Precedential No. 5: Opposer Proves Standing Through Trade Name Use by Its Wholly Owned Subsidiary

In this long-running battle over the mark CINGULAR for cell phones and related products, the Board bifurcated the issues so that it could first rule on whether opposer has standing to bring the proceeding. Applicants claimed that opposer had stopped using the mark CINGULAR when it became AT&T, but the Board found that "[o]pposer is the owner of a majority share in a company named AT&T Mobility II LLC, which in turn holds a 100% interest in New Cingular, which uses the term CINGULAR in its trade name." AT&T Mobility LLC v. Mark Thomann and Dormitus Brands LLC, 2020 USPQ2d 43785 (TTAB 2020) (February 10, 2020) [precedential] (Opinion by Judge Frances Wolfson).

To establish standing, an opposer must prove that it has a “real interest” in the proceeding beyond that of a mere intermeddler, and a “reasonable basis” for its belief of damage. Empresa Cubana Del Tabaco v. Gen. Cigar Co., 753 F.3d 1270, 111 USPQ2d 1058, 1062 (Fed. Cir. 2014); Ritchie v. Simpson, 170 F.3d 1092, 50 USPQ2d 1023, 1025 (Fed. Cir. 1999). Opposer's four claims included a claim of false suggestion of a connection under Section 2(a). The Board noted that if opposer established its standing under Section 2(a), it was entitled to "rely on any available statutory grounds for opposition set forth in the Trademark Act." See A&H Sportswear Co. v. Yedor, 2019 USPQ2d 111513, *3 (TTAB 2019).

For a Section 2(a) claim, standing “does not rise or fall on the basis of a plaintiff’s proprietary rights in a term; rather, a Section 2(a) plaintiff has standing by virtue of who the plaintiff is, that is, the plaintiff’s personality or ‘persona.’” Estate of Biro v. Bic Corp., 18 USPQ2d 1382, 1385 (TTAB 1991).

We see no categorical legal bar precluding a corporate or institutional plaintiff from claiming, in a Board proceeding, a false suggestion of a connection with its trade name, where, as here, its allegations of standing are based on alleged injury from an unauthorized use of a mark that falsely suggests a connection with its persona.

in 2007, opposer legally changed its name from Cingular Wireless LLC to its current name of AT&T Mobility LLC. Opposer claimed that it may rely on use of the name CINGULAR by its controlled subsidiary, New Cingular Wireless PCS, LLC ("New Cingular"). Opposer had the burden "to show that New Cingular uses the term and that its corporate relationship with Opposer qualifies Opposer to claim the benefit of New Cingular’s use."

The Board first considered whether New Cingular uses the term CINGULAR. Applicant contended that Opposer abandoned the CINGULAR marks when it stopped using them after “making the switch” to AT&T; that Opposer’s CINGULAR registrations have expired; that New Cingular does business as AT&T Mobility and does not use its legal name (New Cingular Wireless PCS, LLC) except on formal legal documents; and that “[c]ustomer-facing interactions are under the name AT&T Mobility.”

The Board, however found that the evidence supported opposer’s contention that New Cingular uses the term “Cingular” in its trade name.

The name appears, in some cases prominently, on contracts or licenses. It would be viewed by those with whom New Cingular has entered into these agreements, such as professionals interested in the construction of cell towers as well as retail consumers purchasing cell phone wireless services under the AT&T Next program.

The evidence demonstrated that New Cingular conducts significant business in wireless communications using the trade name “New Cingular Wireless PCS, LLC.” The Board therefore concluded that "New Cingular uses CINGULAR as part of its trade name, and that the trade name is known to the relevant public."

The next question was whether use of CINGULAR by new Cingular established opposer’s standing? The Board observed that the parent corporation of a wholly owned subsidiary “can reasonably believe that damage to the subsidiary will naturally lead to financial injury to itself.” Univ. Oil Prods. Co. v. Rexall Drug & Chem. Co., 463 F.2d 1122, 174 USPQ 458, 459 (CCPA 1972). Opposer established that it owns a majority interest in AT&T Mobility II LLC, which owns a 100% interest in New Cingular. "Accordingly, Opposer has established the necessary relationship to New Cingular such that it 'can reasonably believe that damage to the subsidiary will naturally lead to financial injury to itself,'" and opposer thus proven that it has standing to pursue its false connection claim under Section 2(a).

The Board then set a schedule for discovery and trial of the substantive issues in the case.

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TTABlog comment: Now AT&T has to prove its claims: (1) false suggestion of a connection under Section 2(a), (2) misrepresentation of source under Section 14(3), (3) lack of a bona fide intention to use the marks as of the filing dates of the underlying applications; and (4) that the applications are void ab initio due to an invalid assignment under Section 10(a)(1).

Text Copyright John L. Welch 2020.