(CN) – Logos for the VO5 line of hair-care and beauty products can have a different look in Japan, the 7th Circuit determined in a trademark case that required U.S. courts to translate and interpret Japanese legal terms.
Alberto VO5 is a beauty product line that’s been established in the United States for 53 years. In 1980 parent company Alberto-Culver sold Japanese trademark registrations to the Japanese manufacturer Sunstar for more than $10 million.
The agreement granted the Japanese company senyoshiyoken, which in English means “exclusive-use right.”
Nine years after the agreement, Sunstar asked Alberto-Culver for permission to use a new variant of the VO5 logo, but the company refused. Sunstar ultimately agreed to pay $10 million for the right to change the logo. Ten years later, Sunstar again changed the logo by adding a black background and a vertical bar instead of a space between the “O” and the “5,” describing the changes as a “modernized” version of the licensed trademarks.
Alberto-Culver sued, seeking an order rescinding the license and returning the trademarks to Alberto-Culver.
The legal battle focused on the differences between Japanese and U.S. law, and mainly became a quest to find the true meaning of senyoshiyoken.
During deliberations, a jury asked the district judge: “What exclusive rights does the Senyoshiyoken license give Sunstar PLEASE BE EXPLICIT!” But the judge, apparently finding the Japanese legal meaning irrelevant, declined to answer.
The jury ruled for Alberto-Culver without awarding any damages, and the trial judge barred Sunstar from using the modified VO5 logo and ordered the license agreement terminated.
Posner noted that Japanese law, like U.S. law, allows for “modest changes in the appearance or wording of the trademark.”
He said there was “no suggestion” that Sunstar had violated its licensing agreement.
“Apparently Sunstar has done better in Japan than Alberto-Culver expected, and, as in 1989, Alberto-Culver has tried to use a hypertechnical, but more important an unsound, interpretation of the licensing agreement to extort additional compensation,” Posner wrote.
The Chicago-based appeals court vacated the district court’s ruling and remanded.