Court finds no abandonment of ATLA mark by American Association for Justice

The American Association for Justice (“AAJ”) (formerly the Association of Trial Lawyers of America) won a signfiicant victory in its trademark infringement lawsuit against The American Trial Lawyers Association (“TheATLA”) (previous blog posts here and here) when the court found that the AAJ had not abandoned its trademark rights to the ATLA mark despite having intentionally made the decision to change its name from ATLA to AAJ. See American Association for Justice v. The American Trial Lawyers Association et al, Case No. 07-cv-04626, 2010 U.S. Dist. LEXIS 25325 (D. Minn. March 18, 2010). Law.com article here.

TheATLA tried to argue that AAJ abandoned its rights to ATLA when it made the decision to change its name. In ruling against TheATLA, the court noted the following:

[A] prospective intent to abandon a mark does not establish abandonment. Electro Source, LLC v. Brandess-Kalt-Aetna Group, Inc., 458 F.3d 931, 937 (9th Cir. 2006). Rather, “abandonment requires complete cessation or discontinuance of trademark use.” Id. at 938. A single bona fide use of a mark “‘is sufficient against a claim of abandonment.’” Id. (quoting Carter-Wallace, Inc. v. Procter & Gamble Co., 434 F.2d 794, 804 (9th Cir. 1970)). If use of the trademark is not actually discontinued, “the intent not to resume use prong of abandonment does not come into play.” Id. at 937-38. Because abandonment constitutes a forfeiture of a property right, it “must be strictly proved” by the party seeking abandonment. See Iowa Health Sys., Inc. v. Trinity Health Corp., 177 F. Supp. 2d 897, 918 (N.D. Iowa 2001) (quotation marks omitted).

The court found that after the official name change in December 2006, AAJ continued to identify itself as “formerly the Association of Trial Lawyers of America” on its website, in advertisements, and mailings to prospective members:

Such use of the designation “formerly” to capitalize on the goodwill and source identification of the marks constitutes bona fide use. Cf. First Fed. Sav. & Loan Ass’n of Council Bluffs v. First Fed. Sav. and Loan Ass’n of Lincoln, 929 F.2d 382, 385 (8th Cir. 1991) (“The new savings and loan plans to capitalize on First Federal Council Bluffs’ good name by advertising itself as the ‘former First Federal.’ This [may] support a continuation of the injunction [prohibiting the defendant’s use of First Federal] for as long as the identification with the former institution is used by the new owners.”); Alliant Energy Corp. v. Alltel Corp., 344 F. Supp. 2d 1176, 1187 (S.D. Iowa 2004) (“Despite a name change, a trademark may still possess significant goodwill and remain a valuable asset to a company. . . . Even in cases such as the present one, where there are extensive efforts to notify the public of the name change, there is still the possibility that goodwill remains in the marks.”).

The court found this evidence alone warranted summary judgment in favor of AAJ and against TheATLA on TheATLA’s affirmative defense of abandonment. The court further reinforced its decision by noting that AAJ had continued to license ATLA to at least one licensee who has continuously used the mark, several publications continued to be published using the ATLA mark, and AAJ maintained the www.atla.org and www.atlanet.org websites to direct users to the organization’s new website (which capitalized on the source identification and goodwill of the ATLA mark by directing those individuals who were drawn to the website by the ATLA mark to the new AAJ website).

With the exception of the issue of abandonment, the court denied the summary judgment motions filed by both sides. The case now moves on to trial.

A New Chapter Opens in the “Who Dat” Trademark Story

Earlier this year, the “Super Bowl” trademark story of the year centered not around the NFL’s usual efforts to crack down on unauthorized use of the SUPER BOWL trademark, but instead about purported efforts by the NFL to claim ownership to the mark WHO DAT (coverage of the dispute here and here)

On March 4, 2010, Who Dat? Inc. (“WDI”) filed a lawsuit against the NFL, the New Orleans Saints, the Louisiana Secretary of State and the State of Louisiana. See Who Dat?, Inc. v. NFL Properties, LLC et al, Case No. 10-cv-00154 (M. D. La. March 4, 2010). A copy of the complaint can be downloaded here (or here). Other press coverage here, here and here.

