USPTO issues Examination Guidelines for Post-Farm Bill Examination of Trademarks for Cannabis and Cannabis-Related Goods and Services

      

After months of uncertainty regarding how the U.S. Patent and Trademark Office (“PTO”) was going to be handling trademark applications that recite cannabis-related goods and services following the enactment of the 2018 Farm Bill, the PTO issued Examination Guide 01-19 on May 2, 2018 to provide some guidance for trademark applicants and trademark attorneys moving forward.

Prior to the enactment of the 2018 Farm Bill, the PTO typically refused registration of any trademark application the basis that use of a mark in connection with anything relating to cannabis was a violation of the federal Controlled Substances Act (CSA), and therefore, the mark was not in lawful use in commerce (nor could the applicant have had a bona-fide intent to use such mark in lawful commerce).

However, on December 20, 2018, 2018 Farm Bill was signed into law and amended the CSA to remove hemp from the definition of marijuana, and thus cannabis plants and derivatives (most notably CBD) that contain no more than 0.3% tetrahydrocannabinol (THC) on a dry-weight basis are no longer controlled substances under the CSA.

For trademark applications filed on or after December 20, 2018 which identify cannabis-related goods (including CBD), the 2018 Farm Bill now removes the CSA as a ground for refusal of registration so long as the goods are derived from “hemp.” Nonetheless, the PTO will require the identification of goods to specify that they contain less than 0.3% THC so that the goods set forth in the trademark application are compliant with federal law.

However, for applications filed before December 20, 2018 that identify goods encompassing cannabis-related products or CBD, registration will be refused due to the unlawful use or lack of bona fide intent to use in lawful commerce under the CSA on the date the application was filed. The PTO maintains that such pre-Farm Bill applications did not have a valid basis to support registration at the time of filing because the goods violated federal law at the time.

However, because the goods are now potentially lawful if they are derived from “hemp” and contain less than 0.3% THC, the PTO will be allowing applicants the option of amending the filing date and filing basis of the application to overcome the CSA as a ground of refusal.  Applicant’s will have to specifically state for the record that such a change to the filing date is being authorized and must establish a valid filing basis under 37 C.F.R. §2.34 by satisfying the relevant requirements. If the application was originally filed based on Section 1(a) use-in-commerce, then applicants will have to amend the basis to instead be based on Section 1(b) intent to use – presumably followed by a subsequent filing of an amendment to allege use. [Comment – this is what the Examination Guideline states regarding use-in-commerce , but I’ve personally reached out to the PTO regarding this point as it seems that if the applicant is amending the filing date, but the applicant can claim use-in-commerce as of that December 20, 2018 filing date, then why can’t the applicant leave the application basis as Section 1(a) use-in-commerce based on the new filing date … to be continued.]

Applicants will also be required to amend the identification of goods to specify that the CBD or cannabis products contain less than 0.3% THC. The PTO also appears to be recommending that in lieu of amending the filing basis, applicants could simply abandon its old application and file a new one.

However, even though cannabis-related goods may now be legal under the CSA, the PTO notes that not all goods for CBD or hemp-derived products are lawful following the 2018 Farm Bill. Most notably, the use of CBD in foods or dietary supplements may still violate the Federal Food Drug and Cosmetic Act on the basis that the use of a drug or substance undergoing clinical investigations (as CBD currently is since it is an active ingredient in FDA-approved drugs and is a substance undergoing clinical investigations) without approval of the U.S. Food and Drug Administration (FDA) violates the FDCA. The 2018 Farm Bill explicitly preserved FDA’s authority to regulate products containing cannabis or cannabis-derived compounds under the FDCA. Thus, registration of trademarks for foods, beverages, dietary supplements, or pet treats containing CBD will still be refused as unlawful under the FDCA, even if derived from hemp, as such goods may not be introduced lawfully into interstate commerce.

Gatorade's Fair Use Defense Defeats SportFuel Trademark Infringement Lawsuit

On June 14, 2018, the U.S. District Court for the Northern District of Illinois granted summary judgment in favor of PepsiCo, Inc. and its subsidiary, The Gatorade Company (“Gatorade”), against the trademark infringement claims brought by SportFuel, Inc. (“SportFuel”), the owner of the registered trademark SPORTFUEL, over Gatorade’s use of the advertising slogan “The Sports Fuel Company.”  SportFuel, Inc. v. PepsiCo, Inc. et al, Case No. 16-cv-07868 (N.D. Ill. 2018) (decision here).

SportFuel is a Chicago-based sports nutrition and wellness consulting firm that also sells a variety of SportFuel-branded dietary supplement powders and capsules.  SportFuel owns two registered trademarks for the name SPORTFUEL – one for “food nutrition consultation,” “nutrition counseling,” and “providing information about dietary supplements and nutrition” (U.S. Trademark Registration No. 3,495,513) and another for “dietary supplements” and “sports drinks enhanced with vitamins” (U.S. Trademark Registration No. 4,832,297).

Gatorade began using the phrase “sports fuel” internally in 2012 in marketing presentations describing their “Sports Fuel” products (which it defined as products designed to improve athletic performance in contrast to sports nutrition products) and describing the growing “Sports Fuel” product market.  In 2015, with full knowledge of SportFuel’s trademark rights, Gatorade began a nationwide rebranding campaign using the slogan “Gatorade The Sports Fuel Company.”  Gatorade obtained a trademark registration for GATORADE THE SPORTS FUEL COMPANY in 2016 (Reg. No. 5,025,026) – although it included a disclaimer of any exclusive rights to “The Sports Fuel Company” apart from the mark as shown in response to an office action which found “The Sports Fuel Company” to be merely descriptive.  Gatorade maintained that it did not use the slogan on any product packaging or labeling – rather, its products used the GATORADE trademark or the G-bolt design mark. 

SportFuel filed its lawsuit against Gatorade and PepsiCo in August 2016 alleging causes of action for trademark infringement, unfair competition, and false designation of origin in violation of the Lanham Act as well as related claims of trademark infringement and unfair competition under state law and common law.  Gatorade filed a motion for summary judgment on all of SportFuel’s claims on two separate grounds – 1) SportFuel has not presented evidence from which a reasonable jury could find likelihood of confusion (a necessary element to all of SportFuel’s claims) and 2) Gatorade’s use of the term “Sports Fuel” in the slogan “Gatorade The Sports Fuel Company” is protected under the fair use doctrine.  The court granted Gatorade’s motion entirely on the grounds of fair use and did not address the likelihood of confusion argument. 

