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The roll out of the new Generic Top-Level Domain (gTLD) program brings with it a new domain name dispute procedure. This procedure is known as the Uniform Rapid Suspension System (URS). It is compulsory that each new gTLD operator have a domain name dispute system available. The URS is specifically designed to quickly resolve well-defined cases of cybersquatting. The URS is also aimed at being a less expensive alternative to the existing UDRP (Uniform Domain-Name Dispute Resolution Policy). See our website page entitled Domain Name Disputes, where we discuss filing a UDRP Complaint.

There are some additional differences between the two systems. For example, the URS requires a heavier burden of proof by mandating that the elements must be demonstrated by clear and convincing evidence. Moreover, the remedy available varies under the two systems. Under the UDRP a complainant may request to have the domain cancelled or transferred to it, while under the URS system a complainant may only request that the domain be suspended for the life of the registration.  The URS system is being monitored to determine if once the suspension resolves will other cybersquatters register the same domain and will the cycle repeat. If this occurs, it will be problematic and will interfere with the objective of a speedy resolution. Moreover, further bad faith registrations of the same domain will show that the URS will not be an effective long term strategy.

The first complaint filed with the URS was filed by Facebook on August 21, 2013. The case commenced on September 11, 2013. The dispute involved the domain facebok.pw. The registrant did not respond to the complaint. Facebook was able to prove by clear and convincing evidence that the respondent was a serial cybersquatter. The decision was rendered on September 27, 2013 and Facebook prevailed.

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New York start-up, FiftyThree, Inc. (“FiftyThree”) filed a trademark application with the United States Patent & Trademark Office (USPTO) on May 11, 2012 for the mark PAPER BY FIFTYTHREE. The trademark application sought protection for computer application software for smart phones and tablets, namely software for use in writing on smart phones and tablets with a stylus or finger. Essentially, the product permits you to draw, sketch and create designs on mobile devices. The company alleged that it first used the trademark PAPER BY FIFTYTHREE in commerce on March 29, 2012. The trademark was issued a Certificate of Registration on December 31, 2013.

On January 30, 2014, Facebook announced it was launching an app called Paper. Facebook’s standalone app is a content reader and does not have a drawing element. FiftyThree requested that Facebook change the name of its app and although, it has been reported that Facebook apologized for not contacting FiftyThree sooner with regard to the launch of its app PAPER, it has not agreed to change the name of its news reader app.

On the same day that Facebook announced its new app called Paper, FiftyThree filed a trademark application for the mark PAPER with the USPTO. The same goods included in the first trademark application (for PAPER BY FIFTYTHREE) were identified here , but FiftyThree expanded the goods description to also include computer application software and services for creating, editing, and compiling content to share with others via a social network, as well as computer hardware and software programs and services for multimedia applications. I believe that FiftyThree filed this second trademark application to reinforce its claim to the mark PAPER BY FIFTYTHREE, but also to test its rights to “Paper” alone. In addition, I think it was attempting to assert pressure on Facebook to change the name of its app. Since this application was filed less than 3 months ago, it has not yet been reviewed by an Examiner at the USPTO yet.

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On February 6, 2013, King.com Limited (“King”), the social game publisher of the popular Candy Crush Saga, filed a trademark application for the mark CANDY  in international classes 9, 25, & 41. Among other goods and services, King was looking to protect the term CANDY for computer games, downloadable software, clothing, and a variety of services in the entertainment and sports arena. The filing of the trademark application brought controversy to the gaming world once the media reported on it. Many gaming software developers thought this was an effort to gain control over a common word and exclude other smaller competitors from use it in broad categories of goods and services. King spoke out on its motives  for filing a trademark application for CANDY.

I can understand the point of view from King’s competitors. I also think King has a valid concern in protecting its intellectual property and in preventing consumer confusion in the marketplace. Those who understand trademark law would point out that a common word, can most certainly function as a trademark, as long as it is not used to describe a function, characteristic, quality, feature, purpose, use or ingredient of the goods or services. See TMEP §1209.01(b).

If a mark is merely descriptive of the goods and services, it will be be refused on the Principal Register, but may be able to register on the Supplemental Register.  In other words, if the mark is not inherently distinctive, it may register on the Principal Register, only upon a showing of acquired distinctiveness. See our blog post entitled Can A Flavor Or A Scent Receive Federal Trademark Protection? for a detailed discussion of acquired distinctiveness. Whether a mark is merely descriptive must be made after considering the goods and services in relationship to the proposed mark. Also, if only part of a multiword trademark is descriptive, then it may be appropriate to disclaim any exclusive right in the descriptive portion of the mark. However, the mark should be allowed to proceed to registration with the disclaimer.

