© 2003, Dawsey Co., LPA
November 2003

The United States Court of Appeals for the Fourth Circuit, in a recent trademark case, has clarified that the use of a trademark “in commerce,” need not necessarily represent sales made, or services rendered, within the United States. In International Bancorp LLC v. Societe des Bains de Mer, the owners of the famous casino at Monte Carlo alleged that even though their services were obviously offered only outside the United States, the fact that they advertised within the United States, in part by making access to their internet web site available to Americans, brought them under the “in commerce” definition of the Lanham Act. The casino owners sought to protect their registration of 43 domain names, all of which incorporated some portion of the term “Casino de Monte Carlo.”

At the trial level, the district court made a summary finding of infringement. International Bancorp appealed, arguing that the casino owners did not use their domain names in commerce in the United States. The Fourth Circuit agreed with the casino. Holding that the term “commerce,” under the Lanham Act extended to all commerce that the U.S. Congress may regulate under the Commerce Clause of the U.S. Constitution, the court concluded that all varieties of interstate commerce, as well as commerce between the U.S. and foreign countries, are at least potentially subject to congressional regulation.

The court noted that while advertising must be rendered in conjunction with actual services, in order to pass muster as a “use in commerce,” the advertising and the services need not both be rendered in the United States. Accordingly, advertising within the United States of services that are available only outside of the United States satisfies the requirements of the Lanham Act, because the services are available to U.S. citizens, even though they may have to travel outside the U.S. to take advantage of them. Such a combination of domestic advertising and a foreign service constitutes foreign trade “with” the United States, and since such foreign trade may be regulated by Commerce, it falls under the trademark rules of the Lanham Act. One judge dissented, asserting that both parts of the contested action, advertising and services, need to be performed in the United States. The court, however, held that there was no such merger required under the Lanham Act, and that as long as there was domestic advertising supported by actual foreign services, it did not matter if there was a difference in the locale of each.