1207.04(f) Application for Concurrent Use Registration Pursuant to Court Decree
Under Section 1(a)(1) of the Trademark Act, 15 U.S.C.
§1051(a)(1), an application based on use in commerce must be filed by the owner
of the mark. A §1(a) application must include a verified statement that the
applicant believes it is the owner of the mark sought to be registered. 15 U.S.C.
§1051(a)(3)(A); 37 C.F.R. §2.33(b)(1). An application that is not filed by the
owner is void. See
TMEP §1201.02(b).
An application under §1(b) or §44 of the Act, 15 U.S.C. §1051(b)
or §1126, must be filed by a party who is entitled to use the mark in commerce,
and must include a verified statement that the applicant is entitled to use the
mark in commerce and that the applicant has a bona fide intention to use the
mark in commerce as of the application filing date. 15 U.S.C. §§1051(b)(3),
1126(d)(2) and 1126(e); 37 C.F.R. §2.33(b)(2). When the person designated as
the applicant was not the person with a bona fide intention to use the mark in
commerce, the application is void. See
TMEP §1201.02(b).
In a §1(b) application, before the mark can be registered, the
applicant must file an amendment to allege use under 15 U.S.C. §1051(c) (see
TMEP §§1104
et seq.) or a statement of use under 15 U.S.C. §1051(d) (see
TMEP §§1109
et seq.) that states that the applicant is the owner of the
mark. 15 U.S.C. §§1051(b)(3)(A) and (B); 37 C.F.R. §§2.76(b)(1), and2.88(b)(1).
In a §44 application, the applicant must be the owner of the
foreign application or registration on which the United States application is
based as of the filing date of the United States application. See
TMEP§1005.
An application under §66(a) of the Trademark Act (i.e., a
request for extension of protection of an international registration to the
United States under the Madrid Protocol), must be filed by the holder of the
international registration. 15 U.S.C. §1141e(a). The application must include
a verified statement that the applicant has a bona fide intention to use the
mark in commerce. 15 U.S.C. §1141(5). The verified statement in a §66(a)
application is part of the international registration on file at the
International Bureau of the World Intellectual Property Organization ("IB").
The IB will have established that the international registration includes this
verified statement before it sends the request for extension of protection to
the United States Patent and Trademark Office
("USPTO"). See
TMEP §804.06.
The request for extension of protection
remains part of the international registration, and ownership is determined by
the IB. See
TMEP §501.07
regarding assignment of §66(a) applications.
In an application under §1 of the Trademark Act, an applicant may
base its claim of ownership of a trademark or a service mark on:
(1) its own exclusive use of the mark;
(2) use of the mark solely by a related company whose use
inures to the applicant's benefit (see
TMEP §§1201.03
et seq.);
or
(3) use of the mark both by the applicant and by a related
company whose use inures to the applicant's benefit (see
TMEP §1201.05).
Where the mark is used by a related company, the owner is the
party who controls the nature and quality of the goods sold or services
rendered under the mark. The owner is the only proper party to apply for
registration. 15 U.S.C. §1051. See
TMEP §§1201.03
et seq. for
additional information about use by related companies.
The examining attorney should accept the applicant's statement
regarding ownership of the mark unless it is clearly contradicted by
information in the record. In re Los Angeles Police Revolver and Athletic
Club, Inc., 69 USPQ2d 1630 (TTAB 2004).
The Office does not inquire about the relationship between the
applicant and other parties named on the specimens or elsewhere in the record,
except when the reference to another party clearly contradicts the applicant's
verified statement that it is the owner of the mark or entitled to use the
mark. Moreover, where the application states that use of the mark is by a
related company or companies, the examining attorney should not require any
explanation of how the applicant controls such use.
The above provisions also apply to service marks, collective
marks and certification marks, except that, by definition, collective marks andcertification marks are not used by the owner of the mark, but are used by
others under the control of the owner. 15 U.S.C. §§1053 and 1054. See
TMEP §§1303.01
,
1304.03
and
1306.01(a).
See
TMEP §1201.04
for information about when an examining
attorney should issue an inquiry or refusal with respect to ownership.
The applicant may be any person or entity capable of suing andbeing sued in a court of law. See
TMEP §§803
et seq. for the
appropriate format for identifying the applicant and setting forth the relevant
legal entity. See
TMEP §1201.03(a)
regarding the form for indicating
that the mark is used solely by a related company.
An application must be filed by the party who is the owner of (or
is entitled to use) the mark as of the application filing date. See
TMEP §1201.
An application based on use in commerce under 15 U.S.C. §1051(a)
must be filed by the party who owns the mark on the application filing date.
If the applicant does not own the mark on the application filing date, the
application is void. 37 C.F.R. §2.71(d). Huang v. Tzu Wei Chen Food
Co. Ltd., 849 F.2d 1458, 7 USPQ2d 1335 (Fed. Cir. 1988).
If the record indicates that the applicant is not the owner of
the mark, the examining attorney should refuse registration on that ground.
The statutory basis for this refusal is §1 of the Trademark Act, 15 U.S.C.
§1051, and, where related company issues are relevant, §§5 and 45, 15 U.S.C.
§§1055 and 1127. The examining attorney should not have the filing date
cancelled or refund the application filing fee.
In an application under §1(b) or §44 of the Trademark Act, 15 U.S.C.
§1051(b) or §1126, the applicant must be entitled to use the mark in commerce
on the application filing date, and the application must include a verified
statement that the applicant has a bona fide intention to use the mark in
commerce. 15 U.S.C. §§1051(b)(3)(A), 1051(b)(3)(B), 1126(d)(2) and 1126(e).
When the person designated as the applicant was not the person with a bona fide
intention to use the mark in commerce at the time the application was filed,
the application is void. American
Forests v. Sanders, 54 USPQ2d
1860 (TTAB 1999), aff'd, 232 F.3d 907 (Fed. Cir. 2000) (intent-to-use
application filed by an individual held void, where the entity that had a bona
fide intention to use the mark in commerce on the application filing date was a
partnership composed of the individual applicant and her husband). However, the
examining attorney will not inquire into the bona fides, or good faith, of an
applicant's asserted intention to use a mark in commerce during ex parte
examination, unless there is evidence in the record clearly indicating that the
applicant does not have a bona fide intention to use the mark in commerce. See
TMEP §1101.
When an application is filed in the name of the wrong party, this
defect cannot be cured by amendment or assignment. 37 C.F.R. §2.71(d);
TMEP§803.06.
However, if the application was filed by the owner, but there was a
mistake in the manner in which the applicant's name is set forth in the
application, this may be corrected. See
TMEP §1201.02(c)
for examples
of correctable and non-correctable errors.
See
TMEP §1201
regarding
ownership of a §66(a) application.
If the party applying to register the mark is in fact the owner
of the mark, but there is a mistake in the manner in which the name of the
applicant is set out in the application, the mistake may be corrected by
amendment. U.S. Pioneer Electronics Corp. v. Evans Marketing, Inc., 183
USPQ 613 (Comm'r Pats. 1974). However, the application may not be
amended to designate another entity as the applicant. 37 C.F.R. §2.71(d);
TMEP§803.06.
An application filed in the name of the wrong party is void andcannot be corrected by amendment. In re Tong Yang Cement Corp., 19 USPQ2d
1689 (TTAB 1991).
The following are examples of correctable errors in identifying
the applicant:
(1) If the applicant identifies itself by a name under which
it does business, which is not its name as a legal entity, then amendment to
state the applicant's correct legal name is permitted.
(2) If the applicant mistakenly names an operating division
that is not a legal entity as the owner, then the applicant's name may be
amended. See
TMEP §1201.02(d).
(3) Clerical errors such as the mistaken addition or
omission of "The" or "Inc." in the applicant's name may be corrected by
amendment.
(4) If the record is ambiguous as to who owns the mark,
e.g., an individual and a corporation are each identified as the owner in
different places in the application, the application may be amended to indicate
the proper applicant.
(5) If the owner of a mark legally changed its name before
filing an application, but mistakenly lists its former name on the application,
the error may be corrected because the correct party filed, but merely
identified itself incorrectly. In re Techsonic Industries, Inc., 216 USPQ
619 (TTAB 1982).
(6) If an applicant has been identified as "A and B, doing
business as The AB Company, a partnership," and the true owner is a partnership
organized under the name The AB Company and composed of A and B, the
applicant's name should be amended to "The AB Company, a partnership composed
of A and B."
