AIPLA TRADEMARK BOOT CAMP June 10, 2011 The EX PARTE Appeal Brian Edward Banner, Esq. i

Transcription

1 AIPLA TRADEMARK BOOT CAMP June 10, 2011 The EX PARTE Appeal Brian Edward Banner, Esq. i Overview Applicants often adopt, use and apply to register a mark or brand for goods and services that is not permitted on the Principal Register. Section 2 of the Lanham Act lists the types of marks with substantive problems not permitted initially to be registered. ii Many times, the applied for mark is too close or confusingly similar to an existing registration. Many times an applicant will attempt to create a distinctive and non-confusing new brand for the same goods or services by using an existing mark and adding some distinceive logo to the combined mark. The Trademark Examining Attorney is responsible for enforcing compliance with 2(d) and she/he will refuse registration of confusingly similar marks. To prevent legal problems clients should be educated to obtain the advice of a practicing trademark attorney prior to adopting a new mark. This step usually reduces the risk a client faces of adopting a mark which it cannot legally own and which may cause it other legal problems. Of course, clients often are willing to accept a degree of risk when marketing a new branded product. Sometimes that level of risk may be higher than what a practicing trademark attorney believes is prudent based on her/his experience but at least the client has made an informed decision based on facts and opinions the attorney has provided. This paper discusses the situation where a new service mark has been adopted and an application to register the mark filed at the U.S. Patent and Trademark Office. The application was refused registration because the service mark was found to be likely to be confused with a prior registered mark. If a refusal to register is made FINAL under 2(d) likelihood of confusion, the applicant has several choices. It may (1) abandon the application by not filing a response; (2) comply with the outstanding requirement if possible (e.g., obtain a consent from the owner of the cited registration or purchase the cited registration); (3) file a timely ex parte appeal at the Trademark Trial and Appeal Board ( TTAB or Board ) attempting to reverse the final refusal because a likelihood of confusion does not exist between the applied for and the cited marks. This paper summarizes the process of an ex parte appeal from a refusal under 2(d) of the Lanham Act. iii While many ex parte appeals are filed from final refusals made by the Examining Attorney under various provisions of the Lanham Act, a repeated requirement for a disclaimer of a descriptive word, an amended drawing, an amended identification of goods or services to make it clearer, a properly worded declaration, a substitute acceptable specimen of use or an acceptable drawing of the mark may also be the subject of an ex parte appeal, provided no new issue(s) have been raised by the Examining Attorney. iv When an ex parte appeal is authorized and timely filed on behalf of your 1

2 client the Board acts as an appellate court over the Trademark Examining Attorney s refusal. The Board reviews the file s history, the briefs and possibly oral arguments at a hearing and then the Board will reverse or affirm that decision on registration. The reader is encouraged to review the statute and rules governing ex parte appeals at the Board before undertaking such an appeal. v Setting Perhaps the best way to illustrate the ex parte appeal process is to look at a case (Serial Number 77/186166) wherein the Board was asked to decide if the applicant or the Trademark Examining Attorney was correct in their differing opinions on likelihood of confusion regarding the service mark MAX with and without a design. In In re Max Capital Group Ltd. vi the only issue was whether or not there would be likelihood of confusion between two prior registered marks MAX in block capital letters and MAX in a combination word and logo design format for insurance services and the applied for combination word and logo design mark for the insurance services listed in the application. When there is a question of likelihood of confusion under 2(d) the Trademark Examining Attorney must compare the mark in the application against all other registered marks for the same or related goods or services (and any other relevant factor under the du Pont set of factors) to decide whether registration of the mark will create likelihood of confusion. Before citing a registration, the Trademark Examining Attorney must check the automated records of the Office to confirm that any registration that is the basis for a 2(d) refusal is an active registration. Facts mark: Max Capital Group Ltd. applied to register the combined word and design service for services identified therein as, writing property and casualty insurance and reinsurance; life, health and annuity reinsurance underwriting; property catastrophe reinsurance, aviation reinsurance, marine reinsurance, and energy reinsurance underwriting; excess and surplus insurance services, namely, property, 2

