Trademark rights are territorial in nature. The general rule is that a brand owner must use its mark in the United States to obtain rights here, and the use of a mark abroad typically does not result in U.S. rights.

But what happens when a foreign brand is well known in the United States but not used here, and an opportunistic company registers an identical mark to trade on the reputation of the foreign brand in this country? That was the question in Bayer Consumer Care A.G. v. Belmora (or “Bayer II”) before the Trademark Trial and Appeal Board in April at the U.S. Patent and Trademark Office. It was a question the board called a “matter of first impression.” In that case, the board held that seldom-used Section 14(3) of the Lanham Act, the federal trademark statute, gives an owner of a foreign brand the right to cancel a U.S. trademark registration if the U.S. registrant is using its mark to misrepresent the source of its product. To the casual observer, this may seem like an obvious ruling. Of course someone who is trading on the renown of a foreign brand to trick U.S. consumers should not be entitled to the government imprimatur of a trademark registration. But the nearly seven-year history of this cancellation proceeding and the multiple rounds of motions to dismiss demonstrate the groundbreaking nature of this decision and offer insights for practitioners.

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