(7) If an applicant has been identified as "ABC Corporation,
formerly known as XYZ, Inc.," and the correct entity is "XYZ, Inc.," the
applicant's name may be amended to "XYZ, Inc.," as long as "ABC Corporation,
formerly known as XYZ, Inc." was not a different existing legal entity.
Cf. Custom Computer Services Inc. v. Paychex Properties Inc., 337 F.3d
1334, 67 USPQ2d 1638, 1640 (Fed. Cir. 2003).
To correct an obvious mistake of this nature, a verification or
declaration is not normally necessary.
The following are examples of non-correctable errors in
identifying the applicant:
(1) If the president of a corporation is identified as the
owner of the mark when in fact the corporation owns the mark, the application
is void as filed because the applicant is not the owner of the mark.
(2) If an application is filed in the name of entity A, when
the mark was assigned to entity B before the application filing date, the
application is void as filed because the applicant was not the owner of the
mark at the time of filing. Huang v. Tzu Wei Chen Food Co. Ltd., 849
F.2d 1458, 7 USPQ2d 1335 (Fed. Cir. 1988) (application filed by an individual
two days after ownership of the mark was transferred to a newly formed
corporation held void).
(3) If the application is filed in the name of a joint
venturer when the mark is owned by the joint venture, the applicant's name
cannot be amended. In re Tong Yang Cement Corp., supra.
(4) If an application is filed in the name of corporation A
and a sister corporation (corporation B) owns the mark, the application is void
as filed because the applicant is not the owner of the mark.
An operating division that is not a legal entity that can sue andbe sued does not have standing to own a mark or to file an application to
register a mark. The application must be filed in the name of the company of
which the division is a part. In re Cambridge Digital Systems, 1 USPQ2d
1659, 1660 n.1 (TTAB 1986). An operating division's use is considered to be
use by the applicant and not use by a related company; therefore, reference to
related-company use is permissible but not necessary.
See
TMEP Chapter 500
regarding changes of ownership andchanges of name subsequent to filing an application for registration, and
TMEP§§502.02
et seq. regarding the procedure for requesting that a
certificate of registration be issued in the name of an assignee or in an
applicant's new name.
Section 5 of the Trademark Act, 15 U.S.C. §1055, states, in part,
as follows:
Where a registered mark or a mark sought to be registered is or
may be used legitimately by related companies, such use shall inure to the
benefit of the registrant or applicant for registration, and such use shall not
affect the validity of such mark or of its registration, provided such mark is
not used in such manner as to deceive the public.
Section 45 of the Act, 15 U.S.C. §1127, defines "related company"
as follows:
The term "related company" means any person whose use of a mark
is controlled by the owner of the mark with respect to the nature and quality
of the goods or services on or in connection with which the mark is used.
Thus, §5 of the Act permits applicants for registration to rely
on use of the mark by related companies. Either a natural person or a juristic
person may be a related company. 15 U.S.C. §1127.
The essence of related-company use is the control exercised over
the nature and quality of the goods or services on or in connection with which
the mark is used. When a mark is used by a related company, use of the mark
inures to the benefit of the party who controls the nature and quality of the
goods or services. This party is the owner of the mark and, therefore, is the
only party that may apply to register the mark. Smith International, Inc.
v. Olin Corp., 209 USPQ 1033, 1044 (TTAB 1981).
Reliance on related-company use requires, inter alia, that
the related company use the mark in connection with the same goods or services
recited in the application. In re Admark, Inc., 214 USPQ 302 (TTAB
1982) (related company use not at issue where the applicant sought registration
of a mark for advertising agency services and the purported related company
used the mark for retail store services).
A related company is different from a successor in interest who
is in privity with the predecessor in interest for purposes of determining the
right to register. Wells Cargo, Inc. v. Wells Cargo, Inc., 197 USPQ 569
(TTAB 1977), aff'd, 606 F.2d 961, 203 USPQ 564 (C.C.P.A. 1979).
See
TMEP §1201.03(c)
regarding wholly owned related
companies, §1201.03(d) regarding corporations with common stockholders,
directors or officers, §1201.03(e) regarding sister corporations, and§1201.03(f) regarding license and franchise situations.
If the mark is not being used by the applicant but is being used
by one or more related companies whose use inures to the benefit of the
applicant under §5 of the Act, then these facts must be disclosed in the
application. 37 C.F.R. §2.38(b). See Pease Woodwork Co., Inc. v. Ready
Hung Door Co., Inc., 103 USPQ 240 (Comm'r Pats. 1954); Industrial
Abrasives, Inc. v. Strong, 101 USPQ 420 (Comm'r Pats. 1954). Use that
inures to the applicant's benefit is a proper and sufficient support for an
application and satisfies the requirement of 37 C.F.R. §2.33(b)(1) that a §1(a)
application specify that the applicant has adopted and is using the
mark.
The party who controls the nature and quality of the goods or
services on or in connection with which the mark is used should be set forth as
the applicant. In an application under §1(a) of the Trademark Act, the
applicant should state in the body of the application that the applicant has
adopted and is using the mark through its related company (or equivalent
explanatory wording). In a §1(b) application, the statement that the applicant
is using the mark through a related company should be included in the
amendment to allege use under 15 U.S.C. §1051(c) (see
TMEP §§1104
etseq.) or statement of use under 15 U.S.C. §1051(d) (see
TMEP §§1109
etseq.).
The applicant is not required to give the name of the
related-company user unless it is necessary to explain information in the
record that clearly contradicts the applicant's verified claim of ownership of
the mark.
The applicant may claim the benefit of use by a related company
in an amendment to the application. Greyhound Corp. v. Armour Life
Insurance Co., 214 USPQ 473, 475 (TTAB 1982).
If the applicant and a related company both use the mark, and it
is the applicant's own use of the mark that is relied on in the application,
then the applicant does not have to include a reference to use by a related
company in the application. See
TMEP §1201.05.
Where the application states that use of the mark is by a related
company or companies, the Office does not require an explanation of how the
applicant controls the use of the mark.
Similarly, the Office does not inquire about the relationship
between the applicant and other parties named on the specimens or elsewhere in
the record, except when the reference to another party clearly contradicts the
applicant's verified statement that it is the owner of the mark or entitled to
use the mark. See
TMEP §1201.04.
Related-company use includes situations where a wholly owned
related company of the applicant uses the mark or the applicant is wholly owned
by a related company that uses the mark.
Frequently, related companies comprise parent and wholly owned
subsidiary corporations. Either a parent corporation or a subsidiary
corporation may be the proper applicant, depending on the facts concerning
ownership of the mark. The Office will consider the filing of the application
in the name of either the parent or the subsidiary to be the expression of the
intention of the parties as to ownership in accord with the arrangements
between them.
Either an individual or a juristic entity may own a mark that is
used by a wholly owned related company. See In re Hand, 231 USPQ 487
(TTAB 1986).
Corporations are not "related companies" within the meaning of §5
of the Trademark Act, 15 U.S.C. §1055, merely because they have the same
stockholders, directors or officers, or because they occupy the same premises.
In re Raven Marine, Inc., 217 USPQ 68, 69 (TTAB 1983) (statement that
both the applicant corporation and the corporate user of the mark have the same
principal stockholder and officer held insufficient to show that the user is a
related company).
If an individual applicant is not the sole owner of the
corporation that is using the mark, the question of whether the corporation is
a "related company" depends on whether the applicant maintains control over the
nature and quality of the goods or services such that use of the mark inures to
the applicant's benefit. A formal written licensing agreement between the
parties is not necessary, nor is its existence sufficient to establish
ownership rights. The critical question is whether the applicant sufficiently
controls the nature and quality of the goods or services with which the mark is
used. See Pneutek, Inc. v. Scherr, 211 USPQ 824 (TTAB 1981) (detailed
written agreement and substantial evidence in the record indicating that the
applicant, an individual, exercised control over the nature and quality of the
goods sold under the mark by the user corporation held sufficient to show that
the corporation was a related company).
Similarly, where an individual applicant is not the sole owner of
the corporation that is using the mark, the fact that the individual applicant
is a stockholder, director of officer in the corporation is insufficient in
itself to establish that the corporation is a related company. The question
depends on whether the applicant maintains control over the nature and quality
of the goods or services.
See
TMEP §1201.03(c)
regarding use by wholly owned related
companies.
The fact that two sister corporations are controlled by a single
parent corporation does not mean that they are related companies. Where two
corporations are wholly owned subsidiaries of a common parent, use by one
sister corporation is not considered to inure to the benefit of the other
unless the applicant sister corporation exercises appropriate control over the
nature and quality of the goods or services on or in connection with which the
mark is used. In re Pharmacia Inc., 2 USPQ2d 1883 (TTAB 1987);
Greyhound Corp. v. Armour Life Insurance Co., 214 USPQ 473 (TTAB 1982).
