Bidding on a Competitor's Trademark Is Not Infringement. What You Put in the Ad Still Is.

The short answer

On August 4, 2026, the Eleventh Circuit held that buying a competitor's trademark as a search keyword cannot by itself support an infringement claim, because consumers never see the purchase. It affirmed a disgorgement award of more than $12.1 million on the visible uses, reversed a false advertising verdict that had never been pleaded, and vacated the actual damages award. All three holdings are useful, and the reason for each is worth understanding.

Why it comes up

Competitive keyword advertising is standard practice and it generates a steady stream of demand letters. Businesses receive them, panic, and either stop a lawful practice or keep doing something genuinely unlawful because the letter did not distinguish between the two.

What the court held

The case arose from a dispute over the mark "Battery Tender," tried in the Middle District of Florida.

On keyword bidding. Purchasing a competitor's mark as an invisible ad keyword is not infringement standing alone. The consumer never sees the purchase, only the resulting advertisement. Visible use of the mark in the resulting listings and advertisements was infringing.

On genericness. The mark was not generic. Registration created a presumption of validity, and the record showed descriptiveness plus secondary meaning.

On disgorgement. The court affirmed $12,135,943.70 on a finding of willfulness, resting heavily on the defendant's internal communications acknowledging that it could not use the mark in its messaging.

On false advertising. The verdict was reversed because the theory was never pleaded and the defendant never consented to try it.

On actual damages. The award of roughly $1.3 million was vacated because the lump sum could not be separated from theories that had now failed.

Our take: the money came from the emails

The disgorgement figure is the part that will get attention, and the reason for it is the part worth acting on. Willfulness was established by the defendant's own internal communications. The company knew it could not use the mark and used it anyway, and it wrote that down.

That is how nearly every large trademark award happens. Liability is usually a close question. Willfulness usually turns on a document. It is not a precondition to disgorging the infringer's profits: in Romag Fasteners, Inc. v. Fossil, Inc., 590 U.S. 212 (2020), the Supreme Court held that a plaintiff need not show willful infringement to obtain a profits award under 15 U.S.C. 1117(a) for a section 1125(a) violation. The defendant's mental state remains a highly important equitable consideration, and in practice it is decided by what is in the emails. Any business running a competitive advertising program should assume that its internal discussion of a competitor's mark will be read to a jury.

Two other lessons are less dramatic and more likely to matter to an ordinary case.

Plead your theories separately. A false advertising claim under a different subsection of the statute is a different claim from infringement. Trying it by implication and winning is not the same as pleading it, and the Eleventh Circuit will not save it.

Do not put your damages theories in one bucket. A single lump sum that depends on four theories dies if one of them fails. Ask for separate findings.

What it means practically

For a brand owner: keyword bidding by a competitor is not, by itself, a case in this circuit. Look at what the resulting ad says. That is where the exposure is.

For an advertiser: your keyword program is probably defensible. Your ad copy and your marketplace listings may not be, and your internal emails about the competitor are the highest-risk documents in the file.

When to call a lawyer

On receipt of a keyword advertising demand letter, before changing a lawful program or continuing an unlawful one, and before any internal discussion of a competitor's brand is committed to writing.

Sources

●      Deltona Transformer Corp. v. The NOCO Co., No. 24-13590 (11th Cir. Aug. 4, 2026), via Justia

Disclaimer

This post discusses publicly reported legal developments for general informational purposes. It is not legal advice, it does not create an attorney client relationship, and it does not reflect the firm's position in any pending matter. Outcomes depend on the specific facts and the governing law of the relevant jurisdiction.

Your Demand Letter Can Be a Jurisdictional Contact

The short answer

On April 17, 2026, the Eleventh Circuit reversed a Miami federal court and held that allegedly tortious cease and desist letters directed into Florida established personal jurisdiction over the senders, and that the corporate shield doctrine did not protect the individual on whose behalf they were sent. A demand campaign purposefully directed at people or business relationships in a state can expose the sender to suit there when the resulting claim arises out of those letters. That is not a rule that every routine cease and desist letter creates jurisdiction wherever it lands. If you receive one from out of state, the letter may nonetheless be enough to bring the sender to you.

