Tuesday, January 22, 2013

The Top Ten TTAB Decisions of 2012 [Part One]

Once again, yours truly, the TTABlogger, has fearlessly chosen the ten TTAB decisions that he considers to be the most important and/or interesting from the previous calendar year. All but one of the chosen decisions are precedential. [This is the first of two posts, the first five entries being set out below, preceded by a few introductory paragraphs. Additional commentary on each case may be found at the linked TTABlog posting].

The issue of fraud continues to tread water at the TTAB. Not a single fraud claim has been sustained by the Board since the CAFC issued its Bose decision in August 2009. In the one precedential ruling that mentioned a fraud claim [ShutEmDown Sports v. Lacy, below], the Board ducked the issue entirely by choosing to base its ruling on the unpleaded ground of nonuse. Nonetheless, claims of fraud are frequently made, perhaps because of their in terrorem effect on the accused party.

Although fraud may be in the TTAB doldrums, dilution-by-blurring has been making waves in the TTAB pool. In 2011, the Board relaxed its requirement that a plaintiff show that the marks at issue are identical or substantially similar in order to win a dilution claim, but it tightened its focus on proof that any association between the marks will cause a diminution of the distinctiveness of the famous mark. The net result may do little to reduce the uncertainty of success when a trademark owner pursues a dilution claim.

The issue of bona fide intent, or lack thereof, seems to be surfacing with increasing frequency. In one significant decision [L'Oreal v. Marcon, below], the Board found a lack of bona fide intent based in part on the applicant’s history of filing intent-to-use applications for the famous marks of others, but never using the marks.

Section 2(b) cases are rare indeed, but a pair of TTAB decisions applied this statutory bar according to its express terms in affirming refusals to register the official seals of two municipalities. [District of Columbia and Houston, below]. In an inter partes decision, the Board likewise declined to look beyond the statutory language of Section 43(c)(6) - despite general agreement that the language resulted from a “clerical error” - in dismissing a dilution claim in view of the "federal registration defense." Academy of Motion Picture Arts and Sciences v. Alliance of Professionals & Consultants, Inc., 104 U.S.P.Q.2d 1234 (TTAB 2012).

In other TTAB rulings of particular interest, the Board clarified the nature of the proofs necessary to establish that a mark is primarily geographically deceptively misdescriptive under Section 2(e)(3). [Corporacion Habanos, below]. It affirmed the USPTO’s refusal to allow amendment of the mark GOT STRAPS to add a question mark because that change would constitute a material alteration under Trademark Rule 2.72(b)(2). In re Guitar Straps Online, LLC, 103 U.S.P.Q.2d 1745 (TTAB 2012). The Board confirmed that the owner of a Section 66(a) registration is subject to the same treatment and conditions as any other federal registrant. [SaddleSprings, below]. It explained the difference between a claim for partial abandonment under Section 14 and a request for modification or restriction of a registration under Section 18. Johnson & Johnson v. Obschestvo s Ogranitchennoy; Otvetstvennostiu WDS, 104 U.S.P.Q.2d 2037 (TTAB 2012). And it invoked the catch-all 13th duPont factor in two cases, once in an inter partes context in considering an applicant’s bad faith intent to cause, and profit from, consumer confusion [Edom Laboratories, Inc. v. Lichter, 102 U.S.P.Q.2d 1546 (TTAB 2012)], and once in an ex parte context, taking into account an applicant’s ownership of a registration for the plural version of the mark it sought to register [In re Strategic Partners, Inc., 102 U.S.P.Q.2d 1397 (TTAB 2012)].

In perhaps the most noteworthy ruling in the procedural realm, the Board precluded the trial testimony of a party's only witness because the party had failed to identify her in its initial disclosures or discovery responses, while the only witness the party had disclosed had left the company. [Spier v. Shepher, below].

In CAFC decisions of note, a divided panel blessed the Board’s approach to Section 2(e)(5) functionality: weighing the functional and non-functional features of a product design against each other in order to determine whether the design is de jure functional. In re Becton, Dickinson and Co., 102 U.S.P.Q.2d 1372 (Fed. Cir. 2012). In yet another Section 2(e)(3) decision, the appellate court affirmed the Board’s ruling that goods do not originate in Paris just because the designer of the goods had significant ties to that city. In re Miracle Tuesday, LLC, 104 U.S.P.Q.2d 1330 (Fed. Cir. 2012). And the CAFC applied its recent Citigroup ruling in an ex parte context, rejecting again the Board’s "reasonable manners" analysis when considering variations of a standard character mark. In re Viterra Inc.., 101 U.S.P.Q.2d 1905 (Fed. Cir. 2012).

The Board’s total output of 42 precedential decisions in 2012 [see TTABlog list here] was a slight increase from 2011, but still a marked decline from the average of 56 for the previous five-year period. Perhaps the addition of five new judges in 2012 will yield more decisions, and more precedential decisions, in 2013.


L’Oreal S.A. v. Marcon, 102 U.S.P.Q.2d 1434 (TTAB 2012) [precedential]. The fame of the marks L’OREAL and L’OREAL PARIS for cosmetics and personal care products was a major factor in the Board’s sustaining opposer’s Section 2(d) claim in this opposition to L’OREAL PARIS for “aloe vera drinks.” As to the claim that applicant lacked a bona fide intent to use the mark, applicant’s pattern of filing ITU applications for disparate goods under the well-known or famous marks of others was a basis for sustaining that claim. The Board found opposer’s marks to be famous based on billions of dollars in sales, significant market share, huge advertising expenditures, extensive media exposure, impressive brand awareness, and consistent high ranking by Business Week. The marks are obviously identical and, while at first glance cosmetics and beverages “might not appear to be inherently related,” opposer submitted “substantial evidence to show several reasons for finding such goods to be related;” for example, companies have marketed cosmetics and beverages under the same mark. Marcon’s history of filing applications for products for which he had no relevant experience convinced the TTAB that adoption of this mark was in bad faith, although the Board observed that even without bad faith it would still find confusion likely.

