Petition for Writ of Certiorari — Belmora LLC, et al., Petitioners v. Bayer Consumer Care AG, et al.
Supreme Court briefAug 9, 2021
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No. 21-________
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In The
Supreme Court of the United States
---------------------------------♦--------------------------------BELMORA LLC AND JAMIE BELCASTRO,
Petitioners,
v.
BAYER CONSUMER CARE AG
AND BAYER HEALTHCARE LLC,
Respondents.
---------------------------------♦--------------------------------On Petition For A Writ Of Certiorari
To The United States Court Of Appeals
For The Fourth Circuit
---------------------------------♦--------------------------------PETITION FOR A WRIT OF CERTIORARI
---------------------------------♦--------------------------------LAWRENCE S. EBNER
Counsel of Record
CAPITAL APPELLATE ADVOCACY PLLC
1701 Pennsylvania Ave., NW
Washington, DC 20006
(202) 729-6337
lawrence.ebner@capitalappellate.com
Counsel for Petitioners
================================================================================================================
QUESTIONS PRESENTED
Trademarks are territorial. Their existence, and
the protection that they provide to trademark owners,
do not extend beyond the borders of the nations in
which they are registered or used.
The Lanham Act, 15 U.S.C. § 1051 et seq., provides
protection for trademarks that their owners register
with the United States Patent and Trademark Office
(USPTO) or otherwise use in U.S. commerce. Under
§ 43(a) of the Act, 15 U.S.C. § 1125(a), however,
trademark owners can be sued for false association
and/or false advertising. Along the same lines, section
14(3) of the Act, 15 U.S.C. § 1064(3), authorizes the
filing of a petition with the USPTO to cancel a
registered trademark if it is being used to mispresent
the source of goods.
The questions presented are—
1. Whether, in view of the principle of trademark
territoriality, the zone of interests encompassed by
Lanham Act §§ 43(a) and 14(3) extends to the foreign
owner of a foreign trademark that has not registered
or used the mark in the United States.
2.
Whether, in the absence of an express
limitations period in the Lanham Act, the timeliness
of a § 43(a) suit for false association and false
advertising is governed by the most analogous statelaw statute of limitations, or instead, by laches.
ii
PARTIES TO THE PROCEEDING
Petitioner Belmora LLC was a plaintiff-appellee
below. Belmora LLC and its founder, Petitioner Jamie
Belcastro, were consolidated defendants-appellees in
Respondents’ cross-appeal.
Respondents Bayer Consumer Care AG and Bayer
Healthcare LLC were the defendants-consolidated
plaintiffs-appellants in the cross-appeals below.
Does 1-10 were unnamed consolidated defendants
in Respondents’ cross-appeal, and are not parties in
this petition.
Michelle K. Lee, Director of the U.S. Patent and
Trademark Office, was an Intervenor only in the first
Fourth Circuit appeal. Neither she nor her current
successor is a party in this petition.
RULE 29.6 DISCLOSURE STATEMENT
Petitioner Belmora LLC has no parent company,
and no publicly held corporation own 10% or more of
its stock.
RELATED PROCEEDINGS
1. United States Court of Appeals for the Fourth
Circuit:
(a) Belmora LLC v. Bayer Consumer Care AG
& Bayer Healthcare LLC, No. 18-2183 (Feb. 2, 2021),
987 F.3d 284, reh’g denied Mar. 16, 2021.
iii
(b) Belmora LLC v. Bayer Consumer Care AG
& Bayer Healthcare LLC, No. 15-1335 (Mar. 23, 2016),
819 F.3d 697, cert. denied, No. 16-548 (Feb. 27, 2017),
137 S. Ct. 1202.
2. United States District Court for the Eastern
District of Virginia:
(a) Belmora, LLC v. Bayer Consumer Care AG
& Bayer Healthcare LLC, No. 1:14-cv-00847-CMHJFA, 338 F. Supp. 3d 477 (Sept. 6, 2018).
(b) Belmora LLC v. Bayer Consumer Care AG
& Bayer Healthcare LLC, No. 1:14-cv-00847-GBLJFA, 84 F. Supp. 3d 490 (Feb. 6, 2015).
iv
TABLE OF CONTENTS
Page
QUESTIONS PRESENTED.……………………………i
PARTIES TO THE PROCEEDING……………………ii
RULE 29.6 DISCLOSURE STATEMENT……………ii
RELATED PROCEEDINGS……………………………ii
TABLE OF AUTHORITIES…………………………..vii
OPINIONS BELOW……………………………………..1
JURISDICTION………………………………………….1
STATUTORY PROVISIONS INVOLVED……………1
INTRODUCTION……………………………………….. 3
STATEMENT……………………………………………10
REASONS FOR GRANTING THE PETITION…….20
I. The Circuits Are Divided On Both Questions
Presented……………………………………………...20
A. Four
circuits
follow
three
conflicting
approaches regarding whether the owner of a
foreign trademark can pursue claims under
Lanham Act §§ 43(a) & 14(3)………………….20
B. The circuits also are divided on what governs
the timeliness of § 43(a) claims……………….28
II. The Questions Presented Are Exceptionally
Important……………………………………………...32
CONCLUSION…………………………………………..40
v
Page
APPENDIX
APPENDIX A—Opinion of the U.S. Court of
Appeals for the Fourth Circuit
(Feb. 2, 2021)….....................................................1a
APPENDIX B—Opinion of the U.S. Court of
Appeals for the Fourth Circuit
(Mar. 23, 2016)……………………………………...28a
APPENDIX C—Memorandum Opinion of the U.S.
District Court for the Eastern District of Virginia
(Sept. 6, 2018)………………………………………62a
APPENDIX D—Memorandum Opinion of the U.S.
District Court for the Eastern District of Virginia
(Feb. 6, 2015)……………………………………….82a
APPENDIX E—Order of the U.S. Court of Appeals
for the Fourth Circuit denying petition for
rehearing en banc (March 16,
2021)………………………………………………...141a
APPENDIX F—Order of the U.S. Court of Appeals
for the Fourth Circuit denying petition for
rehearing en banc (May 23,
2016)………………………………………………..144a
vi
APPENDIX G—Order of the U.S. District Court for
the Eastern District of Virginia staying action
while Plaintiffs petition for a writ of certiorari
(Mar. 29, 2021)……………………………………146a
APPENDIX H—Opinion of the USPTO Trademark
Trial and Appeal Board (Apr. 17, 2014) ………148a
vii
TABLE OF AUTHORITIES
Page(s)
Cases
Australian Therapeutic Supplies Pty. Ltd. v.
Naked TM, LLC,
965 F.3d 1370 (Fed. Cir. 2020) ......................... 23
B & B Hardware, Inc. v. Hargis Indus., Inc.,
135 S. Ct. 1293 (2015) ................................. 10, 11
Beauty Time, Inc. v. VU Skin Sys., Inc.,
118 F.3d 140 (3rd Cir. 1997) ............................. 30
Coca-Cola Co. v. Meenaxi Ent., Inc., Canc.
Nos. 92063353 & 92064398 (TTAB June
28, 2021). ........................................................... 39
Dastar Corp. v. Twentieth Century Fox Film
Corp.,
539 U.S. 23 (2003) ............................................. 12
DelCostello v. Int’l Brotherhood of
Teamsters,
462 U.S. 151 (1983) ..................................... 29, 30
Gen. Bedding Corp. v. Echevarria,
947 F.2d 1395 (9th Cir. 1991) ........................... 31
Grupo Gigante S.A. de C.V. v. Dallo & Co.,
391 F.3d 1088 (9th Cir. 2004) ............... 10, 24, 25
viii
Hot Wax, Inc. v. Turtle Wax, Inc.,
191 F.3d 813 (7th Cir. 1999) ............................. 31
Iancu v. Brunetti,
139 Sup. Ct. 2294 (2019) .................................. 11
Industria de Alimentos Zenu, S.A.S. v.
Latinfood U.S. Corp., 2017 WL 6940696
(D.N.J. Dec. 29, 2017). ..................................... 38
Island Insteel Sys., Inc. v. Waters,
296 F.3d 200 (3rd Cir. 2002) ............................. 30
ITC Ltd. v. Punchgini, Inc.,
482 F.3d 135 (2d Cir. 2007)............... 5, 10, 25, 26
Karl Storz Endoscopy-America, Inc. v.
