Category Archives: Trademarks

USPTO Seeks Comments on Potential Trademark Misuse

by Christina Frangiosa


The US Patent and Trademark Office (USPTO) has posted a request for public comment “regarding their experiences with litigation tactics, especially those involving an attempt to enforce trademark rights beyond a reasonable interpretation of the scope of the rights granted to the trademark owner. The USPTO also is eliciting suggestions to address any allegedly problematic litigation tactics.” Comments are due by January 7, 2011 and the details of what to address in the comments can be found in the USPTO’s request.

This study is mandated by the Trademark Technical and Conforming Amendment Act of 2010 (see below).

Statutory Background

The Trademark Technical and Conforming Amendment Act of 2010 (Pub. L. No. 111-146) was signed into law on March 17, 2010, and generally addresses technical amendments to the Trademark Act. However, buried at the end of the law (initially proposed as HR 4515 and S 2968), is a provision requiring that the Secretary of Commerce should undertake a study to determine:

  1. “the extent to which small businesses may be harmed by litigation tactics by corporations attempting to enforce trademark rights beyond a reasonable interpretation of the scope of the rights granted to the trademark owner;” and
  2. “the best use of Federal Government services to protect trademarks and prevent counterfeiting.”

Pub. L. No. 111-146 § 4(a). The study is due within one year after the enactment of the Bill – thus placing the deadline no later than March 17, 2011.

During the debates in the Senate in early March, both Senators Coble and Johnson conceded that Section 4 (where this “study” language appears) needed work, but that the remainder of the Bill was so important that it should pass without amendment to avoid the delay of returning an amended Bill to the House for approval. (For background on legislative procedure and how Bills get enacted, see What Does the House Do? and How Does a Senate Bill Become Law?.)

Senators Coble and Johnson also explained that Senator Leahy (who had proposed S. 2968) had agreed to “improve the language” in a subsequent bill.

SEN. JOHNSON:  “However, the bill is not perfect. It includes a study provision regarding alleged trademark lawsuit abuse and small businesses. While we don’t want to delay the necessary relief to the trademark owner that this bill will provide by immediate passage of S. 2968, the ranking member and I are committed to working with Senator Leahy to refine the text of this study provision at our soonest opportunity.” 111 Cong. Rec. at H1081 (Mar. 3, 2010).

SEN. COBLE: “[T]he legislation includes a study provision that was inserted at the behest of the other body. It directs the Intellectual Property Enforcement Coordinator and the Department of Commerce to evaluate and report on treatment of smaller businesses involved in litigation. Along with Chairman Conyers and the chairman of the subcommittee, the distinguished gentleman from Georgia, I believe the study text could be clarified further.  I’m happy to report that Senator Leahy has agreed to work with us on making the necessary minor revisions to improve the language.  We intend to move this language at a later date on a different vehicle.  We just don’t want to delay further consideration of S. 2968 by requiring the other body to pass the bill for a second time.”  111 Cong. Rec. at H1081 (Mar. 3, 2010).

Indeed, Senator Leahy introduced an amendment contained within a separate bill, the “Copyright Cleanup, Clarification and Corrections Act of 2010” (S. 3689, proposed on August 2, 2010). This Bill passed the Senate and was referred to the House Budget Committee and the House Judiciary Committee before Congress when on recess. This Bill changes the focuses to “the extent to which small businesses may be harmed by litigation tactics by corporations attempting the purpose of which is to enforce trademark rights beyond a reasonable interpretation of the scope of the rights granted to the trademark owner.” (Former language crossed out; new language in bold and italics).

While the Congress may return from its current recess after the elections in order to pass a budget or appropriations measure, this Bill may not progress further before the end of the Congressional term. If that is the case, then it would need to be re-proposed in January before it can be adopted.

Comments Requested by the USPTO

In the meantime, in the absence of “improved language,” the Department of Commerce (and in particular, the USPTO) is now undertaking this study and has requested public comment, due by January 7, 2011. In particular, the USPTO has requested comment about the following topics:

. . . Although the USPTO would find it most beneficial to receive responses to every item, you may answer all or any portion of the following questions.

1.  Please identify whether you are a trademark owner or practitioner, and the general size and nature of your business or trademark practice, including the number of trademark applications and registrations your business has, or your practice handles.  Please note that the USPTO will fully consider any comments you submit, even if you choose not to identify yourself in a particular manner.

