Intellectual PropertyTrademark Litigation
Damages Apportionment in Trademark Cases: A Practical Guide
When a defendant infringes a trademark on one product but runs a much larger business, how much can the plaintiff actually recover? The answer lies in the doctrine of apportionment, which limits recovery to the profits and damages actually attributable to the infringement rather than the defendant's entire revenue. This guide explains, in plain language for lawyers and business owners alike, how apportionment works under Section 35 of the Lanham Act, 15 U.S.C. § 1117(a). It maps the unusual burden-shifting structure—where the plaintiff proves the defendant's infringement-related sales, the defendant proves its costs and the share of profit not caused by the infringing mark, and sales are treated as profit until the defendant proves otherwise. It covers the two layers of apportionment, the proximate-cause requirement, the Supreme Court's 2025 narrowing of recoverable profits to the named defendant in Dewberry, the equitable factors the Second Circuit weighs, the role of willfulness after Romag, the alternative measures of actual damages (lost profits, reasonable royalty, and corrective advertising), and when courts exclude damages testimony as speculative. It closes with a worked example and practical takeaways for both sides.