All TTAB practitioners are familiar with the heightened standard of proof required to prove fraud before the USPTO.  However, many forget that proving an intent to deceive the USPTO, not the falsity of the statement or its materiality, is the lynchpin of every fraud claim.  In a recent decision, the TTAB reminded practitioners of this critical fact.

Petitioner Jason Green commenced a cancellation proceeding against a registration for the mark OMNI BIOTIC for food supplements, claiming priority and likelihood of confusion with his common law mark OMNIBIOTICS for supplements.  Green also asserted a fraud claim against Respondent based on Green’s allegation that Respondent did not have a bona fide intent to use the OMNI BIOTIC mark when it filed its Section 66(a) application that matured into the subject registration.

The TTAB dismissed Green’s likelihood of confusion claim finding that he failed to show, by a preponderance of the evidence, that he used his OMNIBIOTICS mark in the United States before Respondent used its OMNI BIOTIC mark in the United States.  The TTAB further ruled that, although minimal, Respondent’s sales in the United States were sufficient to establish priority.

The TTAB similarly found Green’s fraud claim deficient.  To show fraud, Green needed to prove that (1) Respondent made a false representation to the USPTO, (2) the false representation was material to the registrability of the subject mark, (3) Respondent had knowledge of the falsity of the representation, and (4) Respondent made the representation with intent to deceive the USPTO.  Decision, at p. 40.

Green alleged that Respondent had perpetrated a fraud on the USPTO because it introduced “no documentary evidence to show any intention of [sic] plans for using its mark in the United States at the time of filing the OMNI BIOTIC mark.”  Id., at p. 41.  The TTAB discounted this argument, noting, at the outset, that it did not need to decide whether Respondent had a bona fide intent because “that is not the claim before us.”  To the contrary, Green asserted fraud.  Accordingly, the TTAB held, “[E]ven if Respondent materially misrepresented to the USPTO that it had a bona fide intention to use the mark in commerce, Petitioner must show that the false representation was made with a ‘knowing intent to deceive.’”  Id., at p. 42 (emphasis added).

The TTAB dismissed Green’s fraud claim, finding he made no effort to establish that Respondent had a “knowing intent to deceive.”  Id.  Instead, he simply assumed the existence of such intent based on the fact that Respondent purportedly made “knowingly false material representations of fact.”  Id.  The TTAB concluded: “Absent proof of the requisite intent to mislead the PTO, ‘even a material misrepresentation would not qualify as fraud under the Lanham Act.’” Id. at p. 43.

Takeaway:  Proof of a knowingly false material representation of fact is not enough to prove fraud; petitioner must present sufficient evidence to establish that respondent made the knowing and false representation for the express purpose of deceiving the USPTO.

The decision is Jason Green v. Institut Allergosan Pharmazeutische Produkte Forschungs-und Vertriebs GmbH, Cancellation No. 92069600 (TTAB Sept. 1, 2021) (non-precedential).

In a recent precedential decision, the Trademark Trial and Appeal Board (“TTAB”) cautioned practitioners to be careful what they ask for and to draft their filings accordingly.

On September 8, 2021, the TTAB denied Applicant Grüne Erde Beteiligungs GmbH’s (“Grüne Erde”) motion for relief from judgment following its express abandonment of its opposed multi-class application to register the following mark:

Grüne Erde expressly abandoned the subject application as part of a settlement to resolve a pending opposition filed against only the Class 3 goods recited in the application.  Although Opposer opposed registration of Grüne Erde’s mark in only one of the seven classes in the application, Grüne Erde did not move to divide the unopposed classes into a separate application.

Pursuant to the parties’ agreement, Opposer filed a Stipulated Withdrawal of Application and Dismissal of Opposition drafted by Grüne Erde.  The Stipulation included the following statement and the signature of counsel of record for both parties:

The parties to this opposition have reached an agreement and respectfully request that the Board enter an appropriate Order withdrawing the application without prejudice and dismissing the opposition without prejudice.

(emphasis added).

Based on the unambiguous language of the Stipulation, the TTAB issued an Order deeming the subject application abandoned in its entirety.

Grüne Erde filed a motion for relief from judgment under Fed. R. Civ. P. 60(b)(1), claiming the “‘the parties did not have a true meeting of the minds when determining the scope of the agreement to resolve the application;’ that ‘Applicant believed the parties’ agreement was only with respect to abandonment of the only opposed class, the goods in Class 3, whereas Opposer [sic] believes the entire application was to be abandoned;’” and that it would, therefore, be appropriate to vacate the TTAB’s Order because of this failure of agreement.  Decision, at p. 3.

