Property, intangible

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The Court of Appeals Confirms “Registrant” Means What It Says

I’ve already written a couple of times about Federal Treasury Enterprise Sojuzplodoimport v. SPI Spirits Ltd. The plaintiff in the case, FTE, manages the STOLICHNAYA trademark on behalf of the Russian government.

The first time the case went to the Court of Appeals, the appeals court reversed the trial court and held that the incontestability provision of the Lanham Act does not prevent an attack on the validity of an assignment. On remand, the trial court next dismissed the case, holding that FTE did not have standing under § 32 of the Lanham Act (I said previously, and still wonder, why the case didn’t state a claim under § 43(a), but it didn’t). The Second Circuit has now reviewed and affirmed the district court decision.

For standing under § 32, one must be a “registrant,” a term which § 45 tells us encompasses “the legal representatives, predecessors, successors and assigns of such … registrant.” What is somewhat unusual about the posture of the case is this:

FTE acknowledges—as it must—that the Russian Federation is the “true owner” of the Marks. See Am. Compl. ¶ 78, J.A. 270. It contends nonetheless that it falls within the Act’s definition of

FTE made a number of arguments why it should be allowed to bring a claim under § 32. I won’t go over them all, but I think the case is significant for a couple of legal principles.

First, FTE claimed that it was an “assign” of the Russian government. Section 10 of the Lanham Act states that an assignment must be “an instrument in writing duly executed.” There were several documents FTE relied on; one didn’t expressly mention trademarks and another stated only that the Russian government was conveying the right to “use and dispose” of the mark, without mentioning assignment, transfer of ownership, or conveyance of the goodwill. The court concluded that the documents defining the relationship between FTE and the Russian government “do not resemble an assignment under United States law, even taking them flexibly and as a cumulative whole.” Therefore, the mark* had not been assigned.

I don’t recall any other case where a court examined the formalities of trademark assignment and concluded that there was no assignment because the writing requirement wasn’t met. The writing requirement is generally not even mentioned—often, as here, there are writings, but the writing (like a lease) doesn’t expressly mention the trademark; nevertheless, a court will conclude there was an assignment. There are also many cases finding that a trademark was assigned when there was no writing at all. Here, the court  relied on the Restatement of Contracts, copyright law and Trademark Office rules in its analysis, suggesting to me that this is indeed a pioneer legal analysis.

The second interesting part of the decision is FTE’s argument that it was a “legal representative” of the Russian Federation and therefore had standing. This was question of first impression at the court of appeals level. The district court held that for one to be a “legal representative,” the representative has to have legal authority from the registrant and the registrant must be unable to appear itself. FTE argued that the district court applied too narrow a rule by requiring the incapacity of the registrant, but in a thorough analysis the Court of Appeals agreed with the district court.

Federal Treasury Enterprise Sojuzplodoimport v. SPI Spirits Ltd., No. 11-4109-CV (2d Cir. Aug. 5, 2013).

*I still haven’t figured out what registration FTE or the Russian Federation claim to be registrant of.

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