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INTRODUCTION

 As these modern and historical statements suggest, it’s an axiomatic principle of domestic and international trademark law that trademarks and trademark law are territorial. Yet recently some scholars have suggested that “the territorial model of trademark law is an anachronism” within the global market. I suggest that statements about trademark territoriality, though largely unquestioned, mask a spread of related propositions. Territorial philosophies separately affect rules regarding the scope of rights, applicable legal norms, and therefore the acquisition and enforcement of rights. Disaggregating the “principle of territoriality” into its parts, and separately analyzing the doctrines that implement the principle, enables a more nuanced assessment of the ways during which the principle could be modified in an era of worldwide trade. especially, it becomes apparent that different rules of trademark law possess a territorial character for various reasons. for instance, common law trademark rights are territorial because the intrinsic purpose of trademark law suggests extending (and limiting) rights to the geographic reach of goodwill. In contrast, registration systems designed to market economic expansion derive their territorial character from their grounding in economic policymaking, effected by institutions that specialise in the regulation or development of discrete economic regions. And rules regarding the enforcement of trademark rights assume their territorial quality due to their connection to political institutions with territorially defined sovereignty. Thus, some aspects of territoriality are rooted in social and commercial practices that dictate the reach of a brand, while other aspects are a function of political or policymaking authority. In an era of worldwide trade and data communication, social and commercial practices are less territorially confined and fewer commensurate with the nation-state. But economic policymaking and political institutions may prove more immune to change than social or commercial behavior.

I argue that although the principle of trademark territoriality has nominally remained constant since the conclusion of the Paris Convention over 100 years ago, recent developments at both the national and international level suggest that the principle may have a special intensity today. Some U.S. courts appear willing to switch traditional principles and doctrines to reflect the increasingly cross-border nature of goodwill. the foremost notable judicial revisions have involved the “use in commerce” prerequisite to the award of U.S. rights, the well-known mark doctrine that protects foreign brands, and therefore the conditions under which courts will grant relief with extraterritorial effects. The courts in question have acted, sometimes explicitly, largely to avoid domestic consumer confusion that might not be likely to occur absent all of the signature features of worldwide life—increased international travel, satellite and Internet communication, and global trade—although one decision does reflect a priority for shielding foreign producers’ ability to expand into us.

Internationally, instruments are adopted to guard producer interests in expanding trade by facilitating the grant of trademark protection on a broader territorial basis (with or without registration) and to attenuate the prices of international trade by harmonizing substantive trademark norms. But truly international norms are directly applicable only within the field of cybersquatting disputes, and efforts to deviate from national models of enforcement have likewise taken root only therein narrow context. An investigation of the ways during which the principle of territoriality should be revisited in light of the globalization of markets and concomitant changes in modern marketing practices. Given the multidimensional nature of the territoriality principle, different territoriality-based rules could be more or less appropriate subjects for reform. Thus, some overarching reconfiguration of “the principle” would be unwise and maybe impossible. Instead, the paper analyzes several discrete developments. This analysis encompasses both revisions to the territorial model that have recently occurred (such as liberalization of the power to get U.S. rights without use within us and enlargement of international mechanisms to get registrations on a multinational basis) and proposals for reform that are being resisted (such as efforts to facilitate the consolidation of multinational trademark claims during a single proceeding)

THE PRINCIPLE OF TERRITORIALITY

Trademark law is territorial partially because the foundational property conventions of the late nineteenth century, the Paris Convention and therefore the Berne Convention for the Protection of Literary and Artistic Property, were built round the principle of national treatment. As a general rule, a signatory state was obliged to supply protection to nationals of other signatory states that matched the protection afforded its own nationals. And this principle, carried forward and consolidated within the TRIPS Agreement, is seen as a corollary to the principle of territoriality—in a world of various trademark laws, lines are drawn consistent with place and not citizenship.

But trademark law isn’t unique in its territorial character and may need to be assumed this character absent international conventions. Much law is territorial. this is often true for several reasons, reasons that have consumed international lawyers and legal theorists for hundreds of years. Historically, the principal divide was between laws that attached to the person, wherever that person traveled, and laws that regulated consistent with the place where a relevant legal event occurred. Scholars of personal law of nations have for several years offered a spread of theories advocating one approach over the opposite and over time have developed rules that allocate some legal inquiries to the law of the person et al. to the law of the place. Trademark law is firmly within the latter category. The attractions of territoriality are clear. Law is contextual, and geography is a crucial part of the context. Territorial regulation of conduct comports in some sense with intuitive notions of appropriate prescriptive authority, embodied within the aphorism “when in Rome, do because the Romans do.” And territorial regulation may additionally be supported for practical or pragmatic reasons like the relative simple enforcing domestic judgments and comity-grounded concerns of reciprocal overreaching.

