iAddressing standing under § 32(a) of the Lanham Act, the U.S. Court of Appeals for the Second Circuit upheld the dismissal of claims brought by a Russian state-chartered entity to enforce Stoli trademarks. Federal Treasury Enterprise Sojuzplodoimport v. SPI Spirits Ltd., Case No. 11-4109 (2d Cir. Aug. 5, 2013) (Carney, J.)
Plaintiff-appellants Federal Treasury Enterprise Sojuzplodoimport (FTE) and Moscow Distillery Cristall appealed from a judgment dismissing their Lanham Act claims over the U.S.-registered trademarks related to Stolichnaya brand vodka (the Stoli marks) brought against defendants SPI Spirits Limited and other related defendants (collectively, SPI). The Stoli marks were originally registered in the United States in 1969 by a Soviet entity. After an initial failed claim to ownership of the Stoli marks by an SPI-related entity, the Russian Federation eventually became the successor in interest to the Stoli marks. The Russian Federation created FTE through a charter and gave it certain rights through a series of decrees, in part for the purpose of exploiting the Stoli marks and prosecuting suits over the marks in foreign courts.
To have standing to sue under § 32(1) of the Lanham act, a party must be a “registrant,” which includes the registrant’s “legal representatives, predecessors, successors, and assigns.” At the district court, and on appeal, FTE argued unsuccessfully that it was either an “assign” or a “legal representative” of the Stoli marks owner, the Russian Federation.
Looking at the issue of what law to apply, the Second Circuit determined that although Russian law may be relevant to determining the relationship between FTE and the Russian Federation vis-à-vis the Stoli marks, U.S. law must govern whether this relationship is sufficient for standing under the Lanham Act.
The Second Circuit next considered whether FTE was an “assign” authorized to sue under the Lanham Act. To quality as an “assign” there must be an assignment duly executed in writing, and the assignment must transfer ownership interest in the marks at issue. The Second Circuit concluded that FTE’s charter and the various decrees did not sufficiently identify the Stoli marks. The Second Circuit also found that the charter and the decrees left the Russian Federation with too great an operational interest in the Stoli marks to effectuate an assignment. The Second Circuit also rejected FTE’s related argument that even if it is not technically an “assign” of the marks (i.e., under the Lanham Act), its exclusive right to use the marks makes it an “exclusive licensee” and that this status is sufficient to support statutory standing.
The Second Circuit next considered the standard for a “legal representative” under the Lanham Act—a question of first impression in the U.S. courts of appeals. The Second Circuit explained that a “legal representative” under the Lanham Act must have the authority to appear on behalf of the registrant with respect to the registrant’s legal interests, and the legal registrant must be unable or incapable of representing itself and enforcing its own rights. The Second Circuit rejected FTE’s arguments that a registrant need not be unavailable. Finally, the Second Circuit affirmed dismissal of Cristall’s claims, as its interest in the Stoli marks was entirely derivative of FTE’s.
