Shenzhen Huajie Technology Co., Ltd. v. Shenzhen Leyibei Technology Co., Ltd.,∗

United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Argued March 3, 2026
Decided April 29, 2026
Before
DORIS L. PRYOR, Circuit Judge
JOSHUA P. KOLAR, Circuit Judge
NANCY L. MALDONADO, Circuit Judge
No. 25-2659
SHENZHEN HUAJIE TECHNOLOGY
CO., LTD.,
Plaintiff-Appellant,
v.
SHENZHEN LEYIBEI TECHNOLOGY
CO., LTD.,∗
Defendant-Appellee.
Appeal from the United States District
Court for the Northern District of
Illinois, Eastern Division.
No. 1:22-cv-5630
Steven C. Seeger,
Judge.
O R D E R
Shenzhen Huajie Technology Co., Ltd., (“Huajie”) sued Shenzhen Leyibei
Technology Co., Ltd., (“Leyibei”) for intellectual property infringement and won a
default judgment. In a short order, the district court awarded minimum statutory
damages to Huajie under the Lanham Act’s trademark counterfeiting and
cybersquatting provisions. See 15 U.S.C. § 1117(c), (d). Huajie contends that the court
∗ Defendant Shenzhen Leyibei Technology Co. did not participate in this appeal.
NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with FED. R. A PP. P. 32.1

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abused its discretion by awarding only minimum damages without explanation.
Because Huajie failed to contemporaneously support its desired maximum statutory
damages award, we affirm.
I
Intellectual property lawsuits like this one have flooded the Northern District of
Illinois. In a typical case, the IP holder files trademark or copyright infringement claims
against multiple foreign merchants selling goods on e-commerce platforms like
Amazon or Etsy. See Liu v. Monthly, 170 F.4th 1090, 1092 (7th Cir. 2026); see also Eicher
Motors Ltd. v. P’ships & Uninc. Ass’ns Identified on Schedule “A”, 794 F. Supp. 3d 543, 545
(N.D. Ill. 2025). The plaintiff joins the defendants in a single lawsuit, identifying them in
a sealed document attached to the complaint as “Schedule A,” a practice that gives this
increasingly common and controversial form of litigation its name. Id. Before
defendants are served, a Schedule A plaintiff seeks an emergency temporary restraining
order, prejudgment restraint on the defendants’ assets, and electronic service of process,
all ex parte. Id. Often, defendants never respond or stop participating in litigation, so
the district court must enter default and award statutory damages to the plaintiff with
little or no information about the extent of the infringement.
This case follows much of the typical Schedule A playbook. Since 2017, China-
based Huajie has sold clothing under the “bellelily” trademark on the website
www.bellelily.com. In 2021, Leyibei, also based in China, began selling similar clothing
on its similarly named website, www.bellelliy.com. (The “I” and an “L” are transposed
in the two names.) In 2022, Huajie sued Leyibei under the Lanham Act for trademark
infringement and counterfeiting, see 15 U.S.C. § 1114(1)(a); falsely designating the origin
of its products, see id. § 1125(a); cybersquatting, see id. § 1125(d); and violating the
Illinois Uniform Deceptive Trade Practices Act, see 815 ILCS 510/2.
Huajie moved for summary judgment, contending that Leyibei designed its
trademark and website to resemble Huajie’s, confusing consumers and infringing on
Huajie’s intellectual property rights. Huajie sought maximum statutory damages under
the Lanham Act—$2 million for trademark counterfeiting and $100,000 for
cybersquatting—arguing that the award would deter Leyibei and other counterfeiters
from future infringement.
But by the time Huajie moved for summary judgment, Leyibei had stopped
participating in the litigation and shortly after the motion was filed, Leyibei’s counsel
moved to withdraw. Leyibei never responded to the motion. In light of Leyibei’s non-