The TTAB denied Grüne Erde’s motion, stating that, although Fed. R. Civ. P. 60(b)(1) provides that a party may be relieved from a final judgment, order or proceeding because of “mistake, inadvertence, surprise, or excusable neglect,” Trademark Rule 2.68 unequivocally precluded the relief Grüne Erde sought—namely, the withdrawal of an express abandonment.  Id., at pp. 4-5.

Put plainly, draft stipulations and, in particular, express abandonments with a critical eye to ensure that you carve out any necessary exceptions or limitations to the abandonment.  The TTAB will not be forgiving and no relief from the abandonment will be obtained.

The decision is Rwachsberg Holdings Inc., et al. v. Grüne Erde Beteiligungs GmbH, Opposition No. 91253866 (TTAB Sept. 8, 2021).

On September 1, 2021, the Food and Drug Administration’s final “intended use” rule will go into effect.  The update is meant to clarify the “intended use” regulations for pharmaceutical products and medical devices.  According to the FDA, this “should reduce manufacturer and stakeholder uncertainty regarding the scenarios in which specific types of evidence may or may not show a product is intended for a drug or device use.”  The updates now provide that a manufacturer’s mere knowledge of an off-label use does not carry with it a new labeling obligation or create new “intended uses.”  However, the FDA can look to “any relevant source” of evidence when determining whether a company intended to market a drug or medical device for off-label use.  You can read more about the FDA’s rule change here.

Since the start of the Covid-19 pandemic, the United States Patent and Trademark Office (USPTO) has seen a surge in trademark filings by 40%, which is the greatest number of new applications in trademark history. This rise in filings can at least partially be attributed to foreign entities. Many foreign manufacturers that want to sell to U.S. consumers have been told that they must have a U.S. registered trademark for their product to be prioritized on e-commerce sales platforms. Although foreign manufacturers are aware of the USPTO’s policies, they still try to find a way to get around them, such as hijacking the credentials of U.S. licensed attorneys or using questionable U.S. attorneys who don’t pay attention to their paperwork. Unfortunately, this has driven the USPTO to crack down on its policies. Because of the rise in applications, the USPTO has had to employ new strategies and tactics to combat fraudulent trademarks and trademark related scams, instead of relying on the good faith intentions of its customers. The USPTO has created a special task force consisting of attorneys, analysts, cyber investigators and IT personnel, to investigate suspected fraudulent applications. Those suspected of fraud will be required to submit more information to support their filing(s) and if their response is inadequate, they will be sanctioned. This task force along with other tools employed by the USPTO has had a positive impact on accuracy. To read more about the strategies and tactics being employed by the USPTO, see its blog post here.

ICYMI, a new Trademark Manual of Examining Procedure (TMEP) was released by the United States Patent and Trademark Office (USPTO) last month.  The July 2021 revision replaces and supersedes the October 2018 version, and it incorporates final rules, examination guides, and Supreme Court decisions that have issued since then.  A change summary is available here.

The TMEP is a necessary tool for trademark practitioners.  As summarized on the USPTO’s website, “The Manual is published to provide trademark examining attorneys in the USPTO, trademark applicants, and attorneys and representatives for trademark applicants with a reference work on the practices and procedures relative to prosecution of applications to register marks in the USPTO. The Manual contains guidelines for Examining Attorneys and materials in the nature of information and interpretation, and outlines the procedures which Examining Attorneys are required or authorized to follow in the examination of trademark applications.”

If you have not yet downloaded and saved a copy of the July 2021 TMEP, you can do so here.

Whether the United States Patent and Trademark Office (USPTO) possessed trademark registrations for its own trademarks was honestly not something I had ever thought about before.  But then I received a link to the Director’s Forum blog earlier this month telling me that the Department of Commerce had recently filed for federal registration of the USPTO’s marks with the USPTO.  It appears the reason for doing so after so many years is based on the increase in misleading solicitations and trademark filing scams.  Simply put, the USPTO wants to be able to take legal action against scammers who impersonate it.

trademark brandind advertising copyright conceptIngesting humor into the blog, the USPTO said, “We recognize the intrigue and irony of filing for federal registration of the USPTO marks…with the USPTO. It’s a big reason why the Department of Commerce is filing the application on our behalf, just as it has for its other bureaus.”  Federal agencies that own federal trademark registrations apparently include the Internal Revenue Service, the Environmental Protection Agency, the Food and Drug Administration, the Federal Aviation Administration, the National Aeronautics and Space Administration, the National Oceanic and Atmospheric Administration, the Department of Homeland Security, the National Park Service, and branches of the U.S. military.

As the blog summarizes, “We firmly believe that it’s never too late to do the right thing, and doing everything within our power to protect our trademark customers is the right thing.”

In a recent precedential decision, the TTAB again revisited the doctrines of claim and issue preclusion.

