Bulletin 3 Association News

California Adopts Model State Trademark Bill

So You Want To Be a Trademark Lawyer?

Roundtable Roundup 5 Features

Declarations of Fame and Notoriety in Mexico

7 Law & Practice

BRITISH VIRGIN ISLANDSNew UK Legislation Affects Some BVI Trademarks

CHINACourt Awards Top Penalties for Willful Infringement Where Damages, Profits Were Not Ascertainable

Infringement Found Where Two Company Names Use Same Three Characters In Different Order

Pub Name with Different Spelling But Same Pronunciation Is Infringing

GERMANYCourt Freezes .eu Domain to Avert Bad Faith Transfer

IRAQBoycott Declaration No Longer Required

LEBANONNinth Edition of the Nice Classification

UNITED STATESCalifornia: Truth in Music Advertising Act

Federal Trade Commission Fines Typosquatter

11 INTA Bulletin Board

The Voice of the International Trademark Association November 15, 2007 Vol. 62, No. 21

IN THIS ISSUEINTA Argues Before U.S. Fourth Circuit in CHEWY VUITON Dilution Case

right, Judge Cacheris granted summary judgment to HDD on all counts. LVM promptly appealed.

INTA’s sole interest in the case is with respect to the court’s analysis of the dilution by blurring claim. In considering that issue, the district court cited a trio of cases from federal courts in New York that involved trademark dilution claims against parodies. Those cases had held that under

the New York State antidilution act, “the use of famous marks in parodies causes no loss of distinc-tiveness, since the success of the use depends upon the continued asso-ciation with the plaintiff.” Applying that principle to this case, the dis-trict court concluded that as a mat-ter of law the CHEWY VUITON mark and trade dress could not blur the distinctiveness of the famous LOUIS VUITTON trademark and the distinctiveness of the famous design of LVM’s handbags.

In INTA’s view, the district court’s analysis was incorrect for two reasons. First, INTA disagrees with the district court’s ruling that a parody is always immune from a finding of dilution. Under the TDRA, parodies may be entitled to a “fair use” defense, but only if the parody is not being used as a desig-nation of source for the defendant’s own goods. Here, it was clear that

HDD was using CHEWY VUITON as a trade-mark for its own commercial products—not only was the mark prominently displayed on the prod-ucts, but also HDD had applied (unsuccessfully) to register CHEWY VUITON with the U.S. Patent and Trademark Office. Because the alleged parody was being used as a brand name or trademark for the defendant’s own goods, the statutory fair use defense should not have applied.

Second, in considering the dilution by blur-ring claim, INTA believes that the district court should not have relied on the three New York cases because those cases concerned a materially different statute—the New York State antidilu-tion act. Among other things, that act does not

One of the first cases involving the proper interpretation of the new U.S. Trademark Dilution Revision Act (TDRA) was recently heard by the U.S. Court of Appeals for the Fourth Circuit. The case, involving a chal-lenge to CHEWY VUITON chewable dog toys designed to look like LOUIS VUITTON handbags, raises two issues under the new U.S. federal dilution law. Because of the importance of these issues, INTA sought, and was granted, permission to participate in the appeal as amicus curiae. Significantly, the court also granted permis-sion for INTA Counsel David H. Bernstein, of Debevoise & Plimpton LLP, to participate in the oral argument. The argument was highlighted by questioning from the ap-pellate panel that seemed to indicate agreement with the positions advanced by INTA.

Defendant Haute Diggity Dog LLC (HDD) sells a line of products that it claims were designed to parody famous trademarks. Its chewable dog toys include products sold under such names as DOG PERIGNON, CHEWNEL #5, SNIFFINAY’S and CHEWY VUITON. Concerned that the sale of CHEWY VUITON products would impair its famous LOUIS VUITTON trademarks and copyrights, Louis Vuitton Malletier S.A. (LVM) filed suit against HDD alleging copy-right infringement, trademark counterfeiting, trademark infringement and dilution by both tarnishment and blurring.

Before the district court, the parties filed cross-motions for summary judgment. In No-vember 2006, Judge James C. Cacheris of the U.S. District Court for the Eastern District of Virginia issued his decision. Because he found no likelihood of dilution, no likelihood of con-fusion, no trademark counterfeiting, and that HDD was making a “fair use” of LVM’s copy- Continued on next page

Representing Trademark Owners Since 1878November 15, 2007�

Association NewsINTA Argues CHEWY VUITON Dilution Case Continued from previous page

expressly limit the parody defense to uses other than as a designa-tion of source, as does the TDRA, nor does it include any list of factors that courts should consider in assessing claims of blurring. Moreover, it is not the case that every parody should be protected based on the argument that parodies, by their nature, depend upon continued association with the famous mark. Instead, the district court should have applied the six factors listed in the new TDRA, which courts are supposed to consider in assessing whether an al-legedly diluting mark is likely to create associations that impair the famous mark’s distinctiveness:

1. The degree of similarity between the marks;2. The degree of inherent or acquired distinctiveness

of the famous mark;3. The extent to which the famous mark is exclusively used;4. The degree of recognition of the famous mark;5. Whether the defendant intended to create association

between its mark and the famous mark; and6. Any actual association between the defendant’s mark

and the famous mark.

Because of its interest in having the district court’s errors cor-rected, and with the hopes of obtaining an appellate decision that might guide other district courts faced with the question of how to interpret and apply the new TDRA, INTA sought to participate in the appeal as amicus curiae. Not only did INTA ask for leave to file an amicus curiae brief, but also, somewhat unusually, INTA asked for permission to participate in the oral argument. Despite HDD’s opposition, the appeals court granted INTA’s motions.

In its amicus brief, INTA argued that the district court’s decision should be reversed and the case should be remanded to the district court with instructions to re-analyze the dilution claim under the six TDRA factors. INTA also argued that the parody defense should not apply because, in this case, the alleged parody appeared to be used as a trademark for the defendant’s own goods.