The court first identified the fair use defense and its elements:

Under section 1115(b)(4) of Lanham Act, however, the “fair use” defense allows a junior user of a mark to use the mark “in good faith in its descriptive sense, as opposed to its trademark sense.” Ideal Indus., Inc. v. Gardner Bender, Inc., 612 F.2d 1018, 1027 (7th Cir. 1979); see also 15 U.S.C. § 1115(b)(4); Sorensen v. WD-40 Co., 792 F.3d at 722. The fair use defense “is based on the principle that no one should be able to appropriate descriptive language through trademark registration.” Packman, 267 F.3d at 639 (citation omitted). To prevail on a fair use defense, the defendant must show that (1) it did not use the mark as a trademark; (2) the mark is descriptive of the defendant’s goods or services, and; (3) it used the mark “fairly and in good faith.” Sorensen, 792 F.3d at 722.

With respect to the first element of the fair use defense – showing that it did not use “Sports Fuel” as a trademark – Gatorade argued that it used the term “Sports Fuel” in its slogan “Gatorade The Sports Fuel Company” to describe the type of products it sells rather than to signify the source of the products.  Even though there was no dispute that Gatorade uses its name and G-bolt design mark on its product packaging and advertising, this did not preclude a finding that Gatorade’s use of the words “Sports Fuel” could be viewed as a source identifier of Gatorade’s products.  Nonetheless, in analyzing Gatorade’s actual use of the slogan “The Sports Fuel Company,” the court focused heavily on how the word “Gatorade” typically appeared above the slogan and in a much more noticeably larger and bolder font.  And in those instances where the word “Gatorade” appeared on the same line and in the same font as the slogan, the word “Gatorade” was bolded so that it would stand out from the slogan.

  

The court found that “The fact that the Gatorade house mark appears more prominently than the rest of the slogan reduces the likelihood that Gatorade is using “Sports Fuel” as an indicator of source.”  The court rejected SportFuel’s argument that a Gatorade executive had admitted using “Sports Fuel” as a trademark given that he was not a trademark expert and just giving an opinion.  Moreover, the fact that Gatorade had sought to register “Gatorade The Sports Fuel Company” as a trademark did not change the court’s analysis given Gatorade’s express disclaimer of “The Sports Fuel Company” as part of its trademark registration. 

With respect to the second element of the fair use defense – showing that Gatorade’s use of “Sports Fuel” was in a manner which is descriptive of its goods or services – Gatorade’s argument that its use of “Sports Fuel” would clearly be recognized by consumers as descriptive of “foods and beverages designed to be consumer before, during, or after sports activity” was bolstered by the fact that the PTO had also determined that the phrase “The Sports Fuel Company” was descriptive and had to be disclaimed by Gatorade in its trademark registration application (“As SPORTS FUEL is commonly used in reference to sports nutrition, consumers encountering the wording THE SPORTS FUEL COMPANY in the proposed mark would readily understand it to mean that the goods are provided by a company that provides sports nutrition.”). In addition, Gatorade’s internal marketing documents regarding the slogan “The Sports Fuel Company” had identified “Sports Fuel products” as “[i]tems specifically designed to improve athletic performance.”  As such, the court found that Gatorade’s use of “Sports Fuel” was in a manner which is descriptive of its goods or services and further found that SportFuel had not presented any evidence giving rise to a genuine factual dispute regarding whether Gatorade used the term “Sports Fuel” to describe the nature of the products it sells.

Finally, with respect to the third element of the fair use defense – showing that Gatorade used “Sports Fuel” fairly and in good faith only to describe its own goods or services – Gatorade argued that there was no genuine factual issue in dispute given that “sports fuel” did accurately describe Gatorade’s expanded product line, Gatorade disclaimed exclusive rights to “The Sports Fuel Company” in its registered trademark, and the concurrent use of its famous GATORADE mark and/or G-bolt design mark in conjunction with the advertising slogan left no doubt regarding the source of Gatorade’s products. 

SportFuel tried to argue that summary judgment was not warranted on the issue of Gatorade’s intent and good faith because Gatorade was aware of SportFuel’s marks prior to beginning public use of its slogan and because Gatorade did not stop using the slogan even after SportFuel had put Gatorade on notice regarding its claims of infringement.  However, the court held that “evidence that Gatorade had knowledge of SportFuel’s mark is insufficient to permit a reasonable inference of bad faith” and Sport Fuel “must point to something more that suggests subjective bad faith.”  Further, the court held that “the fact that Gatorade did not stop using the slogan after SportFuel filed this lawsuit alleging infringement is not probative of bad faith” since Gatorade believed its use did not constitute infringement and there had been no prior adjudication of the issue.  The court found that SportFuel failed to offer any evidence that would support a reasonable inference that Gatorade acted in bad faith.

The court concluded that even with all reasonable inferences drawn in SportFuel’s favor, “no reasonable jury could find that Gatorade’s use of the phrase “Sports Fuel” in its slogan “Gatorade The Sports Fuel Company” is anything other than a fair use.”  As such, the court concluded that Gatorade’s use of “Gatorade The Sports Fuel Company” is protected under the fair use doctrine and granted summary judgment in Gatorade’s favor on all of SportFuel’s claims.  And having granted summary judgment based on fair use, the court chose not to address the parties’ arguments on the issue of likelihood of confusion.  See KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 124 (2004) (a defendant invoking the fair use defense need not establish that its use of the mark in question will not cause consumer confusion).

Court finds no abandonment of ATLA mark by American Association for Justice

The American Association for Justice (“AAJ”) (formerly the Association of Trial Lawyers of America) won a signfiicant victory in its trademark infringement lawsuit against The American Trial Lawyers Association (“TheATLA”) (previous blog posts here and here) when the court found that the AAJ had not abandoned its trademark rights to the ATLA mark despite having intentionally made the decision to change its name from ATLA to AAJ. See American Association for Justice v. The American Trial Lawyers Association et al, Case No. 07-cv-04626, 2010 U.S. Dist. LEXIS 25325 (D. Minn. March 18, 2010). Law.com article here.

TheATLA tried to argue that AAJ abandoned its rights to ATLA when it made the decision to change its name. In ruling against TheATLA, the court noted the following:

[A] prospective intent to abandon a mark does not establish abandonment. Electro Source, LLC v. Brandess-Kalt-Aetna Group, Inc., 458 F.3d 931, 937 (9th Cir. 2006). Rather, “abandonment requires complete cessation or discontinuance of trademark use.” Id. at 938. A single bona fide use of a mark “‘is sufficient against a claim of abandonment.’” Id. (quoting Carter-Wallace, Inc. v. Procter & Gamble Co., 434 F.2d 794, 804 (9th Cir. 1970)). If use of the trademark is not actually discontinued, “the intent not to resume use prong of abandonment does not come into play.” Id. at 937-38. Because abandonment constitutes a forfeiture of a property right, it “must be strictly proved” by the party seeking abandonment. See Iowa Health Sys., Inc. v. Trinity Health Corp., 177 F. Supp. 2d 897, 918 (N.D. Iowa 2001) (quotation marks omitted).

