Tuesday, February 16, 2010

TTAB Finds Service Mark Application Void ab initio for Non-Use Because Services Were Not Rendered Prior to Filing

When an applicant files a use-based application but has not used the mark for any of the identified goods or services, the application is void ab initio. There's no need for the adversary to jump through the fraud hoops: intent doesn't matter. Here, the question was whether PLMIC had used its service mark prior to filing its application. The Board said no: PLMIC may have been "ready, willing, and able" to render the services, but it didn't do so before the filing date. Parametric Technology Corporation v. PLMIC, LLC, Opposition No. 91174641 and PLMIC, LLC v. Parametric Technology Corporation, Opposition No. 91177168 (February 12, 2010) [not precedential].

In this consolidated proceeding,Parametric attempted to raise a fraud claim but failed to plead it with the requisite particularity. However, the Board did find that Parametric presented a claim of non-use: that PLMIC's application is void because the mark was not "put into use" in commerce until after PLMIC filed its application.

Parametric also asserted likelihood of confusion under Section 2(d), claiming to be the prior user of the mark FLEXPLM for computer software and related services in the field of product design. PLMIC sought to register the identical mark for overlapping services, and opposed Parametric's application, claiming priority of use. There was no dispute as to likelihood of confusion.

Application void ab initio: PLMIC filed its application on March 13, 2006. It admitted that its first consummated sale of FLEXPLM services did not occur until September 2006, but it asserted that certain activities in March 2005 constituted "use in commerce:" it posted the mark FLEXPLM on the Internet "as an advertisement of 'already-available' services and [attempted] to sell, within March 2005, those services to AimNet."

However, the Board found that these activities, including the attempt to sell the services to a single potential purchaser "simply do not constitute 'use in commerce' as defined under the Act."

While such activities may constitute the advertising and promotion of PLMIC’s services, they do not encompass the rendering of those services. In that regard, the record reflects that PLMIC’s first technical service mark use in commerce in connection with its cooperative advertising and marketing services was when they were rendered to Management Roundtable in September 2006, almost one and one-half year after PLMIC’s activities of March 2005 and almost six months after the filing date of the PLMIC’s involved use-based application.

The Board therefore concluded that, because PLMIC was not rendering its services at the time it filed its use-based application, the application is void ab initio.

Likelihood of Confusion: For the sake of completeness, the Board also considered Parametric's Section 2(d) claim. For that purpose, it assumed that PLMIC's application is valid and that it had made use of its mark as of the filing date. Parametric proved first use its mark on May 26, 2005, prior to PLMIC's filing date (which is the earliest date on which PLMIC is entitled to rely).

The Board then looked at whether, for purposes of priority on PLMIC's opposition, PLMIC's activities in March 2005 (while not technical trademark use) constituted use analogous to trademark use. The Board concluded that PLMIC's evidence fell "far short of establishing that potential purchasers make an association in their minds between the FLEXPM mark as a source indication and PLMIC's cooperative advertising and marketing services."

In sum, because PLMIC did not establish that it had made trademark use or use analogous to trademark use prior to either May 26, 2005, when PTC commenced use of its mark, or the July 13, 2006 filing date, we find that PLMIC failed to establish the requisite priority. Accordingly, it cannot succeed on its Section 2(d) claim.

And so the Board sustained Parametric's opposition and dismissed that of PLMIC.

TTABlog comment: I found the Board's discussion of priority in the two oppositions rather murky. Why was PLMIC's claimed "use analogous to trademark use" irrelevant with respect to Parametric's opposition?

Text Copyright John L. Welch 2010.


At 8:58 AM, Anonymous Alex Butterman said...

Something is striking me as a little strange with the procedure in this opposed application. Because if an application is filed based upon use but it is established during examination that the evidence does not support use of the service mark either before the application was filed or after, the applicant maintains the option to substitute the use basis for an intent to use basis. See TMEP Sec. 806.03(c)("Amendment From §1(a) to §1(b)"):

In an application filed under §1(a), if the §1(a) basis fails, either because the specimens are unacceptable or because the mark was not in use in commerce when the application was filed, the applicant may substitute §1(b) as a basis. THE USPTO WILL PRESUME THAT THE APPLICANT HAD A CONTINUING VALID BASIS, in that the applicant had at least a bona fide intention to use the mark in commerce as of the application filing date. 37 C.F.R. §2.35(b)(3).

When amending from §1(a) to §1(b), the applicant must submit a verified statement that the applicant has a bona fide intention to use the mark in commerce on or in connection with the goods/services, and that the applicant had a bona fide intention to use the mark in commerce on or in connection with the goods/services as of the application filing date. 15 U.S.C. §1051(b)(3)(B); 37 C.F.R. §2.34(a)(2)...(emphasis added).

As such, the application should not have proceeded to publication if it was only a use-based application and there was no adequate use of the mark. Either the examiner did not issue the necessary specimen refusal or was unable to because not having enough adequate resources to challenge applicant and establish that the service mark was not yet in use. But if the application had not yet been published, the application would not necessarily be void ab initio because the applicant should have had the opportunity to substitute the filing basis. Alternatively, the Board could have held the applicant intended to commit fraud upon obtaining approval of the use-based application.

In any event, after the application was published, the applicant probably was inevitably in trouble if adequate evidence of use before the filing date did not exist.

At 10:19 AM, Anonymous Orrin A. Falby said...

Alex, not sure why any of what you just stated matters. The applicant submitted a specimen of use that was acceptable under the rules. The EA will not question the validity of a specimen that appears appropriate on its face. Nothing strange here.

There is an important lesson here though. When acquiring trademark assets, DO YOUR DUE DILIGENCE!!

At 11:38 AM, Anonymous Anonymous said...

Another reason to file as ITU if there is any question as to use.

At 1:17 PM, Anonymous Rob said...

If that is the case, then why wouldn't an ITU be similarly void ab initio under §1(b) if there is no intent to use all of the goods/services specified?

It seems the TTAB is trying to circumvent Bose (since fraud is going to be a lot harder to prove now,) by expanding the applicability of the void ab initio doctrine to other grounds for refusal. Which is not a bad thing, considering that the effect of void ab initio is class-wide, but not application-wide.

At 2:16 PM, Blogger John L. Welch said...

I don't think there was any question about this applicant's intention to use the mark. He just didn't have technical trademark use.
Cases like Honda v. Winkelmann show that if an applicant does not have a bona fide intent, the application is void.
The Board has held that fraud applies only class-by-class. See G&W Laboratories, Inc. v. G W Pharma Limited, 89 USPQ2d 1571 (TTAB 2009) [precedential].


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