On September 26, oral argument was held before a Fourth Cir-cuit panel of three judges. INTA Counsel David Bernstein argued first. After summarizing INTA’s position, Mr. Bernstein explained that the case should be reversed because of the district court’s failure to apply the TDRA. Through their questioning, the panel of judges appeared to agree with INTA’s arguments, acknowledg-ing that the district court failed to analyze the dilution by blurring claim under the six statutory factors. The court also indicated that the district court seemed improperly to have applied the parody defense even though HDD used the CHEWY VUITON name as a trademark for its own goods. One issue that engendered some debate was whether the Court of Appeals should reassess the case on its own, applying the six factors at the appellate level, or whether it should remand the case to the district court for more fact finding on the six factors.

LVM’s counsel, Michael A. Grow of Arent Fox, argued second. Mr. Grow reinforced the points argued by INTA, and the court reiterated that it seemed to agree with INTA’s argument. But the court also expressed uncertainty about whether the case had to be remanded, and whether parodies might still be protected when the six factors are analyzed. For example, one judge asked Mr. Grow if he “agreed with Mr. Bernstein’s analysis of the statute and how it is to be applied . . . that when the parody is used as a trademark, the only way to consider it is in the factors and not as a defense.”

The court questioned how the six factors would come out under such an analysis. “Look at the six factors. How does it play out? Is your mark being blurred? Or is your mark being enhanced? . . . . [I]f the message is pretty clear, then it may be . . . enhancing your mark and the parody may be strong enough. I mean, that, to me, is the difficult question in this case.” Thus, the court seemed to suggest that if the parody is obvious, consumers will understand that it clearly refers to and comments on the famous mark. Such parodies, the court seemed to think, might enhance consumers’ associations with the famous mark, rather than blur the famous mark’s distinctiveness.

Unfortunately, that analysis confuses the differences between infringement and dilution. Whether consumers understand that the use is a parody is often relevant when analyzing infringement claims (because consumers are not confused as to the parody’s source), but it is less relevant (and maybe even irrelevant) in the context of dilution claims. That is because antidilution law is designed to protect against a different kind of harm. The idea of dilution protection is based on the notion that when consumers encounter a famous, distinctive mark (like LOUIS VUITTON), they immediately associate that mark in their minds with one set of products, experiences and attributes. If they were to associate that famous mark also with other products, whether disparate products (hypothetical LOUIS VUITTON lawn fertilizer) or parody products (CHEWY VUITON dog toys), that would blur the mark’s distinctiveness: when consumers encounter the mark in the future, they would think of multiple sets of associations, rather than just the one set of associations created by the famous brand. If these products were not stopped, there could be so many associa-tions with the famous mark that the mark would lose its ability to convey to consumers’ minds a set of unique associations.

The argument, though, did not get into that deep level of dilu-tion theory, but focused on the narrow issues presented by the appeal. That held true in the questioning of James Petruzzi, of Mason & Petruzzi, who argued for HDD. Early on, Mr. Petruzzi essentially conceded that HDD had used CHEWY VUITON as a trademark and that the TDRA’s parody defense did not apply to HDD’s products. But, he maintained that the parody was not di-luting for the reason expressed in the three New York cases cited by the district judge. Mr. Petruzzi also argued that, in any event, the district court had considered the TDRA factors in other parts of its decision, and took those factors into account in rejecting LVM’s dilution claim. But the appeals court seemed to indicate that further analysis under the factors was required. One judge asked: “If, hypothetically, it turned out that we were not satisfied with the district court’s consideration of, the adequacy of its treatment of, some of these issues, do you want to go back to the district court, or do you want us to do it?” Mr. Petruzzi answered that, in his view, the appeals court could reassess the factors, if necessary.

From the oral argument, it appears likely that the Fourth Circuit will adopt INTA’s principal arguments—that the district court should not have applied a parody defense and that the district court erred in failing to specifically analyze the blurring claim un-der the TDRA factors. Whether the Court of Appeals will remand the case for further proceedings by the district court, or whether it will assess the factors itself (and if so, how it will treat the alleged parody), remains to be seen. A decision is expected in early 2008.

www.inta.org Vol. 62, No. 21 3

California Adopts Model State Trademark BillOn October 14, California Governor Arnold Schwarzenegger signed into law AB 1484—the most current version of INTA’s Model State Trademark Bill (MSTB). The legislation replaces California’s trademark statutes in their entirety, although several of California’s specific provisions regarding damages, anticounterfeit-ing, vicarious infringement and seizures were included in the bill. The new statute contains the likely-to-cause dilution standard adopted in recent federal legislation and other recent amendments to the MSTB, such as the rejection of niche fame.

Catherine Holland, a partner at Knobbe Martens Olson and Bear LLC and a member of INTA’s MSTB Subcommittee, spon-

On October 16, 2007, the Academic Subcommittee of INTA’s Membership Services Committee hosted a panel presentation for law students in the San Francisco Bay Area. “Considerations for Careers in Trademark Law: A Panel Discussion for Law Students” was held at the offices of Coblentz, Patch, Duffy, and Bass LLP in the Ferry Building in downtown San Francisco. More than 40 students attended the event, and many came armed with ques-tions for the panelists. Questions ranged from “What are the best publications and blogs to read to keep up with trademark issues?” to “How do you position yourself for a position in trademark groups in firms, which are oftentimes very competitive?” The pan-elists were Nate Garhart, partner at Coblentz, Patch, Duffy, and Bass LLP; David Gooder, chief trademark counsel at Jack Daniel’s Properties and Brown-Forman Corporation; and Heather Dunn, associate at DLA Piper. The discussion was moderated by Kelly McCarthy, an associate at Sideman & Bancroft LLP. The event concluded with a reception hosted by Sideman & Bancroft LLP.

The Academic Subcommittee has been organizing this project for some time. The same panel discussion (with different panelists) had been offered at the Annual Meetings in Toronto in 2006 and

in Chicago in 2007, and was well attended on both occasions. In response to positive feedback, INTA approved a proposal to offer the program in a number of major legal markets over the next few years. Next year, the program will be offered in Paris, in Berlin at the 2008 Annual Meeting and at a number of other locations.