Surgical Techs., Inc.,
285 F.3d 848 (9th Cir. 2002) ............................. 31
Kason Indus., Inc. v. Component Hardware
Grp., Inc.,
120 F.3d 1199 (11th Cir. 1997) ......................... 31
Kehoe Component Sales, Inc. v. Best
Lighting Prods., Inc.,
796 F.3d 576 (6th Cir. 2015) ............................. 31
Lexmark Int’l, Inc. v. Static Control
Components, Inc.,
572 U.S. 118 (2014) ................................... passim
Matal v. Tam,
147 S. Ct. 1744 (2017) ................................. 10, 11
ix
Palleteria La Michoacana, Inc. v. Productos
Lacteos Tacumbo S.A. de C.V.,
No. 17-1075 (D.C. Cir. Aug. 10, 2018) .............. 38
Park ‘N Fly, Inc. v. Dollar Park ‘N Fly, Inc.,
469 U.S. 189 (1985) ....................................... 5, 10
Person’s Co., Ltd. v. Christman,
900 F.2d 1565 (Fed. Cir. 1990). ........ 5, 22, 23, 24
POM Wonderful LLC v. Coca-Cola Co.,
573 U.S. 102 (2014) ........................................... 12
PTO v. Booking.com B.V.,
140 S. Ct. 2298 (2020) ....................................... 10
Romag Fasteners, Inc. v. Fossil, Inc.,
140 S. Ct. 1492 (2020) ....................................... 27
San Miguel Pure Foods Co. v. Ramar Int’l
Corp.,
No 13-55537 (9th Cir. Aug. 27, 2015)
(unpublished)..................................................... 24
Tandy Corp. v. Malone & Hyde, Inc.,
769 F.2d 362 (6th Cir. 1985) ............................. 31
Two Pesos, Inc. v. Taco Cabana, Inc.,
505 U.S. 763 (1992) ........................................... 11
WorkingFilms, Inc. v. Working Narratives,
Inc.,
2021 WL 1196189 (E.D.N.C. Mar. 29,
2021) .................................................................. 39
x
Statutes
Lanham Act, 15 U.S.C. § 1051 et seq.
15 U.S.C. § 1071(b)(4) ....................................... 16
15 U.S.C. § 1114 ................................................ 12
15 U.S.C. § 1117(a) ............................................ 29
15 U.S.C. § 1125(a)
[Lanham Act § 43(a)]................................. passim
15 U.S.C. § 1125(a)(1)(A)
[Lanham Act § 43(a)(1)(A)]. .................. 11, 33, 38
15 U.S.C. § 1125(a)(1)(B)
[Lanham Act § 43(a)(1)(B)]. .............................. 11
15 U.S.C. § 1127 ............................................ 6, 11
15 U.S.C. § 1064(3)
[Lanham Act § 14(3)]................................ passim
15 U.S.C. § 1071(b)
[Lanham Act § 21(b)]......................................... 36
28 U.S.C. § 1254(1) ................................................... 1
28 U.S.C. § 1291 ............................................... 17, 19
28 U.S.C. § 1404(a) ................................................. 16
xi
Other Authorities
Barton Beebe, What Trademark Law Is
Learning from the Right of Publicity, 42
Colum. J.L. & Arts 389 (2019). ........................ 33
Christine Haight Farley, No Trademark, No
Problem,
23 B.U. J. Sci. & Tech. L. 304
(2017) ............................................... 27, 33, 36. 37
Christine Haight Farley, The Lost Unfair
Competition Law, 110 Trademark Rep.
739 (2020) .................................................... 21, 33
Connie Davis Powell Nichols, Article 6bis of
the Paris Convention for Well-Known
Marks: Does It Require Use or a
Likelihood of Consumer Confusion for
Protection? Did Belmora LLC v. Bayer
Consumer Care AG. Resolve This
Question?, 30 Ind. Int’l & Comp. L. Rev.
235 (2020). ................................. 21, 26, 27, 28, 33
Deepa Singh, Comment, Article 6bis of the
Paris Convention: How the United States
Court of Appeals for the Second Circuit is
Violating International Law, 35 Am. U.
Int’l L. Rev. 577 (2020) ..................................... .34
Food and Drug Administration Adverse
Events Reporting System (FAERS)
Public Dashboard (Mar. 31, 2021),
available at https://tinyurl.com/6pyafzb4........ .14
xii
J. Thomas McCarthy, 5 McCarthy on
Trademarks and Unfair Competition
(5th ed.) .............................................. 5, 10, 11, 27
Jones Day, Standing to Enforce Foreign
Trademark Rights After Belmora v.
Bayer Certiorari Denial, Commentaries
(Mar. 2017), available at
https://tinyurl.com/bpzahkf7............................. 35
Mark P. McKenna, Property and Equity in
Trademark Law, 23 Marq. Intell. Prop.
L. Rev. 117 (2019)............................................. .34
Mark P. McKenna & Shelby Niemann, 2016
Trademark Year in Review, 92 Notre
Dame L. Rev. 112 (2016). .................................... 7
Su Li, Note, Belmora LLC v. Bayer
Consumer Care AG: Unfair Competition
as an Alternative Approach to Penetrate
the Territorial Principle in U.S.
Trademark Law, 31 Berkeley Tech. L.J.
1145 (2019) ....................................................... .34
Wee Jin Yeo, Belmora LLC v. Bayer
Consumer Care AG—The Well-Known
Marks Doctrine Reconsidered, 73 Wash.
& Lee L. Rev. Online 188 (2016)....................... 35
xiii
White House Office of Trade and Mfg.
Policy, How China’s Economic
Aggression Threatens the Technologies
and Intellectual Property of the United
States and the World (June 2018) ..................... .6
PETITION FOR A WRIT OF CERTIORARI
Petitioners Belmora LLC and Jamie Belcastro
respectfully request the Court to issue a writ of
certiorari to review the judgments of the U.S. Court of
Appeals for the Fourth Circuit in this litigation.
OPINIONS BELOW
The Fourth Circuit’s 2021 opinion is reported at
987 F.3d 284. App. 1a-27a. The Eastern District of
Virginia’s 2018 opinion is reported at 338 F. Supp. 3d
477. App. 62a-81a. The Fourth Circuit’s 2016 opinion
is reported at 819 F.3d 697. App. 28a-61a. The
Eastern District of Virginia’s 2015 opinion is reported
at 84 F. Supp. 3d 490. App. 82a-140a. The USPTO
Trademark Trial and Appeal Board (TTAB) opinion is
published at 110 U.S.P.Q.2d 1623. App. 148a-186a.
JURISDICTION
The Fourth Circuit denied Belmora’s petition for
rehearing on March 16, 2021. App. 141a-143a. This
Court’s jurisdiction is invoked under 28 U.S.C.
§ 1254(1).
STATUTORY PROVISIONS INVOLVED
Section 43 of the Lanham Act, 15 U.S.C. § 1125,
states in relevant part as follows:
False
designations
of
origin,
descriptions, and dilution forbidden
(a) Civil action
false
2
(1) Any person who, on or in connection
with any goods or services, or any
container
for
goods,
uses
in
commerce any word, term, name, symbol,
or device, or any combination thereof, or
any false designation of origin, false or
misleading description of fact, or false or
misleading representation of fact, which—
(A) is likely to cause confusion, or to cause
mistake, or to deceive as to the affiliation,
connection, or association of such person
with another person, or as to the origin,
sponsorship, or approval of his or her
goods, services, or commercial activities by
another person, or
(B) in commercial advertising or
promotion, misrepresents the nature,
characteristics, qualities, or geographic
origin of his or her or another person's
goods, services, or commercial activities,
shall be liable in a civil action by any
person who believes that he or she is or is
likely to be damaged by such act.
Section 14 of the Lanham Act, 15 U.S.C.
§ 1064, states in relevant part as follows:
Cancellation of Registration
A petition to cancel a registration of a
mark, stating the grounds relied upon,
may, upon payment of the prescribed fee,
be filed as follows by any person who
3
believes that he is or will be damaged
...
(3) At any time if the registered mark
. . . is being used by, or with the permission
of, the registrant so as to misrepresent the
source of the goods or services on or in
connection with which the mark is used.
INTRODUCTION
This appeal presents the Court with an ideal
opportunity to address two fundamental questions of
trademark law that continue to divide the circuits,
create significant legal and commercial uncertainty
for owners of U.S. trademarks, and expose American
businesses to anticompetitive Lanham Act attacks by
foreign corporations.
Petitioner Belmora, a small, Virginia-based
pharmaceutical company, applied for, and in
February 2005 obtained, a U.S. trademark
registration for FLANAX, an FDA-approved, over-thecounter (i.e., non-prescription) analgesic containing
naproxen sodium. Belmora uses the FLANAX name
in commerce throughout the United States,
particularly in Hispanic neighborhoods, where
Belmora’s Flanax Pain Reliever Tablets are sold with
unique bilingual packaging and labeling for the
benefit of Spanish-speaking consumers. In addition,
Belmora’s trademarked name, its distinctive,
registered “cupped hands” logo, and its specially
designed medical pictographs appear on the
packaging of the company’s Flanax products, which
4
also include Flanax Liniment and Flanax Cough
Lozenges. See flanaxusa.com. 1
Respondent Bayer Consumer Care AG, a Swiss
corporation, acquired the Mexican trademark for
FLANAX from Hoffmann-La Roche in September
2005, and since that time has used the FLANAX name
to sell, through a Mexican affiliate, a high-strength,
over-the-counter naproxen sodium product in Mexico,
where Syntex, an unrelated company, introduced
Flanax to Mexican consumers in 1976. Neither Bayer
Consumer Care AG nor any other subsidiary of its
German parent, Bayer AG, ever has registered or
used, or attempted to register or use, the FLANAX
name in the United States. Instead, a different Bayer
AG subsidiary, Respondent Bayer Healthcare LLC,
markets naproxen sodium products in the United
States under the brand name ALEVE.
