Japan Telecom, Inc., a California Corporation v. Japan Telecom America Inc.

Japan Telecom, Inc. (“Japan Telecom”) sells and installs telephone and computer networking equipment in the Los Angeles area. Japan Telecom is a California corporation, and a subsidiary of Hasegawa Company, Ltd., a small Japanese corporation. After Japan Telecom had been in business for fourteen years, a new kid on the block showed up: Japan Telecom America, Inc. (“Japan Telecom America”). Japan Telecom America is the United States subsidiary of Japan Telecom Company, Ltd., the third-largest telecommunications company in Japan. While Japan Telecom’s business mostly involves the installation of telephone and computer networks, Japan Telecom America sells telecommunications transmission services, including both long-distance telephone and data.

Japan Telecom sued Japan Telecom America in federal court, alleging that Japan Telecom America’s use of the “Japan Telecom” name constituted trademark infringement and unfair competition. Later, Japan Telecom sued Japan Telecom America in California state court for unfair competition and trade name infringement on the same theory. Japan Telecom America removed the state suit to federal court, and the district court consolidated the…