See
TMEP §1201.03(c)
regarding use by wholly owned related
companies.
The Office accepts applications by parties who claim to be owners
of marks through use by controlled licensees, pursuant to a contract or
agreement. Pneutek, Inc. v. Scherr, 211 USPQ 824, 833 (TTAB 1981).
A controlled licensing agreement may be recognized whether oral
or in writing. In re Raven Marine, Inc., 217 USPQ 68, 69 (TTAB 1983).
If the application indicates that use of the mark is pursuant to
a license or franchise agreement, and the record contains nothing that
contradicts the assertion of ownership by the applicant (i.e., the
licensor or franchisor), the examining attorney will not inquire about the
relationship between the applicant and the related company (i.e., the
licensee or franchisee).
Ownership rights in a trademark or service mark may be acquired
and maintained through the use of the mark by a controlled licensee even when
the only use of the mark has been made, and is being made, by the licensee. Turner
v. HMH Publishing Co., Inc., 380 F.2d 224, 154 USPQ 330, 334 (5th
Cir. 1967), cert. denied, 389 U.S. 1006, 156 USPQ 720 (1967); Central
Fidelity Banks, Inc. v. First Bankers Corp. of Florida, 225 USPQ 438, 440
(TTAB 1984) (use of the mark by petitioner's affiliated banks considered to
inure to the benefit of petitioner bank holding company, even though the bank
holding company could not legally render banking services and thus could not
use the mark).
Joint applicants enjoy rights of ownership to the same extent as
any other "person" who has a proprietary interest in a mark. Therefore, joint
applicants may license others to use a mark and, by exercising sufficient
control and supervision of the nature and quality of the goods or services to
which the mark is applied, the joint applicants/licensors may claim the
benefits of the use by the related company/licensee. In re Diamond Walnut
Growers, Inc. and Sunsweet Growers Inc., 204 USPQ 507 (TTAB 1979).
Stores that are operating under franchise agreements from another
party are considered "related companies" of that party, and use of the mark by
the franchisee/store inures to the benefit of the franchisor. Mr. Rooter
Corp. v. Morris, 188 USPQ 392, 394 (E.D. La. 1975); Southland Corp. v.
Schubert, 297 F. Supp. 477, 160 USPQ 375, 381 (C.D. Cal. 1968).
In all franchise and license situations, the key to ownership is the
nature and extent of the control by the applicant of the goods or services to
which the mark is applied. A trademark owner who fails to exercise sufficient
control over licensees or franchisees may be found to have abandoned its rights
in the mark. See Hurricane Fence Co. v. A-1 Hurricane Fence Co. Inc.,
468 F. Supp. 975, 208 USPQ 314, 325-27 (S.D. Ala. 1979).
In general, where the application states that a mark is used by a
licensee or franchisee, the Office does not require an explanation of how the
applicant controls the use. See
TMEP §1201.03(b).
The Office does not inquire about the relationship between the
applicant and other parties named on the specimens or elsewhere in the record,
except when the reference to another party clearly contradicts the applicant's
verified statement that it is the owner of the mark or entitled to use the
mark.
The examining attorney should inquire about another party if the
record specifically states that another party is the owner of the mark, or if
the record specifically identifies the applicant in a manner that contradicts
the claim of ownership, for example, as a licensee. In these circumstances,
registration should be refused under §1 of the Trademark Act, on the ground
that the applicant is not the owner of the mark. Similarly, when the record
indicates that the applicant is a United States distributor, importer or other
distributing agent for a foreign manufacturer, the examining attorney should
require the applicant to establish its ownership rights in the United States in
accordance with
TMEP §1201.06(a).
Where the specimen of use indicates that the goods are
manufactured in a country other than the applicant's home country, the examining
attorney normally should not inquire whether the mark is used by a foreign
manufacturer. See
TMEP §1201.06(b).
Also, where the application states
that use of the mark is by related companies, an explanation of how the
applicant controls use of the mark by the related companies is not required. See
TMEP §1201.03(b).
An applicant's claim of ownership of a mark may be based on the
applicant's own use of the mark, even though there is also use by a related
company. The applicant is the owner by virtue of the applicant's own use, andthe application does not have to refer to use by a related company.
An applicant may claim ownership of a mark when the mark is
applied on the applicant's instruction. For example, if the applicant
contracts with another party to have goods produced for the applicant andinstructs the party to place the mark on the goods, that is the equivalent of
the applicant itself placing the mark on its own goods and reference to
related-company use is not necessary.
A distributor, importer or other distributing agent of the goods
of a manufacturer or producer does not acquire a right of ownership in the
manufacturer's or producer's mark merely because it moves the goods in trade. In
re Bee Pollen from England Ltd., 219 USPQ 163 (TTAB 1983); Audioson
Vertriebs - GmbH v. Kirksaeter Audiosonics, Inc., 196 USPQ 453 (TTAB 1977);
Jean D'Albret v. Henkel-Khasana G.m.b.H., 185 USPQ 317 (TTAB 1975); In
re Lettmann, 183 USPQ 369 (TTAB 1974); Bakker v. Steel Nurse of America
Inc., 176 USPQ 447 (TTAB 1972). A party that merely distributes goods
bearing the mark of a manufacturer or producer is neither the owner nor a
related-company user of the mark.
If the applicant merely distributes or imports goods for the
owner of the mark, registration must be refused under §1 of the Trademark Act, except
in the following situations:
(1) If a parent and wholly owned subsidiary relationship
exists between the distributor and the manufacturer, then the applicant's
statement that such a relationship exists disposes of an ownership issue. See
TMEP §1201.03(c).
(2) If an applicant is the United States importer or
distribution agent for a foreign manufacturer, then the applicant can register
the foreign manufacturer's mark in the United States, if the applicant submits
one of the following:
(a) written consent from the owner of the mark to
registration in the applicant's name, or
(b) written agreement or acknowledgment between the parties
that the importer or distributor is the owner of the mark in the United States,
or
(c) an assignment (or true copy) to the applicant of the
owner's rights in the mark as to the United States together with the business
and good will appurtenant thereto.
See In re Pharmacia Inc.,
2 USPQ2d 1883 (TTAB 1987); In re Geo. J. Ball, Inc., 153 USPQ 426 (TTAB
1967).
Where a specimen of use indicates that the goods are manufactured
in a country other than the applicant's home country, the examining attorney
normally should not inquire whether the mark is used by a foreign manufacturer.
If, however, information in the record clearly contradicts the applicant's
verified claim of ownership (e.g., a statement in the record that the
mark is owned by the foreign manufacturer and that the applicant is only an
importer or distributor), then registration must be refused under §1, 15 U.S.C.
§1051, unless registration in the United States by the applicant is supported
by the applicant's submission of one of the documents listed in
TMEP§1201.06(a).
Section 2(d) of the Trademark Act, 15 U.S.C. §1052(d), requires
that the examining attorney refuse registration when an applicant's mark, as
applied to the specified goods or services, so resembles a registered mark as
to be likely to cause confusion. In general, registration of confusingly
similar marks to separate legal entities is barred by §2(d). See, e.g., In
re Citibank, N.A., 225 USPQ 612 (TTAB 1985); In re Champion
International Corp., 220 USPQ 478 (TTAB 1982); In re Air Products, Inc.,
124 USPQ 81 (TTAB 1960). However, the Court of Appeals for the Federal Circuit
has held that, where the applicant is related in ownership to a company that
owns a registered mark that would otherwise give rise to a likelihood of
confusion, the examining attorney must consider whether, in view of all the
circumstances, use of the mark by the applicant is likely to confuse the public
about the source of the applicant's goods because of the resemblance of the
applicant's mark to the mark of the other company. The Court stated that:
The question is whether, despite the similarity of the marks
and the goods on which they are used, the public is likely to be confused about
the source of the hair straightening products carrying the trademark
"WELLASTRATE." In other words, is the public likely to believe that the source
of the product is Wella U.S. rather than the German company or the Wella
organization.
In re Wella A.G., 787 F.2d 1549, 1552, 229 USPQ 274, 276
(Fed. Cir. 1986). The Court remanded the case to the Board for consideration
of the likelihood of confusion issue.
