Prologue — SKF USA INC. v. International Trade Commission

nd O5 1236 MAR 23 9006

QFFICE OF Trik: Gucnix

IN THE

Supreme Court of the United States

SKF USA Inc.,

Petitioner,

Vv.

INTERNATIONAL TRADE COMMISSION, BEARINGS LIMITED,

and McGuire BEARING COMPANY,

Respondents.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

Unrrep STates Court OF APPEALS

FOR THE FEDERAL CIRCUIT

PETITION FOR A WRIT OF CERTIORARI

APPENDIX

Volume I of II (pp. 1a-120a)

BENNETT EVAN COOPER Herpert C. SHELLEY

STEPTOF & JOHNSON LLP Counsel of Record

Collier Center Auice A. KIPEL

201 East Washington Street STEPTOE & JOHNSON LLP

Suite 1600 © 1330 Connecticut Ave., N.W.

Phoenix, AZ 85004-2382 Washington, D.C. 20036

(602) 257-5200 (202) 429-8146

Counsel for Petitioner

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QUESTION PRESENTED

Does the Lanham Act prohibit, as trademark infringement,

the sale of imported gray market goods that are materially

different from al] but a very small percentage of the

trademark owner’s legitimate goods authorized for sale under

the mark in the United States?

i

RULE 29.6 STATEMENT

Petitioner SKF USA Inc., a United States corporation, is a

wholly owned subsidiary of AB SKF, a publicly owned

corporation trading on the Swedish stock exchange.

Respondents are the United States International Trade

Commission, Bearings Limited, and McGuire Bearing

Company.

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TABLE OF CONTENTS

Page

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STATUTORY PROVISIONS INVOLVED ............ccesseeseeeees 2

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C. PROGOCGIRRS TCI W on.ccsisecscensienssccerss OD AOT OPER OPA 7

1. Administrative Law Judge..............ccccccceeeees 7

2. International Trade Commission ..................... 7

3: COE OE ARON icissciccicccive ictaatass coksced 8

REASONS FOR GRANTING THE PETITION.................... 9

I. THE FEDERAL CIRCUIT’S “MATERIAL

DIFFERENCES” STANDARD CONFLICTS WITH

THE APPROACHES OF OTHER CIRCUITS.............. 10

Il. THE CIRCUIT CONFLICT UNDERMINES

TRADEMARK OWNERS’ AND THE PUBLIC’S

PRINCIPAL PROTECTION AGAINST GRAY

MARKET INFRINGEMENT. ..............ccccccoscessscesesnscesees 14

A. The Federal Circuit’s Extreme Standard Ignores the

Reality of Consumer Markets and Trademark

Law’s Focus on Protecting the Expectations of

PE NE ie.isiisiceicicctincactisitcindecntenens 14

iV

B. The Federal Circuit’s Standard Undermines a

Critical National Remedy Against Infringement by

Calis TE SIE: icearsiitnstdicncrin rain 17

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Vv

TABLE OF AUTHORITIES

Page

CASES

Ahava (USA), Inc. v. J. W.G., Lid., 250 F. Supp. 2d

FOG (SDNY. 2003) .oessessssssssscrccsssecnsnsrsocnsvesvensoneion 10

Am. Circuit Breaker Corp. v. Oregon Breakers Inc.,

Be Fk 20 FOE Shs ROAD ia sscnatensskrhcascscisascaseisoane 11

Davidoff & CIE, SA v. PLD Int'l Corp., 263 F.3d

Ee OO SIE BEE Bis diisticdanieesiicrctidinesaubasens 1]

