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A towering mistake: Owner of ‘Landmark Hotel’ ordered to pay $43 million for trademark infringement

The former Landmark Hotel will likely wear yet another new name.

A federal judge has approved a nearly $43 million judgment against the owner of the former Landmark Hotel on Charlottesville’s Downtown Mall for trademark infringement and breaching a confidential settlement agreement, permanently preventing the group from using the name “Dewberry”.

Dewberry Engineers Inc., part of Dewberry, a nationwide architectural, construction and engineering firm, filed the lawsuit against The Dewberry Group, the Atlanta-based real estate group that owns the former Landmark, in May 2020 in the U.S. District Court for the Eastern District of Virginia in Alexandria.

The lawsuit was the latest in two decades of legal trouble and stalled development of the barren downtown tower. It was filed after a Daily Progress article in Jan 2020 described a new name for the building, now planned as apartments.

The unfinished skeletal structure remains on Charlottesville’s Downtown Mall, appearing to some as an eyesore and to others as a reminder of the city’s towering economic divide.

It was recently wrapped in a $45,000 mural called “Music Box on Main” by recently minted Friends of Cville Downtown organization. The Dewberry Foundation, associated with the Dewberry Group, donated $10,000 to downtown organization and was listed as a co-sponsor of the mural.

The building’s name was changed from The Landmark to The Dewberry Hotel and then to The Laramore, after Joseph C. “Jack” Laramore, who designed the street-level portion of the building. Then the building’s name was changed again, to Dewberry Living. The moniker is used for the company’s luxury apartment buildings.

However, the new moniker violated a 2007 confidential settlement agreement between the two Dewberry companies, stirring up tensions, according to the lawsuit.

The engineering firm said its longstanding trademarks have “once again come under attack,” while The Dewberry Group accused the company of committing fraud and called for its trademarks to be canceled.

U.S. District Court Judge Liam O’Grady was not swayed by the Dewberry Group’s arguments and granted a summary judgment motion in favor of Dewberry Engineers.

A three-day bench trial in October was held to determine damages, during which O’Grady wrote that it became apparent that the Dewberry Group’s infringement was “intentional and ignored numerous red flags alerting it to the illegality of its conduct.”

“The trial produced further evidence of [the defendant’s] willfulness and bad faith,” O’Grady wrote. “It showed that Dewberry Group encountered, but ignored, a succession of multiple ‘red flag’ facts and circumstances alerting it to the illegality of its conduct, and had ample financial motivation for doing so.”

The scathing 30-page order includes O’Grady’s determination that Dewberry Group namesake John Dewberry and general counsel David Groce did not deliver credible testimony.

O’Grady wrote that “it strains credulity” to believe that Groce could clearly remember minor details, but have no recollection of the Patent and Trademark Office’s “far more significant” denial of the Dewberry Group’s attempts to trademark names that included Dewberry.

“Similarly, the court finds that John Dewberry’s testimony throughout trial was not credible,” O’Grady wrote. “John Dewberry testified that he ‘wasn’t being kept abreast of the [Patent and Trademark Office] application or rejection,’ claiming that ‘I’ve never seen any of this stuff until you showed it to me today.’”

“This professed ignorance is not credible,” O’Grady wrote. “At best, his ignorance amounts to willful blindness.”

Much of O’Grady’s order centers on the confidential settlement agreement from 2007 litigation between the companies, which prevented the Dewberry Group from using the name Dewberry, among other things.

“Consistent with John Dewberry’s pattern of claiming ignorance, when asked at trial whether he had read the [confidential settlement agreement] that he signed, his answer was, ‘probably not,’” O’Grady wrote. “Even if true, however, Dewberry Group remains bound by the [agreement].”

Dewberry testified that he was “not happy” to learn that the agreement did not give both parties “equal rights” to use “Dewberry” for real estate development services because “that’s what [he] wanted it to say.”

“That admission reveals his awareness and dislike of the very [agreement] provisions that [John Dewberry] breached repeatedly, thus providing further evidence of willful and intentional infringement,” O’Grady wrote.

O’Grady wrote that Dewberry tried to blame Groce, claiming his general counsel “may have, you know, been hiding [the letter] from me because he was afraid or something.” O’Grady did not find that credible, either.

Describing the case as “exceptional”, O’Grady awarded Dewberry Engineers nearly $43 million in damages as well as attorney’s fees, which have yet to be calculated. A final judgment and permanent injunction were entered earlier this month.

The injunction largely prevents the Dewberry Group from using the word “Dewberry” in connection with any real estate-related products or services.

The Group is, however, allowed to use the name “Dewberry Capital” in connection with its “promotion, offering and performance of real estate development services as a real estate developer, including purchasing real property, arranging for the construction of commercial and residential buildings and mixed use properties, and leasing and managing properties.”

Source: www.dailyprogress.com

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