After attending this event in San Francisco, a number of stu-dents provided very positive feedback. Ellen Bass, from the Univer-sity of San Francisco, wrote: “Thank you so much for taking the time out of your busy schedule to arrange . . . the discussion. The comments were extremely interesting and very helpful about get-ting started in trademark practice in the Bay Area, and I hope that INTA is able to host many more such events in the future. I would love to stay in touch, and will . . . become a member of INTA to participate in future events.”

It is hoped that the numbers of student members will increase as a result of outreach programs like this and that INTA will continue to be successful in building its own brand in the legal academic community.

By: Kelly McCarthy, Sideman & Bancroft LLP, San Francisco, California, INTA Membership Services Committee, Academic Subcommittee

So You Want To Be a Trademark Lawyer?

sored the bill up through the California Conference of Delegates, and worked with Assembly member Paul Krekorian to pass the leg-islation. Britt Anderson of Cooley Godward and other members of the MSTB Subcommittee spent many hours supporting this effort. In addition, several INTA member companies—including the Clo-rox Company, Oakley Inc., Sunkist and Universal Studios—sent letters of support.

Passage of this bill furthers INTA’s mission to promote unifor-mity to the trademark laws of the United States. California joins the more than 30 states that have already adopted some version of the 1996 MSTB.

WHAT’S COOkING IN EUROPE?AN ADVANCED DISCUSSION AND CRITICAL REVIEW OF

TRADEMARk PRACTICE, PROTECTION AND ENFORCEMENTDecember 3 – 4, 2007 | Lisbon, PortugaL

THERE’S STILL TIME TO REGISTER!PUT YOUR ORDER IN NOW TO jOIN INTA’S “MASTER CHEFS” AS THEY ExPLORE

WHAT’S COOkING IN EUROPE.

A distinguished faculty will present an in-depth discussion of the legal mechanisms and strategies for protecting trademarks in the EU and their broader global implications.

This program is the perfect opportunity to satisfy your appetite for trademark knowledge with topics covering:• Is the Madrid Protocol a good recipe – an evaluation• The effect of the “use” ingredient in the Community trade mark (CTM)• Global recipes for enforcement using ingredients from Customs authorities• Kitchen management – Working as a team with outside counsel• New recipes (and decisions) from the European Court of Justice, the European

Court of First Instance and OHIM Board of Appeals

Don’t miss this chance to join your colleagues in Lisbon to get a flavor for the current trademark climate in Europe!

ONSITE REGISTRATION IS AVAILABLE! WE HOPE TO SEE YOU THERE!

Representing Trademark Owners Since 1878November 15, 2007�

Association NewsRoundtable Roundup

On October 8, Baker & McKenzie’s Barcelona office hosted “A Practical View of the Newly Implemented En-forcement Directive in Spain.” José Mª Fernández Seijó, Justice of the Commercial Court in Barcelona, spoke on improvements to discovery, damages and other areas.

Sargent & Krahn hosted a September 6 roundtable in Santiago to discuss “Chile on the Watch List.” The topic referred to the country’s status with respect to the U.S. Trade Representative’s standards for IP rights protection.

“Dilution of Marks and Secondary Meaning” was the subject of the October 4 roundtable at the UNICLUB Quito, Ecuador, organized by Corral & Rosales. The 40 attendees included representatives of law firms in Quito and Guayaquil, as well as the Ecuadorian Institute of Intellectual Property.

Pittaluga & Associates hosted “The Present and Future Situation of the Uruguayan Patent & Trademark Office – Perspectives on New International Agreements” on September 6 in Montevideo. The Uruguayan Association of IP Attorneys and ASIPI co-organized the event.

“The Administrative Opposition Process in Argentina” was the subject of the September 27 roundtable hosted by Sena & Berton Moreno in Buenos Aires. Participants discussing Argentina’s unique opposition system included authorities from the National Board of Industrial Property.

On September 28, Landívar & Landívar hosted “The Observance of Intellectual Property in Bolivia” in La Paz. Among the speakers was Inés Palomeque, Director of the National IP Office.

www.inta.org Vol. 62, No. 21 5

Declarations of Fame and Notoriety in MexicoWell-known marks have received special protection since Mexico ratified the Paris Convention in 1928. Also, TRIPS and NAFTA contain special provisions regarding well-known marks. In practice, however, litigation involving well-known marks is extremely rare.

In 2005, Mexico amended its Industrial Property Law (LPI) to create a special register of famous and well-known marks. Recently, the Mexican Institute of Industrial Property (IMPI) published a fee schedule and began accepting applications. This article reviews the new system.

WHAT IS A FAMOUS OR WELL-KNOWN MARK?

Article 98bis of the LPI states that a mark is well known if “a given sector of the public or the country’s business circles is aware of the mark as a result of business activities conducted in Mexico or abroad by a person who makes use of the mark in connection with his goods or services; or as a result of the promotion or adver-tising thereof.”

Famous marks are a new category created by the 2005 amend-ments. A mark is famous if “it is known by the majority of the consuming public.”

WHAT IS THE SIGNIFICANCE OF FAME AND NOTORIETY?

Historically, Mexico applied the “principle of specialty,” which limited trademark protection to goods or services in the class for which the mark was registered. The law afforded broader protec-tion to well-known marks as an exception to this rule. The new legislation reinforces this exception and provides still greater protection to famous marks.

Well-Known MarksLPI Article 90.XV prohibits the registration of any mark that:

• Is likely to be confused or associated with a well-known mark;• Is an unauthorized exploitation of a well-known mark; or• Tarnishes or dilutes the distinctiveness of a well-known mark.

Previously, the law protected well-known marks against the use or registration of marks that created confusion or a risk of associa-tion. The amendments add three new concepts: unauthorized exploitation, tarnishment and dilution.