El Greco Leather Prod. Co. v. Shoe

World, Inc., 806 F.2d 392 (2d Cir. 1986).......... 11,15

Fisher Stoves, Inc. v. All Nighter Stove Works, Inc.,

Se ae Fe CLUE tie FI vcsncscccnccpicinsursscoaneensisnne 16

Gamut Trading Co. v. United States Int'l Trade

Comm’n, 200 F.3d 775 (Fed. Cir. 1999)... 10

Iberia Foods Corp. v. Rolando Romeo, 150 F.3d

BE CE aE ER esis abdiskecsgencsierpanticinbeasevene 11,12

Manhattan Indus. v. Sweater Bee by Banff, Ltd.,

ak FO ck Ak Cee Gals LD arsciivbvcassdenicceesvnrserinricns 16

Martin's Herend Imports, Inc. v. Diamond & Gem

Trading USA, Co., 112 F.3d 1296

POA oN URN sascha coancs eacende aca taicaannavabdansiasni 10, 11

Monsanto Co. v. Haskel Trading, Inc., 13 F. Supp. 2d

DTN. Fs UIE ik sciacds acting aandiin anda 10

Original Appalachian Artworks, Inc. v. Granada Elec., Inc.,

OOF kt O6 CAN GE: BORD aicctkneactnaicsndccene 10

vi

Osawa & Co. v. B&H Photo, 589 F. Supp. 1163

SAE | Rn een ee ECE OED 18

Philip Morris, Inc. v. Allen Distribs., Inc., 48 F. Supp. 2d

Re SU SII weichcstchsiinactssceh mncenasabiecaiameastis 15,17

R.J. Reynolds Tobacco Co. v. Premium Tobacco

Stores Inc., 57 U.S.P.Q.2d (BNA) 1253

Aas ME POs Kala GME akiciiditssphchanaksadansvninnsaveiicens 14

Shell Oil Co. v. Commercial Petroleum, Inc.,

928 F.2d 104 (4th Cir. 1991) vecceccccccessecscsseeceeoee 11,12

SKF USA Inc. v. Int’l Trade Comm'n,

423 F.3d 1307 (Fed. Cir. 2005) .................00 FE, 12, 33

Societe Des Produits Nestle, S.A. v. Casa

Helvetia, Inc., 982 F.2d 633

ERIE SI, SP tiiscpectntinccanacionen 10, 11, 12, 16

Warner-Lambert Co. v. Northside

Dev. Co., 86 F.3d 3 (2d Cir. 1996)... 10, 11, 13

STATUTES

15 U.S.C. § 1114(1)(a)ssssssssecee oes ea aan 2

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Vii

ADMINISTRATIVE PROCEEDINGS

Certain Bearings and Packaging Thereof, Inv. No. 337-TA-

469, 2004 ITC LEXIS 473 (Int! Trade Comm’n June

FE STD iisiecetevcbiah ccitasieeanbadiniaemuabiisiiie 1,4,7

Certain Bearings and Packaging Thereof, Inv. No. 337-TA-

469, 2003 ITC LEXIS 321 (ALJ Initial Determination

FO, FG, FOO) siscscinitermatiiansiniacantnamiaanes SE

Certain Bearings and Packaging Thereof, Order No. 140:

Additional Findings of Fact Pursuant to theComm’n

Remand Order, Inv. No. 337-TA-469, 2003 ITC

LAID 198 TALS TRG. BU, BROS) scisscccsisenteitteaiertieone ]

LEGISLATIVE MATERIAL

S. Rep. No. 19-1333 (1946), reprinted in 1946 U.S.

COP CORR: SAV. BEG siscimncsctnisinennmnan 16

MISCELLANEOUS

Jerome Gilson, Trademark Protection and Practice

ST AES 1 COD + shtcisss sshsrilatacmtipionepmaiaoneial 9, 16

J. Thomas McCarthy, McCarthy on Trademarks and

Unfair Competition (4th ed. 2005) ...........0.. 2, 16,17

Frank V. Cespedes, et al., Gray Markets: Causes and Cures,

66 HARVARD BUS. REV. 75

(FORT AS: ID inn accceasinnmeeaaten 17

KPMG/Anti-Gray Market Alliance, The Grey Market (2003),

available at http://www.kpmg.de/library/pdf/

030211_The_Grey_Market_en.pdf........0.00.. 17

Vill

TABLE OF APPENDICES

Page

Appendix A — Opinion Of The United States Court

Of Appeals For The Federal Circuit Decided

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Appendix B — Opinion Of The United States

