June 6, 2008

Oregon Seeks To Collect $82 Million of Adidas's $137 Million Punitive Damages Award Against Payless

According to this Bloomberg.com report, the state of Oregon has filed papers to protect its right to collect a share of the $137 million punitive damages award Adidas recovered from Collective Brands, Inc. (the owner of Payless Shoes) in a trademark infringement case.

An Oregon statute provides that 60 percent of all punitive damages awards go to the state. In a case decided earlier this year, the Oregon Court of Appeals recognized the state's right to intervene in a case with a large punitive damages award. In that case, the parties had reached a settlement that did not involve the state. The state, a non-party, appealed the judgment of dismissal, arguing that the parties could not bargain away the state's share of the award. The Court of Appeal, on its own motion, called for briefing on the state's standing to pursue the appeal, and ultimately ruled in favor of the state.