3 inland marine, casualty, excess liability and umbrella underwriting. insurance Every application examined by the U.S. Patent and Trademark Office Trademark Examining Attorney undergoes a search of the Office records to determine whether the applied for mark resembles any prior pending or registered mark(s) as to be likely to cause confusion or mistake, when used on or in connection with the goods or services identified in the application. If the Trademark Examining Attorney determines that there is a likelihood of confusion between an applied for mark and a previously registered mark, the Trademark Examining Attorney refuses registration under 2(d). Where a pending application contains a mark that may be confusingly similar to a subsequently filed application containing a similar mark, that later filed application will be suspended pending the registration or abandonment of the prior filed application. During the examination of the application in question, the Trademark Examining Attorney learned of two prior registrations for MAX as a word mark reflected in Registration No. 2,866,938, issued July 27, 2004 and MAX (and design) Registration No. 3,108,696, issued June 27, 2006 both for, underwriting of property and casualty insurance. He issued an initial 2(d) refusal of the application on the ground of likelihood of confusion citing both of these prior registrations. Applicant filed an unpersuasive response and the examiner made the 2(d) refusal FINAL. Applicant disagreed with that holding and timely filed an ex parte appeal along with a request for reconsideration of the holding by the examiner. The examiner denied the request for reconsideration and the ex parte appeal moved forward. In the case of In re E. I. du Pont de Nemours & Co., vii the Court of Customs and Patent Appeals (a predecessor court to the Court of Appeals for the Federal Circuit, CAFC), discussed thirteen factors relevant to a determination of likelihood of confusion. In examination, the issue of likelihood of confusion typically revolves around the similarity or dissimilarity of the marks and the relatedness of the goods and/or services as they are identified in the registration(s) and the application. The other factors listed in du Pont may be considered only if relevant evidence is contained in the record. The following factors are usually the most relevant in ex parte appeals: The similarity or dissimilarity of the marks in their entireties as to appearance, sound, connotation and commercial impression; The relatedness of the goods or services as described in an application or registration or in connection with which a prior mark is in use; The similarity or dissimilarity of established, likely-to-continue trade channels; 3

4 The conditions under which and buyers to whom sales are made, i.e., impulse vs. careful, sophisticated purchasing; The number and nature of similar marks in use on similar goods; and A valid consent agreement between the applicant and the owner of the previously registered mark. Subsequent to the du Pont case the CAFC has provided further guidance with regard to determining and articulating likelihood of confusion by stating: The basic principle in determining confusion between marks is that marks must be compared in their entireties and must be considered in connection with the particular goods or services for which they are used. It follows from that principle that likelihood of confusion cannot be predicated on dissection of a mark, that is, on only part of a mark. On the other hand, in articulating reasons for reaching a conclusion on the issue of confusion, there is nothing improper in stating that, for rational reasons, more or less weight has been given to a particular feature of a mark, provided the ultimate conclusion rests on consideration of the marks in their entireties. Indeed, this type of analysis appears to be unavoidable. viii In responding to the final rejection under 2(d) Applicant filed traversing arguments with the Board on the relevant du Pont factors. These arguments are summerized below. SIMILARITY BETWEEN THE MARKS The first of the du Pont factors and a paramount issue here was whether applicant's mark and the cited two registered marks, when compared in their entireties in terms of appearance, sound and connotation, are similar or dissimilar in their overall commercial impressions. The test is not whether the marks can be distinguished when subjected to a side-by-side comparison, (often misunderstood by clients) but rather whether the marks are sufficiently similar that confusion as to the source of the goods and/or services offered under the respective marks is likely to result. ix As clarified in 2005 x, commercial impression is but one of the four prongs along with appearance, sound, and meaning of the mark to be determined under du Pont factor one. When examining the Applicant s combination mark 4