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On May 19, 2013 Chef Dominique Ansel filed a trademark application with the United States Patent & Trademark Office (“USPTO”) for the trademark CRONUT in International Class 30. International Class 30 includes bakery desserts, bakery goods, breads, etc. Dominique Ansel’s identification of goods specifically named a “croissant and doughnut hybrid” among multiple baked goods, pastries, and other sweets.

Criticism immediately emerged from others in the industry. The criticism came from lay people lacking the knowledge and subtleties of trademark law. Legally speaking, Dominique Ansel followed the correct procedures and was entitled to seek trademark registration for the term CRONUT for the goods identified in his trademark application. In fact, he wisely capitalized on a food trend while simultaneously branding the sweets with a unique trademark. He accomplished all of the above, while beating his competitors to the Trademark Office.

A few weeks after Chef Ansel’s filing, on June 10, 2013 a trademark application was filed with the USPTO for the proposed mark THE CRONUT HOLE. The applicant was seeking to protect the mark for retail bakery shops. The application was filed on an intent-to-use basis. The examining attorney suspended the application on September 21, 2013 on the basis that Dominique Ansel’s application had an earlier filing date, and should the application proceed to registration then the applicant’s mark for THE CRONUT HOLE may be refused under section 2(d) of the Trademark Act (15 U.S.C. §1052(d)) due to a likelihood of confusion with the registered mark.

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Tiffany has been in the jewelry business since 1886. It holds 97 trademarks that relate to its company name “Tiffany”.  Tiffany and Company and Tiffany NJ LLC (“Tiffany”) sued Costco Wholesale Corporation (“Costco”) in the Southern District of NY alleging trademark infringement, dilution, counterfeiting, unfair competition, injury to business reputation, false and deceptive business practices, and false advertising. See Tiffany & Co. v. Costco Wholesale Corp. No. 13-CV-1041 (S.D.N.Y. Feb. 14, 2013). Costco counterclaimed arguing that the terms “Tiffany” and “Tiffany Setting” are generic words for ring settings that have multiple prongs shooting upwards from the base of the ring to hold a single gemstone (a particular setting type). Costco further asserts that Tiffany has no right to prevent Costco or any other third party from using the term “Tiffany” in its generic or descriptive sense.

engagement-ringTiffany alleges that Costco is using the TIFFANY trademark in the descriptions of two rings to sell diamond engagement rings. These rings are not manufactured by Tiffany. Tiffany argues that use of the TIFFANY mark in this manner is illegal. The jewelry manufacturer and retailer moved for summary judgment seeking dismissal of Costco’s counterclaim. The Tiffany registrations  that are relevant to this dispute are U.S. Registration No. 1,228,409 TIFFANY in International Class 014 for jewelry and other goods and U.S. Registration No.133,063 for the stylized mark TIFFANY for jewelry and other goods. Tiffany further alleges that it refers to one style of engagement rings as a TIFFANY setting ring (a six prong setting that holds one diamond). The USPTO registered these trademarks and as a result, there is a presumption of validity for Tiffany. This is one of many advantages of filing your trademark on the Principal Register . This places Costco in the position of having to overcome the presumption that consumers perceive the mark as inherently distinctive.

Trademarks are evaluated and are categorized based on the strength or weakness of the mark. The scope of protection given a trademark depends on whether it is considered inherently distinctive.  Generic terms cannot function as trademarks. See Trademark Manual of Examining Procedure (TMEP) §1209.02(b) where it states that a claim of acquired distinctiveness cannot overcome a generic refusal. This is because generic words are understood by the general public to refer primarily to the category of goods or services and does not distinguish the products or services on the basis of source.

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Disney filed a lawsuit in a California Federal Court, Disney Enterprises, Inc. v. Phase 4 Films, Inc. et al, 2:13-cv-09401,  alleging trademark infringement and unfair competition. Phase 4 Films released its movie entitled “The Legend of Sarila” on November 1, 2013, generating low box office revenue. Three weeks later on November 19, 2013 Disney released its animated film Frozen. Disney alleges that once Phase 4 Films learned about the success of Frozen, they decided to retitle the film to Frozen Land.  In addition, Phase 4 Films redesigned its artwork, packaging, and logo to take advantage of the financial success of the Disney Film.