Without rehearsing more fully the claims of territoriality as a governing principle of the reach of the law, it’s clear that courts and students justifying the territoriality of trademark law have resorted to a number of equivalent arguments that are advanced in other fields of law. As I will be able to explain in greater detail below, however, there are additional reasons that specify the territorial character of trademark law. Some are due to the intrinsic nature and purpose of trademarks; others reflect the form of economic policymaking, and yet others reflect the structure of political institutions wont to administer and enforce trademark law. For present purposes, it’s sufficient to notice that it’s in some sense hardly radical to seek out that trademark law is territorial.

The concluding parts highlight the extent to which, in implementing an appropriate commitment to the principle of territoriality, there is, or should be, an assimilation of the “territorial” and therefore the “national.” during a world of burgeoning international trademark law, the suggestion that trademark rights are territorial often finds practical expression within the notion that trademark rights are national. Although the 2 are often spoken of interchangeably, identification and analysis of the alternatives facing trademark law could be better achieved by consciously separating the especially, recognition of the territoriality of goodwill is linked to the essential purposes of trademark law, namely, the preservation of that goodwill and therefore the protection of consumers. Nationality-grounded doctrines, seen particularly within the context of acquisition and enforcement of rights, are more likely driven by policy and by institutional issues like the sensible demands of current political structures. Recognizing this distinction would assist in highlighting for policymakers that doctrines reflecting premises connected to the national nature of institutions are likely to stay relatively fixed and can within the short term be substantially resistant to the revolution we are witnessing in social norms. This grounding in nationality makes these doctrines more stable and fewer amenable to reform and emphasizes that, with reference to these doctrines, we’ll first need to modify political structures—whether judicial or administrative—if reform is to be imagined.

THE RECENT EVOLUTION OF THE PRINCIPLE OF TERRITORIALITY

 to know fully the extent to which the principle has been modified, it’s important to research separately different aspects of trademark law that are territorially based.

Territoriality of Rights: the need of “Use”

 With reference to the territoriality of rights, the strength and effect of the principle of territoriality are determined by the overall rules concerning what amounts to “use” of a mark—both use sufficient to accumulate any rights and use relevant to the geographic scope of these rights—and by exceptions to the utilization requirement. the overall rule appears nominally unchanged as of late; use remains a prerequisite to the creation and therefore the scope of rights. Indeed, whilst commerce becomes more global, courts continue to interact in micro-analysis of local markets to work out the reach of the goodwill embodied by a mark. But there are changes in both what constitutes “use in commerce” sufficient to accumulate and define rights and therefore the breadth of the exceptions under which rights are going to be recognized absent use, particularly under the well-known mark doctrine.

The Lanham Act requires the use of a mark “in commerce” so as to accumulate U.S. trademark rights, whether to get a federal registration or to say a claim based upon unregistered rights under 43(a). The use of a mark during a foreign country creates no rights within the U.S.