International Trade Commission Dated May 24,

sera iehpayasssdeerh sis durisivbissishpsarosuescseoseses 24a

Appendix C — Initial Determination Concerning

Violation Of Section 337 And Recommended

Determination On Issues Concerning Permanent

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Appendix D — Order Of The United States Court Of

Appeals For The Federal Circuit Denying Petition

For Rehearing Dated December 23, ZOOS ....n-serecsersvees 523a

Appendix E — Relevant Statutes ......................csc.eccseeees 525a

PETITION FOR WRIT OF CERTIORARI

SKF USA Inc. (“SKF USA”) respectfully petitions for a

writ of certiorari to review the judgment of the United States

Court of Appeals for the Federal Circuit in this case.

OPINIONS BELOW

The opinion of the court of appeals is reported at 423 F.3d

1307 (Fed. Cir. 2005) (Pet. App. 1a-23a). The order of the

court of appeals denying the petition for rehearing and

rehearing en banc is unreported. 2005 U.S. App. LEXIS

29264 (Fed. Cir. Dec. 23, 2005) (Pet. App. 523a-524a).

The final determination of the United States International

Trade Commission (“ITC”), styled Certain Bearings and

Packaging Thereof, Inv. No. 337-TA-469, is published at

2004 ITC LEXIS 473 (Int! Trade Comm’n June 30, 2004)

(Pet. App. 24a-120a). Notice of the decision was issued by

the ITC on May 12, 2004, and published in the Federal

Register on May 18, 2004 (69 Fed. Reg. 28,155), with the

determination being issued thereafter on May 24, 2004.

The initial determination of the presiding Administrative

Law Judge at the ITC, which issued on April 10, 2003, is

published at 2003 ITC LEXIS 321 (2003) (Pet. App. 121a-

522a), with additional findings of fact pursuant to the ITC’s

remand order, issued on December 30, 2003, published at

2003 ITC LEXIS 794.

The appendices accompanying this petition are public

versions. Confidential versions of the ITC and ALJ

documents are available should the Court so request.

JURISDICTION

The court of appeals denied SKF USA’s petition for

rehearing and rehearing en banc on December 23, 2005 (Pet.

App. 523a-524a). The jurisdiction of this Court is invoked

under 28 U.S.C. § 1254(1) (2000).

2

STATUTORY PROVISIONS INVOLVED

Sections 337(a)({1)(A) and (C) of the Tariff Act of 1930, as

amended, 19 U.S.C. §§ 1337(a)(1)(A) and (C), setting forth

the unfair practices in import trade which are at issue herein

and actionable under Section 337, and Sections 32(1)(a) and

43(a)(1)(A) of the Trademark Act of July 5, 1946, as

amended, (the “Lanham Act”), 15 U.S.C. §§ 1114(1)(a) and

1125(a)(1)(A), declaring as unlawful the unfair trade practices

of infringement of a registered trademark and false

designation of origin, respectively. These statutes are

reproduced at Pet. App. 525a-530a.

STATEMENT

A. Introduction

This petition presents a pressing circuit conflict over the

-legal standard for trademark infringement by “gray market”

goods manufactured abroad and bearing the trademark

owner’s mark but imported for resale in this country without

the trademark owner’s consent. Gray market goods may differ

from authorized goods in both physical characteristics and

nonphysical characteristics, such as accompanying warranties

and post-sale services. There is a great risk that consumers

who see the trademark affixed to gray market goods will be

confused or deceived and will not recognize that the goods

lack the full set of attributes of authorized goods.

Most circuits therefore hold that if there are “material

differences,” whether physical or nonphysical, between the

gray market imports and the trademark owner’s authorized

goods, sale of the gray market goods is “likely to cause

confusion, or to cause mistake, or to deceive” and thereby

infringe the trademark under 15 U.S.C. §§ 1114(1)(a) and

1125(a)(1)(A). See generally J. Thomas McCarthy, McCarthy

on Trademarks and Unfair Competition § 29:51.2 (4th ed.

2005). The Lanham Act protects United States trademark

owners from infringement of their marks by such gray market