Courthousenews provides an excellent summary of the pertinent allegations of the 60 page, 189 paragraph, 16 count action complaint (which includes pictures) which tells quite a story about the two men who created the “Who Dat” fight song for the New Orleans Saints back in 1983 and began the dream of creating a name that would make them millions . . . and how the dream became a “nightmare.” But the following paragraph near the beginning of the complaint summarizes the crux of the dispute:

Who Dat?, Inc. developed and nurtured “WHO DAT” for over twenty-five years and was uniquely positioned to reap substantial financial rewards in connection with the 2009-2010 National Football League season. On the eve of that success, NFLP and the Saints filed public documents falsely claiming ownership and first use of the phrase. As anyone would have anticipated, the public voiced outrage and State of Louisiana officials publically challenged the claims made by the NFLP and Saints. Since those entities were not the first users of the phrase and had no standing to make the claims made, they publically conceded that they did not own the phrase. With that concession in hand, state officials declared victory and further declared that the phrase belongs to the people as it is in the public domain. As a natural consequence of these actions, Who Dat?, Inc. was not able to obtain the financial fruits of its labor.

Interestingly, while several Louisiana state trademark registrations are noted throughout the complaint as evidence of WDI’s trademark rights, WDI had very few federal registrations to evidence its trademark rights. One was for soft drinks, but it has since been canceled (the 5 year statement of use was not filed). Another was for the mark WHO DAT BLUE BAND, but as noted in the complaint, this was registered by a third party in 2004, and only assigned to WDI in December 2009 in order to resolve a cancellation proceeding filed by WDI.

WDI had several other intent-to-use trademark applications pending, but each went abandoned for lack of any Statement of Use, including two applications for clothing (here and here) and two applications for potato chips (here and here) – all filed on the basis of intent-to-use and all went abandoned after no Statement of Use was filed. One additional use-in-commerce application for bumper stickers went abandoned after failing to respond to an office action.

More recently, WDI filed another use-in-commerce application for WHO DAT on January 7, 2010, covering musical sound recordings and various clothing items (claiming date of first use going back to October 1983). Unfortunately, WDI’s application to register the mark for its clothing goods will inevitably be suspended pending the outcome of two earlier filed applications for WHO DAT (currently allowed and awaiting a Statement of Use from the applicant and WHO DAT' JE CROIS.

One has to wonder why WDI did not follow through with its federal trademark registrations for clothing if, as stated in the complaint, it was licensing the mark to third parties for use in connection with shirts and other products. It certainly recognized the importance of seeking federal registrations – as evidenced by its prior applications. And while it’s not clear how WDI may have sold its goods throughout the years, it currently sells its goods through the website – whodatstuff.com – a domain name registered on August 13, 2009.

The situation serves as lesson that a trademark is only as good as its ability to serve as a unique source identifier for a particular source of goods or services. Just because you come up with a unique phrase does not mean that you have any exclusive rights to the term to the extent you are not actually using it in a manner that would be recognized as a source identifier in connection with particular goods and services. As for WDI, it's one thing to talk about having created a unique term or phrase – its quite another to have the evidence to show that it has always served as a unique identifier for WDI's goods and services. We shall see.

The SOHMER piano trademark war - a new battle front opens in Illinois District Court

A long-running battle being waged between two companies over the trademark rights to the mark SOHMER in connection with the sale of pianos just got kicked up an additional notch.

On February 15, 2001, an Illinois man named Edward Richards filed an intent-to-use trademark application with the U.S. Patent and Trademark Office (“PTO”) to register the mark SOHMER in connection with pianos. Eight days later, on February 23, 2001, a company named Burgett, Inc. (“Burgett”) filed an intent-to-use trademark application to register the identical mark SOHMER in connection with pianos.

The PTO initially refused Richards’ application on the basis of Section 2(e)(4) that the mark was primarily a surname. In order to get around this refusal, Richards filed an Amendment to Allege Use on August 19, 2002, and then amended his application to seek registration of the mark on the Supplemental Register (in order to get around the surname refusal). However, for reasons discussed herein, the PTO did not move his application onto registration, but instead suspended prosecution of Richards’ application

The PTO also initially refused Burgett’s application on the basis of Section 2(e)(4). The PTO also cited the existing of Richards’ earlier filed application as possible grounds for a Section 2(d) likelihood of confusion rejection and suspended prosecution. However, when Richards converted his application to one on the Supplemental Register, the effective filing date of the application changed to the date he filed his Amendment to Allege Use which was after the effective filing date of Burgett’s application, and thus it no longer could serve as a basis for a possible Section 2(d) refusal.

Of course, there was still the little matter of the Section 2(e)(4) refusal. The PTO made its refusal to register based on Section 2(e)(4) final. Burgett filed a request for reconsideration, which was considered after an ex parte appeal was filed to the Trademark Trial and Appeal Board and the Board remanded the case back to the PTO for consideration of the request for reconsideration. The PTO denied the request for reconsideration on November 20, 2003, and ordered the case back to the Board.