Valvoline Licensing & Intellectual Property LLC (“Valvoline”) opposed Sunpoint International Group USA Corp.’s (“Sunpoint”) application to register the mark MAXVOLINE on the sole ground of likelihood of confusion.  Sunpoint moved for summary judgment based on the defense of res judicata, which people sometimes interpret as encompassing  the doctrines of both claim and issue preclusion.

Sunpoint argued that, in a prior cancellation proceeding between the parties based on the same registrations Valvoline asserted in the current opposition proceeding, the Board determined that Valvoline had failed to prove Sunpoint’s MAXVOLINE mark was likely to cause consumer confusion with Valvoline’s VALVOLINE and MAX LIFE marks.  Sunpoint argued this earlier “ruling” barred Valvoline’s current likelihood of confusion claim.

In an interesting wrinkle, despite commenting on the likelihood of confusion issue, the Board in the earlier cancellation proceeding did not enter judgment on the likelihood of confusion claim; it granted Valvoline’s petition to cancel only on the grounds that Sunpoint had failed to use its marks at the time it filed its statements of use.  Of critical importance, Sunpoint did not appeal the Board’s cancellation decision, choosing instead to file a new application to register MAXVOLINE.

Claim preclusion “bars a second action when there is (1) an identity of parties or their privies; (2) an earlier final judgment on the merits of a claim; and (3) the second claim is based on the same set of transactional facts as the first.”  [Opinion, at p. 6 (citing Jet, Inc. v. Sewage Aeration Sys., 55 U.S.P.Q.2d 1854, 1856 (Fed. Cir. 2000)].  Issue preclusion, also known as collateral estoppel, bars a party from relitigating the same issue in a second action between the parties.  [Id. (citing B&B Hardware, Inc. v. Hargis Indus., Inc., 125 S. Ct. 1293, (2015)].  Issue preclusion requires “(1) identity of an issue in a prior proceeding, (2) that the identical issue was actually litigated, (3) that determination of the issue was necessary to the judgment in the prior proceeding, and (4) that the party defending against preclusion had a full and fair opportunity to litigate the issue in the prior proceeding.”  [Id., at pp. 6-7 (citing Mayer/Berkshire Corp. v. Berkshire Fashions Inc., 76 USPQ2d 1310, 1313 (Fed. Cir. 2005)].  Significantly, neither type of preclusion applies if the party against whom the preclusion is sought to be enforced could not appeal the outcome of the earlier proceeding.  [Id., at p. 7].

As the prevailing party in the earlier proceeding, Valvoline was unable to appeal the Board’s adverse commentary on the issue of likelihood of confusion.  Moreover, while the Board in the earlier cancellation proceeding determined that Valvoline had failed to carry its burden of proof on the issue of likelihood of confusion, that determination did not change the final judgment, which the Board based on a claim of nonuse.  If Sunpoint had appealed the earlier Board decision, Valvoline could have cited likelihood of confusion as an alternate ground for affirming the Board’s decision.  Sunpoint, however, chose not to appeal, depriving Valvoline of that opportunity.  In view of these facts, the Board denied Sunpoint’s res judicata argument.

The decision is Valvoline Licensing & Intellectual Property LLC v. Sunpoint International Group USA Corp., 2021 USPQ2d 785 (TTAB 2021) (precedential).

In a recent precedential decision, the TTAB confronted the issue of timeliness of discovery requests served in opposition and cancellation proceedings—namely, whether Eastern Standard Time (EST) controls the timeliness of service of such discovery requests, regardless of the geographic location of the serving party.  While not a particularly exciting legal issue, it is no doubt one having ramifications for all TTAB practitioners.

In Island, LLC v. JBX Pty. Ltd., Defendant JBX argued Plaintiff Island’s discovery requests were untimely because Island served the requests after midnight EST on the last day for written discovery.  Island disputed JBX’s claim, arguing it timely served the discovery requests from California before midnight Pacific Standard Time (PST).

Under applicable Board Rules, parties must serve discovery requests in sufficient time to require responses before the close of discovery.  37 CFR § 2.120(a)(3).  In this case, discovery closed on January 2, 2021.  Because the answering party receives 30 days to respond to discovery requests, Island needed to serve its discovery requests on or before December 3, 2020.

Island served its discovery requests from California via email on December 3rd, at 11:43 PM PST, or 2:43 AM EST on December 4th JBX’s time.  JBX objected to the timeliness of the discovery requests and Island filed a motion to compel.

