Or “Cher,” or even “Carrot Top.” Either The Cobalt lawyers are not up on just how cool Lindsay Lohan is, or she needs to check back into rehab for delusional thoughts.

According to the Wall Street Journal Law Blog, Ms. Lohan has sued E-trade in New York Supreme Court for misappropriation of her name and characterization for one of its “baby” commercials in which a girl baby refers to another girl baby as “that milkaholic lindsay.” According to Lohan’s attorney, such a reference clearly is an attempt to trade off the good name of Lindsay Lohan.

A couple of things her attorney might want to think about: First, all roads do not lead to your client simply because her name is Lindsay. Second, publicly giving the defendants a defense by saying the commercial is a “parody” is probably not a good way to really drive home your own case. Finally, Lindsay may have a hard time establishing that she’s known only by her first name given the fact that she’s never advertised or marketed herself solely as Lindsay, there are over 300,000 women in the country with the name Lindsay. Besides, she was never and abuser of — oh wait, she’s got one strong piece of evidence.

We’re betting this case gets the New York Heave Ho.

Gary Benson might not remember Serpentine Fire, but he sure felt the heat when the Trademark Trial and Appeal Board sided with Maurice White and rejected Benson’s application to register “WE NEED A REBIRTH OF THE EARTH. EARTH, WIND, AND FIRE (and Design)”.

Benson applied to register the foregoing mark for arranging concerts with ecological themes. The examining attorney must have had her Reasons for passing the application to publication (perhaps she was living in a Fantasy), but in September, Maurice White, singer for the multi-platinum band, opposed the application on the grounds of likelihood of confusion with the band’s trademark for EARTH, WIND & FIRE. While the band was no longer actively producing records, they were still touring due to the incredible Devotion of its fans. The TTAB agreed to Rock That decision in favor of EWF. Sorry, Benson, That’s the Way of the World.

Practice Note: What is interesting about this case (besides the author’s age-revealing bad puns) is primarily procedural in nature. First, the Board notes that Applicant (representing himself) filed an answer that was “argumentative in nature, and does not actually respond to the notice of opposing by affirming or denying opposer’s allegations.” This is a violation of Rule 8(b) of the Federal Rules of Civil Procedure. The TTAB is generally more lenient to non-represented clients and often it does not make financial sense to file a motion asking the Board to strike the answer. That said, attorneys should review improperly filed answers to make certain information is not contained in the answer that is inappropriate (such as letters written in consideration of settlement). Even if the Board grants the applicant leave to refile its answer, the record is cleaner for the Opposer.

The decision also points out another important procedural misstep. Once an Opposition has proceeded to the trial stage, edits to the identification of goods by the Applicant will not generally be accepted unless agreed to by the Opposer (there are some exceptions). TBMP § 514.03. Such an amendment can therefore be used as a bargaining chip with Opposers in cases where the Applicant could refile and likely prevail, thus its significance should not be overlooked.

The Board also notes the applicant tried to introduce evidence in the case by attaching it to his brief. Notwithstanding the Board’s leniency toward pro per parties, it generally does not allow parties to blatantly disregard its rules. The consequence of improperly introduced evidence is to give it no consideration.

Finally, the Board here – and in many other cases – gives great weight to the fact that the Opposer’s mark is fully incorporated into Applicant’s mark. Clients should be advised that “adding” elements to an existing mark (especially one that is arbitrary or fanciful) is not likely to reduce confusion between a client’s mark and an existing mark.

Major League Baseball is calling foul on Don Mattingly and has let him know with their own sentiment: an opposition. MLB is not happy with Mattingly’s choice of logo, claiming in large part that the logo is confusingly similar to its well-recognized MLB logo.

This is not the first inning. In fact, MLB took its original swing against Mattingly’s company, Mattingly Hitting Products, Inc., in mid 2007, when it filed an opposition at the U.S. Patent and Trademark Office. Proceedings were suspended, however, until last month, when Mattingly filed his answer.

Mattingly, aka “Donnie Baseball,” who both began and ended his career with the New York Yankees and was purported to be as popular as Babe Ruth, had a career batting average of .307 and over 220 RBIs. Mattingly also holds the MLB Grand Slam record, His logo contains his retired number, 23, which Mattingly also used for his restaurant, Mattingly’s 23 (which closed down in the late 90s). Mattingly, also maintains an eBay store, called Don Mattingly’s 23.

Mattingly’s logo in question, features the trademark “23” in the shadow image of a player taking a swing. The MLB logo shows a shadow image of a player facing the same direction, and poised for a swing, begging the question of how many ways one can depict a hitter.

