987 F.3d 284
4th Cir.2021Background
- Bayer (Swiss) owned the FLANAX trademark and a Mexican registration; BHC (U.S. affiliate) sold ALEVE in the U.S.; Bayer did not sell FLANAX in the U.S. but the mark was well known to U.S. consumers with Mexico experience.
- Belmora began selling naproxen sodium in the U.S. under the FLANAX name in 2004, used packaging and marketing referencing Bayer’s Mexican FLANAX, and obtained U.S. registration in 2005.
- Bayer filed a TTAB cancellation petition in 2007; after nearly seven years the TTAB canceled Belmora’s registration in April 2014 for misrepresenting source and trading on Bayer’s goodwill.
- Bayer sued Belmora in June 2014 under § 43(a) (false association and false advertising) and related California-law claims; the district court applied a borrowed state statute of limitations and held the federal claims time-barred.
- The Fourth Circuit held laches (an equitable defense) is the proper timeliness rule for § 43(a) claims, vacated the dismissal of those claims, remanded for laches analysis, and also vacated the dismissal of state-law claims for the district court to determine tolling; it affirmed judgment for Bayer on Belmora’s counterclaims and affirmed the TTAB cancellation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 43(a) claims are governed by a borrowed state statute of limitations or by laches | Bayer: § 43(a) lacks an express limitations period; laches (equitable) is the proper timeliness rule | Belmora: courts should borrow the most analogous state statute of limitations to bar the claim | Laches governs § 43(a) claims; district court erred in applying a state statute of limitations; remanded for laches analysis |
| Whether Bayer’s related California claims were tolled by filing the TTAB cancellation petition (or otherwise) | Bayer: filing the TTAB petition and equitable tolling should pause state limitations | Belmora: claims are time-barred under applicable state law | District court failed to consider tolling; vacated dismissal of state-law claims and remanded for factual findings on tolling |
| Whether Belmora’s counterclaims (secondary infringement/importation) had evidence of Bayer’s inducement or willful blindness | Belmora: Bayer knowingly enabled or willfully ignored gray-market imports and thus is secondarily liable | Bayer: no evidence linking Bayer to importation, inducement, or willful blindness | Affirmed for Bayer—Belmora produced no evidence of inducement, assistance, or willful blindness; summary judgment for Bayer affirmed |
| Proper standard of review for a § 1071(b) challenge to TTAB when new evidence is submitted | Belmora: district court must review the entire record de novo when new evidence is submitted | Bayer: district court may affirm on substantial-evidence grounds if new evidence is not material | Affirmed TTAB cancellation; district court need only conduct de novo review when new evidence raises disputed factual questions and here the court found the new evidence non-credible or irrelevant |
Key Cases Cited
- DelCostello v. Int’l Bhd. of Teamsters, 462 U.S. 151 (federal claims typically borrow state limitations unless federal timeliness rules like laches are more appropriate)
- Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23 (§ 43(a) reaches beyond registration-based trademark protection)
- Jarrow Formulas, Inc. v. Nutrition Now, Inc., 304 F.3d 829 (9th Cir. 2002) (applying laches to § 43(a) and explaining equitable character)
- PBM Prods., LLC v. Mead Johnson & Co., 639 F.3d 111 (4th Cir. 2011) (discussing laches in Lanham Act context)
- What-A-Burger of Va., Inc. v. Whataburger, Inc. of Corpus Christi, Tx., 357 F.3d 441 (4th Cir. 2004) (recognizing Lanham Act claims are governed by laches principles)
- Van Dusen v. Barrack, 376 U.S. 612 (choice-of-law principles for § 1404(a) transfers)
- Ferens v. John Deere Co., 494 U.S. 516 (transfers should not change applicable law in diversity cases)
- Swatch AG v. Beehive Wholesale, LLC, 739 F.3d 150 (4th Cir. 2014) (district court’s duty in § 1071(b) actions to review de novo and admit new evidence)
- Kappos v. Hyatt, 566 U.S. 431 (de novo review required when district court considers different evidence than the PTO)
- Inwood Labs., Inc. v. Ives Labs., Inc., 456 U.S. 844 (secondary liability standard for trademark infringement)
- Eastman Kodak Co. v. Image Tech. Servs., Inc., 504 U.S. 451 (standard for monopolization under § 2 of Sherman Act)
- Ray Commc’ns, Inc. v. Clear Channel Commc’ns, Inc., 673 F.3d 294 (4th Cir. 2012) (factors for laches analysis in Lanham Act cases)