In ruling on that issue, the Board concluded that there was no
likelihood of confusion, stating as follows:
[A] determination must be made as to whether there exists a
likelihood of confusion as to source, that is, whether purchasers would
believe that particular goods or services emanate from a single source, when in
fact those goods or services emanate from more than a single source. Clearly,
the Court views the concept of "source" as encompassing more than "legal
entity." Thus, in this case, we are required to determine whether Wella A.G.
and Wella U.S. are the same source or different sources....
The existence of a related company relationship between Wella
U.S. and Wella A.G. is not, in itself, a basis for finding that any "WELLA"
product emanating from either of the two companies emanates from the same
source. Besides the existence of a legal relationship, there must also be a
unity of control over the use of the trademarks. "Control" and "source" are
inextricably linked. If, notwithstanding the legal relationship between
entities, each entity exclusively controls the nature and quality of the goods
to which it applies one or more of the various "WELLA" trademarks, the two
entities are in fact separate sources. Wella A.G. has made of record a
declaration of the executive vice president of Wella U.S., which declaration
states that Wella A.G. owns substantially all the outstanding stock of Wella U.S.
and "thus controls the activities and operations of Wella U.S., including the
selection, adoption and use of the trademarks." While the declaration contains
no details of how this control is exercised, the declaration is sufficient,
absent contradictory evidence in the record, to establish that control over the
use of all the "WELLA" trademarks in the United States resides in a single
source.
In re Wella A.G., 5 USPQ2d 1359, 1361 (TTAB 1987)
(emphasis in original), rev'd on other grounds, 858 F.2d 725, 8 USPQ2d
1365 (Fed. Cir. 1988).
Therefore, in some limited circumstances, the close relationship
between related companies will obviate any likelihood of confusion in the
public mind because the related companies constitute a single source. See
TMEP §§1201.07(b)
et seq. for further information.
First, it is important to note that analysis under Wella
is not triggered until an applicant affirmatively asserts that a §2(d) refusal is
inappropriate because the applicant and the registrant, though separate legal
entities, constitute a single source, or the applicant raises an equivalent
argument. Examining attorneys should issue §2(d) refusals in any case where an
analysis of the marks and the goods or services of the respective parties
indicates a bar to registration under §2(d). The examining attorney should not
attempt to analyze the relationship between an applicant and registrant until
an applicant, in some form, relies on the nature of the relationship to obviate
a refusal under §2(d).
Once an applicant has made this assertion, the question is
whether the specific relationship is such that the two entities constitute a
"single source," so that there is no likelihood of confusion. The following
guidelines may assist the examining attorney in resolving questions of
likelihood of confusion when the marks are owned by related companies and the
applicant asserts unity of control. (Of course, in many of these situations,
the applicant may choose to attempt to overcome the §2(d) refusal by submitting
a consent agreement or other conventional evidence to establish no likelihood
of confusion. See In re Sumitomo Electric Industries, Ltd., 184 USPQ
365 (TTAB 1974). Another way to overcome a §2(d) refusal is to assign all
relevant registrations to the same party.)
If the applicant or the applicant's attorney represents that
either the applicant or the registrant owns all of the other entity,
and there is no contradictory evidence, then the examining attorney should
conclude that there is unity of control, a single source and no likelihood of
confusion. This would apply to an individual who owns all the stock of a
corporation, and to a corporation and a wholly owned subsidiary. In this
circumstance, additional representations or declarations should generally not
be required, absent contradictory evidence.
In Wella, the applicant provided a declaration stating
that the applicant owned substantially all of the stock of the
registrant and that the applicant thus controlled the activities of the
registrant, including the selection, adoption and use of trademarks. The Board
concluded that this declaration alone, absent contradictory evidence,
established unity of control, a single source and no likelihood of confusion.
Therefore, if either the applicant or the registrant owns substantially
all of the other entity and asserts control over the activities of the other
entity, including its trademarks, and there is no contradictory evidence, the
examining attorney should conclude that unity of control is present, that the
entities constitute a single source, and that there is no likelihood of
confusion under §2(d). In such a case the applicant should generally provide
these assertions in the form of an affidavit or declaration under 37 C.F.R.
§2.20.
If neither the applicant nor the registrant owns all or
substantially all of the other entity, the applicant bears a more substantial
burden to establish that unity of control is present. For instance, if both
the applicant and the registrant are wholly owned by a third common parent, the
applicant would have to provide detailed evidence to establish how one sister
corporation controlled the trademark activities of the other to establish unity
of control to support the contention that the sister corporations constitute a
single source. See In re Pharmacia Inc., 2 USPQ2d 1883 (TTAB 1987); Greyhound
Corp. v. Armour Life Ins. Co., 214 USPQ 473 (TTAB 1982). Likewise, where
an applicant and registrant have certain stockholders, directors or officers in
common, the applicant must demonstrate with detailed evidence or explanation
how those relationships establish unity of control. See Pneutek, Inc. v.
Scherr, 211 USPQ 824 (TTAB 1981). The applicant's evidence or explanation
should generally be supported by an affidavit or a declaration under 37 C.F.R.
§2.20.
In contrast to those circumstances where the relationship between
the parties may support a presumption of unity of control or at least afford an
applicant the opportunity to demonstrate unity of control, some relationships,
by their very nature, contradict any claim that unity of control is present.
For instance, if the relationship between the parties is that of licensor andlicensee, unity of control will ordinarily not be present. The licensing
relationship suggests ownership in one party and control by that one party over
only the use of a specific mark or marks, but not over the operations or
activities of the licensee generally. Thus, there is no unity of control andno basis for concluding that the two parties form a single source. Precisely
because unity of control is absent, a licensing agreement is necessary. The
licensing agreement enables the licensor/owner to control specific activities
to protect its interests as the sole source or sponsor of the goods or services
provided under the mark. Therefore, in these situations, it is most unlikely
that an applicant could establish unity of control to overcome a §2(d) refusal.
In an application under §1 of the Act, the examining attorney
must determine whether the subject matter for which registration is sought is
used as a trademark by reviewing all evidence (e.g., the specimens of
use and any promotional material) of record in the application. See In re
Safariland Hunting Corp., 24 USPQ2d 1380 (TTAB 1992) (examining attorney
should look primarily to specimens to determine whether a designation would be
perceived as a source indicator, but may also consider other evidence, if there
is other evidence of record).
Not everything that a party adopts and uses with the intent that
it function as a trademark necessarily achieves this goal or is legally capable
of doing so, and not everything that is recognized or associated with a party
is necessarily a registrable trademark. As the Court of Customs and Patent
Appeals observed in In re Standard Oil Co., 275 F.2d 945, 947, 125 USPQ
227, 229 (C.C.P.A. 1960):
The Trademark Act is not an act to register words but to
register trademarks. Before there can be registrability, there must be a
trademark (or a service mark) and, unless words have been so used, they cannot
qualify for registration. Words are not registrable merely because they
do not happen to be descriptive of the goods or services with which they are
associated.
Sections 1 and 2 of the Trademark Act, 15 U.S.C. §§1051 and 1052,
require that the subject matter presented for registration be a "trademark."
Section 45 of the Act, 15 U.S.C. §1127, defines that term as follows:
The term "trademark" includes any word, name, symbol, or
device, or any combination thereof--
(1) used by a person, or
(2) which a person has a bona fide intention to use in
commerce and applies to register on the principal register established by this
Act,
to identify and distinguish his or her goods, including a
unique product, from those manufactured or sold by others and to indicate the
source of the goods, even if that source is unknown.
Thus, §§1, 2 and 45 of the Trademark Act, 15 U.S.C. §§1051, 1052,
and 1127, provide the statutory basis for refusal to register on the Principal
Register subject matter that, due to its inherent nature or the manner in which
it is used, does not function as a mark to identify and distinguish the
applicant's goods. The statutory basis for refusal of registration on the
Supplemental Register of matter that does not function as a trademark because
it does not fit within the statutory definition of a trademark is §§23 and 45,
15 U.S.C. §§1091 and 1127.
When the examining attorney refuses registration on the ground
that the subject matter is not used as a trademark, the examining attorney
should explain the specific reason for the conclusion that the subject
matter is not used as a trademark. See
TMEP §§1202.01
et seq.
for a discussion of situations in which it may be appropriate, depending on the
circumstances, for the examining attorney to refuse registration on the ground
that the asserted trademark does not function as a trademark, e.g.,
TMEP§§1202.01
(trade names), 1202.02(a) et seq. (functionality), 1202.03
(ornamentation), 1202.04 (informational matter), 1202.05 (color marks), 1202.06
(goods in trade), 1202.07 (columns or sections of publications), 1202.08 (title
of single creative work), 1202.09 (names of artists and authors), 1202.10
(model or grade designations), 1202.11 (background designs and shapes), 1202.12
(varietal and cultivar names).