The court found that after the official name change in December 2006, AAJ continued to identify itself as “formerly the Association of Trial Lawyers of America” on its website, in advertisements, and mailings to prospective members:

Such use of the designation “formerly” to capitalize on the goodwill and source identification of the marks constitutes bona fide use. Cf. First Fed. Sav. & Loan Ass’n of Council Bluffs v. First Fed. Sav. and Loan Ass’n of Lincoln, 929 F.2d 382, 385 (8th Cir. 1991) (“The new savings and loan plans to capitalize on First Federal Council Bluffs’ good name by advertising itself as the ‘former First Federal.’ This [may] support a continuation of the injunction [prohibiting the defendant’s use of First Federal] for as long as the identification with the former institution is used by the new owners.”); Alliant Energy Corp. v. Alltel Corp., 344 F. Supp. 2d 1176, 1187 (S.D. Iowa 2004) (“Despite a name change, a trademark may still possess significant goodwill and remain a valuable asset to a company. . . . Even in cases such as the present one, where there are extensive efforts to notify the public of the name change, there is still the possibility that goodwill remains in the marks.”).

The court found this evidence alone warranted summary judgment in favor of AAJ and against TheATLA on TheATLA’s affirmative defense of abandonment. The court further reinforced its decision by noting that AAJ had continued to license ATLA to at least one licensee who has continuously used the mark, several publications continued to be published using the ATLA mark, and AAJ maintained the www.atla.org and www.atlanet.org websites to direct users to the organization’s new website (which capitalized on the source identification and goodwill of the ATLA mark by directing those individuals who were drawn to the website by the ATLA mark to the new AAJ website).

With the exception of the issue of abandonment, the court denied the summary judgment motions filed by both sides. The case now moves on to trial.

Second Circuit Overturns Google’s District Court Victory on Trademark Keyword Sales

Yesterday I posted (link here) about a Massachusetts district court decision finding that a party’s purchase of a trademarked keyword to trigger sponsored links constitutes a "use" within the meaning of the Lanham Act. That court’s decision noted that the “the Second Circuit stands alone in holding that the purchase of a competitor's trademark to trigger internet advertising does not constitute a use for the purposes of the Lanham Act.” (emphasis in original).

Today, the Second Circuit appears to have decided to join the other Circuits which have held that the purchase of trademarks to trigger sponsored links on a search results page is a "use" under the Lanham Act (while at the same time distinguishing, and drastically limiting its prior decision in 1-800 Contacts, Inc. v. WhenU.Com, Inc., 414 F.3d 400 (2nd Cir. 2005) which heretofore had been relied upon by many trademark attorneys and Second Circuit district courts as the basis for dismissing trademark infringement lawsuits involving keywords).

In Rescuecom Corp. v. Google Inc., No. 06-4881-cv (2nd Cir. April 3, 2009), the Second Circuit reversed a lower court’s decision to dismiss Rescuecom’s trademark infringement action against Google Inc. under Rule 12(b)(6) for failure to state a claim on the grounds that Google did not use Rescuecom’s trademark in commerce within the meaning of the Lanham Act. The decision received a plethora of media coverage (NY Times, WSJ, Law.com, ZDnet, PC World, Techcrunch).

The Second Circuit held that Rescuecom’s allegations that Google’s recommendation and sale of Rescuecom’s trademark to Google Adword advertisers in order to trigger sponsored links in a manner that could likely cause consumer confusion from Google search engine user searching Rescuecom’s trademark were sufficient to allege a claim under the Lanham Act (i.e., such allegations were sufficient to allege that Google’s use of Rescuecom’s trademark was a “use in commerce” within the meaning of § 45 of the Lanham Act).

Eric Goldman provides his excellent overview of the impact of the court’s decision. Meanwhile, the Electronic Frontier Foundation paints its own dire picture of the implications of the decision on e-commerce.

In short, the Second Circuit appears to have brought to an end the debate about whether trademark keyword purchases and sales constitute “use in commerce” under the Lanham Act. With the Second Circuit now on board, all Circuits that have not previously addressed the issue will likely follow suit. The Second Circuit’s opinion even includes an Appendix discussing the phrase “use in commerce” in the Lanham Act (which while much more detailed and scholarly, nonetheless reaches the same conclusion as the Massachusetts district court did in the Hearts on Fire case yesterday).

And now the battle turns to where most trademark battles end up – addressing the issue of likelihood of confusion. The biggest defeat here is that purchasers and sellers of trademark keyword advertising can no longer get a trademark infringement lawsuit dismissed at an early state for failure to state a claim – and will instead have to endure some discovery and fight through to summary judgment or maybe even trial. The end result is that more parites will probably reach settlements earlier, and more online retailers will avoid purchasing another party’s trademarks as an advertising keyword which is the result that trademark owners ultimately wanted anyway.

Massachusetts District Court Finds Keyword Purchase Constitutes Trademark Use

A Massachusetts District Court has held that the purchase of a trademarked keyword to trigger sponsored links constitutes a "use" within the meaning of the Lanham Act. See Hearts on Fire Company, LLC v. Blue Nile, Inc., Case No. 08-cv-11053 (D. Mass. March 27, 2009).

I previously blogged about this case here. Hearts on Fire Company, LLC (“HOF”), the company behind the “Hearts On Fire” diamond (a/k/a The World's Most Perfectly Cut Diamond) (pictured above), filed a trademark infringement lawsuit against Blue Nile, Inc. (“Blue Nile”), an online retailer of certified diamonds and jewelry, based on Blue Nile’s purchase of the mark “Hearts On Fire” as webcrawler.com keyword which generated a Blue Nile sponsored link for searchers who searched for “Hearts On Fire”. Blue Nile had filed a Motion to Dismiss HOF’s complaint in part based on the argument that its purchase of the keyword “Hearts On Fire” was not trademark use.

After reviewing the conflicting circuit court decisions on the matter (the First Circuit Court of Appeals has yet to address this issue), United States District Judge Nancy Gertner, in denying Blue Nile’s Motion to Dismiss, decided to follow the Ninth and Tenth Circuit precedents on the purchase of trademarks triggering banner ads as constituting use under the Lanham Act (Playboy Enterprises, Inc. v. Netscape Commc'ns Corp., 354 F.3d 1020 (9th Cir. 2004); Australian Gold, Inc. v. Hatfield, 436 F.3d 1228 (10th Cir. 2006)) which have been applied by other district courts to the purchase of trademarked keywords to trigger sponsored links. See Boston Duck Tours, LP v. Super Duck Tours, LLC, 527 F. Supp. 2d 205, 207 (D. Mass. 2007) (finding keyword-purchasing a "use" for trademark purposes); J.G. Wentworth, S.S.C. Ltd. P'ship v. Settlement Funding LLC, 2007 WL 30115 (E.D. Pa. 2007) (finding trademark use in sponsored linking); Buying for the Home, LLC v. Humble Abode, LLC, 459 F. Supp. 2d 310 (D.N.J. 2006); Gov't Employees Ins. Co. v. Google, Inc., 330 F. Supp. 2d 700 (E.D. Va. 2004).