Then a funny thing happened in early 2004. Burgett’s President, Gary Burgett, filed a declaration with the PTO in February 4, 2004, that Burgett was the owner of the rights and goodwill to the mark SOHMER in connection with pianos that had been developed since 1872 by the Sohmer & Company (later Mason & Hamlin) and that the mark had become distinctive for pianos through “the substantially exclusive and continuous use of the mark in commerce by the Applicant and related companies for at least five years” preceding February 4, 2004.

While not clear from this Declaration, the basis for Burgett’s claim of ownership of the SOHMER name was the fact that Burgett’s predecessor-in-interest, Burgett Brothers Incorporated, had acquired the assets of Mason & Hamlin out of bankruptcy in 1996, including the trademark registrations owned by the bankrupt company at the time. The PTO’s Assignments records (click here) reflect the chain of title for the SOHMER marks that were still registered at the time. At the same time, it was apparently well known in the piano industry that the SOHMER factory in Pennsylvania had closed down in 1994.

Nevertheless, reviewing the Declaration at face value, Burgett declared that the SOHMER mark had been used continuously since February 1999. Of course, of the four SOHMER marks that had been registered with the PTO (word mark, design mark, SOHMER & CO., and design mark), the SOHMER word mark was canceled on December 20, 2000, for failure to file a Section 8 Declaration of Use and the SOHMER design mark was cancelled on December 2, 2001 for failure to renew. Nonetheless, the Declaration was accepted at face value and apparently enough to convince the PTO to allow the mark to be registered on the Principal Register under Section 2(f) based on a claim of acquired distinctiveness.

After the mark was published for opposition, Richards, who had assigned his own application to his company Persis International, Inc. (“Persis”), filed an opposition on October 19, 2004. Persis International, Inc. v. Burgett, Inc., Opposition No. 91162715 (TTAB Oct. 19, 2004).

The opposition progressed along for several years with Richards showing Burgett and the world that you don’t need an attorney to make an effective legal argument. Because an officer of a company can represent the company before the TTAB, Richards served as the legal representative for Persis during the entire opposition.

During discovery (which became so evasive at one point that Persis obtained sanctions against Burgett), it was discovered that Burgett’s basis for claiming that the SOHMER mark had continued to be used was a single invoice of a sale of a single piano to who it turns out was an employee (who according to affidavit testimony from that employee, purchase the piano first and was then asked if they could change the name on the front of the piano to SOHMER). Burgett’s response was that this piano was an original work in progress from the old SOHMER piano company that had closed down in 1994 – despite other evidence that showed the particular piano sold was a KNABE brand piano built in China by the Young Chang Piano Company with specifications that did not match the types of pianos produced by the Sohmer Pennsylvania factory. Burgett also provided vague information about sales figures from the years 1996 – 2006 but did not produce specific sales records.

As the time for trial before the TTAB moved closer, several new developments occurred. On March 11, 2009, Burgett decided to assign its trademark application to Samick Music Corporation (“Samick”), supposedly Burgett’s exclusive licensee of the SOHMER mark based on a license agreement entered into sometime in 2002. A further development was that Burgett’s counsel filed a motion to withdraw as counsel on the basis that Burgett no longer had an interest in the opposition proceeding. While Burgett’s attorneys were allowed to withdraw, Persis was successful at keeping Burgett as a party to the proceeding since it was the declaration of Burgett’s president that provided Persis with its strongest evidence that Burgett had committed fraud on the PTO with its declaration of continuous five years use of the SOHMER mark.

But the biggest development came in the form of Samick’s decision to file a civil lawsuit in Nevada District Court against Persis on April 15, 2009. See Samick Music Corporation v. Persis International, Inc., Case No. 09-cv-00197 (D. Nev.). A copy of the complaint can be downloaded here.

The basis for the sudden filing of a district court complaint given the long running opposition proceeding that was close to the finish line can probably be best explained by the fact that in federal court, a company must be represented by an attorney. And while Richards may have been a vociferous advocate for his company before the TTAB, federal court rules prevent him from performing the same role in this lawsuit (until such time as he gets a law degree and passes a bar exam).

Despite the strategy behind the filing, Samick’s complaint reiterates its position as the rightful successor-in-interest to the SOHMER mark in connection with pianos and attempts to demonize the efforts of Richards to apply for registration of and use the SOHMER mark in connection with pianos. Samick’s causes of action against Persis are for federal trademark infringement and unfair competition, common law trademark infringement and unfair competition, and federal trademark dilution,

The most recent development occurred on November 30, 2009, when Persis and Richards filed a lawsuit in the U.S. District Court for the Northern District of Illinois against Burgett. See Persis International, Inc. et al v. Burgett, Inc., Case No. 09-cv-07451 (N.D. Ill.). A copy of the complaint can be downloaded here.