However, the policies being adopted by IMPI may limit this protection. An applicant must pay a separate fee for each class to be covered by the declaration of notoriety. For example, the owner of a trademark registration covering goods in Class 3 may seek a declaration of notoriety covering Classes 1, 5 and 10.

This implies that a mark may be well known in some classes but not in others. In theory, these classes should correspond to the sector of the public that is familiar with the mark. However, goods are classified according to their nature and essential characteris-tics, and not according to the type of people that purchase or use them. (For example, all goods used by dentists do not fall within a single class.) Thus, the use of the classification system may lead to arbitrary results.

Famous MarksArticle 90.XVbis of the LPI prohibits the registration of any

mark identical or similar to a famous mark, regardless of the goods or services involved. There is no need to prove a likelihood of confusion, association, dilution, etc.

A DECLARATION OF FAME OR NOTORIETY

A primary goal of the 2005 amendments was to enable IMPI to consider fame or notoriety during trademark examination. This has been impossible up until now, since the courts have held that trademark examiners must have a basis for determining that a mark is well known, and examiners lack the means to gather the necessary evidence.

Mexico is now one of the few countries lacking an opposition system. Once a mark is registered, the owner of a prior mark can-not sue for infringement without first obtaining cancellation of the contested mark’s registration—a process that can take years. Thus, the examiner’s role is vitally important.

If necessary, a cancellation petitioner may argue that registration should have been refused on the basis of its famous or well-known mark. The impact of fame or notoriety in trademark infringement actions is less clear, particularly given the limited contact between the division of IMPI responsible for enforcement and the division responsible for granting declarations of fame and notoriety.

Article 213.VII of the LPI prohibits the use of a mark that would be refused registration under Article 90.XV—in other words, any mark that violates the rights of the owner of a well-known mark.

However, Article 213.VII does not refer to famous marks. Thus, it is not clear whether the owner of a famous mark can prevent the use of an identical or similar mark without proving a likeli-hood of confusion or association. Perhaps the general prohibition against unfair competition in Article 213.I is broad enough for this purpose. The owner of a famous mark should be entitled at least to the same benefits in an infringement action as the owner of a well-known mark. Eventually, the courts or Congress will have to resolve this issue.

IS A DECLARATION NECESSARY?

The owner of a famous or well-known mark receives enhanced protection, regardless of whether IMPI has issued a declaration. However, a declaration has two important benefits. As noted before, a mark that has been declared well-known or famous casts a longer shadow during ex parte examination. In addition, the owner of the declaration will be spared the burden of proving that its mark is well known or famous every time it files a cancellation petition. The same will probably be true in trademark infringe-ment litigation, although the law is not clear on this point.

PROOF OF FAME OR NOTORIETY

The LPI states that a mark is well known if a particular market niche is aware of the mark, but the law does not specify a particu-lar level of awareness. A famous mark must be known to a majority of the general public—that is, it has an awareness level exceeding 50 percent.

Article 98bis-2 of the LPI states that an applicant must provide at least the following information and documents:

• Level of awareness among actual or potential purchasers, as shown by market research

• Level of awareness among other sectors of the public, or the trade

• Date of first use, and duration of continuous use, in Mexico and abroad

Features

Representing Trademark Owners Since 1878November 15, 2007�

FeaturesMexico Continued from previous page

• Channels of trade, in Mexico and abroad• Means by which the mark is publicized, in Mexico and abroad• Duration of advertising, in Mexico and abroad• Advertising expenditures for the last three years• Geographic extent of use• Sales volume or income earned during the last three years• Economic value of the mark, as shown by financial statements

or a valuation study• Trademark registrations in Mexico and abroad• Identity of any franchisees or licensees• Market share data

If the statute is read literally, an application must be rejected if it lacks any of the required documents or information. For example, an applicant may have to commission a brand awareness study on its mark if it has not done so already. IMPI has stated, but not in writing, that it will accept valuations of an applicant’s total intangi-ble assets as evidence of the economic value of its mark. However, this may be at odds with the statute, which requires a valuation of the particular mark at issue.

IMPI also states (but not in writing) that it will protect the confidentiality of information supplied by applicants. However, Article 98bis-8 states that a declaration may be invalidated if the evidence filed with the application was false or incorrectly evalu-ated. This implies that a party seeking to invalidate a declaration will have access to any confidential information in the file.

PROCEDURAL ISSUES

IMPI has created a special unit to examine applications for dec-larations of fame or notoriety. All resolutions granting or denying such applications will be published in the Official Gazette.

A declaration of fame or notoriety will have evidentiary effect for a period of five years from the date of issuance. The declaration may be renewed if the owner proves that its mark continues to be well known or famous.

IMPI may invalidate a declaration of fame or notoriety at the request of a third party if the declaration was granted in violation of the law, the application contained false statements of fact, the examiner evaluated the evidence incorrectly or the declaration is-sued to a person other than the owner of the mark.

An applicant for a declaration of fame or notoriety must own a basic Mexican registration for the same mark. The assignment of the trademark registration will automatically result in the assign-ment of the declaration. Similarly, the declaration will be cancelled if the underlying trademark registration is cancelled or expires.

CONCLUSION

The 2005 amendments to the legislation, and IMPI’s imple-menting regulations, are a significant step forward. It remains to be seen how readily declarations of fame and notoriety are granted. In addition, there are a number of flaws and ambiguities in the stat-ute, which will need to be addressed by Congress and the courts in the coming years.

By: John M. Murphy and Cristóbal Mariscal, Arochi, Marroquin & Lindner S.C., Mexico City. Mr. Murphy is a member of the INTA Bulletin Features–Policy & Practice Subcommittee

Thursday, january 3, �008 • �:00 p.m. – �:00 p.m.

This symposium will examine the likelihood of confusion standard, with tools and insights drawn from both legal scholars and social scientists who have begun to examine trademark law in light of theoretical models and empirical studies of consum-er behavior. Speaker topics will include:• Trademarks and the Reasonably Prudent Buyer: A

Theoretical and Empirical Analysis of Consumer Sophistication.

