WASHINGTON (November 11, 2005) – In a closely watched trademark case concerning parallel imports (often referred to as "gray market" goods), the United States Court of Appeals for the Federal Circuit recently affirmed a decision by the International Trade Commission that Sutherland Asbill & Brennan LLP client Bearings Limited and the three other respondents at trial did not infringe SKF USA's registered and common law trademarks by importing and selling SKF bearings and, therefore, had not violated Section 337 of the Tariff Act of 1930. SKF USA, Inc. v. International Trade Commission (Fed. Cir. Sept. 14, 2005).
Initiated in 2002, SKF USA, a subsidiary of Swedish-based AB SKF, filed a complaint to stop Bearings Limited and 13 other respondents from importing into the United States SKF bearings made by SKF affiliates in other countries. Four of the respondents defaulted, and six settled before trial. Bearings Limited led the four remaining respondents at the initial three-and-a-half week trial and again at a one week trial on remand. The ITC ruled for the four litigating respondents in May, 2004. In The Matter of Certain Bearings and Packaging Thereof, Inv. No. 337-TA-469.
The Complainant appealed the ITC decision to the Federal Circuit Court of Appeals and on September 14, 2005, the Federal Circuit affirmed the ITC's determination that SKF USA did not establish a material difference between its own products and those of the respondents. The Federal Circuit's opinion makes it clear that gray market importation does not infringe on a trademark owner's rights unless the imported goods are "materially different" than "all or substantially all" of the trademark owner's authorized products. The Federal Circuit also clarified the nature of the differences that might be material, unequivocally indicating that the differences at issue can be physical or non-physical, but must relate to some characteristic that "predictably and consistently" accompanies "all or substantially all" non-gray market goods sold in the United States.
Throughout the ITC proceeding and appeal, Bearings Limited was represented by a cross-office multidisciplinary team led by Sutherland partners Steuart Thomsen and Patricia Cunningham, and also including associates Candice Decaire, Greg Kaufman, Rene LaForte, Kathleen Devereaux and John Anderson. Sutherland partners Mark Herlach and Libby Langworthy also represented Bearings Limited in the ITC proceedings. Bearings Limited's general counsel, Greebel and Greebel, of Mineola, NY, assisted throughout the ITC proceeding and appeal.
Bearings Limited, founded in 1947, has eight locations around the U.S. and is headquartered in Hauppauge, NY. The company prides itself on providing competitively priced high quality bearings and strong customer service to bearing and power transmission distributors.
Sutherland Asbill & Brennan LLP is a national law firm known for solving challenging business problems and resolving unique legal issues for many of the nation's largest companies. Founded in 1924, the firm has grown to more than 425 lawyers with offices in Atlanta, Austin, Houston, New York, Tallahassee and Washington. For further information about the firm, please visit sutherland.com.