But where the Nevada complaint laid out the story in the light most favorable to Burgett & Samick, this Illinois complaint lays out the story from the perspective of Richards and Persis.

According to this complaint, at the time Burgett acquired the aforementioned trademark registrations out of bankruptcy from Mason & Hamlin in 1996, the company had not manufactured, sold or distributed any pianos bearing the SOHMER trademark since at least 1994 nor did Burgett have any intent to resume use of the marks. Moreover, Burgett allegedly did not use the SOHMER trademark in connection with the manufacture, sale or distribution of pianos between 1996 and 2003, and accordingly, abandoned its rights to the mark. One interesting fact from the complaint is that in 1999, Burgett supposedly authorized the destruction of five original SOHMER plate pattern that had been used to manufacture the cast iron piano plates that are essentially to manufacturing SOHMER brand pianos.

According to the complaint, Richards contacted Burgett in late 2000 to discuss the possibility of purchasing one of the piano brands that Burgett had publicly announced that it was discontinuing. At that time, Burgett supposedly told Richards that the names SOHMER and GEORGE STECK were available for purchase. Richards and Burgett agreed on the sale of the GEORGE STECK mark for $100,000, and in early 2001, Richards provided an initial deposit of $33,500. However, Burgett later refused to complete the sale or return the deposit unless Richards withdrew his application for the SOHMER trademark. Burgett supposedly offered to sell Richards its rights to the SOHMER trademark, but Richards refused on the basis that Burgett had not used the SOHMER mark, had destroyed the SOHMER plates, and had even let the trademark registrations expire. [Comment—not to mention the fact that Richards had already filed a trademark application to register the mark].

The complaint then turns its focus to the 2002 license agreement with Samick licensing Burgett’s rights in the SOHMER mark to Samick. From Richards’ and Persis’ perspective, Burgett was aware that Persis was using the SOHMER mark in connection with the sale of pianos and that it had not valid trademark rights to the SOHMER mark when it entered into this license agreement with Samick. Persis publicly exhibited its SOHMER pianos at a piano trade show in July 2002. In early 2003, Samick began selling pianos bearing the SOHMER mark which Persis claims infringes its superior rights. Moreover, Burgett’s actions induced Samick’s acts of infringement.

Persis’ first cause of action against Burgett is for contributory trademark infringement based on its license agreement with Samick for the SOHMER mark despite Burgett’s knowledge that it had abandoned any rights to the SOHMER mark with no bona fide intention to resume use as well as Burgett’s knowledge of Persis’ rights to the SOHMER mark. Additional causes of action are for unfair competition under federal, state and common law, violation of Illinois’ deceptive trade practices act, and unjust enrichment and promissory estoppel (based on the $33,500 deposit that Burgett did not return).

So should Samick be able to lay claim to the reputation and goodwill of the SOHMER mark despite the clear break in use of the mark in connection with pianos or did Persis acquire legitimate rights to an abandoned trademark that it should be allowed to assert against Samick? Of course, even if Persis can show that the mark was abandoned and thus the goodwill never properly transferred to Samick, the ability of Persis to assert trademark infringement against Burgett/Samick may still depend on whether or not (and the extent to which) Persis has established its own strong common law rights in the mark since Persis' acceptance of a registration of the mark on the Supplemental Register is tantamount to an acknowledgment that Persis' trademark rights are only as strong as its common law rights. Persis' case is made even more challenging by the fact that much of the time when Persis was trying to build up a reputation in the name was during the same time that Samick was also using the same mark in connection with the same goods albeit not to take advantage of the reputation and goodwill that Persis had established in the name but instead to take advantage of the reputation and goodwill that had been established in the SOHMER name long before (even though legally abandoned).

Psion Agrees to Surrender NETBOOK Registered Trademark

Back in February, Intel Corp. filed a declaratory judgment action against Psion Teklogix, Inc. seeking a declaration that Psion’s registered trademark NETBOOK is generic for laptop computers (previously blogged here). The action was filed after Intel (along with numerous other well-known names like Dell, HP, and Best Buy) received a cease and desist letter from Psion.