2.  In approximately the last 5 years, please describe any instances of which you have first-hand knowledge where a small business may have been the target of litigation tactics attempting to enforce trademark rights beyond a reasonable interpretation of the scope of the rights granted to the trademark owner.
3.  Please describe situations where you have been involved in receiving a cease-and-desist letter.  Anecdotal information might include, but is not limited to, a description of whether the letter resulted in the small business ceasing its use of one or more marks, or whether the sender of the cease-and-desist letter withdrew or abandoned its demands against the small business owner.

4.  Please describe situations where you have been involved in trademark litigation in state or federal courts.   Anecdotal information might include, but is not limited to, a description of whether the lawsuit settled on the basis of the small business agreeing to cease its use of one or more marks, or on the basis of the plaintiff withdrawing or abandoning its trademark-related allegation(s).  Alternatively, relevant information might include whether such lawsuits resulted in a court judgment and the nature of the judgment (such as requiring the small business to cease its use of one or more marks, assessing monetary liability (damages, lost profits, or attorneys’ fees) against the small business, requiring the plaintiff to pay the defendant’s attorneys’ fees, or imposing sanctions against the plaintiff under Rule 11 of the Federal Rules of Civil Procedure).

5.  Please describe situations where you have been involved in opposition/cancellation proceedings instituted at the USPTO against small business owners.  Anecdotal information might include, but is not limited to, a description of whether the proceedings settled on the basis of the small business agreeing to abandon its application(s) for one or more marks, or whether the proceedings settled on the basis of the plaintiff withdrawing or abandoning its notice of opposition or cancellation petition.  Alternatively, relevant information might include a description of whether such proceedings resulted in a decision by the USPTO Trademark Trial and Appeal Board (“TTAB”) refusing to register/canceling one or more marks owned by the small business, or whether such proceedings resulted in the TTAB imposing sanctions against the plaintiff under Rule 11 of the Federal Rules of Civil Procedure.

6.  Do you think trademark “bullies”[1] are currently a problem for trademark owners, and if so, how significant is the problem?

7.  Do you think aggressive litigation tactics are more pervasive in the trademark area than in other areas of the law?

8.  Do you think the USPTO has a responsibility to do something to discourage or prevent trademark bullying?   If yes, what should the USPTO do?

9.  Do you think the U.S. courts have a responsibility to do something to discourage trademark bullies?  If yes, what should the U.S. courts do?

10.  What other U.S. agencies may have a responsibility to do something about the problem?

11.  Do you think Congress has a responsibility to do something to discourage or prevent trademark bullying?   If yes, what should Congress do?

12.  Please provide any other comments you may have.

*****
[1] A trademark “bully” could be described as a trademark owner that uses its trademark rights to harass and intimidate another business beyond what the law might be reasonably interpreted to allow.

Note that this study still contemplates a focus on small businesses and promises to examine whether they are disproportionately affected by trademark owners’ enforcement activities. If the USPTO posts any of the comments it receives, I’ll try to post updates here for anything of particular interest.

Have We Lawyers Genericized “Bates” Numbers?

by Christina Frangiosa


We lawyers are enamored with the phrase “Bates numbers” – however, even if “enamored” is too exaggerated, you must agree that lawyers use that phrase a lot, especially when talking about documents produced during litigation. It generally refers to the sequential numbering applied to documents exchanged between parties during a lawsuit. See generally, “Bates numbering” on Wikipedia; see also Masters, “Acrobat, The Solo and Small Firm Litigation Tool,” ABA’s GP Solo Magazine, June 2010, ¶¶ 10-13.

So, if one party produces documents to another during litigation, every page of those documents probably bears a unique, sequential number to enable consistent and uniform identification of a particular document referenced during the lawsuit. For instance, if Defendant produces a five-page memo bearing a 2005 date, the lawyers for both parties would argue about whether it should be characterized as the “2005 memo” or the “2005 admission that Defendant was negligent.” A far less argumentative way to identify that document accurately is by its sequential page number (a.k.a. the “Bates” number). Thus, both parties can agree that the document is D1234-D1239 and then move on to their substantive arguments.

