## Facts

- Trademark owners granted Dairy Queen, Inc. exclusive rights to use the “DAIRY QUEEN” trademark in parts of Pennsylvania in exchange for payments totaling \$150,000.
- The trademark owners alleged Dairy Queen defaulted on the payments but continued using the trademark and operating in the territory.
- The complaint sought temporary and permanent injunctions, an “accounting” to determine amounts owed and a money judgment, and interim injunctive relief to prevent Dairy Queen from collecting franchise-related funds pending the accounting.
- Dairy Queen answered with defenses and made a timely demand for a jury trial.
- The district court struck the jury demand, concluding the action was purely equitable or that any legal issues were merely incidental to equitable relief.
- The court of appeals denied mandamus to compel reinstatement of the jury demand, and Supreme Court review followed.

## Issues

1. Whether a timely Seventh Amendment jury demand must be honored when a complaint seeks a money judgment but frames the request as an equitable “accounting” alongside injunctive relief.
2. Whether a district court may deny a jury trial by treating legal issues as “incidental” to equitable claims, or by deeming the case equitable due to defenses or asserted complexity in calculating damages.
3. Whether mandamus should issue to correct the denial of the jury right in this posture.

## Decision

- The Supreme Court unanimously held that striking the jury demand was error.
- The Court ruled that factual issues bearing on breach of contract and trademark infringement, insofar as they support a money judgment, must be tried to a jury when timely demanded.
- The Court held that the court of appeals should have granted mandamus to correct the denial of the jury right.
- The judgment was reversed and the case remanded for further proceedings consistent with the jury-trial requirement.

## Legal Principles

- When legal and equitable claims are joined, any legal issues for which a jury is timely and properly demanded must be submitted to a jury; courts may not dispose of those issues first in equity in a way that defeats the jury right.
- A claim seeking a money judgment is legal in nature for Seventh Amendment purposes even if pleaded as an “accounting”; labeling cannot convert legal damages into equitable relief.
- The “incidental to equity” rationale cannot be used in federal court to deny jury trial on legal issues.
- Traditional equitable accounting is limited to circumstances such as fiduciary relationships or accounts so complicated that legal remedies are inadequate; a straightforward claim for money due under an agreement remains legal.
- The presence of defenses or factual complexity in damages computations does not transform an otherwise legal claim into an equitable one or justify denying a jury.

## Conclusion

The Court held that the Seventh Amendment requires a jury trial on properly demanded legal issues seeking money relief, and that neither the “accounting” label, characterization of legal issues as incidental, nor alleged complexity permits a federal court to strike a jury demand when the complaint includes a legal claim for damages.


Dairy Queen, Inc. v. Wood, 369 U.S. 469 (1962)