1. 1 1 AIPLA Firm Logo American Intellectual Property Law Association TTAB REVIEW CASES FROM 2014 George W. Lewis, Esq. Westerman, Hattori, Daniels & Adrian IP PRACTICE IN JAPAN COMMITTEE PRECONFERENCE AIPLA MIDWINTER INSTITUTE ORLANDO, FLORIDA JANUARY 28. 2015

2. 2 2 AIPLA Firm Logo FRAUD

3. 3 3 AIPLA Firm Logo Nationstar Mortgage LLC v. Ahmad, 112 USPQ2d 1361 (TTAB 2014) [precedential] The Board upheld an opposition to registration of the mark NATIONSTAR for, Mortgage banking services, namely, origination, acquisition, servicing, securitization and brokerage of mortgage loans. Because the Applicant had not used the mark for the identified services, the Board found that Applicant’s incorrect statement alleging the use of the mark was fraudulent.

4. 4 4 AIPLA Firm Logo FACTS OF THE CASE The Applicant was a licensed real estate agent, but he was not a licensed real estate broker, insurance broker, or mortgage insurance broker. In his capacity as a licensed real estate agent, he assisted his customers in choosing the appropriate mortgage and insurance agents/brokers and in preparing the applications.

5. 5 5 AIPLA Firm Logo STANDARDS FOR FINDING FRAUD Fraud in procuring a trademark registration occurs when –(1) an applicant knowingly makes false; –(2) material representations of fact in connection with its application; and –(3) with intent to deceive.

6. 6 6 AIPLA Firm Logo INTENT REQUIREMENT FOR FRAUD Subjective intent to deceive is an indispensable element in the analysis even though it can be very difficult to prove. A false statement of material fact is not fraud if it was made with a reasonable and honest belief that it was true.

7. 7 7 AIPLA Firm Logo CONCLUSIONS OF THE BOARD ON THE ELEMENTS FOR FRAUD KNOWINGLY FALSE - The mark was not in use for the identified services false and the Applicant knew that it was false. MATERIALITY - A false allegation of use in a Section 1(a) application is always material since in the absence of use, the application would not issue to registration under Section 1(a). INTENT - As to the intent to deceive the Board found the Applicant’s testimony to be generally unbelievable; that the applicant made very specific false statements about his own industry and his own activities, knowing that he did not have the appropriate licenses; that the applicant fabricated specimens.

8. 8 8 AIPLA Firm Logo Section 14(3) – GROUNDS FOR CANCELLATION OR OPPOSITION

9. 9 9 AIPLA Firm Logo The Board granted Bayer’s petition to cancel Registrant Belmora’s registration for the mark FLANAX for “orally ingestible tablets of Naproxen Sodium for use as an analgesic,” on the ground that the mark was being used by Registrant Belmora to misrepresent the source of its goods in violation of Section 14(3) of the Trademark Act. Bayer Consumer Care AG v. Belmora LLC, 110 USPQ2d 1623 (TTAB 2014) [precedential]

10. 10 AIPLA Firm Logo FACTS OF THE CASE – FINDINGS BY THE BOARD Petitioner Bayer’s FLANAX brand analgesic has been sold in Mexico since 1976 and ranks as the top-selling pain reliever in Mexico. Belmora used the FLANAX mark in the United States for the same goods in order to misrepresent to U.S. consumers the source of respondent’s products as Bayer’s Mexican products. There were many U.S. customers of Mexican origin who were familiar with Bayer’s FLANAX product sold in Mexico and would assume that the U.S. product sold under the FLANAX mark was the same product and came from the same source.

11. 11 AIPLA Firm Logo BAYER’S DIFFICULTIES UNDER SECTION 2(d) The claims of likelihood of confusion under Section 2(d) were dismissed because Bayer: –(1) does not own a registration for the mark FLANAX in the United States; –(2) had not used the mark in the U.S.; and –(3) did not plan to use the mark here. In the absence of use, there are no protectable trademark rights. In order to proceed under Section 2(d), a party must have prior trademark rights.

12. 12 AIPLA Firm Logo BAYER’S DIFFICULTIES UNDER PARIS CONVENTION PROVISION FOR FAMOUS MARKS Bayer's claim of violation of Section 6b of the Paris Convention was also dismissed because the Paris Convention is not self-executing and does not afford an independent cause of action for parties in Board proceedings.