Intel was challenging Psion’s trademark registration on the grounds that while Psion may indeed have used the term NETBOOK in connection with small portable computers at one time, it abandoned the name in 2003 (making its 2006 Section 8 Declaration of Use fraudulent). Dell had also filed its own cancellation proceeding with the Trademark Trial and Appeal Board against Psion. That action was stayed pending the outcome of Intel’s declaratory judgment action.

News reports out yesterday (here and here) reported that Psion has agreed to settle the Intel lawsuit.

Psion stated in a press release that as part of its “amicable agreement” with Intel, it would surrender (i.e. voluntarily cancel) its NETBOOK trademark registration and will no longer pursue against trademark enforcement actions against any third parties using the term:

The litigation has been settled through an amicable agreement under which Psion will voluntarily withdraw all of its trademark registrations for ‘Netbook’. Neither party accepted any liability. In light of this amicable agreement, Psion has agreed to waive all its rights against third parties in respect of past, current or future use of the ‘Netbook’ term.

Las Vegas’ “Heavy Hitter” Glen Lerner Files Declaratory Judgment Action Against Owner of “Heavy Hitters” service mark

Most cities probably have at least one personal injury lawyer who is recognized by the public simply from the attorney’s extensive TV advertisements promoting the lawyer’s legal services. In Las Vegas, that attorney is Glen Lerner. Lerner, who established his practice in Nevada in 1991, is well recognized for his somewhat cheesy low-budget TV commercials advertising his personal injury legal services which have been gracing the Las Vegas airways for many years and have made him a mini-celebrity here (I suspect that he keeps his ads intentionally cheesy at this point because while he can certainly afford more polished ads, the cheesiness of his commercials have become another one of his signatures). You can check out some of his greatest hits on YouTube (here as well as his famous Super Bowl – pardon me, “Big Game” ad here.

But if you ask Las Vegas locals to describe Lerner in 3 words or less, most likely you will hear them refer to Lerner as “The Heavy Hitter.” Sometime in 2001, Lerner began promoting himself as “The Heavy Hitter.” While the ad campaign certainly grabbed the attention of the Las Vegas public, it also got the attention of the State Bar of Nevada, who told Lerner that calling himself “The” Heavy Hitter was false and misleading because it’s a statement that he is the only heavy hitter. Instead, the Nevada Bar told Lerner that he could only be “a” heavy hitter. Click here for a Las Vegas Review Journal article on the “heavy hitter” dispute between Lerner and the State Bar of Nevada.


Now Lerner finds himself in the midst of another dispute over the “heavy hitter” moniker – but this time it’s a trademark dispute with a company with which Lerner (apparently up until recently) had a licensing arrangement to use the name HEAVY HITTER. Lerner has apparently refused to pay the agreed-upon licensing fee and is now challenging the company’s trademark rights in court.

On August 22, 2008, Lerner filed a declaratory judgment action against Richard Sackett, LawCo USA, PLLC (“LawCo”), and Group Matrix, Inc. (“Group Matrix”) (collectively, the “Defendants”) in the U.S. District Court for the District of Nevada. See Lerner v. Sackett et al, Case No. 08-cv-01123 (D. Nev.). A copy of the complaint can be downloaded here.

According to the complaint, LawCo and Group Matrix are both advertising agencies purportedly owned and operated by Sackett. LawCo is the named registrant of the registered trademark HEAVY HITTERS for legal services, which it filed on April 3, 2001 as an intent-to-use application and registered on February 1, 2005. Several months after this first application was filed, Sackett himself on August 22, 2001 filed an intent-to-use trademark application for the mark HEAVY HITTERS for advertising, management, and marketing of legal services (later amended to business management, marketing, and advertising services specifically for the legal services of others). The application has been allowed, but no Statement of Use has yet been filed by Sackett.

At first, without knowing anything about LawCo or Sackett, one might think that the two applications and applicants were completely unrelated. Indeed, the attorney of record for Sackett’s application in the Office Action Response filed June 11, 2002 had to argue no likelihood of confusion in response to the PTO’s citation to LawCo’s then pending application. But after the PTO maintained its likelihood of confusion rejection over LawCo’s HEAVY HITTERS mark after it registered, Sackett’s counsel submitted a Declaration stating that Sackett is the “general manager and controls the activities of LawCo USA, P.L.L.C. Corporation.” As such, this makes LawCo and Sackett “related entities” and therefore, the PTO withdrew the likelihood of confusion rejection.

Lerner’s lawsuit seeks a declaratory judgment that his use of the HEAVY HITTER and HEAVY HITTERS marks for legal services does not infringe Defendants’ trademark rights in its Heavy Hitter Marks.