To compare the promotional materials and looks of the logos, review the Complaint filed by Disney. Make your own decision as to whether Phase 4 Films replicated the trademark logo and look of Disney’s Frozen. Phase 4 Films may have hoped to rely on the fact that the title of a single creative work can not receive federal trademark protection and it may have overlooked the other legal protections available. See Trademark Manual of Examining Procedure (TMEP) §1202.08. However, a name of a series of creative works can be registered with the United States Patent & Trademark Office (USPTO) under TMEP §1202.08(c).  For example, the series titles of the Star Wars movies could seek protection while the single title of the movie Titanic could not.

movie-house-771223-mThe next logical question is how can the single title of a creative work be protected under the law? One means of protection would be to include a cause of action for unfair competition under §43(a) the Lanham Act in your federal complaint, if appropriate. See Lanham Act §43(a) 15 U.S.C. §1125(a). Disney included an unfair competition action in its lawsuit against Phase 4 Films. Keep in mind that this is a difficult case to prove because you must show that the title achieved secondary meaning. This usually requires demonstrating high advertising expenditures, significant media coverage, and consumer surveys. One may also consider filing for a state trademark registration as a means of protection. The registration process is much simpler than the federal process and its filing fees are lower. There is also no established legal mechanism to cancel a state registration. If you want to challenge a state trademark registration, you must file a civil action. Lastly, a state registration will have a strong deterrent effect on third parties because the state registration will appear in trademark search reports.

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Under the Lanham Act, specifically 15 U.S.C. §1051(b) a trademark applicant may apply for registration, even if they have not commenced use of the trademark in commerce. This provides the trademark applicant with a critical advantage. The applicant may use its filing date as a “constructive use” date for purposes of nationwide priority. See our post entitled What Constitutes Use In Commerce For A Service Mark? where we discuss how a trademark applicant can rely on their trademark filing date to establish priority.  The trademark applicant must carefully document their bona fide intent. Most trademark applicants are not aware of this requirement and as a result, could have their application refused registration if challenged.

The party challenging the trademark applicant (the “opposer”) has the burden of demonstrating by a preponderance of the evidence that the applicant lacks the requisite intent to use the trademark in connection with the services or goods in commerce. See SmithKline Beecham Corp. v. Omnisource DDS LLC, 97 USPQ2d 1300 (TTAB 2010). If the trademark applicant cannot rebut the prima facie case, then summary judgment will be granted. The determination as to whether there is a bona fide intent to use the mark in commerce, is an objective one based on all the circumstances.

The Trademark Trial and Appeal Board (TTAB) recently determined that the trademark applicant did not satisfy its burden to come forward with documentary evidence of a bona fide intent to use the mark in commerce and granted the opposer’s motion for summary judgment. See PRL USA Holdings, Inc. v. Rich C. Young, Opposition No.91206846 (October 16, 2016) [not precedential]. In this case, the opposer was the owner of RALPH LAUREN POLO & Design and the trademark POLO. The trademark applicant filed for IRISH POLO CLUB USA & Design for shirts. Because the opposer was successful in showing that the applicant lacked a bona fide intent to use the mark, the TTAB did not have to determine the issues of likelihood of confusion and dilution. Generally, whether a trademark applicant possesses a bona fide intent to use the mark in commerce is not suitable for summary judgment disposition. However, if there is no genuine dispute of material fact as to the trademark applicant’s lack of intent to use the trademark as of the filing date, then the motion for summary judgment will be granted. In PRL USA Holdings, Inc., the opposer through its discovery requests demonstrated that the applicant could not produce any documents to support its mere allegations of intent.

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The Trademark Trial and Appeal Board (TTAB) recently answered this question on January 2, 2014, in the case of Blast Blow Dry Bar LLC v. Blown away LLC d/b/a Blast Blow Dry Bar, Opposition No. 91204769 (January 2, 2014). The applicant is a hair salon located in Minnesota marketing its services under the trademark BLAST BLOW DRY BAR for hair care services. The opposer is located in Texas, and is using the mark BLAST BLOW DRY for hair salon services that include wash and blow-dry services. The Board held that the trademarks were highly similar. The only difference was a diacritic circle and the disclaimed word “bar”. Apparently, the applicant did not conduct its due diligence. It is critical to conduct a clearance search prior to filing a trademark application so that you can avoid encountering similar marks for identical services during your trademark prosecution.

The Board concluded that the services were essentially identical. Therefore, it held that there was a likelihood of confusion between the trademarks. Since the issue of likelihood of confusion was determined, the case turned into a question of priority. To resolve this issue, one party must demonstrate they used the mark in commerce before the other party, thereby entitling that party to register the trademark at the United States Patent & Trademark Office (USPTO). The legal definition of “use is commerce” will be discussed as well as what types of action rise to this level.

hairstyle-835170-mTo establish priority a party can rely on their trademark registration, trademark filing date, trade name use, trademark or service mark use, use equivalent to service mark or trademark mark use, or demonstrate another use that rises to this level. The opposer pleaded rights based on use and use tantamount to service mark use. For a service mark to be legally used in commerce, it must be used in advertising or in the sale of the services and the services must be rendered. The opposer used its trademark in advertising and specifically on a banner as early as December 5, 2011. The opposer also attended a party as a promotional effort and styled several guests’ hair while distributing marketing brochures. However, the hair styling services were rendered as a courtesy and the opposer was never paid for such services. The TTAB held that this was sufficient for use in commerce under the Trademark Act. See 15 U.S.C. §1127 for the legal definition of commerce.

