DENISE COTE, District Judge
L'Oreal USA, Inc. and Luxury Products, LLC ("Lancôme") movedin limine to exclude the direct testimony of James Malackowski ("Malackowski"), an expert for plaintiffs Juicy Couture, Inc. and L.C. Licensing, Inc. ("Couture") in this trademark infringement action. The motion was granted in part prior to the non-jury trial held from April 4 to 12, 2006. Couture's claims at trial were denied on the merits through an Opinion issued on April 19, and it was therefore unnecessary at trial to calculate damages.See Juicy Couture, Inc. v. L'Oreal USA, Inc., 04 Civ. 7203 (DLC), 2006 WL 1012939 (S.D.N.Y. Apr. 19, 2006). This Opinion sets forth the reasons for the ruling on the Malackowski motion.
At trial, Couture sought to prove that Couture's trademarks JUICY, JUICY COUTURE and CHOOSE JUICY, registered for women's clothing, were infringed when Lancôme adopted the product name Juicy Wear for a long-lasting lipstick. Couture aspires to enter the cosmetic market someday, but has not yet done so. Malackowski's damage calculation was based on four distinct theories of damages: the cost of future corrective advertising necessary to address consumer misimpressions created by Lancôme's product; the value of hypothetical royalty payments from Lancôme to Couture for the use of its marks; Lancôme's profits on Juicy Wear; and actual harm to Couture in the form of lost profits.
Lancôme argued that Couture cannot recover damages for corrective advertising or through a construction of reasonable royalties. Lancôme also challenged Malackowski's calculations for damages based on Lancôme's profits. Couture abandoned Malackowski's fourth theory of damages: profits lost by Couture. Lancôme's motion was granted as to the corrective advertising and royalty measures for damages; it was denied as to Lancôme's profits on Juicy Wear.
Corrective Advertising
Corrective advertising is a remedy that seeks to counteract public confusion resulting from trademark infringement. Lurzer GMBH v. American Showcase, Inc., 75 F. Supp. 2d 98, 101 (S.D.N.Y. 1998). In contrast to a claim for damages that seeks reimbursement for a plaintiff's past expenditures in conducting such advertising that was concurrent with the wrong, an award for corrective advertising to be run in the future has been described as "an extraordinary remedy reserved for cases in which a plaintiff lack[ed] financial ability to pay for reparative ads."Id.; see also Mastercard International, Inc. v. Arbel Corp., No. 86 Civ. 6801 (SWK), 1989 WL 125781, *8 (S.D.N.Y. Oct. 18, 1989).
The Tenth Circuit first articulated the "financial ability" limitation on prospective corrective advertising in Big O Tire Dealers, Inc. v. Goodyear Tire Rubber Co., 561 F.2d 1365 (10th Cir. 1977). In Big O, the Tenth Circuit allowed an award for prospective corrective advertising where it was clear that the plaintiff had lacked the financial wherewithal to conduct adequate corrective advertising before trial. Id. at 1375.
The use of prospective corrective advertising has been criticized as arbitrary and inefficient. See J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 30:84 (4th ed. 2006) ("McCarthy on Trademarks"). The Seventh Circuit has opined that an award of corrective advertising should be limited to cases where the plaintiff shows not only that the confusion injured the pl