According to Lerner’s complaint, sometime in 2002, Lerner entered into some kind of license agreement with the Defendants to allow Lerner to use the mark HEAVY HITTER in the advertising and promotion of Lerner’s legal practice. [Note: The complaint states that Lerner “attempted” to enter into an agreement, but other parts of the complaint, notably those asking for the agreement to be rescinded, suggest that an actual agreement was indeed entered into by the parties.] At the time, the Defendants claimed trademark rights to the marks HEAVY HITTER and HEAVY HITTERS for use in connection with legal services was based on the above trademark applications. The Defendants have apparently entered into other license agreements with other third party legal service providers to use its Heavy Hitter Marks.

Lerner argues that the Defendants fraudulently induced him to enter into the agreement based upon a misrepresentation that Defendants held legitimate trademark rights in the Heavy Hitter Marks. [Comment—An intent-to-use application by an applicant with a bona fide intent to use the mark does provide the applicant with legitimate inchoate trademark rights]. Lerner further argues that the Defendants do not provide legal services in connection with the Heavy Hitter Marks nor can they provide such services because they are not licensed attorneys capable of providing legal services. [Comment—“legal services” is a pretty broad category and doesn’t necessarily mean the “practice of law” and Defendants controlled license of the marks constitutes use].

Lerner also claims that Defendants lost their trademark rights by not exercising any quality control over Lerner’s legal services or over any legal services offered by another other third party licensees of the Heavy Hitter Marks. [Comment—My favorite defense – the “naked license”].

Lerner apparently received a cease and desist letter from the Defendants on or around August 14, 2008, threatening suit if he did not stop using the Heavy Hitter Marks, thereby leading to Lerner’s reasonable apprehension that Defendants will file legal action against him and the basis for his seeking declaratory relief.

Based on Defendants’ fraud and naked license, Lerner argues that Defendants have no trademark rights in the Heavy Hitter Marks and thus his use of the marks HEAVY HITTER and HEAVY HITTERS cannot constitute federal or state trademark infringement or unfair competition. Lerner seeks a declaration that his use of the mark HEAVY HITTER or HEAVY HITTERS does not infringe Defendant’s registered trademark, is not likely to cause confusion as to source, origin or affiliation or otherwise constitute unfair competition with Defendants trademark rights, and does not constitute trademark infringement or unfair competition under Nevada state law.

For good measure, Lerner also seeks cancellation of Defendant’s registered HEAVY HITTER mark on the grounds of abandonment and fraud on the USPTO. Lerner argues that the Defendants have abandoned the mark because they have not used the mark in commerce in connection with legal services since the application was filed in 2001. [Comment—what about use by a licensee, such as Lerner?] While not stated very clearly, the complaint also seems to be alleging that since the Defendant never used the mark in commerce, then the Defendants committed fraud on the USPTO when it claimed in its Statement of Use filed August 18, 2003 that it began using the mark at least as early as January 5, 1999. [Practice Pointer: Allegations of fraud on the PTO should be specifically identified. If you want to play the “fraud” card, make sure your complaint specifically identifies the false statement of material fact that the trademark applicant knew or should have known was false at the time and make sure you allege that the PTO relied upon such false statement in issuing the trademark registration.]

Finally, Lerner throws in a claim of common law fraud based on Defendants’ false representation that the Defendants had legitimate rights to the Heavy Hitter Marks, knowledge that its representation was false (i.e., Defendants knew that they were not offering legal services in connection with the Heavy Hitter Marks or were not exercising any quality control over any licensees of such marks), and detrimental reliance on the part of Lerner with respect to those false representations (but for the false representation, he would not have entered into the license agreement with the Defendants). Lerner requests that the “agreement” be rescinded by the court, and thus, Lerner’s use of the Heavy Hitter or Heavy Hitters mark could not be a breach of contract.

The prosecution history of the registered trademark application for HEAVY HITTER would give any reasonable person grounds for questioning the legitimacy of the trademark rights thereunder. After filing the application as an intent-to-use application on April 3, 2001, the application sailed through and received a Notice of Allowance on March 5, 2002. All LawCo had to do was file a Statement of Use or Extension of Time within six months. But for reasons unknown, the due date (September 5, 2002) passed. On October 10, 2002, LawCo filed the Extension Request along with a Petition to Revive the application (having missed the due date for filing such Extension Request). After the Extension Request was granted, LawCo had until March 5, 2003 to file a Statement of Use or additional Extension Request. So what happened? The due date once again came and went without any timely filing. On March 27, 2003, the applicant once again filed the Extension Request that should have been filed along with a second Petition to Revive. This extended the time for LawCo to file a Statement of Use or additional Extension Request to September 5, 2003.