How did these page numbers start being referred to as “Bates” numbers – and why do lawyers still call them that? I don’t claim to have all of the answers on this point, but after some digging, here’s what I’ve found:

In the late 1890s, the US Patent Office issued several patents to an individual inventor who later assigned them to the Bates Manufacturing Company for various devices that enabled the sequential numbering of paper. For example, you can find the following patent files through the U.S. Patent & Trademark Office:

  • U.S. Patent No. 484,389 for a consecutive-numbering machine, issued in 1892 to Edwin G. Bates
  • U.S. Patent No. 676,084 for an automatic numbering machine, issued in 1900 to Edwin G. Bates
  • U.S. Patent No. 676,082 for an automatic numbering machine, issued in 1901 to Edwin G. Bates

Note however, that some more recent patents refer to methods of assigning “Bates numbers” in a specific way and were issued to others:

  • U.S. Patent No. 5,960,448 issued in 1999 and assigned to Legal Video Services Inc.
  • U.S. Patent No. 7,103,602 issued in 2006 and assigned to Kroll Ontrack

Even though the patents have long since expired (patents are not valid forever), the trademarks remain valid, at least in connection with numbering machines.

The Bates Manufacturing Company also applied for – and was issued – registration of its trademark BATES (stylized) claiming a date of first use since 1891 for “numbering machines” in Class 09 (Reg. No. 158,174, renewed in 2002) and in Class 07 (Reg. No. 269,975, renewed in 2010). In fact, you can order one of these devices, which still bears this trademark, from sites like Amazon.com. (Note that Class 09 is also the class in which marks associated with software programs tend to be registered.) The company also owned trademark registrations in BATES for other products like ink pads and stapling supplies.

However, it appears that these trademarks may be of limited value because in undertaking the research for this article, I found many sites marketing software versions of “bates numbering” programs (e.g., http://www.bates-stamp.com/), or offering to sell their services to manage the “bates numbering” process for litigants (e.g., http://lsilegal.com/web/Solutions/TraditionalSvcs.aspx). It appears that the mark “Bates” as applied to automatic numbering systems may have become generic for a system of automatically applying sequential numbers to documents.

In this case, the trademark owner consistently applied its graphic label (which seems to be branded onto a metal plate) to the stampers themselves, by affixing it mechanically. Even today, the stampers seem to bear this label. (See e.g., the image of a stamping machine bearing the mark – click on “specimen” after reaching the Case File – as submitted to the U.S. Trademark Office in 2010 in support of an affidavit of continuing use). But, it apparently did not protect the mark (or the mark has lost its trademark value) in connection with sequential numbering systems or services to apply these types of numbers to documents, either in hard-copy or electronic form.

The lesson to be drawn from this – when you create a unique name for a product (or service) and begin to use it in commerce in connection with that product (or service), plan ahead for the possibility that the technology in which you began using the mark will evolve into something new. At the very least, recognize that as your industry matures, your trademarks may change, even if the products or services themselves remain the same as they were when they were first introduced. While it may be wonderful when your brand name becomes a household (or lawfirm-wide) word, mark owners need to police the use of their marks to keep the their value from being undermined.

Being vigilant means a mark can last forever. History is replete with examples of brand names that were not protected adequately by their owners and now are generic to identify products of that type. For example, Bayer failed to protect the name “aspirin” in the U.S., so anyone can use the mark “aspirin” in connection with their own brand of that medication in the U.S. without violating Bayer’s trademark rights. Bayer has successfully protected “ASPIRIN” worldwide (e.g., Canada, Reg. No. NFLD761, where the mark was registered in 1919) and it remains the exclusive property of Bayer.

Top 10 Ways to Preserve Your Trademarks

by Christina Frangiosa

On Friday (April 16), during the Pennsylvania Bar Institute‘s Fourth Annual IP Institute, I delivered a presentation on Top 10 Ways to Preserve Your Trademark, co-presented with Rex A. Donnelly of RatnerPrestia in its Wilmington, DE office.

