In the

United States Court of Appeals
               For the Seventh Circuit

No. 08-1569

G ABBANELLI A CCORDIONS & IMPORTS, L.L.C.,

                                                    Plaintiff-Appellee,
                                  v.


D ITTA G ABBANELLI U BALDO D I E LIO G ABBANELLI,

                                               Defendant-Appellant.


             Appeal from the United States District Court
        for the Northern District of Illinois, Eastern Division.
                No. 02 C 4048—James B. Zagel, Judge.



      A RGUED JANUARY 21, 2009—D ECIDED JULY 30, 2009




 Before P OSNER, FLAUM, and W OOD , Circuit Judges.
   P OSNER, Circuit Judge. This suit under the Lanham Act,
15 U.S.C. §§ 1051 et seq., grows out of a protracted family
dispute over trademarks. The district judge, on the plain-
tiff’s motion for summary judgment, awarded the plain-
tiff, which we’ll call “American Gabbanelli,” a permanent
injunction, damages, and attorneys’ fees. The defendant,
which we’ll call “Italian Gabbanelli,” appeals.
2                                               No. 08-1569

  American Gabbanelli began life in the mid-1960s as the
U.S. distributor for the predecessor of Italian Gabbanelli, a
manufacturer of accordions in Italy. In 1996 and 1997
American Gabbanelli obtained registered U.S. trademarks
on the name “Gabbanelli” for use on accordions and
began importing accordions designed to its specifica-
tions and manufactured by Italian Gabbanelli and other
companies. In 1999 American Gabbanelli sued Italian
Gabbanelli in an Italian court, complaining about the
Italian company’s using the Internet domain name
www.gabbanelli.com and advertising the Gabbanelli
trademark over the Internet. The defendant won that
suit, which was followed by two more trademark suits
in the Italian court, one by each of the parties.
  The parties settled their differences (they thought!)
later that year by an agreement that gave American
Gabbanelli the exclusive right to use the Gabbanelli mark
in North America and Italian Gabbanelli the exclusive
right to use it in Italy. The agreement provided that “any
further controversy” would be resolved by arbitration
conducted in Italy in the Italian language, with each
party to appoint an arbitrator and the two arbitrators to
appoint a third arbitrator, who would be the chairman
of the arbitration panel.
   A “further controversy” soon arose and each party
appointed an arbitrator. But for unexplained reasons the
third arbitrator has never been appointed and no arbitra-
tion has ever been conducted. Instead, Italian Gabbanelli
filed another suit in the Italian court, in May 2002,
seeking a transfer of American Gabbanelli’s U.S. trade-
No. 08-1569                                                 3

marks to it. Recently that court issued its judgment, and
it is in Italian Gabbanelli’s favor.
   The present suit was filed by American Gabbanelli in
January 2002 in a federal district court in Texas and
charges Italian Gabbanelli with infringing American
Gabbanelli’s U.S. registered trademarks. There was a
change of venue to the district court in Chicago, and
several months later Italian Gabbanelli, though unrepre-
sented by counsel, wrote a letter to the district court
contending that the arbitration clause in the agreement
settling the original Italian litigation barred the court
from exercising jurisdiction over American Gabbanelli’s
suit. The district judge rejected the contention after Italian
Gabbanelli finally retained counsel (see below). Having
filed suit itself (the Italian suit to which we referred
earlier) rather than proceed in arbitration, Italian
Gabbanelli can hardly be heard to complain about its
opponent’s having done the same thing. True, Italian
Gabbanelli could not invoke arbitration before the third
arbitrator was appointed. But if the reason the third
arbitrator was not appointed was that American
Gabbanelli’s arbitrator had refused to cooperate with
Italian Gabbanelli’s arbitrator in picking the third arbitra-
tor, Italian Gabbanelli could have sought relief in the
Italian court for breach of the arbitration clause. It has
sought such relief, in still another suit, but we have not
been told what the ground of that suit is, or its outcome.
  The issue of the effect of the arbitration clause on the
present lawsuit is in any event not jurisdictional. A
person who having agreed to arbitrate instead brings a
4                                                No. 08-1569

suit has broken his contract, and the breach can be
pleaded as a defense to his suit. But even if the defense
is sound, it no more deprives the court of jurisdiction
than a defense based on any other contractual forum-
selection clause would. Scherk v. Alberto-Culver Co., 

