It is not uncommon for an owner of a well-known foreign trademark to find that an American company is attempting to take advantage of the mark by seeking a trademark registration for it in the United States. Until recently, such a foreign trademark owner had only limited recourse under the Paris Convention for the Protection of Industrial Property, which provides the owner of a famous foreign trademark with priority in the United States over a US registrant, but no basis for cancelling a US registration unless the owner of the foreign mark has used its trademark in the United States.
In April 2014, however, the US Patent and Trademark Office’s Trademark Trial and Appeal Board (TTAB) issued a decision extending the ability of owners of famous foreign marks to enforce their rights in the United States.
In Bayer Consumer Care AG v. Belmora LLC, the TTAB granted Bayer’s petition to cancel Belmora’s registration for the mark FLANAX, even though Bayer was not using—and had no intention to use—its FLANAX mark in the United States. Bayer’s affiliate had been dis- tributing a pain reliever in Mexico under the mark FLANAX since 1976, and it had since become the top-selling pain reliever in that country. Bayer did not use the FLANAX mark in the United States, but rather marketed that same pain reliever in the United States under the mark ALEVE.
Following Bayer’s long-standing use of the FLANAX mark and the popularity of its FLANAX product in Mexico, Belmora obtained a US trademark registration for the mark FLANAX for its own pain reliever. Belmora sold and marketed its FLANAX product to the Hispanic community in the United States, initially in packaging that copied the logo and color scheme Bayer used for its FLANAX product in Mexico. Belmora also repeatedly invoked the reputation of Bayer’s FLANAX mark when marketing its own product in the United States.
Before the TTAB, Belmora first attacked Bayer’s right to seek can- cellation of Belmora’s mark because Bayer did not own a US reg- istration for the FLANAX mark, had not used the FLANAX mark in the United States, and had no plans to use the mark in the United States. The TTAB rejected these arguments, stating that if Belmora “is using the FLANAX mark in the U.S. to misrepresent to U.S. consumers the source of [Belmora]’s products as [Bayer]’s Mexican products, it is [Bayer] who loses the ability to control its reputation and thus suffers damages.”
Integral to the TTAB’s analysis was its finding that, given the size of the Mexican population in the United States, the “reputation of the Mexican FLANAX mark does not stop at the Mexican border.”
Because Bayer alleged injuries to its reputation, the company had the right to pursue the cancellation of Belmora’s registration.
The TTAB then turned to the merits of Bayer’s cancellation claim, which alleged misrepresentation of source. In determining whether Belmora’s FLANAX mark “misrepresent[ed] the source of the goods or services on or in connection with which the mark is used,” the TTAB found that Belmora blatantly misused the FLANAX mark in a manner calculated to trade on the goodwill and reputation of Bayer. As a result, the TTAB ordered the cancellation of Belmora’s regis- tration for FLANAX.
Although establishing trademark rights in the United States typically requires use of the mark in the country, the TTAB’s decision in Bayer indicates that a foreign trademark owner may pursue an alternate basis for asserting US trademark rights, even if it does not use its mark in the United States.
The threshold for demonstrating misrepresentation of source is fairly high, however, as it requires the foreign trademark owner to show that the US trademark owner took steps to deliberately pass off its goods as those of the foreign trademark owner.