On August 18, 2003, Lawco finally submitted its Statement of Use, but oddly claiming first use as early as January 5, 1999, and attaching a telephone lawyer advertisement for a personal injury law firm in Rochester, NY named Alexander & Catalano which boldly proclaimed “Call The Heavy Hitters!” [Query—If the mark had really been in use since January 5, 1999, how come LawCo couldn’t come up with a specimen of use in a timely manner – and how come LawCo had to file the application originally as intent-to-use?]

Because the drawing of the mark submitted with the application is for HEAVY HITTERS and the specimen showed “Call The Heavy Hitters!” the PTO rejected the specimen and demanded a substitute specimen showing the mark as depicted in the drawing. In response, LawCo apparently provided a CD of “‘Heavy Hitter’ commercials” that were in use prior to the date the Statement of Use was filed and argued that they reflected use of the “HEAVY HITTERS” mark as an “attention-getting symbol” which would be recognized as a service mark.

Well, based on the PTO’s final action in response to the CD, the ads apparently showed the mark HEAVY HITTER and THE HEAVY HITTER [Ed.-Hmmm, I wonder whose ads those were?] which still differed from the original drawing of the mark HEAVY HITTERS submitted with the application. The Examining Attorney allowed LawCo to amend the drawing to HEAVY HITTER so that it conformed to the specimen (apparently not finding such a change to be a material alteration of the essence or character of the mark). And with that, LawCo finally got its service mark registration.

Vegas™Esq. Comments:
As questionable as the prosecution of the application appears to be, there may not be enough of a false statement of material fact in the Statement of Use to kill the registration on the basis of fraud (the stated dates of use, while certainly questionable, will not be deemed material so long as the mark was used in connection with the services as of the date the Statement of Use was filed). Lerner could try to argue that the Defendants never had a bona fide intent to use the mark in commerce, but that may be difficult given the licensing arrangement entered into between the Defendants and Lerner in 2002.

As for abandonment, 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. See Turner v. HMH Publishing Co., Inc., 380 F.2d 224, 229, 154 USPQ 330, 334 (5th Cir. 1967), cert. denied, 389 U.S. 1006, 156 USPQ 720 (1967).

Of course, the key word in the above is “controlled” licensee, which comes back to what may be the best argument for Lerner’s abandonment defense -- the apparent “naked license.” If Lerner can show evidence that Defendants have not, nor have they ever, taken any reasonable steps to monitor the quality of the services rendered by Lerner and other licensees, then such failure to ensure quality control can result in the trademark ceasing to function as a symbol of quality and a controlled source in which case the trademark will be deemed to have been abandoned and the Defendants would be estopped from asserting rights to the mark.

For what it’s worth, when I think of the “Heavy Hitter,” only one “source” comes to mind.

Eleventh Circuit Decision Highlights Importance of Expeditious Prosecution of Trademark Applications

Rebecca Tushnet’s 43(B)log has a good summary (link here) of the Eleventh Circuit Court of Appeals decision in Natural Answers, Inc. v. SmithKline Beecham Corp., Case No. 06-15084 (11th Cir. June 13, 2008) affirming a lower court’s decision granting summary judgment in favor of SmithKline Beecham, the maker of a stop-smoking lozenge named Commit Lozenges, and rejecting trademark infringement and false advertising claims brought by Natural Answers, which at one time sold a stop-smoking lozenge under the name HERBAQUIT.

The case demonstrates once again the importance of obtaining federal registration for trademarks and service marks early and expeditiously. Here, Natural Answers’ case was hurt in part because it had not followed through with its two trademark applications for the marks HERBAQUIT and HERBAQUIT LOZENGES (both for dietary supplements). The court’s opinion notes that neither of these federal trademark applications were approved, which left Natural Answers with the uphill task of having to prove common law trademark rights

What is strange is that if you look more closely at the actual prosecution history of the applications, both of the applications did receive notices of allowances from the PTO. However, because both were filed as Section 1(b) intent-to-use applications, the marks could not be registered until Natural Answers submitted specimens of use.

The HERBAQUIT mark was allowed February 29, 2000. Natural Answers filed a statement of use on August 29, 2000 (the last day without requesting an extension of time). Unfortunately, the statement of use was defective and the case went abandoned because Natural Answers did not file an extension of time to file a statement of use, which it could have done even though a statement of use was filed (lesson to be learned -- better safe than sorry).

