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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But first I digress.  I was in a Hard Rock Cafe last month with colleagues who were discussing the rock and roll memorabilia on the wall (that is the decorative theme of that chain), and I expressed admiration for a Duane Eddy guitar in a glass case. My colleagues looked at me like I had three eyes.  I gave a short discourse on Duane Eddy and rockabilly, but even my remark that Duane Eddy was an influence on the early Beatles, drew blank stares.  I asked one colleague, someone from the UK, in his early twenties, to name an early Beatles song and he meekly offered “Penny Lane?” If you don’t roll your eyes at that one, I’m not going to explain.

Anyway, the Beatles played about 300 gigs at the CAVERN CLUB in Liverpool.  It’s where they were ‘discovered’ (but not where they really got going as a live band, which was in the clubs on the Reeperbahn in Hamburg).   In this appeal to the District Court of Nevada from a TTAB decision (below), plaintiff/TTAB petitioner, moved to cancel Hard Rock’s registration for CAVERN CLUB.  There appears to have been breaks in ownership since the club’s opening in 1957, but plaintiff seems to be able to establish that it has operated the club since 1991 (prior to that, petitioner had promoted tours of Liverpool which featured the Cavern Club as an attraction, which promotion reached the U.S.  However that doesn’t seem to be use of CAVERN CLUB as a trademark by petitioner).   Hard Rock filed for an ITU for CAVERN CLUB in 1995.

Petitioner moved to cancel alleging 2(a) ‘false association’ with an ‘institution.’  A textbook 2(a) refusal would be if someone without authorization filed a trademark for, for example, NEW YORK CITY POLICE DEPARTMENT or FBI.  The TTAB decision is fairly straight-forward on why petitioner failed on 2(a).

Petitioner also moved on fraud.  Now,  it is beyond the realm of coincidence that the purveyors of the Hard Rock Cafe, curators of rock and roll history, could not know that there was a Cavern Club in Liverpool.  However the fraud question asks to what extent HRC ‘knew’ that the operators of the Cavern Club had trademark rights in the US.    Interestingly, the TTAB decision doesn’t address whether plaintiff had such rights in the US, it merely holds that HRC didn’t know that they did.

The appeal to the District Court should be interesting.  Plaintiff has added an infringement claim, so it will have the opportunity to establish protectable trademark rights in CAVERN CLUB prior to HRC’s ITU filing date.  Readers of the blog know that the US doesn’t protect reputation without use.  On the other hand, cases such as Casino du Monte Carlo and the Grupo Gigante case (646 F3d 0309), give plaintiff a fighting chance to establish that it had protectable prior rights (if it is correct, for example, that plaintiff promoted the Cavern Club as part of its US advertising efforts in the 1991 to 1995 period).

At that point it seems plausible that plaintiff could establish that CAVERN CLUB is a famous mark, if I’m in the survey and young people aren’t.

John Welch on the TTAB decision here.

A UK music professor criticizes the decision (of course he does) here.

Complaint Cavern Club Nevada//

Ttab Cavern Club 2(a)//


John Welch blogs about a precedental TTAB case holding that Section 44 of the Lanham Act doesn’t create a ‘famous marks’ cause of action here. He reproduces an email I sent to the INTA listserv, suggesting that maybe the Us should amend its act to include a cause of action that US companies have utilized abroad, specifically a cause of action relating to the intentional adoption of a mark that is famous to the US public, even if said mark is not in use in the US.

In general, protectable trademark rights arise in two ways – obtaining registrations, and, in a couple of oddball countries such as the U.S., through use.  There is a third way a trademark can be protected, and it arises under Article 6bis of the Paris Convention, which provides, in part, that Treaty members have the right 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.”

This Article is the source of special protection for famous trademarks.  During the domain name wars this doctrine was attacked on, in my view, misplaced populist grounds, but it has two sound bases in trademark law.  The first is that famous mark doctrine is a logical expansion of and gives flexibility to ‘related goods doctrine.’  Another way of putting it is that a famous mark’s ‘zone of expansion’ is larger than that of a non-famous mark.    I associate NIKE with a wider range of goods than the marks of other sneaker brands.