The Court noted that courts finding the purchase of keywords to be trademark "use" focused more on the broader definition of “use” in 15 U.S.C. § 1114 compared to the definition in the Lanham Act’s definition section (15 U.S.C. § 1127):

Rather than relying only on the Act's definitions section as the Second Circuit has done, see note 5, supra, these courts often look also to its civil remedies provision, which defines "use" more broadly. Compare 15 U.S.C. § 1127 (definitions section), with 15 U.S.C. § 1114 (civil remedies provision); see also Boston Duck Tours, 527 F. Supp. 2d at 207 (finding that "sponsored linking necessarily entails the 'use' of the plaintiff's mark as part of a mechanism for advertising," based on the statute's "plain language"). In particular, the civil remedies provision penalizes the "use in commerce" of "any reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services." 15 U.S.C. § 1114 (emphasis added); see also note 2, supra. The purchase of a competitor's trademark to trigger search-engine advertising is precisely such a use in commerce, even if the trademark is never affixed to the goods themselves. In effect, one company has relied on its competitor's trademark to place advertisements for its own products in front of consumers searching for that exact mark. The Lanham Act's use requirement is not so narrow or cramped that it would fail to treat this conduct as a "use in commerce."
Even the Act's definitions section, which pre-dates the advent of internet commerce and advertising, treats as a "use in commerce" any use of the trademark on "displays associated" with the goods offered for sale. 15 U.S.C. § 1127. On the facts of this case, by contrast to 1-800 Contacts, 414 F.3d 400, a computer user's search for the trademarked phrase necessarily involves a display of that trademark as part of the search-results list. For instance, if a computer user searches for the "hearts on fire" trademark at www.webcrawler.com, the text "Web search results for 'hearts on fire'" is prominently displayed above the search results, including the sponsored links. Indeed, this display is exactly what the Defendant paid for: the association of Blue Nile's sponsored link with the searched-for trademark.

(emphasis in original)

The court held that given the Lanham Act's language and the broader purposes of the trademark statute, “there is little question that the purchase of a trademarked keyword to trigger sponsored links constitutes a ‘use’ within the meaning of the Lanham Act.”

The court went on to find that HOF’s allegations were sufficient at this stage to state a claim for trademark infringement (including a claim of infringement based on initial interest confusion). Even though none of Blue Nile’s sponsored links displayed the “Hearts On Fire” mark, HOF alleged sufficient allegations that consumers would likely to be confused based on the surrounding context in which the results appear.

Vegas™Comments:
Another victory for trademark owners looking to go after sponsored link purchasers who buy trademarks as search engine keywords.

Fourth Circuit Affirms Lower Court Decision That OBX Creator Has No Trademark Rights To The Term

Pamela Chestek over at her blog Property, intangible discusses the Fourth Circuit’s recent decision in OBX-Stock, Inc. v. Bicast, Inc., No. 06-1769 (4th Cir. Feb. 27. 2009). The decision serves as a good reminder about the importance of using a trademark as a trademark.

Too many people not familiar with trademark law fail to appreciate that just because you come up with a unique word or slogan and affix that word or slogan to various goods (most often T-shirts or other souvenir items) does not mean that you are using the word or slogan as a trademark, especially in the case where the term is acknowledged to signify a specific geographic location. Trademarks are supposed to serve as source identifiers for a company’s goods and services – not as an identifier of something else for which you then use on goods and services.

As the court eloquentlystated in this case:

Trademark law, at a general level, protects the goodwill represented by particular marks, enabling consumers readily to recognize products and their source and to prevent consumer confusion between products and between sources of products. The marks enable consumers to make informed, independent decisions about quality and other product characteristics. But the law also protects the "linguistic commons" by denying mark holders an exclusive interest in words that do not identify goodwill attached to products or product sources but rather are used for their common meaning or meanings not indicative of products and product sources. See America Online, Inc. v. AT & T Corp., 243 F.3d 812, 821 (4th Cir. 2001); see generally 1 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 1:27 (4th ed. 2008).

In this case, the plaintiff (“OBX-Stock”) had coined the term “OBX” as a reference to the Outer Banks of North Carolina and made money selling products with OBX affixed thereon. The evidence showed that the public came to embrace OBX as a reference to the Outer Banks (thanks in part to OBX-Stock's sale of merchandise emblazoned with the OBX mark).

A company can obtain trademark rights over geographically descriptive marks with evidence of acquired distinctiveness. Of course, you must first use the mark as a source identifier – and not in its geographically descriptive sense. In this case, the court found that OBX-Stock affixed the letters OBX to stickers, souvenirs, and other sundries not to label an OBX brand product produced by OBX-Stock, but to indicate an association with the Outer Banks (i.e., OBX-Stock’s use of OBX on its souvenirs was always meant to be a reference the Outer Banks, and not to communicate that the souvenirs were produced by OBX-Stock).

In this case, the court found that the evidence indicated overwhelmingly that "OBX" is [ed. - OBX-Stock used OBX as] a geographically descriptive or generic term for the Outer Banks. Moreover, OBX-Stock had failed to show any evidence that any consumer associates OBX with its products or with OBX-Stock itself.

The court found that OBX-Stock had failed to show ownership of a valid trademark and therefore dismissed its trademark infringement lawsuit. [Interestingly, the entire lawsuit was brought because of the Defendant’s use of the mark “OB Xtreme” on some stickers. Given the outcome, one wonders if this particular suit against Bicast was the smartest decision.]

Curiously, even though the Court of Appeals affirmed the district court’s decision that "OBX" was either generic or a descriptive mark without secondary meaning, the court did not overrule the district court’s decision not to order cancellation of OBX-Stock’s trademark registrations. For OBX-Stock’s trademark registrations on the Principal Register based on Section 2(f), the court’s decision would appear to nullify the 2(f) basis for maintaining the registration.

The court noted that the district court had concluded that Bicast’s evidence did not conclusively establish that every one of OBX-Stock’s trademark registrations should be cancelled. The court also seems to fault Bicast for not having filed counterclaims seeking cancellation (and only arguing the point on summary judgment). The court justifies its decision by stating that “Bicast has received an adequate remedy through the district court’s summary judgment in its favor, and the court’s final adverse decision on trademark validity will preclude OBX-Stock’s marks from becoming incontestable.”

Of course, while this is good for Bicast, what about future parties who may be afraid of using the OBX mark (even in a geographically descriptive fashion) for fear of being sued by OBX-Stock.

Last year, the Third Circuit reversed a district court’s decision not to order the USPTO to enter a disclaimer of the term “Cocoa Butter Formula” (which was found to be generic) on the principal registration of the mark “Palmer's Cocoa Butter Formula.” See E.T. Browne Drug Co. v. Cococare Prods., Inc., Nos. 06-4543 & 06-4658, 2008 U.S. App. LEXIS 16585 (3rd Cir. August 5, 2008). While the lower court had declined to order relief under 35 U.S.C. § 1119 believing that it would not benefit the party requesting such relief, the Court of Appeals reversed stating “even if Cococare will not benefit from that disclaimer, we should not allow the absence of a disclaimer on the principal register to confuse a future business into believing that it may not use the term ‘Cocoa Butter Formula.’”

