Court: Court of Appeals for the Eleventh Circuit; November 24, 1994; Federal Appellate Court
The judgment of the district court, referenced as 828 F.Supp. 944, is affirmed, based on the reasoning provided in the court's Order on Foreign Law Issues and the Amended Memorandum Opinion and Order, included in the appendix as Exhibits A and B. The case involves Babbit Electronics, Inc. and Dynascan Corporation, who entered into an agreement in 1985 allowing Babbit to sell Cobra-branded cordless telephones in Latin America, with Babbit paying royalties to Dynascan. Babbit claims to have paid $2,532,162 for the products and $254,662 in royalties, asserting that Dynascan misled it regarding trademark rights in several South American countries.
The court's hearing, held on April 24, 1992, focused on foreign law issues raised by Babbit, particularly concerning trademark protections in Brazil, Argentina, Venezuela, and Paraguay. Babbit contends that Dynascan's claims of trademark ownership were false, while Dynascan asserts its rights to oppose registrations of similar marks based on its use of the Cobra trademark.
The court limited its findings to the four countries where Babbit sold its products and sought to clarify the applicable trademark laws. Expert testimony was provided by Professor Keith Rosenn for Babbit and Jeremiah D. McAuliffe for Dynascan. The court's findings align mainly with Rosenn's testimony.
Specifically regarding Brazil, the court noted that trademark rights are secured through registration rather than use, as governed by the Industrial Property Code (Law No. 5.772 of December 21, 1971). Article 2 of the CPI indicates that intellectual property rights protection is achieved through registration.
Registration of a trademark in Brazil guarantees the registrant ownership and exclusive use of the mark to distinguish their products or services. The trademark must be registered and actively used in Brazil to maintain protection, with an initial validity of ten years, extendable for additional ten-year periods. If the mark is not used for two years after registration or if its use is interrupted for two consecutive years, it lapses. The owner is required to use the trademark as specified in the registration certificate.
Foreign trademarks are recognized if filed in accordance with treaties ensuring reciprocity with Brazil, requiring registration within 120 days of filing in Brazil. Foreign applicants must appoint a local representative with power of attorney within 60 days of filing. Licensing of trademarks necessitates a registered agreement with the INPI for legal remittance of foreign currency and tax deductions. Historically, the maximum royalty for trademark licensing was set at one percent of net sales for the first ten years of registration.
Use of an unregistered mark by a third party without a recorded license does not benefit the trademark owner. Payments for foreign trademarks cannot occur unless registration is filed within the priority period. Licensing of Brazilian trademarks also requires registration of both the trademark and the licensing agreement. Brazil is a signatory to the Paris Convention, which protects well-known non-registered marks, allowing for refusal or cancellation of trademarks that may cause confusion with these marks. Registrations can be annulled if a Brazilian registrant misappropriates a well-known foreign mark.
Under Brazilian law, individuals can pursue legal action for unfair competition, which includes fraudulent diversion of customers and the use of false designations of origin. In Argentina, trademark rights are obtained through registration rather than use, as established by Article 4 of Law No. 22.362. The registration grants property rights and exclusivity for ten years, renewable indefinitely if the trademark has been used within five years prior to expiration. If not used for five years before a nullification action, the trademark lapses.
Commercial names in Argentina are protected based on use, differentiating them from trademarks, though there is practical overlap. Articles 27 and 28 clarify that a commercial name is property acquired through use and must not confuse with prior names in the same field. Firms with established commercial names can oppose trademark registrations.
Trademarks can only be transferred if registered in Argentina, with transfers recognized once inscribed in the National Directory of Industrial Property. Foreign trademarks require registration in Argentina for protection, treated as national trademarks for foreign owners.
Licensing of trademarks is not specifically regulated, except for Article 9, which mandates that registered trademarks in joint names require collective action for licensing, transfer, or renewal. The Foreign Investment Law (Law 22.426) requires registration of all foreign patents and trademarks licensed to individuals or entities in Argentina. Article 1 covers technology or trademark transfers from abroad, necessitating registration with the National Institute of Industrial Property (INTI). Additionally, licensing agreements involving royalty payments to foreign entities require registration and scrutiny, although non-registered agreements are valid but incur higher withholding tax rates for payments.
Emergency Law No. 23.687 of 1989 in Argentina relaxed the requirement for prior governmental approval. Argentina is a signatory to the Paris Convention, with law 17.011 ratifying the Convention and its subsequent revisions. Argentine courts protect well-known foreign trademarks against piracy, similar to Brazil's approach.
