EAGLES, LTD. and EAGLES RECORDING CO. v. AMERICAN EAGLE FOUNDATION f/k/a NATIONAL FOUNDATION TO PROTECT AMERICA’S EAGLES

*The Honorab le Avern Cohn, United States District Judge for the
Eastern District of Michigan, sitting by designation.
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RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
ELECTRONIC CITATION: 2004 FED App. 0035P (6th Cir.)
File Name: 04a0035p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
EAGLES, LTD. and EAGLES
RECORDING CO.,
Plaintiffs-Appellees,
v.
AMERICAN EAGLE
FOUNDATION f/k/a NATIONAL
FOUNDATION TO PROTECT
AMERICA’S EAGLES,
Defendant-Appellant.
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No. 02-5560
Appeal from the United States District Court
for the Eastern District of Tennessee at Knoxville.
No. 98-00090—R. Leon Jordan, District Judge.
Argued: December 10, 2003
Decided and Filed: January 29, 2004
Before: ROGERS and COOK, Circuit Judges; COHN,
District Judge.*
2 Eagles, Ltd., et al. v. Am.
Eagle Foundation
No. 02-5560
_________________
COUNSEL
ARGUED: James R. Hastings, COLLEN IP, Ossining, New
York, for Appellant. Carla J. Christofferson, O’MELVENY
& MYERS, Los Angeles, California, for Appellees.
ON BRIEF: James R. Hastings, Jess M. Collen, COLLEN
IP, Ossining, New York, for Appellant. Carla J.
Christofferson, Daniel M. Petrocelli, O’MELVENY &
MYERS, Los Angeles, California, Michael J. Avenatti,
GREEN, BROILLET, PANISH & WHEELER, Santa
Monica, California, for Appellees.
_________________
OPINION
_________________
AVERN COHN, District Judge. This is a trademark case.
Defendant American Eagle Foundation (AEF) appeals from
the district court’s denial of its motion for attorney’s fees and
costs under 15 U.S.C. § 1117(a) and 28 U.S.C. § 1927 and the
district court’s denial of its motion to order the Patent and
Trademark Office (PTO) to dismiss a trademark opposition
filed by plaintiffs based on the dismissal of the district court
action. AEF says that (1) the district court erred by failing to
articulate its reasons for denying attorney’s fees and costs;
(2) the district court improperly held it to a higher standard
for proving an “exceptional” case under 15 U.S.C. § 1117(a);
and (3) the district court had jurisdiction and should have
ordered the PTO to dismiss the pending opposition. Plaintiffs
say that (1) the district court adequately stated the applicable
legal standards for an award of attorney’s fees as well as its
reasoning for the denial; (2) the district court did not abuse its
discretion in holding that the circumstances of the case were
not “exceptional;” and (3) the district court correctly refused

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No. 02-5560 Eagles, Ltd., et al. v. Am.
Eagle Foundation
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to dismiss the opposition because the issue of estoppel must
be raised before the PTO not the district court. We affirm.
I. BACKGROUND
Plaintiff Eagles, Ltd. (EL) is one of several companies
affiliated with the Eagles, a rock and roll band formed in
1971. EL owns the registered trademark and service mark
“Eagles.” AEF is a non-profit organization dedicated to
protecting American bald eagles. It engages in education and
protection activities, as well as selling and promoting music-
related products such as a song entitled “Save the Eagle.”
AEF uses the Internet domain name “eagles.org” and vanity
telephone numbers such as (800) 2-EAGLES.
AEF filed a trademark application for the “American
Eagles Records” mark in 1995. EL filed Opposition No.
103,477 in response. Before the PTO ruled on AEF’s
application, EL filed suit in the district court in 1998 against
AEF for trademark infringement, dilution, and other causes of
action under the Lanham Act. The PTO then suspended its
proceedings pending final disposition of the civil action.
The trial was originally scheduled to begin in April 2000
but was delayed and rescheduled for June 2001. The parties
then submitted cross motions for summary judgment, which
were denied by the district court. On May 29, 2001, less than
two weeks before trial was set to begin, EL moved for
substitution of counsel and requested a continuance until fall
2001 because important witnesses, including members of the
band, would be on tour in Europe during the summer and
unavailable to testify. The district court granted the motion
for substitution of counsel but denied EL’s motion for a
continuance.