I will be uploading both the article and PowerPoint presentation that we co-developed to my firm’s web site as quickly as feasible, and you are welcome to review them there. In sum, however, the topics we covered were:

  1. Choose a Mark You Can Protect
  2. Register Your Mark
  3. Be Truthful with the Trademark Office
  4. Keep Using Your Mark
  5. Maintain Your Registration
  6. Update Your Protection
  7. Use Your Mark Correctly
  8. Make Sure Others Use Your Mark Correctly
  9. Police for Infringement and Dilution
  10. License Your Mark Wisely

(I had responsibility for topics 3,4,5,7 and 9 – and wrote the sections for topics 3,4,6,7 and 9 in the article (Mr. Donnelly and I swapped topics 5 and 6 the morning of our presentation)). I also attended many of the presentations by my colleagues, and was particularly impressed with the “Mock” hearings (Mock Markman Hearing, Mock Preliminary Injunction Argument, Mock TTAB Cancellation Hearing), which were all presided over by judges currently sitting on the bench. I hope the course planners expand those sessions to additional topics next year.

I welcome your comments.

UPDATE on 5/7/10: The published article and the accompanying slides are now available on my firm’s web site. The direct links are here: “Top 10 Ways to Preserve Your Trademark,” Pennsylvania Bar Institute’s Fourth Annual IP Institute (April 16, 2010), co-written with Rex A. Donnelly of RatnerPrestia – (with presentation slides).

Fraud on the PTO – A Trademark Perspective

by Christina Frangiosa

Last Friday (April 9), during the American Bar Association Intellectual Property Law Section conference, I delivered a presentation on Trademark Prosecution Ethics, and in particular, the history and current status of the fraud in the procurement theory used to cancel registrations (or oppose applications) when material misrepresentations have been made to the Patent & Trademark Office during the application or renewal process.

I plan to upload both my article and my PowerPoint presentation to my firm’s web site as quickly as feasible, and you are welcome to review them there. In sum, however, my conclusions were as follows:

“While the test for determining that an applicant’s or registrant’s conduct in filing an application or maintaining trademark registrations was fraudulent has become more stringent, applicants, registrants and their counsel still face some pitfalls in the process. Indeed, although certain amendments of an inaccurate filing may be accepted (provided that no challenge to the validity of the application or registration has yet been filed), it is clear that both the TTAB and the Federal Circuit discourage carelessness in preparing these filings.

Accordingly, applicants and registrants are strongly encouraged to do at least the following to avoid increasing the risk of claims or counterclaims of fraud on the USPTO, and thus, loss of a pending application or a particular registration:

  • Conduct appropriate due diligence to ensure that the marks sought to be registered (or renewed) qualify as “in use” or validly subject to the “intent to use” process;
  • Ensure that the intended signatory for the declaration has the appropriate level of personal knowledge to support the allegations of use or intent to use, exclusive right to use the mark and other averments of fact;
  • Ensure that any licensees upon whose use the applicant/registrant will rely to maintain the registration properly use the mark in commerce and provide sufficient evidence to the applicant/registrant to support the maintenance filing; and
  • Undertake proper due diligence before filing an Opposition or Cancellation proceeding to ensure that the trademark or service mark forming the basis of a challenge to another application or registration does not have any exposure to a counterclaim for fraud on the USPTO and thus at risk for cancellation during the pendency of the proceeding.

Note that undertaking these preparations cannot completely moot claims of fraud on the USPTO, but they lend support and reasonableness to a potential response that no “intent to deceive” can be demonstrated by clear and convincing evidence. Finally, this entire line of cases confirms that the USPTO, TTAB and Federal Circuit Court of Appeals have strong interests in ensuring that the trademark Register be kept current and accurate, and demonstrates a disfavor of carelessly filed and unreliable factual statements about the use or non-use of trademarks and services marks in active use in U.S. commerce.

I welcome your comments.

UPDATE on 4/20/10: The slides from the presentation can be found on the ABA’s IPL Section site.

UPDATE on 5/7/10: The published article and the accompanying slides are now available on my firm’s web site. The direct links are here: “Ethics in Trademark Application Prosecution: Alleging ‘Fraud in the PTO’ After In re Bose,” ABA Intellectual Property Law Section 25th Annual Conference (April 9, 2010) – (with presentation slides).

SDNY Orders TAVERN ON THE GREEN Service Mark Cancelled for Fraud

by Christina Frangiosa

In a recent decision, the United States District Court for the Southern District of New York granted the City of New York’s motion for summary judgment, thus cancelling the City’s former licensee’s service mark registration for the mark TAVERN ON THE GREEN in connection with restaurant services on the ground that the registration was fraudulently procured. City of New York v. Tavern on the Green, L.P. et al., Nos. 09 Civ. 9224, 09 Civ. 9254, slip op. at 3 (S.D.N.Y. Mar. 10, 2010) (ECF Document No. 40). Access to a valid PACER account may be required to access the court filings cited in this blog entry. Alternatively, see Justia’s docket report – sometimes they make public filings available on their site.

