Whirlpool Wins $27M in Trademark Infringement Verdict

Case Background

This case arose from a dispute over electronic stand mixers. Plaintiffs Whirlpool Corporation and Whirlpool Properties, Inc. (collectively, "Whirlpool") brought the action. The Defendants were Shenzhen Sanlida Electrical Technology Co., Ltd and Shenzhen Avoga Technology Co. Ltd. The two Defendants were collectively referred to as the Shenzhen Defendants. The civil action was filed in the United States District Court for the Eastern District of Texas, Marshall Division. The lawsuit centered on claims of trademark infringement and unfair competition.

Cause

Whirlpool alleged the Shenzhen Defendants violated fundamental tenets of fair competition. They claimed the Defendants traded improperly on the goodwill associated with the KITCHENAID® brand stand mixers. Whirlpool had built this goodwill through years of innovation, investment, marketing, and hard work. The core of the claim involved U.S. Trademark Registration No. 1,711,158, referred to as the '158 Mark. Whirlpool claimed the Shenzhen Defendants infringed upon and diluted this specific registered trademark. The Defendants’ use of the trademark in their service or product was alleged to be an unauthorized simulation and reproduction.

The alleged conduct created a likelihood of confusion among consumers. Whirlpool maintained that the Defendants’ acts misled the public regarding the origin, sponsorship, or approval of the Shenzhen Defendants’ goods. They also claimed the Defendants conspired with others to aid or assist in these infringing activities. This constituted the basis for the federal trademark infringement, dilution, and unfair competition claims.

Injury

Whirlpool contended the Defendant’s conduct caused significant injury. This injury manifested as actual damages to the corporation. It also resulted in the loss of profits that Whirlpool would have otherwise realized. The Defendant’s unlawful acts diminished the distinctiveness of Whirlpool's valuable '158 Mark. The goodwill and reputation Whirlpool had established were compromised by the Defendants' unfair competition. This violation of trademark rights constituted a legally cognizable injury.

Damages

Whirlpool sought multiple forms of relief in their trademark infringement and dilution lawsuit. Specifically, they demanded full compensation for actual damages caused by the Defendants' conduct, as well as the complete disgorgement of the Shenzhen Defendants' profits gained from the infringement of the KITCHENAID® brand stand mixer's trademark. Additionally, they requested the Court to declare the case exceptional, which would entitle Whirlpool to recover its attorneys' fees and all costs incurred in the action. Finally, they requested a permanent injunction to prohibit the Defendants from any future infringement or unfair competition relating to the '158 Mark.

Key Arguments & Proceedings

Legal Representation

Plaintiffs: Whirlpool Corporation | Whirlpool Properties, Inc.

· Counsel for Plaintiff: Marc Lorelli | Chelsea Elizabeth Pasquali |Melissa Richards Smith | Andrew Thompson Gorham | Chanille Carswell

Defendants: Shenzhen Sanlida Electrical Technology Co., Ltd | Shenzhen Avoga Technology Co. Ltd.

Claims

Whirlpool’s primary claims centered on trademark protection and unfair competition. They asserted the Shenzhen Defendants’ activities constituted direct infringement of the '158 Mark. The Plaintiffs also claimed the Defendants caused dilution of the distinctive quality of the '158 Mark.5Whirlpool sought full compensation for actual damages and the disgorgement of the Defendants' ill-gotten profits. They also requested the Court declare the case exceptional. Such a declaration would allow the recovery of Whirlpool’s incurred attorneys’ fees. Finally, Whirlpool prayed for a permanent injunction to prevent future infringing activity.

Defense

The Shenzhen Defendants vigorously defended against all claims. They filed an Answer asserting numerous affirmative defenses to Whirlpool's Complaint. The Defendants also filed counterclaims against Whirlpool. These counterclaims alleged that Whirlpool engaged in an anticompetitive campaign. They claimed Whirlpool improperly attempted to use trademark laws to monopolize the market for electronic stand mixers. The Defendants asserted that the shape and functions associated with a mixer are descriptive. Therefore, Whirlpool could not monopolize their use through trademark protection.

The Defendants' counterclaims related to an alleged abuse of the legal system. They contended Whirlpool’s actions constituted an illegal attempt to prevent fair competition. Whirlpool denied these counterclaims.

Jury Verdict

A federal jury in the Eastern District of Texas found Chinese appliance manufacturers, Shenzhen Sanlida Electrical Technology Co., Ltd. and Shenzhen Avoga Technology Co. Ltd., liable for infringing a registered trademark belonging to Whirlpool Corporation and Whirlpool Properties, Inc. The jury determined that the Defendants had utilized Whirlpool's protected mark, known as the '158 Trademark, in a way that confused consumers. In its verdict, the jury awarded Whirlpool $25,000,000.00 as compensation for the actual damages the company had suffered. Additionally, the jury ordered the Defendants to pay $2,045,644.00, representing the profits the Chinese companies had made from the illegal sales. Crucially, the jury also ruled that the Defendants' infringing conduct was willful, a finding that allows the judge, if he chooses, to significantly increase the total financial penalty up to three times the initial damage award. This brought the total award found by the jury to $27,045,644.00.

Court Documents

Documents are available for purchase upon request at jurimatic@exlitem.com