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As a matter of first impression, the Ninth Circuit Court of Appeals recently held that in court proceedings affecting a mark that is the subject of a U.S. trademark application or registration, a foreign-domiciled applicant or registrant can be served through the domestic agent designated by it in the United States Patent and Trademark Office (“Trademark Office”) during prosecution and that, if there is no such agent, such applicant or registrant can be served through the Director of the Trademark Office. See San Antonio Winery, Inc. v. Jiaxing Micarose Trade Co., 53 F.4th 1136, 1138 (9th Cir. 2022).
The Lanham Act allows trademark applicants domiciled in foreign countries to designate “a person resident in the United States on whom may be served notices or process in proceedings affecting the mark.” 15 U.S.C. § 1051(e) [emphasis added]. If a foreign-domiciled applicant does not designate such a person, the Lanham Act states that such notices or process can be served on the Director of the Trademark Office. Id. Such service may be accomplished by leaving the documents with or mailing the documents to the designated person or, if there is none, the Director. Id.
Numerous U.S. district courts across the country have considered whether “proceedings affecting the mark” is limited proceedings in the Trademark Office or whether it also includes court proceedings and have reached conflicting results; the results have been fairly evenly split.[1] The Ninth Circuit is the first appellate court to consider the issue. The Ninth Circuit found, unambiguously, that court proceedings affective a mark, the Lanham Act allows for service on a foreign applicants’ or registrants’ designated domestic representatives or, if there is none, on the Director of the Trademark Office. While only binding on district courts within the Ninth Circuit (Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Utah, and Washington), the decision is likely to be persuasive nationwide.
The practical implications for foreign entities are significant. Where Lanham Act service is not an option, serving a foreign defendant in a U.S. lawsuit is often a complicated and costly proposition. Lanham Act service, now Ninth Circuit-approved, however, allows a plaintiff to accomplish service simply by mailing a summons and complaint to a defendant’s designated agent or, if there is none, the Director of the Trademark Office. Lanham Act service does not necessarily satisfy service requirements of foreign nations. As a result, a plaintiff may have difficulty enforcing a judgment obtained in a lawsuit served in this manner in a foreign country. Where a foreign defendant has significant assets in the U.S., however, enforcement abroad may not be necessary to satisfy a judgment. Additionally, Lanham Act service does not suffice to establish personal jurisdiction over the foreign defendant served; the plaintiff would still be required to show the foreign defendant had sufficient connections to the U.S. to justify jurisdiction. Notably, a number of cases have found that the filing of a U.S. trademark application is a sufficient basis for exercising jurisdiction over the applicant in the U.S.
At a minimum, existing foreign applicants and registrants should confirm that they have designated reliable domestic representatives and should also ensure that their contact information, as well as that of their representatives, on file with the Trademark Office remains current. Additionally, foreign entities considering filing U.S. trademark applications should be aware that filing such applications subjects them to service in U.S. lawsuits affecting the applied-for mark. We are of course available to help with the analysis and defense strategy with any foreign defendants who have been sued in the U.S.
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[1] Compare Outboard Marine Corp. v. Chantiers Beneteau, 687 F. Supp. 366, 368 (N.D. Ill. 1988) (disallowing service pursuant to Section 1051(e) in a civil action); Sunshine Distribution, Inc. v. Sports Auth. Michigan, Inc., 157 F. Supp. 2d 779, 787 (E.D. Mich. 2001) (same); E. & J. Gallo Winery v. Cantine Rallo, S.p.A., 430 F. Supp. 2d 1064, 1072-83 (E.D. Cal. 2005) (same); LA Gem & Jewelry Design, Inc. v. Gold Star Jewellery PVT Ltd., No. CV 14-4807 DSF (RZX), 2014 WL 10401936, at *3 (C.D. Cal. Aug. 11, 2014) (same); Vantone Grp. Ltd. Liab. Co . v. Yangpu Ngt Indus. Co., No. 13CV7639-LTS-FM, 2016 WL 3926449, at *3 (S.D.N.Y. July 15, 2016) (same) with V & S Vin & Sprit Aktiebolag v. Cracovia Brands, Inc., 212 F. Supp. 2d 852, 854-55 (N.D. Ill. 2002) (allowing service pursuant to Section 1051(e) in a civil action); Haemoscope Corp. v. Pentapharm AG, No. 02 C 4261, 2002 WL 31749195, at *3 (N.D. Ill. Dec. 9, 2002) (same); Night Owl SP, LLC v. Dongguan Auhua Elecs. Co., No. 2:19-CV-109 FTM 38 UAM, 2019 WL 5084162, at *2-*3 (M.D. Fla. Mar. 15, 2019) (same).
Notably, at least two district courts have analyzed both the relevant statutory language and legislative history and have, nonetheless, reached different conclusions about the reach of this provision. Compare E. & J. Gallo Winery v. Cantine Rallo, S.p.A., 430 F. Supp. 2d 1064, 1072-83 (E.D. Cal. 2005) (finding “proceedings affecting the mark” ambiguous and exploring legislative history of Section 1051 and, thereafter, finding that “proceedings” do not include civil actions) with V & S Vin & Sprit Aktiebolag v. Cracovia Brands, Inc., 212 F. Supp. 2d 852, 854-55 (N.D. Ill. 2002) (finding “proceedings affecting the mark” ambiguous because it was included in provision of Lanham Act dealing with registration rather than civil actions, examining legislative history, and finding that “proceedings” include civil actions).
JMBM’s Intellectual Property Group represents entrepreneurs, family-owned businesses, middle-market companies, startups, universities and the FORTUNE 500, handling patents, trademarks, copyrights, domain names, trade dress, trade secrets, and related licensing and litigation. Our approach is aggressive and efficient, and we keep a keen focus on helping clients achieve their goals.
This update is provided to our clients, business associates and friends for informational purposes only. Legal advice should be based on your specific situation and provided by a qualified attorney.