Case Background

In 1934, the City of New York opened a restaurant in Central Park called “Tavern on the Green” and hired various vendors over time to run the restaurant pursuant to operating agreements. Id. at 4. The restaurant closed periodically for renovation and “improvements,” and the City paid substantial portions of the renovation costs. Id. For instance, in 1956, the restaurant closed for a $400,000 renovation project, which enabled the restaurant to expand its inside seating capacity from 300 to 720 and for which the City covered approximately 80% of the cost. Id.

In 1973, the City entered into a license agreement with Warner LeRoy (and thereafter Tavern on the Green, L.P. to whom LeRoy’s interest in the agreement was transferred) to operate “Tavern on the Green” as a restaurant and cabaret. Id. at 5. Several key terms in this first license agreement between these parties were: 1) the licensee’s ability to change the name of the restaurant upon written approval from the City’s representative; 2) the City’s ability to approve (or reject) any manager that the licensee hired to run the restaurant; 3) the requirement that the licensee hire “a sufficient number of trained attendants” (presumably waiters/servers) and 4) the requirement for the attendants to wear “a City-approved uniform.” Id. at 5-6. The parties also agreed that certain renovations were to be completed before the defendant could open the restaurant for business. Id. at 5. The agreement was renewed in 1976 and the restaurant re-opened for business 1978. Id. & n.2.

In 1985, the parties re-negotiated the terms of their agreement to add the following new provisions: 1) that the City could regulate the times and manner of operation; 2) that the City could inspect the facility at any time; 3) that City approval was required for all signs and solicitations for business; and 4) that the food served by LeRoy would be “pure and of good quality.” Id. at 7. Removed from this revised agreement was LeRoy’s ability to change the name of the restaurant, even if he obtained written approval from the City. Id. at 6. After this agreement was executed, the City exercised its rights to govern the hours of operation and the types of events the occurred on the premises several times. Id. at 7.

LeRoy’s Service Mark Application

In 1978, LeRoy filed a trademark application for the mark TAVERN ON THE GREEN in connection with restaurant services on behalf of a joint venture that had been formed to operate the restaurant (“the joint venture”) and claimed a date of first use of August 31, 1976, which corresponded to the date on which the restaurant was re-opened after the 1973 renovations were completed. Id. As part of his application package, he signed a declaration that confirmed that the joint venture had the right to use this mark and “to the best of his knowledge and belief, no other person, firm, corporation or association has the right to use said mark in commerce, either in the identical form or in such near resemblance thereto as to be likely . . . to cause confusion, to cause mistake, or to deceive. . . .” Id. at 8. However, LeRoy did not disclose the 1973 agreement to the USPTO, nor did he inform the City of New York that he had applied for registration of this mark. Id. The application was ultimately approved and registered in 1981 (Reg. No. 1,154,270) without a single opposition. Id.

In 1986, the joint venture filed a Section 15 affidavit, claiming incontestability of the mark based on continued use throughout the preceding five years. The USPTO acknowledged that the affidavit had been filed, and the record was updated to reflect the joint venture’s claim of incontestability pursuant to 15 U.S.C. § 1065. (Once a registrant can demonstrate incontestability of its mark, third parties will be limited in the grounds that they can allege in a petition to cancel the registration.) The City apparently did not become aware of the registration until 2006, and immediately thereafter requested that LeRoy and the joint venture assign all rights in the mark to the City. Id. at 8. LeRoy declined.

In 2007, the joint venture filed a second application for registration of the mark TAVERN ON THE GREEN in connection with “cooking oils, salad dressings and dipping oils.” Although the City requested two extensions of time to oppose this application, registration ultimately issued in September 2008 unopposed (Reg. No. 3,494,658).