The presence of the letters "SM" or "TM" cannot transform an
otherwise unregistrable designation into a mark. In re Remington Products
Inc., 3 USPQ2d 1714 (TTAB 1987); In re Anchor Hocking Corp., 223
USPQ 85 (TTAB 1984); In re Minnetonka, Inc., 212 USPQ 772 (TTAB 1981).
See
TMEP §§1301.02
et seq. regarding use of subject
matter as a service mark;
TMEP §§1302
through 1304 regarding use of subject
matter as a collective mark; and
TMEP §1306
regarding use of subject matter as
a certification mark.
The name of a business or company is a trade name. The Trademark
Act distinguishes trade names from trademarks by definition. While a trademark
is used to identify and distinguish the trademark owner's goods from those
manufactured or sold by others and to indicate the source of the goods, "trade
name" and "commercial name" are defined in §45 of the Act, 15 U.S.C. §1127, as
follows:
The terms "trade name" and "commercial name" mean any name used
by a person to identify his or her business or vocation.
The Trademark Act does not provide for registration of trade
names. See In re Letica Corp., 226 USPQ 276, 277 (TTAB 1985) ("[T]here
was a clear intention by the Congress to draw a line between indicia which
perform only trade name functions and indicia which perform or also perform the
function of trademarks or service marks.").
If the examining attorney determines that matter for which
registration is requested is merely a trade name, registration must be refused
both on the Principal Register and on the Supplemental Register. The statutory
basis for refusal of trademark registration on the ground that the matter is
used merely as a trade name is §§1, 2 and 45 of the Trademark Act, 15 U.S.C.
§§1051, 1052 and 1127, and, in the case of matter sought to be registered for
services, §§1, 3, and 45, 15 U.S.C. §§1051, 1053 and 1127.
A designation may function as both a trade name and a trademark
or service mark. See In re Walker Process Equipment Inc., 233 F.2d 329,
332, 110 USPQ 41, 43 (C.C.P.A. 1956), aff'g 102 USPQ 443 (Comm'r Pats.
1954).
If subject matter presented for registration in an application is
a trade name or part of a trade name, the examining attorney must determine
whether it is also used as a trademark or service mark by examining the
specimens and other evidence of record in the application file. See In re
Diamond Hill Farms, 32 USPQ2d 1383 (TTAB 1994) (DIAMOND HILL FARMS, as used
on containers for goods, found to be a tradename that identifies applicant as a
business entity rather than a mark that identifies applicant's goods anddistinguishes them from those of others).
Whether matter that is a trade name (or a portion thereof) also
performs the function of a trademark depends on the manner of its use and the
probable impact of the use on customers. See In re Unclaimed Salvage &
Freight Co., Inc., 192 USPQ 165, 168 (TTAB 1976) ("It is our opinion that
the foregoing material reflects use by applicant of the notation 'UNCLAIMED
SALVAGE & FREIGHT CO.' merely as a commercial, business, or trade name
serving to identify applicant as a viable business entity; and that this is or
would be the general and likely impact of such use upon the average person
encountering this material under normal circumstances and conditions
surrounding the distribution thereof."); In re Lytle Engineering & Mfg.
Co., 125 USPQ 308 (TTAB 1960) ("'LYTLE' is applied to the container for
applicant's goods in a style of lettering distinctly different from the other
portion of the trade name and is of such nature and prominence that it creates
a separate and independent impression.")
The presence of an entity designator in a name sought to be
registered and the proximity of an address are both factors to be considered in
determining whether a proposed mark is merely a trade name. In re Univar
Corp., 20 USPQ2d 1865, 1869 (TTAB 1991) ("[T]he mark "UNIVAR" independently
projects a separate commercial impression, due to its presentation in a
distinctively bolder, larger and different type of lettering and, in some
instances, its additional use in a contrasting color, and thus does more than
merely convey information about a corporate relationship.") See also Book
Craft, Inc. v. BookCrafters USA, Inc., 222 USPQ 724, 727 (TTAB 1984) ("That
the invoices ... plainly show ... service mark use is apparent from the fact
that, not only do the words 'BookCrafters, Inc.' appear in larger letters and a
different style of print than the address, but they are accompanied by a design
feature (the circularly enclosed ends of two books).").
A determination of whether matter serves
solely as a trade name rather than as a mark requires consideration of the way
the mark is used, as evidenced by the specimens. Therefore, no refusal on that
ground will be issued in an intent-to-use application until the applicant has
submitted specimens of use in conjunction with either an amendment to allege
use under 15 U.S.C. §1051(c) or a statement of use under 15 U.S.C. §1051(d).
When an applicant applies to register a product's design, product
packaging, color, or other trade dress for goods or services, the examining
attorney must consider two issues: (1) functionality; and (2)
distinctiveness. See TrafFix Devices, Inc. v. Marketing Displays, Inc.,
532 U.S. 23, 58 USPQ2d 1001, 1004-1005 (2001); Two Pesos, Inc. v. Taco
Cabana, Inc., 505 U.S. 763, 775, 23 USPQ2d 1081, 1086 (1992) (only
nonfunctional distinctive trade dress is protected). See
TMEP§§1202.02(a)
et seq. regarding functionality,
TMEP §§1202.02(b)
and
1212
et seq. regarding distinctiveness, and
TMEP §1202.02(c)
regarding
separate treatment of the two issues procedurally. With respect to the
functionality and distinctiveness issues in the specific context of color as a
mark, see
TMEP §§1202.05
and
1202.05(f).
Before October 30, 1998, there was no specific statutory
reference to functionality as a ground for refusal, and functionality refusals
were thus issued as failure-to-function refusals under Sections 1, 2 and 45 of
the Trademark Act, 15 U.S.C. §§1051, 1052 and 1127.
Effective October 30, 1998, the Technical Corrections to
Trademark Act of 1946, Pub. L. No. 105-330, §201, 112 Stat. 3064, 3069, amended
the Trademark Act to expressly prohibit registration on either the Principal or
Supplemental Register of matter that is functional:
•
Section 2(e)(5) of the Trademark Act, 15 U.S.C. §1052(e)(5),
prohibits registration on the Principal Register of "matter that, as a whole,
is functional."
•
Section 2(f) of the Act, 15 U.S.C. §1052(f), provides that matter
that, as a whole, is functional may not be registered even on a showing that it
has become distinctive.
•
Section 23(c) of the Act, 15 U.S.C. §1091(c), provides that a
mark that, as a whole, is functional may not be registered on the Supplemental
Register.
•
Section 14(3) of the Act, 15 U.S.C. §1064(3), lists functionality
as a ground that can be raised in a cancellation proceeding more than five
years after the date of registration.
•
Section 33(b)(8) of the Act, 15 U.S.C. §1115(b)(8), lists
functionality as a statutory defense to infringement in a suit involving an
incontestable registration.
These amendments codified case law and the longstanding Office
practice of refusing registration of matter that is functional.
The functionality doctrine, which prohibits registration of
functional product features, is intended to encourage legitimate competition by
maintaining the proper balance between trademark law and patent law. As the
Supreme Court explained, in Qualitex Co. v. Jacobson Products Co., Inc.,
514 U.S. 159, 164, 34 USPQ2d 1161, 1163 (1995):
The functionality doctrine prevents trademark law, which seeks
to promote competition by protecting a firm's reputation, from instead
inhibiting legitimate competition by allowing a producer to control a useful
product feature. It is the province of patent law, not trademark law, to
encourage invention by granting inventors a monopoly over new product designs
or functions for a limited time, 35 U.S.C. §§154, 173, after which competitors
are free to use the innovation. If a product's functional features could be
used as trademarks, however, a monopoly over such features could be obtained without
regard to whether they qualify as patents and could be extended forever
(because trademarks may be renewed in perpetuity).
In other words, the functionality doctrine ensures that
protection for utilitarian product features be properly sought through a
limited-duration utility patent, and not through the potentially unlimited
protection of a trademark registration. Upon expiration of a utility patent,
the invention covered by the patent enters the public domain, and the
functional features disclosed in the patent may then be copied by others - thus
encouraging advances in product design and manufacture. In TrafFix Devices,
Inc. v. Marketing Displays, Inc., 532 U.S. 23, 34-35, 58 USPQ2d 1001, 1007
(2001), the Supreme Court reiterated this rationale, also noting that the
functionality doctrine is not affected by evidence of acquired distinctiveness:
The Lanham Act does not exist to reward manufacturers for their
innovation in creating a particular device; that is the purpose of the patent
law and its period of exclusivity. The Lanham Act, furthermore, does not
protect trade dress in a functional design simply because an investment has
been made to encourage the public to associate a particular functional feature
with a single manufacturer or seller.
