No Statutory Lanham Act Damages Without a Registered Mark: Fifth Circuit Vacates Awards and Clarifies Limits on Attorney Immunity in Lewis Brisbois v. Bitgood

No Statutory Lanham Act Damages Without a Registered Mark: Fifth Circuit Vacates Awards and Clarifies Limits on Attorney Immunity in Lewis Brisbois v. Bitgood

Introduction

In an unpublished but instructive per curiam decision, the United States Court of Appeals for the Fifth Circuit addressed a brazen scheme in which litigants created a sham law firm entity bearing the name of national law firm Lewis Brisbois Bisgaard & Smith LLP (LBBS), then used that name and letterhead in court filings and public communications. The district court awarded LBBS summary judgment on several Lanham Act and related claims, entered a permanent injunction, and assessed substantial statutory damages and attorney’s fees. On appeal, the Fifth Circuit affirmed liability and the injunction but vacated the statutory damages and fee awards, remanding for further proceedings.

The opinion clarifies several important points:

  • Rooker-Feldman abstention does not apply absent a final state-court judgment, and the panel treated its prior preliminary-injunction decision as law of the case on issues it actually decided.
  • Texas attorney immunity does not shield an attorney’s participation in independently fraudulent or wrongful conduct, including conspiring to form an infringing sham entity.
  • For Lanham Act statutory damages under 15 U.S.C. § 1117(c), the plaintiff must tie the conduct to a registered mark under § 1114(1)(a); an unregistered mark will not do.
  • The panel flagged—but did not resolve—the Seventh Amendment question whether a jury must determine the amount of Lanham Act statutory damages, directing the district court to consider it on remand.

Parties: Plaintiff–Appellee LBBS; Defendants–Appellants Michael Joseph Bitgood (a/k/a Michael Easton), attorney Susan C. Norman, and attorney Bradley B. Beers.

Summary of the Opinion

The case stems from state-court litigation where Bitgood and Norman discovered that LBBS’s Texas foreign LLP registration had lapsed. They reacted by registering a Texas entity with the LBBS name and filing an assumed-name certificate through Beers, then adding the sham entity as a party and moving under Texas Rule 12 to challenge the real LBBS’s authority to represent its client. Despite a cease-and-desist letter, defendants continued to use LBBS’s name and letterhead.

LBBS sued in federal court for trademark infringement (15 U.S.C. § 1114), unfair competition (15 U.S.C. § 1125(a) and Texas common law), common-law fraud, and civil conspiracy. The district court granted summary judgment on infringement, unfair competition, and conspiracy-to-infringe; entered a permanent injunction; and awarded statutory damages and fees. It denied summary judgment on fraud and conspiracy-to-commit-fraud and dismissed those claims with prejudice.

On appeal, the Fifth Circuit:

  • Rejected Rooker-Feldman and applied law-of-the-case from a prior panel decision affirming a preliminary injunction.
  • Held that attorney Beers was not protected by Texas attorney immunity given findings that he knowingly assisted in forming the sham entity to harm LBBS.
  • Reaffirmed (via law-of-the-case) that defendants’ conduct constituted “use in commerce” under the Lanham Act.
  • Vacated statutory damages because LBBS’s core mark registration had lapsed during the relevant period; remanded to determine whether defendants’ conduct infringed other registered LBBS marks and, if so, to reassess liability and damages under § 1114(1)(a) and § 1117(c).
  • Directed the district court to consider whether the Seventh Amendment requires a jury to set statutory damages under the Lanham Act.
  • Vacated the fee award for reconsideration after the damages issues are resolved.

Disposition: Affirmed as to unfair competition, conspiracy to infringe, and the permanent injunction; vacated statutory damages and attorney’s fees; remanded for proceedings consistent with the opinion.

