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You're Going to Serve Someone, But Will You Have Jurisdiction?

By Jonathan Moskin

When is a proceeding not a proceeding, or more precisely, when is a proceeding affecting a mark not a proceeding affecting a mark? No mere word game, the answer can have a profound impact on foreign trademark owners who routinely (and perhaps unthinkingly) appoint their U.S. attorneys as agents to accept service in proceedings affecting their marks. The answer ' or at least an answer ' recently was provided by the U.S. District Court for the Eastern District of California in E&J Gallo Winery v. Cantine Rallo, S.p.A., slip op. 1:04 cv 5153 (OWW) (Aug. 17, 2005), where just such a profound impact faced an Italian winery with a long history whose American counsel accepted service of a summons and complaint in an infringement suit, but made only fleeting efforts to alert his foreign client. The court vacated a default judgment that threatened to terminate a 50-year business in this country because the domestic attorney designated by the foreign trademark applicant under 15 U.S.C. '1051(e) to receive service in “proceedings” affecting the mark was deemed not authorized to receive service in a “litigation” affecting the mark. (The defendant's failure to answer was also deemed excusable neglect. Following the default, the author is now representing the defendant.)

Prior to its recent amendment in 2002, 15 U.S.C. '1051(e) of the Lanham Act required foreign trademark applicants to designate a domestic representative authorized to accept service in “proceedings affecting the mark.” The provision, which in 2002 was made voluntary (no longer mandatory), is not unlike the section of the Patent Act, 35 U.S.C. '293, that provides for the filing in the Patent and Trademark Office by non-resident patentees of “a written designation stating the name and address of a person residing in the United States on whom may be served process or notice of proceedings affecting the patent or rights thereunder.” E&J Gallo Winery parted company with the few recent decisions to assess the meaning of the statute in holding that such an appointment ' whatever its effect in administrative proceedings ' does not authorize the designated agent to accept service in litigations affecting the mark. The court thus vacated the default judgment, finding that service on an attorney who had appointed himself domestic representative did not make him agent for service of process for all purposes.

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