In Venezuela, a mixed trademark system exists where both registration and use are protected, but registration is necessary for exclusive use. Article 3 of the 1955 Law of Industrial Property presumes ownership based on registration, allowing for challenges if a party can prove a "better right" through use. Trademark registration grants exclusivity for 15 years, limited to the registered class of goods. Non-use for two consecutive years leads to a loss of trademark rights, and subsequent use does not revive an expired mark. Any transfer of trademark rights must be recorded in the registration.
Venezuela's mixed system allows unregistered users to oppose registrations or seek cancellation within two years of a third party's registration. As a member of the Andean Pact, Venezuela follows the registration-based ownership principle. SIEX (Superintendency of Foreign Investments), established in 1975, oversees the implementation of Andean Pact regulations. All intellectual property agreements require approval from SIEX or the Ministry of Energy and Mines to be legally valid. Article 18 of Decision 24 mandates approval of contracts involving technology and trademarks, assessing the potential benefits of the imported technology.
Licensing contracts for the exploitation of foreign trademarks within Member Countries must not include restrictive clauses regarding export limitations, pricing controls, or royalty obligations for unused trademarks, as outlined in Article 25. Additionally, Article 7 of Decree 746 mandates that all contracts involving technology, patents, or trademarks by any type of company require prior authorization and post-signing registration with the Superintendency of Foreign Investments (SIEX), which must respond within sixty legal working days. Despite modifications to the Andean Pact's investment regime, the registration requirement remains in force, supported by Articles 61, 62, and 71 of Venezuelan Decree 656, which reiterates the necessity for authorization and registration of contracts regarding technology importation and trademark exploitation.
Venezuela's Decree 1200 of July 16, 1986, while believed to diverge from the Andean Pact, continues to uphold the registration requirement in Article 65. Article 66 allows for automatic authorization of technology contracts without prohibited clauses and royalties capped at 5% of net technological sales or 3% of net profits, although these still require registration. Article 67 mandates registration of any intellectual property licensing agreements effective in Venezuela with SIEX. Subsequent ANCOM Decisions 220 and 224 relaxed certain licensing restrictions but reaffirmed the need for registration.
Decree No. 727, adopted on January 26, 1990, facilitates foreign technology licensing, requiring agreements to be submitted to SIEX for registration within 60 days. Article 64 specifies that trademark licenses effective in Venezuela must also be registered with SIEX. Furthermore, Article 4 of the Venezuelan Industrial Property Law necessitates that trademark licenses be recorded at the Trademark Office for the licensee's use to benefit the trademark owner.
To record a license at the Trademark Office in Venezuela, it must first be recorded with SIEX. Venezuela is not a Paris Convention member, but Decision 85 of June 5, 1974, from the Andean Commission offers some protection for notorious marks. Articles 58(g) and 58(j) prevent trademark registration if they could be confused with well-known marks or translations of already registered trademarks. Venezuela's "better right" concept allows foreign trademark holders to protect against unauthorized registrations, although achieving success may take years. Notorious marks lack a dedicated registry, leading to potential registration by third parties.
In Paraguay, trademarks are governed by Law No. 751 of July 20, 1979, as amended. Unlike other jurisdictions, Paraguayan law prioritizes registration over use for exclusivity. Article 15 grants exclusive use rights to registered trademark owners and the ability to oppose confusing registrations. Protection for foreign trademarks begins only upon registration in Paraguay, as per Article 16. No use is required to maintain ownership rights, and registrations are valid for renewable ten-year periods. Article 30 mandates that all trademark licenses be recorded with the Directory of Industrial Property and published in Asuncion for five days, with translated copies of the contract submitted. Article 29 specifies that licensees must be Paraguayan merchants or manufacturers with relevant expertise. Paraguay also is not a Paris Convention signatory, but the first applicant typically gains registration rights, though unregistered mark owners can challenge in bad faith cases.
The 1929 Inter-American Convention for Trademark and Commercial Protection is determined not to govern trademark rights in Brazil, Venezuela, and Argentina, but it does apply to U.S. registered trademarks used in Paraguay. Article 1 of the treaty ensures equal rights and remedies for nationals of member states regarding trademarks and unfair competition.
