Trademark Priority Intro to IP – Prof Merges

Agenda Priority – Federally Registered Marks – Common Law trademarks

Clam Corp. v. Innovative Outdoor Solutions, Inc., 89 PQ2d 1314 (D. Minn. Dec. 2008) Registered trademark for ice fishing huts made in particular shade of blue Held: No infringement; defendant’s huts were different shade of blue, had black roofs, and had defendant’s logo prominently displayed

Hinsdale Naperville Wheaton Oak Brook

Zazu Designs, Inc. v. L’Oreal /86 4/86 6/12/ /86 Covenant with Riviera; 1 st Interstate shipment Meets with Chemists; sales in salon L’Oreal ZHD ZHD Files Suit 11/85; 2/86: Shipments to Texas & Florida Federal Registration

How do you establish priority? Common law origins: Must “win the race to the marketplace” – IPNTA 5 th at p. 779 BUT: There are some detailed rules to this race...

Lanham Act sec. 1, 15 USC 1051 “(a)(1) The owner of a trademark used in commerce may request registration of its trademark on the principal register hereby established....”

Caselaw: Balancing two factors “Prevent[] entrepreneurs from reserving brand names in order to [raise rivals’ costs]” – prevent “Rent Seeking” – IPNTA 5 th p.779 “Allow[] firms to seek protection for a mark before investing substantial sums in promotion” – “Claim-staking” – IPNTA 5 th p. 779

Sound familiar? Utility in patent law: prevent “wrong kind” of racing, but permit reasonable claiming Derivative works in copyright: allow owner to develop ancillary markets without fear of competition

Use requirement Policy justifications – Furthers purpose of trademark (I.D. source) – Prevents warehousing of trademarks – Provides notice to others Possible drawbacks – May cause uncertainty re: when rights attach – May result in loss of preparatory expenses

A twist: “Intent to use” Allows “reservation” of right to a trademark But ONLY if reserved mark is actually used within 6 months (extendable to 1 yr. and then three years for good cause)

Intent to use statute: Lanham Act Sec. 1(b), 15 USC 1051(b) (b)(1) A person who has a bona fide intention, under circumstances showing the good faith of such person, to use a trademark in commerce may request registration of its trademark on the principal register hereby established by paying the prescribed fee and filing in the Patent and Trademark Office an application and a verified statement, in such form as may be prescribed by the Director.

Lan Act Sec 13, 15 USC 1063 (b)(2) a notice of allowance shall be issued to the applicant if the applicant applied for registration under section 1051(b) of this title....

“Use in Commerce” Lanham Act § 1 (15 U.S.C. § 1051) – (a)(1) The owner of a trademark used in commerce may request registration … Lanham Act § 45 (15 U.S.C. § 1125) – Commerce: All commerce which may lawfully be regulated by Congress – Bona fide use of a mark in the ordinary course of trade, and not merely made to reserve a right in a mark.

Maryland Stadium v. Becker: IPNTA 5 th Starts selling T-Shirts New ballpark approved BeckerMSA Old buildings demolished New stadium begins to rise Named Camden Yards First game played Extensive advertising, promotion, and use

What constitutes “use”? Use in a bona fide way, targeted at customers Key is “use” not “sale” – Sales probative of use, esp. if followed by more – But neither necessary nor sufficient Single sale may not be sufficient (Blue Bell, Lucent) Token sales not sufficient (Blue Bell, P&G) Preparatory activity may be sufficient (Shalom, Becker) – Look to totality of circumstances

Registration - Priority Lanham Act §7(c) (15 U.S.C. 1057(c)): – Contingent on the registration of a mark …, the filing of the application … shall constitute constructive use of the mark, conferring a right of priority, nationwide in effect, in connection with the goods … specified … against any other person except for a person whose mark has not been abandoned and who, prior to such filing - (1) has used the mark …

State registration; common law use Zazu’s state registration here: for services, not goods – “Trade name” vs. state TM register What if Zazu had had a state registration for goods?

Common Law Rights and Concurrent Use Two types of concurrent use – Different Products E.g. Apple Records and Apple Computers E.g. Acme Cleaners, Acme Mufflers, Acme... – Different Geographic Markets E.g. Broadway Pizza (Boston) and Broadway Pizza (S.F.)

Common law rights Geographic priority determined by (1) 1 st use, (2) customer associations

Weiner King, Inc. v. Wiener King Corp., 615 F.2d 512 (C.C.P.A. 1980)

Limited area defense allows the non- registering party to claim priority in those geographic areas where he has made continuous use of the mark since before the registering party filed her application. The non-registering party is ‘‘frozen’’ in the use of his mark, however, and cannot expand it outside his existing territory or a natural ‘‘zone of expansion.’’ See Weiner King, Inc. v. Wiener King Corp., 615 F.2d 512 (C.C.P.A. 1980).

Dawn Donut v. Hart’s, 267 F2d 358 (2d Cir 1959)