January 21, 2015

Tacking or Not? You be the Judge … or Rather, the Jury!

So says today's Supreme Court decision in Hana Financial, Inc. v. Hana Bank later this term.

Hana Bank, a decades-old Korean financial institution, began providing services in the US in 1994, using "Hana Bank" in Korean and "Hana Overseas Club" in English. A year later, a different organization, Hana Financial, formed and began using "Hana Financial" for financial services. In 1996, Hana Financial obtained a federal registration for HANA FINANCIAL (& pyramid design) for use with financial services. In 2002, Hana Bank established a physical presence in the US and began using "HANA BANK."

In 2007, Hana Financial sued Hana Bank for trademark infringement. Hana Bank responded by claiming priority: saying it had used the mark first by virtue of tacking. It argued that it could tack its current use of "HANA BANK" on to its earlier variations of "Hana" marks to support its argument that it had priority over Hana Financial and therefore was not infringing.

What is "tacking" you ask?

Tacking is a doctrine that applies in limited circumstances. It allows mark owner claim priority in a mark based on the first use date of a technically different, but very similar mark it had used before. Thus, one "tacks on" the use of the current mark to the use of the earlier version of the mark to determine the priority date of the current mark. This can only happen if both versions of the mark create the same commercial impression and consumers perceive them as essentially the same mark. This doctrine allows brand owners to make modifications to their marks over time without losing priority.

Who decides whether tacking is permitted in a particular case?

At trial in the Hana Financial v Hana Bank case, the jury rendered a verdict for Hana Bank, deciding that its current variation of the mark created the same commercial impression as the version it had used before Hana Financial entered the market. This decision was affirmed on appeal. Hana Financial asked the Supreme Court to hear the case to decide whether the judge should have decided the issue rather than the jury.

Hana Financial
Hana Bank

Typically, judges decide questions of law and juries decide questions of fact. The Ninth Circuit left the fact-intensive question of tacking for a jury to decide. But in the Federal and Sixth Circuits, tacking was treated as a question of law reserved for the judge.

Today, the Supreme Court resolved the issue in a unanimous decision, determining that whether tacking applies in a particular case is a question for a jury. Of course, if the facts of a particular case warrant a decision on summary judgment or judgment as a matter of law, or if the parties agree to try the case before a judge, the judge may decide the issue. Otherwise, who better than a jury to decide whether two marks create the same commercial impression to the ordinary consumer?

The lawyers at Trademarkology provide trademark registration services backed by the experience and service of one of the nation's oldest law firms. Click here to contact us.

**HANA FINANCIAL image obtained from Hana Financial's website; HANA BANK image subject of one of Hana Bank's pending applications