Monday, April 27, 2015

Fourth Circuit Rules That Plaintiff in Appeal from Ex Parte TTAB Decision Must Pay ALL Expenses

A divided panel of the United States Court of Appeals for the Fourth Circuit affirmed the decision of the U.S. District Court for the Eastern District of Virginia, upholding the lower court's ruling (Shammas v. Focarino, 109 USPQ2d 1320 (E.D. Va. 2014)) that, in a Section 1071(b) civil action for review of an ex parte TTAB decision, the plaintiff/applicant must pay the PTO's expenses (including attorney and paralegal fees). Dissenting Judge Robert Bruce King maintained that the American Rule (that each party pays its own expenses) should be applied absent “explicit statutory authority” for proceeding differently. Shammas v. Focarino, Appeal No. 14-1191 (4th Cir. April 23, 2014) [published].

The Lanham Act provides that a dissatisfied trademark applicant may seek review of a final refusal to register either via appeal to the CAFC under 15 U.S.C. §1071(a)(1), or by commencing a de novo civil action in a federal district court under §1071(b)(1). If the applicant proceeds in a district court, the applicant must name the Director of the PTO as a defendant and must pay "all the expenses of the proceeding," whether the final decision is "in favor of such party or not," unless the expenses are unreasonable. §1071(b)(3).

Here, Mr. Shammas lost in the district court, and the court awarded the USPTO $32,836.27 in attorney salaries, $3,090.32 in paralegal salaries, and $393.90 in photocopying expenses.

In his appeal to the 4th Circuit, Shammas acknowledged that the term "expenses" is a sufficiently broad term that "in ordinary parlance" includes attorneys fees. However, he argued that the district court erred in "shifting" the PTO’s attorneys fees to him, contrary to the American Rule under which each party bears its own attorneys fees, because the governing statute does not expressly provide for the shifting of attorneys fees.

The majority rejected this fee-shifting argument, observing that in "fee-shifting" statutes the fees are awarded to a party that has succeeded in its claim. Here, the majority concluded, the imposition of all expenses on a plaintiff in an ex parte proceeding, regardless of whether the plaintiff wins or loses, "does not constitute fee-shifting that implicates the American Rule but rather an unconditional compensatory charge imposed on a dissatisfied applicant who elects to engage the PTO in a district court proceeding." The majority confirmed that these "expenses" include the PTO’s salary expenses for the attorneys and paralegals who represented the Director.

The majority observed that a de novo civil action under § 1071(b)(1) results in a more complicated and expensive procedure than an appeal to the CAFC, where no new evidence is allowed and no discovery or other facets of civil litigation are permitted. In short, in a civil action for review, "the PTO is required to expend substantially greater time and effort and incur substantially greater expense than it would otherwise in an appeal to the Federal Circuit." Reviewing the legislative history of Section 1071(b)(3), the majority found that it was plainly meant to "incentivize[] trademark applicants to appeal routine trademark denials to the Federal Circuit."

In dissent, Circuit Judge King maintained that because §1071(b)(3) makes no reference to attorney’s fee awards, the American Rule should be followed. He noted that the words "attorney’s fees" are not found in §1071(b)(3), and he found no "clear support" for the award of such fees in the statute or its legislative history.

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TTABlog note: So if you are contemplating an appeal from an adverse TTAB ruling in an ex parte case, you might want to avoid the Fourth Circuit, if you can. Here's a question: does the USPTO now have a (reasonably) blank check to hire experts, conduct surveys, and take discovery in a §1071(b) civil action?

Text Copyright John L. Welch 2015.

Friday, April 24, 2015

Roberto Ledesma: "Google and the Kingdom of Tonga"

While perusing Google's U.S. application to register GOOGLE GLASS, Roberto Ledesma noted that the application claimed priority to an application filed in the Kingdom of Tonga. He decided to write about why Google did that, in his blog post called "Google and the Kingdom of Tonga."

