The following post was originally published to Seyfarth’s Gadgets, Gigabytes & Goodwill blog.
The U.S. Supreme Court’s end-of-term decision in Abitron v. Hetronic seems to have created more questions than answers about U.S. brand owners’ ability to leverage the federal Lanham Act in global trademark disputes. In the few weeks since the Court issued its opinion, parties and courts alike are already struggling with exactly how to apply it.
Tenth Circuit Prompts Question As to Statute’s Reach
The Hetronic case originated in the Tenth Circuit. Oklahoma-based Hetronic, a manufacturer of remote controls for construction equipment, sued its former EU distributor for infringing trademarks and trade dress associated with authentic Hetronic products. A jury awarded Hetronic more than $115 million in damages, $96 million of which related to Lanham Act violations. The district court then granted Hetronic a worldwide injunction against defendant Abitron. Abitron appealed, arguing that the award was improper because 97 percent of the sales at issue occurred abroad. The Tenth Circuit tailored the injunction to apply only to markets where Hetronic was actually selling products, but upheld the damage award, reasoning that even activity occurring abroad had a “substantial effect” on U.S. commerce.