• The Ordinary Sensible Purchaser in Trademark Law: What is this Creature in Asia?

• “Closed-Ended Questions Are Leading Questions” and Other Nonsense

FEATURED SPEAkERS:jacob jacoby, Merchant’s Council Professor of Consumer Behavior and Retail Management at New York University’s Leonard N. Stern Graduate School of Business – New York, New York

Ng-Loy Wee Loon, Associate Professor and Direc-tor of the LLM (Intellectual Property and Technology) program at the National University of Singapore Faculty of Law

Thomas R. Lee, Professor of Law at Brigham Young University – Provo, Utah

MODERATOR:David C. Berry, Professor of Law and Assistant Director, Graduate Program in Intellectual Property Law at Thomas M. Cooley Law School – Rochester, Michigan

LOCATION:Offices of DLA Piper1251 Avenue of the Americas, 27th FloorNew York, New York 10020-4500

VISIT WWW.INTA.ORG/GO/EDUCA-TION TO REGISTER AND FOR MORE

INFORMATION.

SPECIAL THANKS TO DLA PIPER FOR HOSTING THIS EVENT.

Presenting INTA’s 4th Annual

LEARNED PROFESSORS TRADEMARk SYMPOSIUM

AN INTERDISCIPLINARY PERSPECTIVE ON THE LIKELIHOOD OF CONFUSION

www.inta.org Vol. 62, No. 21 7

Law and PracticeBRITISH VIRGIN ISLANDS

New Uk Legislation Affects Some BVI TrademarksThe Trade Marks (Relative Grounds) Order 2007, which came into force in the United Kingdom on October 1, 2007, abolished the examination of relative grounds for refusal of an application to register a trademark. Some trademarks registered in the British Virgin Islands are affected.

The Registration of United Kingdom Trade Marks Act (Cap. 157) is one of two trademark regimes in the British Virgin Islands. It allows for any registered proprietor of a UK trademark to apply for its registration in the British Virgin Islands. The same privileges and rights in the use of the UK trademark in respect of the goods entered in the BVI register would be conferred on the registered proprietor as in the UK, mutatis mutandis, for as long as the registration in the UK remains in force in respect of the goods for which the trademark is registered in the British Virgin Islands.

When relying on a prior UK registration to obtain registration in the British Virgin Islands, the BVI registration is automatic, as it anticipates that examination of the application has taken place in the UK. The Registrar has no power to independently examine any application based on a prior UK registration or to refuse such application based on any absolute or relative ground. However, with the abolition of the relative grounds for refusal in the UK it is possible, as in the UK, for identical and confusingly similar trademarks to appear on the BVI register. This exposes trademark owners to greater risk and requires greater vigilance, not only on the UK register, but also on the corresponding BVI register.

Contributor: Jamal S. Smith, Harney Westwood & Riegels, Tortola, British Virgin Islands; Verifier: Carrollanne Lindley, Kilburn & Strode, London, UK

CHINACourt Awards Top Penalties for Willful Infringement Where Damages, Profits Were Not AscertainableOn August 22, 2007, the Shanghai First Intermediate People’s Court issued a decision in favor of U.S. beer company Anheuser-Busch Inc. in trademark infringement proceedings. The court ordered Chinese brewer Putian Jinchi Beer Co. Ltd. to stop in-fringement and pay RMB 500,000 (US $66,667) in compensatory damages and RMB 100,000 (US $13,333) in punitive damages. In addition, the court ordered four of Jinchi’s distributors to immedi-ately stop selling the infringing products.

Anheuser-Busch registered its trademark BUDWEISER in China in 1998. On September 1, 1999, Anheuser-Busch reached a license agreement with Budweiser Wuhan International Brewing Ltd. (Budweiser Wuhan), authorizing Budweiser Wuhan to use BUDWEISER and other related registered trademarks in main-land China. These marks included the word mark BAIWEI (the transliterated Chinese character mark for BUDWEISER) and a device mark comprising a ribbon and an ear of wheat (Budweiser device mark).

In 2006, Anheuser-Busch discovered that several of Jinchi’s dis-tributors in Shanghai, Jiangsu, Guangdong, Zhejiang and Tianjin were selling Jinchi’s New Generation Beer. These products used a mark that was substantially similar to the Budweiser device mark. They were also prominently using the words “American Budweiser Beer International Group Co Ltd” on their product packages. The Administrations for Industry and Commerce (AIC) in Shanghai, Jiangsu and Jiangxi took several administrative actions against Jinchi’s distributors.

Anheuser-Busch then filed trademark infringement proceedings against Jinchi and its four distributors, requesting that the court order (1) the four distributors to immediately stop selling the infringing products, (2) Jinchi to stop manufacturing and selling all infringing products, (3) Jinchi to destroy all infringing products in stock and (4) Jinchi to pay RMB 500,000 (US $66,667) as compensation.

The four distributors attended the hearing. They acknowledged that they had sold Jinchi’s New Generation Beer and had stopped selling after the AIC’s enforcement actions. No representative of Jinchi attended the hearing.

The court held that the label and device logo on Jinchi’s prod-uct packaging were similar to the Budweiser device mark, and would mislead customers into believing that Anheuser-Busch had authorized Jinchi’s beer. The court held that Jinchi had infringed Anheuser-Busch’s exclusive right in the Budweiser device mark.

The BUDWEISER mark enjoys a good reputation with custom-ers in China. Jinchi, as a professional brewer, should have known of Anheuser-Busch and its BUDWEISER mark. Despite this knowledge, Jinchi intentionally and prominently used the enter-prise name of Anheuser-Busch in the company name referenced on its packaging (as well as using a mark substantially identical to the Budweiser device mark), which would cause confusion to custom-ers as to the source of Jinchi’s products. It also infringed Anheuser-Busch’s exclusive right in the mark BAIWEI.