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As most people know Swatch AG is a Swiss corporation that sells watches, clocks and jewelry. It owns three United States registrations for the trademark SWATCH. It filed a Notice of Opposition against Beehive Wholesale, L.L.C. Beehive is in the wholesale and retail business, selling multiple goods, including watches and watch parts. It sells these watch parts and products under the trademark SWAP. Beehive’s watch line includes interchangeable components, hence the mark SWAP. Swatch AG opposed Beehive’s application on the grounds of mere descriptiveness, likelihood of confusion, and dilution. The Trademark Trial and Appeal Board (“TTAB”) dismissed the opposition on all counts.

-watch-Swatch dissatisfied with the Board’s finding, sued in District Court in Virginia. See Swatch, S.A. v. Beehive Wholesale, L.L.C., Civil Action Number 1:11-cv-434 (E.D. Va. August 16, 2012). Swatch filed this civil action pursuant to §1071(b) of Title 15 of the United States Code.  This section allows a trademark litigant to file a civil action instead of filing an appeal of the TTAB decision with the Federal Circuit. In this type of action, the District Court reviews the matter de novo.

Swatch brought causes of action for trademark infringement and unfair competition under federal and state statutes and also a federal cause of action for dilution. The District Court of Virginia held that the TTAB’s decision was supported by substantial evidence and found no likelihood of confusion or dilution. The TTAB and the District Court held that the marks SWATCH and SWAP were dissimilar in sight, sound and meaning and this was supported by substantial evidence. The evidence relied on were the trademarks, as well as definitions from the dictionary. Swatch argued that the District Court did not give enough weight to the “SWA” portion of the mark. However, this was not a persuasive argument because the analysis requires the fact finder to compare whole words not parts of words. Lastly, The TTAB, as well as the District Court found that there were significant differences in trade channels for the two marks.  Beehive directed its advertising to wholesale customers through magazines and trade show appearances, while Swatch utilized television, social media and billboards primarily to conduct advertising. Swatch was unable to produce a single incident of actual consumer confusion about the origin of the parties. The absence of actual confusion creates an inference that there is no likelihood of confusion between the marks.

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One unusual aspect of trademark law is the existence of a dual legal system to resolve disputes.  Litigants can choose to resolve their disputes through the United States Patent & Trademark Office’s Trademark Trial and Appeal Board (TTAB) or initiate an action in the Federal court system.  The TTAB is an administrative court that makes determinations regarding registrations, while the Federal Courts rule over issues concerning infringement and rights to use trademarks. The results of the two systems can sometimes be inconsistent.  However, this landscape could change soon because the U.S. Supreme Court has been asked to provide guidance on the issue, should Federal Courts be bound by TTAB rulings related to likelihood of confusion issues?

In a recently filed petition, B&B Hardware, Inc. claims that the lower district court and the Eighth Circuit did not defer to the TTAB holding that there was a likelihood of confusion between its registered mark SEALTIGHT and another  similar mark (SEALTITE) for related goods. The district court did not even allow the TTAB decision into evidence for fear it would prejudice the jury. The Eighth Circuit also rejected the TTAB’s decision.  See B&B Hardware, Inc., v. Hargis Industries, Inc., Appeal No. 11-1247 (8th Cir. May 1, 2013).  In its petition to the U.S. Supreme Court, B&B Hardware, Inc. argues that the Eighth Circuit’s rejection of the TTAB findings bolsters the circuit split. B&B Hardware, Inc. further argues that the TTAB finding on likelihood of confusion should have been given preclusive effect.

If you have not been following this case, a brief overview of the facts follows: the prior user of the trademark SEALTIGHT, for fasteners in the aerospace industry (B&B Hardware, Inc.), argues that Hargis Industries’ mark SEALTITE for self drilling screws in the the construction industry causes a likelihood of confusion in the marketplace. The TTAB agrees with B&B Hardware, Inc. and rules that Hargis Industries can not register SEALTITE for self drilling screws. In the end, the current circuit split on the issue, should federal courts be bound by TTAB rulings related to likelihood of confusion, makes it ripe for supreme court adjudication. See B&B Hardware, Inc., v. Hargis Industries, Inc., Case No. 13-352 in the U.S. Supreme Court.

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