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So there are two things I would like to bring up, not because I disagree with you wholly, but because I think it's worth shedding light on how this problem persists. (For what it's worth, I'm a lawyer, and while I mostly handle commercial work now, I used to focus on IP).


First, the most recurring and simple issue: Litigation is a very expensive and unpredictable meat grinder.

The longer I practice the more I am convinced that the civil court system in America today is used less as a way to administer justice as it is to threaten/fight wars of attrition. Parties in two-party (as opposed to class action) litigation do not go to court so that a judge can find the answer to their issue and grant some award or order - they do it because they are extremely mad and want to destroy the other party. It may start with a genuine legal claim, but things snowball, parties build grudges, and they become less interested in getting their money than in being proven right by a person in a robe. Or they have secondary goals, such as squashing their competition (which is quite effective if your competition is smaller than you - a $1,000,000 company is a great target because they have a lot to lose but they do not have much to fund their fight with). The vast majority, as in more than 95%, of claims are settled out of court because for the most part the law is clear and parties consult lawyers who listen to the facts and tell them "you almost certainly win/lose" so they choose to avoid the costs of the courts and just deal with it privately. When that does not happen, there are reasons for it. Either the case is very complicated and has interwoven claims such that a win is less predictable, or in other cases they just want to cost the other party a large amount of money and send a message (see SLAPP suits, for example). On top of that, jury verdicts are super unpredictable, and the awards they grant even moreso. In cases where parties might experience real economic harms of $1500 you see awards of $15,000,000 (there are whole schools of thought about how to make this happen but it just turns out that no matter how much you ask a jury for, they tend to just give you a little less than that, and there is no real limit or logic to this (this book has some great material on this subject) and judges rarely overrule an award for being too high).


In trademark cases, you often have multiple claims coming at once. For example, they might claim that you are interfering with their mark, and also their trade dress, and also a design patent, and maybe throw in some trumped up copyright claim for good measure, along with a bunch of state law unfair competition claims. So where you propose that the case should be simple, "the only lawsuit that should come up..." etc., it is rarely the case. The extra claims only need to have a glimmer of promise (be "colorable") and they are added so that the other party has to spend more. Trademark cases also require answering whether there is a "likelihood of confusion," and that is an expensive fact to prove/disprove.


Second (and this is particularly prominent in patent and copyright and not well recognized - I hope to publish something about it some day), there is a huge degree of passive collusion (I'll describe later) in litigation, which shapes the precedent, i.e., the law, such that IP laws end up, through court precedent, way stronger than they were when the legislature wrote them. To your point about claiming that the trademark should not have been granted in the first place, there is far less precedent where parties argue that the mark/copyright/patent is invalid than there should be, and this, I believe, is because parties suing each other usually come from the same industry, and it is not in their broader interest to create precedent invalidating the types of IP that those industry participants rely upon. For example, many IP scholars and public critics of IP laws hold the view that there should not be any software patents (and that is arguably the state of the law currently) but who sues each other in software patent cases? Software companies. Do you think software companies want to put law on the books that says software is not patentable? Of course not. In music copyright cases, parties always have to pretend that the industry is not absolutely rife with borrowing of material, and music industry actors almost never use the fair use defense. It's odd, because it is a pretty robust and flexible doctrine. It probably would have saved Robin Thicke a few million in his Blurred Lines lawsuit, but they did not try. Weird. This is, I believe, because the content industry hates fair use, so they don't want more precedent on the books. As a result they end up tiptoeing around the issue and making weird arguments about very specific legal issues that don't make full use of the law. You only see significant changes in the law, like cases going to the Supreme Court, where the parties are not similarly situated, like a pharma company suing a university, or the MPAA suing Sony for making the Betamax player (Sony did not have its hand in movie production at the time), or the RIAA vs. Napster, Viacom vs. (a young, and not making its own shows) YouTube.


TL;DR - The court system really is that expensive, and the "adversarial" system which generates our law is actually filled with collusion.