Thus, even where the evidence establishes that consumers have
come to associate a functional product feature with a single source, trademark
protection will not be granted in light of the public policy reasons just
stated. Id.
Functional matter cannot be protected as trade dress or a
trademark. 15 U.S.C. §§1052(e)(5) and (f), 1091(c), 1064(3), and 1115(b). A
feature is functional as a matter of law if it is "essential to the use or
purpose of the product or if it affects the cost or quality of the product." TrafFix
Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23, 58 USPQ2d 1001,
1006 (2001); Qualitex Co. v. Jacobson Products Co., Inc., 514 U.S. 159,
165, 34 USPQ2d 1161, 1163-64 (1995); Inwood Laboratories, Inc. v. Ives
Laboratories, Inc., 456 U.S. 844, 850, 214 USPQ 1, 4 n.10 (1982).
While some courts had developed a definition of functionality
that focused solely on "competitive need" - thus finding a particular product
feature functional only if competitors needed to copy that design in order to
compete effectively - the Supreme Court held that this "was incorrect as a
comprehensive definition" of functionality. TrafFix, 532 U.S. at 33, 58
USPQ2d at 1006. The Court emphasized that where a product feature meets the
traditional functionality definition - that is, it is essential to the use or
purpose of the product or affects the cost or quality of the product - then the
feature is functional. Id. However, an inquiry into competitive need
for the product design or feature at issue may be appropriate in cases where
the mark sought to be registered is a color or other matter that does not
easily fit within the "utilitarian" definition of functionality. Id. at
1006-07 (stating that inquiring into the issue of "significant
non-reputation-related disadvantage" (i.e., competitive need) would be
appropriate in cases of "aesthetic functionality," such as Qualitex). See
TMEP §§1202.02(a)(iii)(C)
and
1202.05
regarding the issues of "aesthetic functionality"
and color as a mark.
The determination that a proposed mark is functional constitutes,
for public policy reasons, an absolute bar to registration on either the
Principal Register or the Supplemental Register - regardless of evidence
showing that the proposed mark has acquired distinctiveness. TrafFix,
532 U.S. at 29, 58 USPQ2d at 1006. See also Valu Engineering, Inc. v.
Rexnord Corp., 278 F.3d 1268, 61 USPQ2d 1422 (Fed. Cir. 2002); In re
Controls Corp. of America, 46 USPQ2d 1308, 1311 (TTAB 1998).
See
TMEP §§1202.02(a)(v)
et seq. regarding
evidentiary considerations pertaining to functionality refusals.
Prior to 2002, the Office used the terms "de facto" and "de
jure" in assessing whether "subject matter" (usually a product feature or
the configuration of the goods) presented for registration was functional.
This distinction originated with the Court of Customs and Patent Appeals' Morton-Norwich
decision, which was discussed by the Federal Circuit in Valu Engineering,
Inc. v. Rexnord Corp., 278 F.3d 1268, 61 USPQ2d 1422, 1425 (Fed. Cir.
2002):
Our decisions distinguish de facto functional features,
which may be entitled to trademark protection, from de jure functional
features, which are not. 'In essence, de facto functional means that
the design of a product has a function, i.e., a bottle of any design
holds fluid.' In re R.M. Smith, Inc., 734 F.2d 1482, 1484, 222 USPQ 1,
3 (Fed. Cir. 1984). De facto functionality does not necessarily defeat
registrability. Morton-Norwich, 671 F.2d [1332,] at 1337, 213 USPQ [9]
at 13 [(C.C.P.A. 1982)] (A design that is de facto functional, i.e.,
'functional' in the lay sense ... may be legally recognized as an indication of
source.'). De jure functionality means that the product has a
particular shape 'because it works better in this shape.' Smith, 734
F.2d at 1484, 222 USPQ at 3.
However, in three Supreme Court decisions involving functionality
- Qualitex Co. v. Jacobson Products Co., Inc., 514 U.S. 159, 34 USPQ2d
1161 (1995), Wal-Mart Stores, Inc. v. Samara Brothers, Inc., 529
U.S. 205, 54 USPQ2d 1065 (2000), and TrafFix Devices, Inc. v. Marketing
Displays, Inc., 532 U.S. 23, 58 USPQ2d 1001 (2001) - the Court did not use
the "de facto/de jure" distinction. Nor were these terms used when the
Trademark Act was amended to expressly prohibit registration of matter that is
"functional." Technical Corrections to Trademark Act of 1946, Pub. L. No.
105-330, §201, 112 Stat. 3064, 3069 (1998). Accordingly, in general, examining
attorneys no longer make this distinction in Office actions which refuse
registration based on functionality.
De facto functionality is not a ground for refusal. In
re Ennco Display Systems Inc., 56 USPQ2d 1279, 1282 (TTAB 2000); In re
Parkway Machine Corp., 52 USPQ2d 1628, 1631 n.4 (TTAB 1999).
The concept of "aesthetic functionality" (as opposed to
"utilitarian functionality") has for many years been the subject of much
confusion as to its precise meaning, as well as whether it is even a viable
legal principle. While the Court of Customs and Patent Appeals (the
predecessor to the Court of Appeals for the Federal Circuit) appeared to reject
the doctrine of aesthetic functionality in In re DC Comics, Inc., 689
F.2d 1042, 215 USPQ 394 (C.C.P.A. 1982), the Supreme Court later referred to
aesthetic functionality as a valid legal concept in TrafFix Devices, Inc. v.
Marketing Displays, Inc., 532 U.S. 23, 58 USPQ2d 1001 (2001). In
discussing the proper definition of "functionality," the Court distinguished
its previous decision in Qualitex Co. v. Jacobson Products Co., Inc.,
514 U.S. 159, 34 USPQ2d 1161 (1995), specifically contrasting the fact that,
unlike the issue currently before the Court, in Qualitex "aesthetic
functionality was the central question, there having been no indication that
the green-gold color of the laundry press pad had any bearing on the use or
purpose of the product or its cost or quality." TrafFix, 532 U.S. at
33, 58 USPQ2d at 1006-07. Although the references to aesthetic functionality
in the TrafFix decision are dicta, the Court's use of this
terminology appears to indicate that the concept of aesthetic functionality -
at least when used properly - is a viable legal principle.
The confusion regarding this concept stems from widespread misuse
of the term "aesthetic functionality" in cases involving ornamentation issues,
with some courts having mistakenly expanded the category of "functional" marks
to include matter that is solely ornamental, essentially on the theory that
such matter serves an "aesthetic function" or "ornamentation function." It is
this incorrect use of the term "aesthetic functionality" in connection with
ornamentation cases that was rejected by the Court of Customs and Patent
Appeals. See In re DC Comics, Inc., 689 F.2d 1042, 215 USPQ 394,
397, 399-401 (majority opinion and Rich, J., concurring) (C.C.P.A. 1982)
(holding, in a case involving features of toy dolls, that the Board had
improperly "intermingled the concepts of utilitarian functionality and what has
been termed 'aesthetic functionality'"; and rejecting the concept of aesthetic
functionality where it is used as a substitute for "the more traditional source
identification principles of trademark law," such as the ornamentation andfunctionality doctrines).
Where the issue presented is whether the proposed mark is
ornamental in nature, it is improper to refer to "aesthetic functionality,"
because the doctrine of "functionality" is inapplicable to such cases. The
proper refusal is on the basis that the matter is ornamental and thus does not
function as a mark under §§1, 2 and 45 of the Trademark Act, 15 U.S.C. §§1051,
1052 and 1127. See
TMEP §§1202.03
et seq. regarding
ornamentation.
The Supreme Court's use of the term "aesthetic functionality" in
the TrafFix case appears limited to cases where the issue is one of
actual functionality, but where the nature of the proposed mark makes it
difficult to evaluate the functionality issue from a purely utilitarian
standpoint. This is the case with color marks and product features that
enhance the attractiveness of the product. The color or feature does not
normally give the product a truly utilitarian advantage (in terms of making the
product actually perform better), but may still be found to be functional
because it provides other real and significant competitive advantages and thus
should remain in the public domain.
