Intellectual Property Law

Will a Cryptic "Juror Letter" Unravel Adidas' $300 Million Victory?

By Michael Atkins

Is this another instance of jurors playing Sudoku?

Cryptic docket entries about a “juror letter” and sealed court records suggest something’s gone awry in the Adidas v. Payless Shoesource case that resulted in what reportedly was the largest damages award ever in a case of trademark infringement.

On May 5, a nine-person jury in the District of Oregon found Payless Shoesource, Inc., liable for infringing Adidas America, Inc.’s three-stripe trademark and awarded Adidas a whopping $305 million. (STL post here; jury verdict form here).

Three weeks later, on May 27, the court entered on the docket an “Order - Setting a Telephone Conference to discuss a juror letter….” The telephone conference with the parties’ attorneys was set for 1 p.m. the same day.

The next docket entry states: “MINUTES of Telephone Conference: Juror letter discussed as stated on the record.” The entry does not provide any more information, though the court set an in-person status conference for 11:30 a.m. the next day.

No docket entry reveals what transpired during the in-court conference.

Two days later, on May 30, the court entered a scheduling order — under seal. The docket entry does not say what events the scheduling order governed.

The next apparently relevant entry, for June 9, states: “Order - At the parties’ request the Court is setting a briefing schedule as follows: Defendant’s Motion is due by 6/9/2008. Plaintiffs’ Response is due by 6/16/2008. Defendant’s Reply is due by 6/19/2008.” The docket does not reveal the subject matter of the briefs.

However, the next entry, also dated June 9, states: “Supplemental Motion for New Trial. Oral Argument requested. The untitled motion was filed under seal. The docket states it was filed by Payless Shoesource.

The next three entries — the docket’s most recent — are all filed under seal. The docket describes them as “Memorandum in Opposition to Defendant’s Supplemental Motion for New Trial,” filed by Adidas; “Declaration of Stephen M. Feldman” (Adidas’ attorney); and “Payless’ Reply Brief in further support of Supplemental Motion for a New Trial,” filed by Payless Shoesource.

What is going on here? What did that “juror letter” say? Did it disclose juror misconduct? Attorney misconduct? Is it going to unravel Adidas’ $300 million victory? Even if it is, why all the secrecy?

Is John Grisham now writing the court’s docket entries?

The case cite is Adidas America, Inc. v. Payless Shoesource, Inc., No. 01-1655 (D. Or.) (King, J.).

STL thanks a savvy STL reader/tipster who wishes to remain anonymous for bringing this issue to light.

Full post as published by Seattle Trademark Lawyer on June 25, 2008 (boomark / email).