License Drafting Rule No. 1: Don’t Say 専用使用権 Unless You Mean It

Just like Alberto-Culver, we don't know what 専用使用権 means, but our hair looks great!


We have said it before, because it is true. Seemingly small differences in contract wording lead to major differences in real-world consequences.

This rule especially applies when the contractual wording is in a foreign language, as Alberto-Culver, the makers of Alberto VO5 hair care products, discovered when they lost an appeal of a breach of trademark license case which turned on a Japanese legal phrase that Alberto-Culver did not completely understand and was not otherwise defined at the time of drafting the license agreement.

With licensing increasingly utilized as a tool of expansion into international markets, the case is a good lesson in what NOT to do.

In 1980, for lump-sum royalty payments of $10 million, Alberto-Culver gave Sunstar a 99 year exclusive license to manufacture and sell hair care products in Japan under the VO5 trademarks, after which Sunstar would own the registrations. The license agreement had appendices showing which VO5 logos and marks Sunstar could use. The agreement said that Sunstar’s license would have the status of a “senyoushiyouken” (専用使用権), which translates literally from Japanese as “exclusive use right.” But the license did not include an English definition of “senyoushiyouken.” Under the Japanese Trademark Act, the “senyoushiyouken” is exclusive even against the trademark owner, and the holder has other rights nearly equal to the owner, including the right to sue infringers in its own name.

Sunstar clashed repeatedly with Alberto-Culver over its ability to modernize the VO5 logos for the Japanese market. Against Alberto-Culver’s wishes, Sunstar went ahead with updated logos once in 1989, which led to a negotiated settlement with payment of an additional $10 million by Sunstar. When it happened a second time 10 years later, Sunstar refused to negotiate, arguing that under Japanese law, a licensee with “senyoushiyouken” status is legally entitled to use a registered trademark with minor format changes. For example, Article 50.1 of the Japanese Trademark Act, which deals with rescission of unused registered trademarks, recognizes that holders of “senyoushiyouken” are authorized to use:


“…a registered trademark (including a trademark deemed identical from common sense perspective with the registered trademark, including a trademark consisting of characters identical with the registered trademark but in different fonts, a trademark that is written in different characters, hiragana characters, katakana characters, or Latin alphabetic characters, from the registered trademark but identical with the registered trademark in terms of pronunciation and concept, and a trademark consisting of figures that are considered identical in terms of appearance as those of the registered trademark…).”

This set up an interesting legal hall of mirrors for the lawsuit. Alberto-Culver argued that the only reason that the word “senyoushiyouken” was used in the contract was that in 1980 the negotiating parties wanted to give Sunstar language it could use to register the license with the Japanese trademark office. (Many foreign governments require trademark licenses to be registered to be effective.) Since the agreement provided that it was to be interpreted under Illinois law, the Japanese meaning of “senyoushiyouken” and any rights granted by it were irrelevant, said Alberto-Culver. Rather, the agreement should be interpreted as an exclusive license under Illinois law, which would require the licensee to attain prior consent to even minor format changes per explicit provisions in the license agreement.

Alberto-Culver won at trial, but that decision was forcefully overturned on appeal by the Seventh Circuit Court of Appeals in Sunstar, Inc. v. Alberto-Culver Co. (decision available here by entering case number 07-3288), where Judge Richard Posner wrote that when sophisticated parties use technical terms in a contract, they must be presumed to use and understand them in the technical sense. In so doing, the court followed a common rule of contract interpretation that whenever possible, courts should interpret contracts as a reasonable third party would by looking only at the words within the four corners of the contract, and without researching the history of the negotiations or other extrinsic evidence of the parties’ subjective intent. In other words, Alberto-Culver would be presumed to understand and consent to the meaning of any Japanese legal terms included in the license agreement, and therefore Sunstar was not in breach for using modernized VO5 marks.

Takeaway: in any license or other agreement regarding the disposition of valuable intellectual property rights, avoid vague letter agreements or memorandums of understanding, especially those that contain undefined technical words and other shorthand terminology. The contract should include a definitions section with detailed definitions for any technical terminology or terms of art. It will take a little bit longer to negotiate the contract, but 注意一秒、けが一生. [Translation: “An ounce of prevention is worth a pound of cure.”]

Sunstar VO5 commercials featuring 1989 version of updated logo, with song advising, “Don’t cry about split ends,” because the conditioner’s UHM Silicon will fix them.




1980年にアルベルト・カルバーはサンスターに1,000万ドルのライセンス料に基づいて99年間の日本におけるVO5のヘアケア用品の商標ライセンスを許諾しました。99年間が終了する時、サンスターはVO5の商標主になるという仕組みでした。ライセンス契約書には、ライセンスされた商標で認めた形の映像が別紙に添付されました。英文の契約書にも、サンスターのライセンス権は日本語の「senyoushiyouken (専用使用権)」という言葉で記載されましたが、「senyoushiyouken」の定義は含まれていませんでした。日本の商標法において、専用使用権者は本来の商標権者に対しても専有的な使用権と侵害の訴訟を自分の名前で提出する権利も含め、商標権者とほとんど対等な権利を擁します。


「登録商標(書体のみに変更を加えた同一の文字からなる商標、平仮名、片仮名及びローマ字の文字の表示を相互に変更するものであって同一の称呼及び 観念を生ずる商標、外観において同視される図形からなる商標その他の当該登録商標と社会通念上同一と認められる商標を含む…)。」

その結果、訴訟において契約書の意味の解釈に関し、ややこしい矛盾が起こりました。アルベルト・カルバーによると、契約書に日本語の「senyoushiyouken (専用使用権)」という表現を含めた理由は、ただ単に、1980年に契約書の交渉者はサンスターがライセンスを日本の特許庁に登録できるようにするためでした。日本の法律においての専用使用権の権利をサンスターに与えるという意志はまったくありませんでした。ライセンスの準拠法はアメリカのイリノイ州でしたから、日本法における意味とその関連権利はアメリカでの契約書の執行と解釈には全然関係ないとアルベルト・カルバーは弁論しました。そればかりか、ライセンス契約書の詳しい条件に即し、ライセンシーがVO5ロゴをわずかにアップデートする場合にもライセンサーのアルベルト・カルバーの許諾を得なければならない。そうしないと、契約書の違反になると主張しました。

第一審裁判所では、アルベルト・カルバーが勝ちましたが、連邦第7巡回控訴裁判所で、その判決は覆りました。(決定書をご覧になりたい方はこのリンク をクリックして、07-3288というケース番号を入れて下さい。)ポスナー裁判官は教養のある当事者が契約書に専門用語を使う場合、当事者は専門的な意味で使うつもりがあったと解釈するという決定を下しました。その決定の背景には、契約書の解釈をするとき、当事者の当時の主観的な立場からではなく、客観的な第三者の立場から、契約書に含まれている言葉のみによって、契約書を解釈しなければいけないというアメリカの契約法の基本原則があります。従って、日本語の「senyoushiyouken (専用使用権)」の解釈に基づけば、サンスターのロゴのアップデートはライセンスの違反ではなく、その結果、サンスターは控訴裁判所で勝訴したのです。

ワンポイント:ライセンスあるいはほかの大事な知的財産に関わる契約書を作成する場合には、特に定義されていない専門用語や外国語を含めたあやふやなメモ式の契約書を避けるべきだと思います。また専門用語は契約書の特別な定義条項に定義を詳しく説明した方がいいと思います。交渉の時間は長引くかもしれませんが、「An ounce of prevention is worth a pound of cure.」 (翻訳:注意一秒、けが一生。)です。

© 2010 – 2011, Richard R. Bergovoy. All rights reserved.

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