The court held that it could not determine Jinchi’s profits obtained from the infringement or Anheuser-Busch’s loss suffered by Jinchi’s infringement. Therefore, it exercised its discretion to order Jinchi to pay RMB 500,000 (US $66,667), the statutory maximum provided under the Trademark Law, to Anheuser-Busch. The court also imposed on Jinchi a civil penalty of RMB 100,000 (US $13,333) on Jinchi.

This case attests to the fact that the Chinese courts are tak-ing a more proactive approach to enforcement of multinational companies’ IP rights. In this case, the court exercised its discretion to grant the statutory maximum in compensation to the IP owner and imposed heavy punitive damages on the infringers, which should act as a good deterrent to other infringers.

Contributors: Connie Carnabuci and Yan Hao, Freshfields Bruckhaus De-ringer, Hong Kong; Verifier: Andy An, An, Tian, Zhang & Partners, Beijing

Representing Trademark Owners Since 1878November 15, 20078

Law and PracticeCHINA

Infringement Found Where Two Company Names Use Same Three Characters In Different Order

In October 1995, Guangzhou Cai Gen Xiang registered “Cai Gen Xiang” as a trademark covering “restaurant and fast food shop” services in Class 42. Beijing Cai Xiang Gen Restaurant Company was founded in April 1998, and its business scope included serving Chinese food and beverages.

Guangzhou Food and Beverage Company, the parent of Guangzhou Cai Gen Xiang, believed that Beijing Cai Xiang Gen Restaurant had infringed its exclusive rights in the “Cai Gen Xiang” mark and brought trademark infringement proceedings in the Beijing Chaoyang District People’s Court. It sought court orders to stop Beijing Cai Xiang Gen Restaurant from infring-ing its rights, for an award of RMB 500,000 (US $66,667) in compensatory damages and for publication of an apology in the Beijing Evening News.

The Chaoyang Court held that “Cai Xiang Gen” had infringed the reg-istered trademark “Cai Gen Xiang” and that Beijing Cai Xiang Gen should cease its infringing activities, publish an apology in a newspaper and pay RMB 52,500 in compensatory damages. Beijing Cai Xiang Gen Restaurant appealed the case to the Beijing No. 2 Intermediate People’s Court.

The Beijing No. 2 Intermediate People’s Court held that the mark “Cai Xiang Gen” used by Beijing Cai Xiang Gen Restaurant Company was a combination of three Chinese characters that were the same as the registered trademark “Cai Gen Xiang.” The only difference was their order, and this was sufficient to confuse and mislead the relevant public.

It was held that Beijing Cai Xiang Gen Restaurant had infringed the regis-tered trademark in question and was ordered to cease its infringing activities, clarify the confusion and pay damages. The first-instance judgment was upheld, and this is a final decision.

Contributors: Connie Carnabuci, Freshfields Bruckhaus Deringer, Hong Kong; Veri-fier: An Xiaodi, An & Partners, Beijing

CHINA

Pub Name with Different Spelling But Same Pronunciation Is Infringing

THE BLUE LOTUS and LOTUS BLUE BAR were two pubs within the same area in Beijing. Blue Lotus Company was founded in October 2002 and registered the mark THE BLUE LOTUS in Chinese (pronounced Lan Lian Hua) in 2001. The mark LOTUS BLUE BAR in Chinese (pronounced Lan Lian Hua) was owned by Lan Lian Hua Fang Company, which was founded in October 2003.

In March 2004, Blue Lotus Company filed a claim with the Beijing No. 1 Intermediate People’s Court against Lan Lian Hua Fang Company, alleging that the latter had infringed its exclusive rights in the registered trademark THE BLUE LOTUS (in Chinese) and that such use also constituted unfair competition.

The Beijing No.1 Intermediate People’s Court held that the companies had been engaged in the same business and the two marks were identical in pronuncia-tion. The use of the enterprise name of Lan Lian Hua Fang Company had caused confusion with the service provided by Blue Lotus Company. Therefore the court held that Lan Lian Hua Fang Company had infringed the trademark rights of Blue Lotus Company and had engaged in unfair competition.

Lan Lian Hua Fang Company was ordered to cease using LOTUS BLUE BAR (in Chinese), pay Blue Lotus Company RMB 40,000 in compensatory damages and make an apology in a newspaper. Lan Lian Hua Fang Company appealed the case to the Beijing Higher People’s Court.

The Beijing Higher People’s Court held that Blue Lo-tus Company had the right to stop any third party from using its registered trademark or similar marks used in respect of the same or similar services. A pub name was the key sign used by the relevant public to distinguish one pub from another. The pronunciation and meaning of Lan Lian Hua Fang Company was the same as the registered trademark owned by Blue Lotus Company such that the relevant public could be easily confused and there had been unfair competition, even though the texts in question were slightly different.

However, the Beijing Higher People’s Court held that LOTUS BLUE BAR (in English) used by Lan Lian Hua Fang Company and THE BLUE LOTUS (in English) used by Blue Lotus Company were two different combi-nations of texts with different pronunciation so that no infringement had been caused. The first-instance judge-ment was upheld. This is a final decision.

Contributors: Connie Carnabuci, Freshfields Bruckhaus De-ringer, Hong Kong; Verifier: An Xiaodi, An & Partners, Beijing

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www.inta.org Vol. 62, No. 21 �

GERMANY

Court Freezes .eu Domain to Avert Bad Faith TransferIn a recently published decision dated August 10, 2007 (Docket No. 5 W 230/07), the Court of Appeal of Berlin (Kammergeri-cht) held that the transfer of a .eu domain may be prohibited if it infringes a party’s name rights.

In this case, the plaintiff tried to obtain a preliminary injunction prohibiting the further use and registration of a .eu domain for a competitive website, as well as a transfer of the domain to a third party. While the district court confirmed the alleged company name right infringement, it rejected the claims for cancellation of the domain and for an order restraining transfer of the domain.