Surely, this matter is not over ‘til it’s over, but of note (and also called into question on the TTABlog), is Mattingly’s attorney’s first affirmative defense that “Opposer may have failed to mitigate losses and damages.” Must be American League rules, because that’s a new one for us.

The Sycamore Family Bakery (“SFB”) sold his rights in the trademark GRANDMA SYCAMORE and GRANDMA SYCAMORE’S HOME MAID BREAD to Sara Lee for a bucket o’ money. Apparently, granny wasn’t ready for retirement, however.

SFB thought it would be a good idea – and not a violation of its agreement with Sara Lee (predecessor in interest to the original party) – to market a new bread under the name SYCAMORE FAMILY BAKERY, with SYCAMORE as the dominant feature of the mark. For good measure, it added the tagline “The Original Granny Bread” and incorporated a “heart” logo (hearts are also incorporated into the GRANDMA SYCAMORE bread logo sold to Sara Lee).

Sara Lee sued for trademark infringement and for creating a false impression and the court agreed. In Sara Lee Corp. v. Sycamore Family Bakery, the court ruled that he dominant feature of the mark was highly distinctive, and found SFB had clearly taken pains to highlight the SYCAMORE component of the mark while subjugating the other terms. Second, by calling attention to its origin, SFB was deliberately trying to increase the likelihood consumers would get the very false impression the Sycamore Family products were related to and under the control of the trademark now owned by Sara Lee.

In granting the preliminary injunction, the court paid particular attention to the “intentional copying” element of the likelihood of confusion test, suggesting that SFB and “intimate knowledge” of the GRANDMA SYCAMORE family of trademarks made clear it was deliberately trying to trade off the goodwill of the marks. Moreover, the court cited employee “joking about cease and desist letters” from Sara Lee as clear disregard for Sara Lee’s rights.

Practice Pointer: Selling trademarks and then attempting to re-use them is never a good idea. Though obvious enough, clients often believe they have an inalienable right to use their own names, even after entering into a deal with another party to sell them. Attorneys will want to make sure clients understand the full magnitude of what they are selling before they sell it.

Moreover, clients often believe that once a buyer is no longer a going concern, any agreement made with that buyer dissolves. This is rarely the case, since most agreements contain a provision expressly allowing the obligations under the agreement to be transferred.

In re General Technologies, Inc., Serial Nos. 77052472 and 77052485 (July 23, 2009)

While never inherently distinctive, a color can function (and register) as a trademark if the applicant can show that the color has acquired secondary meaning and that it is not functional; meaning that the purchasing public identifies the color with the source of applicant’s products or services.

As this case illustrates, applicant’s burden to proof is notoriously difficult to meet, especially when it comes to use of color on a product. Two years ago, the company 3M attempted to register the color purple for sandpaper and failed as well (Saint-Gobain Corp. v. 3M Company, 90 USPQ2d 1425 (TTAB 2007)).

The landmark cases in this area are: In re Owens-Corning Fiberglas Corp., 774 F.2d 1116, 227 USPQ 417 (Fed. Cir. 1985) (color pink registrable for fiber glass insulation) and Qualitex Co. v. Jacobson Products Co., Inc, 514 U.S. 159 (1995 (green-gold color registrable for dry cleaning press pads). Color can also function as a service mark, which tends to be easier to prove; for example, Tiffany & So. owns a trademark registration for their color blue in conjunction with retail services; UPS owns the color brown for shipping services.

Acquired distinctiveness can be established by direct evidence (like testimonies or consumer surveys) or circumstantial evidence (like years of use or sales and advertising figures) and there is no fixed rule as to the amount of proof necessary. In this case, the TTAB found that the evidence proffered by applicant (use of the color for 10 years) was insufficient to support acquired distinctiveness of the maroon color in conjunction with applicant’s industrial products. Applicant provided no evidence that the public identified or recognized applicant’s maroon anchors. The TTAB found that there was “nothing in the record that show[ed] the the alleged mark [was] being promoted as a source indicator” and affirmed the refusal to register the color as a trademark.

Practice Note: If you are seeking registration of a non-traditional trademark (such as color, sound or trade dress), use it and feature it as a trademark. In the case of color, this might include identifying and highlighting the trademark significance of the color on the company’s web site and in advertising as applied to the goods. This case confirms that, especially in the case of a product color, consumer perception is key.

