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Belmora LLC has petitioned for writ of certiorari to the Supreme Court for a second time in a decades-long trademark dispute between Bayer Consumer Care AG (Bayer) and Belmora over their use of the FLANAX mark for over-the-counter pain relievers sold in Mexico and the United States. Should the Supreme Court grant Belmora’s petition, it would resolve the current circuit splits on the issues of (i) whether the owner of a foreign trademark can purse claims under the Lanham Act §§ 43(a) & 14(3); and (ii) what governs the timeliness of § 43(a) claims.
Bayer is a Swiss corporation whose Mexican affiliate has sold pain relievers under the FLANAX mark in Latin America since the 1970s. Belmora, is a small Virginia-based pharmaceutical company. Bayer’s Mexican FLANAX is a top-selling over-the-counter pain reliever in Mexico known to consumers in the US who are from or spend time in Latin America. Bayer registered the mark in Mexico but does not own an American registration for this mark and does not sell FLANAX to American consumers. Instead, Bayer’s sister company Bayer Healthcare LLC sells pain relievers in the United States under the ALEVE name.
With this gap in the market and capitalizing on an economic opportunity, Belmora began selling pain relievers under the FLANAX name to American consumers in 2004 after it petitioned the United States Patent and Trademark Office (PTO) on October 6, 2003 to register the FLANAX mark. The PTO issued registration of the mark on February 1, 2005 despite Bayer filing a competing application on February 24, 2004, which it cancelled. Because Belmora’s marketing of FLANAX targeted Hispanic-American consumers, associated the product with Bayer’s Mexican FLANAX, and used similar packaging as Bayer’s FLANAX, Bayer petitioned the Trademark Trial and Appeal Board (“TTAB”) to cancel Belmora’s registration as it violated § 43(a) of the Lanham Act in 2007. After nearly seven years, on April 17, 2014, the TTAB granted Bayer’s petition based upon evidence which “readily established blatant misuse of the FLANAX mark by Belmora in a manner calculated to trade in the US on the reputation and goodwill of Bayer’s mark created by its use in Mexico.” Since Belmora’s registration was cancelled by the TTAB, civil litigation ensued and continues today.
In its August 9, 2021 Petition, Belmora is seeking review of two Fourth Circuit decisions and resolution of two specific issues: (1) Whether, in view of the principle of trademark territoriality, the zone of interests encompassed by Lanham Act extends to the foreign owner of a foreign trademark that has not registered or used the mark in the U.S.; and (2) Whether, in the absence of an express limitations period on the Lanham Act, the timeliness of a § 43(a) suit for false association and false advertising is governed by the most analogous state-law statute of limitations, or instead, by laches.
The first issue was dealt with in Belmora LLC v. Bayer Consumer Care AG, 819 F.3d 697 (4th Cir. 2016), holding foreign trademark owners who have not used its trademark in the U.S. may pursue false-association, false-advertising, and trademark-cancellation claims under the Lanham Act against the owner of the same mark in the United States. Specifically, the Fourth Circuit held (i) a US trademark was not a prerequisite for Bayer’s unfair competition claim under the Lanham Act; (ii) Bayer’s claims fell within the Lanham Act’s “zones of interests” because it adequately alleged an injury to a commercial interest in reputation or sales arising from Belmora’s false association claims; and (iii) Bayer’s injuries (customers buying FLANAX in the US instead of Mexico) were proximately caused by the false association. Belmora contends this decision is in contravention of the fundamental trademark principle of territoriality which limits intellectual property rights to the country where they have been registered.
The second issue relating to timeliness stems from the Fourth Circuit’s most recent opinion in Belmora LLC v. Bayer Consumer Care AG, 987 F.3d 284 (4th Cir. 2021). Here, the Fourth Circuit reversed the district court’s ruling that Bayer’s § 43(a) claims against Belmora were time-barred by nearly a decade under an analogous state statute of limitations, and ruled the equitable doctrine of laches, rather than a borrowed state of limitations, governs timeliness of this purely federal question. The Lanham Act does not contain an express limitation period for § 43(a) claims. The Fourth Circuit’s decision to apply the equitable doctrine of laches in lieu of adopting an analogous state law statute of limitations was based upon the Lanham Act, which provides § 43(a) claims for damages are subject to principles of equity and courts may grant injunctive relief to remedy § 43(a) violations according to the principles of equity. This principle is also emphasized by other circuits applying a laches defense to § 43(a) claims.
Bayer’s Response to Belmora’s Petition is due October 12, 2021.