Monday, November 26, 2007

Bose Wins 2(d) "WAVE" Opposition Despite Losing One Registration to Applicant's Fraud Claim

Frequent TTAB litigant Bose Corporation lost the fraud battle but won the war in its Section 2(d) opposition to registration of the mark HEXAWAVE for various electronic devices, including amplifiers and tuners. The Board sustained Applicant Hexawave's fraud claim as to one of Bose's pleaded registrations, but denied Bose's own feeble fraud claim. The Board then went on to find the HEXAWAVE mark likely to cause confusion with Bose's famous WAVE and ACOUSTIC WAVE marks for radios, loudspeakers, and music systems that include amplifiers and tuners. Bose Corp. v. Hexawave, Inc., 88 USPQ2d 1332 (TTAB 2007) [not precedential].

Fraud: The claim of fraud against Bose centered on the renewal in 2001 of its registration for the mark WAVE for "radios, clock radios, audio tape recorders and players, portable radio and cassette recorder combinations, compact stereo systems and portable compact disc players." Bose acknowledged that it stopped manufacturing and selling audio tape recorders and players in 1996-97. Nonetheless, Bose did not delete those goods from the registration when it filed for renewal. It contended that the renewal was proper since it "continued to use its mark on the goods because owners of audio tape recorders and players continue to send their previously purchased goods to opposer for repair services and upon completion of the repair services opposer 'transports' them back to the owner." Bose also acknowledged that it did not re-label or make any alteration to the products, apart from the technical repair.

The Board noted that Bose offered no case support for its theory that "transporting" a product back to its owner after repair constitutes use of a trademark on the product as contemplated by Section 45 of the Trademark Act.

The Board pointed out that a sale of goods is not necessary to establish trademark use; shipment of samples and prototypes may suffice. However, the entity causing the shipment must be the owner of the goods at the time of transportation. Here, "the scenario presented by opposer does not constitute use sufficient to maintain a registration for goods."

The question then became "whether it was reasonable for opposer to believe that it did." The Board found that it was not, because Bose "could not point to case law that supports" its interpretation of the statute.

"[W]e do not find it reasonable to believe that an application of a mark at some point in the past to goods which have been sold, still serves to constitute use when those goods, now owned by another, are subsequently shipped again in connection with a repair service."

The Board therefore found that Bose committed fraud in maintaining its registration. [It added that if Bose should prevail on appeal, the registration would in any event require restriction to delete audio tape recorders and players]. The Board noted that Bose was still entitled to rely on its common law rights in the mark of the now-cancelled registration.

Bose's allegation of fraud was based on the claim that Applicant was not using its mark on all the goods listing in its application when Applicant filed a declaration attesting to use of the mark. Bose relied on a single interrogatory answer and a response to one document request. The Board found, however, that Bose's claim was groundless because Applicant did not say that it was not using the mark on the goods. Thus Bose failed to prove its fraud claim by the required clear and convincing evidence. [TTABlog note: another feeble fraud claim made by Bose, based on a single interrogatory response, was rejected earlier this year in Bose Corp. v. Custom Electronic Design & Installation Ass'n, Cancellation No. 92042327 (April 30, 2007) [not precedential], blogged here.]

Likelihood of Confusion: The Board began its Section 2(d) analysis by ruling that Bose's WAVE and ACOUSTIC WAVE marks are famous for radios, loudspeakers, and music systems that include amplifiers and tuners.

As to the goods, Applicant argued that its products are internal electronic components, but the identification of goods in the opposed application was not so limited. The term "amplifier" must be read to include all kinds of amplifiers, and the term "tuner" includes radio tuners. Both amplifiers and tuners are integral parts of opposer's loudspeaker and music systems. Therefore, the Board ruled, Applicant's goods are related to Bose's goods. And it further ruled that the goods of the parties must be assumed to travel in the same channels of trade to the same class of purchasers.

As to the marks, the Board found that the term WAVE "creates a similar commercial impression and evokes a similar connotation, at a minimum, when used in connection with amplifiers." Applicant's argument that the word "wave" is weak and suggestive went nowhere; "any perceived weakness due to suggestiveness is outweighed by the fame of the marks."

The Board therefore ruled that confusion is likely, and it sustained the opposition.

TTABlog comment: Given Bose's track record, one may expect an appeal in this one. The ruling against Bose on the fraud issue seems particularly precarious. There may have been no case law that supported Bose's position on the use issue, but there didn't seem to be any case law directly against Bose's position either. So didn't the Board go a bit overboard in finding this to be fraud?

Text Copyright John L. Welch 2007.


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