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participation, the district court ordered Leyibei to show cause as to why judgment
should not be entered in favor of Huajie. Leyibei never responded to the show cause
order and the district court sua sponte entered default against Leyibei and directed
Huajie to submit a proposed final judgment order. Huajie’s proposed order was
barebones—it did not provide proposed reasoning to justify its desired maximum
statutory damages or reference arguments that Huajie had made in its earlier motion for
summary judgment. The proposed order repeated Huajie’s requests for a permanent
injunction, attorney’s fees, and maximum statutory damages.
The district court issued the final judgment in August 2025. Without making
specific factual findings or detailing its reasoning, the court found Leyibei liable for
willful infringement based on the earlier entry of default, granted Huajie’s requested
injunction, and awarded $1,000 to Huajie for trademark counterfeiting and $1,000 for
cybersquatting—the minimum statutory damages under each provision.1
II
On appeal, Huajie challenges the adequacy of the district court’s explanation for
the award of minimum statutory damages. Huajie contends that even under the
deferential review owed to awards of statutory damages, see Broad. Music, Inc. v. Star
Amusements, Inc., 44 F.3d 485, 487 (7th Cir. 1995), the district court must explain how
and why it used its discretion.
Typically, a district court’s ruling should demonstrate that the court “considered
the factors relevant to its decision and in fact exercised its discretion.” Patton v.
MFS/Sun Life Fin. Distribs., Inc., 480 F.3d 478, 491 (7th Cir. 2007). But district courts need
not address arguments that a party fails to raise or develop. Here, Huajie failed to offer
evidence or arguments in favor of maximum damages, so the district court did not err
by failing to offer a robust explanation of its ruling. Huajie argues that the district court
should have circled back to its motion for summary judgment to search for support for
its damages award. But it was Huajie’s job to make its case for maximum damages on
default to the district court, not the court’s job to search through the record for support.
1 The order in relevant part reads: “Pursuant to 15 U.S.C. § 1117(c)(2), Plaintiff is awarded
statutory damages from Defendant in the amount of $1,000 (one thousand dollars) for willful counterfeit
use of Plaintiff’s Bellelily trademark,” and “Pursuant to 15 U.S.C. § 1117(d), Plaintiff is awarded statutory
damages from Defendant in the amount of $1,000 (one thousand dollars) for willful violation of the
Cybersquatting Act.”

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A word about the procedural posture may be helpful. Default judgments occur
in two stages: “the establishment of the default, and the actual entry of a default
judgment.” In re Catt, 368 F.3d 789, 793 (7th Cir. 2004). The district court’s initial entry of
default established that Leyibei was liable for willful trademark counterfeiting2 and
cybersquatting3 under the Lanham Act. See Domanus v. Lewicki, 742 F.3d 290, 303
(7th Cir. 2014). But the entry of default did not establish that Huajie was entitled to the
amount of statutory damages that it requested under the Act.4 Even after default is
established, “the victor must still prove up damages.” Id.
Huajie did not carry its burden to “establish [its] entitlement to the relief [it]
seeks.” In re Catt, 368 F.3d at 793. After the district court entered default, Huajie needed
to offer evidence and arguments in support of the damages award. See id. But as Huajie
acknowledged at oral argument, its proposed order, unaccompanied by any
contemporaneously filed motion for entry of default judgment, lacked any rationale to
support the maximum award. Although Huajie sought maximum statutory damages in
its earlier motion for summary judgment—arguing that only a substantial award could
compensate it for its losses and deter future misconduct—it failed to direct the court to
those earlier arguments. So Huajie invited the consequence of which it now complains.
True, a district court must explain its decision “to award greater than minimum
statutory damages.” Video Views, Inc. v. Studio 21, Ltd., 925 F.2d 1010, 1017 (7th Cir.
1991), abrogated by Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994) (emphasis added).
Likewise, the evidentiary record must “adequately support[]” an award over the
minimum. Id. Thus, a district court has no basis to award greater than minimum
2 A counterfeit trademark “is identical with, or substantially indistinguishable from,” a
registered trademark, 15 U.S.C. § 1127, and it is a basis for liability if it is “likely to cause confusion, or to
cause mistake, or to deceive,” id. § 1114(1)(a).
3 Cybersquatting, also known as cyberpiracy, is the practice of registering a domain name that is
“identical or confusingly similar” to a distinctive trademark with the “bad faith intent to profit from that
mark.” 15 U.S.C. § 1125(d)(1)(A).
4 The Lanham Act authorizes significant damages. Willful counterfeiters face $1,000 to $2 million
in statutory damages, 15 U.S.C. § 1117(c), while cyberpirates are on the hook for $1,000 to $100,000, id.
§ 1117(d). In both cases, statutory damages are to be awarded “as the court considers just.” Id. § 1117(c),
(d). District courts have wide discretion to award statutory damages, Broad. Music, Inc., 44 F.3d at 487,
and may consider myriad factors, see Chi-Boy Music v. Charlie Club, Inc., 930 F.2d 1224, 1229–30 (7th Cir.
1991) (factors relevant to statutory damages for copyright infringement).