Since 2007 Respondents (“Bayer” unless otherwise
indicated) have pursued Lanham Act actions intended
to put Belmora out of business. The Lanham Act
questions presented by this appeal arise from the two
published Fourth Circuit opinions issued in this longrunning litigation. See App. 1a-27a & 28a-61a.
The first question is whether the owner of a
foreign trademark that has deliberately chosen not to
use or register the mark in the United States—here,
the name FLANAX—is entitled to bring false
association and false advertising (i.e., unfair
1 This Petition utilizes all-caps when referring to a trademark
(e.g., FLANAX), and initial-caps when referring to the product
itself (e.g., Flanax).
5
competition) claims under Lanham Act § 43(a), 15
U.S.C. § 1125(a), and to file a trademark cancellation
petition under § 14(3), 15 U.S.C. § 1064(3), on the
theory that its foreign trademark has been damaged
by a U.S. company that has followed the procedures to
obtain a U.S. registration for the same mark and uses
that mark to sell products exclusively in the United
States.
The recurring question of what rights, if any,
§§ 43(a) and 14(3) afford owners of foreign trademarks
is an issue that has divided at least four circuits,
including the Federal and Fourth circuits, where
many trademark appeals are heard. It is an issue that
implicates one of U.S. trademark law’s first principles:
that trademark protection is territorial, i.e., that
“because a trademark has a separate legal existence
under each country’s laws, ownership of a mark in one
country does not confer upon the owner the exclusive
right to use that mark in another country.” ITC Ltd.
v. Punchgini, Inc., 482 F.3d 135, 155 (2d Cir. 2007);
see also Park ‘N Fly, Inc. v. Dollar Park ‘N Fly, Inc.,
469 U.S. 189, 198 (1985) (the Lanham Act provides
“national protection of trademarks”); Person’s Co.,
Ltd. v. Christman, 900 F.2d 1565, 1568-69 (Fed. Cir.
1990) (“The concept of territoriality is basic to
trademark law; trademark rights exist in each
country solely according to that country’s statutory
scheme.”); J. Thomas McCarthy, 5 McCarthy on
Trademarks and Unfair Competition § 29.1 (5th ed.)
(World priority—Territoriality principle) (“Under the
territoriality doctrine, a trademark is recognized as
having a separate existence in each sovereign
6
territory in which it is registered or legally recognized
as a mark.”).
This Court never has addressed the right to sue a
U.S. trademark owner for unfair competition under
Lanham Act §43(a), or to petition the USPTO for
trademark cancellation under § 14(3), against the
backdrop of the trademark territoriality principle.
In Lexmark International, Inc. v. Static Control
Components, Inc., 572 U.S. 118 (2014), the Court
identified a two-part test (zone of interests and
proximate cause) for determining whether a
particular plaintiff falls within the class of plaintiffs
that Congress authorized to sue for false advertising
under § 43(a). See id. at 129, 132, 139. But Lexmark
involved claims brought by one U.S. company against
another. The Court referred to the Lanham Act’s
statement of intent concerning regulation of
commerce “within the control of Congress,” id. at 131
(quoting 15 U.S.C. § 1127), but was not called upon to
consider the trademark territoriality question
presented by this appeal—whether the “zone of
interests” covered by § 43(a) (and by § 14(3)) extends
to claims brought by the owner of a foreign trademark
that has neither registered the mark nor used it, or
seeks to do so, in the United States.
This issue potentially affects a multitude of
registered trademark owners across the entire
spectrum of U.S. businesses and industries that may
be targeted by foreign competitors, particularly
competitors supported by economic behemoths such as
China, which is engaged in “economic aggression
[that] now threatens . . . the U.S. economy.” W.H.
7
Office of Trade and Mfg. Policy, How China’s
Economic Aggression Threatens the Technologies and
Intellectual Property of the United States and the
World (June 2018), Part I. At the very least, the
circuits’ conflicting views invite forum shopping by
multinational corporations like Bayer, which on the
pretense of alleged damage to their foreign
trademarks (e.g., Mexican FLANAX), seek to utilize
the Lanham Act for the purpose of extinguishing or
suppressing competition against the Americanbranded products (e.g., ALEVE) that they sell in the
United States.
In its 2016 opinion the Fourth Circuit held that
“the Lanham Act’s plain language contains no
unstated requirement that a § 43(a) plaintiff have
used a U.S. trademark in U.S. commerce to bring a
Lanham Act unfair competition claim.” App. 49a.
Although the court of appeals purported to heed
Lexmark’s “primary lesson” that “courts must
interpret the Lanham Act according to what the
statute says,” App. 44a, the Fourth Circuit’s decision
was utterly oblivious to the trademark territoriality
principle.
This startling and profound failure
overlooks the Court’s teaching in Lexmark that “a
straightforward question of statutory interpretation”
does not require that a statute—and specifically
§ 43(a)—be “[r]ead literally,” but instead, should be
interpreted “in light of . . . relevant background
principles.” Lexmark, 572 U.S. at 129. The principle
of trademark territoriality is unquestionably a
background principle that is relevant to any
interpretation of § 43(a). See, e.g., Mark P. McKenna
8
& Shelby Niemann, 2016 Trademark Year in Review,
92 Notre Dame L. Rev. Online 112, 122 (2016) (“Few
concepts are more fundamental in trademark law
than the notion that rights are territorial in nature.”).
Ignoring the principle of trademark territoriality,
the Fourth Circuit held that Bayer can proceed under
Lanham Act §§ 43(a) and 14(3) merely based on
allegations that sales of its Mexican FLANAX in
Mexico are adversely affected by Belmora’s use of the
FLANAX mark within the United States along the
Southern border. See App. 51a-52a. Although Bayer’s
flimsy and speculative economic and reputational
harm is narrowly focused on Hispanic consumers who
supposedly “buy the Belmora FLANAX in the United
States instead of purchasing [Bayer’s] FLANAX in
Mexico,” id. at 51a, it is hardly a coincidence that
Belmora’s FLANAX directly competes against Bayer’s
ALEVE for Hispanic-American consumers in 15,000
retail outlets throughout 40 States and Puerto Rico.
Petitioners filed a timely petition for a writ of
certiorari after the Fourth Circuit issued its 2016
opinion. The International Trademark Association
(“INTA”) supported Belmora’s petition, explaining in
its amicus brief that “this case presents critical
questions about standing to assert Lanham Act
claims,” and that the “Fourth Circuit’s ruling widens
an already-existing split of authority among the
Circuit Courts of Appeals on the issue of whether a
foreign trademark owner has standing to pursue
claims under the Lanham Act.” INTA Br. at 3 (No. 16548) (emphasis added). INTA urged this Court “to
provide clarity and guidance on an issue of great
9
importance to trademark owners,” id. at 4, but the
Court denied review.
Although the USPTO’s Director argued against
review, her brief recognized that “[i]f the district court
enters a judgment against petitioners on remand,
they will have the opportunity to raise the issues they
currently press, together with any other issues that
may arise from the further proceedings, in a single
petition for a writ of certiorari.” Br. for Fed. Resp. at
24 (No. 16-548). This is that petition.
The second fundamental question presented by
this appeal is whether the limitations period for
bringing § 43(a) claims is governed by the most
analogous state-law statute of limitations or by
laches. In its second opinion, rendered in February
2021, the Fourth Circuit held, contrary to other
circuits’ opinions, that “laches, rather than a statute
of limitations, is the appropriate defense to
. . . § 43(a) claims.” App. 4a. But engrafting a vague,
flexible laches standard onto § 43(a) would enable
foreign or multinational corporations that have
elected to market American-branded rather than
foreign-branded products in the United States to
launch Lanham Act suits as anticompetitive weapons
virtually whenever products sold by U.S. trademark
owners pose marketplace threats. This type of
Lanham Act abuse appears to be Bayer’s strategy for
promoting Aleve in U.S. Hispanic neighborhoods,
where that product and Belmora’s Flanax compete for
a rapidly growing number of Hispanic consumers.
10
The Court should grant certiorari and bring clarity
and uniformity to both of these important and stillunresolved questions of U.S. trademark law.
STATEMENT
1. a. The Lanham Act is the “foundation of
current federal trademark law.” Matal v. Tam, 147 S.
