In a recent published decision, the U.S. Court of Appeals for the Tenth Circuit confronted for the first time the question of whether the Lanham Act’s scope extends outside of the United States. Reviewing decisions from other circuits, the appellate court held that the Act can have extraterritorial application, if certain conditions are met. In doing so, the Tenth Circuit recognized—and further deepened—an ongoing circuit split.
Hetronic International, the plaintiff in the case, is an American company that manufactures remote ratio controls used to operate heavy-duty construction equipment. Hetronic International v. Hetronic Germany, GmbH, Nos. 20-6057 & 20-6100, 2021 U.S. App. LEXIS 25354, at *1 (10th Cir. Aug. 24, 2021). In the mid-2000s Hetronic entered into licensing and distribution contracts with a few foreign companies (the defendants below) under which those foreign companies would distribute Hetronic’s products, mostly in Europe. Id. The relationship worked well for several years, until one of the defendants “embrac[ed] a creative legal interpretation” of one of the parties’ agreements and asserted that they, and not Hetronic, owned the rights to Hetronic’s intellectual property. Id. at *2. The defendants began manufacturing their own products and selling them under the Hetronic brand—again mostly in Europe.