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statutory damages where the plaintiff has not developed an evidentiary record
supporting such an award or has not presented that record to the court. See id. at 1016–
17. As the dissent notes, it may be better practice for district courts to briefly explain
their reasoning in cases like this, but we decline to give Huajie a second bite at the
apple. Instead, we affirm on a basis obvious from the record: nothing immediately
available to the district court was adequate to support a $2 million award.
Because Huajie failed to establish its entitlement to the considerable damages it
requested, we uphold the district court’s award of minimum statutory damages. We
also take this opportunity to remind litigants that the race is not over after the entry of
default. A plaintiff with a default in hand still must support a request for damages with
evidence and argument.
AFFIRMED

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P RYOR , Circuit Judge, dissenting. Plaintiff Shenzhen Huajie Technology Co. sued
Defendant Shenzhen Leyibei Technology Co., asserting a panoply of claims relating to
trademark infringement and cybersquatting in what has become known as “Schedule
A” litigation. After entering default judgment against the Defendant, the district court
awarded Plaintiff minimum statutory damages. Plaintiff appeals. It argues the district
court abused its discretion by entering an order insufficient to permit appellate review
and by awarding statutorily minimum damages. In my view, the majority fails to
grapple with the first to reach the second.
Because the district court’s order is devoid of any explanation for why it
awarded the damages it did, I cannot agree with the majority’s conclusion. Regardless
of Plaintiff’s errors in supporting the damages award it seeks, the district court entered
a ruling insufficient for us to ensure it “considered the factors relevant to its decision
and in fact exercised its discretion.” Patton v. MFS/Sun Life Fin. Distribs., Inc., 480 F.3d
478, 491 (7th Cir. 2007). Accordingly, I respectfully dissent.
I. BACKGROUND
Plaintiff and Defendant are both based in China. Since 2017, Plaintiff sold
clothing under the “bellelily” trademark on the website www.bellelily.com. Four years
later, in 2021, Defendant began selling similar clothing on its website,
www.bellelliy.com. Then, in 2022, Plaintiff sued Defendant under the Lanham Act for
trademark infringement and counterfeiting, falsely designating the origin of its
products, and cybersquatting. 15 U.S.C. §§ 1114(1)(a), 1125(a), 1125(d). Plaintiff also
claimed Defendant violated the Illinois Uniform Deceptive Trade Practices Act. 815 ILL .
C OMP. STAT . 510/2.
Plaintiff moved for summary judgment. In its view, Defendant designed its
trademark and website to resemble Plaintiff’s, confusing consumers and infringing its
intellectual property rights. Plaintiff sought maximum statutory damages under the
Lanham Act. Specifically, it requested $2 million for trademark counterfeiting and
$100,000 for cybersquatting—a practice of registering a domain name that is “identical
or confusingly similar” to a distinctive trademark with the “bad faith intent to profit
from that mark,” 15 U.S.C. § 1125(d)(1)(A). Plaintiff argued in its motion that the award
would deter Defendant and other counterfeiters from future infringement.
While Defendant initially participated in the litigation, shortly after Plaintiff filed
its motion for summary judgment, Defendant stopped participating, and its counsel
moved to withdraw. Defendant never responded to Plaintiff’s motion. Defendant’s non-