A person must not only be domiciled in a contracting country but also have an establishment there to seek trademark protection. According to Article 2 of the 1929 Treaty, a trademark owner seeking protection in another contracting country must apply for registration there. Article 7 grants the owner of a mark in one contracting state the right to oppose the use or registration of a conflicting mark in another state if they prove that the infringer knew of the existing mark's use in connection with similar goods. If successful, the opposer may gain preferential rights to register the mark in the country of opposition, subject to local laws. This applies to U.S. trademark owners opposing registrations in Paraguay.
If the infringing mark has already been registered in Paraguay, the U.S. owner can file a lawsuit to cancel the registration by demonstrating prior legal protection of the mark in the U.S. Articles 8 and 9 allow for cancellation if the infringer's registration occurred after the U.S. owner had established rights, with abandonment defined by nonuse for specified periods. Article 12 protects U.S. owners when their marks are registered in Paraguay by agents or customers, allowing for cancellation and re-registration in their name if they can show prior rights.
Article 11 permits the licensing of trademarks, allowing separate transfers for each country, with the recording of such transfers at the discretion of each country’s laws. Finally, Articles 14 and following establish an inherent right for prior users to protect commercial names without the need for registration or deposit.
Article 19 of the 1929 Treaty limits its protective measures to the domestic laws of contracting states, diminishing its effectiveness. Articles 20-22 establish that nationals from these states can seek remedies for unfair competition, defined as actions that violate the ethical development of business against third parties. In the case involving Babbit Electronics, Inc. and Dynascan Corporation, Babbit initiated a fraud and tortious interference lawsuit, while Dynascan counterclaimed for trademark infringement and breach of contract. The court, hearing the case without a jury, confirmed jurisdiction under multiple statutes, including 15 U.S.C. 1121 and 28 U.S.C. 1331, 1332, and 1338. Dynascan holds several valid trademark registrations for its Cobra brand, recorded with U.S. Customs, and utilizes these trademarks for a range of consumer electronic products, generating over $150 million in annual sales in the U.S. Babbit has been involved in the electronics market, distributing products under the Cobra trademark since 1978, including products from Dynascan.
In the early 1980s, Babbit acquired overstock Cobra cordless telephones from Dynascan to sell in South and Central America, following an FCC decision that allowed manufacturers a grace period for outdated models. On August 16, 1985, Babbit entered into a licensing agreement with Dynascan, permitting the use of the Cobra trademark for certain models, in exchange for a royalty paid through letters of credit, initially set at 10% and later reduced to 5%. The agreement authorized Babbit to distribute the telephones in South and Central America but prohibited sales in the U.S. The telephones were consigned to Babbit and stored in a bonded warehouse in Florida before being shipped.
Throughout the agreement, the model numbers of the Cobra products changed, but the contractual terms remained the same. Dynascan inspected new models before production approval, except for the Model SA-660s, which Babbit ordered directly from Hyundai Corporation in July 1989 without Dynascan’s knowledge. Babbit received 6,060 units of the Model SA-660s, which were upgrades of a previously ordered model and were also identical to MCE Model 7312 telephones. Babbit did not inform Dynascan about this order or the receipt of the telephones.
Additionally, Babbit ordered Cobra labels and gift boxes for Model SA-620s directly from Hyundai in August 1989, also without notifying Dynascan. These items were shipped to Babbit’s warehouse in September 1989. MCE is a registered trademark of Metz Consumer Electronics, Inc., which is affiliated with Babbit, whose shareholders include Robert and Sol Steinmetz. Babbit did not pay any royalties to Dynascan for the SA-660s telephones.
In August 1989, Babbit, without Dynascan's knowledge, ordered 4,600 Cobra-branded Model SA-660 cordless telephones and 6,000 gift boxes with Cobra labels directly from Hyundai. By September 1989, Babbit received these items at his Florida warehouse but failed to pay Dynascan any royalties for them. Babbit subsequently shipped approximately 4,646 units of these telephones to South America, using gift boxes that had Cobra stickers placed over “MCE” labels.
In late 1989, the United States Customs Service seized 8,145 of Babbit's telephones, including 6,145 Cobra SA-660s and 2,000 Cobra SA-620s, due to violations of the Tariff Act of 1930. Dynascan, unaware of Hyundai's production of Cobra-branded telephones, informed Customs of its lack of consent for the importation and requested forfeiture of the seized items. On February 1, 1991, the U.S. declined to prosecute the seizures and released the telephones to Babbit, who then exported them to Panama.
