Third time is a (partial) charm for Bayer

United States of America
In Bayer Consumer Care AG v Belmora LLC (Case 92047741, April 6 2009), in a precedential decision, the Trademark Trial and Appeal Board (TTAB) has partially granted Belmora LLC’s motion to dismiss Bayer Consumer Care AG’s petition to cancel the registration of the mark FLANAX for use with an analgesic. 
Bayer initially alleged prior use “in connection with the advertising and sale” of its analgesic and likelihood of confusion. The TTAB agreed with Belmora that failure to mention use in the United States rendered the allegations insufficient and allowed Bayer to re-plead. Bayer’s first amended petition again alleged prior use and likelihood of confusion, but added that the mark:
has long been, and is being used in the United States, and, on information and belief, since long prior to the filing date of the application that matured into [Belmora’s registration], consumers have purchased products bearing [Bayer’s] FLANAX mark in the United States.
The TTAB granted Belmora’s motion to dismiss this claim as well. The TTAB concluded that even though consumers might be purchasing Bayer’s product in the United States, the petition failed to allege that the sales were made or licensed by Bayer. 
Bayer’s next and final attempt to plead likelihood of confusion included the allegation that consumers have purchased in the United States goods that were "authorized by" Bayer. Bayer elaborated that the initial sale occurred outside the United States and that third parties then imported the goods into the country, “where they have been resold to consumers”. Moreover, Bayer claimed that consumers travelling abroad and immigrants purchased the goods outside the United States and brought them to the country for use and resale. The TTAB found that this pleading remained deficient for failure to allege that products bearing Bayer’s FLANAX mark which were purchased in the United States were made by Bayer in the United States or distributed by or on behalf of Bayer in the country. The allegation that the relevant goods were "authorized by" Bayer was insufficient. The TTAB dismissed the claim with prejudice, reasoning that Bayer’s three chances to plead its claim were sufficient.
Failure to plead use in the United States also resulted in the dismissal of Bayer’s fraud claim with prejudice and of its claim under Article 6bis of the Paris Convention for the Protection of Industrial Property. As to the latter, the TTAB cited well-established case law that claims under the Paris Convention are not self-executing and do not afford an independent cause of action. Thus, holders of famous marks cannot rely on Article 6bis absent use of the mark in the United States. 
However, the TTAB’s analysis as to Bayer’s claim of misrepresentation of source reached a different conclusion. To plead this allegation properly, Bayer was required to allege “blatant misuse of the mark by [Belmora] in a manner calculated to trade on the goodwill and reputation of [Bayer]”. The TTAB found that Bayer’s detailed allegations of the extent to which Belmora copied the particular display of the FLANAX mark along with the elements of Bayer’s packaging to be sufficient. The TTAB was not convinced by Belmora that Bayer’s failure to allege use in the United States prevented Bayer from having standing to bring such a claim. The TTAB noted that even if the initial purchases took place outside the United States, the downstream sales in the country would result in the misrepresentation alleged by Bayer to be occurring in the United States. Accordingly, Bayer’s case will now continue as to the misrepresentation of source claim.

Karin Segall, Foley & Lardner LLP, New York

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