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participation caused the district court to order Defendant to show cause as to why
judgment should not be entered in favor of Plaintiff. Like it did with Plaintiff’s motion
for summary judgment, Defendant never responded to the show cause order, and the
district court entered default against Defendant and directed Plaintiff to submit a
proposed final judgment order. Plaintiff’s proposed order sought a permanent
injunction, attorney’s fees, and maximum statutory damages. But Plaintiff’s proposed
order was otherwise missing proposed reasoning to justify its desired damages award
or reference to arguments it made in its earlier motion for summary judgment.
The district court issued the final judgment in August 2025. In relevant part, the
order reads:
…
2. Pursuant to 15 U.S.C. § 1117(c)(2), Plaintiff is awarded statutory damages
from Defendant in the amount of $1,000 (one thousand dollars) for willful
counterfeit use of Plaintiff’s Bellelily trademark.
3. Pursuant to 15 U.S.C. § 1117(d), Plaintiff is awarded statutory damages from
Defendant in the amount of $1,000 (one thousand dollars) for willful violation
of the Cybersquatting Act.
On appeal, Plaintiff argues the district court abused its discretion by providing
an insufficient analysis of the factual findings underlying the award for statutory
damages, and that the district court abused its discretion in awarding statutorily
minimum damages.
II. ANALYSIS
This appeal presents two distinct issues. First, we need to evaluate whether the
district court’s order provides at least some explanation sufficient to exercise appellate
review. Second, we have to decide whether the district court abused its discretion by
awarding statutorily minimum damages. Unlike the majority, I am unable to reach the
second question given the district court’s lack of explanation for its decision, which in
my mind precludes appellate review.
Under the Lanham Act, a plaintiff who holds a trademark that has been infringed
may seek either compensatory or statutory damages; it’s her choice. 15 U.S.C. § 1117(a),
(c), (d). Here, Plaintiff sought statutory damages, which provide $1,000 to $2 million
against willful counterfeiters and $1,000 to $100,000 against cybersquatters.

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Id. § 1117(c)(2), (d). In both cases, damages are to be awarded “as the court considers
just.” Id. § 1117(c)(2), (d).
We typically review a statutory damages award under the Lanham Act for abuse
of discretion, but “the standard for reviewing an award of statutory damages within the
allowed range is even more deferential than abuse of discretion.” Broad. Music, Inc. v.
Star Amusements, Inc., 44 F.3d 485, 487 (7th Cir. 1995). Still, “[w]ithout an explanation
from the district court, we cannot conduct our own evaluation of its exercise of
discretion.” Von Duprin LLC v. Major Holdings, LLC, 12 F.4th 751, 768 (7th Cir. 2021).
There’s the rub. Whenever a district court is required to make a discretionary
ruling on damages, statutory or otherwise, we have to satisfy ourselves that it actually
exercised its discretion before we can decide whether the district court abused its
discretion. See Hatahley v. United States, 351 U.S. 173, 182 (1956) (“[I]t is necessary in any
case that the findings of damages be made with sufficient particularity so that they may
be reviewed.”). Certainly, a district court need not follow “any rigid formula” to
adequately explain its statutory damages decision for an appellate court to conduct
meaningful review. Chi-Boy Music v. Charlie Club, Inc., 930 F.2d 1224, 1229 (7th Cir.
1991). But in making a discretionary decision regarding statutory damages, a court must
sufficiently explain its choice to enable us to determine whether it considered the factors
relevant to its decision and in fact exercised its discretion. See, e.g., id. (“[D]istrict courts
enjoy wide discretion in awarding [statutory damages] and may consider various
factors such as the difficulty or impossibility of proving actual damages, the
circumstances of the infringement, and the efficacy of the damages as a deterrent to
future … infringement.” (citation and internal quotation marks omitted)); Spectrum
Ass’n Mgmt. of Texas, L.L.C. v. Lifetime HOA Mgmt. L.L.C., 5 F.4th 560, 565–66 (5th Cir.
2021) (describing “several factual considerations relevant to [the court’s] review of a
statutory damages award under” the Lanham Act); Emps. Council on Flexible
Compensation v. Feltman, 384 F. App’x 201, 208 (4th Cir. 2010) (upholding statutory
damages award under the Lanham Act where the district court “carefully weighed
several aggravating and mitigating factors before concluding that the defendants’
conduct warranted that award”).
In this case, the district court’s order fails that test. See Smith v. Village of
Maywood, 970 F.2d 397, 399 (7th Cir. 1992) (per curiam) (“[T]his judgment does not
present any of the reasons behind the court’s decision. Such silence prevents effective
appellate review.” (emphasis in original)). The district court’s order provides:
“Pursuant to 15 U.S.C. § 1117(c)(2), Plaintiff is awarded statutory damages from