Eastern Time governs documents filed with the USPTO.  See 37 CFR § 2.195(a).  See also TBMP § 109.  The TTAB, however, noted that neither Rule § 2.195(a) nor TBMP § 109 reference an Eastern Time deadline, or any other time zone issue in the context of documents that are served between or among the parties, but that are not filed with the TTAB.  [Opinion, at p. 4].  For discovery, timeliness is determined on when a document is served, not when it is received.  37 CFR § 2.120(a)(3).

Trademark Rule 2.119, which governs the requirements for service, does not state whether a specific time zone controls the timeliness of service or whether timeliness is based on the serving party or the receiving party.  37 CFR § 2.119.  The TTAB, however, concluded that a review of its practice demonstrates that the date of service is determined in terms of when the document is transmitted for service.  [Opinion, at p. 5].  “In particular, ‘[w]henever a party to an inter partes proceeding before the [TTAB] is required to take some action within a prescribed period of time after the service of a submission upon that party by another party to the proceeding, and the submission is served by first-class mail, Priority Mail Express®, or overnight courier, the date of mailing or of delivery to the overnight courier will be considered the date of service.’”  TBMP § 113.05.

The TTAB further noted that it also permits a party who, because of a technical problem or extraordinary circumstances cannot serve discovery by email, to serve its discovery by a manner described in Trademark Rules 2.119(b)(1)-(b)(4).  37 CFR § 2.119(b)(1)-(b)(4).  See also TBMP § 403.02.  Thus, a party who meets the requirements to serve discovery requests by, for example, overnight courier will have timely served its discovery requests if it delivers them to the overnight courier thirty-one days before the close of discovery. [Opinion, at p. 6]. “And this is so even though the responding party would receive the discovery requests thirty (rather than thirty-one) days before the close of discovery.”  [Id.].  The answering party’s responses are still due based on the date of service, even though it does not receive the benefit of additional time to respond due to the manner of service.

Based on this analysis, the TTAB concluded that the date of service is to be based on when the document in question is submitted for transmission of service.  [Id.].  Island served its discovery requests by email from California.  Thus, the time zone in California applied to determine the timeliness of service of the discovery requests.  Because Island served the requests on December 3rd before midnight PST, the TTAB concluded Island timely served the discovery requests.  [Id.].

The case is Island, LLC v. JBX Pty. Ltd., 2021 USPQ2d 779 (TTAB 2021) (precedential).

Recently, the Federal Trade Commission (“FTC”) issued a new rule to prevent “Made in USA” labels from being used fraudulently. This new rule codifies the FTC’s policy which requires products which are labeled as “Made in USA”, to be supported by proof that all or virtually all of the product is made in the United States. Additionally, the product must be made from materials which are sourced from U.S. manufacturers. This new rule also expands the remedies which the FTC is authorized to seek, including commencing a civil action to seek civil penalties. Any product which represents that it is made, manufactured, built, produced, created, or crafted in the United States, is covered under this rule.

The FTC’s rules have gotten more stringent when it comes to “Made in USA” labels because of the meaning that these labels have. These labels signal a sense of national pride and communicate that the brand holds itself to certain standards. Brands which falsely use these labels can water down the meaning of what it means to be “Made in USA”. However, this new rule will require any person who tries to advertise a product labeled as “Made in USA”, to provide proof that the entire product or substantially all of the product is of domestic origin. It is possible that the enactment of this rule could slowly return “Made in USA” to its original meaning.

The Food and Drug Administration (“FDA”) and U.S. Department of Agriculture (“USDA”) also have rules regarding “Made in USA” labeling claims. Because both of these agencies have primary jurisdiction over their own regulated products, they can choose whether or not they would like to change their requirements to conform to the requirements set out in the FTC’s new rule.

Now more than ever, it is especially important that brands meet the FTC’s requirements prior to marketing a product as Made in USA or in America. Otherwise, brands run the risk of facing civil penalties. The FTC’s rule will be active 30 days after publication in the Federal Register. For more information and detail on the FTC’s new rule, you can visit the rule here.

Throughout this summer, the United States Patent and Trademark Office (USPTO) is offering its series of virtual webinars dubbed “Trademark Basics Boot Camp.”  The series appears to be tailored to small business owners and entrepreneurs and is broken up into eight modules focused on discrete topics.  Registration for the upcoming modules listed below, as well as access to other past and future modules, is available here.

The USPTO is also offering a separate upcoming event geared toward the restaurant industry.  The free two-hour virtual event, titled “Don’t burn your brand: intellectual property for restaurants,” is set for July 19.  It will include an overview of trademarks, patents, copyrights, and trade secrets in the food-service industry and will cover topics ranging from trademark basics to choosing, filing, and registering trademarks.  Registration for the event is available here.

Don’t miss these opportunities for free information and advice on trademarks and other intellectual property – valuable ways to protect and promote your brand – from the USPTO itself.