Behind the Steele Curtain: An Empirical Study of Trademark Conflicts Law, 1952–2016

Tim W. Dornis · 20 Vand. J. Ent. & Tech. 567

Abstract

The law on international trademark disputes is founded on precedent from 1952. Steele v. Bulova Watch Co. is the first and only Supreme Court decision addressing the question of how far the Lanham Act should be extended beyond the United States’ national borders when international infringement is at issue. The decision laid the foundation for a three-pronged test that focuses on the factors of defendant nationality, effects on US commerce, and conflicts with foreign law. Although international trademark conflicts have multiplied dramatically—particularly throughout the last decade—there has been no systematic and comprehensive account of the actual state of the law. Courts and commentators continue to rely only on a small set of leading cases—Steele and a handful of appellate court opinions—when testing the territorial scope of the Lanham Act, thus ignoring the landscape of lower courts’ decision-making. To address this blind spot, an empirical study of the field’s case law from its inception in 1952 until 2016 was undertaken. The results, presented in this Article, reveal that much of the conventional wisdom regarding the state of judge-made law in trademark conflicts cases is questionable, if not incorrect. This Article not only provides new and unexpected insights into the actual extension of US trademark law beyond national territory but also explains which factors drive the outcome of extraterritoriality testing in practice, how these factors interact with one another, and how each factor has been shaped over time. Based on these findings, this Article suggests several corrections to existing doctrine. More succinctly put, in the interest of aligning judicial practice with the realities of socioeconomic globalization, the current overextension of the Lanham Act must be curbed. The doctrine of trademark extraterritoriality that has evolved in the wake of Steele is an anticompetitive detriment rather than a rights holder panacea.