Tuesday, May 30, 2017

CAFC Reverses TTAB's INSIGNIA Decision, Remands for Consideration of Section 2(d) "Fame"

In a brief, Per Curiam opinion, the CAFC vacated the Board's decision of July 6, 2015 (here) dismissing a petition for cancellation of a registration for the mark ALEC BRADLEY STAR INSIGNIA, in standard character form, for "cigars, tobacco, cigar boxes, cigar cutters and cigar tubes." The Board had found that respondent's mark was not likely to cause confusion with petitioner's registered mark INSIGNIA for wines. Concluding that the Board had applied an "incorrect standard for fame," the CAFC remanded the case to the TTAB for determination utilizing the correct standard. Joseph Phelps Vineyards, LLC v. Fairmont Holdings, LLC, 122 USPQ2d 1733 (Fed. Cir. 2017) [precedential].

The CAFC ruled that the Board erred in giving no weight to the fifth du Pont factor after finding that Petitioner Phelps's mark INSIGNIA was not a famous mark. The CAFC pointed out that, unlike for dilution, fame for likelihood of confusion purposes is not an "all-or-nothing" proposition. Consequently, the Board "did not properly apply the 'totality of the circumstances' standard, which requires considering all the relevant factors on a scale appropriate to their merits."

Petitioner Phelps submitted evidence that INSIGNIA wine is renowned in the marketplace for wine and among consumers of fine wine. The record included evidence of extensive recognition and praise for INSIGNIA brand wine. The CAFC was therefore "perplexed at the Board’s finding that INSIGNIA wine has no 'fame,' giving no discernable weight to this factor." The "fame" factor should have been given "reasonable weight" among the totality of circumstances.

In a concurring opinion, Judge Pauline Newman pointed out two additional issues that should be reviewed on remand. First, the Board failed to consider the actual usage of respondent's mark, with the words ALEC BRADLEY separated from STAR and INSIGNIA, in a different font and size. [See specimens of use above].

The Board erred in declining to consider "illustrations of the mark as actually used," for precedent recognizes that such illustrations "may assist the T.T.A.B. in visualizing other forms in which the mark might appear." Citigroup Inc. v. Capital City Bank Grp., Inc., 637 F.3d 1344, 1353 (Fed. Cir. 2011).

Second, the issue of relatedness of the goods should be further considered, since the Board found that the evidence "suggests that the goods are sold in the same channels of trade to the same purchasers." Again, the Board treated this factor as an all-or-nothing proposition, but the evidence of relatedness should be considered on a "sliding scale."

Judge Newman pointed to the TTAB's non-precedential opinion in In re Licores Veracruz, S.A. de C. V., Serial No.77753913 (TTAB January 26, 2012), wherein the Board reached a contrary conclusion on the relatedness issue with respect to rum and cigars:

[I]n conjunction with the arbitrary nature of the mark MOCAMBO, we find that cigars and rum will be encountered by the same consumers under circumstances that could, because of the identity of the marks, give rise to the mistaken belief that they originate from the same source . . . . In view of the facts that the marks are identical and are a fanciful or arbitrary term, and the goods are related, move in the same channels of trade and are sold to the same consumers, we find that applicant’s mark MOCAMBO for "rum" is likely to cause confusion with the mark MOCAMBO for "cigars."

Here, the Board found that, because wine and cigars are products that differ in both composition and method of manufacture, they are not "related." However, "relatedness is a broad concept; products may exhibit 'relatedness' when they “are complementary products sold in the same channels of trade to the same classes of consumers."

Judge Newman observed that the Board should provide "reasonably consistent rulings on similar facts, to provide premises on which the public can rely."

Read comments and post your comment here.

TTABlog comment: Perhaps the CAFC should have been more clear as to the fifth factor: the Board should have given weight to the strength of the mark, even if the mark is not famous for Section 2(d) purposes.

On the relatedness issue, is Judge Newman merely second-guessing the Board's ultimately subjective finding?

FWIW, I think the Board reached the right result, but needed to provide a better explanation of its ruling.

Text Copyright John L. Welch 2017.


At 8:19 AM, Blogger Gene Bolmarcich, Esq. said...

Hooray for Judge Newman. She correctly chided the Board for its inconsistent approach to the DuPont factors, especially the way they manipulate the relatedness factor to achieve the result they want. Sometimes they treat relatedness is a strict binary factor and sometimes they explain that it's a matter of degree. Instead of treating the two main factors as spectra, they merely apply one of two rules to recognize this but both treat the factors as binary. "When the goods are identical, the marks need not be as close" and "where the marks are identical, the goods only need to be viably related". I hope the Board obeys Judge Newman's opinion.


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