While the King of Pop has passed to his eternal resting place, he leaves behind more than devastated fans, mourning family members, legendary dance moves, and record breaking statistics. With his demise, we have learned that Michael Jackson amassed a substantial intellectual property portfolio, demonstrating a creativity well beyond his musical talents and leaving some to refer to him as an “Intellectual Property Goldmine.”

A little known fact about Jackson, he co-owned a patent for an invention he created that allows dancers to lean forward at a 45 degree angle beyond their center of gravity by wearing specially designed shoes. (U.S. Patent No. 5,255,425, titled “Method and Means For Creating Anti-Gravity”).

His famous gravity defying “lean” can be seen in the music video for the song Smooth Criminal.

Jackson also registering his name with the U.S. Patent and Trademark Office and owned numerous other trademarks for goods and services ranging from merchandise to fan clubs.

And, of course, let’s not forget about the copyrights. In addition to securing copyrights to his own works, Jackson famously outbid Paul McCartney and purchased rights to the Beatles song-copyright catalog for $47 million dollars in what many claim to be his best business decisions, later selling the rights to Sony for $90 million.

Although often maligned for his lifestyle choices and actions, Jackson’s dedication to creating and protecting his art and talents cannot be denied. Love him or hate him, he leveraged his superstardom (and that of others) into substantial intellectual property assets.

In a long and hard fought battle, the Second Circuit Court of Appeals has given renowned fashion designer, Joseph Abboud, a chance to reclaim his name.

Issuing a sweeping injunction in June 2008, a Southern District of New York court enjoined Abboud from using his name to sell, market or promote his own business, goods and/or services, finding Abboud’s intended use constituted a breach of contract and would constitute trademark infringement. The Second Circuit, in J.A. Apparel Corp. v. Abboud, et al No. 08-3181-cv (Second Cir.) found here reversed and remanded.

J.A. Apparel Corporation (“JA”), a former joint venture of Joseph Abboud, sued the designer in federal court alleging breach of contract, trademark infringement, and related claims over Abboud’s plans to use his name in the marketing and advertising of his then new JAZZ line, which he intended to promote using with such phrases as “a new composition by designer Joseph Abboud.”

Underlying the dispute, in 2000 JA entered into a sales agreement with Abboud, paying Abboud 65 million dollars for the exclusive rights to the ABBOUD label and related JOSEPH ABBOUD trademarks. While Abboud claimed the agreement only transferred rights in the ABBOUD trademarks but not the rights in his name, JA asserted the contract sold both the trademarks and the exclusive rights to use the Joseph Abboud name for commercial purposes. The district court ruled Abboud had unambiguously conveyed to J.A. all of Abboud’s rights to use his personal name, trademarks, and trade names for commercial purposes and also found Abboud’s planned use of his name would constitute trademark infringement, as it was likely to cause consumer confusion.

Vacating the injunction, the Second Circuit remanded the case, ruling the district court: 1) erred in ruling the sales agreement unambiguously conveyed all of Abboud’s rights to use his name commercially; and 2) erred in rejecting Abboud’s fair use claim as a defense to trademark infringement. The appellate court specifically found that given the conflicting interpretations of the sales agreement, the district court should have considered the parties’ extrinsic evidence to more fully understand the parties’ intent and that the district court should have examined Abboud’s actual or proposed use to resolve his fair use defense.

COMMENTARY: This case highlights the risks inherent in licensing or selling a brand name which also happens to be an individual’s name. Because the parties failed to clearly and precisely define the scope of their agreement, Joseph Abboud stands to lose the right to his very valuable name. Granted, he was paid 65 million dollars, which may seem like more than adequate compensation….but how much is your name worth, and what would it take for you to sell it? As some might say, “priceless.” Take the time to get it right.

St. Louis Cardinals manager Tony La Russa has sued Twitter, the popular micro-blogging service in San Francisco Superior Court alleging: Trademark Infringement, False Designation of Origin, Trademark Dilution, Cybersquatting, Misappropriation of Name, and Misappropriation of Likeness. In the Complaint, Mr. La Russa states the defendant owns the domain name twitter.com, and pursuant thereto, twitter.com/TonyLaRussa. Mr. La Russa contends an unknown user, pretending to be La Russa, began posting updates as Mr. La Russa. One line of the “profile” suggested it was all a fake: “Bio Parodies are fun for everyone.”

According to the San Francisco Chronicle, La Russa’s attorney tried to contact Twitter before filing the lawsuit, but got no response. Hours after the lawsuit was filed, Twitter removed the fake La Russa page and its postings. It is being reported that the case has already settled. “La Russa said Friday [6/5/09] that Twitter has agreed to pay legal fees and make a donation to his Animal Rescue Foundation. The organization is likely to take control of the name www.twitter.com/TonyLaRussa. However, the Wall Street Journal is reporting the opposite.