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Text Copyright John L. Welch 2015.

Thursday, April 23, 2015

Precedential No. 13: TTAB Finds BUYAUTOPARTS.COM Generic for .... Guess What?

The Board affirmed a refusal to register BUYAUTOPARTS.COM on the Supplemental Register, finding the term to be generic for "on-line retail store service featuring auto parts." Applicant argued that the word "buy" does not identify a genus of services associated with "selling," but the Board didn't buy it. In re Meridian Rack & Pinion DBA, Serial No. 85504151 (April 21, 2015) [precedential].

The Board found the genus of services to be adequately defined by applicant's recitation of services. The relevant public consists of general consumers of auto parts. The question, then, was the public's understanding of the term, considered as a whole. When the proposed mark is a phrase, the Board cannot rely simply on definitions of the constituent words, but must analyze the meaning of the phrase as a whole. [See. e.g., American Fertility Society].

Applicant contended that BUYAUTOPARTS.COM does not name the genus of its services because "buy" does not identify a genus associated with "selling." At most, applicant argued, the applied-for mark describes the result or purpose of the services. The term would be generic "only if applicant purchased auto parts from others." According to applicant, "BUYAUTOPARTS.COM merely conveys the message that consumers may purchase auto parts from Applicant online, if consumers desire to do so, but does not describe Applicant's 'selling.'" [Huh? Say again? - ed.].

The Board found applicant's arguments unpersuasive. First, more than one term may be generic with regard to a particular product or services. Second, the central focus of any retail sales service is to facilitate "buying." In short, "buying" is directly related to "selling." [And vice versa - ed.]. The Board has often held that a term that names the "central focus" or "key aspect" of a service is generic for that service. [E.g., HOTELS.COM for lodging information and reservation services; TIRES TIRES TIRES for retail tire stores; RUSSIANART or selling such art].

The evidence showed that applicant offers its auto parts for sale online by advertising "Buy Auto Parts." Thus "buying" is a central focus of applicant's services. The record also showed that relevant consumers understand "buy auto parts" to refer to the transactions that are the central focus of applicant's services, and that third parties who sell auto parts tell their customers to "Buy Auto Parts Online."

Applicant feebly conceded that the term "BuyAutoParts" can be seen as generic, but it maintained that the addition of ".com" changes the commercial impression of the phrase and creates a distinctive mark (even though applicant disclaimed the term ".com"). In any case, the Board observed that ".com" is widely understood to refer to online commerce, and therefore the entire term BUYAUTOPARTS.COM as a whole is generic for applicant's services.

Moreover, the addition of a top level domain indicator to the generic name of the central focus or subject matter of a services does not transform the composite phrase into a registrable mark. [E.g., "," "," "," ""].

Consequently, the Board found the applied-for mark to be incapable of distinguishing applicant's services, and thus ineligible for registration on the Supplemental Register under Section 23 of the Lanham Act.

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TTABlog note: WYHA?

Text Copyright John L. Welch 2015.

Wednesday, April 22, 2015

CAFC Affirms TTAB, Finds THE SLANTS Disparaging of People of Asian Descent

The CAFC affirmed the Board's decision [TTABlogged here] that upheld a refusal to register the mark THE SLANTS for "entertainment in the nature of live performances by a musical band," finding that the mark, when used in connection with applicant's services, would be perceived as disparaging to a substantial composite of the referenced group, namely persons of Asian descent, in violation of Section 2(a) of the Lanham Act. Circuit Judge Kimberly A. Moore provided "additional views" on the constitutionality of Section 2(a), suggesting that the Court should re-visit the CCPA's 1981 decision in In re McGinley in view of the subsequent evolution of First Amendment jurisprudence. In re Tam, Appeal No. 2014-1203 (Fed. Cir., April 20, 2015) [precedential].

