## Facts

- In September 1981, Wheeler Media Services, Inc. (Wheeler) formed a Tennessee corporation, Nashville Network, Inc., and registered the mark “The Nashville Network” with the Tennessee Secretary of State.
- Wheeler never provided services under the mark.
- Wheeler selected the mark without knowledge that WSM, Inc. (WSM)—part of an entertainment group associated with the Grand Ole Opry—claimed prior rights and had used “The Nashville Network” in its broadcasting activities.
- WSM sued Wheeler in federal court alleging service mark infringement and unfair competition under the Lanham Act.
- On March 14, 1983, the district court ordered briefing on whether it had subject-matter jurisdiction, given authority suggesting a federal court could not decide trademark ownership absent federal registration or diversity of citizenship.
- On October 3, 1983, the district judge concluded the court had jurisdiction, while noting that the jurisdiction question had been muddled by WSM’s over-simplification of the issues.
- The district court granted WSM partial summary judgment on ownership of the mark.
- On May 29, 1984, the district court granted summary judgment to WSM on infringement and unfair competition, stating Wheeler’s infringement was not deliberate or willful.
- The district court awarded WSM attorney’s fees under 15 U.S.C. § 1117(a), reasoning Wheeler had unnecessarily prolonged the litigation after September 27, 1982, based on WSM’s settlement offer and deposition testimony suggesting Wheeler could not support its ownership position.
- Wheeler appealed only the attorney’s-fee award.

## Issues

1. Whether the district court erred by awarding attorney’s fees under 15 U.S.C. § 1117(a) on the theory that the case became “exceptional” because defendants continued litigating after September 27, 1982.

## Decision

- The Sixth Circuit reversed the attorney’s-fee award.
- The court held the record did not support treating the dispute as an “exceptional case” under § 1117(a) based solely on defendants’ continued litigation after receiving notice of WSM’s claim.
- The court left the underlying merits judgments (ownership, infringement, and unfair competition) undisturbed because they were not part of the appeal.

## Legal Principles

- Under 15 U.S.C. § 1117(a), attorney’s fees may be awarded to the prevailing party only in “exceptional cases.”
- In the Sixth Circuit, “exceptional” generally requires culpable conduct such as malicious, fraudulent, deliberate, or willful infringement, or similarly egregious litigation conduct.
- A defendant’s decision to contest a trademark dispute through motions and summary judgment—even after receiving notice of the plaintiff’s claim—does not alone establish bad faith or make the case “exceptional.”
- The availability of § 1117(a) remedies extends to Lanham Act unfair competition claims under § 43(a), not only infringement claims under § 32(1); however, fees still require an “exceptional case.”
- A district court abuses its discretion when it awards fees without adequate support for a finding of the required level of culpability.

## Conclusion

WSM prevailed on ownership, infringement, and unfair competition, but the Sixth Circuit reversed the fee award because the record did not show the bad faith, willfulness, or comparable misconduct required to classify the case as “exceptional” under 15 U.S.C. § 1117(a); continued litigation after notice was not enough.


WSM, Inc. v. Wheeler Media Services, 810 F.2d 113 (1987)