Court refuses to apply ‘unlawful use doctrine’

Where the Fourth Circuit has not yet recognized the “unlawful use doctrine” as a valid affirmative defense to actions for trademark infringement, and there is a split among other circuits to decide the issue, the court declined to consider the doctrine in a trademark dispute among dealers of golf-cart type vehicles.

Background

The parties, both dealers in “low-speed land vehicles,” find themselves locked in a legal battle over a disputed trademark: the “MOKE” mark. Plaintiff Moke America claims that it acquired common law trademark rights in the Mark via a November 2016 assignment from non-party Mini Mania Inc. Defendants Moke International, Moke USA and American Custom Golf Cars Inc., or ACG, claim that Moke International – the ultimate assignee of trademark rights initially belonging to ACG – owns trademark rights in the mark pursuant to ACG’s August 2015 trademark application with the Patent and Trademark Office.

Currently before the court is plaintiff’s motion to exclude testimony from defendants’ expert Coleman Sachs, a former National Highway Traffic Safety Administration employee, who intends to opine about plaintiff’s alleged violations of the National Traffic and Motor Vehicle Safety Act.

Analysis

Defendants primarily offer Mr. Sachs’ testimony to call into question plaintiff’s trademark rights under the unlawful use doctrine. The “unlawful use doctrine” stands for the proposition that unlawful commercial activities “cannot provide the basis for a protectable trademark interest.” A collection of federal courts, including two circuit courts, have recognized the “unlawful use doctrine” as a valid affirmative defense to actions for trademark infringement. On the other hand, several federal courts, including two circuit courts, have explicitly declined to adopt the “unlawful use doctrine” in trademark infringement cases.

The Fourth Circuit has yet to address the unlawful use doctrine, and this court can identify only two cases from its sister courts within the Fourth Circuit that address the doctrine. One court did not reach the issue while the other applied the doctrine. Against this backdrop, the court will prohibit all evidence pertaining to the “unlawful use doctrine” from trial. Defendants fail to meet their burden of establishing the doctrine’s propriety in this case.

Indeed, defendants limit their discussion of the issue to a single sentence in their response brief – a far cry from the clear and convincing evidence required to establish the doctrine’s applicability. Because the court declines to adopt the “unlawful use doctrine,” the sole issue to which Mr. Sachs’ proposed testimony speaks, the court finds that Mr. Sachs’ opinions will shed no light on the relevant inquiries in this case.

Plaintiff’s motion to exclude expert testimony granted.

Moke America LLC v. American Custom Golf Cars Inc., Case No. 3:20-cv-400, Dec. 6, 2022. EDVA at Richmond (Novak). VLW 022-3-548. 21 pp.