Owner of an unregistered trademark cannot sue under the US Lanham Act unless he or she can prove its use on the US territory, ruled the US District Court of the Eastern District of Virginia on February 6, 2015, in a case opposing the companies Bayer and Belmora.
This decision overruled the first judgment held by the TTAB in 2009 (Bayer Consumer Care AG v. Belmora LLC, 110 USPQ2d 1623) which ordered Belmora’s trademark cancellation.
Bayer has sold an analgesic product in Mexico under the FLANAX registered trademark. However, Bayer has never marketed or sold a product under the FLANAX mark in the United States nor does he own a U.S. registration for the FLANAX mark. In parallel, Belmora has started selling in 2004 an analgesic tablet in the U.S. under the name FLANAX, which it registered in 2005.
Bayer eventually took legal action against Belmora before the TTAB based on Section 14(3) of US Lanham Act prohibiting the use of a trademark as to “misrepresent the source of the goods or services on or in connection with which the mark is used”.
Bayer’s claim was relying on Section 14(3) of the Act, and also Section 43(a) which allows a trademark owner to take civil action for infringement of an unregistered trademark (S. 43(a)(1)(A)) and false advertising (S. 43(a)(1)(B)).
The TTAB held that Bayer has legitimate interest in protecting its Mexican mark and it had shown that Belmora misused the FLANAX mark in a manner that traded off the reputation and goodwill of Bayer’s mark.
Belmora appealed and the case was eventually brought to the District Court, of the Eastern District of Virginia which pointed forward three major reasons why Bayer did not have a legal standing under Lanham Act.
First, with regards to Section 43(a)(1)(A) of Lanham Act, i.e. infringement of an unregistered trademark, the Court ruled that Bayer did not have any cause of action as its interest did not fall within the “zone of interests” Congress intended to protect, and that its trademark needed to be used in the US commerce in order to establish standing to sue for confusion.
Furthermore, the court reasoned that Bayer failed proving that he suffered an economic injury to its sales or reputation as a result of Belmora’s use of the FLANAX trademark. In particular, the court held that Bayer only plead harms that amounted to “mere confusion,” which “by itself does not constitute reputational injury.”
The court concluded that the plaintiff lacks standing to sue under to Section 14(3) and thus under Section 43(a)(1)(B) of Lanham Act (false advertising).
Finally, the court affirmed the TTAB’s earlier dismissal of Bayer’s claim under Article 6 bis of the Paris Convention protecting “famous” and “well-known” unregistered trademarks, as it is not self-executing and Sections 44(b) and (h) of the Lanham Act do not render Article 6bis of the Paris Convention a ground for contesting trademark registration.
Therefore, this case clearly reaffirms that protection of an unregistered trademark on the US territory under the Lanham Act is recognized under limited circumstances; and clearly banned any possible cause of action under Article 6 bis of the Paris Convention.