The second basis is the policy against unfair competition.  Some marks are so famous and so unique (COCA COLA, SONY, AMAZON.COM) that it becomes fair to impute bad faith to a trademark applicant by the mere adoption of that mark.  What is the intent of anyone other than Pfizer who files for VIAGRA on any goods in any country?

One of the wrinkles in 6bis jurisprudence is the expression “well known in that country” (the country where the unauthorized use takes place).  Unaided brand awareness of certain luxury brands may approach 100% in certain zip codes in Manhattan but, outside of duty free stores, awareness may hover around zero in some countries.  If I find a country where the trademark owner has neither used nor filed, can I file in good faith there?  If the jurisprudence is that goodwill can ONLY arise from use, does the trademark owner have protectable rights? This is the “reputation without use” conundrum.

Courts find ways to deal with this.   They may play with the determination as to what part of the populace is relevant.  In the Czech Republic in the late 80’s, someone filed for TIFFANY for jewelry.  I participated in the representation of Tiffany & Co. in a cancellation proceeding.  The reality was that after decades of communism, very few Czech consumers were aware that there was a TIFFANY & CO. (and Tiffany had not sold into the country prior to the filing).

 However, we were able to show that anyone employed in jewelry field would likely have known about the New York company.  For example we produced a Czech jewelry textbook which indicated that a four prong setting was called a TIFFANY setting, named for the NY company.  A Czech book on gems depicted the Tiffany Diamond (which is the largest cut yellow diamond in the world).  We also produced affidavits from Czech jewelers attesting to Tiffany’s fame.

This evidence allowed the Court to rely on Tiffany’s reputation without use, in order to find that the applicant had filed in bad faith.

Other countries simply change their minds.  Singapore had strongly believed that there can be no reputation without use.  In a case that also involved the TIFFANY mark, the High Court acknowledged that in the modern era, knowledge of a mark can arrive in a country before use (the Court used VIAGRA as an example) such that it would be bad faith for third parties to adopt it).

It has been my view that on the whole, the U.S. has not protected non-U.S. marks to the same degree.  To be fair, the fact pattern is less common here, because the U.S. is a desirable high-priority export market.  Nevertheless, the fact pattern is not impossible, particularly in the case of geographically oriented services.  For example the trademark of a famous resort, restaurant or sporting event, may have a reputation here, but no technical trademark use (and the owner may not have gotten around to filing here)

The most notorious case of the U.S. not relying upon reputation without use was the PERSON’S case, 900 F.2d 1565 (Fed Cir 1990).  The applicant freely admitted to visiting Japan, seeing the PERSON’S logo, and filing for an identical version in the U.S.  The U.S. court held that, applicant’s knowledge of Person’s aside, there was no use and no protectable reputation here.

The reluctance to find applicant’s behavior to constitute bad faith. put the U.S. squarely in the camp of such countries as Malaysia.  For example, an applicant had filed for HUMMEL for figurines.  Applicant obviously was aware of the famous HUMMEL mark but had searched and determined in its estimation that there was no use in Malaysia – thus no protectable rights.  Despite prior knowledge of the famous mark, there was no bad faith (note that this was pre-GATT and a Malaysian court might likely hold differently today).

Certain U.S. cases over the  decades do however suggest a U.S. willingness to protect the famous mark.  Recently, the Fourth Circuit gave protection to the mark CASINO DU MONTE CARLO.  It did so however, by creating in my view, a tortured definition of use in commerce, stating in effect that if an American walks into a casino in Monte Carlo, that that is commerce that can be regulated by Congress.  I do not believe that that rationale will be widely followed.  See McCarthy’s, Sections 27.47 and 29.2 for a critique of the case.

Much more plausible is yesterday’s Southern District Of NY decision in Empresa Cubana de Tabaca (Cubatabaco) v. Culbro, (Sweet, J.) (you must choose Southern District of NY and then Judge Sweet to access the decision). A U.S. cigar company adopted the COHIBA trademark, aware of its reputation as a highly regarded Cuban cigar.   Because of the embargo, the Cuban trademark owner obviously had no trademark use in the U.S.  Cubatabaco was able to show significant reputation in the U.S.  In fact, Cigar Aficionado magazine had suggested that COHIBA was the most desired cigar brand in the world.  There was also evidence to suggest that the U.S. defendant had contemplated referring to the Cuban trade dress and planned to invoke Cuban imagery in advertising, even though its cigars were sourced from the Dominican Republic.

