Abitron Austria GmbH v. Hetronic International, Inc./Opinion of Justice Jackson
SUPREME COURT OF THE UNITED STATES
No. 21–1043
ABITRON AUSTRIA GMBH, ET AL., PETITIONERS v. HETRONIC INTERNATIONAL, INC.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT
[June 29, 2023]
Justice Jackson, concurring.
I agree with the Court that 15 U. S. C. §1114(1)(a) and §1125(a)(1) do not apply extraterritorially. Ante, at 7. I also agree that the “ ‘use in commerce’ of a trademark” that both statutory sections describe “provides the dividing line between foreign and domestic applications” of these provisions. Ante, at 14. The Court has no need to elaborate today upon what it means to “use [a trademark] in commerce,” §1127, nor need it discuss how that meaning guides the permissible-domestic-application question in a particular case. I write separately to address those points.
It is clear beyond cavil that what makes a trademark a trademark under the Lanham Act is its source-identifying function. See Jack Daniel’s Properties, Inc. v. VIP Products LLC, 599 U. S. ___, ___ (2023) (slip op., at 3); Qualitex Co. v. Jacobson Products Co., 514 U. S. 159, 162–163 (1995). That is, under the Act, a trademark is “any word, name, symbol, or device, or any combination thereof,” that “a person” “use[s]” or “inten[ds] to use” “to identify and distinguish his or her goods … from those manufactured or sold by others and to indicate the source of the goods.” §1127; see also Qualitex Co., 514 U. S., at 162–163 (emphasizing centrality of this source-identifying function). Sections 1114(1)(a) and 1125(a)(1) permit a mark owner to sue someone who is “us[ing that] mark in commerce” in a way “ ‘likely to cause confusion, or to cause mistake, or to deceive.’ ” B&B Hardware, Inc. v. Hargis Industries, Inc., 575 U. S. 138, 144 (2015).
Critically, the Act defines “ ‘use in commerce’ ” as “the bona fide use of a mark in the ordinary course of trade.” §1127. And, in light of the core source-identifying function of marks, Congress’s statutory scheme embodies a distinction between trademark uses (use of a symbol or equivalent “ ‘to identify or brand [a defendant’s] goods or services’ ”) and “ ‘non-trademark uses’ ” (use of a symbol—even the same one—“in a ‘non-source-identifying way’ ”). Jack Daniel’s, 599 U. S., at ___ (slip op., at 13). This all points to something key about what it means to use a trademark in the sense Congress prohibited—i.e., in a way likely to commit the “cardinal sin” of “confus[ing] consumers about source.” Id., at ___ (slip op., at 14).
Simply put, a “use in commerce” does not cease at the place the mark is first affixed, or where the item to which it is affixed is first sold. Rather, it can occur wherever the mark serves its source-identifying function. So, even after a trademark begins to be “use[d] in commerce” (say, when goods on which it is placed are sold), that trademark is also “use[d] in commerce” wherever and whenever those goods are in commerce, because as long as they are, the trademark “identif[ies] and distinguish[es] … the source of the goods.” §1127. Such a use is not free-floating; the trademark is being used by the “person” who put that trademark on the goods “to identify and distinguish” them in commerce and “indicate the[ir] source.” Ibid. This is the “use in commerce” to which §1114(1)(a) and §1125(a)(1) refer.
Because it is “use in commerce”—as Congress has defined it—that “provides the dividing line between foreign and domestic applications of” these provisions, ante, at 14, the permissible-domestic-application inquiry ought to be straightforward. If a marked good is in domestic commerce, and the mark is serving a source-identifying function in the way Congress described, §1114(1)(a) and §1125(a)(1) may reach the “person,” §1127, who is “us[ing that m]ark as a trademark,” Jack Daniel’s, 599 U. S., at ___ (slip op., at 14). But if the mark is not serving that function in domestic commerce, then the conduct Congress cared about is not occurring domestically, and these provisions’ purely domestic sweep cannot touch that person.
Consider an example. Imagine that a German company begins making and selling handbags in Germany marked “Coache” (the owner’s family name). Next, imagine that American students buy the bags while on spring break overseas, and upon their return home employ those bags to carry personal items. Imagine finally that a representative of Coach (the United States company) sees the students with the bags and persuades Coach to sue the German company for Lanham Act infringement, fearing that the “Coache” mark will cause consumer confusion. Absent additional facts, such a claim seeks an impermissibly extraterritorial application of the Act. The mark affixed to the students’ bags is not being “use[d] in commerce” domestically as the Act understands that phrase: to serve a source-identifying function “in the ordinary course of trade,” §1127.
Now change the facts in just one respect: The American students tire of the bags six weeks after returning home, and resell them in this country, confusing consumers and damaging Coach’s brand. Now, the marked bags are in domestic commerce; the marks that the German company affixed to them overseas continue “to identify and distinguish” the goods from others in the (now domestic) marketplace and to “indicate the source of the goods.” Ibid. So the German company continues to “use [the mark] in commerce” within the meaning of the Act, thus triggering potential liability under §1114(1)(a) and §1125(a)(1). This result makes eminent sense given the source-identifying function of a trademark.[1]
In brief, once the marks on its bags are serving their core source-identifying function in commerce in the United States, this German company is doing—domestically—exactly what Congress sought to proscribe. Accordingly, the German company may be subject to liability for this domestic conduct—i.e., it cannot successfully obtain dismissal of the lawsuit on extraterritoriality grounds—even though it never sold the bags in, or directly into, the United States.[2]
Guided by this understanding of “use in commerce,” I join the Court’s opinion in full.
- ↑ Trademarks facilitate the accumulation of business goodwill whenever and wherever marked goods are in commerce. The manufacturer of source-marked goods reaps a goodwill benefit to the extent that consumers like its product, see Two Pesos, Inc. v. Taco Cabana, Inc., 505 U. S. 763, 774 (1992), and that benefit runs to the manufacturer whenever a trademark is serving a source-identifying function with respect to items in commerce—however that commercial status came to be.
- ↑ I will not attempt to discuss every way in which a marked item might be “in commerce” such that the trademark is being used “in the ordinary course of trade” domestically. §1127. But, in the internet age, one could imagine a mark serving its critical source-identifying function in domestic commerce even absent the domestic physical presence of the items whose source it identifies. See, e.g., 5 J. McCarthy, Trademarks and Unfair Competition §29:56 (5th ed. Supp. 2023) (“The use of an infringing mark as part of an Internet site available for use in the United States may constitute an infringement of the mark in the United States”); 4 id., §25:54.50 (“When an alleged infringing mark is used on the internet, the use is clearly a ‘use in commerce’ ”); 1 id., §3:7 (discussing “evidence of use as a trademark” where “a designation is prominently displayed in a way easily recognized by web users as an indicator of origin”; accord, In re Sones, 590 F. 3d 1282, 1288 (CA Fed. 2009) (observing, with respect to the use-in-commerce requirement, that a “ ‘website [can be] an electronic retail store, and the web page [can be] a shelf-talker or banner which encourages the consumer to buy the product’ ”).