In preliminary injunction proceedings under German law, it is not possible to apply for a court decision that would have a final, irreversible effect—so the plaintiff could not request that the do-main be cancelled. But as a consequence of this rule, the plaintiff runs the risk that the defendant might transfer the domain to a third party with the same name as the plaintiff. This might have justified the continuing registration of the domain.

While the German domain registry administering the do-mains under the country code top-level domain .de provides for a proceeding to freeze .de domains that are subject to a pending dispute (“dispute entry” proceeding), thereby making a transfer of the respective domain to a third party impossible, there is no such policy for .eu domains.

IRAQ

Boycott Declaration No Longer Required

The Iraqi Ministry of Industry announced that the requirement relating to furnishing a boycott declaration for trademark applica-tions in Iraq has been lifted with effect from July 22, 2007.

Trademark applicants are no longer required to give a signed boycott declaration.

The Iraqi Trademarks Office has started to process pending trademark applications that have been awaiting approval for years.

Source: Mohammed Al-Jabouri, Abu-Ghazaleh Intellectual Property (AGIP) Notice, Iraq

Contributor: Linda Moeketsane, Spoor & Fisher, Pretoria, South Africa

LEBANON

Ninth Edition of the Nice Classification

On October 1, 2007, the Lebanese Trademark and Patent Office adopted the Ninth Edition of the Nice International Classification of Goods and Services (which came into force on January 1, 2007) and is now ready to receive trademark applications for goods and services in the those classes. Previously, the Trademark and Patent Office followed the Eighth Edition of the Nice Classification.

Contributor: Zeina Salameh Georr, Saba & Co. IP Head Office, Beirut; Verifier: Kamal Berti, Berti Law Office, Beirut

On appeal of the district court’s decision, the Court of Appeal of Berlin found that it was not only the use of the domain name that infringed the plaintiff ’s company name rights, but also its registra-tion, and that therefore the plaintiff had a legitimate interest in preventing defendant from transfering the domain to a third party. Otherwise, the existing, justified claim for cancellation of the domain would have been undermined. Thus the appeals court held that the plaintiff could ask that the challenged domain be made subject to a restraint on transfer making a transfer ineffective.

The appellate court required a likelihood that the domain was actually transferred but found such a likelihood from the defen-dant’s intention to obstruct the plaintiff by virtue of the domain registration and its redirection to the defendant’s website. This allowed an assumption that the defendant would try to maintain its obstruction of the plaintiff by transferring the domain.

This decision strengthens the position of name right owners. It can be assumed that it will be applied also in cases of trademark infringement, and over against domains other than .eu domains if the respective domain registry does not provide for a proceeding to freeze challenged domains as long as an infringing domain has not been cancelled.

Contributor: Martin Viefhues, Jonas Rechtsanwaltsgesellschaft mbH, Cologne; Verifier: Wolfgang Festl-Wietek, Viering Jentschura & Partner, Munich

INTERNATIONAL TRADEMARk BASICSCambridge, Massachusetts, USA

December 3 – �, �007There’s still time to register!

join your colleagues to explore the manyaspects of the life of an international trademark.

Over the course of the two-day program, a panel of trademark experts from around the world will trace the life cycle of a trademark, making this a perfect program for:

• Experienced practitioners new to international trademarks

• In-house and law firm attorneys for whom trademarks may form only a part of their practice

• General counsel of companies with international business activities

• Trademark administrators and paralegals wanting an overview of international trademark issues

Topics for Discussion Include:• Complexities of multi-jurisdictional

trademark protection• Initial searching and clearance• Opposition and cancellation actions• Overview of global trademark

treaties and agreements• Post-grant matters, including portfolio

management, enforcement and counterfeiting• Business transactions

Onsite registration is available! We hope to see you there!

www.inta.org Vol. 62, No. 21 11

UNITED STATES

Federal Trade Commission Fines TyposquatterOn October 16, 2007, the Federal Trade Commission (FTC) is-sued an order fining typosquatter John Zuccarini US $164,000 for diverting Internet users from their intended websites to one of his sites displaying adult-oriented advertisements. This order updates and enhances the compliance and monitoring requirements origi-nally issued by the FTC in 2002.

In 2001, the FTC charged Zuccarini with typosquatting—regis-tering Internet domain names that were intentional misspellings of legitimate domain names or that included transposed or inverted terms. When Internet users were taken to Zuccarini’s sites, they were bombarded with windows that displayed advertisements for pornography and other adult-oriented products and services. Accordingly, in 2002, the FTC asked the court to permanently bar Zuccarini from redirecting consumers on the Internet or obstructing them from their intended Internet destinations. Under the 2002 order, Zuccarini was fined US $1.8 million in ill-gotten gains and was subjected to certain bookkeeping and recordkeeping requirements that would allow the FTC to monitor his compliance with the order.

In 2003, the U.S. Attorney for the Southern District of New York criminally prosecuted Zuccarini for typosquatting and posses-sion of child pornography. Zuccarini pled guilty to those charges and was sentenced to 30 months in jail and 36 months of super-vised release. Within a year of his release from prison, the FTC charged Zuccarini with violating the 2002 FTC order. Specifically, he was charged with redirecting Internet users, misrepresenting the affiliation of his domain names and failing to comply with the recordkeeping and reporting requirements of the original order.

At this time, the original 2002 order remains in place and the new order updates and enhances the compliance and monitoring requirements. In addition, Zuccarini must provide a copy of the new order to his probation officer. Zuccarini admitted no wrong-doing under the current settlement.

Sources: “Internet Hijacker, Mousetrapper Settles FTC Charges,” Federal Trade Commission (Oct. 16, 2007); “Porn ‘Typosquatter’ Gets $164K Fine,” Xbiz.com (Oct. 17, 2007).

Contributor: Jessica S. Sachs, Harness, Dickey & Pierce, P.L.C., Troy, Michigan; Verifier: Kevin W. Grierson, Willcox & Savage, P.C., Norfolk, Virginia

The INTA Bulletin Board announces job changes or other significant career news about individuals who work for INTA members. To submit an item for consideration, send a brief message with the individual’s name, position, firm and firm location to bulletin@inta.org.