The Slants album cover

The appellate court ruled that substantial evidence supported the Board's finding that the mark THE SLANTS likely refers to people of Asian descent. The fact that the term "slants" has some innocuous meanings makes it necessary to examine how the applicant uses the mark in order to determine its meaning. The Board relied on images from the band's website and Mr. Tam's own statement that in choosing the mark, he was "trying to think of things that people associate with Asians," in reaching its finding.

Substantial evidence also supported the Board's finding that THE SLANTS is likely to be perceived as "disparaging to a substantial composite of the referenced group." Dictionary definitions uniformly characterized the word "slant" as "disparaging, offensive, or an ethnic slur when used to refer to a person of Asian descent." A brochure published by the Japanese American Citizens League described the term "slant" as derogatory. New articles and blog posts discussing the band's name led to the cancellation of the band's performance at a conference for Asian youth.

As to the constitutionality of Section 2(a), the CAFC deemed that argument foreclosed by In re McGinley, which held that because the refusal to register a mark did not affect the applicant's right to use the mark, "[n]o conduct is proscribed, and no tangible from of expression is suppressed." Therefore the applicant's First Amendment rights were not abridged by the refusal to register.

Furthermore, the court ruled that Section 2(a) is not unconstitutionally vague, since the Board follows a well-established two-part test for disparagement. Nor was applicant's right to due process infringed, despite the registration of a slur like DIKES ON BIKES, because applicant had a full opportunity to prosecute his application and to appeal from the USPTO's final refusal. Moreover, each application must be examined on its own merits, and an error made in some other application cannot justify the improper registration of this applicant's mark.

Judge Moore provided 24 pages of "additional views," urging that "[i]t is time for this Court to revisit McGinley's holding on the constitutionality of Section 2(a)." She observed that there are three requirements for finding a violation of the First Amendment: (1) the speech at issue must be protected speech; (2) there must be governmental action that abridges that speech; and (3) the abridgement must be unconstitutional when analyzed under the appropriate legal framework.

Judge Moore maintained that a trademark constitutes a form of protected commercial speech because it identifies the source of a product or service and thus provides commercial information. Here, the mark THE SLANTS "does more that merely identify the band." Mr. Tam selected the name in order to "reclaim" and "take ownership" of Asian stereotypes. In short, "Mr. Tam and The Slants weigh in on cultural and political discussions about race and society that are within the heartland of speech protected by the First Amendment." [Compare the REDSKINS mark on that point - ed.].

Moreover, although the applicant may continue to use the mark, the absence of a registration is significant. As the Supreme Court recently said in B&B Hardware v. Hargis, "The Lanham Act confers important legal rights and benefits on trademark owners who register their marks." Moreover, protection of an unregistered mark under Section 43(a) is available only if the mark could have qualified for registration. Denial of registration "severely burdens use of such marks." "Section 2(a)'s content-based restrictions on registrability were adopted to reduce use of trademarks the government deemed unsuitable (such as those that disparage) - no doubt a chilling effect on speech."

Finally, Judge Moore noted that Section 2(a) has not been analyzed under the "unconstitutional conditions" doctrine: the government cannot deny access to a benefit because of the potential recipient's exercise of constitutionally protected free speech.

Federal trademark registration confers valuable benefits, and under Section 2(a), the government conditions those benefits on the applicant's choice of a mark. Because the government denies benefits to applicants on the basis of their constitutionally protected speech, the "unconstitutional conditions" doctrine applies.

Section 2(a) is viewpoint-discriminatory because it bars registration of disparaging speech but not terms that refer to a certain group in a positive or non-disparaging way. Therefore Section 2(a) is presumptively invalid and must satisfy strict scrutiny to be constitutional. Moreover, even if strict scrutiny does not apply, Section 2(a) cannot survive even the intermediate scrutiny applicable to any restriction on commercial speech.