The 142 page decision cannot be adequately summarized here.  In short, the Court held that the famous mark doctrine of Article 6bis is ‘subsumed’ by Section 43(a) of the Lanham Act.  COHIBA was held to be a famous mark at the time defendant adopted it.  Importantly, the standard for protection under famous mark doctrine is a different (lower) standard than that under the Federal Trademark Dilution Act.  In my view, this is a clear instance of the U.S. protecting ‘reputation without use.’  Owners of famous foreign restaurants, resorts and events, take note.

For the first and last word on the protection of famous marks, see Mostert, “Famous and Well-Known Marks.” (although at this point, wait for the second edition to come out from INTA soon).

Martin Schwimmer is a partner in Leason Ellis, an IP law boutique in White Plains, NY. His practice is concentrated in the area of U.S. and international trademark law and domain name counseling, prosecution and litigation.
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Here is the topic outline for my “trademarks in review” talk tomorrow night for the IP Committee of the Federal Bar Council. Watch this space for links to reference materials.

I. Failure to function as a mark (I BELIEVE THAT WE WILL WIN)

II. Use in Interstate Commerce (ADD A ZERO)

III. Irreparable Harm/Delay (AT&T THANK YOU)

IV. Nominative Fair Use (CISSP)

V. Scandalous! (SLANTS)

VI. Intermediate Liability (various)


VIII. Damages (OCTANE)

IX. Extraterritoriality/Reputation Without Use (BELMORA)

I blogged previously on the Southern District Court of New York decision in the COHIBA cse, wherein the Court held that the Cuban plaintiff had protectable trademark rights in the COHIBA mark in the U.S. after it showed evidence that its reputation here met the standard under Article 6bis of the Paris Convention for protection as a famous mark.

The Second Circuit has now reversed the District Court holding in Empresa Cubana v. Culbro, 04-2527 (2d Cir Feb 25 2005).  It does not reach the issue as to whether plaintiff’s mark is famous in the U.S. but instead holds that plaintiff, as a Cuban entity, cannot obtain property, that is to say protectable U.S. trademark rights, under the embargo against Cuba.  Thus the claims are dismissed.

This case may be correct on the law but raises concerns.

First, assuming that the lower court’s factual holding that COHIBA is a famous mark in the U.S. is correct, the outcome appears to serve neither the purpose of the embargo nor of the Lanham Act. 

Plaintiff was not seeking the right to use the COHIBA mark in the U.S., only to prevent defendant from using it.  Such an injunction would not bolster the Cuban economy in any meaningful way.  In the meanwhile, the U.S. consumer, presumably aware of the famous Cuban COHIBA mark, will be exposed to defendant’s COHIBA product (that had been marketed at times using Cuban imagery).

Second, there is the issue of equal treatment.  U.S. trademark owners have received the protection of foreign courts not only in the ‘reputation without use’ scenario (see my previous post) but even when external political forces may have prevented the trademark owner from satisfying local conditions otherwise necessary for protection under law.  For example McDonalds was able to protect its mark in South Africa against an interloper during McDonald’s non-use during the apartheid sanction period. 

Then there is the issue of retaliation.  Cuba has certainly appropriated the assets of Cuban businesses, which appropriations led to trademark conflict outside Cuba (such as the HAVANA CLUB matter).  However with regard to Cuban protection of U.S. famous marks, on paper at least, Cuba now offers greater protection to U.S. marks than the other way around.  Cuba is an adherent to the Paris Convention and, in theory, would grant 6bis protection to U.S. famous trademark holders (I would be interested from hearing from anyone who has instructed a 6bis action in Cuba – I came close once but the client changed its mind ). Furthermore, U.S. entities may obtain Cuban trademark protection despite the embargo (although not all owners of famous marks do so). 