Similarly, in this case, future businesses should not be confused by OBX-Stock’s trademark registrations for the OBX mark into believing that they may not use the term OBX (particularly as a reference to the Outer Banks). In my opinion, the Third Circuit should have remanded the case back to the district court to order OBX-Stock’s trademark registrations (at least those on the Principal Register based on Section 2(f)) to be cancelled.

Cosmopolitan Loses "Reverse" Cybersquatting Claim But Trademark Infringement Claims Move On

I’ve previously written (here and here) about the lawsuits filed by 3700 Associates, LLC (“3700 Associates”) – the owner of the troubled (but still under construction) “The Cosmopolitan Resort & Casino” condo-hotel project in Las Vegas, Nevada – against a Florida domainer in a case that epitomizes reverse cybersquatting while at the same time exploring the boundaries of trademark law by claiming that a “web directory” website (those websites featuring a multiple click-through links) constitutes use in commerce for purposes of causes of action for trademark infringement and unfair competition (click here for previous blog entry on this type of trademark infringement litigation). Click here for Sept. 8, 2008 Las Vegas Sun article about the troubled project.

When we last left the story, 3700 Associates had its Nevada District Court case dismissed on jurisdictional grounds. 3700 Associates decided to refile its trademark infringement and cybersquatting lawsuit in Florida (to overcome personal jurisdiction problems) against Tim Griffin, Sr. and Griffin IT Median, Inc. (together “Griffin”) over Griffin’s ownership and use of the Internet domain name “cosmopolitanresort.com” which Griffin registered on or about August 15, 2003 – approximately 16 months before 3700 Associates began using the mark “Cosmopolitan” in connection with its planned condo-hotel project. See 3700 Associates, LLC v. Griffin et al, Case No. 08-cv-80158 (S.D. Fla. Feb. 14, 2008).

On October 6, 2008, U.S. District Court Judge Donald M. Middlebrooks granted in part and denied in part Griffin’s Motion for Summary Judgment. See 3700 Associates, LLC v. Griffin et al, 2008 U.S. Dist. LEXIS 79721 (S.D. Fla. Oct. 6, 2008)

As one would expect given the timeframe in which Griffin registered the domain name compared to when 3700 Associates announced its intent to use the Cosmopolitan name, the court dismissed 3700 Associates’ cybersquatting claim. 3700 Associates attempted to argue that “the fact that Defendants registered the Domain Name a little over a year before Plaintiff began its COSMOPOLITAN Marks is of no consequence to the analysis of whether Defendants violated the ACPA.” Well, the court begged to differ:

Contrary to Plaintiff's assertion, I find that this is a critical fact. It is evident to me--and agreed by all parties--that Plaintiff's Marks did not exist at the time that Defendants registered the domain name in August, 2003. Plaintiff weakly proposes that “[a]t the time Defendants registered the [Domain Name at issue], 'Cosmopolitan' was distinctive as a mark for resort services.” See id. at P 16. However, I find this to be a conclusory assertion unsupported by the record. The term “Cosmopolitan” is a descriptive word meaning “international,” “multinational, or “sophisticated.” Clearly, the term itself is not distinctive or famous standing alone in the context of resort services; arguably, it is most distinct in another context, as the title of a woman's magazine. Moreover, even assuming that Plaintiff has developed the term such that it has become distinctive or famous with regard to its Marks and resort services, this has only occurred since February 2005, approximately 16 months after Defendants registered the Domain Name. To prevail on an ACPA claim, the Act plainly requires that the plaintiff's mark is “distinctive” or “famous” at the time of registration of the domain name. According to the parties' agreed-upon timeline, I find as a matter of law that Plaintiff cannot prevail on its ACPA claim. Simply put, at the time that Defendants registered the Domain Name, Plaintiff's COSMOPOLITAN Marks were not distinctive or famous because the Marks did not exist, and the term “Cosmopolitan” standing alone was not distinctive or famous in real estate services.

(footnotes omitted) (emphasis in original)

Unfortunately for Griffin, however, the court denied summary judgment on 3700 Associates’ federal and common law trademark infringement and unfair competition claims on the basis of too many issues of material fact in dispute.

3700 Associates argued that Griffin was attempting to trade on 3700 Associates’ goodwill by using the domain name to host a directory website containing multiple advertising links, with pop-up advertisements that redirected consumers to various other Las Vegas-oriented websites. Griffin countered that its website did not constitute “use in commerce” of the Cosmopolitan mark because it does not compete with Plaintiff for the sale of hotel, resort, or condo services.

The court stated that while the Eleventh Circuit has quoted another court's language that establishing a web page on the Internet satisfies the Lanham Act's “in commerce” requirement (see Planetary Motion, Inc. v. Techsplosion, Inc., 261 F.3d 1188, 1195 (11th Cir. 2001) (quoting Planned Parenthodd Fed'n of Am., Inc. v. Bucci, 1997 WL 133313 (S.D.N.Y. 1997), aff'd, 152 F.3d 920 (2nd. Cir.), cert. denied, 525 U.S. 834 (1998)), the Eleventh Circuit has not yet “squarely” determined whether directory websites such as Griffin’s qualifies as a “commercial use” and other circuits have been split on the issue. As such, whether Griffin’s use of the domain name in connection with a web directory website constitute “use in commerce” remained an issue of material fact.

In addition, the court determined that there existed genuine issues of material fact as to whether 3700 Associates even possessed a valid mark for purposes of maintaining an infringement action against Griffin. While 3700 Associates attempted to argue that its COSMOPOLITAN marks were inherently distinctive, the court found that the evidence demonstrated that the marks were merely descriptive:

First, the words in the Marks consist of (1) “Cosmopolitan,” a term frequently used to describe a hotel or resort; and (2) “Resort and Casino” or “Resort Casino,” words that describe the goods that Plaintiff is providing. Second, evidence of myriad hotels and resorts around the world using the term “Cosmopolitan” indicates that the term is not a particularly innovative idea. Third, although not determinative, Plaintiff disclaimed the exclusive use of the terms in its trademark applications. Finally, Plaintiff has not had more than five years of continuous, exclusive use, as it first began promoting its resort hotel casino and condominiums in 2005.

(footnotes and citations omitted). As such, 3700 Associates faces the burden of showing evidence of secondary meaning prior to the date when Griffin began using its domain name (a date that also has yet to be ascertained) in order to maintain its infringement claims against Griffin.

The court did not even bother addressing likelihood of confusion given the other issues of material fact in dispute.

