gray market goods

Foreign-manufactured goods, bearing a valid United States trademark, that are imported without the consent of the U.S. trademark holder. The gray market arises in three general contexts. In the first case, despite a domestic firm's having purchased from an independent foreign firm the rights to register and use the latter's trademark as a U.S. trademark and to sell its foreign manufactured products here, the foreign firm imports the trademarked goods and distributes them here, or sells them abroad to a third party who imports them here. In the second case, domestic firms register the trademark in the U.S. for goods which are manufactured abroad by an affiliated manufacturer. The foreign affiliate may be a subsidiary of the U.S. firm, the parent company or an unincorporated manufacturing division of the U.S. firm. The gray market arises when the trademark holder or its foreign affiliate sells trademarked articles overseas which are then imported into the U.S. by a third party without authorization of the U.S. trademark holder. In the third case, the domestic holder of a U.S. trademark authorizes an independent foreign manufacturer to use that trademark in a particular foreign location. The foreign manufacturer or a third party then imports and distributes the foreign made goods. K Mart Corp. v. Cartier, Inc., et al., 486 U.S. 281, 108 S.Ct. 1811, 100 L.Ed.2d 313