Detailed Analysis

Precedents Cited and Their Influence

  • Rooker-Feldman and Law of the Case:
    • Lance v. Dennis, 546 U.S. 459 (2006) (per curiam), and Miller v. Dunn, 35 F.4th 1007 (5th Cir. 2022): Confirm that Rooker-Feldman bars lower federal-court review of final state-court judgments, not interlocutory events. There was no final state judgment here.
    • Christianson v. Colt Indus. Operating Corp., 486 U.S. 800 (1988); Royal Ins. Co. of Am. v. Quinn-L Capital Corp., 3 F.3d 877 (5th Cir. 1993); Gaalla v. Brown, 460 F. App’x 469 (5th Cir. 2012): The “law-of-the-case” doctrine applies when an earlier panel actually decides an issue—even in an interlocutory appeal—governing subsequent stages of the case. The prior panel (LBBS 1) had actually decided that Rooker-Feldman did not apply and that defendants’ conduct was a “use in commerce.”
  • Attorney Immunity:
    • Ironshore Eur. DAC v. Schiff Hardin, L.L.P., 912 F.3d 759 (5th Cir. 2019): Standard of review for attorney-immunity rulings is de novo.
    • Haynes & Boone, L.L.P. v. NFTD, LLC, 631 S.W.3d 65 (Tex. 2021): Texas law does not shield attorneys for conduct foreign to the duties of an attorney; participation in independently fraudulent activities falls outside immunity. The Fifth Circuit relied on this to uphold the denial of immunity to Beers given district-court findings that he knowingly helped create the infringing sham entity.
  • Lanham Act “Use in Commerce”:
    • Committee for Idaho’s High Desert, Inc. v. Yost, 92 F.3d 814 (9th Cir. 1996): Formation of a corporation and public communication under another’s mark can be a “use in commerce.” The prior Fifth Circuit panel (LBBS 1) invoked Yost and treated the point as settled for this case.
  • Statutory Damages and Registered Marks:
    • 15 U.S.C. § 1114(1)(a): Liability for infringing a “registered mark.”
    • 15 U.S.C. § 1117(c): Statutory damages available for use of a “counterfeit mark” in connection with goods or services; elevated ceilings for willful use.
    • 15 U.S.C. § 1127: “Counterfeit” means a spurious mark that is identical or substantially indistinguishable from a registered mark.
    • Jim S. Adler, P.C. v. McNeil Consultants, L.L.C., 10 F.4th 422 (5th Cir. 2021): § 1114(1)(a) creates a cause of action for infringement of registered marks, underscoring that unregistered marks cannot support § 1117(c) statutory damages.
  • Seventh Amendment and Statutory Damages:
    • Feltner v. Columbia Pictures Television, Inc., 523 U.S. 340 (1998): The Seventh Amendment guarantees a jury trial on all issues pertinent to statutory damages under the Copyright Act, including the amount.
    • Top Tobacco, L.P. v. Star Importers & Wholesalers, Inc., 135 F.4th 1344 (11th Cir. 2025): The Eleventh Circuit extended Feltner’s reasoning to Lanham Act statutory damages. The Fifth Circuit did not adopt or reject this view but instructed the district court to consider the issue on remand.
  • Attorney’s Fees Under the Lanham Act:
    • Alliance for Good Government v. Coalition for Better Government, 919 F.3d 291 (5th Cir. 2019): Abuse-of-discretion review for fee awards; informed by Highmark Inc. v. Allcare Health Mgmt. Sys., Inc., 572 U.S. 559 (2014).
    • ASHH, Inc. v. URZ Trendz, L.L.C., No. 23-20614, 2024 WL 3595385 (5th Cir. July 31, 2024): Restates the deferential standard and grounds for reversal.
    • Fluorine On Call, Ltd. v. Fluorogas Ltd., 380 F.3d 849 (5th Cir. 2004), and Black v. SettlePou, P.C., 732 F.3d 492 (5th Cir. 2013): When damages are remanded, fee awards are typically vacated and remanded as well.

