September 2003

Record Companies, Artists, Merchandisers, Internet

International Bancorp LLC et all -v- Societe des Bains et du Cercle des Etrangers A Monaco (May 19, 2003)

In a split decision a United States Court of Appeal (Fourth Circuit) held that a non-US Company’s use of a non-US trademark in advertising in the United States was enough to give that company trade mark protection under US law despite the fact that the mark was not registered in the US. In US law an unregistered mark can be protectible if it is (a) distinctive and it is (b) “used in commerce”.
In this case, concerning the company (SBM) which owns the Casino de Monte Carlo, the court held that extensive advertising in the US and sale of services to US citizens in the USA was sufficient to satisfy the second requirement – that mark was used in commerce – even though the actual business was based in Monte Carlo and the services provided outside of the USA. SBM spent more than $1 million annually on trade fairs, mail shots, telephone marketing and sponsorship. SBM Company maintained a small office in New York. SBM had a valid trade mark registration for ‘Casino de Monte Carlo’ in Monaco.
This case arose out of the use of the name ‘Casino de Monte Carlo’ on numerous websites in the USA. SBM applied to the World Intellectual Property Organisation (WIPO) to resolve ownership of the domain names and a WIPO panel ruled in favour of SBM. To prevent the loss of the domain names in dispute the Appellant then filed an action in the US courts claiming that the SBM trade mark had not been used ‘in commerce’ in the USA. The District Court found in favour of SBM and that SBM did sell services in the US. The Appellant appealed this decision to the Appeal Court. The Appeal Court upheld this decision but on different grounds concluding that it was not necessary for the services to be provided in the USA provided that services were advertised in the US and provided to US citizens, even if those services are provided outside of the US.
There was a strong dissenting judgement in this case arguing that the provision of services outside of the USA by a foreign entity could not constitute use of the mark in the US. It should also be noted that less than one month after this decision a different panel of the same Court Inc -v- Excelentisimo Ayuntamiento de Barcelona (Court of Appeal, Fourth Circuit, June 02 2003) held that trade mark law was based on the ‘fundamental doctrine of territoriality’ and that United States courts ‘do not entertain actions’ seeking to enforce trade marks protected only under foreign law. But of course it can be argued in International Bancorp that the ‘Casino de Monte Carlo’ trade mark WAS protected by US law through its commercial use in the US.

From: Hale and Dorr Internet Law

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