25 March 2016
U.S. Appeals Court Rejects Narrowed Definition of “Trademark” for Origin Marking Purposes
The U.S. Court of Appeals for the Federal Circuit has overturned a U.S. Court of International Trade decision and held that certain imported goods do not have to comply with a more stringent country of origin marking requirement even though marks they bear with a geographic reference were not registered trademarks at the time of importation.
19 CFR 134.46 states that when words, letters or names referring to a geographical location (e.g., “United States” or “American”) appear on an imported article or its container and may mislead the consumer as to the actual country of origin the article must also be marked with its country of origin in a manner that is legible and permanent, in close proximity to the location words, letters or names, and in at least a comparable size. 19 CFR 134.47, on the other hand, states that when such location words, letters or names are part of a trademark or trade name, the country of origin marking must be legible and permanent, conspicuous, and either in close proximity to the location words, letters or names or in some other conspicuous location.
This case involves imported jeans that had (i) embroidered markings specifying the brand name alongside a geographical reference such as “Los Angeles” or “USA” and (ii) labels not in close proximity to those markings indicating in smaller font that the jeans were made in mainland China. CBP determined that these jeans were subject to the stricter origin marking requirements in 134.46 based on its interpretation of “trademark” for purposes of 134.47 as being limited to either registered trademarks or marks subject to a pending application. Noting that this term is not defined in the pertinent regulations, the CIT held that it must give substantial deference to CBP’s interpretation on the grounds that it was consistent with the regulation and its stated purpose.
The CAFC, however, stated that the CIT’s deference was in error because the term “trademark” in 134.47 unambiguously includes both federally registered and common law trademarks. Trademark rights stem from use, not registration, the court said, and there is nothing in the record indicating that the plain meaning of this term is limited to registered trademarks and trademarks with pending applications. In fact, other regulations in 19 CFR show that when CBP intended to limit a regulation to registered trademarks it expressly did so.
The CAFC therefore remanded this case back to the CIT for proceedings consistent with this opinion, noting that the CBP has previously determined that the “made in China” labels on the jeans satisfy the requirements of 134.47.