The truth is out there.

Trademark Note: Using a trademark and then simply claiming “parody” is not a “get outta jail free card.” In trademark cases, when a parody defense is raised, the defendant justifies his use on the grounds of humorous social comment. Funny or not, a defendant’s use may still be enjoined if it is likely to cause confusion with plaintiff’s trademark. Courts must balance the public interest in poking fun at trademarks and the institutions they represent, with the trademark owner’s investment and good will. Courts must also protect consumers from likely confusion.

As of last Saturday, Facebook users have been able to register personalized URLs of their choice for their Facebook home page (e.g., facebook.com/myusername). Approximately 5.75 million users signed up for their own URL over the weekend (also called “Vanity URLs”).

These new usernames could potentially be anything, including someone else’s trademark. To help trademark owners prevent hijacking of their marks, Facebook put in place a temporary procedure for trademark owners to “reserve” their registered trademarks with Facebook in advance and prevent the creation of URLs associated with those marks. Facebook has now closed this reservation period.

So what can trademark owners do who did not register their trademarks with Facebook and discover unauthorized URLs? They can request removal by contacting Facebook via this notice form. The procedure is fairly straightforward. You do not need to be registered on Facebook to use it.

So go to Facebook, check possible URLs containing your marks and, if you discover unauthorized uses, take action sooner rather than later.

A new website has launched whose purpose is to connect potential buyers and sellers of trademarks. Trademarks are words, signs or symbols used by businesses as a source identifier of goods and and services. Trademarks are valuable not only for the consumer goodwill they engender (see, MCDONALD’S, GOOGLE, BMW, HBO), but also as a barrier to market entry of similar products (or services) with confusingly similar trademarks.

According to its press release:

USTrademarkExchange.com was launched earlier this month as a dedicated trademark sales portal . . . Owners can list and promote their registered trademarks, while potential buyers including investors can easily search through a variety of available trademarks in one location.”

Sounds like a great idea, right? Hmmm, not so fast. There are a few basic, but important concepts worth noting. When a trademark is assigned (ownership transferred) from one party to another, the purchasor generally succeeds to all of the previous owner’s rights (e.g., dates of first use, etc.). However, a maxim of trademark law states a valid trademark assignment must include the goodwill of the business. What is goodwill?

A trademark stands for a certain standard of quality. The mark symbolized that level of quality that the public has come to associate with the products bearing the mark. That said, an assignee (or purchasor) of a trademark must be sure she has the implements necessary to maintain this quality. If she does not, the trademark becomes separated from its goodwill. When goodwill does not accompany the mark, the assignment may be called an assignment in gross or a naked assignment. Generally speaking, an assignment without goodwill is invalid.

It is too soon to tell how USTrademarkExchange.com intends to handle its trademark assignments and how potential buyers and sellers will see the benefits of their respective bargains. Like many things in life, “an ounce of prevention is worth a pound of cure.” When it comes to assigning or purchasing trademarks, conferring with competent trademark counsel is always a good bet.

Linden Labs, the host of the immensely popular site Second Life, an online virtual world, has been sued in an Arizona district court for trademark infringement and unfair competition. The complaint, filed by Taser International, makers of non-lethal (and sometimes lethal) weapons, claims Linden Labs allows third parties to sell TASER guns inside the virtual world.

Just so we’re clear, no one on Second Life is actively selling real TASER guns; rather Taser is suing Linden (who doesn’t sell anything), for letting people sell virtual (digitally created) guns that look like TASER weapons, and that use the TASER brand. The suit also alleges unfair competition, trade dress infringement, and false designation of origin, among other claims.

For those uninitiated few, users of the Second Life world can use their credit card to buy digital currency (“Linden Dollars”). They can then use that currency to make purchases in Second Life. For instance, if a user would like to dress up his/her avatar in a ball gown, s/he can use the Linden Dollars to shop at a virtual prom store. Similarly, if a user wants “protection” (you know, from digital thugs), s/he can buy a virtual weapon. Linden gets its revenue from a small percentage taken during the currency exchange.

It’s not the first time a company has sued Linden; neither is it the first time a company has sued a hosting site for trademark infringement by third parties (think: Google). It may, however, be the first time a company has sued another company for hosting a site where third parties selling products that aren’t even real. Is it time for a Digital Millennium Trademark Act?

