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U.S. Intellectual Property and New Media Law Update ACPA TRUMPS WIPO BOTH ALPHABETICALLY AND IN COURT Sallen d/b/a J.D.S. Enterprises v. Corinthians Licenciamentos LTDA et al. (1st Cir. 2001) NO GRAY AREAS IN THE GRAY MARKET Vittoria North America, LLC v. Euro_Asia Imports Inc. (10th Cir. 2001) TO BE THRIFTY IS TO BE BLUE In re Thrifty, Inc. (Federal Cir. 2001) LET'S NOT MAKE A FEDERAL CASE OF IT International Armor & Limousine Company v. Moloney Coachbuilders, Inc. (7th Cir. 2001) ACPA TRUMPS WIPO BOTH ALPHABETICALLY AND IN COURT Sallen d/b/a J.D.S. Enterprises v. Corinthians Licenciamentos LTDA et al. (1st Cir. 2001) This is the face-off between The Anticybersquatting Consumer Protection Act ("ACPA") and The Uniform Domain Name Dispute Resolution Policy ("UDRP") for the title in domain name piracy suppression. The ACPA is federal legislation which provides protection for domain name users. The UDRP is an arbitration required in each domain name registration agreement. The Plaintiff lost a UDRP proceeding over the use of a domain name and the domain name was awarded to the Defendant. The Plaintiff then bought an action under the ACPA to declare that in reality it did have the rights in the domain name and the UDRP decision and transfer order were improper. The District Court found it lacked jurisdiction, since the Defendant had disclaimed any intent to bring an action under the ACPA, being content with the transfer of the registration to it under the UDRP. Here, the First Circuit found jurisdiction based on the provision of 15 U.S.C. ' 1114 (2) (D) (v) allowing a domain name registrant whose domain name has been suspended, disabled, or transferred under the UDRP to file a civil action to establish that "the registration or use of the domain name by such registrant is not unlawful under this chapter". The statute specifically provides that the Court may grant injunction relief to the domain name registrant. Given this Section, the First Circuit found that the ACPA specifically created a new right to obtain an injunction for the return of a wrongfully transferred domain name. The question then becomes a constitutional one, i.e., whether the ACPA provision creates an action where no actual controversy exists. However, the Court found that the ACPA did not grant jurisdiction over a mere abstract claim of federal rights, since the Court will be determining the parties' rights to use a particular domain name. Accordingly, the Court reversed and remanded to the District Court for a determination as to whether Defendant's acquisition of the domain name under the UDRP was proper. The decision can be viewed at: http://bluecanary.com/cases.asp?s=1st;case;011197 NO GRAY AREAS IN THE GRAY MARKET Vittoria North America, LLC v. Euro_Asia Imports Inc. (10th Cir. 2001) In this case, the Tenth Circuit interprets one of the murkier provisions of the Tariff Act designed to protect domestic owners of trademarks affixed to goods produced overseas by foreign manufacturers. Plaintiff alleges that the Defendant purchased tires overseas branded with its marks and imported them into the United States in violation of Plaintiff's trademark rights and, accordingly, sued the Defendant under ' 526 of the Tariff Action (19 U.S.C. ' 1526). Essentially, this Section bars unauthorized importation into the United States of goods bearing a registered trademark owned by a citizen, or by a corporation or association created or organized under the law of the United States. In a prototypical grey market case, the victim is a domestic firm that purchased from an independent foreign firm the right to register and use the latter's trademark in the United States and to sell its foreign manufactured products. In this case, the District Court granted summary judgment in favor of the Plaintiff trademark owner. The question before the Tenth Circuit was whether the evidence was insufficient to support summary judgment on two issues (1) whether Plaintiff is the U.S. owner of the trademark in question; and (2) whether the Plaintiff is controlled by the foreign manufacturer and thus not protected under the Act. Plaintiff was a U.S. Company formed to distribute Italian manufactured Vittoria tires in the United States, Canada and Mexico. In return, Vittoria Italy entered into an agreement wherein the Plaintiff received all rights, title and interest to the mark Vittoria in the United States for the express purpose of acting against infringers and unauthorized importers. Thereafter, Plaintiff filed suit against the Defendant for unauthorized importation of Vittoria tires into the United States. The Circuit Court found the fact that the deal was not an arms length transaction and that Plaintiff did not pay dearly for the assignment was not relevant. There was a transfer of ownership. The fact that goods were not transferred as part of the sale did not mean that the transfer was in gross, that is, without the goodwill of the business, since the same goods were sold by Plaintiff as was originally sold by the manufacturer of the tires. The transfer of goodwill requires only that the services be sufficiently similar to prevent consumers of