The Court determined that testimony from Sol and Robert Steinmetz was not credible, particularly regarding claims of exclusivity for the South American market, which were found to pertain only to specific models mentioned in the Agreement. The Court ruled that Dynascan did not intentionally misrepresent facts about Babbit's distribution rights. Furthermore, there was no credible evidence indicating that Babbit would have refrained from entering the Agreement had he known about Dynascan's limited trademark protection in South America, which was primarily “use” protection rather than full registration. Babbit entered the Agreement to comply with U.S. trademark laws and to leverage Dynascan's trademark legitimacy, as the MCE trademark had limited sales potential.
Dynascan did not pursue any administrative or legal actions in South America to protect the Cobra trademark due to concerns regarding the judicial systems in those countries. Instead, it issued a letter of authenticity to Babbit in March 1987, asserting trademark protection in South America. The Court determined that this letter from Dennis Burke to Babbit did not indicate any fraud during the Agreement entered into in August 1985, nor did it suggest that Dynascan had trademark registrations in specific South American nations. Evidence did not support that Dynascan intended for Babbit to believe it held registered trademarks in South America.
Babbit, a knowledgeable electronics dealer, did not verify Dynascan's trademark registrations in South America before or during the first four years of their contractual relationship. Their partnership was profitable, with Babbit selling over $6 million worth of Cobra products between 1982 and 1989, yielding approximately $1.5 million in profits.
Babbit, along with Sol and Robert Steinmetz, engaged in the sale of Cobra cordless telephones from Florida. Dynascan holds Korean Trademark Registration No. 59154 for the Cobra trademark. Babbit and the Steinmetzes used the Cobra trademark on shipments of SA-660s cordless telephones to Panama in May 1991 without authorization, likely causing consumer confusion regarding the product's association with Dynascan.
The Court found the testimony regarding Dynascan's alleged tortious interference with Commtron to be non-credible or hearsay, concluding that Babbit was not informed it could not purchase from Commtron, although its credit privileges may have been temporarily affected. Dynascan's communications with Commtron were deemed to reflect its belief that Babbit had violated a contract by importing counterfeit products, rather than any malice towards Babbit.
Babbit, along with Sol Steinmetz and Robert Steinmetz, has been identified as the primary entity behind the unauthorized sales of Cobra products in South America, coordinating these activities from its Florida office. Prior to and following a Customs seizure, Babbit's unauthorized sales totaled $561,868.30. Babbit owed a five percent royalty of $28,093.42 to Dynascan on these sales, which it failed to pay, resulting in profits of approximately $140,467.08, or 25% of total sales.
In Count I of the Complaint, Babbit alleges Dynascan committed fraudulent misrepresentation by falsely claiming ownership of the Cobra trademark in South America. Under Florida law, the elements of fraud require a false statement of material fact, knowledge of its falsehood, intent to induce reliance, and resulting injury. The court determined that Dynascan did not make false statements regarding its trademark rights before the Agreement with Babbit, with credible evidence of misrepresentation occurring only after the Agreement was signed. Babbit entered the Agreement to avoid infringing on Dynascan’s U.S. trademark rights and to gain legitimacy associated with those rights. Dynascan's statements post-Agreement pertained only to "use" protection, not trademark registrations, which the court found was not a misrepresentation. Consequently, Babbit failed to demonstrate that Dynascan engaged in fraud.
In Count IV, Babbit claims Dynascan tortiously interfered with its business relationship with Commtron, a domestic distributor and supplier. To establish tortious interference, Babbit must show the existence of a business relationship and Dynascan's knowledge of that relationship.
Babbit's claim of tortious interference against Dynascan was rejected by the Court, which found that Dynascan's actions were justified due to Babbit's breach of contract. Dynascan's statements to Commtron regarding Babbit were based on a reasonable belief that Babbit had breached their Agreement by importing counterfeit goods. Under Florida law, interference in a business relationship is permissible if it is in furtherance of one's own interests, such as protecting a contract. Babbit failed to provide credible evidence that Dynascan explicitly instructed Commtron not to engage with Babbit, leading to the conclusion that Babbit did not prove tortious interference.
Dynascan's counterclaim included allegations of unfair competition, trademark violations, and breach of contract by Babbit. The Court first addressed the breach of contract, which stemmed from an August 16, 1985 Agreement allowing Babbit to use the Cobra trademark for certain cordless telephones in Central and South America, stipulating a royalty payment via letters of credit. Babbit violated this Agreement by not notifying Dynascan of its product distribution and by failing to pay the required five percent royalty. The Court found Babbit had breached the contract.