Practice Note: Notwithstanding the fact that there is no DMTMA, companies may want to consider adopting a policy that allows them to stay an arms length away from disputes between users when it comes to trademarks. It’s not a fail-safe method of safe harbor protection, but it may make would-be plaintiffs feel they have an option short of filing a lawsuit, for getting hard-to-find users to stop using their marks.

Follow Tsan’s Legal Updates on or Subscribe to the Cobalt Blog

OpBiz, LLC hearts The TTAB, which ruled recently that OpBiz’ application to register HEART for “cocktail lounges, restaurant and bar services” was not confusingly similar to the registration KOKORO for “restaurant service.” In deciding the matter, the TTAB underscored a position it has taken in the past, namely, that the doctrine of foreign equivalents may not apply when the foreign word has more than one meaning. In this case, although the KOKORO registration identified the translation as “heart,” evidence submitted by the Applicant showed the term has multiple meanings. It was not sufficient for the examiner to rely solely on the translation identified in the application.

The case does not present particularly new law, but is a cavalcade of great procedural reminders. First, the Board finds a good deal of evidence otherwise submitted by the examining attorney was not timely filed, holding her to the same rigorous standard to which it holds the applicant (TBMP 1207.01 (2d ed. Rev. 2004)).

Next, in considering whether the evidence can come in under the judicial notice standard, the Board determines that the examiner has not met her burden. Her dictionary references do not rise to the level of online dictionaries for which the Board will take judicial notice (see, eg, In re Hotels.com L.P., 87 USPQ2d 1100, 1103 (TTAB 2008)). The Board also reminds the examining attorney that her Wikipedia submissions are “not proper subject matter for judicial notice because of its inherent lack of trustworthiness” and are not admissible because the applicant had no opportunity to rebut the evidence. ( see, In re IP Carrier Consulting Group, 84 USPQ2d 1028, 1032 (TTAB 2007)).

With the examining attorney’s record fairly gutted, the Board reviewed the issue under both a likelihood of confusion standard (for which confusion is arguably found) and a doctrine of foreign equivalent standard. Because the mark KOKORO has multiple meanings, and the examiner did not submit evidence that Japanese is routinely spoken in U.S. households, the Board ultimately found for Applicant and reversed the decision of the examiner.

Practice Note: In addition to the foregoing, the final lesson here is “Thank Your Paralegal.” As with many TTAB decisions, the case itself does not particularly espouse new law, but the decision nevertheless is worth reading because the Board reminds us how important procedure, protocol, and immaculate record keeping can be to the final decision. The examiner in this case raises the objection that the evidence submitted by applicant in the appeal should not have been considered because it was not filed prior to the appeal. In fact, there was a computer glitch and the evidence was filed, but did not get uploaded to the TDR. A thorough review of the paralegal’s record-keeping convinced the Board of this fact and the evidence submitted was sufficient for the Board to render a decision in favor of the applicant. The Board also found that the Examiner had been negligent in not notifying the Applicant that she had never received the exhibits, notwithstanding the fact that they were referenced in the Office Action Responses.

Follow Tsan’s Legal Updates on or Subscribe to the Cobalt Blog

On March 16, 2009, Parfums Nina Ricci filed suit against National Entertainment Collectibles Association, Hot Top, and others, for design patent infringement, trade dress infringement, and other common law unfair business practices, stemming from Nina Ricci’s rights in an apple-shaped bottle containing the fragrance “Nina” (the “Nina Bottle”), for which it has a U.S. design patent.

Ricci took the first bite, alleging defendants began marketing their Twilight perfume using an exact replica of the Nina Bottle without Ricci’s permission, thus infringing Ricci’s patent rights and trade dress rights in the bottle. Judging from the pictures above, one of these actors appears to be a rotten apple.

The Nina Bottle, on the right, was the first market entrant and, and Nina Ricci protected its unique apple design with a design patent. It also claims common law trade dress rights in the appearance. A brief online search revealed upwards of 6 other perfume bottles with the apple design, but none (other than the defendant’s) particularly similar to the Nina Bottle.

This suit presents an interesting question regarding the issue of whether one can protect identical intellectual property elements under both patent and trademark. Perry Saidman of Saidman Design Law Group, which specializes in design patents, notes that the prevailing view is that an owner can get design patents for market-entry protection, and later, when secondary meaning attaches, secure trade dress protection for roughly the same configuration. Saidman also commented that the issue of whether an owner can get both patent and trademark protection for a design is ripe for the Supremes, who have thus far side-stepped the issue in other patent cases.

