Tuesday, March 05, 2019

Rejecting Estoppel and Parody Defenses, TTAB Finds CRABS ADJUST HUMIDITY Confusable with CARDS AGAINST HUMANITY for Card Games

In a 33-page opinion, the Board sustained this opposition to registration of CRABS ADJUST HUMIDITY, in standard character and design form, finding the mark likely to cause confusion with the registered mark CARDS AGAINST HUMANITY, both for card games and game cards.The Board rejected applicant's affirmative defenses of estoppel and bad faith, and likewise deep-sixed applicant's parody defense. Cards Against Humanity, LLC v. Vampire Squid Cards, LLC, Opposition No. 91225576 (February 28, 2019) [not precedential] (Opinion by Judge Thomas W. Wellington).

Applicant's founders created its game cards as an "expansion pack" to opposer's popular card game. In choosing the applied-for mark, applicant "wanted a phrase that would evoke [CARDS AGAINST HUMANITY] by rhyming with it, but in an absurd and surreal way." Email communications between the parties ensued, and in 2013 opposer gave applicant permission to have a first set of cards printed and sold on applicant's website.

Sales of applicant's cards peaked by Christmas 2014, and applicant began selling on Amazon.com and at small retailers. However, when applicant attempted to sell its cards to the Target retail chain, opposer objected. The subject application was filed in May 2015, and opposer filed a timely opposition.

Estoppel Defenses: Applicant claimed that it received opposer's approval to market its game, and did so for two years without complaint from opposer. This express consent, according to applicant, was followed by applicant's detrimental reliance. Thus the defense of estoppel was created. Applicant further contended that "an express consent to use necessarily includes a consent to register."

Opposer admitted that it gave "a limited permission to use the name Crabs Against Humidity as part of an overall design back in 2013." However, opposer asserted, that permission was limited to the specific design and applied only to a small print run to be sold at applicant's website.

The Board observed that estoppel by acquiescence requires proof of three elements: "(1) that plaintiff actively represented that it would not assert a right or a claim; (2) that the delay between the active representation and assertion of the right or claim was not excusable; and (3) that the delay caused defendant undue prejudice." For an inter partes proceeding, the period of delay does not begin to run until the subject mark is published for opposition. Here, opposer timely filed its opposition, and so there was no unexcusable delay.

As to estoppel by express consent, the Board found that defense to be unavailing. The extent of opposer's consent was ambiguous. Applicant apparently did not believe it could pursue any sales without consent. Moreover, even if opposer had unconditionally consented to applicant's use of its marks, there was no evidence that opposer consented to registration. Therefore this defense also failed.

Finally, applicant's assertion that opposer was guilty of unclean hands due to its attempt to restrain trade was beyond the Board's jurisdiction.

Likelihood of Confusion: The facts that the involved goods are identical, and therefore presumably travel through the same channels of trade to the same classes of consumers, and the goods are relatively inexpensive items that may be purchased on impulse, weighed heavily in opposer's favor. Moreover, because the goods are identical, a lesser degree of similarity between the marks is necessary to support a finding of likely confusion.

As to the marks, the Board found them to be "quite similar." The similarity is no coincidence, since applicant admitted that it intended to invoke opposer's mark by "rhyming with it." Consumers often abbreviate or shorten marks, and the record showed that consumers do indeed abbreviate the parties's marks to CAH.

Applicant claimed that its mark is a "parody" of opposer's mark, like the "Chewy Vuitton" dog toy. However, the Board has long held that parody is a viable defense to a Section 2(d) claim only if the involved marks are not otherwise confusingly similar. [If they are not confusingly similar, why would you need the parody defense? - ed.]. Here, the marks are similar in their overall commercial impression, and so the parody defense was inapplicable.

The Board found that the differences in the literal connotations of the marks did not overcome their similarities in appearance, pronunciation, and overall commercial impression. Both marks "share a whimsical or nonsensical nature," and applicant admitted that its mark "necessarily . . . calls to mind" opposer's mark.

The Board further found that opposer's mark is "very strong." Its game has enjoyed significant sales and an impressive amount of unsolicited publicity, and the game has been a best-seller on Amazon.com for years.

Moreover, opposer supplied "substantial" evidence of actual confusion that had "clear probative value." Although the number of known instances of confusion were few when compared to the number of games sold, the Board found them to be at least "illustrative of how and why confusion is likely."

Finally, invoking the 13th du Pont factor, opposer alleged that applicant had proceeded in bad faith, but the Board was unconvinced. "A finding of bad faith must be supported by an intent to confuse, rather than mere knowledge of another's mark or even an intent to copy." Here, applicant had reason to believe it received approval to adopt its mark, and so the Board found this factor to be neutral.

Conclusion: Balancing the relevant du Pont factors, the Board found that opposer had proven a likelihood of confusion by a preponderance of the evidence that consumers are likely to mistakenly believe that applicant's goods originate with, or are licensed, sponsored, or approved by, opposer. "The intention of [A]pplicant was to get as close to [O]pposer's marks as possible and it is our opinion that it has succeeded to the extent that there is a likelihood of confusion." (citation omitted).

Read comments and post your comment here.


Text Copyright John L. Welch 2019.


At 12:22 PM, Anonymous Anonymous said...

Has it actually been established that the delay for acquiescence is measured in the same manner as the delay for laches, meaning it doesn't start until publication? The Board in this case states that as the rule, but that doesn't seem to be established by the precedential cases cited by the Board in this ruling. The Bausch & Lomb case cited here includes a discussion of estoppel but does not make clear whether this applies the same to estoppel by laches and estoppel by acquiescence, and older cases have made clear distinctions between the two. The Krause case cited here does explicitly say that the time for delay starts at publication, but that case is not precedential and the precedential case that it cites to in support of this conclusion (NCTA v ACE) is about laches, not acquiescence.

In another opposition decision in 2016 (No. 91221974) the Board expressly differentiated between laches and acquiescence. While the Board did not expressly state that the time for measuring delay was different for acquiescence vs laches, the way in which the Board differentiated between the two defenses seemed to imply that it had not been established that the time for measuring delay was the same for both.

Palisades Pageants, Inc. v. Miss Am. Pageant seemed to make clear that for acquiescence defense the time for delay can start to run with actual knowledge before the publication of the application. This case was overruled by Natl Cable, but Natl Cable only discussed delay for laches, not acquiescence, so did it actually overrule statements about delay for acquiescence?

It also seems to make sense that the time for delay would be measured differently for acquiescence than for laches. For acquiescence, the opposer had actual knowledge and the defense is based upon affirmative statements or conduct, not mere lack of action. If an opposer gives and applicant affirmative consent to use AND register a mark and the applicant continues on using that mark but waits a few years before applying to register, why should the opposer be allowed to avoid its previous consent? If the applicant relied on that consent in building its goodwill and then applied for registration, again in reliance on opposer's statements that it consented to registration, shouldn't equity say that the opposer cannot now, years later, change its mind?

At 5:01 AM, Anonymous Anonymous said...

Agree with the Board here - nowadays any claim to parody seems to get an assumed benefit of the legitimacy of any claimed "commentary" even when arguably a pretext for coming too close commercially. Perhaps this is a social knee-jerk reaction to overzealous brands in combination with a higher tolerance for "noisy" online commerce platforms?

At 5:21 AM, Blogger John L. Welch said...

But how can one acquiesce to registration of a mark until it is published for opposition?


Post a Comment

<< Home