5 the Trademark Examining Attorney concluded that the word MAX was the dominant feature of that mark in creating the commercial impression and the pillar logo design was not unusually distinctive so that its presence created a different commercial impression vis-à-vis the prior two registrations thereby removing the risk of a likelihood of confusion with them. Applicant argued that the Trademark Examining Attorney was wrong and had given too little weight to the allegedly distinctive pillar design portion of its mark. Further, he had not properly considered the mark as a whole but rather had dissected the applied for mark into two parts which was not allowed under the case law. xi Therefore, the commercial impression created by the applied for pillar design and word combination mark was in the Applicant s opinion sufficiently distinctive when compared with the cited two registrations. This line of argument by the Applicant was also made to the Board. The Board reviewed the evidence of record (e.g., the file history of the application) and the arguments contained in the briefs. The Board then concluded that the applied for mark was confusingly similar based on the first cited word mark Registration No. 2,866,938 so this factor favored the Trademark Examining Attorney. RELATEDNESS OF THE SERVICES Under the second du Pont factor, Applicant could not argue that some of its listed services were not legally identical with the services in the cited two registrations. The Board agreed with the Trademark Examining Attorney that Applicant s writing property and casualty insurance was identical to the underwriting of property and casualty insurance services listed in both cited registrations. As such, this du Pont factor favored the Trademark Examining Attorney. THE SIMILARITY OF TRADE CHANNELS The Board noted that the services identified in the two cited registrations contained no limitation as to their trade channels. A channel of trade limitation in the listed identification of services might have been for example, for the bridge construction and maintenance industry or for the automobile manfacturing industry. Accordingly, a presumption arises that registrant's services are marketed in all normal trade channels for such services and to all normal classes of purchasers for such services. Since the services were in part identical the same channels of trade and class of purchasers would be the same. This du Pont factor favored the holding of likelihood of confusion. 5

6 CONDITIONS UNDER WHICH AND BUYERS TO WHOM SALES ARE MADE Under the fourth du Pont factor, Applicant argued that the relevant classes of purchasers in this case are sophisticated and careful purchasers and are not the casual general public. The Examining Attorney did not disagree but considered this factor as neutral favoring neither the Applicant nor the Office. The Board found that this single factor favored the Applicant. The Board stated that all other du Pont factors for which evidence and arguments were submitted were neutral. Balancing the relevant du Pont factors the Board affirmed the Trademark Examining Attorney s refusal under 2(d) based on prior Registration No. 2,866,938. In addition to repeated traversing arguments, to show the weakness of the word mark Max reflected in cited Registration No. 2,866,938 the applicant submitted a large number of third-party registrations and Internet gathered evidence which purported to show third-party use of MAX as a mark for many different services and/or goods. The Board concluded that the registrations merely show the dictionary meaning of the word max but do not prove that the marks depicted therein are in use. As for the 300 pages of Internet gathered evidence the Board found that much of it was unhelpful, duplicative and entitled to very little probative weight. Further and more importantly, the Applicant failed to point out in its brief the specific Internet evidence that it believed is most probative of its argued position. This oversight was criticized in the opinion. The Board acknowledged that there are some instances in which MAX is used by third parties in connection with insurance services but many of these uses include other strong identifying elements. For example, Allstate Insurance Company-Marcus Max Pizano and Max Car Insurance. While the cited registration MAX No. 2,866,938 has a suggestive meaning and therefore is not entitled to a broad scope of protection, the Board stated that even a suggestive or weak mark is entitled to protection from the use of a very similar mark for legally identical services. It cited In re Chico Inc. xii for support of this conclusion. The Board also held that the word portion of Applicant s mark was identical to that of the cited registration in appearance, pronunciation, meaning and commercial connotation. This holding, coupled with the conclusion that the addition of the pillar design did not result in the mark that was sufficiently distinguished from the cited mark, strengthened the Board s conclusion. It agreed with the Trademark Examining Attorney that the pillar design is not so unusual that consumers would find it an arresting or eye catching feature as to identify a different source for legally identical insurance services. Finally, again cited In re Chica Inc., ibid on the issue of the legal impact of thirdparty registrations the Board concluded that they cannot assist the Applicant: [A]n applicant does not overcome a likelihood of confusion refusal by pointing to other registrations and arguing that they are a similar to the 6