IP Today article highlights splits of authority in sponsored link trademark infringement cases

Intellectual Property Today published an article entitled “Multiple Splits of Authority Point Out the Need to Think Strategically in Sponsored Link and Other Internet Advertising Cases” which provides a nice summary of the confused state of court cases that have dealt with claims of trademark infringement by trademark owners against competitors who have purchased a trademark as a search engine keyword to trigger a “sponsored link” advertisement.

Court denies Texas International Property Associates' motion to dismiss Full Sail University’s lawsuit over the former's web directory website

On June 17, 2008, United States District Judge Joe Fish of the Northern District of Texas refused to dismiss a trademark infringement lawsuit brought by Full Sail, Inc. (“FSI”) against Dauben, Inc. (d/b/a Texas International Property Associates) (“TIPA” or “Dauben”) arising from Dauben’s registration of the domain name FULLSAILUNIVERSITY.COM and using it to feature a web directory page with multiple click-through links to other education institutions. See Full Sail Inc v. Dauben Inc et al, 2008 U.S. Dist. LEXIS 47278, Case No. 08-cv-00446 (N.D. Tex. June 17, 2008). For some background on Texas International Property Associates (a name that many large company’s dealing with cybersquatters and typosquatters readily recognize), read this article here (from The Dallas Morning News). For a previous post on the growing trademark infringement litigation over “click-through web directories,” click here.

FSI operates an educational institution in Winter Park, Florida, that specializes in careers in music, film, video games, design, animation, and the entertainment business. Since 1979, FSI has used the mark FULL SAIL in connection with its education services. FSI has registered the FULL SAIL mark for various goods and services including educational services; retail store services; film related textbooks, newspapers, newsletters and magazines; clothing items; and prerecorded films dealing with the operation of audio, video and digital media equipment. FSI has also filed several intent-to-use applications for the mark FULL SAIL UNIVERSITY for Retail store services and instructional manuals; Clothing items; Film related textbooks, newspapers, newsletters and magazines; and Motion pictures, video games, etc. On June 10, 2008, the PTO registered the mark FULL SAIL UNIVERSITY for educational services (although this was still a pending application for purposes of the court’s decision).

FSI filed its complaint against Dauben alleging federal trademark infringement under 15 U.S.C. § 1114, federal unfair competition under 15 U.S.C. § 1125(a), trademark dilution under 15 U.S.C. § 1125(c), cybersquatting under 15 U.S.C. § 1125(d), and related state law claims. FSI claims that consumers looking for FSI are misdirected to TIPA’s website and that TIPA is unfairly profiting from FSI’s name and reputation by using a name intended to cause confusion.

TIPA filed a motion to dismiss for lack of subject matter jurisdiction and for failure to state a claim upon which relief can be granted pursuant to Federal Rules of Civil Procedure 12(b)(1) and (b)(6). The court denied TIPA’s motion to dismiss on both grounds.

First, because determining the issue of federal question jurisdiction would require an investigation into the merits of FSI’s complaint of trademark infringement, unfair competition, dilution, and anti-cybersquatting provisions under the Lanham Act, the court assumed jurisdiction, turned its focus to whether FSI had stated a claim upon which relief can be granted, and denied TIPA’s motion to dismiss for lack of subject matter jurisdiction. See Montez v. Department of the Navy, 392 F.3d 147, 150 (5th Cir. 2004); Dell, Inc. v. This Old Store, Inc., 2007 U.S. Dist. LEXIS 73952, 2007 WL 2903845 at *1-2 (S.D. Tex. Oct. 3, 2007) (assuming subject matter jurisdiction in trademark dispute to decide the pending motion to dismiss for failure to state a claim).

Second, in arguing that FSI did not state a claim upon which relief could be granted, TIPA argued that FSI had not registered the FULL SAIL UNIVERSITY mark, but merely filed intent-to-use applications, which does not result in a vested property right that could be infringed upon and that TIPA’s prior use gave it priority over FSI’s later filed applications. The court rejected this argument noting that FSI’s claims of trademark infringement were also grounded in its federal registrations for the FULL SAIL mark.

TIPA attempted to argue that this mark alone would be insufficient to support a Lanham Act claim; however, the court noted that likelihood of confusion was the real issue and that “It is not a stretch for the court to envision a likelihood of confusion among consumers between the defendant's FULLSAILUNIVERSITY.COM website, which contains the plaintiff's mark, and the plaintiff's mark as it relates to educational services, and that is sufficient for the claim to survive at the 12(b)(6) stage.” The court also noted that arguments concerning the likelihood of confusion are premature because the necessary factual determination is inappropriate at the motion to dismiss stage.

The remainder of FSI’s were claims were found to have been properly pled with sufficient factual allegations that, if true, would support each of the claims, and therefore TIPA’s motion to dismiss such claims were denied.

A Trademark Two-for-Tuesday for Eleventh Circuit appeals: Use of trademark in Metatags upheld as infringement

In addition to the Eleventh Circuit’s decision late last week regarding the mark ANGEL FLIGHT (discussed here), there was another trademark related decision published yesterday by the Eleventh Circuit Court of Appeals in a case involving trademark infringement arising from the use of trademarked terms in website metatags. See North American Medical Corp. v. Axiom Worldwide, Inc., Case No. 07-11574 (11th Cir. April 7, 2008).

Eric Goldman on his Technology and Marketing Blog (link here) describes the decision as a “bizarre and frustrating ruling."

The lesson learned – to the extent that you insist on using trademarked terms in your website’s metatags, make sure that the words themselves are not displayed along with your website in the search engine results and make sure that the terms are used in such a way where they would be deemed comparative advertising. Of course, the safest course of action would be not to use trademarks in your metatags at all.

Second Circuit affirms lower court decision of no trademark infringement by American Express over “MY LIFE. MY CARD.”

The Second Circuit handed down a per curium decision today which underscores the distinction between copyright and trademark law. See American Express Co. v. Goetz, Appeal No. 06-2184 (2nd Cir. February 4, 2008) (per curiam). A copy of the decision can be downloaded here. News articles on the decision can be found at CNN and Forbes.

At issue in the case was American Express’ use of the slogan “MY LIFE. MY CARD.” in its celebrity driven marketing campaign featuring such celebrities as Tiger Woods and Ellen DeGeneres promoting their use of an American Express card. Goetz claimed that he had senior trademark rights to the slogan over American Express, but the Court of Appeals sided with American Express finding that Goetz had not used the slogan as a trademark, and thus did not have any senior trademark rights.