On March 19, 2009, The Hershey Company, et al. filed suit in the Northern District of West Virginia against Reese’s Nursery and Landscaping, alleging federal trademark infringement, false designation of origin, federal trademark dilution, and unfair competition. At issue is the Defendant’s alleged use of the REESE’s trade dress, i.e., “the REESE’S brand name in distinct yellow script letters outlined in brown.”

In its Complaint, Hershey alleges it has used its distinctive trade dress in commerce for “nearly 100 years in connection with REESE’S brand candy.” At the rich, creamy center of this controversy is Hershey’s allegation that Defendant has adopted a business logo that is nearly identical to the Reese’s trade dress.

What really sticks to the roof of Hershey’s mouth is its belief that Defendant adopted its logo in “a deliberate attempt to trade on the valuable trademark rights and substantial goodwill established by Hershey.” Moreover, Hershey contends Defendant has “traded on and profited from the enormous goodwill an d reputation established by Hershey.” Where “the rubber hits the road” in this Complaint, or more aptly, where “the peanut butter meets chocolate,” is the following allegation: Defendant has “continued to use REESE’S trade dress despite previously representing to The Hershey Company that [it] would cease use of the REESE’S trade dress.”

The Defendant has not yet filed a responsive pleading, but a quick review of its website, reveals a new black and white logo.

Practice Note: Although early in the litigation process, there is much to learn from Hershey’s Complaint. First, it appears as though Hershey previously reached out to the Nursery, seeking a modification of its logo. When Defendant’s (likely multiple) assurances that it would modify its logo went unfulfilled, Hershey filed its suit. The lawsuit appears to have gotten the attention of Defendant, as it has now removed color elements from its logo. Time will tell whether this change will satisfy Hershey’s.

Hershey’s Complaint does a nice job of laying out facts necessary to establish that its trade dress is “famous” under the Lanham Act. Finally, the case may negatively impact Hershey’s public image. For example, what was once a legal filing in West Virginia, is now a blogosphere entry, and may be written about by others in less than glowing terms. Some may view this lawsuit as a “big guy v. little guy” case and not feel as fondly for Hershey as they once may have. Moreover, one has to ask how much damage Hershey has really suffered here? To this eye, the Nursery logo reminds me of the Reese’s logo, but I’m not confused as whether the nursery is a business venture of the chocolatier. In fact, it makes me want to walk to my reception desk and pluck a REESE’s peanut butter cup out of our candy dish!

Have you ever had one of those really good soft oatmeal cookies that comes in the pretty red package that looks like this:

Well, the company, Archway Bakeries, LLC, invested a lot of time and money in creating and marketing its trade dress (i.e. the look and feel of it packaging) and was piping hot when it discovered that a competitor, Voortman Cookies Limited, began packaging its cookies like this shortly after Archway filed for bankruptcy:

Prior to Archway’s bankruptcy filing, Voortman’s packaging creating a completely distinct commercial impression and looked like this:

Pulling the plug on Voortman’s activities, Archway and Lance Manufacturing, the company that purchased Archway’s assets (including all intellectual property rights) during the bankruptcy proceeding (collectively “Archway”), filed suit against Voortman for trademark infringement and related claims in Lance Mfg., LLC v. Voortman Cookies (WD NC 3/24/09).

In a bittersweet ruling against Voortman, the North Carolina district court issued a preliminary injunction prohibiting Voortman from advertising, distributing, selling, or offering to sell its cookies in the Voortman packaging. Carefully measuring the arguments, the court found that Archway’s trade unregistered trade dress was: 1) non-functional – i.e. not essential to the use or purpose of the product; and 2) created an overall distinctive impression.

Voortman attempted to stir things up by arguing that the case was moot because it had already ceased using the packaging and had begun production of a modified packaging following a cease and desist letter it received from Lance; however, the court wouldn’t bite. It noted that the allegedly infringing packaging still remained on the shelves and and that Voortman could, at any time, re-release the packaging.

The court also found that Archway was likely to succeed in proving the Voortman packaging was likely to cause confusion with Archway’s packaging. The packages were virtually identical in many respects. Moreover, Archway presented evidence that the Voortman packaging was an intentional copy and nearly identical to its trade dress. In light of the overall evidence, the court found that Archway had made an adequate showing of a likelihood of confusion.

In its narrowly tailored injunction, the court did offer Voortman a nice-sized crumb by refusing to require Voortman to remove, destroy and/or recall the existing packaging from the marketplace. Citing the financial hardship to Voortman and relatively short shelf life of the existing cookies inventory, the court ruled that Voortman could sell-off its remaining inventory in the existing packaging. Voortman fans better get them while they’re hot!