7 cited registration as applicant s mark. While third-party registrations may be used to demonstrate that a portion of the mark is suggestive or descriptive, they cannot justify the registration of another confusingly similar mark. Had the owner of the cited registrations provided the Applicant with a written consent to use and register agreement, the consent would have been persuasive evidence on the issue of the absence of likelihood of confusion. xiii As the court said in du Pont, When those must familiar with use in the marketplace and most interested in precluding confusion enter agreements designed to avoid it, the scales of evidence are clearly tilted It is at least difficult to maintain a subjective view that confusion will occur when those directly concerned say it won t. xiv Care in drafting such an agreement is necessary to avoid it being held to be a naked consent. A consent agreement that is not merely a naked consent typically details reasons why no likelihood of confusion exists and/or arrangements undertaken by the parties to avoid confusing the public. In one case xv a consent agreement was found to be naked because the agreement did not restrict the markets in such a way as to avoid confusion. Applicant apparently did not attempt to obtain such consent. Registrants will often want something of value in return for executing such consent to use and register agreement. Because they are often difficult to successfully negotiate when presented with such a consent concluded during a proceeding before the Board it will suspend and remand the case to the Examining Attorney for consideration of the consent agreement. Any motion to suspend and remand filed at the Board accompanied by the recently executed consent agreement which is filed prior to the Board s rendering of its final decision will usually be granted. Another possible piece of potentially persuasive evidence would have been properly conducted survey showing that Applicant s combination word and logo mark for its services was not likely to be confused by the public. Survey evidence could have been prepared and filed during the prosecution of the application by the Applicant. Such surveys are often effective tools to show the Trademark Examining Attorney the public perception of a combined mark, the unrelatedness of the services or marketing channels, or the absence of actual confusion between the applied for mark and the cited mark. Unfortunately, surveys are expensive and times consuming so most Applicants do not prepare this type of evidence. No such survey evidence was offered by the Applicant in this case. Nexis and Internet search results can be helpful evidence on the issue of channels of trade. While the Trademark Examining Attorney must generally look only at the identification of goods and/or services in the registration, Nexis and Internet search results can help the Trademark Examining Attorney understand how the goods or 7

8 services are performed in the real world. Internet evidence on the cost of the services in the registration can be submitted to argue that the Applicant s services are expensive and/or differ from services in the cited registrations. Declarations by Applicant s customers are sometimes helpful when arguing the issues of likelihood of confusion, relevant channels of trade, etc. Employee declarations that no actual confusion has been reported are also helpful on that issue of confusion despite the fact that it is but one of several du Pont factors considered. During prosecution an Applicant might conduct an investigation on the actual ongoing use of the mark in the cited registration to see if the registration is subject to cancellation or partial cancellation due to non-use of the mark for no excusable reason. Sometimes a mark cited as a 2(d) reference has not been in use for many years and is subject to cancellation. Non-use of a registered mark for three consecutive years raises a rebuttable presumption of abandonment. xvi The reasons for the non-use vary but may include merger of the owner with another entity, economic recession, a change in management triggering its decision to discontinue a line of branded products [e.g., SATURN, PONTIAC, MERCURY, KODACHROME, etc.] or any other reason that caused the mark to cease being used on the services or goods listed in the registration. If this turns out to be the case, the Applicant may file a cancellation or partial cancellation Petition against the cited registration. Filing such an action will not suspend the prosecution of the application under 2 refusals so be careful to ask the Trademark Examining Attorney to suspend the application under refusal pending the outcome of the cancellation petition. During this sixty day period starting with the filing of the Notice of Appeal the Applicant may attempt to purchase the cited registration. The purchase may not be successful for a number of reasons including cost, timing, and value of the mark to the registrant. If the Applicant is unsuccessful in negotiating a purchase of the cited registration then Applicant s main brief has to be prepared and timely filed according to the rules with the Board. xvii The Applicant s brief is limited to twenty-five double-spaced pages of pica or eleven-point typewritten, including the facts, issues to be decided, arguments and conclusions. If the brief exceeds the length limit the Applicant runs the risk of having the brief rejected assuming it has not requested and received approval from the Board to file a larger brief. Citing to the United States Patent Quarterly makes it easy for Board personnel to review those cases supporting the Applicant s arguments. If it is necessary to cite cases from the Federal Reporter or Federal Supplement help your position by attaching a copy of those cases to your brief. Should additional time in which to file the brief be required, the Applicant may file a motion to extend the time for filing the brief. The Board will consider the reason for the request and is liberal in granting such motions. Failure to file the brief within the time allowed and in the absence of a motion to extend will cause the Board to assume that the Applicant is no longer interested in the appeal leading to the dismissal of the appeal. 8

