Lack of Actual Actual Confusion Leads to Dismissal of FICO Challenge to FIDO for Fraud Prevention Software and Services

In a 79-page opinion in this nearly eight-year-old proceeding, the Board dismissed Fair Issac's challenges to registration of the mark FIDO, finding confusion unlikely with the registered mark FICO, both marks for goods and services in the field of fraud prevention. The Board found that the differences in the marks outweighed their similarities, but most significant was the lack of actual confusion despite nine years of co-existence in the marketplace. Judge Bergsman's opinion (paper no. 172 in TTABVUE, the first 15 pages of which set out the parties' respective goods and services) runs smoothly through the DuPont factors and is well worth a read. This blog post will attempt to hit the highlights. Fair Isaac Corporation v. FIDO Alliance, Inc., Consolidated Oppositions Nos. 91225634 and 91249276 and Cancellation No. 92071706 (December 1, 2023) [not precedential] (Opinion by Judge Marc A. Bergsman).

The parties stipulated that Fair Isaac had standing to bring its claims, but the Board ruled early on that the "parties may not stipulate to a plaintiff's standing [i.e., entitlement to bring an opposition and/or cancellation proceeding] in the absence of supporting facts." The Board then found that Fair Isaac had established its "standing." Fair Isaac also proved its priority.

The Board began by noting that "[i]f confusion is likely even between just one good or service at issue in an affected International Class in an asserted registration and one good or service in an application, that is enough to sustain an opposition as to the goods or services in the affected class in the application."

However, the Board found the differences between FICO and FIDO to be "significant enough to outweigh the similarities and that the difference in the resulting commercial impression weighs against a finding that confusion is likely."

In sum, while the marks are similar in some parameters examined in the abstract, FIDO has a connotation that FICO does not and has a different second consonant sound (and may also be pronounced by some with a different first vowel sound). While each trademark case is unique and must be decided on its own facts, the evidence here calls to mind our decision in In re Reach Electronics, Inc., 175 USPQ 734 (TTAB 1972) ("'REAC' and 'REACH' are literally words apart from each other. The one letter difference referred to by the examiner is quite significant herein because 'REACH' is a commonly used dictionary word which possesses a meaning unlike 'REAC' which is and would be recognized as a play on ‘react’ or ‘reactor’. And by reason thereof, 'REACH' would be readily distinguishable from 'REAC' in appearance, and it does not sound like 'REAC' when spoken.")

As to the goods and services, the Board concluded that, although they are "related in the general sense in that they both play a role in combatting fraud, Opposer’s directly and Applicant’s indirectly," they differ in nature. Fair Isaac’s goods and services examine transactions after the fact based on data; applicant’s services "simply restrict[] access to computer systems to people in possession of particular objects or credentials (irrespective of whether the access is for the purpose of engaging in a commercial transaction or some other purpose)."

The Board applied the Mason factors in rejecting Fair Isaac's zone-of-natural expansion claim, observing that that "the claimed expansion would require technology that is different from the data-driven predictive technology that is explained in Opposer’s promotional material and referenced in the identifications of services in its registrations." 

The Board further found that, although the trade channels and classes of customers overlap, the customers for the goods and services are "quite sophisticated, careful purchasers" who are therefore "less prone to casual purchasing behavior, which in turn decreases the potential for source confusion."

[W]hile the evidence under the DuPont factor that assesses both the “buyers to whom sales are made” and also “[t]he conditions under which” those sales are made (“i.e., ‘impulse’ vs. careful, sophisticated purchasing”) pull in opposing directions, the evidence here convinces us that sophisticated purchasing is the overriding consideration. This factor, on balance, supports a finding that confusion is not likely.

Fair Isaac contended that the FICO mark is famous, but its evidence did not address the fraud prevention market, and so the Board accorded the mark "no more and no less than the normal strength accorded any inherently-distinctive registered mark."

The lack of actual confusion evidence weighed heavily against Fair Isaac. The Board deemed it "significant that two such sophisticated, large, national companies have been out in the marketplace dealing with the same types of corporate customers and, in some instances, the same companies, and yet neither is aware of any evidence that, at any time over the last nine years, any of their actual or potential customers has been confused as to the source of the parties’ respective goods and services."

The Board found DuPont factors 9-12 to be neutral. Under the 13th factor, Fair Isaac argued that applicant's adoption of the FIDO mark was in bad faith because applicant was aware that the FICO mark was well known in connection with credit scores. The Board, however, pointed out that "adoption of a mark with knowledge of a senior user’s mark, even if the senior user’s mark was listed in a trademark search, does not amount to bad faith (i.e., an intent to confuse)." 

The factor we think is most significant on the evidence and in the circumstances of this case is that there are no known instances of confusion. Also significant is the difference in the marks’ connotations and the sophistication of the corporate consumers and care that the highly-placed individuals who purchase (or, in Applicant’s case, license) the business-oriented products and services here. The fact that there is only a modest relationship between the goods and services also supports our conclusion. These factors outweigh the overlap in trade channels and customers and the modest relationship between the goods and services.

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TTABlogger comment: Looking at just the goods and services, one might have guessed that Fair Issacs would win.

Text Copyright John L. Welch 2023.