Lack Of Jurisdiction Foils Trademark Infringement Case

This article explores how the Seventh Circuit vacated a default judgment in a trademark infringement case due to a failure to establish personal jurisdiction. It highlights the importance of documenting transactions and the legal malpractice risks associated with procedural failures in high-volume litigation.

The United States Court of Appeals for the Seventh Circuit held recently that Illinois lacked personal jurisdiction over a company offering products for sale in Illinois through a website. To satisfy the Federal Rules of Civil Procedure and Illinois state law, there must be evidence of actual targeting or completed sales within the forum. Yinnv Liu v. Monthly, No. 25-2074 (7th Cir. 2026). The case arose in an unusual procedural context in which both the plaintiff and the defendant failed to appear or submit pleadings at stages of the litigation.

The Path to Default Judgment for trademark infringement and counterfeiting

In April 2024, Yinnv Liu filed a suit against hundreds of foreign e-commerce entities for trademark infringement and counterfeiting. The defendants failed to appear. The district court entered a default judgment. Finally, in January 2025 defendants appeared and moved to vacate the judgment under Rule 60(b). Then the plaintiff, Liu, failed to respond to the motion or, later, to the appeal.

Seventh Circuit Vacates Judgment Due to Missing Evidentiary Record

The district court initially indicated it would grant the defendants’ motion because Liu failed to respond but ultimately denied the motion, meaning that the default judgment stood. Defendants appealed. Because the plaintiff had not adequately “kept track” of the evidentiary requirements needed to sustain jurisdiction, the Seventh Circuit vacated the judgment.

The record showed it was possible to buy the products in Illinois, but it did not show that anyone had. Accordingly, the case was remanded to the District Court with instructions to dismiss the case against the defendants for lack of jurisdiction.

The High Cost of Failing to Document Jurisdictional Facts

To establish jurisdiction, Liu should have documented transactions in Illinois. Its default judgment—a victory—was rendered useless by its failure to create a record sufficient to establish jurisdiction. Its failure to respond to the motion to vacate might indicate an absence of evidence of jurisdiction, although in that case it should not have pursued its litigation at all.

More likely, because the plaintiff had filed hundreds of cases against e-commerce sites, it could not develop evidence of jurisdiction as to inpidual defendants and just wanted to see how they responded or hoped they would never respond. Or it may have been cost prohibitive to develop evidence against each defendant. Whatever the reason, there was a significant waste of judicial resources on a case that lacked any jurisdictional basis.

The Intersection of Jurisdictional Failure and Legal Malpractice

This case highlights a critical vulnerability in high-volume litigation that can cross the line into legal malpractice. When a law firm pursues hundreds of defendants simultaneously—a practice often seen in “Schedule A” trademark cases—the duty of care to each inpidual case remains absolute. If a victory as significant as a default judgment is overturned simply because counsel failed to “keep track” of basic jurisdictional evidence or failed to respond to a critical Motion to Vacate, it may constitute a breach of professional standards.

In Illinois, legal malpractice occurs when an attorney-client relationship exists, the attorney breaches their duty of care through negligence (such as failing to document transactions necessary for jurisdiction), and that negligence proximately causes financial loss to the client. For a plaintiff, losing an enforceable judgment due to a lack of procedural diligence is not just a strategic setback; it is a potential basis for a professional liability claim.

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