EL then moved for voluntary dismissal of its action
pursuant to Rule 41(a)(2) of the Federal Rules of Civil
Procedure, arguing that it would be economically unfeasible
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Eagle Foundation
No. 02-5560
for it to go to trial in a week with completely new counsel and
many of its witnesses unavailable to testify. The district court
dismissed EL’s case with prejudice and allowed AEF to move
for attorney’s fees and costs. AEF also moved to include as
part of the Rule 41(a)(2) dismissal an order directing that the
suspended opposition in the PTO be dismissed with prejudice.
The district court declined to dismiss the opposition and
denied AEF’s motion for attorney’s fees and costs under
15 U.S.C. § 1117(a) and 28 U.S.C. § 1927.
II. ANALYSIS
A. District Court’s Statement of Reasons for Denying
Attorney’s Fees
The district court’s denial of attorney’s fees under
15 U.S.C. § 1117(a) and 28 U.S.C. § 1927 is reviewed for
abuse of discretion. See Johnson v. Jones, 149 F.3d 494, 503
(6th Cir. 1998); Ridder v. City of Springfield, 109 F.3d 288,
298 (6th Cir. 1997). “This court has defined an abuse of
discretion as a ‘definite and firm conviction that the trial court
committed a clear error of judgment.’” Arban v. West Publ’g
Corp., 345 F.3d 390, 404 (6th Cir. 2003) (citation omitted).
15 U.S.C. § 1117(a) reads (emphasis added):
When a violation of any right of the registrant of a mark
registered in the Patent and Trademark Office, a violation
under section 43(a) or (d), or a willful violation under
section 43(c), shall have been established in any civil
action arising under this Act, the plaintiff shall be
entitled, subject to the provisions of sections 29 and 32,
and subject to the principles of equity, to recover
(1) defendant’s profits, (2) any damages sustained by the
plaintiff, and (3) the costs of the action. The court shall
assess such profits and damages or cause the same to be
assessed under its direction. In assessing profits the
plaintiff shall be required to prove defendant’s sales

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Eagle Foundation
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only; defendant must prove all elements of cost or
deduction claimed. In assessing damages the court may
enter judgment, according to the circumstances of the
case, for any sum above the amount found as actual
damages, not exceeding three times such amount. If the
court shall find that the amount of the recovery based on
profits is either inadequate or excessive the court may in
its discretion enter judgment for such sum as the court
shall find to be just, according to the circumstances of the
case. Such sum in either of the above circumstances
shall constitute compensation and not a penalty. The
court in exceptional cases may award reasonable
attorney fees to the prevailing party.
28 U.S.C. § 1927 reads (emphasis added):
Any attorney or other person admitted to conduct cases
in any court of the United States or any Territory thereof
who so multiplies the proceedings in any case
unreasonably and vexatiously may be required by the
court to satisfy personally the excess costs, expenses, and
attorneys’ fees reasonably incurred because of such
conduct.
AEF says that the district court in denying attorney’s fees
abused its discretion because it failed to adequately articulate
its reasons. In Israel v. City of Barberton, 936 F.2d 573, No.
90-3268, 1991 U.S. App. LEXIS 32336, at *3 (6th Cir.
Apr. 4, 1991) (unpublished), this Court held that “[i]n order
to review a discretionary decision [to deny attorney’s fees],
some understanding of the trial court’s reasons is necessary.
Absent a statement of reasons, no meaningful review can be
made.” The district court in Israel denied a motion for
attorney’s fees “by a marginal denial” with no hearing or
statement of reasons and the case was remanded so that the
district court could give its reasons for the denial. Id. at *2,
*4. In Morscott, Inc. v. City of Cleveland, 936 F.2d 271, 272
(6th Cir. 1991), this Court held that a district court’s marginal
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Eagle Foundation
No. 02-5560
entry that completely fails to set forth any reason for the
denial is an abuse of discretion because it is impossible to
determine on appeal whether the district court was aware that
it had the discretion to award attorney’s fees.
Unlike the trial courts in Israel and Morscott, the district
court here gave more than a marginal denial without support.
The district court’s order was sufficient because it clearly
stated the applicable law and gave the reasons for the denial.
Regarding 15 U.S.C. § 1117(a), the district court recognized
that it had discretion under the “exceptional” case standard
and cited cases from this Court applying the test. The district
court then recited each side’s arguments and stated:
The court has considered the circumstances of this case
and the applicable legal standard and in its discretion
concludes that this is not an exceptional case as called for
under § 1117(a). Litigation requires strategic and often
difficult and costly decisions. However, in the context of
this case, such decisions do not qualify it as an
“exceptional” case warranting an award of fees.