Ct. 1744, 1752 (2017). It was enacted against the
backdrop of centuries-old common-law trademark
protection. See id. at 1751; Park ‘N Fly, 469 U.S. at
194. This included the principle of territoriality,
which “is basic to American trademark law,”
Punchgini, 482 F.3d at 155, and “has a long history in
the common law.” Grupo Gigante S.A. de C.V. v. Dallo
& Co., 391 F.3d 1088, 1097 (9th Cir. 2004); McCarthy,
supra, § 29.1. “United States trademark rights are
acquired by, and dependent upon, priority of use . . .
The territoriality principle requires the use to be in
the United States for the owner to assert priority
rights to the mark under the Lanham Act.”
Punchgini, 482 F.3d at 155.
“Though federal law does not create trademarks,
Congress has long played a role in protecting them.”
B & B Hardware, Inc. v. Hargis Indus., Inc., 135 S. Ct.
1293, 1299 (2015) (internal citation omitted).
“[F]ederal trademark protection, supplementing state
law, ‘supports the free flow of commerce’ and ‘foster[s]
competition.’” PTO v. Booking.com B.V., 140 S. Ct.
2298, 2302 (2020) (quoting Matal, 137 S. Ct. at 1752).
“It helps consumers identify goods and services that
they wish to purchase, as well as those they want to
avoid.” Matal, 137 F.2d at 1751.
11
Trademarks include product names as well as
symbols. See 15 U.S.C. § 1127. “Without federal
registration, a valid trademark may still be used in
commerce.” Matal, 137 S. Ct. at 1752. But “[u]nder
the Lanham Act, the PTO administers a federal
registration system for trademarks [that] gives
trademark owners valuable benefits.”
Iancu v.
Brunetti, 139 Sup. Ct. 2294, 2297 (2019); see also
B & B Hardware, 135 S. Ct. at 1317 (“Registration is
a creature of the Lanham Act, which confers
important legal rights and benefits on trademark
owners who register their marks.”) (internal quotation
marks omitted).
b. Section 43(a) of the Lanham Act, 15 U.S.C.
§ 1125(a), “creates two distinct bases of liability: false
association, § 1125(a)(1)(A), and false advertising,
§ 1125(a)(1)(B).” Lexmark, 572 U.S. at 122. “Most of
the [Act’s] enumerated purposes are relevant to falseassociation cases; a typical false-advertising case will
implicate only the Act’s goal of protecting persons
engaged in commerce within the control of Congress
against unfair competition.” Id. at 131 (internal
punctuation omitted) (citing 15 U.S.C. § 1127).
“While Lanham Act § 43(a)(1)(A) does not explicitly
require that the plaintiff be the owner of a protectable
mark, the vast majority of plaintiffs suing under this
subsection do own a valid mark” in the United States.
McCarthy, supra, § 27:13; see Matal, 137 S. Ct. at 1752
(“even if a trademark is not federally registered, it
may still be enforceable under § 43(a)”); Two Pesos,
Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768 (1992)
(“[I]t is common ground that § 43(a) protects
12
qualifying unregistered trademarks, and that the
general principles qualifying a mark for registration
under § 2 of the Lanham Act are, for the most part,
applicable in determining whether an unregistered
mark is entitled to protection under § 43(a).”);
compare 15 U.S.C. § 1114 (civil action for
infringement of registered trademarks).
In addition, § 43(a) “creates a federal remedy that
goes beyond trademark protection.” POM Wonderful
LLC v. Coca-Cola Co., 573 U.S. 102, 147 (2014)
(internal quotation marks omitted). That “broader
remedy” is a “cause of action for unfair competition
through misleading advertising or labeling.” Id. But
Ҥ 43(a) does not have boundless application as a
remedy for unfair trade practices [and] can apply only
to certain unfair trade practices prohibited by its
text.” Dastar Corp. v. Twentieth Century Fox Film
Corp., 539 U.S. 23, 29 (2003) (internal quotation
marks omitted). Thus, “to come within the zone of
interests in a suit for false advertising under [§ 43(a)],
a plaintiff must allege an injury to a commercial
interest in reputation or sales.” Lexmark, 572 U.S. at
131-32. Similarly, to demonstrate proximate cause, “a
plaintiff suing under [§ 43(a)] ordinarily must show
economic or reputational injury flowing directly from
the deception . . . that occurs when deception of
consumers causes them to withhold trade from the
plaintiff.” Id. at 133. Thus, “the cause of action is for
competitors, not consumers.” POM Wonderful, 573
U.S. at 147.
c.
The Lanham Act contains no express
limitations period governing the filing of unfair
13
competition claims under § 43(a). In contrast, § 14(3),
15 U.S.C. § 1064(3), provides in relevant part that “[a]
petition to cancel the registration of a mark” can be
filed with the USPTO “[a]t any time” on the grounds
specified in that provision, including “if the registered
mark is being used by . . . the registrant so as to
misrepresent the source of the goods [on] which the
mark is used.”
2. a. Respondent Bayer Consumer Care AG
purchased the rights to the Mexican FLANAX
trademark in September 2005 from Hoffman-La
Roche AG, which had acquired the original Mexican
trademark owner, Syntex, in 1994. App. 6a n.3; 168a169a. Syntex began selling Flanax in Mexico in 1976.
App. 168a. Since 2005, a Bayer affiliate, Bayer de
Mexico, S.A. de C.V., has distributed Flanax in
Mexico, where it is a “top-selling pain reliever.” App.
5a; 168a. Mexican Flanax, however, is sold over-thecounter to Mexican consumers at a high strength (275
mg per tablet) that is approved by the FDA only for
prescription use in the United States. The FDA has
approved non-prescription (over-the-counter) sale and
use of Belmora’s Flanax and Bayer’s Aleve at the
lower strength of 220 mg per tablet.
In the United States, Respondent Bayer
Healthcare LLC acquired the rights to ALEVE from
Proctor & Gamble, and began distributing that overthe-counter naproxen sodium product here in 1994.
Respondents explained to the Fourth Circuit that
“Bayer has made a conscious business decision not to
compete against itself by offering its FLANAX
medicine in the United States.” Br. for Appellants at
14
46, Belmora LLC v. Bayer Consumer Care AG & Bayer
Healthcare LLC, 819 F.3d 697 (4th Cir. 2016) (No.151335). Bayer complained, however, that “Belmora’s
FLANAX products compete directly with [Bayer
Healthcare’s] ALEVE products.” Id. at 12.
b.
Petitioner Jamie Belcastro, a registered
pharmacist, established Belmora LLC in 2002 “to
provide a user-friendly menu of OTC drug products for
common ailments to U.S. residents of Hispanic
background.” App. 167a. “Given the familiarity with
FLANAX among a large subset of consumers in the
United States, Belmora saw an opportunity to sell
naproxen sodium pain relievers under the FLANAX
name to American consumers.” App. 5a. Belmora was
motivated in part by the fact that high-strength
Mexican Flanax—a strength not approved by the FDA
for over-the-counter use in the United States—
nonetheless is being illegally imported by third
parties and used by some Hispanic-American
consumers who have experienced serious adverse
effects that have been reported to the FDA. See App.
20a (“Given the widespread availability of Bayer’s
FLANAX in Mexico, it is small wonder that the
product has occasionally made it way across the
border.”); see also FDA Adverse Events Reporting
System (FAERS) Public Dashboard (listing serious
cases involving U.S. consumers’ use of Bayer’s
Flanax). 2
Available at https://tinyurl.com/6pyafzb4 (data reported as of
March 31, 2021) (search for “Flanax naproxen”).
2
15
In October 2003 Belmora petitioned the USPTO to
register the FLANAX mark. App. 6a. USPTO granted
Belmora’s trademark registration for FLANAX in
February 2005—7 months prior to Bayer Consumer
Care AG’s acquisition of the Mexican FLANAX
trademark. Id. Meanwhile, a U.S. affiliate of
Hoffmann-La Roche AG had filed a competing
application with the USPTO, see App. 6a n.3., which
refused that application since Belmora’s had been
filed first. After Hoffman-La Roche failed to submit
any evidence or arguments in response to the refusal,
the USPTO deemed the company’s application
abandoned. App. 6a.
Utilizing bilingual (Spanish and English)
packaging and labeling, and Spanish advertising,
Belmora began selling its FDA-approved Flanax Pain
Reliever Tablets in 2004, primarily in neighborhoods
with 10% or higher minority populations. App. 5a-6a;
32a. In addition, Belmora’s trademarked name, its
distinctive, copyrighted “cupped hands” company logo,
and its specially designed medical pictographs appear
on the packaging of the company’s Flanax products,
which also include Flanax Liniment and Flanax
Cough Lozenges. See flanaxusa.com.
3. In June 2007 Bayer Consumer Care AG
petitioned the USPTO’s Trial and Appeal Board
(TTAB) under Lanham Act § 14(3) to cancel Belmora’s
FLANAX registration. App. 6a. Seven years later, in
April 2014, and following a hearing, the TTAB issued
a decision cancelling the registration. App. 148a186a.