For permission to reproduce INTA Bulletin articles, send a brief message with the article’s name, volume and issue number, proposed use and estimated number of copies or viewers to bulletin@inta.org.

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UNITED STATES

California: Truth in Music Advertising ActBeginning January 1, 2008, individuals performing live music under the name of a group that previously recorded music will be prohibited from advertising and performing under that name in California, except under limited circumstances.

California Governor Arnold Schwarzenegger signed the Truth in Music Advertising Act, AB 702, on October 10, 2007. The Act seeks to protect consumers and musical recording groups from “imposter” performing groups that use names such as the Platters, the Drifters and the Coasters but that have no affiliation with the original groups that performed and recorded music under those names. California joins Pennsylvania, Connecticut and Michigan as states that have enacted similar legislation.

Under the Act, groups can advertise and perform under the original recording group’s name if one of the following conditions is met:

• The performing group holds a federal trademark registration for the name of the group;

• One member of the performing group was previously a mem-ber of the recording group and has a legal right to use the name;

• The live musical performance or production is identified in all advertising as a tribute or salute, and the name of the per-forming group is not so similar to the name of the recording group that it would confuse or mislead the public; or

• The advertising does not relate to a performance or produc-tion taking place in California.

John “Bowzer”’ Bauman, a member of the 1970s group Sha Na Na, remarked, “Now California audiences will know that they’re getting what they paid for when they go to see a show, and the musical pioneers of the Doo-Wop era, as well as all musical groups from now on, can rest assured that their legacy is safe from this insidious kind of identity theft.”

Source: Assembly Bill No. 702 (Oct. 10, 2007); “Governor Signs Truth in Music Advertising Legislation,” California Chronicle, Oct. 16, 2007

Contributor: Leigh Ann Lindquist, Sughrue Mion, PLLC, Washington, D.C.; Verifier: Jessica S. Sachs, Harness, Dickey & Pierce, P.L.C., Troy, Michigan

INTA Bulletin BoardRichard Ashmead has retired as senior partner of Kilburn & Strode, London, UK, and is now practicing on his own account as an international IP consultant based in Hampshire, England. Mr. Ashmead is principal editor of INTA’s online International Oppo-sition Guide and a contributor to Worldwide Trademark Transfers.

Rouse & Co. has announced two transfers. Sara Holder has moved from Jakarta, Indonesia, to Dubai, where she will head the Dispute Resolution team. Edward Hardcastle has returned to the UK after spending the last ten years in Hong Kong and Dubai. Ms. Holder is a member of INTA’s International Amicus Commit-tee, and Mr. Hardcastle is a member of the Anti-Counterfeiting and Enforcement Committee.

International Trademark Association655 Third Avenue, 10th FloorNew York, NY 10017 USA+1-212-768-9887 • f: +1-212-768-7796www.inta.org • info@inta.org

November �0 – December 3, �007Roundtable: Policing and Protecting Trademarks in an Internet WorldVarious Canadian cities

December 3 – �, �007What’s Cooking in Europe? An Advanced Discussion and Critical Review of Trademark Practice, Protection and EnforcementLisbon, Portugal

December 3 – �, �007International Trademark BasicsCambridge, Massachusetts, USA

December 13, �007Roundtable: Quo vadis Markenrecht? Quo vadis Europa?Munich, Germany

january 3, �008Fourth Learned Professors Trademark SymposiumAn Interdisciplinary Perspective on the Likelihood of ConfusionNew York, New York, USA

March 11 – 1�, �008INTA / IP Australia ConferenceTrademark Regatta – Asia-PacificSydney, Australia

May 17 – �1, �008130th Annual MeetingBerlin, Germany

INTA BuLLeTIN COMMITTEETo contact the INTA Bulletin Committee, send an email to the managing editor at bulletin@inta.org.

ChairMary DeLongis, VF Sportswear, Inc.

Vice ChairKay Rickelman, Spoor & Fisher

Feature Articles: Member Benefits & ServicesPatrick Gallagher, Fulbright & Jaworski L.L.P.

Feature Articles: Policy & PracticePatricia Wilczynski Brozek, Wilczynski Brozek Law

Law & Practice: AmericasJanice Housey, Roberts, Mlotkowski & Hobbes, P.C.

Law & Practice: Asia-PacificConnie Carnabuci, Freshfields Bruckhaus Deringer

Law & Practice: Europe and Central AsiaClaus Eckhartt, Bardehle Pagenberg Dost Altenburg Geissler

Law & Practice: Middle East and AfricaStephen Goldberg, Spoor & Fisher

STAFFExecutive Director Alan C. Drewsen, International Trademark Association

Director, Publishing Randi Mustello, International Trademark Association

Managing Editor, INTA BulletinJames F. Bush, International Trademark Association

Associate Editor, INTA BulletinJoel L. Bromberg, International Trademark Association

Designer Jesse Riggle, International Trademark Association

OFFICERS & COUNSELPresidentDee Ann Weldon-Wilson, Exxon Mobil Corporation

President ElectRhonda Steele, Mars, Incorporated

Vice PresidentRichard Heath, Unilever P.L.C.

Vice PresidentHeather C. Steinmeyer, Blue Cross and Blue Shield Association

TreasurerGerhard R. Bauer, DaimlerChrysler AG

SecretaryGregg Marrazzo, Kimberly-Clark Corporation

CounselDavid H. Bernstein, Debevoise & Plimpton LLP

INTA Department Email AddressesCustomer Service: customerservice@inta.orgMeetings & Programs: meetings@inta.orgJob Bank: jobbank@inta.orgMembership: membership@inta.orgPublications: publications@inta.orgPublic Policy: tmaffairs@inta.orgPublic Relations: publicrelations@inta.orgRoundtables: roundtables@inta.orgSponsorship & Exhibitions: sponsorship@inta.orgThe Trademark Reporter®: tmr@inta.org

© 2007 International Trademark Association

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