Domestic---Includes Trademark Enforcement---2AC/1AR

Not specifying in the plan means it’s legally ‘domestic.’ Plus the infringing activity occurred in the United States since products were sold to US residents

Alito ’23 [Samuel; June 29; justice of the US Supreme Court, writing the majority opinion in a 9-0 decision; Abitron Austria GMBH et al. v. Hetronic International, Inc., https://www.supremecourt.gov/opinions/22pdf/21-1043_7648.pdf]

“It is a ‘longstanding principle of American law “that legislation of Congress, unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United States.”’” Morrison v. National Australia Bank Ltd., 561 U. S. 247, 255 (2010). We have repeatedly explained that this principle, which we call the presumption against extraterritoriality, refers to a “presumption against application to conduct in the territory of another sovereign.” Kiobel v. Royal Dutch Petroleum Co., 569 U. S. 108, 119 (2013) (citing Morrison, 561 U. S., at 265). In other words, exclusively “‘[f]oreign conduct is generally the domain of foreign law.’” Microsoft Corp. v. AT&T Corp., 550 U. S. 437, 455 (2007) (alteration omitted). The presumption “serves to avoid the international discord that can result when U. S. law is applied to conduct in foreign countries” and reflects the “‘commonsense notion that Congress generally legislates with domestic concerns in mind.’” RJR Nabisco, Inc. v. European Community, 579 U. S. 325, 335–336 (2016).

Applying the presumption against extraterritoriality involves “a two-step framework.” Id., at 337. At step one, we determine whether a provision is extraterritorial, and that determination turns on whether “Congress has affirmatively and unmistakably instructed that” the provision at issue should “apply to foreign conduct.” Id., at 335, 337; accord, Kiobel, 569 U. S., at 117 (asking whether Congress “intends federal law to apply to conduct occurring abroad”); Nestlé USA, Inc. v. Doe, 593 U. S. ___, ___ (2021) (slip op., at 3). If Congress has provided an unmistakable instruction that the provision is extraterritorial, then claims alleging exclusively foreign conduct may proceed, subject to “the limits Congress has (or has not) imposed on the statute’s foreign application.” RJR Nabisco, 579 U. S., at 337–338.

Step two does not end with identifying statutory focus. We have repeatedly and explicitly held that courts must “identif[y] ‘the statute’s “focus”’ and as[k] whether the conduct relevant to that focus occurred in United States territory.” Id., at ___ (slip op., at 5) (emphasis added); accord, e.g., RJR Nabisco, 579 U. S., at 337. Thus, to prove that a claim involves a domestic application of a statute, “plaintiffs must establish that ‘the conduct relevant to the statute’s focus occurred in the United States.’” Nestlé, 593 U. S., at ___–___ (slip op., at 3–4) (emphasis added); see, e.g., WesternGeco, 585 U. S., at ___–___ (slip op., at 6–8) (holding that a claim was a domestic application of the Patent Act because the infringing acts—the conduct relevant to the focus of the provisions at issue—were committed in the United States); Morrison, 561 U. S., at 266–267, 271–273 (concluding that a claim was a foreign application of the Securities and Exchange Act because the “purchase-and-sale transactions” at issue occurred outside of the United States).

The test is whether a trademark generates US consumer confusion – if an infringing good is advertised in the US, it’s domestic

Ketanji Brown Jackson, 2023 – justice of the US Supreme Court, concurring opinion in a 9-0 decision. ABITRON AUSTRIA GMBH ET AL. v. HETRONIC INTERNATIONAL, INC. 6/29, https://www.supremecourt.gov/opinions/22pdf/21-1043_7648.pdf //DH

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

(footnote 2)

2I 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’ ”).

