Plaintiff, a prominent telecommunications service provider, has established the well-known marks “LIGHTSPEED” and “LIGHTSPEED VOICE” in connection with its telecommunications services. When Defendant opened a business called LIGHTSPEED CONSTRUCTION GROUP, Plaintiff alleged that the mark was nearly identical to its marks in connection with the offering of confusingly similar telecommunications services.
Plaintiff added that such use creates a likelihood of confusion with Plaintiff’s customers.
In this trademark infringement case, Plaintiff sought, among other things, disgorgement of Defendant’s profits during the period of alleged infringement.
Plaintiff obtained an expert report from accountant Kevin Kwan. Defendant claimed that the report simply added two numbers together and filed a motion to exclude his testimony.
Accounting Expert Witness
Kevin Kwan has over 23 years of experience providing consulting and expert witness services in various business disputes, complex commercial litigation matters, and financial investigations. Kevin’s experience includes development of complex financial models, as well as compilation, organization, and analysis of large volumes of historical data through the development of databases.
Discussion by the Court
Defendant did not contest Kwan’s qualifications or reliability, but argued that his testimony would not be helpful to the factfinder.
The Court found that Kwan’s relevant testimony is limited to calculating Defendant’s sales. He also opined that “disgorgement of Defendant’s profits appear[s] to be a reasonable measure of monetary relief in this matter.” But the appropriate form of relief in this case is a legal conclusion, and expert witnesses “may not offer legal conclusions” outside of exceptional circumstances.
Since the Court has already determined that actual damages for injuries like lost profits are inappropriate, Kwan’s support for a disgorgement remedy was—at best—an unnecessary restatement. Besides, Kwan offered that conclusion because he “did not see any particular lost profits that could be claimed” by Plaintiff.
In trademark cases, profits subject to disgorgement are calculated as the infringing sales less the incremental costs associated with those sales. Yet Kwan “did not perform an analysis of Defendant’s incremental costs associated with generating the infringing sales.” He also admitted that he has no opinion on Defendant’s costs. Kwan’s testimony is, therefore, limited to the amount of Defendant’s sales during the alleged infringement.
Kwan’s estimate of Defendant’s infringing sales is the sum of two numbers. The numbers originated from two documents that Defendant produced to show their sales in 2022 and 2023. Kwan added these numbers together to derive Defendant’s total infringing sales. The Court held that simple addition is within the bailiwick of the average lay person and can be presented in closing arguments. Therefore, Kwan’s testimony does not merit admission.
Held
The Court granted Defendant’s motion to exclude the testimony of Kevin Kwan and excluded Kwan from testifying at trial.
Key Takeaways:
- The appropriate form of relief in this case is a legal conclusion, and expert witnesses “may not offer legal conclusions” outside of exceptional circumstances.
- Simple addition is within the bailiwick of the average lay person and can be presented in closing arguments. Expert testimony generally will not help the trier of fact if it “offers nothing more than what lawyers for the parties can argue in closing arguments.”
Case Details:
| Case Caption: | Lightspeed Clec, Inc. V. Lightspeed Construction Group Llc |
| Docket Number: | 8:23cv97 |
| Court: | United States District Court, Florida Middle |
| Order Date: | July 18, 2024 |
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