Regarding 28 U.S.C. § 1927, the district court stated the
proper legal standard, recognized its discretion, and held:
Defendant contends that the conduct ascribed to the
plaintiffs satisfies the standard of section 1927. Plaintiffs
do not specifically direct their response to this contention
but argue[] the case was not pursued in a vexatious,
wanton, or oppressive manner. In any event, the court
has again considered the circumstances of this case in
light of the standard required by § 192[7], and in its
discretion finds that an award of fees under this provision
is not warranted. Accordingly, defendant’s motion for
costs and fees will be denied in its entirety.
Having handled the case over the course of four years, the
district court was in the best position to determine whether the

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Eagle Foundation
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circumstances of the case and conduct of EL warranted an
award of attorney’s fees. The district court addressed the
parties’ arguments and applied the correct legal standard.
Further, the record relied on by the district court is available
for review on appeal. The adequacy of a district court’s
statement is determined by this Court’s ability to understand
its reasoning, not by the number of sentences it uses. The
district court’s order was sufficient to allow meaningful
review under the deferential abuse of discretion standard.
B. “Exceptional” Case Under 15 U.S.C. § 1117(a)
The district court’s denial of attorney’s fees under
15 U.S.C. § 1117(a) is reviewed for abuse of discretion, but
the district court’s legal analysis and interpretation of the
Lanham Act is reviewed de novo. See Stephen W. Boney, Inc.
v. Boney Servs., Inc., 127 F.3d 821, 825 (9th Cir. 1997).
Under 15 U.S.C. § 1117(a), a district court may award
reasonable attorney fees to the prevailing party in
“exceptional” cases. Here, the district court correctly
recognized that the term “exceptional” is not defined in the
statute, although a case is not exceptional unless “the
infringement was malicious, fraudulent, willful, or
deliberate.” See Hindu Incense v. Meadows, 692 F.2d 1048,
1051 (6th Cir. 1982). Because it relates to the act of
infringement, the Hindu Incense standard clearly applies to
prevailing plaintiffs. Indeed, most of the cases involving 15
U.S.C. § 1117(a) have applied the “exceptional” case analysis
to prevailing plaintiffs. It is clear, however, that Congress
intended to include prevailing defendants as well. See S. Rep.
No. 93-1400 (1974), reprinted in 1974 U.S.C.C.A.N. 7132,
7136.
In applying 15 U.S.C. § 1117(a) to a prevailing defendant,
this Court has held that an “exceptional” case is one “where
a plaintiff brings a suit that could fairly be described as
‘oppressive.’” Balance Dynamics Corp. v. Schmitt Indus.,
8 Eagles, Ltd., et al. v. Am.
Eagle Foundation
No. 02-5560
Inc., 208 F.3d 212, No. 98-1143, 2000 U.S. App. LEXIS
3290, at *2 (6th Cir. Feb. 25, 2000) (unpublished) (citing
Finance Inv. Co. v. Geberit AG, 165 F.3d 526, 533 (7th Cir.
1998)). This Court has also held that “[w]here a plaintiff sues
under a colorable, yet ultimately losing, argument, an award
of attorney’s fees is inappropriate.” American Council of
Certified Podiatric Physicians & Surgeons v. American Bd.
of Podiatric Surgery, Inc., 185 F.3d 606, 625 (6th Cir. 1999).