The harm of infringement occurred to domestic companies – that means the plan’s a domestic protection

LAWRENCE K. NODINE, 2022 – counsel of record for the International Trademark Association. “BRIEF OF THE INTERNATIONAL TRADEMARK ASSOCIATION AS AMICUS CURIAE IN SUPPORT OF NEITHER PARTY” in the case of ABITRON AUSTRIA GMBH, ET AL., Petitioners, v. HETRONIC INTERNATIONAL, INC. Respondent.

https://www.supremecourt.gov/DocketPDF/21/21-1043/250905/20221227154119470_21-1043%20Brief.pdf //DH

Importantly, the Lanham Act’s focus is not limited to point-of-sale consumer confusion. It is broader, and provides remedies against pre-sale and post-sale confusion, injury to reputation, mistaken affiliation or sponsorship, and dilution. If a foreign actor causes substantial injury in the U.S. in these ways, then it would be a permissible domestic application of the Lanham Act to enjoin or provide compensation for these injuries.

Because the harm occurs domestically, the plan’s a domestic application of the Lanham Act

https://www.supremecourt.gov/DocketPDF/21/21-1043/250905/20221227154119470_21-1043%20Brief.pdf //DH

THE LANHAM ACT PASSES THE SECOND STEP OF THE RJR NABISCO TEST BECAUSE PREVENTING FOREIGN CONDUCT THAT CAUSES DOMESTIC CONFUSION OR INJURES DOMESTIC REPUTATION IS A PERMISSIBLE DOMESTIC APPLICATION OF THE LANHAM ACT.

Alternatively, if in deciding step one of the RJR Nabisco test the Court rules that the Lanham Act does not rebut the presumption against extraterritoriality, then it proceeds to step two and asks:

[W]hether the case involves a domestic application of the statute, and we do this by looking to the statute’s “focus.” If the conduct relevant to the statute’s focus occurred in the United States, then the case involves a permissible domestic application even if other conduct occurred abroad; but if the conduct relevant to the focus occurred in a foreign country, then impermissible the case extraterritorial involves an application regardless of any other conduct that occurred in U.S. territory.

RJR Nabisco, 579 U.S. at 337. This rubric raises two component questions: first, what is the relevant conduct, and second, what is the focus of the Lanham Act.

2.1 Because Steele was based on reputational injury in the U.S., it reflects permissible domestic application of the Lanham Act.

Importantly, although Steele is widely cited as supporting “extraterritorial” application of the Lanham Act, the Court relied heavily on the domestic impact of Steele’s foreign conduct. The counterfeit watches filtered back into the U.S., causing injury to Bulova’s reputation in the U.S. Moreover, the Steele Court did not make a broad pronouncement that the Lanham Act has extraterritorial effect in all circumstances. Instead, it held that “[i]n the light of the broad jurisdictional grant in the Lanham Act, we deem its scope to encompass petitioner’s activities here.” Id. at 286. (Emphasis added).

Accordingly, Steele may be interpreted in the light of the RJR Nabisco rubric either as a limited extraterritorial application, or as an example of “permissible domestic application” of the Lanham Act without contradicting Steele’s precise holding. Compare WesternGeco LLC v. ION Geophysical Corp., 138 S. Ct. 2129, 2137-38 (2018) (finding, based on the Patent Act’s focus on domestic conduct of exporting from the U.S. certain non-staple components, that a recovery of profits from the resulting foreign sales was a “permissible domestic application” under RJR Nabisco). The requirement of cases such as Vanity Fair and its variants that the foreign conduct must have a substantial impact on U.S. commerce, see Section 2.4, infra, is sufficient to confine the Lanham Act to “permissible domestic applications,” and thereby allow the Court to preserve seventy years of jurisprudence interpreting Steele.

2.2 Preventing domestic consumer confusion and reputational injury is a “permissible domestic application” of the Lanham Act.

