Tenkar had a livestream with an actual lawyer. Skip to the 40 minute mark when they actually appear. One thing I noted was how they seem to be in agreement from a legal standpoint that LaNasa could be on the hook for $300,000 (legal fees, damages, etc).
Hope it was worth it Justin.
TL;DR - scroll down for my estimation and rationale that nuTSR could be facing a judgment of about
$1.2 million.
A few years ago, I racked up over $100,000 in legal fees just showing the USPTO that we were using a mark in commerce after someone tried to register one of our existing trademarks for themselves. And that was without the expenses that were about to come up for depositions, which would have involved flying people across the country, etc.
Discovery alone racks up a
lot of hours for the lawyers. And Wizards' lawyers are surely much more expensive than the ones we used. I wouldn't be surprised if WotC's legal fees alone hit the $200k mark or more.
The question then is what other damages might be awarded. This article lays out some good guidance around that question:
How to Measure Trademark Infringement Damages - The Importance of Appropriate Calculation | Citrin Cooperman
FTA, the list of damages the Lanham Act allows for:
- Owner’s lost profits
- Disgorgement of infringer’s profits
- Reasonable royalty
- Corrective advertising
- Augmented punitive damages
- Statutory damages
- Legal fees
I'd guess "lost profits" would be negligible, it's not like fakeTsr made any products that cost WotC sales of D&D.
Disgorgement of infringer's profits: we've seen that Wizards is already asking for that. It's probably a very small number.
Reasonable royalty: How much would Wizards charge someone for the right to sell merchandise with TSR logos? I can't even guess at this.
Corrective advertising: Probably zero, it's not like Wizards has to run any ads telling people about this.
Augmented punitive damages: What I've read about punitive damages in IP cases is that it's usually based on the financial resources of the defendant, and their intent. Punitive damages exist to deter an offender from doing it again, so a huge company like Costco might get hit with millions, but a small business wouldn't necessarily get hit with damages intended to put them out of business. LaNasa's companies don't have much money, and there are enough other damages to hit him with, so my entirely unqualified opinion is that a judge would probably not award much. Then again, it was clearly done in bad faith with ill intent, so you never know.
Statutory damages: This is probably where the hammer will come down the hardest, outside of the legal fees.
Here's the relevant portion of the law:
15 U.S. Code § 1117 - Recovery for violation of rights
(c) Statutory damages for use of counterfeit marks
In a case involving the
use of a
counterfeit mark (as defined in
section 1116(d) of this title) in connection with the sale, offering for sale, or distribution of goods or services, the plaintiff may elect, at any time before final judgment is rendered by the trial court, to recover, instead of actual damages and profits under subsection (a), an award of statutory damages for any such
use in connection with the sale, offering for sale, or distribution of goods or services in the amount of—
(1) not less than $1,000 or more than $200,000 per
counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers just; or
(2) if the court finds that the
use of the
counterfeit mark was willful, not more than $2,000,000 per
counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers just.
This is a case of counterfeit marks. nuTSR willfully counterfeited the artwork in the real TSR logos. That means it's a minimum of $1,000 per mark per type of goods sold, and a maximum of two million dollars per. They counterfeited four marks according to the counter-claim: the lizardman, wizard, moon, and angled logo. They also used them in multiple USPTO classes: IC 016 (Game books), IC 028 (Dice and accessories for games), IC 035 (Trade shows), IC 041 (Entertainment), and IC 025 (Clothing).
So that's four counterfeit marks in five categories = 20 violations total.
The
minimum award would be $20,000. I won't speculate on how high it could go. I'm sure it would never go to $2 million per violation, but even if it went up to $10k per violation, you're talking a base of $200,000 just for statutory damages, and that's before it's trebled.
Finally, we get to the cybersquatting. Statutory damages for cybersquatting are $1,000 to $100,000 per domain. (
Statutory damages under the Anticybersquatting Consumer Protection Act)
Two domains are listed in the counterclaim, one for the museum and one for the game company. So there's a minimum of $2,000 in damages, and let's call it $10k per domain because it's clearly done in bad faith, but we're not talking about a huge company with deep pockets.
Keeping score:
Legal fees: $200,000
Profits: ????
Punitive damages: $0
Statutory damages: $200,000
Cybersquatting: $20,000
Total damages = $420,000
Treble damages, as the law requires = $1,260,000
I am not a lawyer, and you can make your own speculations about what Wizards is likely to ask for and what a judge or jury is likely to award. But I think it's pretty reasonable to say that even before the court hands over nuTSR's meager profits, Justin LaNasa is looking at a judgment of a million dollars or more for this adventure.
I'd love to hear from an IP lawyer with their actual expert opinion on my amateur speculation.
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