A jury verdict that found willful counterfeiting of Gibson Brands Inc.’s guitar designs—yet awarded virtually no damages—has both sides claiming victory and attorneys raising eyebrows.
The jury said May 27 that Armadillo Distribution Enterprises Inc. knocked off Gibson’s Flying V, Explorer, and SG guitar designs with its Dean-branded guitars. But while rejecting Armadillo’s claims that the shapes were generic, the jury also found Gibson waited too long to sue and ultimately awarded just $4,000 of the $7 million sought by Gibson.
The seemingly counterintuitive outcome provides a reminder of the importance of timely enforcement of rights—and the unpredictability of juries. It also leaves unclear the extent of liability faced by Armadillo and other guitar makers who sell guitars similar to Gibson designs in the future.
But it’s not clear that the outcome—which both sides will challenge—will help Gibson quite that much, intellectual property attorney Ronald Oines of Rutan & Tucker LLP said. Rulings involving laches—unreasonable delay in bringing the suit—are case specific. But competitors, including Armadillo, could point to the finding as evidence Gibson didn’t sufficiently police the marks, Oines said.
“As far as I can tell the defendants don’t have to stop selling the guitars,” Oines said. He said even newcomers could benefit from “a jury finding that there was a second source of guitars in these shapes for an extended period of time, and Gibson did nothing about it.”
“The longer you wait, the more difficult it is to enforce on anyone.”
Bloomberg Law article Gibson’s ‘Pyrrhic’ Verdict Leaves Guitar-Shape IP Status Unclear