Dynascan's trademark infringement claim under 15 U.S.C. 1114(l)(a) was also considered, with Dynascan presenting certificates of registration for the "Cobra" trademarks, asserting that Babbit's actions were likely to cause confusion in the marketplace.
The Court is tasked with assessing whether Babbit's use of the Cobra trademark creates a likelihood of confusion regarding the source or sponsorship of its products. Factors considered in this analysis include design similarity, product similarity, shared retail outlets and purchasers, advertising media, the defendant’s intent, and instances of actual confusion. The Court finds that Babbit’s sale of Cobra cordless telephones is likely to mislead consumers into believing there is an association with or sponsorship by Dynascan, as the trademarks used are identical and the products closely resemble each other. Although there is no evidence of actual confusion, Babbit's intentional infringement of Dynascan's trademark rights and breach of agreement leads to a rebuttable presumption of confusion. The intent to copy is a critical factor, as it suggests an attempt to benefit from the reputation of the plaintiff's trademark. Babbit aimed to boost sales by relabeling MCE telephones with Cobra labels due to previous sales difficulties.
In opposition, Babbit argues that the lack of direct competition negates the likelihood of confusion. However, the Court emphasizes that the likelihood of confusion, not competition, is the true test of trademark infringement under the Lanham Act. The Court notes that substantial evidence of competition between the two companies in South America is not expected, given that Babbit was already selling Cobra telephones there with Dynascan's permission. Thus, the Court concludes that trademark infringement has occurred based on the likelihood of confusion analysis.
Dynascan retains the right to use its trademark on various goods despite allegations of infringement, as established in Bowmar Instrument Co. v. Continental Microsystems. Babbit argues that U.S. copyright laws and the Lanham Act do not apply to its sales of cordless telephones since these occurred outside the U.S. However, the court finds that Lanham Act jurisdiction exists due to Babbit importing the products into a U.S. free trade zone before exporting them to South America. Babbit cites Zenger-Miller, which ruled out Lanham Act jurisdiction for a foreign corporation's sales solely in Germany. The court distinguishes this case by noting that Babbit is an American corporation and that the agreement's negotiations primarily occurred in the U.S. Additionally, Babbit's activities included importing labels and orchestrating sales from Florida, paralleling Reebok International’s ruling that jurisdiction exists when goods enter a U.S. free trade zone. The court concludes it has jurisdiction over the trademark infringement counterclaim. Babbit also claims Dynascan has engaged in “naked licensing,” which would forfeit rights to the Cobra mark. Nonetheless, the presence of counterfeiters in South America does not equate to abandonment, especially if Dynascan actively pursues infringers. To prove abandonment, intent to abandon by the trademark owner must be demonstrated.
Dynascan's lack of vigorous legal action against third-party infringers in South America does not equate to abandonment of its Cobra trademark, as established in Playboy Enterprises v. P.K Sorren Export Co. Babbit failed to prove that Dynascan intentionally abandoned the trademark or ceased its use. Babbit's claim of no Lanham Act violation hinges on the assertion that the alleged counterfeit articles are genuine products; however, unauthorized sales of genuine goods can still constitute trademark infringement. Babbit's failure to order the Model SA-660s through Dynascan and to submit it for approval is critical, as the SA-660s is physically distinct from authorized Cobra models. The absence of evidence suggesting inferiority of the SA-660s does not negate a Lanham Act violation. For Dynascan to succeed in its counterfeiting claim under 15 U.S.C. 1114, it must show Babbit infringed a registered trademark and knowingly used a counterfeit mark, which the court confirmed. The Agreement between Babbit and Dynascan explicitly restricted Babbit's use of the Cobra trademark to products ordered through Dynascan. Babbit's attachment of Dynascan's trademarks to the SA-660s, which were not ordered in accordance with the Agreement, indicates that Babbit knew these were not authorized products. Therefore, Babbit is liable for trademark counterfeiting due to its knowing use of the trademarks in violation of the Agreement.
Dilution Dynascan alleges false designation of origin under Section 43(a) of the Lanham Act, alongside state law claims for dilution (Fla. Stat. 495.151) and unfair trade practices (Fla. Stat. 501.204(1)), as well as common law unfair competition. The factual basis for Dynascan's claims under Section 1114(a)(1) applies equally to Section 1125, which encompasses false advertising regardless of trademark infringement, and the analysis for unfair competition is consistent with these claims. Dynascan seeks relief for dilution, asserting that the use of a similar mark by Babbit could harm its business reputation and dilute its mark's distinctiveness, with a likelihood of dilution indicated by potential consumer confusion.
