Opinion ID: 1038552
Heading Depth: 3
Heading Rank: 1

Heading: Dorpan's Rights Under the Lanham Act

Text: Dorpan argues that HMI can have no claim to exclusive use of the Meliá mark in Puerto Rico because Dorpan holds the federal registration for the Meliá mark and that registration has become incontestible within the meaning of the Lanham Act. Incontestibility is a status created by Section 15 of the Lanham Act, which provides that once a mark has been registered and in continuous use for five consecutive years without an adverse ruling against the holder, the registrant may file an affidavit of inconstestibility with the USPTO. See 15 U.S.C. § 1065; see also Borinquen Biscuit Corp. v. M.V. Trading Corp. 443 F.3d 112, 117 n.3 (1st Cir. 2006). Dorpan is correct that incontestibility creates a presumption that the holder of the mark is entitled to exclusive use of the mark throughout the United States. See Thrifty Rent-A-Car Sys., 831 F.2d at 1180 (citing Giant Foods, Inc. v. Nation's Foodservice, Inc., 710 F.2d 1565, 1568 (Fed. Cir. 1983)); see also 15 U.S.C. § 1065. Indeed, a plaintiff who holds an incontestible registered -11- mark is generally entitled to a preliminary injunction enjoining an allegedly infringing party. See Pyrodyne Corp. v. Pyrotronics Corp., 847 F.2d 1398, 1402 (9th Cir. 1988) (cited in Williams v. Jones, 11 F.3d 247, 256 n.13 (1st Cir. 1993)). In this case, however, Dorpan's reliance on the undisputed incontestibility of its marks is misplaced. HMI does not seek to cancel, contest, or otherwise challenge Dorpan's registration. Rather, HMI claims that, as the undisputed senior user in Puerto Rico, the rights granted to Dorpan under federal law are limited by the rights HMI acquired under Puerto Rico law before Dorpan's mark became incontestible. HMI's argument is often called a Section 15 defense. At the same time that Section 15 of the Lanham Act creates incontestibility, it explicitly limits the incontestible right of a federal trademark holder to the extent, if any, to which the use of a mark registered on the principal register infringes a valid right acquired under the law of any State or Territory by use of a mark or trade name continuing from a date prior to the date of registration under this chapter of such registered mark. 15 U.S.C. § 1065; see also Qashat, 364 F.3d at 334 n.4 (noting that the incontestibility of a federally registered mark is limited in situations in which a valid common law owner has established a date of use prior to that of the registered mark). In other words, [t]he territorial rights of a holder of a federally registered trademark are always subject to any superior common law -12- rights acquired by another party through actual use prior to the registrant's constructive use. Allard Enter., Inc. v. Advanced Programming Res., Inc., 249 F.3d 564, 572 (6th Cir. 2001). Because the parties agree that HMI is the senior user of the Meliá mark in Puerto Rico, the rights conveyed to Dorpan under the Lanham Act are limited by the extent of any rights HMI acquired under Puerto Rico law before Dorpan's federal registration became incontestible. Hence, before we can determine the contours of Dorpan's rights under federal law, we must determine the rights held by HMI under Puerto Rico law. See Advance Stores Co. v. Refinishing Specialities, Inc., 188 F.3d 408, 411-12 (6th Cir. 1999) (extent of pre-existing common law trademark is determined by reference to state law).10