The TTAB found that although Bayer
Consumer Care AG does not have a U.S. trademark
16
registration for FLANAX, or sell a product with that
name in the United States, it had standing to petition
for cancellation of Belmora’s FLANAX registered
trademark. App. 171a. Further, the TTAB granted
the cancellation petition based on a finding that
Belmora “is using the mark FLANAX so as to
misrepresent the source of the goods on which the
mark is used.” App. 186a.
4. Belmora has continued to sell its products in the
United States, using the FLANAX name, bilingual
packaging and labeling, and Spanish-language
advertising, throughout the course of this litigation.
a. In July 2014 Belmora challenged the TTAB’s
decision by filing a district court suit against Bayer
Consumer Care AG in the Eastern District of Virginia
under 15 U.S.C. § 1071(b)(4). A month earlier, both
Respondents sued Belmora in California under
Lanham Act § 43(a) and corresponding state law for
false association and false advertising. Over its
objection, Bayer’s district court suit was transferred
under 28 U.S.C. § 1404(a) from the Central District of
California to the Eastern District of Virginia, and then
consolidated with Belmora’s suit. See Civil Minutes,
Bayer Consumer Care AG v. Belmora, LLC, No. 2:14cv-04433 (C.D. Cal. July 11, 2014), Doc. 37 at 5
(“Plaintiffs’ filing of an action against Defendants in a
forum approximately 3000 miles from both their own
and Defendants’ headquarters, raises the potential
that Plaintiffs chose an inconvenient forum to unfairly
increase Defendants’ defense costs and obtain an
advantage in this litigation. The interests of justice
17
therefore weigh in favor of transfer to the Eastern
District of Virginia.”).
Citing Lexmark’s zone of interests/proximate cause
test, see 572 U.S. at 129, 132, the district court
granted Belmora’s motion to dismiss Bayer’s § 43(a)
claims (and also Bayer’s pendent California state-law
claims). App. 84a-85a. The district court held that
the Lanham Act does not “allow the owner of a foreign
mark that is not registered in the United States and
further has never used the mark in United States
commerce [to] assert priority rights over a mark that
is registered the United States by another party and
used in United States commerce.” App. 84a. The
court explained that allowing Bayer to proceed “would
eviscerate the territoriality principle of trademark
law; a principle that has been accepted by the
Supreme Court for nearly one hundred years and
remains essentially unassailable in each circuit court
except for the Ninth Circuit.” App. 122a.
For the same reason, the district court reversed the
TTAB cancellation decision rendered under § 14(3).
App. 136a; 140a.
b. Bayer appealed to the Fourth Circuit under 28
U.S.C. § 1291. Reversing the district court, the panel
held in its 2016 opinion that “the Lanham Act’s plain
language contains no unstated requirement that a
§ 43(a) plaintiff have used a U.S. trademark in U.S.
commerce to bring a Lanham Act unfair competition
claim.” App. 49a. Relying on Lexmark, the court of
appeals then concluded that Bayer had adequately
pleaded § 43(a) unfair competition claims, App. 56a,
and remanded the case to the district court for further
18
proceedings.
According to the Fourth Circuit,
although Belmora’s Flanax is sold in thousands of
retail outlets throughout the nation, Bayer satisfied
Lexmark’s zone of interests and proximate cause
requirements by alleging that its sales of Mexican
Flanax are adversely affected by Mexican consumers
who “cross into the United States and may purchase
Belmora FLANAX here before returning to Mexico,”
and by “Mexican-Americans [who] may forego [sic]
purchasing the FLANAX they know when they cross
the border to visit Mexico.” App. 52a.
Noting that Ҥ 14(3) pertains to the same conduct
targeted by § 43(a) false association actions,” the
panel, “[a]pplying the framework from Lexmark,” also
concluded that “the Lanham Act authorizes [Bayer
Consumer Care AG] to bring its § 14(3) action against
Belmora.” App. 60a, 61a. The Fourth Circuit denied
rehearing en banc, App. 144a-145a, and this Court
denied Belmora’s petition for a writ of certiorari. 137
S. Ct. 1202 (2017).
c. On remand Belmora filed Lanham Act and
state-law counterclaims against Bayer, and the
parties filed cross-motions for summary judgment.
App. 69a-70a.
The district court granted both
Belmora’s and Bayer’s summary judgment motions,
and dismissed the litigation. App. 81a.
As to Bayer’s unfair competition claims, “[b]ecause
the Lanham Act does not contain an express statute
of limitations, the [district] court follow[ed] the
traditional practice of borrowing the most analogous
statute of limitations from state law”—in this case,
the law of California, where Bayer originally filed its
19
§ 43(a) claims. App. 72a. The court held that
“[w]hether a three or four-year statute of limitations
is applied in this case is immaterial,” because Bayer’s
“filing of this action misses the statute of limitations
by almost a decade.” App. 72-73a; id. at 73(a) (“There
are at least six different dates that establish that
Bayer knew or should have known of its Lanham Act
rights.”). For this reason district the court concluded
that “Bayer’s claims fail.” App. 75a.
In addition the district court dismissed each of
Belmora’s counterclaims for lack of adequate
evidence, App. 75a-80a, and affirmed the TTAB’s
trademark cancellation determination on the ground
that Belmora had not offered any new evidence that
would require a de novo review of the TTAB record.
App. 81a.
d. Bayer again appealed to the Fourth Circuit, and
Belmora filed a cross-appeal, under 28 U.S.C. § 1291.
The court of appeals held in its February 2021 opinion
that applying the most analogous state statute of
limitations is the “incorrect legal standard” for
determining the timeliness of Bayer’s § 43(a) claims.
App. 16a. Instead, the panel held that “laches is the
appropriate defense to § 43(a) claims.” App. 15a. The
court vacated the grant of summary judgment to
Belmora and remanded to the district court to
determine whether Bayer’s § 43(a) claims “are barred
by laches and to make any further factual findings to
support that determination.” App. 16a. The court also
remanded for a district court determination as to
whether the California limitations period for Bayer’s
state-law unfair competition claims was tolled while
20
Bayer’s cancellation petition was pending before the
TTAB. App. 18a.
In addition the court of appeals affirmed the
district court’s dismissal of Belmora’s counterclaims,
App. 18a-24a, and also the TTAB’s trademark
cancellation decision, which the United States
supported as amicus curiae. App. 27a. Belmora’s
timely petition for rehearing en banc was denied.
App. 141a-143a.
5. At Belmora’s request, the district court has
entered an Order staying further proceedings while
Belmora appeals to this Court. App. 146a-147a.
REASONS FOR GRANTING THE PETITION
I. The Circuits Are Divided On Both Questions
Presented
A. Four circuits follow three conflicting
approaches regarding whether the owner
of a foreign trademark can pursue claims
under Lanham Act §§ 43(a) & 14(3)
In its 2016 opinion the Fourth Circuit held—
without anywhere acknowledging the principle of
trademark territoriality—that Lanham Act §§ 43(a)
and 14(3) extend to owners of foreign trademarks that
do not use, or have any intention of using, their foreign
marks in the United States. See App. 45a, 49a, 59a60a. The ensuing five years only have solidified the
inter-circuit divisions, and perpetuated the resultant
marketplace uncertainty, regarding whether §§ 43(a)
and 14(3) leave U.S. trademark owners vulnerable to
21
the anticompetitive efforts of foreign trademark
owners such as Bayer.
A prominent intellectual property law professor
recently explained that
[i]n Belmora, the central issue was the
extent of Section 43(a)’s unfair competition
protection in the absence of a protectable
mark. One may wonder how such a
staggeringly basic question could still be
unclear fifty years after passage of the
Lanham Act.
Christine Haight Farley, The Lost Unfair Competition
Law, 110 Trademark Rep. 739, 743 (2020) (emphasis
added). And another leading intellectual property
scholar expressed concern that the Fourth Circuit’s
2016 opinion “deepened the split that existed in the
circuits and added more confusion to a critically
important question of trademark law in a global
marketplace.” Connie Davis Powell Nichols, Article
6bis of the Paris Convention for Well-Known Marks:
Does It Require Use or a Likelihood of Consumer
Confusion for Protection? Did Belmora LLC v. Bayer
Consumer Care AG. Resolve This Question?, 30 Ind.
Int’l & Comp. L. Rev. 235, 248 (2020) (emphasis
added).
This Court’s 2014 Lexmark opinion addressed “a
straightforward question of statutory interpretation:
Does the cause of action in [§ 43(a)] extend to plaintiffs
like Static Control?” 572 U.S. at 129. But unlike
Bayer, Static Control was not the owner of a foreign
trademark seeking to pursue § 43(a) unfair
22
competition claims (or § 14(3) trademark cancellation
claims) against the owner of a USPTO-registered
trademark. In fact, Lexmark is not a trademark case
at all. The Court explained in Lexmark “that a
statutory cause of action extends only to plaintiffs
whose interests fall within the zone of interests
protected by the law invoked,” id. at 129 (internal
quotation marks omitted), and that “a statutory cause
of action is limited to plaintiffs whose injuries are
proximately caused by violations of the statute.” Id.
at 132. Lexmark makes clear that a § 43(a) plaintiff
must fall within that provision’s zone of interests, id.
at 129-32, but does not address whether, in light of
U.S. trademark law’s territoriality principle, that
zone of interests extends to owners of foreign
trademarks. Four circuits, both before and after
Lexmark, have considered this question and/or the
parallel zone-of-interests question under § 14(3).