Some day Castro will fall off the world’s stage.  We may at that time normalize trade relations with Cuba.  From a policy perspective, the U.S. would perhaps be better off until then if there was a no-use truce of the other country’s marks.  I think we lose out if there’s a free-for-all until then.


flanax 24 packflanax bayer

The U.S. District Court for the Eastern District of Virginia, in a case of first impression, held that Article 6bis of the Paris Convention, the famous marks provision, does not provide trademark rights that are protectable under Section 14(3) (misrepresentation of source), Section 43(a)(1)(A) (infringement of an unregistered mark) and Section 43(a)(1)(B) (false advertising) of the United States Trademark Statute (the Lanham Act).

Although Bayer AG has never used the mark FLANAX in the United States, it alleged that a ‘significant number’ of U.S. consumers were familiar with its Mexican FLANAX brand, and that Belmora LLC’s use of the same mark for the same product had caused confusion in the U.S.

Bayer AG, through a predecessor in interest, has used the mark FLANAX in connection with Naproxen, a prescription analgesic, in Mexico, beginning in 1976. It obtained a Mexican trademark registration for FLANAX. After Naproxen was approved for OTC use in Mexico, a mass-market version of FLANAX was launched in 2001-02.

Belmora, a small U.S. pharmaceutical company seeking to introduce Spanish-language packaging to the U.S. OTC market, learned of Mexican FLANAX. Its investigation determined that Bayer was not selling the product in the U.S., had not filed for U.S. trademark protection, and had not listed its product with the FDA.

Belmora filed a U.S. application for FLANAX for Naproxen tablets in October 2003. Bayer’s predecessor, Hoffman-La Roche, filed a U.S. application for FLANAX in February 2004. Belmora’s application (and later, registration) was cited by the USPTO, and blocked the Bayer application, which it then abandoned .

Belmora began use of FLANAX in early 2004, using a similar font and package color to that used by Bayer FLANAX in Mexico.

Bayer filed a petition to cancel Belmora’s U.S. registration in June, 2007. It originally based its petition on Section 2(d), alleging prior use of a trademark in U.S. commerce (and likelihood of confusion). Its alleged prior use claim was based on a variety of trans-border activities consisting primarily of unauthorized grey goods sales by Mexican-Americans who had purchased Bayer FLANAX in Mexico and then sold it in the United States.

Bayer amended its petition to cancel twice, adding claims under the famous mark provision, Article 6bis of the Paris Convention, and under Section 14(3), which permits cancellation of a registered mark that is used to misrepresent source. The added Section 14(3) claim was based on facts disclosed in discovery, and alleged that Belmora, through use of similar trade dress as well as through certain statements in advertising, had intentionally suggested that it was related to Mexican FLANAX.

The Board ultimately rejected the Section 2(d) claim because Bayer had not made use of the FLANAX trademark in U.S. commerce. It rejected the Article 6bis claim because it concluded that Article 6bis does not create a right of action separate from the provisions of the Lanham Act.

However, the Board ruled in favor of Bayer on its Section 14(3) claim, finding that Bayer owned sufficient goodwill in the FLANAX mark and that such goodwill ‘did not stop at the border.’ [finding that Belmora had used the mark to misrepresent the source of its Naproxen Sodium pain reliever “in a manner calculated to trade in the United States on the reputation and goodwill of petitioner’s mark created by its use in Mexico.”] The Board ordered the cancellation of Belmora’s US registration.

Belmora initially elected to appeal the cancellation ruling to the United States Court of Appeals for the Federal Circuit. Although 15 U.S.C. Section 1071 provided for Bayer to either acquiesce in the selection of the CAFC as the channel for appeal, or to request that Belmora initiate a proceeding in a District Court, Bayer instead initiated its own District Court action in California. Belmora amended its election under 15 U.S.C. Section 1071, requesting a de novo appeal in the Eastern District of Virginia. The Virginia action consolidated Bayer’s claims under Lanham Act Section 43(a)(1)(A) (infringement of an unregistered trademark) and Section 43(a)(1)(B) false advertising, as well as related state claims. Bayer also cross-appealed the rejection of its 6bis claim.

