© 2013 Kilpatrick Townsend Presented to Selected Topics in Trademark Law William Bryner Kilpatrick Townsend & Stockton LLP

2 Presentation Topics –Benefits of federal registration (over common law rights) –Recent developments in U.S. Trademark Office practice –International considerations –Keyword advertising: Fourth Circuit decision in Rosetta Stone v. Google Introduction

© 2013 Kilpatrick Townsend Benefits of Federal Trademark Registration

4 Standard line –Federal registration provides for significant evidentiary benefits if you ever have to sue to enforce your rights –Presumptions of ownership and validity (15 U.S.C. § 1057(b)) Why Register?

5 Marks are not required to be registered in the U.S. Unregistered use can give rise to legally protectable rights at common law Why Register?

6 If not federally registered, the geographic scope of actual use becomes a consideration. –As of the relevant date, where is the mark in use? –One party may have valid common law rights in Seattle, while another may have valid rights in Miami. Why Register? Seattle Miami

7 Registration on the Principal Register confers certain benefits: –Helps significantly to resolve the geography issue –Provides “constructive” use nationwide, giving the registrant nationwide priority as of a date certain (15 U.S.C. § 1057(c)) Why Register?

8 Example: Synergistic Int'l, LLC v. Korman, 402 F. Supp. 2d 651 (E.D. Va. 2005), aff'd in part and vacated in part, 470 F.3d 162 (4th Cir. 2006) –GLASS DOCTOR® registered by Plaintiff’s predecessor in 1977 –Used in various parts of the country, but not Virginia Beach –In 1987, Defendant begins offering similar services in Virginia Beach under WINDSHIELD DOCTOR trademark –In 2003, Plaintiff expanded GLASS DOCTOR® franchise to Virginia Beach Why Register?

9 Outcome: –Summary judgment for Plaintiff (affirmed on appeal) –Permanent injunction against Defendant’s use of WINDSHIELD DOCTOR trademark –Cancellation of Defendant’s federal registration for WINDSHIELD DOCTOR trademark (which was less than five years old) Why Register?

© 2013 Kilpatrick Townsend Recent Developments in U.S. Trademark Office Practices

11 Highlights –Are “fraud” claims dead? –How high is the “bona fide intent to use” hurdle? –How is the Office attempting to address potentially overbroad descriptions of goods/services in registrations up for maintenance or renewal? Trademark Office Practices

12 At the TTAB, “fraud” is effectively dead. –No successful fraud claims since the Federal Circuit’s Bose decision in 2009 –In M.C.I. Foods, Inc. v. Brady Bunte, 96 USPQ2d 1544 (TTAB 2010), the Board refused to find fraud based on the applicant’s reliance on advice of counsel –In Information Builders, Inc. v. Bristol Technologies, Inc. (Opp. No , Jan. 10, 2011) (not precedential), the Board refused to find fraud based on the applicant’s submission of a completely concocted specimen of use because the applicant’s president, as a layperson, had an “honest misunderstanding” about the requirements Fraud

13 However, “fraud” is still alive in federal courts and may be approached differently than at the TTAB. –Fair Isaac Corp. v. Experian Info. Solutions, Inc., 650 F.3d 1139 (8 th Cir. 2011) Fraud

14 Bona fide intent to “use in commerce” –“Use in commerce” cannot be “merely to reserve a right in a mark” (15 U.S.C. § 1127) –1989 legislative history: The intention must be “firm” and a “mere hope” of use is not enough Bona Fide Intent to Use

15 The inquiry into an applicant’s bona fide intent to use the mark is an objective one, rather than a subjective one –Spirits Int’l B.V., 99 USPQ2d 1545 (TTAB 2011) –L’Oreal S.A. v. Marcon, 102 USPQ2d 1434 (TTAB 2012) Bona Fide Intent to Use

16 Upshot: Applicant needs contemporaneous documentary evidence supporting its claimed bona fide intent If not, Opposer satisfies its prima facie case simply by showing lack of such documents Applicant then has to explain itself Bona Fide Intent to Use

17 Remedy: Is the whole Class at risk of invalidation? –The Wet Seal, Inc. v. FD Management, Inc., 82 USPQ2d 1629 (TTAB 2007): The Board only assesses the issue “in terms of whether the items, if any, for which Oppose has shown Applicant’s lack of a bona fide intention to use the mark should be deleted from the application.” –Could be mere dicta because the “lack of bona fide intent” claim was ultimately dismissed Bona Fide Intent to Use

18 Remedy: Is the whole Class at risk of invalidation? –Spirits Int’l footnote: “Although the notice of opposition refers specifically to... Applicant’s lack of a bona fide intention to use its mark for alcoholic beverages, the opposition was brought against all the goods in Classes 32 and 33. Therefore, to the extent that Opposer is successful in proving... lack of a bona fide intention to use the mark with respect to any of the goods in each class, and specifically alcoholic beverages, the opposition against the classes in their entirety would be sustained.” –Not dicta because claim challenging bona fide intent to use was sustained Bona Fide Intent to Use

19 General rule: Specimens need only to be submitted on a “one per Class basis” USPTO Pilot Program (77 Fed. Reg (May 22, 2012)): –Two-year program commencing June 22, 2012 –Can randomly select Section 8 affidavits for which to request a specimen evidencing use on other identified goods/services Reigning in Overbroad Claims of Use

20 Acceptable specimens of use for the U.S. Trademark Office –For goods: Tags or labels on the goods Tags or labels on packaging for the goods “Displays associated with the goods” (point-of-sale; catalogs) But not advertising or promotional materials –For services: Advertising or promotional materials Reigning in Overbroad Claims of Use

21 Query: What happens if one cannot provide acceptable additional specimens? –Deletion of the goods/services for which the request was made but not satisfied –Potential additional requests for specimens as to other goods/services Reigning in Overbroad Claims of Use

© 2013 Kilpatrick Townsend International Considerations

23 As a general rule, trademark rights are “territorial” in nature. –Acquiring rights in one country does not automatically mean that you possess them in other countries International Considerations

24 Legal requirements and procedures vary from country to country. –Most (but not all) countries are “first to register” –Some countries allow very broad descriptions of goods/services –Some countries provide only a narrow scope of protection International Considerations

25 International treaties and conventions are often helpful with regard to priority and cost. –Paris Convention Inbound to U.S. under 15 U.S.C. § 1126 Outbound from U.S. under local law –Madrid Protocol Inbound to U.S. under 15 U.S.C. § 1141f Outbound from U.S. under 15 U.S.C. § 1114a International Considerations

26 Implications for U.S. clearance/prosecution efforts –A month before you conducted your U.S. clearance search, someone might have filed in a Paris Convention country and might secure effective priority over your application even though you technically filed first International Considerations

27 For “outbound” prosecution, you must balance: –Need for earlier priority date –Breadth of protection a registration might provide International Considerations

28 Good local advice is often critical International Considerations

© 2013 Kilpatrick Townsend Keyword Advertising

30 Rosetta Stone Ltd. v. Google, Inc., 676 F.3d 144 (4th Cir. 2012) Keyword Advertising

31 Keyword Advertising

32 Outcome: District court’s grant of summary judgment largely vacated –Genuine issues of material fact as to direct and contributory infringement claims –“Use in commerce” by Google not disputed on appeal –“Defensive” functionality is a “dead letter” –Genuine issues of material fact as to dilution claims Keyword Advertising

33 Takeaway –Keyword advertising can still be a risky proposition, depending on how one goes about it –Analysis is very fact-driven Keyword Advertising

© 2013 Kilpatrick Townsend Happy to Entertain Your Questions. Thank You!