Tuesday, May 22, 2012

Opposer Dodges Fraud Counterclaim, But Purchaser Care and Lack of Actual Confusion Lead to TTAB Dismissal

In a 63-page decision, the Board dismissed a Section 2(d) opposition to registration of the mark BENCHMARK RELIANCE for the "issuance and administration of annuities," finding it not likely to cause confusion with the registered mark RELIANCE STANDARD for insurance underwriting and issuing and administering annuities. Despite a partial overlap in the involved services, the Board was persuaded to rule in Applicant's favor by the high degree of care exercised by consumers, the lack of any reported instances of confusion, and the differences in the marks. But the Board denied Applicant's counterclaim for fraud predicated on false statements made by Opposer to the USPTO to overcome a refusal to register. Reliance Standard Life Insurance Company v. American National Insurance Company, Opposition No. 91178996 (April 30, 2012) [not precedential].

Fraud counterclaim: During prosecution of its application to register RELIANCE STANDARD, Opposer sought to overcome a Section 2(d) refusal by stating that it offered its annuity services to employers. But it failed to state that it also sells annuities to individuals through independent agents and brokers. In short, Opposer told a "half-truth."

Opposer did not contest the fact that it knew it rendered its annuity services to individuals. Although the false statements at issue were attorney argument, a client is bound by the actions of its attorney. In any case, Opposer's officer advised counsel in preparing the argument.

The statements were material because they formed "the basis of opposer's contention that its services and the services in the cited registration move in different channels of trade and are sold to different classes of consumers." The false statements "presumably led the examining attorney to withdraw the likelihood of confusion refusal and approve opposer's application for publication."

The Board, however, had doubts as to whether Opposer intended to deceive the PTO. Although "our experience tells us that opposer intended to mislead the examining attorney" by its statements, Opposer did submit a specimen of use that stated that it "offers a complete portfolio of fixed rate annuity products to individuals." The Board must presume that the Examining Attorney was aware of that statement in the specimen of use. Consequently the Board could not "logically find that there was a willful withholding of facts which, if transmitted and disclosed to the examining attorney, would have resulted in the disallowance of the registration sought by opposer." In short, Applicant failed to prove fraud by clear and convincing evidence.

Likelihood of confusion: Opposer attempted to rely on its common law rights in the stand-alone mark RELIANCE, but it failed to meet its burden to prove priority of use. The Board then focused on Opposer's registered mark RELIANCE STANDARD.

The Board found that, based on the nature of an annuity, the personal interaction between the buyer and seller, and the cost of the premium, annuities are purchased "only after careful consideration by the relevant consumers with specific consideration give to the identity and reputation of the annuity underwriter."

The involved marks have been in concurrent uses for nearly seven years for individual annuity services sold in the same channels of trade to the same classes of consumers. The sales and marketing expenditures of the two companies was "substantial enough" for the Board to concluded that there has been a reasonably opportunity for confusion to have occurred. The lack of actual confusion therefore weighed in Applicant's favor.

Finally, as to the marks, the Board found that, despite the fact that the marks have similar meanings and engender similar commercial impressions, the differences in the marks outweigh their similarities. In sum, the Board found the marks "not similar."

Balancing the du Pont factors, the Board ruled that there is no likelihood of confusion between the marks at issue.

TTABlog comment: Note that even if Opposer's registration had been cancelled, it still had common law rights in the RELIANCE STANDARD mark.

Text Copyright John L. Welch 2012.


At 10:00 AM, Blogger Robert said...

Wow. I thought the TTAB's previous fraud standard was too loose, but now it seems too tight. The TTAB can find that an applicant has knowingly made a false material statement and characterize it as misleading. Yet there is no intention to deceive?! Why? Because the applicant submitted a specimen with the original application nearly a year before the misleading statement that accurately described its services. This approach seems to hold that forgetful liars lack the intent to deceive.

At 3:15 PM, Anonymous John said...

So, along that same fraud discussion, would an applicant be found to meet the fraud standard by filing a "serial number --------- should not be used as a citation(s) under Section 2(d) of the Trademark Act because the applicant herein claims ownership of the referenced serial number(s)" statement via TEAS, even though he does not own the cited mark? That cited mark stands as a bar to his registration due to priority, so it APPEARS as though he is trying to "game" TEAS.

At 5:41 PM, Anonymous Anonymous said...

That is incredible.
you simply can't get the Board to find that someone has committed fraud. They are just not going down that road post Bose.
What a sad commengtary that we have lawyers so lacking in ethics filing documents with the USPTO with an intent to defraud the Office and what is worse that there is no penalty for doing so. Why is this profession such a hopeless mess? This decision sums it up. Lie, cheat and steal just argue that you really didn't intend to and we'll let you go.

At 10:05 PM, Blogger Pamela Chestek said...

Fraud in obtaining a registration may make the mark unenforceable altogether, at least in South Carolina. See Firehouse Restaurant Group, Inc. v. Scurmont LLC, Civil Action No. 4:09-cv-00618-RBH (D.S.C. Oct. 17, 2011), post at http://www.propertyintangible.com/2011/10/how-damaging-to-your-case-is-cancelled.html.

At 8:48 AM, Blogger Robert said...


I would hope the TTAB would consider your example of falsely claiming ownership of prior registrations or applications as fraud. Unlike the case discussed here, there is no evidence on record that explicitly contradicts the false claim. Because fraud has a higher burden of proof, the specimen apparently created just enough doubt (the applicant was stupid?) to allow the TTAB to avoid a finding of fraud. Your example lacks even that fig leaf; the absence of evidence is not the same as evidence of absence. At least one would hope the TTAB would so find.

At 10:12 AM, Blogger John L. Welch said...

For the sake of clarity, the commenter named "John" was not me.

At 10:20 AM, Blogger Robert said...

The TTAB's fraud analysis is curious for another reason. It looked at the entire application record, which by itself is unremarkable. However, to avoid a finding of intent, it placed great weight on evidence consisting of a specimen that was submitted with the original application nearly a year before the applicant knowingly made the materially false statement.
I am not sure that the specimen should be accorded much weight on the issue of intent under those circumstances. The specimen was provided for the limited purpose to support the applicant’s actual use basis, not to prove use on each and every service. Moreover, the occasion prompting the misleading statement was the examining attorney’s refusal to register due to likelihood of confusion; this happened after the specimen was submitted. Presumably the applicant would form the deceptive intent after the refusal absent any evidence that the refusal was anticipated.
Does anyone really think that the applicant decided that it would argue for different classes of consumers forgetting that both parties targeted individuals? The TTAB did not believe that. Or is it more likely that the applicant made the argument with false statements forgetting that the specimen it submitted 11 months earlier contradicted it? This seems intuitively the more likely prospect. It seems more likely that if the applicant anticipated the refusal and had an innocent intent, it would have omitted the overlapping services directed toward individuals or else deleted them as part of its response. However, the TTAB did not find this logic sufficient to meet the burden for clear and convincing evidence.
If the TTAB gives all evidence on the record equal weight, parties will have a rather heavy burden to show that an applicant formed a deceptive intent triggered by occasion after an application was filed. Fortunately the TTAB’s decision is not precedential, and so perhaps we will get a better decision.


Post a Comment

<< Home