Opinion ID: 182337
Heading Depth: 2
Heading Rank: 2

Heading: Scope of Use Permitted Under the Licensing Agreement

Text: UHS contends that Masters presented no evidence that it exceeded the scope of the license agreement and therefore failed to establish liability under the Lanham Act. It reads the licensing agreement to encompass only the service of treating sexual dysfunction and asserts that Masters never established that UHS's use of the mark while rendering this service breached the terms of the agreement. According to UHS, any other use of the mark, including its presence in advertising materials and promotions for UHS seminars, does not constitute use in commerce under the Lanham Act and is therefore an improper evidentiary basis for imposing liability. Section 43(a) of the Lanham Act imposes liability on [a]ny person who . . . uses in commerce any word, term, name, symbol, or device, or any combination thereof. . . which . . . is likely to cause confusion. . . as to the origin, sponsorship, or approval of goods, services, or commercial activities. 15 U.S.C. § 1125(a)(1)(A). UHS contends that the only service it provided in association with the mark was treatment of sexual trauma, which it had a right to do under the license agreement. Because UHS complied with the agreement, the argument goes, Masters cannot prove that its use was likely to cause confusion and UHS is not liable for infringement of the mark. The unspoken assumption that drives UHS's theory is that the mark was used in commerce when UHS provided treatment to patients, but not when it appeared in promotional materials of its treatment programs. This assumption is unsustainable in view of Section 45 of the Lanham Act, which defines when a servicemark is being use[d] in commerce. Section 45 provides: The term use in commerce means the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark. For purposes of this Chapter, a mark shall be deemed to be in use in commerce . . . on services when it is used or displayed in the sale or advertising of services and the services are rendered in commerce. . . . 15 U.S.C. § 1127(2) (emphasis added). Under this definition, the MASTERS AND JOHNSON mark was used in commerce when it appeared in promotional materials designed to market UHS treatment programs. It also was used in commerce during workshops and seminars when UHS pitched its treatment programs to physicians and other health professionals to facilitate more patient referrals. Masters provided the jury with evidence that UHS used the mark in association with treatment programs unrelated to sexual trauma and treatment methods unrelated to the established MASTERS AND JOHNSON methodology that the mark represents. The jury found that by doing so, UHS willfully breached the agreement, a finding that is supported by the evidence. Because UHS misreads relevant provisions of the Lanham Act and ignores evidence the jury found credible, we reject the analytic premises it provides and the conclusions it derives therefrom.