Convention's 'famous marks' doctrine not incorporated in Lanham Act

Certain courts and commentators have concluded that Article 6bis of the Paris Convention for the Protection of Industrial Property allows foreign trademark owners to protect their marks in the United States without any domestic use or registration so long as their marks are famous or well-known in that country. This is sometimes referred to as the 'famous marks' doctrine. However, in ITC Limited v Punchgini Inc, the US Court of Appeals for the Second Circuit has held that the Lanham Act affords no such protection.

Since 1977 ITC Limited has operated an internationally-renowned restaurant under the mark Bukhara in New Delhi, India. In the mid 1980s, ITC began using the mark BUKHARA on restaurants in New York City and Chicago, and it obtained a federal registration of the mark for "restaurant services". By the summer of 1997, however, ITC had closed both restaurants.

In 1999, two Indian restaurants began operating in New York City under the names Bukhara Grill and Bukhara Grill II. There were numerous similarities between the Bukhara Grill restaurants and ITC's Bukhara restaurants.

In 2003 ITC began to sell packaged food products in the United States under the BUKHARA trademark. That same year, ITC filed a lawsuit against the Bukhara Grill owners in the US District Court for the Southern District of New York, alleging trademark infringement, unfair competition and false advertising in violation of state and federal law. The district court granted summary judgment in favour of the defendants and ITC appealed.

The Second Circuit affirmed the summary judgment on ITC's federal and state infringement claims, holding that by 1999 ITC had abandoned its rights in the BUKHARA mark for restaurant services. ITC's non-use of its BUKHARA mark in the United States for three consecutive years raised a rebuttable presumption of ITC's abandonment of its mark, which ITC failed to overcome.

The Second Circuit likewise affirmed summary judgment on ITC's false advertising claim, holding that ITC lacked standing to assert such a claim under the Lanham Act. If ITC's interests in using BUKHARA for its packaged foods business or overseas restaurants were protectable under US law, the court held that ITC failed to demonstrate a reasonable basis for believing that such interests were likely to be damaged by the defendants' restaurants.

On the state unfair competition claim, the Second Circuit found existing state law to be insufficient to permit a ruling on whether the famous marks doctrine was applicable. Therefore, the court certified questions to the New York Court of Appeals relating to the viability of this doctrine under state law. If found viable, the state court then must decide how much fame a foreign mark must have to merit protection in the United States. The Second Circuit thereby reserved its decision on the state unfair competition claim pending the state court's ruling.

Had ITC not filed a state unfair competition claim, ITC would have been left with no possibility for relief as the Second Circuit also affirmed summary judgment dismissing ITC's federal unfair competition claim.

Because the court held that ITC had abandoned its BUKHARA mark with the 1997 closure of its US restaurants, ITC argued that it was entitled to seek protection and assert its prior rights in the BUKHARA mark under the famous marks doctrine. In the Second Circuit's opinion, the territoriality principle was cited as a fundamental tenet of US trademark law, which required ITC to support its claim of prior rights through proof that the BUKHARA mark was used in the United States. For guidance, the court reviewed prior decisions holding that the famous marks doctrine was applicable under federal law. However, the court refused to recognize any of these rulings as binding because they relied on either state common law principles or various policy considerations rather than on federal law.

Acknowledging Article 6bis of the Paris Convention as the origin of the famous marks doctrine, the court concluded that the US Congress had not incorporated this doctrine into the Lanham Act. After considering the argument that Sections 44(b) and (h) of the act incorporate the doctrine, the court held that these sections afford foreign nationals only those rights and benefits that are extended to US citizens under the Lanham Act, and that the act does not independently afford any right to famous marks. The court's holding was largely based on a textual analysis of Section 44 (extending the benefits and rights "of this section" or "by this chapter") and Congress's failure to incorporate expressly the famous marks doctrine into the Lanham Act despite having amended this statute on 30 separate occasions.

Blake R Bertagna, Arent Fox LLP, Washington DC