## Facts

- The prewar Abbe Foundation in Jena used and controlled the “Zeiss” trade names and trademarks for optical and photographic goods, including in the United States.
- In 1949, Soviet/East German authorities expropriated the Foundation’s assets in East Germany by decree that purported to reach Zeiss trademarks wherever located.
- Foundation officials relocated to West Germany, reconstituted the enterprise as Carl Zeiss Stiftung, and claimed continuity with the original Foundation and ownership of Zeiss rights outside East Germany, including in the United States.
- In 1951, East Germany created V.E.B. Carl Zeiss, Jena as a state enterprise, which marketed goods under “Zeiss” marks similar or identical to those claimed by the West German foundation.
- Both sides pursued rights in multiple jurisdictions; defendants relied in part on an East German high court judgment favoring the East German entity.
- In the United States, plaintiffs alleged defendants and their American distributors used the Zeiss marks in a manner constituting trademark infringement and unfair competition.
- The district court addressed ownership and liability but deferred final judgment pending proceedings on damages and antitrust counterclaims.

## Issues

1. Which entity was legally identical with, and the successor to, the original Abbe Foundation for purposes of ownership of U.S. Zeiss trademarks and trade names.
2. Whether the Soviet/East German expropriation decree could divest or transfer ownership of U.S. trademarks (i.e., have extraterritorial effect in the United States).
3. Whether, and to what extent, U.S. courts should give effect to East German state acts and judgments affecting property claimed in the United States.
4. If plaintiffs owned the U.S. marks, whether defendants’ U.S. use constituted trademark infringement and unfair competition.
5. Whether defendants’ antitrust counterclaims and misuse theories barred relief (reserved).

## Decision

- The court held Carl Zeiss Stiftung was legally identical with and the successor to the original Abbe Foundation.
- The court held plaintiffs were entitled to the sole and exclusive use of the disputed Zeiss trademarks and trade names in the United States.
- The court declined to give effect to the Soviet/East German expropriation decree insofar as it purported to reach U.S.-located trademark property.
- The court found V.E.B. Carl Zeiss, Jena and associated distributors infringed the U.S. marks and engaged in unfair competition in the United States.
- Entry of final judgment, damages, and adjudication of antitrust counterclaims were deferred.

## Legal Principles

- U.S. trademarks are treated as property located in the United States for purposes of determining whether foreign expropriation should be recognized, even if the trademarked goods are manufactured abroad.
- U.S. courts generally will not recognize a foreign expropriation decree to the extent it purports to transfer or extinguish title to property situated in the United States.
- The act of state doctrine does not require giving extraterritorial effect to a foreign taking that reaches U.S.-located property; U.S. public policy may preclude recognition in that setting.
- In determining successorship of a foreign foundation or similar legal entity, courts examine continuity of governing organs and personnel, lawful steps taken to continue the entity in another jurisdiction, and whether a competing claimant is a newly created state enterprise rather than a continuation of the prior legal person.
- Once ownership is established, use of identical or confusingly similar marks in U.S. commerce can constitute trademark infringement and unfair competition.

## Conclusion

The court determined that the West German foundation was the legal successor to the original Zeiss foundation and owned the Zeiss marks in the United States; it refused to recognize a foreign expropriation as transferring U.S.-situated trademark rights, found infringement and unfair competition, and reserved damages and antitrust issues for later proceedings.


Carl Zeiss Stiftung v. V.E.B. Carl Zeiss, Jena, 293 F. Supp. 892 (S.D.N.Y. 1968)