Wednesday, May 05, 2010

TTAB Finds "SMIC" And "TSMC" Wafer Grid Logos Confusingly Similar for Identical Goods and Services

The Board sustained a Section 2(d) opposition to registration of the mark SMIC & Design [below left] for semiconductors, integrated circuits, and parts and packaging therefor,and for custom manufacture and design thereof, in view of the registered mark TSMC & Design [below right] for semiconductors and integrated circuits and their custom manufacture and design. Despite the sophistication of the purchasers, the Board concluded that, given the identical goods, services and trade channels, the similarity of the marks, and the renown of opposer’s marks, confusion as to source is likely. Taiwan Semiconductor Manufacturing Co., Ltd. v. Semiconductor Manufacturing International (Shanghai) Corporation, Oppositions Nos. 91171146 and 91171147 (April 23, 2010) [not precedential].

Opposer Taiwan was founded in 1987 as the world's first dedicated semiconductor foundry, and remains the world's largest. It has used its mark since 1988 and spends more than $1 million per year in advertising and promotion. The value of its brand TSMC is estimated to be $10 billion. The Board concluded that the mark "has achieved a high degree of public recognition and renown."

The Board found the goods and services of the parties to be identical, and that they would be marketed in identical trade channels to identical classes of customers.

Turning to the marks, the Board pointed out once again that when the involved goods and services are identical, a lesser degree of similarity is required to support a finding of likely confusion. It deemed the "most prominent features" of both marks to be "the imagery of a circular wafer grid combined with the placement of multiple letters across the center of them."

In both marks, the circular wafer design has a solid line outer boundary and is subdivided into small rectangular or square sections. Both marks contain four initials vertically centered over the circular wafer element, with the first and final letters of both the letters TSMC and SMIC extending beyond the outer boundary of the wafer element. Of the respective four-letter initialisms of the parties, they each contain three of the same letters (“S,” “M” and “C”). And finally, the same three letters are presented in exactly the same order.

The Board observed that, according to CCPA precedent, "arbitrary arrangements of letters should be given a wide scope of protection, given that the recall among purchasers is often hazy and imperfect under these circumstances." While both marks are abbreviations for the company names, the letter combinations have to be viewed as arbitrary when used as marks.

The Board found that the marks are similar in appearance, as well as in connotation (since both letter combinations are arbitrary). They are pronounced differently, but that is not enough to avoid confusion.

And the Board agreed with Opposer that the cumulative effect of several characteristics of the marks create a similar commercial impression.

And so the Board found that the similarities in the marks outweigh their differences.

Applicant pointed to a number of examples of use of "wafer" designs in marks in the field of semiconductor fabrication and related fields, but the Board found the value of that evidence to be "severely limited." In most of the marks, the lettering is not centered over the wafer, many of the marks include other distinctive matter, some are not acronyms, and none of the companies involved appear to be direct competitors of the parties.

Although the customers for the involved goods and services are sophisticated, that does not make them immune from source confusion, particularly "when, as here, the respective branding devices ... are so very similar in overall commercial impressions." At best, this factor is neutral.

Applicant pointed to the lack of actual confusion, but the Board noted that lack of actual confusion carries little weight. In any case, Applicant did not provide revenue figures for the USA alone,and so it may be that Applicant has not made significant use of its mark in this country.

Finally, the Board looked to the 13th du Pont factor: "Any other factor probative of the effect of use." It focused on Applicant's intention in adopting its mark, noting that "[t]o the extent that the issue of likelihood of confusion is not free from doubt, we find it appropriate to look to applicant's intention."

The history of litigation between the two companies showed that Applicant "has been complicit in multiple attempts to misappropriate and infringe opposer's intellectual property rights. "Applicant's actions ... demonstrate a history of blatant disregard for opposer's intellectual property rights.' [The Board noted, however, that its decision "does not rely on" this particular du Pont factor.]

And so the Board sustained the opposition.

TTABlog comment: Clearly, the Board thought Applicant was a really bad actor. Putting that aside, do you think the marks are confusingly similar? I don't. I think the differences in the marks, coupled with the sophistication of the purchasers, should yield a finding of no likely confusion.

Text Copyright John L. Welch 2010.


At 8:21 AM, Blogger Frank said...

I agree with your conclusion. What I don't understand is why the TTAB doesn't have the integrity to come right out and say it. Without that understanding of the context of this opinion, people would be lead to believe that SMIC and TSMC are really similar marks.

At 11:26 AM, Anonymous Anonymous said...

This is just another case where if you are the biggest in your respective industry, the Board will give you the store. For example, take a look at the decision and examiner's brief in In re Mittal Steel Techs. Ltd., 2008 TTAB LEXIS 470 (TTAB 2008).

At 11:37 PM, Blogger Pamela Chestek said...

Not so similar as word marks, but I think the combination of the very similar design component with some similarity in initials tips it into likelihood of confusion. The applicant might have been better off filing for the word only.

At 2:18 PM, Blogger Catherine said...

I agree that the dispositive factor for the board was probably the bad intent of the junior user in adopting such a similar design from the universe of possible designs. After all, intentional infringement is generally presumed to be successful, hence likelihood of confusion. But it would have been helpful for TTAB to acknowledge this reasoning rather than hang it all on a rather tortured DuPont analysis.

At 12:54 AM, Anonymous Rob said...

The CAFC really needs to revisit DuPont. This 37 year-old CCPA case outlines "tests" that have turned out to be too broad, vague, and numerous to provide any useful guidance on Section 2(d).


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