These four circuits have adopted three different and
conflicting approaches to the issue of foreign
trademark owners’ “standing,” i.e., eligibility, to
pursue § 43(a) actions.
● In Person’s Co., Ltd. v. Christman, 900 F.2d 1565
(Fed. Cir. 1990), the Federal Circuit affirmed the
TTAB’s dismissal of a petition filed by a Japanese
company (Person’s) to cancel a U.S. trademark
registration for use of the Person’s logo on a line of
sportswear. Christman, an American entrepreneur,
obtained a trademark registration for the Person’s
logo, and began using it on clothing sold by his
company (Team Concepts), after seeing it on apparel
that Person’s sold in Japan. After Person’s decided to
23
expand into the United States, it filed a petition with
the TTAB to cancel Christman’s trademark
registration. See id. at 1566-67.
“All the sportswear marketed by Team Concepts
bore either the mark ‘PERSON’S’ or a copy of
[Person’s] globe logo; many of the clothing styles were
apparently copied directly from [Person’s] designs.”
Id. at 1567. Nonetheless, explaining that “the concept
of territoriality is basic to trademark law,” id. at 156869, the Federal Circuit agreed with the TTAB that
Person’s could not “rel[y] on its use of the mark in
Japan in an attempt to support its claim for priority
in the United States.” Id. at 1568. The court of
appeals explained that “[s]uch foreign use has no
effect on U.S. commerce and cannot form the basis for
a holding that [Person’s] has priority here.” Id.
In Person’s “Christman was the first to use the
mark in United States commerce and the first to
obtain a federal registration.” Id. at 1569. Here, the
facts supporting the territoriality principle are even
more compelling since unlike Person’s, which sought a
U.S. trademark registration, Bayer represented to the
court of appeals that it has no intention of using its
FLANAX mark in the United States. Similarly, Bayer
is different from the foreign plaintiff in Australian
Therapeutic Supplies Pty. Ltd. v. Naked TM, LLC, 965
F.3d 1370, 1374, 1375 (Fed. Cir. 2020), which was able
“to demonstrate a real interest” in a § 14(3)
cancellation proceeding based on likelihood of
confusion, and a “reasonable belief of damage,”
because unlike Bayer, it had advertised and sold a
product bearing its unregistered trademark in the
24
United States and had submitted a USPTO
trademark registration application that was refused.
The Federal Circuit in Person’s also rejected that
company’s contention that Christman had adopted
the logo in bad faith, explaining that “adoption of the
mark occurred at a time when [Person’s] had not yet
entered U.S. commerce.” Id. at 1570. The court
indicated that “Christman’s conduct in appropriating
and using [Person’s] mark in a market where he
believed the Japanese manufacturer did not compete
can hardly be considered unscrupulous commercial
conduct.” Id.
● Like the Federal Circuit in Person’s, the Ninth
Circuit in Grupo Gigante S.A. de C.V. v. Dallo & Co.,
391 F.3d 1088 (9th Cir. 2004), recognized that § 43(a)
unfair competition claims brought by a foreign
trademark owner “implicate [a] well-established
principle of trademark law, the ‘territoriality
principle.’” Id. at 1093. Specifically, “[e]arlier use in
another country usually just does not count.” Id.
(citing Person’s, 900 F.2d at 1569-70). But the Ninth
Circuit unequivocally held in Grupo Gigante that
“there is a famous marks exception to the territoriality
principle.” Id. at 1094. Acknowledging that “[t]here
is no circuit-court authority — from this or any other
circuit — applying a famous mark exception to the
territoriality principle,” the court nonetheless held
that “when foreign use of a mark achieves a certain
level of fame for that mark within the United States,
the territoriality principle no longer serves to deny
priority to the earlier foreign user.” Id. at 1093; see
also San Miguel Pure Foods Co. v. Ramar Int’l Corp.,
25
No 13-55537, slip op. at 6 (9th Cir. Aug. 27, 2015)
(unpublished) (“the Ninth Circuit recognizes the
‘famous-mark’ exception”) (citing Grupo Gigante).
The Mexican corporate plaintiff, Grupo Gigante,
operated a chain of “Gigante” grocery stores in Mexico,
and had obtained a Mexican trademark registration
for the GIGANTE name. After the U.S. defendant
opened two San Diego grocery stores using the name
“Gigante Market,” Grupo Gigante opened three Los
Angeles stores under the “Gigante” name. Neither
party held a U.S. trademark registration for
GIGANTE. See id. at 1091-92. The parties filed
§ 43(a) unfair competition claims against each other.
See id. at 1092 n.3 & 4.
The Ninth Circuit asserted, as a matter of public
policy, that “[w]hile the territoriality principle is a
long-standing and important doctrine within
trademark law. . . [a]n absolute territoriality rule
without a famous-mark exception would promote
consumer confusion and fraud. . . . There can be no
justification for using trademark law to fool
immigrants into thinking that they are buying from
the store they liked back home.” Id. at 1094. The
court of appeals remanded the case for a
determination regarding whether its newly adopted
famous-mark exception applied under the facts of the
case. Id. at 1098-99.
The Second Circuit in ITC Ltd. v. Punchgini,
Inc., 482 F.3d 135 (2d Cir. 2007), “considered the
Ninth Circuit’s opinion in Grupo Gigante and
expressly rejected the rationale of the court,”
explaining that the “Ninth Circuit based its decision
●
26
on policy and not on a federal law.” Nichols, supra, at
246 (emphasis added).
Analogous to Gigante,
Punchgini involved, inter alia, § 43(a) unfair
competition claims brought by the foreign owner of a
well-known, international chain of “Bukhara”
restaurants against the owners of two New York
restaurants named “Bukhara Grill.” The court noted
that “[q]uite apart from the obvious similarity in
name, defendants’ restaurants mimic the ITC
Bukharas’ logos, decor, staff uniforms, wood-slab
menus, and red-checkered customer bibs.” Punchini,
482 F.3d at 144.
The Second Circuit held that despite certain nonself-executing multinational treaties that recognize a
“famous marks” exception to trademark territoriality
(e.g., Article 6bis of the Paris Convention for the
Protection of Industrial Property), “no famous marks
rights are independently afforded by the Lanham
Act.” Punchgini, 482 F.3d at 163. “[M]indful that
Congress has not hesitated to amend the Lanham Act
to effect its intent with respect to trademark
protection,” the court of appeals explained that “the
absence of any statutory provision expressly
incorporating the famous marks doctrine . . . is all the
more significant.” Id. at 164. The court also observed
that Grupo Gigante “did not reference . . . the language
of the Lanham Act,” but instead, “it appears that the
Ninth Circuit recognized the famous marks doctrine
as a matter of sound policy.” Id. at 160. Unlike the
Ninth Circuit, however, the Second Circuit concluded
that “although a persuasive policy argument can be
advanced in support of the famous marks doctrine,”
27
the court cannot “grant judicial recognition to the
famous marks doctrine simply as a matter of sound
policy.” Id. at 165. As the Court recently explained
in Romag Fasteners, Inc. v. Fossil, Inc., 140 S. Ct.
1492, 1497 (2020), a case involving interpretation of
§ 43(a), “the place for reconciling competing and
incommensurable policy goals . . . is before policy
makers.”
● The Fourth Circuit’s 2016 opinion in the
present litigation purported to “consider whether the
Lanham Act permits the owner of a foreign trademark
and its sister company to pursue false association,
false advertising, and trademark cancellation claims
against the owner of the same mark in the United
States.” App. 30a (emphasis added). Yet, the court of
appeals “sidestepped altogether the territoriality
doctrine that concerned the other three circuits’
rulings,” and “on its face is a complete break from the
tenets of territoriality.” Nichols, supra, at 248, 249.
“[W]hat is especially notable about Belmora is its
failure to recognize the implications of its decision for
the territoriality of trademark rights.” McKenna &
Niemann, supra, at 122. “In fact [the Fourth Circuit’s
opinion] did not even once mention the territoriality
doctrine . . . . the Fourth Circuit failed to acknowledge
that its ruling challenged fundamental principles of
trademark law.”
Christine Haight Farley, No
Trademark, No Problem, 23 B.U. J. Sci. & Tech. L.
304, 312-13 (2017). Nor did the Fourth Circuit
“discuss, distinguish, or cite to either Grupo Gigante,
Punchgini, or Person’s.” Id. at 312; see also McCarthy,
28
supra, at § 29:1 n. 14.50 (“The court made no mention
of the territoriality principle.”).