Why it comes up

The demand letter is the cheapest tool in intellectual property enforcement. A trademark owner sends one, the recipient stops, and nothing is filed. The strategy assumes the letter is a communication rather than an act with legal consequences of its own.

It is not. A recipient who does not intend to stop has an alternative to waiting: file a declaratory judgment action and litigate on home ground. Whether that works depends on whether the sender is subject to personal jurisdiction in the recipient's forum, and the letter itself is frequently the only contact.

What the court held

The case arose in the Southern District of Florida and involved the entity that manages rights associated with Frida Kahlo. The district court dismissed for lack of personal jurisdiction. The Eleventh Circuit reversed on two grounds.

The corporate shield doctrine did not apply. That doctrine ordinarily protects an individual from being haled into a forum for acts taken solely in a corporate capacity. The court held it did not shelter the individual defendant here because the letters indicated she was acting in her individual capacity.

Minimum contacts were satisfied under the effects test. An intentional tort aimed at the forum, causing injury in the forum, supplies the contacts the Constitution requires.

Our take: this cuts both ways and both ways are useful

For a Florida business on the receiving end of an out of state demand letter, this decision is a genuine strategic asset. The conventional advice has been to respond, negotiate, and hope. The alternative is to file first, in Florida, for a declaratory judgment of non-infringement, and require the accuser to litigate here. That reverses the leverage entirely: the party that thought it was applying costless pressure is now a defendant in a distant forum, paying local counsel and traveling for hearings.

For a Florida business that sends demand letters, the same decision is a warning, and the practical response is drafting discipline rather than silence.

Send in a corporate capacity and make that unmistakable. The corporate shield failed here because the letters read as personal. Sign on behalf of the entity, in a stated corporate role, on entity letterhead.

Do not assume counsel's signature changes the analysis. In this case the letters were sent by the company's general manager acting as the individual defendant's agent, and that is precisely why the corporate shield did not protect her. Jurisdiction turns on whose conduct was purposefully directed at the forum, not on who signed the letter.

Assume the letter will be an exhibit. Overstatement, threats untethered to any legal theory, and accusations of bad faith all read differently when attached to a declaratory judgment complaint than when read by a frightened recipient.

We should be candid about the limits. This is a fact-bound holding, and courts have long treated demand letters as an awkward jurisdictional basis precisely because the alternative discourages parties from trying to resolve disputes without litigation. A different record, particularly one where the sender acted only through a corporation and the letter was measured, may well come out the other way. This decision does not establish that every demand letter creates jurisdiction. It establishes that some do, which is enough to change how both sides should behave.

What it means practically

Before sending: confirm the entity is the sender, the signer is acting in a corporate role, and the letter states a legal theory rather than a threat.

Before responding: ask whether you would rather litigate in your own forum than the sender's, and whether the letter itself supports jurisdiction there. That question has a two-week answer, not a two-month one, because the sender may file first.

When to call a lawyer

Before you send a demand letter, and within days of receiving one from out of state.

Why this is not a do-it-yourself problem

A demand letter looks like correspondence and functions like a pleading. It fixes the accuser's theory, it can waive or preserve arguments, and as this decision confirms, it can decide where the fight happens. The version a business owner drafts alone tends to overstate the claim, which is useful evidence for the other side, and to omit the corporate framing that keeps the signer out of a distant courtroom. On the receiving end, the choice between responding, ignoring and filing first has a short window and permanent consequences, and it turns on an assessment of the sender's likely forum options that is not intuitive.

Talk to us

HDD Law Firm litigates trademark, trade secret and other intellectual property disputes in the Florida state courts, the Southern, Middle and Northern Districts of Florida, and the Eleventh Circuit. If you have sent or received a demand letter and want to understand your options before the other side files, contact us about your dispute.

Related coverage: the same enforcement calculus applies to bidding on a competitor’s trademark in keyword advertising, where liability turns on what the ad itself says rather than on the bid.

Sources

●      Frida Kahlo Corp. v. Pinedo, No. 24-10293 (11th Cir. Apr. 17, 2026), via Justia

●      The same opinion via CourtListener

Disclaimer

This post discusses publicly reported legal developments for general informational purposes. It is not legal advice, it does not create an attorney client relationship, and it does not reflect the firm's position in any pending matter. Outcomes depend on the specific facts and the governing law of the relevant jurisdiction.