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LODESTAR ANSTALT V. BACARDI & COMPANY LTD.

The panel affirmed the district court’s summary judgment in favor of Bacardi U.S.A., Inc., and two of its affiliates in a trademark infringement action brought by Lodestar Anstalt.

The Madrid Protocol, as implemented by amendments contained in Title XII of the Lanham Act, provides that applicants with trademark protection in other countries may obtain an “extension of protection” in the United States, generally equivalent to a trademark registration, without first having used the mark in commerce in the United States. Instead, an extension of protection may be granted under Title XII based on the applicant’s declaration of a bona fide intent to use its foreign-registered mark in the United States.

In 2011, Lodestar obtained an extension of protection for its Liechtenstein-registered trademark in the use of the word “Untamed” in connection with whiskey, rum, and other distilled spirits. After Bacardi began an advertising campaign in November 2013 using the phrase “Bacardi Untameable” to promote its rum products, Lodestar filed suit for trademark infringement and unfair competition.

The panel concluded that, even assuming that Lodestar’s first use of its mark in United States commerce occurred after Bacardi’s campaign began, under the distinctive regime established for the Madrid Protocol, Lodestar’s subsequent bona fide use of its registered mark on certain rum products gave rise to a priority of right that it could seek to enforce under the Lanham Act. Finding useful precedent and commentary addressing a similar issue under the comparable provision of § 44 of the Lanham Act, which addresses registration of foreign marks under the provisions of any applicable “convention or treaty relating to trademarks,” the panel concluded that, under the Madrid Protocol, as under § 44, a foreign applicant who obtains a registration without showing actual use in the United States has a right of priority, as of the relevant “constructive use” date, over another company who first uses the mark in the United States. And once that registrant begins actually using the mark in the United States (and does so even after the competing user has begun using the mark) the registrant may bring an infringement action (subject to any applicable defense) based on that superior right of priority.

Nonetheless, Lodestar failed to satisfy the basic elements of an action for trademark infringement because it failed to show that Bacardi’s campaign involved a likelihood of confusion with Lodestar’s bona fide use of its registered mark in commerce. Lodestar claimed “reverse confusion,” in which a person who knows only of a well-known junior user comes into contact with a lesser-known senior user, and because of the similarity of the marks, mistakenly thinks that the senior user is the same as or is affiliated with the junior user.

The panel concluded that, in deciding which of Lodestar’s products should be considered, the district court erred in applying a categorical temporal rule excluding any consideration of a senior user’s post-infringement use of the mark on additional products. Nonetheless, the panel agreed that Lodestar’s Untamed Revolutionary Rum product should be excluded from the likelihood-of-confusion analysis because it did not reflect a bona fide use of the mark. A reasonable jury, however, could find that Lodestar’s use of the Untamed Work Mark on the back of its bottles of The Wild Geese Soldiers & Heroes rums constituted bona fide use in commerce.

Applying the Sleekcraft factors, the panel concluded that Lodestar failed to carry its burden to show a likelihood of confusion. The panel concluded that the district court erred in certain respects in its consideration of the strength of the mark and Bacardi’s intent, but those errors did not alter the ultimate conclusion that no reasonable jury could find a likelihood of confusion.

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