Belmora moved to dismiss Bayer’s Section 14(3) and Section 43(a)(1)(A) claims on the ground that Bayer, under the Territoriality Principle, did not own protectable trademark rights in the U.S. because it had never used the mark in the U.S. Belmora moved to dismiss the Section 43(a)(1)(B) false advertising claim on the ground it was duplicative of the 43(a)(1)(A) claim in that the allegation was actually one of false association, namely that Belmora was falsely claiming an affiliation with Bayer. Finally, Belmora moved for judgment on the pleadings with regard to Bayer’s Article 6bis claim, maintaining that Article 6bis is neither a standalone basis for a cause of action under the Lanham Act nor is it incorporated in other provisions of the Lanham Act. In short, Belmora maintained that Article 6bis does not provide exception to the Territoriality Principle which requires that plaintiff have recognized trademark rights in the jurisdiction whether it seeks to enforce trademark rights.

Bayer argued alternatively that its FLANAX mark was famous in the U.S. and thus eligible for protection under 6bis, or that it owned protectable goodwill because a ‘significant number’ of Mexican-American consumers were familiar with its mark as a result of various cross-border activities such as grey goods, spillover advertising, and travel and immigration between Mexico and the U.S.

The Court stated the question as: Does the Lanham Act allow the owner of a foreign mark that is not registered in the United States and further has never used the mark in United States commerce assert priority rights over the mark that is registered in the United States by another party and used in United States commerce? The Court said no. Holding that neither fame nor ‘significant goodwill’ would constitute a source of priority rights, the Court dismissed the infringement and misrepresentation claims. Furthermore, the absence of prior trademark rights deprived Bayer of standing to pursue the false advertising claims as well.

With regard to the Article 6bis action, the Court noted the ‘overwhelming authority’ that the Paris Convention is not self-executing, and that Congress has implemented portions the treaty through Section 44 of the Lanham Act. Non-U.S. practitioners are likely familiar with Section 44(d) (which implements 6 month Convention priority) and Section 44(e) (which provides for registration based on a registration from a Convention-member country).

Section 44(b) states that nationals of treaty countries are entitled to the benefits of this section under the conditions expressed herein. Furthermore, Section 44(h) provides that treaty country nationals are entitled to effective protection against unfair competition. Bayer argued that this general language imports Article 6bis protections into the Lanham Act. The Court, however, cited the decision of the U.S. Court of Appeals for the Fourth Circuit in Barcelona.com, Inc v. Excelentismo Ayuntamiento de Barcelona, 330 F.3d 616 (4th Cir,. 2003) and the Second Circuit’s decision in ITC Ltd. v Punchgini, 482 F.3d 135 (2d Cir. 2007) (the Bukhara case) to the effect that those provisions give non-U.S. parties rights that are coextensive with, not greater than, those otherwise provided under the Lanham Act.

The Court cited numerous authorities asserting that Congress could not have intended a specific exception to the Territoriality Principle, without explicitly saying so.

Accordingly, Bayer, without use of a trademark in U.S. commerce, did not have legal standing to prosecute its Federal claims, and its misrepresentation, infringement and false advertising claims were therefore dismissed. The state claims were dismissed as well.

Belmora LLC v, Bayer Consumer Care AG and Bayer Healthcare LLC, 1:14-cv-00847-GBL (EDVA Feb. 6, 2015).

Belmora, LLC was represented by Martin Schwimmer, Lauren Sabol and Lori Cooper of Leason Ellis, John Welch of Lando Anatasi, and Craig Reilly, Esq.

belmora v bayer decision EDVA Feb 2015.pdf

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Guest post:
Peter Sloane
Partner, Leason Ellis LLP, White Plains, NY

Inside corporate counsel have plenty of work on their desks. The last thing they are looking for is yet more work. Still, trademarks and other intellectual property are increasingly important as corporate assets. Shareholders routinely consider the value of IP in assessing the strength or weakness of a business. In addition to tackling their day-to-day legal work and putting out fires, in-house counsel should look for ways to streamline and leverage their soft IP assets (i.e., trademarks and copyrights). The following is a list of ten possible steps to consider taking before year-end:

1. Register Your Trademarks

Registering trademarks is the bread and butter of most inside trademark counsel. However, many companies are not large enough to hire dedicated trademark counsel. Corporate counsel at those companies should undertake review of the company’s brands and determine whether any additional trademark filings are warranted. Secondary marks, logos, sound marks, colors and product configurations are just some of the myriad kinds of trademarks available for registration.