Applying the Central Hudson test for commercial speech, Judge Moore found that the government "has not put forth any substantial interests that would justify Section 2(a)'s bar against disparaging marks." The fact that protected speech may be offensive does not justify its suppression. Striking down the Section 2(a) bar would not disrupt long-standing, well-balanced common law principles, because there are no such principles applying to disparaging (as opposed to scandalous or misleading) mark: Congress created new law when it banned registration of disparaging marks. And finally, issuance of a trademark registration does not amount to the Government's imprimatur regarding the mark.

And so, Judge Moore concluded:

We have yet to be presented with any substantial government interests that would justify the PTO's refusal to register disparaging marks. Without this, Section 2(a) cannot satisfy the Central Hudson test. It is time to revisit the holding in McGinley in light of subsequent developments in the law and the trademark registration funding regime.

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Text Copyright John L. Welch 2015.

Monday, April 20, 2015

CAFC Affirms TTAB: NOPALEA Merely Descriptive of Supplements Containing Nopal Juice

In an enervating yet precedential ruling, the CAFC affirmed the Board's decision (here) upholding a Section 2(e)(1) mere descriptiveness refusal of the mark NOPALEA as a trademark for dietary and nutritional supplements "containing, in whole or in substantial part, nopal juice." In re TriVita, Inc., Appeal No. 2014-1383 (Fed. Cir. April 17, 2015) [precedential].

Appellant TriVita argued that the addition of the letters EA to NOPAL makes the mark NOPALEA substantially different in sight and sound. The CAFC observed, however, that "nopalea" is not a made-up word obtained by adding arbitrary letters. The record showed, and the Board found, that "nopalea" is a genus of cacti from which nopal juice is derived.

TriVita contended that the ordinary purchaser of its products will be of low botanical sophistication and will not immediately recognize the botanical meaning of the word "nopalea." However, the court agreed with the Board that there is "abundant evidence, scientific and non-scientific, of the words 'nopalea' and 'nopal' being used interchangeably," largely in the context of discussions of the health benefits of this class of cactus.

The Board found that the relevant consumer, knowing that the goods are supplements containing nopal cactus juice, would understand the mark NOPALEA to convey information that the goods contain ingredients from the Nopalea cactus. The Board based its finding on evidence that “nopalea” is the name of a genus of cacti used in food and supplements, that the word “nopal” is a common name for prickly pear cacti including cacti in the genus Nopalea, and that the words “nopal” and “nopalea” are used interchangeably to refer to cacti of that genus. Substantial evidence supports the Board’s findings, and its conclusion that “nopalea” is merely descriptive of TriVita’s goods.

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Text Copyright John L. Welch 2015.

Friday, April 17, 2015

Five Presentations from the Trademark Office Comes to California

Here are five PowerPoint presentations from the Trademark Office Comes to California program, held this week in Los Angeles and San Francisco.

Chief Judge Gerard F. Rogers and Deputy Chief Judge Susan Richey, The State of the TTAB the Evolution of Board Proceedings

Judges Ellen Seeherman and Lorelei Ritchie, Practice Tips from the TTAB

Commissioner for Trademarks Mary Boney Denison (keynote address), The State of the Trademark Office

Commissioner for Trademarks Mary Boney Denison and Sharon Marsh, Commissioner for Examination Policy, Hot Topics from the Patent and Trademark Office

Dr. E. Deborah Jay, President/CEO, Field Research Corporation, and Dr. Jerry Ford, Ford Bubala & Associates, Mark My Words: Contemporary Trademark Surveys

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Text Copyright John L. Welch 2015.

Thursday, April 16, 2015

Meet the Bloggers XI: Monday, May 4th, 8 PM, Henry's Pub

MEET THE BLOGGERS, perhaps the best non-INTA event ever devised by woman or man, will be held for the eleventh time (XIth), on Monday, May 4th, at 8 PM. at Henry's Pub and Restaurant, 618 Fifth Avenue, in San Diego (Henry's was the site of the first MtB). Come and meet some of the best trademark attorneys in the world, and while you're at it say hello to the sponsors of this year's event. For details, directions, a look at the sponsoring bloggers, and the RSVP link, go here.