, 518-20 (1974); Baltimore & Ohio Chicago Terminal
R.R. v. Wisconsin Central Ltd., 

, 408-09 (7th
Cir. 1998); cf. CIGNA HealthCare of St. Louis, Inc. v. Kaiser,

, 852-53 (7th Cir. 2002); Lloyd v. HOVENSA,
LLC, 

, 272 (3d Cir. 2004); Reynolds Jamaica
Mines, Ltd. v. La Societe Navale Caennaise, 

, 694
(4th Cir. 1956). This is apparent from the fact that parties
to an arbitration agreement can always waive the agree-
ment and decide to duke out their dispute in court,
Grumhaus v. Comerica Securities, Inc., 

, 650-51
(7th Cir. 2000); Cabinetree of Wisconsin, Inc. v. Kraftmaid
Cabinetry, Inc., 

, 389-91 (7th Cir. 1995); Hoxworth
v. Blinder, Robinson & Co., 

, 925-27 (3d Cir.
1992)—which in effect is what happened in this case. So
not only is there no jurisdictional obstacle; there is no
contractual (or for that matter any other) obstacle. Italian
Gabbanelli waived its right to insist on arbitration by
bringing suit upon a “further controversy” between the
parties in violation of the arbitration clause in its settle-
ment agreement with American Gabbanelli.
  The letter challenging the district court’s jurisdiction
was sent, as we said, in July 2002. In October the court
stayed further proceedings pending the outcome of the
Italian suit that Italian Gabbanelli had filed earlier that
year. In May 2005, with the Italian court not yet having
rendered a decision, the district judge became impatient
No. 08-1569                                                  5

and lifted the stay. American Gabbanelli promptly served
Italian Gabbanelli with requests for admission, essentially
asking it to admit liability on all the plaintiff’s trade-
mark claims. The defendant had 30 days to respond. Fed.
R. Civ. Pro. Rule 36(a)(2), (3), (4). In October 2005, months
later, without having responded to the requests for ad-
mission, Italian Gabbanelli finally hired a law firm and
the firm entered an appearance in the case.
  American Gabbanelli moved for summary judgment.
After delays while the parties contested the (nonexistent)
jurisdictional issue, Italian Gabbanelli filed its opposition
to the motion for summary judgment in June 2007.
But having missed the deadline for responding to the
request for admissions it was deemed to have made the
requested admissions. Fed. R. Civ. P. 36(a)(3); Fabriko
Acquisition Corp. v. Prokos, 

, 607 (7th Cir.
2008); Hadley v. United States, 

, 1347-48 (9th Cir.
1995). So when the defendant moved to be permitted
to withdraw the admissions and substitute affidavits
contradicting them, the judge denied the motion and
the grant of summary judgment followed swiftly.
  Italian Gabbanelli had no excuse for ignoring its oppo-
nent’s request for admissions long, long past the dead-
line. Though a small company, it has lawyers in Italy who
could have put it in touch with an American law firm
when it was sued back in 2002. And a law firm did finally
make an appearance for it in October 2005—yet waited
almost two years after that before moving to rescind the
admissions. The excuse that the arbitration clause required
the request for admissions in an American lawsuit to be in
6                                                  No. 08-1569

Italian is frivolous; the defendant’s initial letter, objecting
to the suit, was in English. The district judge was not
required to rescind the admissions, United States v. 2204
Barbara Lane, 

, 129-30 (11th Cir. 1992), and, with
the admissions thus a part of the evidentiary record the
grant of summary judgment in favor of the plaintiff was
inevitable.
  But what about the recent Italian judgment in Italian
Gabbanelli’s favor? The company had tried, before the
appeal was argued, to submit it directly to us, but we
directed that it instead be submitted to the district judge,
with a request that he make it a part of the record, as in
United States v. Ramirez, 