Both the cause and the effect of confusion are “conduct relevant to the focus” of the Lanham Act. RJR Nabisco, 579 U.S. at 337. A statute’s focus “is the object of its solicitude, which can include the conduct it seeks to regulate, as well as the parties and interests it seeks to protect or vindicate.” WesternGeco, 138 S. Ct. at 2137 (internal quotation marks omitted) (quoting Morrison, 561 U.S. at 267) (emphasis added). The “object of the [Lanham Act’s] solicitude” is the prevention of various harmful effects, including consumer confusion and injury to the trademark owner’s goodwill. Therefore the “relevant conduct” within the RJR Nabisco formulation is not only the cause of the injury, but also its effect, i.e., the injury (such as confusion or injury to reputation).3

It follows that if foreign conduct causes an effect within the U.S., “then the case involves a permissible domestic application even if other conduct occurred abroad.” RJR Nabisco, 579 U.S. at 337. However, when foreign conduct causes only foreign injury, e.g., only confusion of foreign consumers, then there is no “relevant conduct” in the U.S. and application of the Lanham Act would be

impermissible.

Consequently, a ruling by this Court that the Lanham Act does not rebut RJR Nabisco’s step one presumption against extraterritoriality would not undermine the vast majority of Lanham Act decisions that grant an extraterritorial remedy where foreign conduct caused substantial trademark injury in the U.S. If a Lanham Act claim is brought to prevent domestic trademark-related injury, then it would be a “permissible domestic application” of the statute. And this would be true even if the Lanham Act does not qualify under step one of the RJR Nabisco test.

The Lanham Act isn’t extraterritorial even though it includes foreign commerce

With this well-established framework in mind, the first question is whether the relevant provisions of the Lanham Act, see §§1114(1)(a), 1125(a)(1), provide “a clear, affirmative indication” that they apply extraterritorially, RJR Nabisco, 579 U. S., at 337.3 They do not.

It is a “rare statute that clearly evidences extraterritorial effect despite lacking an express statement of extraterritoriality.” Id., at 340. Our decision in RJR Nabisco illustrates the clarity required at step one of our framework. There, we held that the Racketeer Influenced and Corrupt Organizations Act could have extraterritorial application in some circumstances because many of its predicate offenses “plainly apply to at least some foreign conduct” and “[a]t least one predicate . . . applies only to conduct occurring outside the United States.” Id., at 338.

Here, neither provision at issue provides an express statement of extraterritorial application or any other clear indication that it is one of the “rare” provisions that nonetheless applies abroad. Both simply prohibit the use “in commerce,” under congressionally prescribed conditions, of protected trademarks when that use “is likely to cause confusion.” §§1114(1)(a), 1125(a)(1).

Hetronic acknowledges that neither provision on its own signals extraterritorial application, but it argues that the requisite indication can be found in the Lanham Act’s definition of “commerce,” which applies to both provisions. Under that definition, “‘commerce’ means all commerce which may lawfully be regulated by Congress.” §1127. Hetronic offers two reasons why this definition is sufficient to rebut the presumption against extraterritoriality. First, it argues that the language naturally leads to this result because Congress can lawfully regulate foreign conduct under the Foreign Commerce Clause. Second, it contends that extraterritoriality is confirmed by the fact that this definition is unique in the U. S. Code and thus differs from what it describes as “boilerplate” definitions of “‘commerce’” in other statutes. Brief for Respondent 23.

Neither reason is sufficient. When applying the presumption, “‘we have repeatedly held that even statutes . . . that expressly refer to “foreign commerce”’” when defining “commerce” are not extraterritorial. Morrison, 561 U. S., at 262–263; see also RJR Nabisco, 579 U. S., at 344. This conclusion dooms Hetronic’s argument. If an express statutory reference to “foreign commerce” is not enough to rebut the presumption, the same must be true of a definition of “commerce” that refers to Congress’s authority to regulate foreign commerce. That result does not change simply because the provision refers to “all” commerce Congress can regulate. See Kiobel, 569 U. S., at 118 (“[I]t is well established that generic terms like ‘any’ or ‘every’ do not rebut the presumption against extraterritoriality”). And the mere fact that the Lanham Act contains a substantively similar definition that departs from the so-called “boilerplate” definitions used in other statutes cannot justify a different conclusion either.