MEET THE BLOGGERS I, San Diego, May 2005
Click on photo for larger picture

PS: Can you name the movie from which the name MEET THE BLOGGERS was derived?

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TTABlog note: No, it wasn't "Night of the Living Dead."

Text Copyright John L. Welch 2015.

Wednesday, April 15, 2015

TTAB Test: Is SUNRISE for Guitar Picks Confusable With PUKANA LA for Guitars?

The USPTO refused registration of the mark SUNRISE for guitar picks, finding the mark likely to cause confusion with the registered mark PUKANA LA & Design for guitars (shown below). The English translation of the Hawaiian term "pukana la" provided in the registration is "sunshine, sunrise." The examining attorney contended that the marks have the same connotation under the doctrine of foreign equivalents. Applicant argued that the doctrine should not be applied because Hawaiian is not a "common, modern" language. How do you think this came out? In re Christopher A. Fahey, DBA Gravity Guitar Picks, Serial No. 86250337 (April 13, 2015) [not precedential].

Both applicant and the examining attorney argued that the similarity or dissimilarity of the marks was dispositive. As to the doctrine of foreign equivalents, the Board observed:
Under the first du Pont factor, we focus on the similarity or dissimilarity of the marks in their entireties as to appearance, sound, connotation and commercial impression. Yet, when focusing on the perceptions of ordinary American consumers who are multilingual, we are tasked with calibrating a bewildering balance – namely weighing (1) the closeness with which the non-English-language term denotes the putative equivalent term in the English-language, against (2) the quite obvious and inevitable differences of sight and sound involved in comparison.

The Board found that Hawaiian is clearly a modern language. Despite colonial attempts to eradicate the language, Hawaiian remains viable and important to the Hawaiian people. It cannot be equated with a deal language like Ancient Greek.

However, the doctrine of equivalents will not be applied when the language is obscure - when it is "not spoken by an appreciable number of individuals sufficient to sustain a finding of a likelihood of
confusion." The Board agreed with applicant that Hawaiian does not fit the bill:

The record herein shows that approximately eighteen thousand Hawaiian language speakers live in the state of Hawaii and seven thousand more Hawaiian speakers live elsewhere in the United States. Moreover, there is substantially no population of Hawaiian speakers elsewhere around the globe.

Therefore, since the doctrine of equivalents is not applicable, the Board found the marks to be "totally dissimilar and it reversed the refusal to register.

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TTABlog note: How do you say "congratulations" in Hawaiian to FOB Paul Reidl for this victory? The entire opinion is three-pages long but right on target.

Text Copyright John L. Welch 2015.

Tuesday, April 14, 2015

TTAB Reverses BRUTOPIA BREWERY Refusal, Finding Pubs Not Related to Beer Festivals

Applicant Grill 505 came away with its glass half full in this appeal from a Section 2(d) refusal to register BRUTOPIA BREWERY for "beer" and for “pubs” [BREWERY disclaimed]. As to beer, the Board found the mark likely to cause confusion with the registered mark BREWTOPIA for “providing beer events and beer festivals; and providing online information regarding the beer events and beer festivals.” But evidence was lacking to show that applicant’s pubs are related to registrant’s beer event services. In re Grill 500 LLC, Serial No. 85951305 (March 31, 2015) [not precedential].

Not surprisingly, given the disclaimer of BREWERY in the applied-for mark, the Board found the involved marks to be similar in appearance, sound, connotation, and commercial impression. Applicant conceded as much in its brief on appeal.

Turning to the goods and services, the Board found, on the face of the respective identifications, that applicant’s beer and registrant’s services are complementary. Applicant’s beer could be purchased or sampled at registrant’s festivals, or could be the subject of registrant’s information regarding festivals. According to the USPTO’s website evidence, the principal subject of beer festivals is a wide variety of beers. [No kidding? ed.].

