STOLICHNAYA: In Soviet Russia, Mark Trades You.

mdbheadshotfinalI’ve long suspected that certain products–vice products, as it were–are disproportionately often involved in trademark disputes, but I’m too lazy to do actual research to confirm my suspicion. In any event, this dispute involves vodka, and–unless I’m very much mistaken–the decision is going to restart the Cold War. — MDB

bottle.stolichnaya-premium-vodkaI’m not a vodka drinker. I prefer gin. Still, I think Russia’s getting the short end of the swizzle stick in Fed. Treasury Enter. v. SPI Spirits Ltd., in which a decision of the United States Court of Appeals for the Second Circuit came down on August 5. (That is… August Fifth. Fifth! Get it?)

The plaintiffs-appellants are a Russian Federation-chartered entity (known in the matter as “FTE”) and its exclusive licensee (“Cristall”). The defendants are eleven related entities, real persons and corporations, who also claim rights to the vodka trademark at issue: “STOLICHNAYA,” which can be translated from Russian as “from the capital.” The mark has been registered with the USPTO since 1969.

The dispute is uncomplicated, even if the background might be: Because Russian law prohibits governmental bodies from conducting business activities, the Russian Federation (a governmental agency, and the one that owns the STOLICHNAYA mark), through its Ministry of Agriculture and Ministry of Property Relations formed FTE and charged it with exploiting the STOLICHNAYA trademarks on behalf of the Russian Federation. Over time, in a series of decrees, the Russian Federation endowed FTE with various rights; one gives FTE the right to prosecute suits in foreign courts.

It seems clear to this reader that the Russian Federation wants FTE to be able to handle all of its vodka-trademark-related business. The government of Russia, one presumes, has other things to worry about. Not that vodka isn’t very important… but you know what I mean.

The United States District Court for the Southern District of New York, however, didn’t think so, and now the Second Circuit has affirmed the dismissal of FTE’s claims for lack of standing to sue. Despite what (I expect) most people would find to be sufficient and satisfactory evidence of the Russian Federation’s desire and intent to have FTE sue in the United States to protect the STOLICHNAYA mark, the U.S. courts have concluded that FTE has not alleged facts sufficient to support a finding that it is either the “assign” or the “legal representative” of the Russian Federation or that the Russian Federation has “ratified” the lawsuit. Read More…

STOLICHNAYA trademark: There’s good news and bad news.

The statutory copyright damages awards merry-go-round Thomas-Rasset circus is not the only case that seems to be stuck in an infinitely-recurring loop.  As Pamela Chestek explains, “the STOLICHNAYA case [has] end[ed] again.”

All together now!

All together now!

The bad news is it’s not so clear just what kind of mash the Southern District of New York has distilled here, according to Pamela:

I am utterly confused by this decision. First, I don’t understand why the court entertained a § 32 argument any further than [plaintiff] “FTE isn’t a registrant.” I couldn’t find any application or registration owned by FTE or Russia, so I’m not sure why, even assuming FTE was the Russian Federation’s agent or assignee, either would have had standing as “registrant” under § 32.

Second, why is there no argument under § 43(a)?  As explained in this post, one doesn’t have to be a trademark owner to bring a claim under § 43(a), just “likely to be damaged.”  But there was no § 43(a) count.  Perhaps it was because FTE isn’t actually selling anything in the U.S., so FTE had no claim that SPI’s use was likely to cause confusion with FTE’s (non-existent) use.

Finally, is this a Lanham Act case at all? There’s no mention of how SPI came to own the trademark registrations for STOLICHNAYA in the decision, but the Third Amended Complaint tells quite a story about what the plaintiff claims is the theft of the mark in Russia and efforts to recapture it.  Is this really a claim for fraud, to void a contract, or for enforcement of a Russian or Dutch judgment, rather than for trademark infringement?

SovietznakSo many questions!

In Communist Paradise, we just lifted our glasses and drank, nyet?  Show trials are so much more convenient, and no questions afterward!  In contrast, trademark things like recent EU decision on hammer and sickle trademark merely make a comrade miss mandatory reeducation …