9 When the Board receives the main brief it sends the file and Applicant s brief back to the Trademark Examining Attorney who has sixty days to prepare and file a responsive brief and mail a copy to the Applicant. xviii In rare instances, the Trademark Examining Attorney may determine that the refusal should be withdrawn based on the law put forth in the main brief. If that rare event occurs, the Applicant is advised and the subject application is forwarded for publication. xix The responsive brief presents the authorities, arguments and reasoning the Trademark Examining Attorney relied upon during prosecution and states why the refusal or requirement is proper. Should the Trademark Examining Attorney fail to file a timely responsive brief (without adequate explanation for filing a late brief), the late brief may be excluded from consideration in an ex parte appeal. The Applicant may elect to file a reply brief upon receipt of the Examining Attorney s responsive brief. This is the last possible brief in the case. Applicant may request an oral hearing within ten days following the due date of any reply brief. xx If requested, the Board will schedule the oral hearing before a panel of three Administrative Trademark Judges assigned to make the ruling on the ex parte appeal. This takes about six months. At the oral hearing the Applicant has twenty minutes to highlight the arguments made in its main and reply briefs. The Board may question the Applicant on positions taken therein. Thereafter, the Trademark Examining Attorney is given ten minutes in which to summarize her/his main reasoning in the case. The Board may also question the Trademark Examining Attorney about the reasons for the refusal or requirement. Once both sides have completed their statements and arguments the case is submitted to the Board for its decision. Should an adverse decision be issued by the Board, the Applicant may request reconsideration within one month of that decision. xxi If the Board denies the request for reconsideration Applicant is faced with the choice of living with the final decision or appealing it to either the Court of Appeals for the Federal Circuit (CAFC) or to a U.S. District Court. If the appeal is to the CAFC it is commenced by filing a notice of appeal at the USPTO within two months of the Board s final decision. The appeal must also be filed with the CAFC at the same time together with that courts filing fee. Such an appeal is decided based only on the evidence in the record before the Board. No additional evidence is permitted. If Applicant decides to file an appeal at the U.S. District Court with that court s filing fee, new evidence not in the Board s record can generally be introduced into that civil proceeding. This constitutes a de novo review of the entire case before the District Court. Venue is proper either in the District of Columbia or the federal judicial district where the Applicant is located. xxii THE END i Partner, H&A Intellectual Property Law, PLLC, Alexandria, Virginia. ii Section 2 (15 U.S.C. 1052): No trademark by which the goods of the applicant may be distinguished from the goods of others shall be refused registration on the principal register on account of its nature unless it-- (a) Consists of or comprises immoral, deceptive, or scandalous matter; or matter which may disparage or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring them into 9