Resting on the principles espoused in United Drug, which reserve U.S. rights to those companies whose actual “trade goes attended by the utilization of its mark,” courts have consistently held that the mere advertising or promotion of a mark within the U.S. is insufficient to constitute “use” of the mark “in commerce,” within the meaning of the Lanham Act, where that advertising or promotion is unaccompanied by any actual rendering within the U.S. or in “commerce which can lawfully be regulated by Congress,” . . . of the services “in reference to which the mark is used .” Moreover, courts took the position that “use of a far off trademark in reference to goods and services sold only during a foreign country by a far off entity doesn’t constitute ‘use of the mark’ in us commerce sufficient to merit protection under the Lanham Act.” it had been of no moment that American consumers had availed themselves of the services or goods sold by the foreign user, or that Americans had inquired about the possible expansion of the business into the U.S. . Nor did it matter that the advertising was targeted at American consumers, or whether the advertising occurred within or without U.S. borders. As far back as 1983, the Trademark Trial and appeals board warned that the other rule would have enormous consequences, in terms of uncertainty, on our trademark system. Considering the rapid technological advances in telecommunications, especially satellite communications, . . . if mere use of a mark in restaurant services advertising created rights within the U.S., without a filing somewhere on a Register capable of being searched, the adoption of a restaurant mark within the U.S. would be extremely hazardous. The rule that only use within the U.S. could produce U.S. trademark rights was especially significant in priority contests. It meant that a U.S. producer could adopt a mark within the U.S. knowing that the mark had previously been employed by another producer abroad. In Person’s Co. v. Christman, Christman, on a visit to Japan, saw luggage sold under the mark PERSON’S. Upon returning to America and confirming by a trademark search that the mark was still available within the U.S., Christman adopted the mark and obtained a federal registration. during a contest with the Japanese producer, who wished to expand into the U.S. market, Christman prevailed because he was the primary user of the mark within the United States. The U.S. Court of Appeals for the Federal Circuit rejected the argument of the Japanese company that in light of the “world economy,” priority of rights should be determined by first use anywhere, even use outside the United States. Thus territoriality, as implemented by national laws and giving rise to national rights, remained the governing principle, even in a global economy.

The Federal Circuit did note two circumstances in which the prior foreign user might prevail notwithstanding that it was not the first user in the United States: “(1) [when] the foreign mark is famous here or (2) [when] the use is a nominal one made solely to block the prior foreign user’s planned expansion into the United States.” Either circumstance might suggest the bad faith necessary to deprive the U.S. applicant of U.S. rights, but mere knowledge of a foreign use was not by itself sufficient to sustain that conclusion. In contrast, in the domestic context, some courts have held that mere knowledge of the mark destroyed the good faith necessary to sustain junior users’ rights under United Drug.

The “famous mark” doctrine, to which the Person’s court referred, had been acknowledged in several earlier decisions, although it had rarely been applied to award rights to a foreign user. The doctrine implements U.S. obligations which require member states, ex officio if their legislation so permits, or at the request of an interested party, to refuse or to cancel the registration, and to prohibit the use, of a trademark which constitutes a reproduction, an imitation, or a translation, liable to create confusion, of a mark considered by the competent authority of the country of registration or use to be well known in that country as being already the mark of a person entitled to the benefits of this Convention and used for identical or similar goods.

TERRITORIALITY AND NATIONALITY

The appropriateness of the leading developments may turn on whether one seeks to effectuate the intrinsic consumer protection purposes of trademark law or (additionally) to develop trademark law instrumentally as a tool of economic policy to equip domestic producers to compete in global markets. A subsidiary theme, however, in that and other debates, is the relationship between territoriality and nationality.

U.S. courts have consistently recognized that the rules applicable to two remote users within the United States are different from those that govern the competing rights of a senior user outside the United States and a later user who is the first to use within the United States. Because rights in the United States cannot be acquired by use outside the United States, the later user within the United States will—as the only user in the United States—be afforded substantial latitude before it risks losing a priority contest with the foreign user. Thus, the later U.S. user starts as the senior user and the presumptive rights holder, subject to narrow exceptions, whereas the later user in an internal U.S. dispute will only have rights if the later user satisfies strict requirements of good faith, remoteness, and use before federal registration.

This distinction can be explained on several different grounds, and the explanation chosen may affect whether one accepts the need to revise trademark law in light of globalization (or the possibility of doing so). Nationality might be regarded as a good proxy for territoriality if markets, and thus consumer understanding, were always national. That is, one might simply treat the international rule as the implementation of an assumption that foreign markets are remote and that the local producer, who would not expect that the foreign producer would expand into the United States, acts in good faith. Conceptualized in these terms, which are grounded very much in universal trademark teleology rather than in notions of political authority or national industrial policy, the advent of globalization and world markets would throw the distinction between the internal and cross-border scenarios into considerable doubt. The stated assumptions hold up in many fewer cases, such that the arguments for a rule of law flowing from them seem weak.

However, global trading may warrant a lesser revision of the different treatment of domestic and international priority contests if we explain that distinction on other grounds. For example, if we posit the distinction between domestic and international priority contests as reflecting the prescriptive reach (normative or descriptive) of the national political authorities that accord trademark rights, the emergence of global markets has little to say about the revision of the “territorial” rules of trademark law absent the creation of global political institutions.