This article from the Daily Princetonian reports that the University “grossed roughly $266,000 [in] 2008… for the commercial use of Princeton trademarks and logos.” The University reportedly has over 100 licensing agreements with third parties, which grant limited rights to produce, use and/or sell products under the University’s marks (anything from baseball caps to mugs), in exchange for quality control and a royalty. As it should, the University owns and maintains a number of trademark registrations at the U.S. Patent and Trademark Office.

Practice Note: As Lezlie pointed out in her excellent post last week, a company’s IP is often it’s most valuable asset, especially in these tough economic times. This story is an example of a trademark owner (Princeton in this case) “doing it right.”

Trademarks can be a valuable income-generating asset, if properly maintained and managed. With reasonable policies and proper oversight procedures in place, licensing and co-branding deals represent great opportunities for generating regular revenue, as well as strengthening your client’s brand.

As a starting point, clients may want to keep in mind these basic guidelines to maximize these licensing opportunities:
- Register your marks domestically, as well as in the countries where you intend to do business. Being pro-active about trademark protection saves money and headaches in the long run. Also think about keeping your trademark counsel in the loop of new marketing and branding strategies, to make sure you’re covered;
- Maintain your marks and use them properly and consistently; be practical but don’t be lazy or you may lose rights (and licensing opportunities) over time. Your trademark counsel is there to assist you in this process, for example by talking with your marketing staff about proper trademark use and ways to create strong brands;
- Police your marks consistently, which may include having an enforcement plan in place and following it. If you don’t enforce your trademarks, you may lose rights. A pro-active policy is also a good way to establish your rights without having to send a demand letter every time.
- Explore licensing and royalty-generating opportunities and have those agreements vetted by your intellectual property counsel. Contracts that don’t include certain “magic (legal) words” (for example, quality control provisions) may weaken your rights significantly.

It’s tempting to do, but according to the Federal Circuit, use just ain’t use in commerce until it’s a bona fide offer for sale to the actual intended purchasing public. Theoretical ability to provide the service, brochures that never got sent, and business plans showing intent are not sufficient to establish use.

Aycock Engineering, Inc., founded under a previous name in the 1940’s, was created for the purpose of offering a chartered air transportation service under the mark AIRFLITE. The business plan suggested that the company would need at least 300 air taxi operators in the U.S. to make a go of the enterprise.

In March of 1970, through brochures and letters advertising the AIRFLITE service, Aycock invited all FAA certified air taxi operators to join his AIRFLITE service. In August of 1970, Aycock filed a service mark application to register AIRFLITE, and attached as specimens of use the brochures he used to entice pilots to join his network. Ultimately, in 1974 after a lengthy prosecution fight with the examiner, Aycock’s mark was registered on the Supplemental Register for “[a]rranging for individual reservations for flights on airplanes.”

Aycock continued to market his service to the pilots who would charter his planes, but never actually marketed the service to the general public, notwithstanding his establishment of a customer toll-free number listed on the brochure and a collection of 12 pilots (far short of the 300 the business plan said were necessary to run the service). The evidence did not show that Aycock ever arranged a flight for a passenger.

In 2001, Airflite, Inc. (“Petitioner/Appellee”) filed a petition to cancel Aycock’s registration on the ground of nonuse. The TTAB found that Aycock has failed to offer the services listed in the application and on appeal, the Federal Circuit affirmed.

Although the court addressed numerous factors that led it to affirm the TTAB ruling, its primary focus was on the offer of the service listed in the application. It noted the service was simply not offered to those who would ultimately buy it – the purchasing public. It was not enough to establish a toll-free number and collect pilots to ferry people as intended. Neither was it sufficient to use the mark on the brochure that could eventually go to consumers. The fact that Aycock had never marketed the actual service to the intended consumer was sufficient to establish nonuse of the mark for those services, and subsequently, to cancel his registration.

Practice Note: Many practitioners tell their clients that printing business cards and creating stationery is sufficient to show use in commerce. Still others advise that the creation of brochures that contain a price list are sufficient to establish use. This case suggests (and this firm has always maintained) that there is a distinction between use anywhere and actual bona fide use in commerce. Use in commerce, to be above reproach, must be a bona fide offer for sale of the product for which you are claiming use to the target consumer.