For example, in Qualitex, supra, referred to as an
"aesthetic functionality" case in TrafFix, supra, the Supreme Court
considered whether a green-gold color used on the pads for dry cleaning presses
was barred from trademark protection under the functionality doctrine. While
the Court ultimately concluded that the color at issue was not functional, the
Court evaluated the proposed mark not only in light of the traditional
"utilitarian" definition of functionality (i.e., whether the proposed
mark is essential to the use or purpose of the product or affects the cost or
quality of the product), but also in terms of whether there was a competitive
need for the color in that industry, stating that the color would be considered
functional if its exclusive use "would put competitors at a significant
non-reputation-related disadvantage." Qualitex, 514 U.S. 165, 34 USPQ2d
at 1163-65. See also Brunswick Corp. v. British Seagull Ltd., 35 F.3d
1527, 32 USPQ2d 1120 (Fed. Cir. 1994) (affirming the Board's determination that
the color black for outboard motors was functional because while it had no
utilitarian effect on the mechanical working of the engines, it nevertheless
provided other identifiable competitive advantages - i.e., ease of
coordination with a variety of boat colors and reduction in the apparent size
of the engines).
In M-5 Steel Mfg., Inc. v. O'Hagin's Inc., 61 USPQ2d 1086
(TTAB 2001), the Board considered the proper use of the aesthetic functionality
doctrine in connection with product designs for metal ventilating ducts andvents for tile or concrete roofs:
This case seems to involve elements of both utilitarian andaesthetic functionality. Here, for example, there is evidence of utility in
applicant's patent application, as well as statements touting the superiority
of applicant's design in applicant's promotional literature, and statements
that applicant's design results in reduced costs of installation. On the other
hand, there is no question that applicant's roof designs which match the
appearance of surrounding roof tiles are more pleasing in appearance because
the venting tiles in each case are unobtrusive.
M-5 Steel, 61 USPQ2d at 1096. Citing extensively from the
TrafFix, Qualitex and Brunswick cases, the Board concluded
that the product designs were functional for a combination of utilitarian andaesthetic reasons:
[W]e agree with opposer that applicant's product designs are
functional in the sense that these configurations blend in or match the roof
tiles with which they are used better than alternative products. As in Brunswick,
these configurations do not make the roof vents work better because they are in
these shapes. Rather, like the advantages of color compatibility and reduction
in apparent engine size afforded by the color black, applicant's designs are
compatible with the roof tiles with which they are used and supply applicant
with a competitive advantage in each case. Because applicant's vents match the
contours of the roof vents with which they are used, alternatives will not have
this advantage. Applicant's patent application and other evidence of record,
including applicant's promotional literature and applicant's own testimony,
tout the designs' unobtrusive appearance, state that they are "functional in
design," camouflage the existence of the vents and are aesthetically pleasing.
Applicant also represents in its promotional material that its vents are
cheaper to install. We conclude that applicant's product designs are, as a
whole, functional, and that registration by applicant would hinder competition
by placing competitors at a substantial competitive disadvantage.
M-5 Steel, 61 USPQ2d at 1097.
Note that this type of functionality determination - while
employed in connection with a normally "aesthetic" feature such as color - is a
proper use of the functionality doctrine, necessitating a §2(e)(5) refusal
where the evidence establishes that a color or other matter at issue provides
identifiable competitive advantages and thus should remain in the public
domain. This is the opposite of an ornamentation refusal, where the matter at
issue serves no identifiable purpose other than that of pure decoration.
Generally speaking, examining attorneys should exercise caution
in the use of the term "aesthetic functionality," in light of the confusion
that historically has surrounded this issue. In most situations, reference to
aesthetic functionality will be unnecessary, since a determination that the
matter sought to be registered is purely ornamental in nature will result in an
ornamentation refusal under §§1, 2 and 45, and a determination that the matter
sought to be registered is functional will result in a functionality refusal
under §2(e)(5). Use of the term "aesthetic functionality" may be appropriate
in limited circumstances where the proposed mark presents issues similar to
those involved in the M-5 Steel and Brunswick cases, supra
- i.e., where the issue is one of true functionality under §2(e)(5), but
where the nature of the mark makes the functionality determination turn on
evidence of particular competitive advantages that are not necessarily
categorized as "utilitarian" in nature. Any such use of the term "aesthetic
functionality" should be closely tied to a discussion of specific competitive
advantages resulting from use of the proposed mark at issue, so that it is
clear that the refusal is properly based on the functionality doctrine and not
on an incorrect use of "aesthetic functionality" to mean ornamentation.
See
TMEP §§1202.05
and
1202.05(f)
for additional
discussion and case references regarding the functionality issue in connection
with color marks.
The examining attorney must establish a prima facie case
that the trade dress sought to be registered is functional. The burden
then shifts to the applicant to present sufficient evidence to rebut the
examining attorney's prima facie case of functionality. In re R.M.
Smith, Inc., 734 F.2d 1482, 222 USPQ 1, 3 (Fed. Cir. 1984); In re
Bio-Medicus Inc., 31 USPQ2d 1254, 1257 n.5 (TTAB 1993).
The functionality determination is a question of fact, and depends
on the totality of the evidence presented in each particular case. Valu
Engineering, Inc. v. Rexnord Corp., 278 F.3d 1268, 61 USPQ2d 1422 (Fed.
Cir. 2002); In re Caterpillar Inc., 43 USPQ2d 1335, 1339 (TTAB 1997).
While there is no set amount of evidence that an examining attorney must
present to establish a prima facie case of functionality, it is
clear that there must be evidentiary support for the refusal in the record. See,
e.g., In re Morton-Norwich Products, Inc., 671 F.2d 1332, 213 USPQ 9, 16-17
(C.C.P.A. 1982) (admonishing both the examining attorney and the Board for
failing to support the functionality determination with even "one iota of
evidence").
If the trade dress sought to be registered as a mark is the
subject of a utility patent that discloses the feature's utilitarian
advantages, then the applicant bears an especially "heavy burden of overcoming
the strong evidentiary inference of functionality." TrafFix Devices, Inc.
v. Marketing Displays, Inc., 532 U.S. 23, 58 USPQ2d 1001, 1005 (2001). See
TMEP §1202.02(a)(v).
Trade dress is functional if it is essential to the use or
purpose of a product or if it affects the cost or quality of the product. Inwood
Laboratories, Inc. v. Ives Laboratories, Inc., 456 U.S. 844, 850, 214 USPQ
1, 4 n. 10 (1982).
In TrafFix Devices, Inc. v. Marketing Displays, Inc., 532
U.S. 23, 58 USPQ2d 1001, 1005 (2001), the Supreme Court resolved a circuit
split regarding the proper weight to be afforded a utility patent in the
functionality determination, stating:
A utility patent is strong evidence that the features claimed
therein are functional. If trade dress protection is sought for those features
the strong evidence of functionality based on the previous patent adds great
weight to the statutory presumption that features are deemed functional until
proved otherwise by the party seeking trade dress protection. Where the
expired patent claimed the features in question, one who seeks to establish
trade dress protection must carry the heavy burden of showing that the feature
is not functional, for instance by showing that it is merely an ornamental,
incidental, or arbitrary aspect of the device.
See also In re Bose Corp., 772 F.2d 866, 227 USPQ 1 (Fed.
Cir. 1985); In re Visual Communications Co., Inc., 51 USPQ2d 1141 (TTAB
1999); In re Edward Ski Products, Inc., 49 USPQ2d 2001 (TTAB 1999); In
re Caterpillar Inc., 43 USPQ2d 1335 (TTAB 1997).
The Court in TrafFix went on to hold that where the
evidence includes a utility patent that claims the product features at issue,
it is unnecessary to consider evidence relating to the availability of
alternative designs:
There is no need, furthermore, to engage, as did the Court of
Appeals, in speculation about other design possibilities, such as using three
or four springs which might serve the same purpose. Here, the functionality of
the spring design means that competitors need not explore whether other spring
juxtapositions might be used. The dual-spring design is not an arbitrary
flourish in the configuration of MDI's product; it is the reason the device
works. Other designs need not be attempted.
TrafFix, 532 U.S. at 23, 58 USPQ2d at 1007 (citation
omitted).
Therefore, in those instances where the examining attorney is
presented with facts similar to those in TrafFix - i.e., where
there is a utility patent establishing the utilitarian nature of the product
design at issue - the examining attorney may properly issue a final
functionality refusal based primarily on the utility patent.