the services offered under the mark from being mislead from established associations with the mark. The only exception to the statute is when the U.S. trademark owner is owned by or had common control with the foreign manufacturer. Here, the Plaintiff and the Italian manufacturer do not have a relationship as a parent or subsidiary nor had they common ownership. While Defendant points to a number of activities taken together with regard to development of new products, distribution, advertising cost, etc., these activities stop short of establishing common control as defined by 19 C.F.R. ' 133.2(d). Accordingly, the lower Court finding was affirmed. The decision can be viewed at: http://bluecanary.com/cases.asp?s=10th;case;006277 TO BE THRIFTY IS TO BE BLUE In re Thrifty, Inc. (Federal Cir. 2001) Thrifty attempted to register as a trademark the color blue used in connection with automobile, truck and recreational vehicle renting and leasing, etc. The applicant claims it intended for the mark to cover the use of the color blue on vehicle rental center signs, vehicles, uniforms and other advertising and promotional material. The drawing showed an outline of a blue building in dotted line. The PTO refused to accept Thrifty's description of the mark because the description did not agree with the mark shown in the drawings (i.e., was not limited to use on a building) and because it described more than one mark. The TTAB affirmed the examiner's refusal, since the mark shown in the drawings was simply the application of color blue to a building, not the color blue in general. On appeal to the Federal Circuit, Thrifty contends the original application was directed to the color blue in general, not limited to placement on building. Accordingly, the claim that the mark covered the use of blue on other objects did not constitute an impermissible material alteration of the mark. Applicant argues that the original drawing showed the building in dotted lines, demonstrating the building was not part of the mark. Applicant also argues that the specimen submitted showed the mark in connection with objects other than in buildings including shuttle buses, uniforms and cars and thus any inconsistency should favor broader coverage. The Court found no inconsistency between the drawing and the specimen, which all showed the color blue used on the building as well as on objects and accordingly felt that In Re ECCS, Inc. was not applicable. The Federal Circuit then found that if the original drawings showing blue on a building could not be extended to other objects, the PTO was correct in rejecting the application. The decision can be viewed at: http://bluecanary.com/cases.asp?s=Fed;case;011111 LET'S NOT MAKE A FEDERAL CASE OF IT International Armor & Limousine Company v. Moloney Coachbuilders, Inc. (7th Cir. 2001) Here, the Seventh Circuit faces the latest in a series of interrelated actions over the rights in a trademark for a limousine, armored car, and custom auto rebuilding business. In 1986 one party sold his business and his trademark (which included his name) to a second party with an accompanying non-compete clause. The parties disagreed as to exactly what trademark rights were transferred. Litigation ensued with decisions in 1989 and 1990 on various matters and a settlement in 1990. More disputes erupted after a non-competition clause expired and the original owner went back into business referencing his original relationship to the company he sold. The trademark purchaser complained and the original trademark owner then sued for declaratory judgment that references to his prior company did not violate Section 43 of the Lanham Act. The Defendant counterclaimed based on violation of the original contract of sale and settlement of the first suit. The District Court concluded that the original owner violated the 1990 settlement agreement. On appeal the Seventh Circuit had a great deal of problems even understanding the Judge's rather cryptic decision which had only a passing relationship to normal syntax. Aside from the English, the Seventh Circuit had even more fundamental problems. They found that the new suit was in reality not a Lanham Act claim but merely a contract dispute where all the litigants were citizens of a single state (Illinois). While the litigants phrase their claims and counterclaims in terms of trademark, the dispute was simply a contract dispute in which trademarks were the subject of the contract. Thus, the Court found there was a lack of a federal question and no diversity, i.e. no jurisdiction. Both parties argued that the Court still had the power to look at the current dispute since it had the supplemental jurisdiction to enforce the 1990 settlement agreement. However, the Seventh Circuit also found the original suit to be one of contract not trademark. Both litigations thus imploded with a likelihood that the entire dispute would end up in State Court. While there must be some lessons to be learned from thirteen (13) years of wasted litigation, I am just not exactly sure what that lesson is. The decision can be viewed at: http://bluecanary.com/cases.asp?s=7th;case;011493 |
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