Instead, expressly disclaiming at least one of its
own prior precedents, App. 47a, the Fourth Circuit
held that Ҥ 43(a) actions do not require, implicitly or
otherwise, that a plaintiff have first used its own mark
in United States commerce.” Id. 49a. In so doing, the
Fourth Circuit simply assumed that Lexmark’s
analytical framework applies to owners of foreign
trademarks. Id. 44a, 45a. According to the court of
appeals, Bayer satisfies Lexmark’s zone of interest
and proximate cause requirements merely because its
complaint alleges that Belmora “has caused BCC
[Bayer Consumer Care AG] customers to buy the
Belmora FLANAX in the United States instead of
purchasing BCC’s FLANAX in Mexico.” Id. 51a.
The Fourth Circuit’s 2016 opinion, therefore, not
only “made the waters murky,” but also “further
expands the divergent case law” on whether Lanham
Act unfair competition and trademark cancellation
claims can be pursued by owners of foreign
trademarks that are not registered or used in the
United States. Nichols, supra, at 248, 249.
B. The circuits also are divided on what
governs the timeliness of § 43(a) claims
In its second opinion in this litigation, the Fourth
Circuit panel (composed of the same three circuit
judges who issued the 2016 opinion) was called up to
“decide whether to apply a statute of limitations
borrowed from the most analogous state law or
instead some other ‘timeliness rule[] drawn from
29
federal law’ to claims under § 43(a) of the Lanham Act,
which does not expressly contain a limitations period
for those claims.” App. 13a (quoting DelCostello v.
Int’l Brotherhood of Teamsters, 462 U.S. 151, 162
(1983)). Reversing the district court—which held that
under the most analogous California law, Bayer
“misse[d] the statute of limitations by almost a
decade,” App. 72a-73a—the panel held in its 2021
opinion that § 43(a) is a “federal law for which a state
statute of limitations would be an unsatisfactory
vehicle for enforcement.”
App. 14a.
Instead,
according to the court of appeals, because Ҥ 43(a)
claims for damages are ‘subject to the principles of
equity,’” App. 15a (quoting 15 U.S.C. § 1117(a)),
“laches is the appropriate defense to § 43(a) claims.”
Id. (The ruling is limited to § 43(a) because § 14(3)
trademark cancellation petitions can be filed “[a]t any
time.” 15 U.S.C. § 1064(3).)
The court’s conclusion that laches, not the most
analogous state statute of limitations, governs the
timeliness of § 43(a) claims exacerbates the already
mature split of authority on this issue. Coupled with
the same panel’s 2016 opinion discarding the principle
of trademark territoriality, the 2021 opinion affords
foreign owners of foreign trademarks virtually free
rein to use § 43(a) as a lethal weapon against U.S.
competitors.
In DelCostello, this Court explained that
[a]s is often the case in federal civil law,
there is no federal statute of limitations
expressly applicable to [a] suit. In such
situations we do not ordinarily assume
30
that Congress intended that there be no
time limit on actions at all; rather, our
task is to “borrow” the most suitable
statute or other rule of timeliness from
some other source. We have generally
concluded that Congress intended that the
courts apply the most closely analogous
statute of limitations under state law.
462 U.S. at 158 (emphasis added).
“In some
circumstances, however, state statutes of limitations
can be unsatisfactory vehicles for the enforcement of
federal law,” and the Court has “instead used
timeliness rules drawn from federal law — either
express limitations periods drawn from related
federal statutes, or such alternatives as laches.” Id.
at 161-62.
At least two circuits have applied analogous statelaw statutes of limitations to determine the timeliness
of § 43(a) claims. For example, in Island Insteel Sys.,
Inc. v. Waters, 296 F.3d 200, 206 (3rd Cir. 2002), a
§ 43(a) trademark infringement case, the Third
Circuit—applying the Virgin Islands statute of
limitations governing deceptive trade practices—
indicated that “[b]ecause the Lanham Act does not
contain an express statute of limitations, we follow the
traditional practice of borrowing the most analogous
statute of limitations from state law.” See also Beauty
Time, Inc. v. VU Skin Sys., Inc., 118 F.3d 140, 143 (3rd
Cir. 1997) (a “claim for fraud under the Lanham Act
conforms to [the] general rule” that “when a federal
statute provides no limitations for suits, the court
31
must look to the state statutes of limitations for
analogous types of actions”).
Similarly, in Karl Storz Endoscopy-America, Inc. v.
Surgical Techs., Inc., 285 F.3d 848, 857 (9th Cir.
2002), where the plaintiff alleged § 43(a) trademark
infringement and other Lanham Act claims, the Ninth
Circuit—citing the California statute of limitations
governing fraudulent business practices—indicated
that the plaintiff’s “Lanham Act claims are subject to
a three-year statute of limitations.” See also Gen.
Bedding Corp. v. Echevarria, 947 F.2d 1395, 1397 n.2
(9th Cir. 1991) (noting that “federal claims, such as
plaintiff’s Lanham Act claim . . . borrow state statutes
of limitations”).
Other circuits, however, apply laches, sometimes
informed by an analogous state statute of limitations,
to determine the timeliness of a § 43(a) claim. For
example, in Kehoe Component Sales, Inc. v. Best
Lighting Prods., Inc., 796 F.3d 576, 584 (6th Cir.
2015), the Sixth Circuit indicated that “determining
whether a Lanham Act claim is time-barred depends
upon the defendant’s ability to show that the claim is
barred by laches.” See also Tandy Corp. v. Malone &
Hyde, Inc., 769 F.2d 362, 365 (6th Cir. 1985) (“Under
equitable principles the statute of limitations
applicable to analogous actions at law is used to create
a ‘presumption of laches.’”). The Eleventh Circuit “in
trademark cases . . . has followed the Sixth Circuit,
which applies the period for analogous state law
claims as the touchstone for laches.” Kason Indus.,
Inc. v. Component Hardware Grp., Inc., 120 F.3d 1199,
1203 (11th Cir. 1997); see also Hot Wax, Inc. v. Turtle
32
Wax, Inc., 191 F.3d 813, 822-23 (7th Cir. 1999)
(“conclud[ing] that whether a Lanham Act claim has
been brought within the analogous state statute of
limitations is not the sole indicator of whether laches
may be applied in a particular case”).
In its 2021 opinion, the Fourth Circuit held that
the district court, which looked to the most analogous
(California) state statutes of limitations, applied “an
incorrect legal standard,” but that “state law will
continue to play an important role” since “[l]aches is
presumed to bar § 43(a) claims filed outside the
analogous limitations period.” App. 16a, 17a. In
reaching this conclusion, the court of appeals
acknowledged conflicting precedent within the Fourth
Circuit court of appeals on the standard governing
timeliness. See App. 15a n.7.
II. The Questions Presented Are Exceptionally
Important
The key, indisputable fact in this litigation—the
fact that makes the territoriality issue in this case so
important to trademark owners both in the United
States and abroad—is that Bayer never has registered
or used its Mexican FLANAX mark in the United
States.
In dispensing with use of a mark in the
United States as a “condition precedent” to
a Section 43(a) claim, Belmora is a
watershed in the development of unfair
competition law. . . .
Belmora’s
decoupling
of
unfair
competition law from trademark law could
33
enlarge the reach of unfair competition law
exponentially . . . .
Farley, The Lost Unfair Competition Law, supra, at
797 (emphasis added). “[T]he major impact of the
Fourth Circuit’s decision in Belmora is that the
principle of territoriality—the notion that trademark
rights are national in character—has essentially been
abrogated in unfair competition cases.” Farley, No
Trademark, No Problem, supra¸ at 317. As a result,
the Fourth Circuit’s “decision enables foreign parties,
which neither have a U.S. trademark nor use the
mark in the U.S., to strip U.S. trademark owners of his
or her rights” (emphasis added). Id. at 307. As the
district court explained prior to the Fourth Circuit’s
2016 opinion, “cases make it is clear to the Court that
although Section 43(a)(1)(A), by its terms, does not
require use of the mark, courts have consistently
required a plaintiff to use the mark in United States
commerce in order to state a claim under that statute.”
App. 136a (emphasis added).
The Fourth Circuit’s radical departure from the
principle of trademark territoriality has sparked
significant debate among intellectual property
scholars. See, e.g., McKenna & Niemann, supra, at
119 (“Belmora has important implications for the
territoriality of trademark rights.”); Nichols, supra, at
249 (“[T]here is light at the end of this diverging case
law tunnel. At least the Belmora court looked at the
plain language of the Lanham Act and abandoned the
territoriality principle, which enabled the court to
enforce a foreign trademark owner’s trademark.”);
Barton Beebe, What Trademark Law Is Learning from
34
the Right of Publicity, 42 Colum. J.L. & Arts 389, 394
(2019) (Belmora “suggests that the language of section
43(a) refers to any entity in the world, regardless of
whether it is actually using a trademark within the
territorial borders of the United States”); Mark P.
