Summary
The Second Circuit affirmed summary judgment against ITC Limited and ITC Hotels Limited on their trademark infringement and federal unfair competition claims, holding that ITC had abandoned the Bukhara mark for restaurant services in the United States and that Congress had not incorporated the famous-marks doctrine into federal trademark law. The court also affirmed dismissal of the false advertising claim for lack of standing. It certified questions concerning the famous-marks doctrine under New York common law to the New York Court of Appeals.
Topics
Practice areas
Questions Presented
- Whether ITC abandoned its registered Bukhara mark for restaurant services in the United States.
- What evidentiary showing is required to rebut the Lanham Act's presumption of abandonment after three consecutive years of nonuse.
- Whether the famous-marks doctrine supplies a federal priority right under the Lanham Act for a foreign mark not used in the United States.
- Whether New York common law recognizes the famous-marks doctrine and, if so, what level of fame is required.
- Whether ITC had standing to assert a false-advertising claim under section 43(a)(1)(B) of the Lanham Act.
Holdings
- ITC abandoned its Bukhara mark for restaurant services in the United States because it did not use the mark for more than three consecutive years and failed to produce evidence from which a reasonable jury could infer that, during the nonuse period, it intended to resume use in the reasonably foreseeable future.
- To rebut the presumption of abandonment at summary judgment, the mark owner need only produce evidence that, viewed in the light most favorable to the owner, could permit a reasonable jury to find that the owner had not abandoned the mark; hard evidence of concrete plans is sufficient but not categorically required.
- The famous-marks doctrine does not provide a federal priority right under the Lanham Act for a foreign mark not used in the United States, because Congress has not incorporated the doctrine's substantive protections into federal trademark law and the court will not create the exception solely as a matter of policy.
- The court reserved decision on the state-law unfair-competition claim and certified to the New York Court of Appeals whether New York common law permits an owner of a famous mark or trade dress to assert rights based on prior foreign use and, if so, how famous the mark must be.
- ITC lacked standing to assert a false-advertising claim under section 43(a)(1)(B) because it failed to show a reasonable basis for believing that defendants' restaurant advertising was likely to injure ITC's packaged-food business, foreign restaurants, or speculative future United States restaurant plans.
Key quotations
“The significance of a presumption of abandonment is to shift the burden of production to the mark owner to come forward with evidence indicating that, despite three years of non-use, it intended to resume use of the mark within a reasonably foreseeable time.” (482 F.3d at 148)
“Hard evidence of concrete plans to resume use of the mark would certainly carry this burden. But we do not foreclose the possibility that other circumstances, viewed in the light most favorable to the non-movant, might also support the necessary jury inference of intent.” (482 F.3d at 150)
“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.” (482 F.3d at 156)
“Before we construe the Lanham Act to include such a significant departure from the principle of territoriality, we will wait for Congress to express its intent more clearly.” (482 F.3d at 164)
“ITC's reasoning depends on multiple levels of speculation, and its conclusion is too attenuated from the patronage profile evidence to demonstrate a real "likelihood of injury and causation" sufficient to confer standing to sue for false advertising.” (482 F.3d at 171)
Factual background
ITC owned and operated the Bukhara restaurant in New Delhi and had previously operated or franchised Bukhara restaurants in the United States. Its Manhattan restaurant closed in 1991, and its Chicago franchise ended in 1997; ITC thereafter did not own, operate, or license a United States restaurant using the Bukhara mark. Defendants later opened Bukhara Grill restaurants in New York using a similar name and allegedly similar logos, decor, uniforms, menus, and bibs. ITC sued after defendants refused to stop using the mark, while ITC continued operating Bukhara restaurants abroad and later developed packaged Dal Bukhara food products.
Procedural history
ITC sued defendants under the Lanham Act and New York common law based on defendants' use of the Bukhara name and related restaurant trade dress. The district court granted defendants summary judgment, holding that ITC had abandoned its United States restaurant-service mark, rejecting the federal famous-marks theory, and finding no standing for the false-advertising claim. On appeal, the Second Circuit affirmed those rulings in part and certified two unresolved New York-law questions concerning the famous-marks doctrine.
Remand instructions
No conventional remand was ordered. The court reserved decision on the New York common-law unfair-competition claim pending the New York Court of Appeals' response to certified questions concerning recognition and scope of the famous-marks doctrine.