AEF says that these cases have created an artificial bias in
favor of prevailing plaintiffs in Lanham Act cases, which
violates the party-neutral approach of Fogerty v. Fantasy,
Inc., 510 U.S. 517, 534-35 (1994) (“Prevailing plaintiffs and
prevailing defendants are to be treated alike, but attorney’s
fees are to be awarded to prevailing parties only as a matter of
the court’s discretion.”). Fogerty, however, did not specify
that the standard for prevailing plaintiffs and prevailing
defendants had to be identical. Rather, it stated that courts
should generally award attorney’s fees in an even-handed
manner. It is difficult to imagine how the standards for
15 U.S.C. § 1117(a) could be the same given that prevailing
plaintiffs focus on the act of infringement while prevailing
defendants point to the act of litigation. See National Ass’n
of Prof’l Baseball Leagues, Inc. v. Very Minor Leagues, Inc.,
223 F.3d 1143, 1148-49 (10th Cir. 2000).
While the circuits differ somewhat as to the test for
determining whether a case is “exceptional,” often replacing
the term with other adjectives, see, e.g., Ale House
Management, Inc. v. Raleigh Ale House, Inc., 205 F.3d 137,
144 (4th Cir. 2000) (“Relevant factors include ‘economic
coercion,’ ‘groundless arguments,’ and failure to cite
controlling law.”); Scott Fetzer Co. v. Williamson, 101 F.3d
549, 555 (8th Cir. 1996) (“When a plaintiff’s case is
groundless, unreasonable, vexatious, or pursued in bad faith,
it is exceptional, and the district court may award attorney’s
fees to the defendant.”), we believe that the “oppressive”
standard first followed in Balance Dynamics most closely

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Eagle Foundation
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follows the statute. Awarding attorney’s fees to a prevailing
defendant is meant to “provide protection against unfounded
suits brought by trademark owners for harassment and the
like.” S. Rep. No. 93-1400 (1974), reprinted in 1974
U.S.C.C.A.N. 7132, 7136. The test requires an objective
inquiry into whether the suit was unfounded when it was
brought and a subjective inquiry into the plaintiff’s conduct
during litigation. See S Indus. v. Centra 2000, Inc., 249 F.3d
625, 627 (7th Cir. 2001) (“A suit is oppressive if it lacked
merit, had elements of an abuse of process claim, and
plaintiff’s conduct unreasonably increased the cost of
defending against the suit.”); National Ass’n of Prof’l
Baseball Leagues, 223 F.3d at 1146-47 (“No one factor is
determinative, and an infringement suit could be ‘exceptional’
for a prevailing defendant because of (1) its lack of any
foundation, (2) the plaintiff’s bad faith in bringing the suit,
(3) the unusually vexatious and oppressive manner in which
it is prosecuted, or (4) perhaps for other reasons as well.”).
The “oppressive” test is similar to the standard applied to
prevailing plaintiffs where an award is appropriate if the
infringement is “malicious, fraudulent, willful, or deliberate.”
See Hindu Incense, 692 F.2d at 1051. Both allow an award of
fees where the opposing party abused the protections afforded
by the Lanham Act. The standard of law applied by the
district court, therefore, did not violate Fogerty’s party-
neutral requirement.
Next, AEF argues that the district court incorrectly applied
a heightened “clear and convincing” burden of proof because
it cited Finance Investment, 165 F.3d at 533, which required
clear and convincing evidence of exceptional circumstances.
Although AEF is correct that a “clear and convincing”
requirement is not supported by the language of the statute,
there is no indication in the district court’s opinion that it
applied a “clear and convincing” burden of proof. Similarly,
AEF argues that the district court inappropriately relied on
Finance Investment by only considering EL’s actions in
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Eagle Foundation
No. 02-5560
bringing the suit and not its later conduct during litigation.
However, it is clear that the district court considered EL’s
alleged conduct during litigation, including “the use of certain
witnesses, the last-minute exhibit list, and [EL’s] apparent
intention not to go to trial,” and recognized the difficulty
faced by EL that led to its voluntarily dismissing lengthy and
expensive litigation.
Finally, AEF argues that the district court applied the
wrong standard because it based its denial on a finding that
EL brought the action in good faith. AEF says that the
district court implicitly required it to prove bad faith on the
part of EL to receive attorney’s fees, which it says is
incorrect. See Scotch Whisky Ass’n v. Majestic Distilling Co.,
958 F.2d 594, 599 (4th Cir. 1992) (requiring “‘something less
than bad faith’” to award attorney’s fees to a prevailing
defendant). But see Conopco, Inc. v. Campbell Soup Co., 95
F.3d 187, 194-95 (2d Cir. 1996) (requiring the defendant to
show the plaintiff’s bad faith). Simply because the district
court referred to EL’s argument that its case was brought in
good faith and on the advice of counsel does not mean that it
was looking for the opposite. There is no indication that the
district court required a showing of bad faith.
EL had colorable legal arguments and legitimate reasons
for choosing to dismiss the lawsuit. The district court applied
the correct legal standard and in its discretion found that the
case was not “exceptional” under 15 U.S.C. § 1117(a). The
district court did not abuse its discretion in holding that AEF
was not entitled to attorney’s fees.
C. Pending PTO Opposition
The district court’s decision regarding the Rule 41(a)(2)
motion is reviewed for abuse of discretion. United States v.