The relevant question to determine ‘domestic’ is whether the use in commerce occurred within the United States

Because §1114(1)(a) and §1125(a)(1) are not extraterritorial, we must consider when claims involve “domestic” applications of these provisions. As discussed above, the proper test requires determining the provision’s focus and then ascertaining whether Hetronic can “establish that ‘the conduct relevant to [that] focus occurred in the United States.’” Nestlé, 593 U. S., at ___–___ (slip op., at 3–4).

Much of the parties’ dispute in this case misses this critical point and centers on the “focus” of the relevant provisions without regard to the “conduct relevant to that focus.” WesternGeco, 585 U. S., at ___ (slip op., at 5). Abitron contends that §1114(1)(a) and §1125(a)(1) focus on preventing infringing use of trademarks, while Hetronic argues that they focus both on protecting the goodwill of mark owners and on preventing consumer confusion. The United States as amicus curiae argues that the provisions focus on only likely consumer confusion.

The parties all seek support for their positions in Steele v. Bulova Watch Co., 344 U. S. 280 (1952), but that decision is of little assistance here. There, we considered a suit alleging that the defendant, through activity in both the United States and Mexico, had violated the Lanham Act by producing and selling watches stamped with a trademark that was protected in the United States. Although we allowed the claim to proceed, our analysis understandably did not follow the two-step framework that we would develop decades later. Our decision was instead narrow and factbound. It rested on the judgment that “the facts in the record . . . when viewed as a whole” were sufficient to rebut the presumption against extraterritoriality. Id., at 285. In reaching this conclusion, we repeatedly emphasized both that the defendant committed “essential steps” in the course of his infringing conduct in the United States and that his conduct was likely to and did cause consumer confusion in the United States.4 Id., at 286–287; accord, e.g., id., at 286 (“His operations and their effects were not confined within the territorial limits of a foreign nation”); id., at 288 (“[P]etitioner by his ‘own deliberate acts, here and elsewhere, brought about forbidden results within the United States’” (alteration omitted)). Because Steele implicated both domestic conduct and a likelihood of domestic confusion, it does not tell us which one determines the domestic applications of §1114(1)(a) and §1125(a)(1).

With Steele put aside, then, we think the parties’ particular debate over the “focus” of §1114(1)(a) and §1125(a)(1) in the abstract does not exhaust the relevant inquiry. The ultimate question regarding permissible domestic application turns on the location of the conduct relevant to the focus. See, e.g., RJR Nabisco, 579 U. S., at 337. And the conduct relevant to any focus the parties have proffered is infringing use in commerce, as the Act defines it.

This conclusion follows from the text and context of §1114(1)(a) and §1125(a)(1). Both provisions prohibit the unauthorized use “in commerce” of a protected trademark when, among other things, that use “is likely to cause confusion.” §§1114(1)(a), 1125(a)(1). In other words, Congress proscribed the use of a mark in commerce under certain conditions. This conduct, to be sure, must create a sufficient risk of confusion, but confusion is not a separate requirement; rather, it is simply a necessary characteristic of an offending use.5 Because Congress has premised liability on a specific action (a particular sort of use in commerce), that specific action would be the conduct relevant to any focus on offer today. See, e.g., WesternGeco, 585 U. S., at ___– ___ (slip op., at 6–8).

In sum, as this case comes to us, “use in commerce” is the conduct relevant to any potential focus of §1114(1)(a) and §1125(a)(1) because Congress deemed a violation of either provision to occur each time a mark is used in commerce in the way Congress described, with no need for any actual confusion. Under step two of our extraterritoriality standard, then, “use in commerce” provides the dividing line between foreign and domestic applications of these Lanham Act provisions.