In addition to protecting trademarks in the U.S., it is important to protect marks in countries abroad where products are made, where goods area sold (or services rendered), and where counterfeiting may occur. An initial investment in trademark protection can be amortized over the years of registration and is less expensive than paying off a squatter or dealing with infringement litigation.

Building a portfolio of registered trademarks, and providing notice of those registrations in advertising and promotional material (i.e., ABC is a registered trademark of Xyz, Inc.) signals to the outside world that the company is trademark savvy. It is also an assuring sign to potential buyers of the company or its assets that they need not worry as much about the risk of infringement (and seek to retain funds in escrow as a reserve for a claw back provision in the event of trademark litigation).

2. Order a Watching Service

Trademark searching before adoption and filing is all well and good, but searching is retrospective rather than prospective. For the leading brands of a company, inside counsel should consider ordering a watching service, which provides advance notice when confusingly similar marks are published for opposition and affords the opportunity to object to registration.

Do not make rely upon government trademark offices to refuse registration of confusingly similar marks. Many do not even examine applications for confusing similarity. For examine, OHIM, the trademark office of the European Union, does not examine applications on so-called relative grounds. It is, therefore, possible to have two EU registrations for the same mark for the same goods owned by different and unrelated parties. It is the duty of the trademark owner to be vigilant and oppose registration of a confusingly similar mark.

Watching services are relatively inexpensive. Leading trademark research companies like CT Corsearch, Thomson Reuters and CSC Nameprotect offer a variety of different watching options. Also consider using them to watch other soft IP assets like domain names and trade names.

3. Develop Trademark Style Guides

Trademarks, particularly new ones, are like babies in that they need care and nurturing to develop to their full potential. Without proper guidance, they may develop bad habits and become wayward in their activities. That is where a trademark style guide comes in handy.

A trademark style guide illustrates the proper way to use a trademark and includes instructions ranging from the proper font and type size to the affixation of trademark notice. The consistent use of a trademark maximizes its value and reduces the chance of collateral attack by third parties.

Many graphic designers specialize in creating trademark style guides. Each company has its own history and different brand needs, so it is necessary to work hand-in-hand with the designer, preferably in consultation with a trademark lawyer, to develop a style guide uniquely suited to meet the specific needs of the business. Then, continually familiarize new marketing people with the guide so that it becomes an important tool rather than a relic gathering dust (or residing unnoticed on an intranet).

4. Develop Internal Clearance Forms

Whoever handles the legal trademark function for a company should advertise that fact internally so that marketing and others who may create brands know whom to contact before taking any public steps. If employees act unilaterally when it comes to trademark adoption, searching, or filing, it will lead to inconsistent practice, increased expense, and added risk exposure.

Develop trademark clearance forms and distribute them throughout the company (an effective way to centralize a trademark practice). The forms should include key metrics like the mark to search, the reason for selecting the mark, the goods or services of interest, the countries where the mark may be used, and the lead time before commercialization.

Post trademark clearance forms on a corporate intranet to make them readily available for widespread use. Beyond that, periodically notify businesspeople about the availability of the forms, especially as marketing people may turn over fairly regularly.

5. Beef Up the Copyright Portfolio

Copyright is an often-overlooked area of intellectual property protection. Most companies likely have scores of materials entitled to copyright registration. Adding copyright registrations to an IP portfolio is an easy way to establish and measure company assets. At the very least, it is another schedule of assets to attach to merger and acquisition documents, thus evidencing the tangible value of the assets transferred.

Materials amenable to copyright registration include a company website, its advertising and promotional materials, its product packaging, and the like. Recordation with the U.S. Customs and Border Protection is even available if counterfeits or gray goods are an issue.

The U.S. Copyright Office charges only $35 for an application and the filing requirements are minimal. U.S. copyright law encourages early and often filing as statutory damages and attorneys’ fees are only available if an application is filed within three months of publication or before infringement. Also, if the nature of the works change over time, keep in mind the possibility of filing for derivative works to protect newly added material.