10 contempt, or disrepute; or a geographical indication which, when used on or in connection with wines or spirits, identifies a place other than the origin of the goods and is first used on or in connection with wines or spirits by the applicant on or after one year after the date on which the WTO Agreement (as defined in section 2(9) of the Uruguay Round Agreements Act [19 USC 3501(9)]) enters into force with respect to the United States. (b) Consists of or comprises the flag or coat of arms or other insignia of the United States, or of any State or municipality, or of any foreign nation, or any simulation thereof. (c) Consists of or comprises a name, portrait, or signature identifying a particular living individual except by his written consent, or the name, signature, or portrait of a deceased President of the United States during the life of his widow, if any, except by the written consent of the widow. (d) Consists of or comprises a mark which so resembles a mark registered in the Patent and Trademark Office, or a mark or trade name previously used in the United States by another and not abandoned, as to be likely, when used on or in connection with the goods of the applicant, to cause confusion, or to cause mistake, or to deceive: Provided, That if the Director determines that confusion, mistake, or deception is not likely to result from the continued use by more than one person of the same or similar marks under conditions and limitations as to the mode or place of use of the marks or the goods on or in connection with which such marks are used, concurrent registrations may be issued to such persons when they have become entitled to use such marks as a result of their concurrent lawful use in commerce prior to (1) the earliest of the filing dates of the applications pending or of any registration issued under this Act; (2) July 5, 1947, in the case of registrations previously issued under the Act of March 3, 1881, or February 20, 1905, and continuing in full force and effect on that date; or (3) July 5, 1947, in the case of applications filed under the Act of February 20, 1905, and registered after July 5, Use prior to the filing date of any pending application or a registration shall not be required when the owner of such application or registration consents to the grant of a concurrent registration to the applicant. Concurrent registrations may also be issued by the Director when a court of competent jurisdiction has finally determined that more than one person is entitled to use the same or similar marks in commerce. In issuing concurrent registrations, the Director shall prescribe conditions and limitations as to the mode or place of use of the mark or the goods on or in connection with which such mark is registered to the respective persons. (e) Consists of a mark which (1) when used on or in connection with the goods of the applicant is merely descriptive or deceptively misdescriptive of them, (2) when used on or in connection with the goods of the applicant is primarily geographically descriptive of them, except as indications of regional origin may be registrable under section 4 [15 USC 1054], (3) when used on or in connection with the goods of the applicant is primarily geographically deceptively misdescriptive of them, (4) is primarily merely a surname, or (5) comprises any matter that, as a whole, is functional. (f) Except as expressly excluded in subsections (a), (b), (c), (d), (e)(3), and (e)(5) of this section, nothing herein shall prevent the registration of a mark used by the applicant which has become distinctive of the applicant's goods in commerce. The Director may accept as prima facie evidence that the mark has become distinctive, as used on or in connection with the applicant's goods in commerce, proof of substantially exclusive and continuous use thereof as a mark by the applicant in commerce for the five years before the date on which the claim of distinctiveness is made. Nothing in this section shall prevent the registration of a mark which, when used on or in connection with the goods of the applicant, is primarily geographically deceptively misdescriptive of them, and which became distinctive of the applicant's goods in commerce before the date of the enactment of the North American Free Trade Agreement Implementation Act [enacted Dec. 8, 1993]. A mark which when used would cause dilution under section 43(c) [15 USC 1125(c)] may be refused registration only pursuant to a proceeding brought under section 13 [15 USC 1063]. A registration for a mark which when used would cause dilution under section 43(c) [15 USC 1125(c)] may be canceled pursuant to a proceeding brought under either section 14 [15 USC 1064] or section 24 [15 USC 1092]. iii 15 U.S.C et seq. iv TBMP and v 37 C.F.R. Part 2-Rules of Practice in Trademark Cases through vi (SN 77/186,166) (TTAB January 4, 2010). vii 476 F.2d 1357, 177 USPQ 563 (C.C.P.A. 1973). viii In re National Data Corp., 753 F.2d 1056, 1058, 224 USPQ 749, (Fed. Cir. 1985). ix Sealed Air Corp. v. Scott Paper Co., 190 USPQ 106 (TTAB 1975). x Palm Bay Imports Inc. v. Veuve Clicquot Ponsardin Maison Fondee En 1772, 73 USPQ2d 1689 (Fed. Cir. 2005). 10

11 xi "The life of the law has not been logic, it has been experience." -Oliver Wendell Holmes xii 84 USPQ2d 1845, 1850 (TTAB 2007). xiii In re Four Seasons Hotels Ltd., 987 F2d 1565, 26 USPQ2d 1071 (Fed. Cir. 1993). xiv In re E. I du Pont de Nemours & Co., 177 USPQ 563 (CCPA 1973) and TMEP (d) (viii). xv In re Permagrain Products, Inc., 223 USPQ 147 (TTAB 1984). xvi Section 45 of the Trademark Act. xvii Trademark Rule specifies the form for an appeal brief. xviii Rule 2.142(b) (1). xix TMEP xx Trademark Rule 2.142(e) (1). xxi Trademark Rule xxii 28 U.S.C. Section 1391(e). 11