Legal Reasoning

  • Rooker-Feldman and Law-of-the-Case Control the Threshold Arguments: The panel swiftly rejected defendants’ renewed Rooker-Feldman challenge because there was no final state-court judgment. Moreover, a prior Fifth Circuit panel in this very dispute (LBBS 1) had already rejected Rooker-Feldman in affirming a preliminary injunction, and that determination was law of the case. The court emphasized that law of the case applies to issues an earlier panel “actually decided,” even when the prior ruling came on interlocutory review.
  • Attorney Beers Not Immune Under Texas Law: Attorney immunity protects litigation-related conduct within the scope of representation, but it does not extend to conduct “foreign to the duties of an attorney,” such as participation in independently fraudulent acts. The district court found that Beers knew the real LBBS existed, “communicated extensively” with Bitgood and Norman about forming the sham entity, and assisted in doing so to harm LBBS. Accepting these findings, the Fifth Circuit held that his actions fell outside the immunity’s scope under Haynes & Boone.
  • “Use in Commerce” Was Already Decided: The prior panel had concluded that defendants’ conduct—including forming a corporation with the LBBS name and using the name publicly—was a “use in commerce” under the Lanham Act, consistent with the Ninth Circuit’s reasoning in Yost. That determination bound the panel as law of the case.
  • Statutory Damages Vacated: Registration Matters and the Record Was Inadequate: The district court awarded statutory damages under § 1117(c) ($1,000,000 against Bitgood; $500,000 against Norman; $10,000 against Beers) based on willfulness and taunting misuse of LBBS’s name. On appeal, defendants argued that LBBS’s registration for “Lewis Brisbois Bisgaard & Smith” lapsed in 2020 and was not re-registered until 2022, covering the relevant infringement period. Because § 1114(1)(a) applies to registered marks, and § 1117(c) statutory damages flow from such infringement, the lapse undermined the award. LBBS countered that other, similar registered marks existed and were infringed (or counterfeited) within the meaning of § 1127. The Fifth Circuit declined to resolve that alternative theory because the district court had not identified which registered marks supported the damages or made the necessary findings. The court vacated the damages and remanded for the district court to determine, in the first instance, whether defendants’ conduct infringed any registered LBBS marks and, if so, whether and how § 1117(c) damages apply.
  • Seventh Amendment Jury Right on Statutory Damages Must Be Considered: Both sides demanded a jury, but the district court set statutory damages itself. The panel did not decide whether the Seventh Amendment requires a jury to determine the amount of Lanham Act statutory damages but cited Feltner (copyright) and the Eleventh Circuit’s Top Tobacco decision extending Feltner to trademark cases. The district court must consider this constitutional question on remand.
  • Attorney’s Fees Vacated Pending the Damages Reassessment: Following Fifth Circuit practice, the court vacated the fee award because damages were vacated. The propriety and amount of fees are to be reconsidered after the § 1114/§ 1117(c) issues are resolved.