Finally, the distinction may rest instead on the practical concerns of nations that a ready supply of marks be available to their producers and that the cost of clearing marks not become prohibitive because of conflicting international marks. Despite the readier access to information about foreign registers, which might make searching easier, if the distinction were based on this rationale it likewise would not require revision because of international trade. But the distinction, so based, might be more susceptible to change if social developments cause a reassessment of the availability of marks. It would be helpful, however, if courts and scholars would recognize assimilation and its significance. When territorial rules flow from nationally grounded concerns such as economic policy or political sovereignty, they are likely to be subject to a more cautious reassessment. Policymaking and political institutions have retained their national configuration even in the face of globalization. That is to say, the assimilation of territoriality and nationality in debates about the issues discussed in this paper is an unspoken decision to prefer only one aspect of territoriality or to pursue a particular set of trademark objectives (i.e., those that reflect political sovereignty or economic policy).

CONCLUSION

The phenomenon of globalization presents a variety of challenges to U.S. courts and international policymakers. In the face of such challenges, they are arguably reconfiguring the doctrines of territoriality for a new age. But the considerations that lead to one solution over another are often unstated. Mere reference to “the principle of territoriality” in support of a particular position is insufficient because the principle is not unitary. It is simply impossible to say that “the principle” is either outdated or unnecessary to change.

Whether trademark law can be detached from its territorial moorings and the nation-state is not simply a function of whether consumer or producer activity still conforms to the territorial boundaries of the nation-state. That consideration, grounded in social and commercial practices, reflects only that part of the territoriality principle intrinsic to the purposes of trademark law, namely, extending (and limiting) trademark rights to the geographic reach of goodwill. A fuller assessment of the linkage between trademark law and the nation-state requires a broader understanding of why the principle of territoriality dominates trademark law. In particular, complementary objectives of trademark law, such as the promotion of economic expansion and the effective enforcement of rights, have also often been viewed through a territorial lens. But the devices used to pursue these objectives derive their territorial character from their grounding in economic policymaking or political institutions rather than social practices.

Thus, the resilience of the “principle of territoriality” can be properly assessed only by considering both those aspects of trademark law grounded in the intrinsic purposes of trademark law and those that assume their territorial character because of their connection to economic policy or political institutions. In an era of global trade and digital communication, social and commercial practices are less territorially confined and less concordant with the nation-state. But economic policymaking and political institutions may prove more resistant to change than social behavior. Nationally rooted aspects of territoriality, such as enforcement, will make the transition from the nation-state only when the institutional structure allows it. Thus, under the UDRP, effective global relief can be obtained based upon territorial rights. But it is the technological control that ICANN exercises over the domain name system that enables the UDRP to move beyond the national enforcement model. It is one of the rare circumstances in which the policymaking and political structures, which normally sustain national models of enforcement, have evolved from the nation-state in ways that allow a loosening of nationally rooted notions of territoriality. It might also be useful to think explicitly about the role of the nation-state in trademark law, especially in an era in which goodwill is geographically shapeless. It might be tempting to reflect socially driven, nonnational notions of territoriality to vindicate the basic purpose of trademark law, but ultimately the national political authorities will be important for enforcement and will also have a legitimate role to play in interjecting concerns of industrial policy that might temper full commitment to socially constructed territories. Nation-states have not yet found a way, and are not likely soon to find a way, to create the global political institutions that are necessary for the formulation and enforcement of global trademark rights. Instead, the primary value of the state in this context lies in its adjudicatory and enforcement authority. This does not mean that the scope of rights that a state enforces need be coincident with its political authority, although to exceed that authority may create problems of enforcement. But it does mean that, whatever deviation from a political authority in favor of social boundaries might be justified by the intrinsic purpose of trademark law, the continuing role of national authorities requires that attention also be paid to the national political objectives of economic expansion and commercial certainty. This was true in the shift from local to national markets, and it will also be true in a move toward global markets, regardless of the actual boundaries of goodwill.

REFERENCE

1.  https://moam.info/trademarks-and-territory-detaching-trademark-law-from-the-nation-state_598ee90e1723ddcb690d91a1.html

2.  https://www.mondaq.com/india/trademark/704162/universality-and-territoriality-doctrine-with-reference-to-well-known-trademarks

3. https://scholarship.kentlaw.iit.edu/fac_schol/918/