266 Tonawanda Trail, 95 F.3d 422, 425 (6th Cir. 1996). The
district court’s decision to include certain terms and
conditions in a Rule 41(a)(2) voluntary dismissal is

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Eagle Foundation
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appealable only if unreasonable. See Duffy v. Ford Motor
Co., 218 F.3d 623, 627 (6th Cir. 2000).
EL’s opposition in the PTO to AEF’s application for the
“American Eagles Records” mark was suspended pending
resolution of this case. After the district court dismissed the
case with prejudice pursuant to Rule 41(a)(2), AEF moved to
reconsider the dismissal arguing for the first time that the
district court should order EL or the PTO to dismiss the
opposition with prejudice as part of the Rule 41(a)(2)
dismissal’s terms and conditions. AEF argued that EL should
be “estopped” from pursuing the opposition because it told
the PTO that this case would be dispositive of the opposition,
although EL’s statement is not in the record. The district
court denied EL’s request and held that “[t]he issue of
estoppel is before the Trademark tribunal not this court. If
defendant believes that the plaintiffs should be prohibited
from pursuing the Opposition action in the Trademark Office
because of the result in this case, then defendant needs to
make that argument to the Trademark Office.”
AEF says that district courts are given clear statutory
authority over actions regarding the trademark registration
process under 15 U.S.C. § 1119, which states that “[i]n any
action involving a registered mark the court may determine
the right to registration, order the cancelation of registrations,
in whole or in part, restore canceled registrations, and
otherwise rectify the register with respect to the registrations
of any party to the action.” AEF cites Avon Shoe Co. v.
David Crystal, Inc., 279 F.2d 607, 609 (2d Cir. 1960), which
involved a dispute over the plaintiff’s use of the “Haymakers”
mark and the defendant’s use of the “Haymaker” mark. The
Second Circuit affirmed the district court’s order directing the
PTO to dismiss the plaintiff’s opposition and grant the
concurrent registration of defendant’s mark. Id. at 614-16.
This case is factually distinguishable from Avon Shoe,
however, because the marks at issue are not the same. The
issue in this case was whether AEF’s activities infringed or
12 Eagles, Ltd., et al. v. Am.
Eagle Foundation
No. 02-5560
diluted EL’s “Eagles” mark; the case did not involve AEF’s
rights in the “American Eagles Records” mark. While the
district court may have had general authority under 15 U.S.C.
§ 1119 to order the PTO to take action, it did not have the
authority to decide issues regarding a mark that was not
properly before it. See Old Dutch Foods, Inc. v. Dan Dee
Pretzel & Potato Chip Co., 477 F.2d 150, 157 (6th Cir. 1973)
(directing the PTO to issue a concurrent registration to the
defendant with limitations); Durox Co. v. Duron Paint Mfg.
Co., 320 F.2d 882, 883, 885-86 (4th Cir. 1963) (directing the
PTO to issue a registration for the plaintiff’s mark after the
plaintiff properly raised the issue of validity in the
complaint); Massa v. Jiffy Prods. Co., 240 F.2d 702, 704, 707
(9th Cir. 1957) (directing the PTO to cancel the “Jiffy” mark
for the plaintiff and award a registration for the same mark to
the defendant).
Further, the prospect of dismissal of the PTO opposition
was not properly before the district court because AEF raised
the issue for the first time in its motion for reconsideration.
AEF failed to raise the argument as a counterclaim to the
infringement action. Hence, according to the procedural
posture of the case and by AEF’s own admissions, its
argument for dismissal is not based on the merits but on an
estoppel theory. As the district court correctly pointed out,
estoppel issues are ordinarily enforced by awaiting a second
action in which they are pleaded and proved by the party
asserting estoppel. The PTO, not the district court, must
determine the preclusive effect of EL’s statements.
Even if the issue of estoppel was properly before the district
court, however, in light of the PTO’s expertise and the district
court’s failure to reach the merits of the underlying action in
this case, the district court’s decision was reasonable and not
an abuse of discretion.

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Eagle Foundation
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III. CONCLUSION
The district court adequately articulated its reasons for
denying attorney’s fees and costs, applied the correct legal
standard for “exceptional” cases under 15 U.S.C. § 1117(a),
and in its discretion denied AEF’s request for attorney’s fees.
The district court also did not abuse its discretion by refusing
to dismiss the pending trademark opposition.
Accordingly, the district court’s decision is AFFIRMED.

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