In re The Government of the District of Columbia, 101 U.S.P.Q.2d 1588 (TTAB 2012) [precedential]; In re City of Houston, 101 U.S.P.Q.2d 1534 (TTAB 2012) [precedential]. Facing an issue of first impression, the Board, in District of Columbia, affirmed the USPTO’s refusal to register the mark shown below left, on the ground that the mark comprises a governmental insignia that is barred from registration by Section 2(b) of the Lanham Act. Applicant sought to register its official seal for various goods, including clocks, cufflinks, and clothing items. Section 2(b) prohibits registration of any mark that “consists of or comprises the ... insignia of ... any State or municipality ....” There was no dispute that the applied for mark is applicant’s official seal, nor that the District of Columbia qualifies as a “municipality” under the Act. The Board found the language of Section 2(b) to be “plain and clear on its face.” Applicant argued that Section 2(b) should be interpreted to include an exception for governmental entities seeking to register their own insignia, but the Board noted that such an exception is absent from the statutory text, and it refused to presume that Congress intended such an exception.

In Houston, the Board followed its decision in District of Columbia, affirming a Section 2(b) refusal to register the official seal of the City of Houston for various municipal services. The Board distinguished its ruling in In re U.S. Dep’t of the Interior, 142 U.S.P.Q. 506 (TTAB 1964), where it reversed a refusal to register a logo of the National Park Service. There, the question was whether the logo was an official insignia falling with Section 2(b), i.e., was it “of the same class as the flag or coats of arms of the United States.” Once it is determined that the mark does fall with the Section 2(b) prohibition, then the goods or services identified in the application to register are irrelevant. Here, the City of Houston’s seal is admittedly an official insignia under Section 2(b), and applicant’s discussion of the particular government-related services recited in its application is of no consequence.

ShutEmDown Sports, Inc. v. Lacy, 102 U.S.P.Q.2d 1036 (TTAB 2012) [precedential]. The Board shut down applicant Carl Dean Lacy in this cancellation proceeding involving his registration for the mark SHUT IT DOWN for 113 clothing items. Petitioner alleged abandonment and fraud, asserting that at the time of filing, Lacy had yet to use the mark on any of the goods and that any subsequent use of the mark had been abandoned. The Board granted the petition on the ground of abandonment, ruled that the registration was void ab initio for nonuse – a ground that was not pleaded – and declined to consider the fraud issue. Lacy admitted that he did not use the mark in connection with 109 of the identified goods, and had no intention to do so. He therefore failed to rebut the statutory presumption of abandonment that arises after three years of nonuse. As to the remaining four items that Lacy claimed to have sold, the lack of sales for a five-year period, coupled with his lack of documentation, established a prima facie case of abandonment. The Board found it unnecessary to reach petitioner’s fraud claim because petitioner had made a prima facie case that Lacy had not used his mark on any of the goods at the time he filed his application, and Lacy failed to overcome that showing. The Board therefore ruled that Lacy’s application was void ab initio for nonuse.

Spier Wines (PTY) Ltd. v. Shepher, 105 U.S.P.Q.2d 1239 (TTAB 2012) [precedential]. Spier Wines noticed the testimony deposition of one witness, Ms. Eve Jell, but not until its pre-trial disclosures was she first identified as a potential witness. Spier’s initial disclosures had identified a person who had subsequently left the company. Applicant Shepher moved to strike the pre-trial disclosures and to quash the notice of taking testimony due to Spier’s failure to timely identify Ms. Jell in a supplement to its initial disclosures or otherwise. The Board granted the motion. It weighed the five factors set forth in Great Seats, Inc. v. Great Seats, Ltd., 100 U.S.P.Q.2d 1323 (TTAB 2011), concluding that the failure to identify Ms. Jell was neither harmless nor substantially justified. “Essentially, opposer treated the initial and pretrial disclosure requirements as unrelated events, rather than recognizing that disclosures and discovery responses should be viewed as a continuum of inter partes communication designed to avoid unfair surprise and to facilitate fair adjudication of the case on the merits.” Consequently, the Board applied the “estoppel sanction” and precluded the testimony of Ms. Jell.

SaddleSprings, Inc. v. Mad Croc Brands, Inc., 104 U.S.P.Q.2d 1948 (TTAB 2012). [precedential]. The Board denied respondent’s Rule 12(b)(6) motion to dismiss this petition for cancellation of a Section 66(a) registration (a/k/a Madrid Protocol extension of protection). Petitioner alleged that the subject mark had been abandoned, but respondent asserted that because the corresponding International Registration is still viable, the registration cannot be cancelled under Section 14. Respondent contended that its registration is subject to Section 71 of the Trademark Act, 15 U.S.C. Section 1141k, which states that “an extension of protection remains in force for the term of the international registration, except that the Director may cancel the extension if the affidavit required by Section 1141k is not timely filed.” Consequently, according to respondent, the Director has no authority to cancel its registration prior to expiration of the grace period for filing a declaration or affidavit of use - i.e., prior to six years and six months after the registration issued on February 20, 2007. The Board, however, ruled that “an owner of a Section 66(a) registration is subject to the same treatment and conditions which prevail in connection with any other registrant. *** [T]his includes the possibility that the registration may be cancelled on any available ground under Section 14 of the Trademark Act, 15 U.S.C. § 1064."

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Text Copyright John L. Welch 2012-2013.


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