McKenna, Property and Equity in Trademark Law, 23
Marq. Intell. Prop. L. Rev. 117, 135 (2019) (“[W]hat
Bayer wanted was the best of both the new and old
legal orders. It wanted the benefits of treating § 43(a)
as a version of old unfair competition, so that it could
bring a claim when the alleged confusion was caused
by something other than use of Bayer’s trademark
(since it did not own the trademark). At the same
time, Bayer did not want the limited remedies offered
by unfair competition.”)
Law review editors also have found the Fourth
Circuit’s 2016 opinion to be a worthy subject for
scholarly research and commentary. See, e.g., Deepa
Singh, Comment, Article 6bis of the Paris Convention:
How the United States Court of Appeals for the Second
Circuit is Violating International Law, 35 Am. U. Int’l
L. Rev. 577, 596 (2020) (“Essentially, the Ninth
Circuit [in Grupo Gigante] and TTAB [in Belmora]
allowed foreign trademark owners, who have never
used their marks in commerce in the United States, to
prohibit registration and use of U.S. trademark
owners who have used the mark first and have
followed all other requirements necessary for
registration with the USPTO.”); Su Li, Note, Belmora
LLC v. Bayer Consumer Care AG: Unfair Competition
as an Alternative Approach to Penetrate the Territorial
Principle in U.S. Trademark Law, 31 Berkeley Tech.
35
L.J. 1145, 1171 (2019) (“Empirical data in trademark
law litigation and registration shows that refraining
from resolving the circuit split may lead to forum
shopping and also increase the confusion of the large
volume of foreign trademark owners who hope to get
protected under the U.S. Lanham Act.”); Gwen Wei,
Note, Taking Care of Article 6bisness: How Belmora
LLC v. Bayer Consumer Care AG Made the WellKnown Mark Doctrine Inevitable in the U.S., 12 Wash.
J. L. Tech. & Arts 501, 524 (2017) (“Wholly avoiding
the territoriality principle in the Belmora tradition is
impractical.”); Wee Jin Yeo, Belmora LLC v. Bayer
Consumer Care AG—The Well-Known Marks Doctrine
Reconsidered, 73 Wash. & Lee L. Rev. Online 188
(2016) (the Belmora opinion “provides useful insight
on how the circuit split should be resolved, but
cautions future courts not to mechanically apply the
Fourth Circuit’s decision”).
Many online commentaries also reflect the
practical significance of the Fourth Circuit’s 2016
opinion. See, e.g., Jones Day, Standing to Enforce
Foreign Trademark Rights After Belmora v. Bayer
Certiorari Denial, Commentaries (Mar. 2017) (“[A]
trademark owner without use of its mark in U.S.
commerce should look to courts in the Fourth Circuit
to file Lanham Act claims”). 3
Professor Christine Farley, Faculty Director of the
American University Washington College of Law’s
Program on Information Justice and Intellectual
Property, has explained why the Fourth Circuit’s
3 Available at https://tinyurl.com/bpzahkf7.
36
literally global reading of the Lanham Act’s zone of
interests not only has “surprised the legal community”
and “and received considerable attention,” but also, as
a practical matter, “broadens the reach of Belmora
. . . to any party without a mark.” Farley, No
Trademark, No Problem, supra, at 304, 317.
[Under] Section 21(b) of the Lanham Act
[15 U.S.C. § 1071(b)], a litigant may forgo
an appeal to the Federal Circuit and opt
instead to appeal a TTAB decision via a
civil action. Such a suit, according to the
act, shall be brought in the Eastern
District of Virginia.
Significantly,
Belmora is now controlling precedent in
the Eastern District of Virginia. As a
result, foreign mark owners like Bayer,
who lack U.S. trademarks would be wise to
take the option of bringing their appeal to
the Eastern District of Virginia. This
strategy has the dual benefit of coming
within the controlling precedent of
Belmora, and avoiding the Federal Circuit
and its precedent of Person’s. . . .
[T]he Belmora precedent is not just
binding in the Fourth Circuit . . . any party
that can bring a Section 14(3) cancellation
petition in the TTAB can then bring an
appeal in the Eastern District Court of
Virginia and in this way bypass an initial
action in a district court outside of the
Fourth Circuit. . . .
37
This combination enables a party to bring
an unfair competition case styled as a
Section 14(3) misrepresentation of source
cancellation proceeding in the TTAB, then
move the case to the Fourth Circuit.
Id. at 317.
Increasing globalization of commerce, including
foreign and multinational corporations’ aggressive
marketing of American-branded products in the
United States (e.g., Aleve), makes the need for this
Court to address the reach of Lanham Act §§ 43(a) &
14(3) more compelling than ever. For example, the
Chinese Government, as a matter of foreign policy, is
engaged in destabilizing American businesses to
achieve global economic dominance. Were Chinese
state-owned companies to exploit the Lanham Act in
the manner now allowed by the Fourth Circuit, the
economic impact on American businesses and
consumers could be catastrophic.
The Court also should address the standard for
judging the timeliness of § 43(a) unfair competition
claims. As the Fourth Circuit indicated in its 2021
opinion, laches is a flexible standard that affords
district courts broad leeway when claims, as here, are
filed well beyond the time allotted by analogous state
statutes of limitations. See App. 14a-15a. Requiring
Lanham Act claimants to adhere to such limitations
periods would establish a uniform and predicable
standard for the timely filing of § 43(a)) claims. The
need for such a standard is particularly evident when
the Fourth Circuit’s expansive reading of the zone of
interests encompassed by § 43(a) is considered.
38
This appeal is an excellent vehicle for considering
the two fundamental trademark law questions
presented by this petition. There is no reason to delay
this Court’s review in order to await a possible third
Fourth Circuit appeal under a timeliness standard
that at least two circuits view as incorrect, and in
litigation which owners of foreign trademarks such as
Bayer would be unable to pursue in at least two other
circuits. The Fourth Circuit’s published 2016 opinion
extending §§ 43(a) and 14(3) to owners of foreign
trademarks that have not registered or used those
marks in the United States is a final ruling, subject
only to this Court’s review. Even if Belmora were to
persuade the district court that laches bars Bayer’s
§ 43(a) claims, cancellation of Belmora’s FLANAX
trademark will remain in place unless this Court rules
that
the
trademark
territoriality
principle
circumscribes the Lanham Act’s zone of interests by
precluding foreign trademark owners such as Bayer
Consumer Care AG from petitioning under § 14(3) for
cancellation of U.S. trademarks.
Meanwhile, other courts are citing the Fourth
Circuit’s Belmora rulings. See, e.g., Palleteria La
Michoacana, Inc. v. Productos Lacteos Tacumbo S.A.
de C.V., No. 17-1075, slip op. at 9 (D.C. Cir. Aug. 10,
2018), (discussing “Belmora’s reading of Section
43(a)(1)(A)” in litigation between Mexican and
American companies selling similar products in the
United States); see also Industria de Alimentos Zenu,
S.A.S. v. Latinfood U.S. Corp., 2017 WL 6940696, at
*13 (D.N.J. Dec. 29, 2017) (finding the Fourth
Circuit’s 2016 opinion “persuasive,” and declining to
39
dismiss a Colombian company’s § 43(a) claims
alleging that the U.S. defendant was competing
unfairly by registering and using the same company
name); Coca-Cola Co. v. Meenaxi Ent., Inc., Canc. Nos.
92063353 & 92064398, slip op. at 51 (TTAB June
28, 2021) (citing Belmora). As to laches, see, e.g.,
WorkingFilms, Inc. v. Working Narratives, Inc., 2021
WL 1196189, at *4 (E.D.N.C. Mar. 29, 2021) (citing
Belmora’s holding that § 43(a) violations are
“subject to the doctrine[] of laches”).
This protracted litigation, which began in 2007
with the TTAB proceeding, has deepened inter-circuit
divisions, engendered scholarly debate, and created
commercial uncertainties. Further, were Bayer
ultimately to succeed, the nation’s large and
expanding Hispanic population would be deprived of
an FDA-approved, bilingually packaged and labeled
alternative to higher-priced Aleve.
The Court has not been reluctant to revisit
Lanham Act § 43(a) to provide trademark owners with
much-needed clarification or guidance. See, e.g.,
Lexmark; Romag Fasteners; POM Wonderful; Two
Pesos; Dastar. This is such a case. The Court should
grant review and address both important questions
presented.
40
CONCLUSION
The petition for a writ of certiorari should be
granted.
Respectfully submitted,
LAWRENCE S. EBNER
Counsel of Record
CAPITAL APPELLATE ADVOCACY PLLC
1701 Pennsylvania Ave., NW, Suite 200
Washington, D.C. 20006
(202) 729-6337
lawrence.ebner@capitalappellate.com
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.