CAFC Affirms TTAB's MONEY MART Decision, Confirming that Zone of Natural Expansion Doctrine Applies Only Defensively

The CAFC upheld the Board's latest decision (on remand) in this long-running dispute over Dollar Financial Group's registrations for the mark MONEY MART, in standard character and design form, for loan financing and check cashing services. The appellate court ruled that the Board "correctly determined that DFG may not rely on the zone of natural expansion doctrine to establish priority and that confusion was likely with respect to DFG’s recited pawn brokerage and pawn shop services." [TTAB opinion here]. Therefore, the Board properly ordered that "pawn brokerage and pawn shops" be deleted from DFG's registrations. Dollar Financial Group, Inc. v, Brittex Financial, Inc., 2025 USPQ2 480 (Fed. Cir. March 19, 2025) [precedential].

The Board found that cancellation Petitioner Brittex had priority because it was "clearly the first to offer pawn brokerage and pawn shop services under [its] mark[]." Brittex had used the mark MONEY MART PAWN or MONEY MART PAWN & JEWELRY for pawn shop services since 1993, whereas DFG used the MONEY MART mark in connection with pawn brokerage and pawn store services only since 2012. DFG argued that it had priority because pawn shop services were within the natural zone of expansion of its loan financing and check cashing businesses that it operated since the 1980s. The Board, however, concluded that DFG could not rely on the zone of natural expansion doctrine to claim priority because the doctrine is purely defensive.

The Board then found that the DuPont factors heavily favored a finding of likelihood of confusion because the marks are "highly similar" and the parties’ pawn services overlap and travel through the same, normal trade channels to the same classes of consumers. And so, the Board partially granted Brittex's petition for cancellation, requiring (as an alternative remedy requested by Brittex) that “[p]awn brokerage and pawn shops” be deleted from DFG's registrations.

The CAFC observed that under the doctrine of natural expansion:

the first user of a mark in connection with particular goods or services possesses superior rights in the mark as against subsequent users of the same or similar mark for any goods or services which purchasers might reasonably expect to emanate from it in the normal expansion of its business under the mark. Orange Bang, Inc. v. Ole Mexican Foods, Inc., 116 U.S.P.Q.2d 1102, 2015 WL 5675641, at *19 (T.T.A.B. Sept. 10, 2015) (precedential).

The CAFC's predecessor court considered the applicability of the doctrine in Jackes-Evans Manufacturing Co.v. Jaybee Manufacturing Corp., 481 F.2d 1342, 1345 (C.C.P.A. 1973), holding that "the ‘expansion of business’ doctrine is purely a defensive doctrine.” Defensive use of the doctrine permits the senior user to prevent the junior user’s registration of a similar mark on logically related goods. Id. But the doctrine does not give the senior user the right to "offensive use," i.e., the "right to register [a] mark on an expanded line of goods where the use of the mark covered by such registration would lead to a likelihood of confusion, mistake or deception." Id. [Emphasis added].

DFG could have properly invoked the zone of natural expansion in a defensive manner had Brittex attempted to register its MONEY MART mark in connection with pawn services in the 1990s and DFG opposed that registration. *** But the doctrine may not be used offensively to establish priority in the manner DFG suggests because that would essentially grant DFG the right to register its mark on a line of expanded goods, even though it would likely cause confusion with Brittex’s established common law rights.

The appellate court then considered the Board's Section 2(d) analysis. It found that the Board properly assessed the strength of Brittex's marks, that substantial evidence supported the finding that DFG's marks "are highly similar to Brittex’s marks in appearance, sound, connotation, and commercial impression," and that the remaining applicable DuPont factors were neutral.

Concluding that the Board did not err with respect to its priority analysis and that substantial evidence supported the Board’s determinations for each disputed DuPont factor, the CAFC affirmed

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TTABlogger comment: Is there anything new here? If the doctrine were available offensively, wouldn't that be tantamount to reserving a right to register? 

Text Copyright John L. Welch 2025.