In the summer of 2004, Stephen G. Goetz, the president of Gardner Design Group, LLC (“Goetz”), while working as a corporate consultant for a company called Mez Design, came up with an idea to enable credit card customers to personalize their card by choosing a photograph to be printed on the face of the card. Goetz developed some proprietary software and sought to license or sell the software to credit card companies. To promote his idea to credit card companies, Goetz created the slogan “My Life, My Card.” On July 30, 2004, Goetz mailed a proposal to American Express with a line reading: "'My Life, My Card' American Express delivers personalized cards to its cardholders!" Goetz sent similar proposals to Mastercard, Citigroup, Kessler Financial Services, and Metavante. Goetz also set up an online demonstration of his personalized card concept which displayed the slogan My Life, My Card.. On September 7, 2004, Goetz registered the domain name http://www.mylife-mycard.com/ and the next day, filed a Section 1(a) application (although current basis is now Section 1(b)) with the USPTO to register the mark MY LIFE, MY CARD (for computer software for financial credit card and debit card content management). The mark was published for opposition on August 8, 2006, and an opposition filed by American Express the same day. See American Express Marketing and Development Corp. v. Stephen G. Goetz, Opposition No. 91172239 (T.T.A.B.). On November 3, 2005, Goetz also filed another Section 1(a) application to register the mark MY LIFE, MY CARD (for credit card marketing for others and credit card services), but prosecution has been suspended pending the disposition of two of American Express’ application as well as one application by Advanta (for MY CARD MY WAY) .

Also during the summer of 2004, American Express hired an ad agency named The Ogilvy Group to develop a new American Express marketing campaign. On July 22, 2004, Ogilvy proposed the “MY LIFE. MY CARD” concept to American Express, and after receiving a favorable response, developed several advertisements based around the slogan. Ogilvy's outside counsel conducted a preliminary trademark search on July 29th to determine the availability of the slogan as a service mark in the United States. This was followed by a full trademark search on July 31st (approx. two days before Goetz’s proposal to American Express was delivered). Neither search unveiled any references to Goetz.. On September 1, 2004, American Express registered the domain name http://www.mylifemycard.com/. On September 15, 2004, American Express filed a Section 1(b) intent-to-use trademark application with the USPTO to register the mark MY LIFE. MY CARD (for four classes of services including credit card services and travel agency services). The ad campaign with the “My Life. My Card.” slogan was formally launched in early November 2004.

When Goetz demanded that American Express cease and desist using the “My Life. My Card.” slogan, American Express filed a declaratory judgment action in the United States District Court for the Southern District of New York seeking a declaration that it has not misappropriated the slogan and that it was not infringing any trademark rights by Goetz. See American Express Company v. Goetz et al, Case No. 05 Civ. 01555 (S.D.N.Y. Filed February 4, 2005).

On February 24, 2006, District Court Judge Lewis A. Kaplan granted summary judgment in favor of American Express and dismissed Goetz's counterclaims for misappropriation and trademark infringement. The district court held that Goetz had no valid protectable trademark rights in his “My Life, My Card” slogan that were senior to American Express’s rights to MY LIFE. MY CARD. Goetz filed a timely appeal of the decision as well as a district court ruling denying his motion for greater discovery.

Goetz's argument on appeal was that the district court erred in ruling that he had not used the “My Life, My Card” slogan as a trademark. However, after reviewing the facts de novo, the Court of Appeals affirmed the district court’s ruling.

Trademark Use
In finding that Goetz did not use his the “My Life, My Card” slogan as a trademark, the court started its analysis by noting the difference between trademark law and copyright law – copyright law protects the content of a creative work, whereas trademark law protects the words, names, symbols or devices used to identify the creative work in the marketplace and to prevent confusion as to the source of the creative work. See 15 U.S.C. § 1127 and 17 U.S.C. §101, 102. In short, a mark that does not perform the role of identifying a source is not a trademark. See EMI Catalogue P'ship v. Hill, Holliday, Connors, Cosmopulos Inc., 228 F.3d 56, 64 (2nd Cir. 2000).

The court noted that a mark can be a creative work by one person and a source identifier by another. When an ad agency develops a slogan for a client, the slogan is the ad agency’s creative work, while the client’s use of the slogan can become a source identifier. The court noted the TTAB’s long-standing recognition of the fact that “slogans cannot be registered as marks by the advertising agency, even if they would be subject to registration by the end users of the marks” because “the slogan does not identify and distinguish the services of the advertising agency, but rather is the creative work itself.” Slip op. at 7 (citing In re Admark, Inc., 214 U.S.P.Q. 302, 303 (T.T.A.B. 1982); In re Adver. & Mktg. Dev., Inc., 821 F.2d 614, 620 (Fed. Cir. 1987); In re Local Trademarks, Inc., 220 U.S.P.Q. 728, 730 (T.T.A.B. 1983)).

In this case, Goetz’s use of the “My Life, My Card” slogan was as a component of his business proposal to credit card companies, and not as a mark designating the origin of any goods or services that he was offering. Because Goetz offered the slogan as a complement to the card personalization concept and software he proposed to sell, the court found his claim to be “no better than that of an advertising agency that offers its clients a marketing concept to enhance their sales.” Slip op. at 8.

The court further cited to Goetz's own letters and proposals to card companies as evidence that he was not using the slogan as a trademark – the “My Life, My Card” slogan never appears as a stand-alone logo nor is the phrase ever followed by a reference to Goetz himself or his company. The court found that such evidence shows that Goetz did not intend for the “My Life, My Card” slogan to be associated with his services, but rather as a slogan to interest credit card companies into using his personalized cards concept and software.

The court also cited to Goetz's use of the Mez Design logo on his letters and proposals as an example of “typical trademark usage” (i.e., that logo was used much more so in a way as to designate Mez Design as the source of Goetz's proposal) which further illustrates that Goetz did not intend for the “My Life, My Card” slogan to be a trademark:

Goetz plainly desired readers to associate his goods or services with the Mez Design mark. My Life, My Card, by contrast, appeared in the section of Goetz’s correspondence in which he described the content of his proposal. In sum, Goetz employed the slogan My Life, My Card to generate interest among potential licensee credit card companies and not to differentiate or identify the origin of his goods or services. In such circumstances, the slogan served as “a mere dvertisement for itself as a hypothetical commodity.” Silberstein v. Fox Entm’t Group, Inc., 424 F. Supp. 2d 616, 633 (S.D.N.Y. 2004).

Slip op. at 9-10.

As such, the court found the district court’s dismissal of Goetz's trademark claim on the ground that he did not use the slogan as a trademark to be proper.

Analogous Use
The court initially noted that Goetz could not have made any actual use of the “My Life, My Card” slogan as a service mark because “Goetz's services were wholly hypothetical when he sent his promotional materials to the credit card companies.” Slip op. at 10-11. The court stated that “it cannot be said that a service mark is actually used if it is displayed in an advertisement for services that are non-existent or will only hypothetically be available at some point in the future. See, e.g., Greyhound Corp. v. Armour Life Ins. Co., 214 U.S.P.Q. 473, 474-75 (T.T.A.B. 1982).” Slip op. at 10.