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Defendant in the amount of $1,000 (one thousand dollars) for willful counterfeit use of
Plaintiff’s Bellelily trademark,” and “Pursuant to 15 U.S.C. § 1117(d), Plaintiff is
awarded statutory damages from Defendant in the amount of $1,000 (one thousand
dollars) for willful violation of the Cybersquatting Act.” The order does not explain
how and why the district court landed on its statutory damages award for willful
trademark infringement ($1,000) or cybersquatting ($1,000), and nothing else in the
record provides any hints. There’s simply no indication the district court exercised its
discretion, which forecloses appellate review. See Freeman v. Franzen, 695 F.2d 485, 494
(7th Cir. 1982) (“While a failure to articulate precise reasons to support an award of fees
does not indicate a fortiori that the district court abused its discretion, here the district
court supplied no reasons to explain its decision. It is not the role of this court to
speculate on the reasons which may have supported the decision. Some explanation of
the decision and consideration of the current result in the case is necessary before we
can address the defendants’ arguments that the district court abused its discretion in
awarding $12,000 in attorneys’ fees.” (internal citation omitted)).
The majority, however, resists this conclusion by assuming, without any basis in
the record, that the district court awarded minimum statutory damages because
Plaintiff failed to prove up its award request. In my view, the district court’s order does
not allow such an inference because it provides no explanation for why it awarded
statutorily minimum damages. Yet, “concerns of due process and the opportunity for
meaningful, if limited, appellate review contemplate that the district court would
provide some explanation” underlying its exercise of discretion. Broad. Music, 44 F.3d at
488 (emphasis in original) (quoting Video Views, Inc. v. Studio 21, Ltd., 925 F.2d 1010, 1017
(7th Cir. 1991)). That did not happen here.
I am also unable to agree with the majority’s reliance on Video Views, 925 F.2d
1010. In that case, we decided that a plaintiff seeking minimum statutory damages did
not need to develop the evidentiary record at all. Id. at 1016–17. On the other hand, if
the plaintiff sought greater than minimum damages, we reasoned that the district court
could award more damages when the record supports that determination. Id. And if the
district court, in resolving the matter, decided to issue greater than minimum statutory
damages, we held that it needed to provide some explanation for why it did so. Id. at
1017. In other words, in Video Views, we reasoned that where a plaintiff seeks minimum
statutory damages, the district court can issue such an award on an undeveloped
record. Conversely, when a plaintiff seeks greater than minimum statutory damages,
and the district court agrees to do so, the district court had to provide some explanation
for the factual findings underlying its exercise of discretion.

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Here, however, we find ourselves in neither situation Video Views envisioned. We
face a plaintiff that sought greater than statutorily minimum damages, but the district
court awarded it only minimum statutory damages without explanation. Nothing about
the chain of reasoning in Video Views erased the obligation of district courts to provide
sufficient reasoning to support an award of minimum statutory damages when a
plaintiff seeks greater than statutorily minimum damages. It appears the majority
conflates the plaintiff’s burden to justify an award requesting greater than statutorily
minimum damages with the district court’s obligation to issue a decision denying this
request with sufficient justification for appellate review.
III. CONCLUSION
For these reasons, I respectfully dissent from the majority’s holding in this case.
While I understand “[i]ntellectual property lawsuits like this one have flooded the
Northern District of Illinois,” a district court must provide some explanation to support
its exercise of discretion in fashioning an award of damages to satisfy due process and
facilitate appellate review, even in Schedule A litigation regarding statutory damages. I
do not mean to insinuate that Plaintiff is entitled to a higher damages award. The
district court may have entered the award it did for the reason the majority provides,
and that reason may not constitute an abuse of discretion as the majority holds. But
instead of speculating why the district court denied the Plaintiff’s request, I would
vacate and remand for it to provide its rationale for us to conduct appellate review.

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