Impact and Practical Implications

  • Trademark Plaintiffs Must Connect Conduct to a Registered Mark for § 1117(c) Damages: The decision reinforces a critical, sometimes overlooked point: statutory damages for counterfeiting under § 1117(c) require proof of infringement of a registered mark under § 1114(1)(a). If a registration has lapsed, plaintiffs should:
    • Identify any other contemporaneously registered marks and explain why the accused use is identical or substantially indistinguishable from those registrations (i.e., “counterfeit” under § 1127).
    • Create a clear record tying specific infringing acts to specific registrations, to support both liability and the measure of statutory damages.
  • Attorney Immunity Has Firm Limits in Texas: Attorneys who knowingly assist in creating sham entities or otherwise participate in independent fraud risk personal liability. This opinion underscores that “zealous advocacy” is not a shield for conduct foreign to the attorney’s duties. Lawyers advising on entity formation or name adoption should conduct trademark clearance and avoid conduct likely to confuse or deceive.
  • “Use in Commerce” Covers Corporate Formation and Public Communications with Another’s Mark: For defendants, technical arguments that they only “filed papers” will not insulate them: registering entities or assumed names and using the mark in public or in litigation can qualify as Lanham Act “use in commerce,” especially when paired with communications designed to trade on another’s goodwill.
  • Jury Trial Right on Statutory Damages Is a Live Question in the Fifth Circuit: The panel directed the district court to consider whether the Seventh Amendment requires a jury to set statutory damages under the Lanham Act. Litigants should preserve this issue, propose appropriate jury instructions and verdict forms, and be prepared to brief the historical analogues supporting or opposing a jury’s role (with Feltner as a touchstone and divergent circuit-level guidance).
  • Injunctive Relief Remains Available Under § 1125(a) Even If a Registration Lapses: The court affirmed permanent injunctive relief alongside liability for unfair competition. Plaintiffs can often secure injunctive relief under § 1125(a) for likely confusion, even if statutory damages under § 1117(c) are unavailable due to registration gaps.
  • Procedural Discipline Matters: The panel noted that many appellate arguments were frivolous or not properly before the court. Parties should focus on preserved, justiciable issues supported by the record and applicable standards of review.
  • Nonprecedential but Persuasive: Although the opinion is unpublished and not binding as precedent under 5th Cir. R. 47.5, its application of settled principles (registered-mark requirement for § 1117(c), limits on Texas attorney immunity, law-of-the-case effect from preliminary-injunction appeals) will be instructive to district courts and practitioners.

Complex Concepts Simplified

  • Rooker-Feldman: A narrow doctrine that prevents federal district courts from acting like appellate courts reviewing final state-court judgments. No final state judgment here, so it doesn’t apply.
  • Law of the Case: Once an appellate court actually decides a legal issue in a case, that decision generally governs the same issue later in the same case. Even an interlocutory decision (like affirming a preliminary injunction) can set law of the case if the issue was actually decided.
  • Attorney Immunity (Texas): Protects attorneys from civil liability to non-clients for conduct within the scope of legal representation. But it does not cover conduct foreign to the lawyer’s duties, such as independently fraudulent acts or schemes.
  • “Use in Commerce” (Lanham Act): Broad concept capturing use of a mark in selling, advertising, or public-facing activities affecting interstate commerce. Creating entities and publicly communicating under another’s mark can qualify.
  • Registered vs. Unregistered Marks: Registration is not required to sue for unfair competition under § 1125(a), but it is required to pursue § 1114(1)(a) infringement of a registered mark and to obtain statutory counterfeiting damages under § 1117(c).
  • Counterfeit: A spurious mark identical to, or substantially indistinguishable from, a registered mark. Counterfeiting triggers enhanced statutory damages under § 1117(c), subject to willfulness and other factors.
  • Seventh Amendment Right to Jury: The Constitution preserves a right to a jury trial in suits at common law. The Supreme Court has held that juries set statutory damages in copyright cases; whether that extends to Lanham Act statutory damages is a live issue in the Fifth Circuit.

Conclusion

Lewis Brisbois v. Bitgood reinforces several fundamental principles in trademark litigation and attorney liability. First, statutory counterfeiting damages under the Lanham Act demand a tight linkage to a registered mark; a lapsed registration is fatal to § 1117(c) damages unless other qualifying registrations and counterfeiting are proved. Second, Texas attorney immunity is no refuge for lawyers who knowingly assist in fraudulent or infringing schemes. Third, “use in commerce” is construed pragmatically: registering entities and publicly acting under another’s mark can suffice. Finally, the court signaled that the Seventh Amendment’s role in trademark statutory damages is an important and unresolved question in this circuit, warranting careful consideration on remand.

Practitioners should ensure timely maintenance of trademark registrations, document precisely which registered marks defendants infringe, and develop a record that supports both liability and the appropriate remedy. Attorneys should be mindful that participation in deceptive schemes may pierce the protections of attorney immunity. Even though unpublished, this decision offers clear guidance on how Fifth Circuit courts will analyze these issues going forward.

Case Details

Year: 2025
Court: Court of Appeals for the Fifth Circuit

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