If we didn’t learn the Trademark Trial and Appeal Board was prickly when it comes to procedure from the Blue Man case, we just got another lesson. The Board is handing out some more tough love on counsel. In the precedential decision, Syngenta Crop Protection, Inc. v. Bio-Chek, LLC (Opposition No. 91175091, March 12, 2009), the Board tossed out Opposer’s 2(d) claim on the ground that it had improperly submitted its registration. Without considering its registration for AGROMETER, Opposer was unable to produce sufficient evidence at common law to show priority over applicant’s AGMETER mark, and thus was unable to sustain the 2(d) opposition.

Opposer submitted a photocopy of its licensor’s original registration certificate, dated 2004. A photocopy of a registration certificate may not be adequate proof of the current status of a registered mark. Under Trademark Rule 2.122(d)(2), a trademark registration document submitted should be “issued by the Patent and Trademark Office and show both the current status of and current title to the registration.” The 2004 copy did not confirm the status of the mark in 2007 or 2008.

In addition, Opposer, did not properly introduce the registration, as specified in the Trademark Rules. It did not attach the copy to the opposition; neither did it did not introduce it during testimony; and because applicant never admitted or stipulated to the current ownership and validity of the registration, the registration was not authenticated by waiver.

Because the Board did not consider the registration as prima facie evidence of ownership and first use, the Opposer was forced to rely solely on proof of its prior common law rights, which, the Board established, it had not done sufficient to establish priority.

To make matters worse, the Opposer improperly submitted notices of reliance for some of its documents, such as press releases, internet articles, and sales and marketing materials it wanted to produce. The Board noted that notices of reliance are strictly limited and may be used to introduce only discovery deposition, interrogatory responses, admission or written disclosures of an adverse party, and printed publications or official records. Other evidence must be authenticated by testimony. Accordingly, much of Opposer’s evidence common law evidence was not considered.

As a result of the limited evidence Opposer was allowed to submit, the Board found that it has not established priority and dismissed the case.

Practice Note: This case presents a veritable cavalcade of interesting issues and can serve as a laundry list for what not to do. That said, it’s important to note that even good and careful attorneys can get tripped up on the rules regarding submission of documents and evidence in a TTAB proceeding. There but for the grace of a good associate go any of us.

Non-trademark attorneys, more accustomed to fighting in federal court assume (and tell their clients), that the process at the TTAB mirrors that of federal court proceedings. While the basis of that statement is true, there are myriad distinctions that must be taken into account, as this case illustrates. Counsel should learn those distinctions and advise clients that availing itself of TTAB proceedings is no “walk in the park,” and federal court methods cannot simply be cloned. The good news is, failures by parties work both ways. If your opponent has been sloppy in its submission of evidence, the TTAB has shown that it will not consider it. Careful reading of pleadings, discovery, and motions can be a gold mine for a summary judgment motion.

Procedurally, the Opposer in this case can do what Blue Man Group did in its own matter and appeal the decision in district court. In all likelihood, like Blue Man, it will be able to properly introduce its evidence and – at the very least – establish priority in its mark. Then the question will hinge on confusion.

Finally, this case underscores the importance of a valid federal registration for clients’ important marks. When push comes to shove, a registration, properly introduced, saves time and money, because it is prima facie evidence of a first use date. Moreover, after 5 years of continuous use of the mark after a registration is issued, the mark’s registration becomes incontestable, except under limited circumstances (fraud, abandonment, genericness).

The new logo (shown above next to the old one) is representative of the phone company’s radically new “so very Verizon” campaign.

Further images of the clever campaign are available here.

No word yet on whether the old CAN YOU HEAR ME NOW? tagline will be replaced by the VERY awesome: IS IT HOT IN HERE?

Practice Notes: Rebranding efforts can be effective for companies to update their image and gain new consumers (although they can sometimes backfire, as Tropicana learned recently). Clients should involve their trademark counsel in the rebranding and marketing efforts, so as to assess potential risks (such as likelihood of confusion with existing marks, say, in this case, the SKYPE logo) and protect the new marks, including new trade dress, if applicable.

Tsan’s Comment: Naturally, rebranding efforts that take place on April Fool’s Day and are gone the next day should be suspect (unless you’re introducing New Coke).

Inhale, Inc., makers of hookahs and the INHALE vaporizer believes Oglesby & Butler was smoking something other than tobacco when it adopted the name I-INHALE for its vaporizer product, and Inhale put down its own hookah long enough to file suit in the Central District of California for trademark infringement of its name. Inhale has several federal trademark registrations for INHALE for smoking devices “used by individuals to smoke herbs such as tobacco” (not that anyone remembers).

It took less than 10 days for Oglesby & Butler to come out of its fog and change its name to iolite. After all, looks like Inhale had Oglesby head to rights.