20
Apr/14

Bayer v Belmora (FLANAX): Is This The First TTAB ‘Reputation Without Use’ Case?


I’ve been blogging about the doctrine of ‘reputation without use’ since forever. Under what circumstances can the owner somewhere, enforce trademark rights in a jurisdiction where it doesn’t have priority by means of a registration or use in that country. Look from the inside out, that is, consider famous U.S. trademarks, such as FACEBOOK, GOOGLE or TWITTER. If it is the case that the US company wasn’t able to file trademark applications in, say all of the 200 or so trademark jurisdictions in the world, prior to becoming famous (or within 6 months of its first filing date), and some ‘front-runner’ beats them to the Trademark Office in a particular jurisdiction, it seems arguable that the US company should be able to trump the front-runner’s filing, if it can establish that the front-runner chose the mark with full knowledge of the US company’s rights.

Article 6bis of the Paris Convention embodies this equitable argument, providing:

“. . .to refuse or to cancel the registration, and to prohibit the use, of a trademark which constitutes a reproduction, an imitation, or a translation, liable to create confusion, of a mark considered by the competent authority of the country of registration or use to be well known in that country as being already the mark of a person entitled to the benefits of this Convention and used for identical or similar goods. These provisions shall also apply when the essential part of the mark constitutes a reproduction of any such well-known mark or an imitation liable to create confusion therewith.”

Now note that the phrase ‘well known in that country.’ We may use the expression ‘world famous’ in causal conversation but 6bis applies to local fame.

Consider the Malaysian case, Hummel v Lim Yew Sing, [1996] MLJ 7. I can’t find a copy of the decision so I’m citing to my hazy recollection. Plaintiff owned the HUMMEL trademark for ceramic figurines that your grandmother tells you not to break. Defendant was a Malaysian national. Defendant argued that, sure he knew that there was a German company that sold HUMMEL figurines. But he conducted a search of the Malaysian register and saw that there was no filing. Furthermore, he believed that plaintiff did not use and had no reputation (or more to the point, there was no reputation BECAUSE there had been no use).

Put another way, it is irrelevant to the bad faith analysis that defendant had prior knowledge of plaintiff’s rights somewhere – defendant had a good faith belief that plaintiff didn’t have protectable rights in Malaysia. Defendant prevailed.

My friend, Jin Nee Wong has written an article indicating that Malaysian law has been amended to lessen the effect of the HUMMEL case).

However the Malaysian HUMMEL case turned out to be one of the last major cases to hold that there cannot be reputation without use. A few years later, Tiffany prevailed in Singapore in Tiffany v Fabriques de Tabac [1999] 3 SLR 147. I’m familiar with this case because I was one of the instructing attorneys for plaintiff. A Philip Morris subsidiary had filed for TIFFANY for cigarettes prior to Tiffany & Co. either making use or filing in Singapore. We stuffed the record with evidence of the numerous ways Singaporeans would have known of the existence of the New York jeweler prior to defendant’s filing (Audrey Hepburn, etc.) such that a Singaporean, when encountering a pack of TIFFANY CIGARETTES (with stylized Tiffany glass on the packaging, no less) would assume a connection.

Defendant cited Singaporean precedent – there can be no reputation without use.

And in the end the Singaporean Court of Appeal changed the law on the protection of famous marks. VIAGRA helped us maintain our argument. VIAGRA had not arrived in Singapore but there was anticipation. The Court noted that should someone have filed prior to Pfizer, OF COURSE the Singaporean public would be confused, and that was the sort of confusion that 6bis and local equivalents ought to prevent.

So there you have it – the famous mark owner will prevail even if it hasn’t used in the jurisdiction if it can show a local reputation such that the local consumer will be confused by defendant’s use.

Now look outside in. US Courts aren’t buying. A plaintiff, foreign or domestic, has to have use, constructive or actual to be provided under the Lanham Act. The COHIBA case seems to be a pure fact pattern. Defendant, a US cigar company, appears to have targeted the appearance of the famous Cuban COHIBA cigar. No dice. In the Casino du Monte Carlo case, the 4th Circuit had to, IMHO, distort the concept of use in international commerce to argue that the Casino du Monte Carlo, which, inarguably, is in Monaco, was somehow providing casino services that were covered by the Lanham Act.

My reaction to the COHIBA line of cases is that as a matter of fair play, we ought to amend the Lanham Act to recognize Article 6bis. see my guest-rant in the TTABLOG here.

OK, fast forward to Bayer v Belmora. Bayer sells FLANAX pain reliever, reportedly the leading naproxen sodium pain reliever in Mexico (Bayer sells ALEVE, also naproxen sodium, in the US). Bayer doesn’t seem to have filed for nor used FLANAX in the US. Some guy begins selling FLANAX pain reliever in the US, targeting Hispanics, and imitating the Bayer product’s packaging.

Lightning round of You The Judge: ought this be a tort?

OK, this case was complex from a procedural point of view. An awful lot of evidence seems to have been tossed out. John Welch is going to do the blow by blow of the TTAB decision below but here’s my version of the headlines: Bayer has standing because, get this, it has a Mexican trademark registration. That registration has a reputation in the US which needs protecting, therefore Bayer is no mere meddler. I do not see the first sentence surviving unedited by the Fed Cir. Bayer could not proceed under 2(d) because it doesn’t have prior rights. However, Bayer succeeded under Section 14(3) – “if the registered mark is being used by, or with the permission of, the registrant so as to misrepresent the source of the goods or services on or in connection with which the mark is used.” Bayer established that US Flanax was passing itself off as Bayer.

So Bayer appears to have cancelled a US registration based on reputation without use. There have been some civil cases that can be characterized as ‘famous mark’ or ‘reputation without use’ cases, such as Grupo Gigante v Dallo, and cases discussed therein).

One of the anomalies in this case is the standing holding (the bit about the Mexican registration) and another anamoly is Bayer’s apparent decision not to file in the US. If the 14(3) analysis survives Fed Cir scrutiny, does the non-US famous mark owner solve that problem by filing a US trademark application the day before filing a cancellation petition?

Bayer Balmora copy.pdf

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