In relevant cases, the examining attorney should ask the
applicant to provide copies of any patent(s) or any pending or abandoned patent
application(s). See Valu Engineering, Inc. v. Rexnord Corp., 278 F.3d
1268, 61 USPQ2d 1422, 1429 (Fed. Cir. 2002) ("We agree with the Board that an
abandoned patent application should be considered under the first
Morton-Norwich factor, because an applied-for utility patent that never issued
has evidentiary significance for the statements and claims made in the patent
application concerning the utilitarian advantages, just as an issued patent has
evidentiary significance.").
It is important to read the patent to determine whether the
patent actually claims the features presented in the proposed mark. If it does
not, or if the features are referenced in the patent, but only as arbitrary or
incidental features, then the probative value of the patent as evidence of
functionality is substantially diminished or negated entirely. TrafFix,
532 U.S. at 34, 58 USPQ2d at 1007 (where a manufacturer seeks to protect
arbitrary, incidental or ornamental aspects or features of a product found in
the patent claims, such as arbitrary curves in the legs or an ornamental
pattern painted on the springs, functionality will not be established if the
manufacturer can prove that those aspects do not serve a purpose within the
terms of utility patent); see also Black & Decker Inc. v. Hoover
Service Ctr., 886 F.2d 1285, 12 USPQ2d 1250 (Fed. Cir. 1989); In re
Zippo Mfg. Co., 50 USPQ2d 1852 (TTAB 1999); In re Weber-Stephen Products
Co., 3 USPQ2d 1659 (TTAB 1987).
It is not necessary that the utility patent be owned by the
applicant; a third-party utility patent is also relevant to the functionality
determination if the patent claims the features in the product design sought to
be registered. See In re Virshup, 42 USPQ2d 1403 (TTAB 1997); In re
American National Can Co., 41 USPQ2d 1841 (TTAB 1997); In re Cabot Corp.,
15 USPQ2d 1224 (TTAB 1990). Therefore, the examining attorney may also search
the Office's patent records to see if there are utility patents owned by third
parties that disclose the functional advantages of the product design that the
applicant seeks to register.
Statements regarding utilitarian advantages of the design made in
the course of the prosecution of the patent application can be very strong
evidence of functionality. TrafFix, 532 U.S. at 32, 58 USPQ2d at 1006
("These statements [regarding specific functional advantages of the product
design] made in the patent applications and in the course of procuring the
patents demonstrate the functionality of the design. MDI does not assert that
any of these representations are mistaken or inaccurate, and this is further
strong evidence of the functionality of the dual-spring design.").
Where a utility patent claims more than what is sought to be
registered, this fact does not establish the nonfunctionality of the product
design if the patent shows that the part claimed as a trademark is an essential
or integral part of the invention and has utilitarian advantages. Cf.
TrafFix, 532 U.S. at 31, 58 USPQ2d at 1006.
The fact that the proposed mark is not the subject of a
utility patent does not establish that the product feature is nonfunctional. TrafFix,
532 U.S. at 31, 58 USPQ2d at 1006; In re Gibson Guitar Corp., 61 USPQ2d
1948, 1950 n. 3, (TTAB 2001). If the patent does not disclose utilitarian
advantages of the design features at issue, or if no utility patent/application
is of record, the evidence normally involves consideration of one or more of
the other factors commonly known as the "Morton-Norwich factors:"
(1) the existence of a utility patent that discloses the
utilitarian advantages of the design sought to be registered;
(2) advertising by the applicant that touts the utilitarian
advantages of the design;
(3) facts pertaining to the availability of alternative
designs; and
(4) facts pertaining to whether the design results from a
comparatively simple or inexpensive method of manufacture.
In re Morton-Norwich Products, Inc., 671 F.2d 1332, 213
USPQ 9, 15-16 (C.C.P.A. 1982).
Moreover, even in the absence of a utility patent or utility
patent application, it is not necessary to consider all these factors in every
case. The Supreme Court held that "[w]here the design is functional under the Inwood
formulation there is no need to proceed further to consider if there is a
competitive necessity for the feature." TrafFix Devices, Inc. v. Marketing
Displays, Inc., 532 U.S. 23, 58 USPQ2d 1001, 1006 (2001). See also
Gibson Guitar Corp., supra (where there was no utility patent, and no
evidence that applicant's guitar configuration resulted from a simpler or
cheaper method of manufacture, these factors did not weigh in Board's
decision).
Relevant technical information is usually more readily available
to an applicant. In re Witco Corp., 14 USPQ2d 1557, 1560 (TTAB 1990).
Therefore, the applicant will often be the source of most of the evidence
relied upon by the examining attorney in establishing a prima facie case
of functionality in an ex parte case. In re Teledyne Industries Inc.,
696 F.2d 968, 971, 217 USPQ 9, 11 (Fed. Cir. 1982). When there is reason to
believe the proposed mark may be functional, in the first Office action the examining
attorney should require the applicant to provide information necessary to
permit an informed determination concerning the registrability of the proposed
mark. See 37 C.F.R. §2.61(b); In re Babies Beat Inc., 13 USPQ2d
1729, 1731 (TTAB 1990) (registration properly refused where applicant failed to
comply with examining attorney's request for copies of patent applications andother patent information). In addition to asking whether the proposed mark is
or has been the subject of a utility patent or a pending or abandoned patent
application, the examining attorney should require an applicant to provide
advertising or promotional materials. The examining attorney should also
inquire whether the feature makes the product easier or cheaper to manufacture andwhether alternative designs are available.
It is important that the inquiry focus on the utility of the
feature or combination of features that is claimed as protectible trade dress,
and not on the usefulness of the article overall. Morton-Norwich, 671
F.2d at 1338, 213 USPQ at 13. Generally, dissecting the design into its
individual features and analyzing the utility of each separate feature does not
establish that the overall design is functional. 15 U.S.C. §1052(e)(5); Teledyne
Industries Inc., 696 F.2d at 971, 217 USPQ at 11. However, it is sometimes
helpful to analyze the design from the standpoint of its various features. In
re R.M. Smith, Inc., 734 F.2d 1482, 1484, 222 USPQ 1, 2 (Fed. Cir. 1984)
(affirming the functionality determination, where the Board had initially
considered the six individual features of the design, and then had concluded
that the design as a whole was functional); In re Controls Corp. of America,
46 USPQ2d 1308, 1312 (TTAB 1998) (finding the entire configuration at issue functional
because it consisted of several individual features, each of which was
functional in nature). See also Elmer v. ICC Fabricating Inc., 67 F.3d
1571, 1579-80, 36 USPQ2d 1417, 1422-23 (Fed. Cir. 1995) (rejecting the argument
that the combination of individually functional features in the configuration
resulted in an overall nonfunctional product design).
Where the evidence shows that the overall design is functional,
the inclusion of a few arbitrary or otherwise nonfunctional features in the
design will not change the result. See Textron, Inc. v. U.S. International
Trade Commission, 753 F.2d 1019, 224 USPQ 625, 628-29 (Fed. Cir. 1985); In
re Vico Products Mfg. Co., Inc., 229 USPQ 364, 368 (TTAB 1985).
A design patent is a factor that weighs against a finding of
functionality because design patents by definition protect only ornamental andnonfunctional features. However, ownership of a design patent does not in
itself establish that a product feature is nonfunctional, and can be outweighed
by other evidence supporting the functionality determination. R.M. Smith,
Inc., 734 F.2d at 1485, 222 USPQ at 3; American National Can Co., 41
USPQ2d at 1843; Caterpillar Inc., 43 USPQ2d at 1339; Witco Corp.,
14 USPQ2d at 1559.
The examining attorney should examine the specimens of record,
and should also ask an applicant to provide any available advertising,
promotional or explanatory material concerning the goods/services, particularly
any material specifically related to the features embodied in the proposed
mark. The examining attorney should also check to see if the applicant has a
website on which the product is advertised or described.
The applicant's own advertising touting the utilitarian aspects
of its design is often strong evidence supporting a functionality refusal. See,
e.g., In re Gibson Guitar Corp., 61 USPQ2d 1948 (TTAB 2001); M-5 Steel
Mfg., Inc. v. O'Hagin's Inc., 61 USPQ2d 1086 (TTAB 2001); In re Visual
Communications Co., Inc., 51 USPQ2d 1141 (TTAB 1999); In re Edward Ski
Products, Inc., 49 USPQ2d 2001 (TTAB 1999); In re Caterpillar Inc., 43
USPQ2d 1335 (TTAB 1997); In re Bio-Medicus Inc., 31 USPQ2d 1254 (TTAB
1993); In re Wi
