QUERIES:
(i)
What
are “have made” rights under United States Law?
(ii)
What
is the definition of term “use” as per the New York State Trademark Law? Does
it include right to get the goods manufactured from a third party by a licensee
or it only means use of trademark by the licensee for the purpose of sale and
marketing of the Products?
LEGAL PROVISIONS
General Business Laws Article 24-
Trade Marks, Service Marks And Business Reputation
(a) The term "trademark" as used herein means any word, name,
symbol, or device or any combination thereof used by a person to identify and
distinguish the goods of such person, including a unique product, from those
manufactured and sold by others, and to indicate the source of the goods, even
if that source is unknown.
(h) The term "use" 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 the purposes of this article, a mark
shall be deemed to be in use
(1) on goods when it is placed in any
manner on the goods or other 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 the goods are sold or transported in commerce in this state, and
(2) on services when it is used or
displayed in the sale or advertising of services and the services are rendered
in this state.
360-k. Infringement. Subject to the provisions of this
section, any person who shall: (a) use, without the consent of the registrant,
any reproduction, counterfeit, copy, or colorable imitation of a mark
registered under this article in connection with the sale, distribution,
offering for sale, or advertising of any goods or services on or in connection
with which such use is likely to cause confusion or mistake or to deceive as to
the source of origin of such goods or services; or (b) reproduce, counterfeit,
copy or colorably imitate any such mark and apply such reproduction,
counterfeit, copy or colorable imitation to labels, signs, prints, packages,
wrappers, receptacles, or advertisements intended to be used upon or in
connection with the sale or other distribution in this state of such goods or
services; shall be liable in a civil action by the registrant for any and all
of the remedies provided in section three hundred sixty-l of this article,
except that under this subdivision the registrant shall not be entitled to recover
profits or damages unless the acts have been committed with the intent to cause
confusion or mistake or to deceive.
§ 360-m. Remedies.
Any owner of a mark registered under this article may proceed by suit to
enjoin the manufacture, use, display or sale of any counterfeits or imitations
thereof and any court of competent jurisdiction may grant injunctions to
restrain such manufacture, use, display or sale as may be by the said court
deemed just and reasonable, and may require the defendants to pay to such owner
all profits derived from and/or all damages suffered by reason of such wrongful
manufacture, use, display or sale; and such court may also order that any such
counterfeits or imitations in the possession or under the control of any
defendant in such case be delivered to an officer of the court, or to the
complainant, to be destroyed. The court, in its discretion, may enter judgment
for an amount not to exceed three times such profits and damages and/or
reasonable attorneys' fees of the prevailing party in such cases where the
court finds the other party committed such wrongful acts with knowledge or in
bad faith or otherwise as according to the circumstances of this case. The
enumeration of any right or remedy herein shall not affect a registrant's right
to prosecute under the penal law.
The United States Court of Appeals
for the Federal Circuit in the matter of Corebrace
LLC vs. Star Seismic LLC on May 22, 2009, while determining the licensee’s
rights in a license to make, use and sell the patented product, held that the
licensee’s right to make, use and sell the patented product inherently includes
the right to get it made by a third party, absent a clear indication of intent
to the contrary. The court held that a license to produce, use and sell “is
not restricted to production by the licensee personally or use by him
personally or sales by him personally. It permits him to employ others to
assist him in the production, and in the use and in the sale of invention. Nor
need he take any personal part in the production”.
However, the court has made it clear
that in the event, terms of the license clearly articulate the exclusion of
“have made” rights, then the license to make, use and sell the patented product
is restricted and a licensee cannot get it made by a third party.
APPLICATION OF THIS JUDGEMENT TO THE NEW YORK TRADEMARK LAW IS NOT
APPOSITE.
As per the definition clause, the
term "trademark" means any
word, name, symbol, or device or any combination thereof used by a person to identify and
distinguish the goods of such person, including a unique
product, from those manufactured and
sold by others, and to indicate the source of the goods, even if that
source is unknown.
It is clear that a trade mark is a
mark used by a person to identify and distinguish the goods of ‘such person’. ‘Such
person’ here means the owner of the goods. In other words, a trademark can be
used only for identifying and distinguishing the goods manufactured by the
owner or its licensee and not the goods manufactured by a third party.
As per article 24, General Business
Article, the term “use” means the bonafide use of a mark in the ordinary course
of trade.
Section 360K on infringement provides
that any person who shall use without the consent of the registrant,
any reproduction, counterfeit, copy or colourable imitation of a mark
registered under this article in
connection with the sale, distribution, offering for sale, or advertising of
any goods or services on or in connection with which such use is likely to cause
confusion or mistake or to deceive as to
the source of origin of such goods or services shall be liable for a civil
action.
It is submitted that the definition
of infringement can be divided into following essential parts:
Any person
(i)
Use
without the consent of registrant a mark
(ii)
in
connection with sale, distribution, offering for sale or advertising of any goods
(iii)
such
use is likely to cause confusion or mistake or deceive
(iv)
as
to the source of origin of such goods or services.
is liable for
civil action.
Though the condition no. (ii) talks
of offering for sale or advertising of ‘any’ goods, however, the condition no.
(iv) restrict the definition of goods to the “source of origin” of such goods,
meaning thereby that a licensee with the consent of the registrant can sell the
goods with the mark subject to the satisfaction of the fourth condition i.e.
the use should not be in a manner so as to deceive or confuse or mistake about
the source of origin. In other words “source of origin” here when read in
conjunction with definition of trademark means the “owner”.
Therefore, if a licensee uses a
trademark on the goods manufactured by the third party, there is bound to be
confusion and deceive amongst the consumers about the source of origin, such
confusion can be a result of performance or change in color of the Product.
Moreover, selling of a product manufactured by a third party with the trade
mark of the Licensor itself amount to deceiving and passing off.
Attention is also invited to the
language used in section 360-m, Remedies, which provides that any owner of a mark registered under
this article may proceed by suit to enjoin
the manufacture, use, display or
sale of any counterfeits or imitations thereof and any court of competent jurisdiction may grant injunctions to restrain
such manufacture, use, display or
sale as may be by the said court deemed just and reasonable, and may require the defendants to pay to
such owner all profits derived from
and/or all damages suffered by
reason of such wrongful manufacture, use,
display or sale; and such court may also order that any such counterfeits or
imitations in the possession or under the control of any defendant in such case
be delivered to an officer of the court, or to the complainant, to be
destroyed.
It is clear from this clause that
manufacture and use have different connotation and “use” does not inherently
include manufacturing or producing itself or by third parties.
A combined reading definition, infringement
and remedies clause makes it crystal clear that under the Trademark law license
to “use” the trademark does not include manufacturing of product from a third
party.
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