Applicant lamely argued that its beers are artisan craft beers local to the State of Rhode Island, whereas registrant’s services are not offered in connection with a brewery. The Board, of course, pointed out that there are no geographical restrictions in the application or cited registration, and that the involved services need not be identical but merely related in order to find confusion likely.

Applicant feebly asserted that consumers for the involved goods (applicant’s local craft beer sold only in a pub setting), and services would be highly sophisticated, thus minimizing the likelihood of confusion. The Board noted that applicant’s beer is relatively low priced, and that consumers of registrant’s services will include ordinary seeking to taste a variety of beers, without any particular level of sophistication. In any event, even sophisticated consumers may be confused when substantially similar marks are used on closely related goods and services.

However, the Board found no evidence to support the assertion that pubs are related to registrant’s services. The single webpage submitted by the examining attorney did not demonstrate the relatedness of the services.

The fact that breweries showcase their beer at beer events and festivals simply does not demonstrate that consumers who frequent both pubs and beer events and beer festivals will mistakenly believe that both types of services emanate from a common source, or otherwise are commercially related, even when the respective services are offered under similar marks.

The Board therefore affirmed the refusal as to applicant’s beer, but reversed the refusal as to pubs.

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Text Copyright John L. Welch 2015.

Monday, April 13, 2015

WYHA? PUP SCOUTS and DOG SCOUTS OF AMERICA Confusable for Pet Services, Barks TTAB

The USPTO refused registration of PUP SCOUTS as a collective membership mark for "indicating membership in an organization for pets and their human counterparts," finding it likely to cause confusion with the registered mark DOG SCOUTS OF AMERICA, in standard character and design form, for retail store, educational, and association service in the field of pet training and pet parenthood and ownership [DOG and AMERICA disclaimed]. Applicant pointed out that registrant's services are offered only in certain states and certain channels of trade, and differ in kind from applicant's membership services. Would you have appealed? In re Pup Scouts, LLC, Serial No. 86048207 (April 2, 2015) [not precedential].

The Board began by noting that the Section 2(d) analysis for a collective membership mark is somewhat different than that for a service mark because the former does not involve purchasers or users of goods and services. A collective membership mark "serves only to identify the fact that such members belong to the collective organization and to inform relevant persons of the members’ association with the organization." The "relevant persons" for Section 2(d) are the persons for whose benefit the membership mark is displayed.

Thus, in the case of Applicant’s collective membership mark and Registrant’s service mark, the question is whether relevant persons are likely to believe that the collective organization, i.e., Applicant, is endorsed by or in some way associated with the provider of the association services.

The Board found it clear, on the face of the application and cited registration, that applicant's organization and registrant's services "both involve pets and their owners." The fact that applicant offers memberships for the benefit of pets and their owners, while registrant offers its services directly to pets and their "human counterparts" does not detract from "the clear and obvious nexus on the face of the identifications."

Applicant feebly argued that registrant's service, according to its website, are limited to certain states and certain channels of trade. But applicant was barking up the wrong tree. [Apologies. - ed.] But there were no such restrictions in the cited registration.

As to the marks, the Board found that both "give the commercial impression of a dog or young dog that is a scout," and suggest an organization similar in style to the Boy Scouts or Girl Scouts, or an association, focusing on dogs. The Board concluded that the marks are extremely similar in meaning and overall impression, though not so much with regard to sight and sound.

Applicant's founder declared that applicant attracts highly sophisticated dog owners [the owners, not the dogs - ed.] who want to honor their pets. The Board noted, however, that there was no evidence as to the price range for registrant's services or applicant's memberships, and there were no limitations in the application or registration as to type of consumer. Potential customers and members would include all dog owners, sophisticated or not.

The Board therefore found confusion likely, and it affirmed the refusal.

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TTABlog note: What about CAT SCOUTS?

Text Copyright John L. Welch 2015.