The Dispute at Bar

Neither LeRoy nor his estate is individually named as a defendant in this case, but both of his companies are. (Mr. LeRoy apparently passed away in 2001, but his rights in the mark passed to the companies.) The companies (collectively referred to as “Debtors”) sought protection of the bankruptcy court under Section 11 in September 2009, and thereafter initiated an adversary proceeding to obtain a declaration of their exclusive right to use the mark for restaurant services, and to prevent the City from using the name for itself. Id. at 10. In November 2009, the City filed a motion to withdraw the bankruptcy reference, which motion the U.S. District Court for the Southern District of New York granted on December 3, 2009. (ECF Document No. 9).

Both parties filed cross motions for summary judgment. The Debtors sought a declaration that they had the exclusive right to use the mark in connection with restaurant services, and an injunction against the City’s continued use of the mark in commerce. City of New York v. Tavern on the Green, L.P. et al., Nos. 09 Civ. 9224, 09 Civ. 9254, slip op. at 3 (ECF Document No. 40). For its part, the City’s motion for summary judgment sought: 1) a declaration of its prior rights in the mark under New York state law; 2) cancellation of Debtors’ registration based on a “fraud in the procurement” theory; and 3) cancellation of the Debtors’ registration for use of the mark in connection with the various oils. Id.

Cancellation of LeRoy’s Registration in TAVERN ON THE GREEN (Restaurant Services)

Ultimately, the Court granted the City’s motion for summary judgment with respect to the TAVERN ON THE GREEN registration in connection with restaurant services, and ordered that the registration be cancelled based on LeRoy’s commission of fraud in procuring the registration without disclosing the City’s prior rights or the limitations on LeRoy’s own rights as a result of the license agreement. As to the second registration, in connection with various oils, the Court concluded that evidence was not presented sufficient to justify cancellation of this registration, and determined that the motion for summary judgment on this point was “premature.”

In reaching its decision, the Court evaluated the City’s claim of a prior right to the mark TAVERN ON THE GREEN in connection with restaurant services based on New York common law of unfair competition. It explained that “in order to establish a protectable right to a trade name under New York law, the City must proffer undisputed facts that show that the defendants are unfairly attempting to exploit the efforts of another to create goodwill in that trade name.” Id. at 11. The Court concluded that the City indeed had prior rights – predating those of the registrant by 35 years – such that the mark, “‘Tavern on the Green’ was closely associated in the public mind with a building owned by the City and located in New York’s Central Park.” Id. at 13, 14.

The Debtors argued that the repeated closures of the facility for renovation and improvement – particularly the closure in 1973 that coincided with the awarding of the concession lease to LeRoy – constituted a break in the City’s use of the mark, such that it should not be able to claim continuous use since 1934. Id. at 15. The Court disagreed, noting that “[r]enovations usually signify an intention to continue operations, which the 1973 Agreement makes clear by contemplating renovations in the transition from the prior licensee to the Debtors.” Id. Thus, the Debtor’s claim to “incontestibilty” as a result of its 1985 filing with the USPTO was not valid as against the City – because of the City’s prior rights. Id. at 16.

The Court also considered the City’s claim that LeRoy had procured the registration fraudulently when he applied in 1978 for registration of the service mark. After finding that the failure to disclose the license agreement demonstrating that LeRoy’s rights in the mark were limited was a material fact, the Court concluded that “the deliberate omission in a trademark application of information regarding another’s right to use the mark applied for is a material omission justifying cancellation of the mark.” Important to the Court’s consideration was its expectation that trademark applicants owed “uncompromising candor” to the USTPO when they file their applications. Id.

Court’s Dismissal of Debtor’s Laches Defense

In addition to denying the City’s claim for prior rights in the trademark, the Debtors raised a defense of laches, claiming that the City had waited too long to file its claim for cancellation. In dismissing the Debtor’s argument rather summarily, the Court confirmed that the Lanham Act clearly provided for cancellation at any time when the claimant can demonstrate fraudulent procurement. Id. at 20; see 15 U.S.C. § 1064.

Impact on Other Decisions

This opinion serves as a reminder that the declarations required to be signed in connection with trademark applications need to be reviewed carefully before applicants sign them. Not only must an applicant confirm that the descriptions of goods or services associated with the application are accurate (see Medinol and Bose lines of cases, covered in prior blog entries here), but also must confirm that no one else has the right to use the mark in connection with the goods or services identified in the application. Failure to read carefully and affirm the accuracy of the statements made in the application can result in a loss of registration or in a determination that another entity has more senior rights that may override any investment (no matter how significant) the applicant has made in the mark.