How are international trademarks treated? I want to name my business the identical name as an English franchise. Is this ok?

1. Well, they do a pretty comprehensive search — whether or not the other company’s name will come up I don’t know.
2. Yes.
3. Possibly.
4. Depending on the scope of their business and intellectual property rights they may be able to sue you in the US.

You really should speak with a trademark attorney — this scenario is fraught with pitfalls and it is not worth your time, effort, and money to pursue something that may be a losing battle for you.

I agree with my colleague, the idea is to avoid these type of disputes not set yourself up for a problem down the road. Since you already know about the problem, why not try altering the name a bit or get another name altogether.

The below does not constitute legal advice, does not form an attorney-client relationship, and should not be relied upon to take or refrain from taking any action.

1. When the USPTO looks at my application, do they also look at other countries trademarks?
No.

2. If I am approved, can this company in England come after me later if they want to?
Depends. If the English company has developed trade name or trademark rights in its business name within the US through the use of its name in the US then it can bring suit against you in the US. But if the English company has never used its company name in the US then it has no trade name or trademark rights in the US (even if the name is well-known in England). Under US law trademark rights are territorial -- which means that the scope of rights in a mark reaches only into the countries where the mark is actually being used. If you're interested read this case: http://tr.im/mY0F (note that after the case was decided the NY courts also concluded there is no “famous marks” doctrine under NY law).

3. If this company wants to file a trademark 2 years from now, will they have priority of use?
Not if someone in the US begins to use the same mark on related goods or services first.

4. Is it possible for a company to sue me abroad; is this something I can ignore?
If you're offering goods or services for sale abroad (even via the internet) then you're susceptible to suit abroad. The issue is whether a foreign judgment against you is enforceable in the US. The answer would depend on lots of facts -- not the least of which is the amount of business you're doing in the country that issued the judgment. If none, then the foreign judgment is likely not enforceable in the US.

Any other possible future problems?
Lots. Especially since you're "being forced to change my bus. name or face a lawsuit." Speak to a trademark lawyer.

I agree in principle with my two colleagues who have already responded, to the extent that they urge you to consult an attorney experienced in trademarks and that they suggest being cautious in any conflict-ridden situation. But I must differ with some of their comments.

Trademark law still operates on a jurisdiction-by-jurisdiction basis, known as the "territoriality principle." In general, companies are not automatically precluded from adopting for a local service a trademark that's close to an existing trademark for a similar service in a faraway jurisdiction.

To go through your items in order:

1. When an examining attorney at the USPTO reviews an application, s/he generally does not search for trademarks registered outside of the U.S.

2. In some jurisdictions, a mark used in a foreign country that has become famous gives the original user certain rights against a company that subsequently adopts the trademark in that jurisdiction for similar goods or services. But is the United States one of those jurisdictions? Well, these days it depends on whom you ask. If you ask the USPTO, the answer as of today is NO. I say that because just two months ago, the trademark appeal board at the USPTO held that a foreign company that used abroad the trademark FLANAX for naproxen wasn't entitled to cancel the federal trademark registration of a company that later had adopted the term for similar product here. The first user in the U.S. was entitled to the trademark, they held. (See attached link.)

But if you ask the U.S. Court of Appeals for the federal circuit that includes California, the Ninth Circuit, you'd get the opposite answer. In 2004, they held that a Mexican supermarket chain named Gigante could preclude a California company from adopting the same name. (See attached link.)

And yet the U.S. Court of Appeals for the Second Circuit (which includes New York), would agree with the recent holding of the USPTO board. After consulting the New York Court of Appeals as to the existence of the "famous marks doctrine" under New York Law, the Second Circuit held that the BUKHARA restaurant in New York could keep its name, even though the challenger had been using the same name in India for years. (See attached link.)

3. The answer depends on the specific facts as well as on whether the courts reexamine in the interim the conflicting determinations on doctrine. But for the moment, the FLANAX decision would be applied at the USPTO.

4. Again, the answer would depend on the specific facts at the time of suit. First would be the question of whether any actions of the defendant business subjects it to the jurisdiction of a foreign tribunal. In the situation you describe, usually the answer is NO. But sometimes advertising on the Internet can be so pervasive that a foreign court would nevertheless assert jurisdiction. Second would be whether the foreign court, applying the principles of "conflicts of laws," would be likely to find the defendant to have acted in a way that gives rise to a legal remedy.

All of this is to say that you have asked an interesting question that doesn't have a settled answer at this time.

My comment, of course, is not a substitute for legal advice rendered by competent counsel whom you engage to evaluate confidentially the facts and law applicable to your particular situation.