, 167 (2d Cir. 2005).
An American court can take judicial notice of a foreign
judgment, Hilton v. Guyot, 

, 205-06 (1895);
Mike’s Train House, Inc. v. Lionel, L.L.C., 

, 411-12
(6th Cir. 2006); United States v. Garland, 

, 332-34
(6th Cir. 1993), but in most cases (not all—see, e.g., Crockett
v. Hulick, 

, 1188-89 n. 3 (7th Cir. 2008);
Ruvalcaba v. Chandler, 

, 563 n. 2 (7th Cir. 2005);
Dickerson v. Alabama, 

, 1367-68 (11th Cir.
1982)) the sensible procedure is first to lodge it with the
trial court, as in the Ramirez, Train House, and Garland
cases, and that is the usual practice. See also Ennis v.
Smith, 

, 430-31 (1852); Lloyd v. American Export
Lines, Inc., 

, 1188-90 (3d Cir. 1978). The
significance of a foreign judgment for pending litiga-
tion depends obviously on its meaning, which will re-
quire an accurate translation if, as in this case, the judg-
ment was rendered by a court in a non-English-speaking
country. And because the United States is not a signatory
No. 08-1569                                                   7

to any treaty governing recognition of foreign judgments,
Alessandro Barzaghi, “Recognition and Enforcement of
United States Judgments in Italy,” 18 N.Y. Int’l L. Rev. 61,
65 (2005), the significance of the foreign judgment will
depend on a variety of other considerations as well,
having to do with the reliability of the foreign pro-
ceeding for determining the parties’ rights. See Restate-
ment (Third) of Foreign Relations Law § 482 (1987). Some of
those considerations, such as adequacy of notice, are also
best treated as matters of fact because their accurate
determination can benefit from compliance with the
rules of evidence. See Fed. R. Civ. P. 44.1; Twohy v.
First National Bank, 

, 1192-94 (7th Cir. 1985).
  Although Italian Gabbanelli did as we directed and
asked the district judge to add the Italian judgment to
the record, he refused. His ground was that the
company was trying to get him to find facts while the
case was on appeal and jurisdiction over the case had
therefore shifted to the court of appeals. We could have
been clearer, but our intention was to order a limited
remand to give the parties an opportunity to supple-
ment the record with the judgment (and pertinent inter-
pretive materials), which might assist us in deciding the
appeal, as in Seetransport Wiking Trader Schiffarhtsgesellschaft
MBH & Co. v. Navimpex Centrala Navala, 

,
583 (2d Cir. 1993).
  No matter. Because the Italian judgment postdates the
American one, it cannot be pleaded as res judicata, or, so
far as we can see, do anything else to advance Italian
Gabbanelli’s cause. It is more likely that the American
8                                               No. 08-1569

judgment, at least once the defendant has exhausted its
appellate remedies (an essential condition, as we are about
to see), could be pleaded as res judicata in the Italian
litigation, assuming that the Italian litigation has not
yet concluded—that appellate remedies remain unex-
hausted. Although the parties haven’t bothered to tell us
anything about the Italian doctrine of res judicata, our
own research reveals that the Italian doctrine (on which
see Article 2909 of the Italian Civil Code; Enrico Zattoni,
“Some Comparative Reflections on Issue Preclusion in
Civil Cases: Collateral Estoppel and Giudicato Sull
‘Eccezione’,” 41-44 (L.L.M. thesis, Harvard Law School,
Apr. 1992); and Barzaghi, supra, 69-70, 85-88, 95), unlike
the American, does not accord res judicata effect to a
judgment, whether domestic (that is, Italian) or foreign,
until appellate remedies have been exhausted. Spier v.
Calzaturificio Tecnica, S.p.A. WL 200651, at *1-2 (S.D.N.Y.
Dec. 3, 1990); 