13. 13 AIPLA Firm Logo Section 14(3) of the Trademark Act Under Section 14(3) of the Trademark Act, a registration of a mark may be cancelled if the mark "is being used by, or with the permission of, the respondent so as to misrepresent the source of the goods or services on or in connection with which the mark is used.” The Board found that the record evidence “readily establishes blatant misuse of the FLANAX mark in a manner calculated to trade in the United States on the reputation and goodwill of petitioner’s mark created by its use in Mexico.”

14. 14 AIPLA Firm Logo DILUTION BY BLURRING

15. 15 AIPLA Firm Logo Chanel, Inc. v. Makarczyk, 110 USPQ2d 2013 (TTAB 2014) [precedential] The Board sustained Chanel, Inc.’s opposition to registration of the mark CHANEL for “real estate development and construction of commercial, residential and hotel property,” finding the mark likely to cause dilution-by-blurring of Opposer’s famous CHANEL mark even though Chanel had not involvement in Real Estate.

16. 16 AIPLA Firm Logo FACTS OF THE CASE – FINDINGS OF THE BOARD Chanel established that it began using its mark in the United States in the 1930s, and the mark has consistently been ranked as one of the most recognized and famous brands in the United States. The mark is famous for it perfume and retail outlets and has been used for many other “so-called” designer goods and services by itself and its licensees. Applicant was attempting to trade on the goodwill, fame and reputation generated by the CHANEL mark in order to promote and market his own services. Applicant is not a counterfeiter and is not trying to pass off his services as those of CHANEL. The Applicant sought to take advantage of Chanel’s reputation for taste, sophistication etc. to imply that his services shared these qualities. Applicant uses in connection with his real estate development and construction of commercial, residential and hotel property services not only the CHANEL mark but also the marks HERMES and PLAYBOY among others.”

17. 17 AIPLA Firm Logo ELEMENTS OF A CLAIM OF DILUTION BY BLURRING To prevail on a claim of Dilution by Blurring in a Board proceeding the plaintiff must prove: –(1) that plaintiff mark is famous and distinctive; –(2) the defendant is using a mark in commerce that allegedly dilutes the plaintiff’s famous mark; –(3) the defendant’s use of its mark began after the plaintiff’s mark became famous; and –(4) the defendant’s use of its mark is likely to cause dilution by blurring.

18. 18 AIPLA Firm Logo What is Dilution by Blurring? Dilution by Blurring occurs when: –(1) a substantial percentage of consumers, upon seeing the junior party’s use of a mark on its goods or services, are immediately reminded of the famous mark and associate the junior party’s use with the owner of the famous mark, even if they do not believe that the goods or services come from the famous mark's owner, or that the famous mark’s owner approves the goods or services; and –(2) that such association is likely to ‘impair’ the distinctiveness of the famous mark.

19. 19 AIPLA Firm Logo EVIDENCE OF USE - DILUTION BY BLURRING vs. SECTION 2(d) Unlike a Section 2(d) Claim, the Opposer asserting a claim of Dilution by Blurring –does not have to allege and prove a likelihood of confusion; –But must show that consumers of the Applicant’s goods will make an association between the mark and the mark of the Opposer. An Opposer must show that there is use of the mark by the Applicant and that the use causes the Dilution by Blurring.

20. 20 AIPLA Firm Logo OPPOSER’S NEAR FATAL ERROR ON THE ISSUE OF USE The case proceeded under the Board’s Accelerated Case Resolution (“ACR”) regime and the Applicant did not submit evidence or a brief. There was no direct evidence of the use of the mark. An Opposer asserting a dilution claim against an application based on an allegation of actual use in commerce pursuant to Section 1(a) may prove applicant’s use in commerce by direct evidence or (2) may rely on the application filing date as the date of constructive use.

21. 21 AIPLA Firm Logo Thanks for your attention! Questions? George W. Lewis Westerman, Hattori, Daniels & Adrian 1250 Connecticut Avenue NW Washington, D.C. 20036 (202) 822-4548 glewis@whda.com www.whda.com Name