How Far Can You Reach? The Territorial Limits of Lanham Act Infringement and False Designation of Origin Claims

Though the decision does not address and will not limit a trademark owner's ability to establish, for registration purposes, use in commerce through sales extending into foreign countries, it does limit a trademark owner's ability to enforce its rights in U.S. courts should a third party infringe its marks abroad. Given the global nature of business today, the decision highlights the need for trademark owners to continually reassess and, perhaps, expand their international trademark registration strategy as product lines and brands become more international in scope.

Background

Hetronic manufactures radio remote controls for construction equipment that incorporate a distinctive black and yellow color scheme, and which have been distributed in more than 45 countries around the world. Abitron (which includes five foreign entities — Abitron Germany GmbH, Abitron Austria GmbH, Hetronic Germany GmbH, Hydronic-Steuersysteme GmbH, and ABI Holding GmbH — and one foreign individual) had originally operated as Hetronic's licensed distributor. However, Abitron later claimed ownership of Hetronic's intellectual property rights, including the marks forming the basis of Hetronic's claims. Abitron reverse-engineered Hetronic's products and began selling Hetronic-branded products primarily in Europe (with some direct sales into the United States).