; Andrea Bonomi, “The
Italian Statute on Private International Law,” 27 Int’l J.
Legal Information 247, 266-67 (1999).
  It is true that American courts apply the American
doctrine of res judicata even to a foreign judgment of a
nation like Italy that would not treat an American judg-
ment the same way. Restatement, supra, § 481, comment d;
Restatement (Second) of Conflict of Laws § 98 (1971); Richard
W. Hulbert, “Some Thoughts on Judgments, Reciprocity,
and the Seeming Paradox of International Commercial
Arbitration,” 29 U. Pa. J. Int’l L. 641, 642-44 (2008). And
so the fact that the Italian judgment is not final in the
sense of appellate remedies having been exhausted is not
No. 08-1569                                               9

important. But what is important is that it was ren-
dered after the judgment of the district court.
  The Italian judgment in short is a red herring in this
appeal. Italian Gabbanelli’s challenge to liability fails.
  But it has a legitimate grievance concerning the
damages that the district judge awarded—$151,200 in lost
profits plus statutory damages of $500 per infringing
accordion. The latter award is the focus of contention.
The Lanham Act authorizes statutory damages only in
cases in which the violation of the Act takes the form
of using a “counterfeit” mark, § 1117(c)—“a spurious
mark which is identical with, or substantially indistin-
guishable from, a registered mark,” § 1116(d)(1)(B)(ii); see
also §§ 1117, 1127—as distinct from cases in which the
mark is placed on the defendant’s product with the
trademark owner’s consent but the product is then distrib-
uted through an unauthorized channel. Louis P. Petrich,
“Preliminary Injunctions and Temporary Restraining
Orders in Copyright and Trademark Infringement Cases:
The Trademark Counterfeiting Act,” 326 PLI/Pat 499, 570-
71 (1991). For example, a product licensed to be sold only
in Europe but sold in the United States under the licensor’s
trademark would be a “grey market” good rather than a
good sold by means of a “counterfeit” mark. 

Gabbanelli placed the Gabbanelli mark on accordions made
by a company that was not authorized to manufacture
accordions for sale in the United States under the
Gabbanelli name; this made its use of the name counter-
feiting. Idaho Potato Commission v. G & T Terminal
Packaging, Inc., 

, 722 (9th Cir. 2005).
10                                                No. 08-1569

   However, statutory damages may be awarded only in
cases in which compensatory damages are not awarded
for the same violation. 15 U.S.C. §§ 1117(c), (d); Derek
Andrew, Inc. v. Poof Apparel Corp., 

, 699 (9th
Cir. 2008); Twin Peaks Productions, Inc. v. Publications Int’l,
Ltd., 

, 1380-82 (2d Cir. 1993). It is true that
if there are separate violations, the fact that they are
charged in the same case does not preclude an award
of compensatory damages for some of the violations
and statutory damages for others as to which compensa-
tory damages can’t be ascertained or are too slight to
warrant the expense of determining but in which deter-
rence would be served by a money judgment. Cf. Nintendo
of America, Inc. v. Dragon Pacific Int’l, 

, 1010-11
(9th Cir. 1994). But this is not such a case. Both the lost
profits, which are compensatory damages, and the statu-
tory damages pertain to the same accordions that
Italian Gabbanelli sold in violation of American
Gabbanelli’s trademark rights.
  A further problem with the damages award is the
amount of statutory damages that can be awarded in the
case of a counterfeit trademark: “not less than $500 or
more than $100,000 per counterfeit mark per type of
goods or services sold, offered for sale, or distributed, as
the court considers just.” 15 U.S.C. § 1117(c). Per “type
of goods”—not per individual item bearing the counter-
feit mark. 5 J. Thomas McCarthy, McCarthy on Trademarks
and Unfair Competition § 30:95 (4th ed. 2009).
  The damages award must therefore be vacated. The
judgment is affirmed except with respect to that award
No. 08-1569                                              11

and also the award of attorneys’ fees, which the district
court will have to redetermine at the conclusion of the pro-
ceedings on remand.
                     A FFIRMED IN P ART, R EVERSED IN P ART,
                      AND R EMANDED WITH INSTRUCTIONS.




                           7-30-09