Having laid this foundation, the court next addressed Goetz’s argument that even if he did not actually use the “My Life, My Card” slogan as a trademark, his activities were analogous to trademark use (the so-called “analogous use doctrine”). Goetz cites Diarama Trading Co. v. J. Walter Thompson U.S.A., Inc., No. 01 Civ. 2950, 2005 WL 2148925 (S.D.N.Y. Sept. 6, 2005) and Housing & Services, Inc. v. Minton, No. 97 Civ. 2725, 1997 WL 349949 (S.D.N.Y. June 24, 1997), in support of the assertion that analogous use is sufficient to establish trademark rights in the absence of actual use.

However, the court rejects Goetz’s argument finding that his use of the “My Life, My Card” slogan does not qualify as "analogous use" because analogous use must be use that is “open and notorious” (citing Minton at *4) – the use must be of such a nature and extent that the mark becomes popularized in the public mind so that the relevant segment of the public identifies the marked goods with the mark's adopter

In this case, Goetz used the slogan only in a few communications with credit card companies. There was no public exposure of the mark, and Goetz himself indicated in some e-mails that he wanted to keep the project and his website low profile. As such, Goetz’s use was neither open nor notorious and had not become associated in the public mind with Goetz.

Noting Goetz’s complete reliance on analogous use as his basis for any trademark rights and Goetz’s complete lack of any actual use of the slogan as a trademark, the court added that the analogous use doctrine “has not been stretched so far as to obviate the requirement that Goetz show eventual actual use.” See De Beers LV Trademark Ltd. v. DeBeers Diamond Syndicate Inc., 440 F. Supp. 2d 249, 265 n.14 (S.D.N.Y. 2006). In other words, for Goetz’s analogous use to be deemed trademark use, it must be within a commercially reasonable time prior to actual use for such use to be considered analogous use (citing WarnerVision Entm't Inc. v. Empire of Carolina Inc., 915 F. Supp. 639, 646 (S.D.N.Y. 1996), vacated on other grounds 101 F.3d 259 (2d Cir. 1996).

The American Trial Lawyers Association faces trademark infringement lawsuit from Association of Trial Lawyers of America

When one group of trial lawyers files a lawsuit against another group of trial lawyers, who wins? This sounds like a lawyer joke where the punchline is “Who cares.”

The Washington Post today ran a story about a trademark infringement lawsuit filed by the American Association for Justice, the group formerly known as the Association of Trial Lawyers of America. See Jeffrey H. Birnbaum, “A Case of Trial Lawyers v. Trial Lawyers,” The Washington Post, November 30, 2007, at D01 (link here).

For many years, the Association of Trial Lawyers of America (ATLA) was one of the largest and most politically powerful trial lawyer organizations in the U.S. representing the political interests of its roughly 56,000 members. After years of being the brunt of attacks from politicians and big corporations as an organization of greedy “trial lawyers,” the ATLA decided to change its name to the American Association for Justice (AAJ) (because while politicians and big business can attack an organization representing greedy trial lawyers, they cannot possibly attack an organization dedicated to justice).

Around the same time as the name change, however, a man named J. Keith Givens apparently formed a new competing “trial lawyer” organization named The American Trial Lawyers Association (“TheATLA”) and began soliciting AAJ members to join.

The lawsuit was filed by the AAJ against TheATLA and J. Keith Givens on November 15, 2007 in the U.S. District Court for the District of Minnesota. See American Association for Justice v. American Trial Lawyers Association et al, Case No. 0:2007cv04626 (D. Minn.). The lawsuit seeks injunctive relief to prevent TheATLA from using the name and confusingly similar acronym. The suit also seeks profits from using the name, treble damages, and attorney’s fees (in “typical trial lawyer fashion” as the WaPo article eloquently notes).

AAJ currently holds two registered trademarks for the mark ATLA, both of which issued in 1976: 1) a service mark directed to providing seminars and meetings for attorneys and 2) a collective membership mark indicating membership in the organization. It should be noted that AAJ continues to use the domain name http://www.atla.org/ as its home page.

It is interesting that the AAJ fought its own legal battle over its former name many years back. The AAJ adopted its former name only after the American College of Trial Lawyers (“ACTA”) successfully blocked the organization from calling itself the American Trial Lawyers Association – instead settling for the Association of Trial Lawyers of America.

TheATLA may have anticipated its own potential battle with the ACTA regarding its name. The WaPo article states that the ACTA filed its own lawsuit to prevent TheATLA from using the name American Trial Lawyers Association. However, federal court records seem to indicate that it was TheATLA that actually filed suit against the ACTA – possibly a declaratory judgment action that its name does not infringe upon ACTA’s name. On November 20, 2007, TheATLA filed a lawsuit in the U.S. District Court for the Middle District of Alabama against the ACTA. See The American Trial Lawyers Association, Inc. v. American College of Trial Lawyers, Case No. 1:2007cv01024 (M.D. Ala.). Perhaps Givens feels that this time around TheATLA will be more successful than the original ATLA was against the ACTA.

TheATLA’s battle over its name is also playing out at the USPTO. On March 20, 2007, TheATLA filed two Section 1(b) intent-to-use applications for two different versions of the above name and logo of its organization (here and here). Each application covers association services promoting the interests of lawyers and arranging and conducting educational conferences. The USPTO issued non-final office actions on June 28, 2007, refusing to register the marks under Section 2(d) because of a likelihood of confusion with AAJ’s aforementioned ATLA registrations.

Given the obvious likelihood of confusion between ATLA and TheATLA, the only chance of success on the part of TheATLA against AAJ’s registered marks (both in the USPTO and in the federal action) is to argue that that AAJ’s registered ATLA marks should be cancelled under 15 U.S.C. §1064 on the grounds that the marks were abandoned by AAJ when it changed its name.

Indeed, TheATLA may have grounds for arguing that the AAJ’s registrations should be cancelled. Under §45 (15 U.S.C. §1127), a mark is deemed to be “abandoned” if its use has been discontinued with intent not to resume such use. The intent not to resume may be inferred from the circumstances and nonuse for 3 consecutive years shall be prima facie evidence of abandonment. The “use” of a mark means the bona fide use of such mark made in the ordinary course of trade, and not made merely to reserve a right in a mark. AAJ made it clear that it will no longer call its organization by its old name – and thus have no need for the acronym ATLA. AAJ will counter by arguing that its website (atla.org) and some other remaining uses of the acronym constitute use of the mark.

However, even if TheATLA were successful in cancelling AAJ’s registrations, this does not necessarily translate into TheATLA continuing to use its name, because the organization must still contend with AAJ’s §43(a) grounds for relief. Although AAJ may no longer go by the name Association of Trial Lawyers of America or the acronym ATLA, there is still a long-standing association between the two names and the well-known trial lawyers group. As such, the use of a confusingly similar name and acronym by TheATLA is very much likely to cause confusion or cause mistake, or to deceive the public as to the affiliation, connection, or association of TheATLA with the organization formerly known as ATLA or confusion or mistake as to the origin, sponsorship, or approval of TheATLA by the organization formerly known as ATLA.

One thing is for certain – with trial lawyers on both sides, it is sure to be an interesting and contentious case.