Opinion ID: 151187
Heading Depth: 2
Heading Rank: 1

Heading: Whether the SensoryFlavors Name Was Used in Commerce

Text: First, the parties dispute whether section 45 of the Lanham Act applies to infringement cases. The Lanham Act imposes civil liability on any person who ... without the consent of the registrant ... use[s] in commerce any reproduction ... or colorable imitation of a registered mark. 15 U.S.C. § 1114(1)(a) (emphasis added). Section 43(a) of the Act also imposes liability for [a]ny person who, on or in connection with any goods or services, or any container for goods, 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) (emphasis added). Under section 45 of the Lanham Act, use in commerce is defined as follows: 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 (1) on goods when (A) it is placed in any manner on the goods or their containers or the displays associated therewith or on the tags or labels affixed thereto, or if the nature of the goods makes such placement impracticable, then on documents associated with the goods or their sale, and (B) the goods are sold or transported in commerce, and (2) on services when it is used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services. 15 U.S.C. § 1127. In its brief, Sensient argues the press release, announcement, and two presentations provided by SensoryFlavors, in addition to its website, were sufficient to establish a question of fact regarding use in commerce of the mark under section 45. At oral argument, however, Sensient contradicted its argument by asserting for the first time that section 45 does not apply in infringement cases, and rather is limited in its application to the registration of trademarks. Sensient bases its contention largely on dicta provided by the Second Circuit Court of Appeals in Rescuecom Corp. v. Google, Inc., 562 F.3d 123, 128-29 (2d Cir.2009), which involved an infringement dispute over search terms used by a popular Internet search engine. Rescuecom held Google's display, offer, and sale of the plaintiff's mark to advertising customers was sufficiently alleged as use in commerce to avoid dismissal under Rule 12(b)(6) of the Federal Rules of Civil Procedure. 562 F.3d at 130-31. After reaching its conclusion, the Rescuecom court attached a lengthy appendix analyzing whether section 45 applies in the infringement context. The court first noted the statute begins with a guarded and tentative limitation that the definitions provided under the statute apply unless the contrary is plainly apparent from the context. Id. at 132 (quoting 15 U.S.C. § 1127). The court then analyzed the 1988 amendment to the statute providing that use in commerce means the bona fide use of a mark in the ordinary course of trade. Id. at 132-33. According to the court, the amendment made clear that section 45's definition of use in commerce applies only to the registration of marks, not to infringement cases, because it is inconceivable that the statute could have intended to exempt infringers from liability because they acted in bad faith. Id. The court believed this reading of the statute was confirmed by a Congressional report accompanying the 1988 amendment, which explained that the revised use in commerce definition is intended to apply to all aspects of the trademark registration process, and that clearly, however, use of any type will continue to be considered in an infringement action. Id. at 138 (citing S. Rep. 100-515 100th Cong. at 45, 1988 U.S.C.C.A.N. 5577, 5607-08 (1988)) (internal quotation marks omitted). Pursuant to the amended statutory language, Rescuecom envisioned two possible interpretations of section 45 in infringement cases. The first interpretation bars application of the entire definition of use in commerce in the infringement context as a result of the new language in the first sentence relating to bona fide use, as discussed above. Id. at 140. The second, and preferable interpretation would continue to apply the remainder of the use in commerce definition relating to goods and services in infringement cases, and simply disregard the bona fide use language in such cases, which would be reserved for application only in the registration context. [2] Id. Ultimately, the court noted its discussion was dicta that did not affect the result in the case, and it urged Congress to further clarify the statute. Id. at 140-41. In this case, we express no view as to whether section 45's use in commerce definition continues to properly apply in infringement cases. Compare 4 McCarthy on Trademarks and Unfair Competition § 23:11.50 (4th ed.) (The Lanham Act § 45 narrowing definition of what constitutes `use in commerce' is just a relaxed remnant of trademark law's once-hyper-technical `affixation' requirement. This statutory anachronism certainly was never intended to limit the scope of `uses' that would constitute infringement) with Margreth Barrett, Trademarks and Digital Technologies: Use on the Net, 13 No. 11 J. Internet L. 1, 9 (2010) ([T]he Lanham Act's legislative history makes it clear that Congress intended this statutory definition [of section 45] to apply in the infringement context and to carry forward the 1905/1920 Acts' general `affixation or other close association' requirement.'). Although Sensient cites the Rescuecom case in its opening brief, it confines its argument to whether SensoryFlavors' limited uses of the mark meet the definition of use in commerce under section 45. Prior to oral argument, Sensient failed to develop any argument that section 45 did not apply to an infringement case such as the instant matter. See Cubillos v. Holder, 565 F.3d 1054, 1058 n. 7 (8th Cir.2009) (citation omitted) (deeming an argument waived where the petitioner referenced an argument in his opening brief, but failed to develop the argument). To the contrary, Sensient explicitly concedes in its reply brief that the statute applies to infringement cases. See Appellant's Reply Brief at 1 (The parties agree that the Lanham Act requires that a trademark be used in commerce before a finding of infringement can be made.). Under these circumstances, we assume without holding that section 45 applies to infringement cases and we will proceed to determine whether SensoryFlavors' use of its mark meets the definition of use in commerce. See Flowers v. Norris, 585 F.3d 413, 416 n. 2 (8th Cir.2009) (limiting review under a statute based on petitioner's concessions in his reply brief). Applying the language of the statute, SensoryFlavors' goods must have been sold or transported in commerce, among other requirements. 15 U.S.C. § 1127. As noted above, Sensient attempts to satisfy this requirement by pointing to SensoryFlavors' efforts to advertise and market its goods through two customer presentations, a press release, an announcement, and a website. Sensient's argument conflates the distinction between goods and services provided under section 45. Rescuecom and the other cases Sensient relies upon involved an alleged infringer's services, not goods, and therefore the courts applied the separate definition provided above for determining whether the services were used in commerce. Rescuecom, 562 F.3d at 129 (According to the Complaint, Google uses and sells Rescuecom's mark `in the sale of Google's advertising services rendered in commerce.') (emphasis added). Even in cases applying the services definition, many courts have held mere advertising is not enough to constitute use in commerce because a mark is used in commerce only if it accompanies services rendered in commerce. Int'l Bancorp, LLC v. Societe des Bains de Mer et du Cercle des Estrangers a Monaco, 329 F.3d 359, 364 (4th Cir.2003). Sensient fails to show evidence of any sale or transport of any goods bearing the SensoryFlavors mark. While Sensient suggests Nicolais did not know for certain that no sales resulted from the two presentations, this assertion is weak at best because the two companies which received the presentations did not become customers of SensoryEffects subsequent to the name change. Binkley v. Entergy Operations, Inc., 602 F.3d 928, 931 (8th Cir.2010) (In order to survive a motion for summary judgment, the non-moving party must be able to show sufficient probative evidence that would permit a finding in his favor on more than mere speculation, conjecture, or fantasy) (citation omitted). Because there is no evidence demonstrating any sale or transport of goods under the SensoryFlavors name, Sensient fails to establish a triable issue of fact as to whether the goods were used in commerce, and we affirm the district court's grant of summary judgment on the SensoryFlavors mark.