Dynascan claims entitlement to various damages under the Lanham Act, including a permanent injunction, treble damages, attorney's fees, and prejudgment interest. The Act allows a successful plaintiff to recover the defendant's profits, any damages sustained, and costs, with these recoveries being cumulative. Regarding Babbit's profits, since the infringement is deemed deliberate, an accounting for profits is warranted to deter future violations. Babbit's sales of infringing products totaled $561,868.30, yielding profits of approximately $140,467.08 based on a 25% profit margin.
For Dynascan to recover damages aside from Babbit's profits, it must demonstrate actual damages, typically measured by the royalties of the mark owner. This requires proof of lost sales directly attributable to Babbit's actions.
Dynascan has not proven it would have made sales equivalent to those made by Babbit, but the Court finds that Babbit would have purchased legitimate Cobra telephones if it had not acquired counterfeits. Babbit's inability to sell MCE-labeled telephones, coupled with the profitability of the counterfeit Cobra telephones, supports this conclusion. Dynascan is entitled to damages of $28,098.42 for Babbit's failure to pay the required five percent royalty on $561,868.30 in cordless telephone sales.
Regarding the trebling of damages, the Court has discretion to enhance the award up to three times the amount of actual damages or profits, based on a showing of harm. However, if infringement is intentional, the Court is required to treble damages and award attorney's fees unless extenuating circumstances exist. Dynascan has established that Babbit intentionally infringed on the Cobra trademark and used a counterfeit mark, warranting a trebling of damages to $421,401.24.
Dynascan is also entitled to recover costs, which must be submitted to the Court within fifteen days. In this exceptional case, where Babbit knowingly obtained counterfeit goods and disregarded contractual obligations, attorney's fees are awarded to Dynascan, which must submit a detailed affidavit within the same timeframe. The Court has discretion to award prejudgment interest from the date Dynascan filed counterclaims until the trial's conclusion, which has been granted.
Finally, Dynascan requests that the relief awarded be applied jointly and severally to Babbit and its officers, Robert and Sol Steinmetz, who were personally involved in the trademark infringement despite being notified of its illegality. As such, they hold personal responsibility for the infringement.
A corporate officer who is involved in infringing activities related to trademark use can be held personally liable, independent of corporate protections. In the case referenced, neither Robert nor Sol Steinmetz contested their roles in the infringement of Dynascan’s trademark, leading to their joint liability for the counterfeiting activities. The court ruled in favor of Dynascan against Babbit's complaint and counterclaim, confirming Dynascan's ownership of the "Cobra" trademark. Babbit sought a declaratory judgment to rescind an agreement regarding royalty payments for sales of Cobra goods, claiming it was fraudulently induced. However, the court found no merit in Babbit's fraud claim, denying the request for a declaratory judgment. Additionally, Dynascan's breach of contract claim is outlined, with relevant statutory provisions highlighted: Section 1114 addresses civil liability for trademark infringement, emphasizing that evidence of actual confusion is not necessary for establishing likely confusion. Section 1117 allows for treble damages and attorney's fees in cases of intentional counterfeiting, defined as marks that are identical or substantially indistinguishable from registered trademarks. The court acknowledged Babbit's arguments but ultimately affirmed Dynascan's position under Florida law.
Sections 501.201-213 are limited to remedies for consumer transactions and do not apply to this case. No relevant case law has been found to indicate that the Tariff Act of 1930 applies to standard trademark infringement. Although the Tariff Act prohibits importing trademarked goods without the owner's consent, the court believes Congress did not intend for this provision to have such a broad application. The court supports this interpretation by referencing Vivitar Corp. v. United States, which cautioned against overly expansive interpretations of the Act.
Babbit's sale of cordless telephones bearing the Cobra trademark has infringed Dynascan's trademarks, violating the Lanham Act. Consequently, Dynascan is entitled to an injunction against Babbit and associated parties from unauthorized use of its trademarks, specifically concerning the sale and promotion of certain telephones. Additionally, Dynascan is entitled to damages for lost royalties due to Babbit's breach of contract. The court also notes that Dynascan can recover attorney's fees based on the personal guarantees provided by Robert and Sol Steinmetz under the Agreement.
