PT 8 section 3 #10

ahri
Posts: 36
Joined: Wed Jul 18, 2012 9:04 pm

PT 8 section 3 #10

Postby ahri » Tue Apr 16, 2013 2:31 am

"the right of trademark owners to enforce, in countries in which the trademarks are registered, distribution agreements intended to restrict distribution to authorized channels"

Can someone explain this sentence to me, especially "distribution agreements intended to restrict distribution to authorized channels"
I understand it to mean that the distribution agreements restrict distribution to authorized channels. But the kaplan and manhattan logic forum say it means distribution agreements restrict authorized channels' distribution.

Manhattan LSAT Noah
Posts: 746
Joined: Tue Oct 12, 2010 8:43 am

Re: PT 8 section 3 #10

Postby Manhattan LSAT Noah » Tue Apr 16, 2013 11:22 am

ahri wrote:"the right of trademark owners to enforce, in countries in which the trademarks are registered, distribution agreements intended to restrict distribution to authorized channels"

Can someone explain this sentence to me, especially "distribution agreements intended to restrict distribution to authorized channels"
I understand it to mean that the distribution agreements restrict distribution to authorized channels. But the kaplan and manhattan logic forum say it means distribution agreements restrict authorized channels' distribution.

I looked on our forum, and I don't see that interpretation there. Maybe I'm missing something though.

In short, I'd say that answer means the right of trademark owners to enforce agreements that restrict how stuff is distributed in countries in which they have registered trademarks--specifically the issue is whether the stuff gets distributed only to authorized channels or can the stuff get also distributed through these shady gray ones.

That clear it up?

ahri
Posts: 36
Joined: Wed Jul 18, 2012 9:04 pm

Re: PT 8 section 3 #10

Postby ahri » Tue Apr 16, 2013 11:48 am

maybe I'm having trouble with the question itself. Exhaustion theory says the trademark does not have the right to tell distributors who they can they distribute to because once trademark sells it they lose the right. While territoriality theory gives the right to trademark company, as long as they are in the country which trademark registered, to control, within that country, how distribution distributes.

So the theories conflict at the point when after selling to distribution does trademark have control over the product's distribution.

"distribution agreements intended to restrict distribution to authorized channels"- for both theories, the trademark company do have the right to restrict distribution to authorized channels. They don't have the right to control distribution, according to exhaustion theory, after the initial trademark and distribution sale.

I marked it wrong because i thought it had to say for it to be right "distribution agreements intended to restrict distribution to UNauthorized channels" Because why would they ever restrict distribution to authorized channels? I know in the passage it says authorized channels buy bulk for a discount then unload part of the product to unauthorized sellers, so there can be a reason to restrict distribution to authorized channels. But exhaustion theory says a trademark company loses it's right's of distribution after they sell, so restricting distribution to authorized sellers still wouldn't conflict with the exhaustion theory since it's the initial sale which they do have right to control distribution.

Manhattan LSAT Noah
Posts: 746
Joined: Tue Oct 12, 2010 8:43 am

Re: PT 8 section 3 #10

Postby Manhattan LSAT Noah » Tue Apr 16, 2013 1:52 pm

It's not about restricting distribution but enforcing agreements along those lines.

I don't see the two theories as coming down in the same way:

Exhaustion theory folks think they your rights completely end once you've sold it. What would they say about enforcing restrictive distribution agreements? "Sorry, your rights were exhausted."

Territoriality folks think the trademark remains in effect if the stuff is sold to a country where the trademark is effective. What would they say about enforcing those restrictive distribution agreements? "If you're selling to a country where the trademark is registered, definitely you have the right to enforce that!"

I fear I may not be understanding your confusion, so feel free to explain.

ahri
Posts: 36
Joined: Wed Jul 18, 2012 9:04 pm

Re: PT 8 section 3 #10

Postby ahri » Tue Apr 16, 2013 2:20 pm

I think I'm understanding the answer choice incorrectly. I'm going to break it down as how I see it. For point of reference, the answer choice says, "the right of trademark owners to enforce, in countries in which the trademarks are registered, distribution agreements intended to restrict distribution to authorized channels"

I interpret it as - in countries which trademarks are registered, the trademark owners enforce "distribution agreements" that limit the amount they sell to the authorized channels. So the "distribution agreements" only deals with the initial sale between trademark owners and distributors, not any sale afterwards.

Exhaustion theory says:
Manhattan LSAT Noah wrote:Exhaustion theory folks think they your rights completely end once you've sold it. What would they say about enforcing restrictive distribution agreements? "Sorry, your rights were exhausted."


So exhaustion theory can't apply to the initial sale between the trademark owners and distributors. They have the right to restrict distribution to authorized channels because the trademark owners are the ones selling it. And Territoriality theory also believe you have that right. So they do not differ in opinion on this matter.

Manhattan LSAT Noah
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Joined: Tue Oct 12, 2010 8:43 am

Re: PT 8 section 3 #10

Postby Manhattan LSAT Noah » Tue Apr 16, 2013 2:28 pm

Ah, I see. I think you're misinterpreting what is getting enforced. Whether the trademark owner sells or not is not the issues. It's about whether the purchaser--think of them as the distributor in the country--can then sell the stuff only to authorized channels.

The gray market is all about re-selling.

ahri
Posts: 36
Joined: Wed Jul 18, 2012 9:04 pm

Re: PT 8 section 3 #10

Postby ahri » Tue Apr 16, 2013 2:38 pm

but the answer choice says, "the right of trademark owners to enforce, in countries in which the trademarks are registered, distribution agreements intended to restrict distribution to authorized channels"

"distribution agreements intended to restrict distribution to authorized channels"- the "distribution agreement" restricts distribution to authorize channels. This means distributors can sell as much or as little to authorized channels.

"distribution agreement" doesn't involve restricting distribution to Unauthorized channels.

ahri
Posts: 36
Joined: Wed Jul 18, 2012 9:04 pm

Re: PT 8 section 3 #10

Postby ahri » Tue Apr 16, 2013 3:29 pm

Alright i think i just made a break through. Please tell me if i'm right...


Exhaustion theory pretty much says once you sell it you have no control over its distribution. So the "distribution agreement", which intends to restrict selling to authorized channels, is unlawful according to the Exhaustion theory because regardless if the distributor is distributing the product to unauthorized or authorized, the trademark owners cannot control it.

Manhattan LSAT Noah
Posts: 746
Joined: Tue Oct 12, 2010 8:43 am

Re: PT 8 section 3 #10

Postby Manhattan LSAT Noah » Tue Apr 16, 2013 4:31 pm

ahri wrote:Alright i think i just made a break through. Please tell me if i'm right...


Exhaustion theory pretty much says once you sell it you have no control over its distribution. So the "distribution agreement", which intends to restrict selling to authorized channels, is unlawful according to the Exhaustion theory because regardless if the distributor is distributing the product to unauthorized or authorized, the trademark owners cannot control it.

Yes.




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