One last point to remember about copyright – it is international in scope and immediate in efficacy. You may be able to enforce copyright in, for example, your packaging in a jurisdiction where your trademark applications are still pending.

6. Clean Up Chain of Title Issues

Nothing causes more problems in due diligence than a messy chain of title. There is no time like the present to review trademark applications and registrations to make sure that the chain of title is clear and current.

Make sure that it is possible to trace an understandable chain of title from the current record owner back to the applicant. Assignments nunc pro tunc can be used to fill in gaps, particularly when a prior owner is no longer in business. Also, check with secretary of state records to ensure that the current owner is still an active business entity.

Unreleased security interests are another problem when it comes to due diligence. Most people remember to record security interests against trademarks, but fewer remember to record the release of the security interest down the road.

7. Centralize Agreements And Review Any Licenses

Hard as it may be to fathom, some trademark settlement agreements and co-existence agreements are effectively put in a drawer (literally or proverbially) and forgotten once signed. The mark of an effective trademark practice is to consolidate those agreements in one location so that they can be consulted when needed in the future.

In the past, one could maintain a binder of trademark related agreements. Since most everything is electronic these days, it is more important than ever to main those agreements in an easily accessible electronic format. Some trademark docketing programs even have modules to record trademark agreements.

Where the number of agreements is manageable, it may even be worth reviewing them fresh. Among other things, the other side may have gone out of business or discontinued using its mark. This may result in termination of a co-existence agreement, resulting in one less issue for inside corporate counsel to worry about.

8. Rationalize Outside Counsel Relationships

As companies acquire and divest one another in whole or in part, trademark portfolios come and go. There is often different trademark counsel associated with those portfolios, especially in foreign jurisdictions.

The well-run trademark practice will seek to consolidate those portfolios in one or two counsel in each country. Some companies like to have favored prosecution counsel and preferred litigation counsel. Others will seek to have a back up in case of any conflict of interest.

Consolidating trademark portfolios is a good way to make sure that there are a limited and manageable number of counsel who are familiar with the company and its trademarks. Those outside trademark attorneys can often serve as the eyes and ears of the company on the ground in spotting infringements and recommending steps to better protect the company’s marks.

9. Maintain Evidence Of Fame And Use

Even where marks are famous, courts and trademark offices require proof of fame. It behooves the owner of a famous mark to maintain a record documenting that reputation. The fame file should include documents evidencing the adoption of the mark, the history of use of the mark, advertising and promotion of the mark, and consumer recognition of the mark.

Beyond maintaining a fame file, it is good practice to draft an affidavit of fame. That affidavit can be used in actions around the world and modified as necessary.

Time passes quickly and evidence of fame today may grow stale tomorrow. Consider docketing a future date to review and refresh evidence of reputation. Also, gather evidence across jurisdictions where marks are used outside the U.S.

One last point about fame files: ‘bookmarking’ services such as Instapaper make it easier than ever to keep a clipping file (but don’t forget to save electronic copies – the Web is ephemeral).

10. Develop An IT Policy

Today, electronic discovery is part and parcel of traditional paper discovery in any U.S. litigation. It is generally accepted that electronic discovery represents the most significant cost of the litigation process.

The value of trademarks is lessened if it is too expensive to enforce rights. As a result, it is essential that corporate counsel develop an electronic discovery plan in advance of litigation.

Identify key custodians of trademark related information and documents, and identify where such materials reside on corporate systems. With so many e-discovery vendors, it should be easy enough to find a vendor willing to assess needs and provide cost estimates. They are also often willing to come in and provide a CLE presentation.


There are plenty of other things that in-house corporate counsel can do to more effectively grow and protect their soft IP assets, from making sure that they are using the right docketing program, to establishing an effective domain name policy, to scouring social media for infringements. The above merely represents a sample list of actions to consider taking along the way. The important thing is to at least consider the various issues and to take one concrete step at a time. If you are looking for additional ideas, or if you have any questions, you can reach me at sloane@leasonellis.com.