According to the court’s decision, HerbaQuit Lozenges entered the market in January 2000 and were sold by Natural Answers in drugstores, supermarkets, convenience stores, and over the Internet. If this indeed was the case, one wonders how come Natural Answers was unable to provide a specimen of use in March 2000 promptly after the notice of allowance was issued.

A similar question is raised for the HERBAQUIT LOZENGES mark, which was allowed September 5, 2000. The application was abandoned about a year later when no statement of use was ever filed. However, according to the court’s decision, Natural Answers did not discontinue selling its HerbaQuit Lozenges until March 2002. Again, one wonders why Natural Answers was unable to provide a specimen of use in September 2000 promptly after the notice of allowance was issued.

Would having registrations had made a difference in the outcome of the case? Probably not given the evidence of abandonment, which would have been just as relevant had Natural Answers actually obtained registrations for its marks. Nonetheless, the court does suggest in dicta that actual registrations might have been an additional factor which would have favored Natural Answers (“On this record, it is undisputed that the HERBAQUIT LOZENGES mark (which has never been registered) has not been used in commerce since, at the latest, March 2002.”). Instead, the fact that Natural Answers allowed both applications to go abandoned only reinforced the notion that Natural Answers intended to abandon use of the marks.

The American Trial Lawyers Association faces trademark infringement lawsuit from Association of Trial Lawyers of America

When one group of trial lawyers files a lawsuit against another group of trial lawyers, who wins? This sounds like a lawyer joke where the punchline is “Who cares.”

The Washington Post today ran a story about a trademark infringement lawsuit filed by the American Association for Justice, the group formerly known as the Association of Trial Lawyers of America. See Jeffrey H. Birnbaum, “A Case of Trial Lawyers v. Trial Lawyers,” The Washington Post, November 30, 2007, at D01 (link here).

For many years, the Association of Trial Lawyers of America (ATLA) was one of the largest and most politically powerful trial lawyer organizations in the U.S. representing the political interests of its roughly 56,000 members. After years of being the brunt of attacks from politicians and big corporations as an organization of greedy “trial lawyers,” the ATLA decided to change its name to the American Association for Justice (AAJ) (because while politicians and big business can attack an organization representing greedy trial lawyers, they cannot possibly attack an organization dedicated to justice).

Around the same time as the name change, however, a man named J. Keith Givens apparently formed a new competing “trial lawyer” organization named The American Trial Lawyers Association (“TheATLA”) and began soliciting AAJ members to join.

The lawsuit was filed by the AAJ against TheATLA and J. Keith Givens on November 15, 2007 in the U.S. District Court for the District of Minnesota. See American Association for Justice v. American Trial Lawyers Association et al, Case No. 0:2007cv04626 (D. Minn.). The lawsuit seeks injunctive relief to prevent TheATLA from using the name and confusingly similar acronym. The suit also seeks profits from using the name, treble damages, and attorney’s fees (in “typical trial lawyer fashion” as the WaPo article eloquently notes).

AAJ currently holds two registered trademarks for the mark ATLA, both of which issued in 1976: 1) a service mark directed to providing seminars and meetings for attorneys and 2) a collective membership mark indicating membership in the organization. It should be noted that AAJ continues to use the domain name http://www.atla.org/ as its home page.

It is interesting that the AAJ fought its own legal battle over its former name many years back. The AAJ adopted its former name only after the American College of Trial Lawyers (“ACTA”) successfully blocked the organization from calling itself the American Trial Lawyers Association – instead settling for the Association of Trial Lawyers of America.

TheATLA may have anticipated its own potential battle with the ACTA regarding its name. The WaPo article states that the ACTA filed its own lawsuit to prevent TheATLA from using the name American Trial Lawyers Association. However, federal court records seem to indicate that it was TheATLA that actually filed suit against the ACTA – possibly a declaratory judgment action that its name does not infringe upon ACTA’s name. On November 20, 2007, TheATLA filed a lawsuit in the U.S. District Court for the Middle District of Alabama against the ACTA. See The American Trial Lawyers Association, Inc. v. American College of Trial Lawyers, Case No. 1:2007cv01024 (M.D. Ala.). Perhaps Givens feels that this time around TheATLA will be more successful than the original ATLA was against the ACTA.

TheATLA’s battle over its name is also playing out at the USPTO. On March 20, 2007, TheATLA filed two Section 1(b) intent-to-use applications for two different versions of the above name and logo of its organization (here and here). Each application covers association services promoting the interests of lawyers and arranging and conducting educational conferences. The USPTO issued non-final office actions on June 28, 2007, refusing to register the marks under Section 2(d) because of a likelihood of confusion with AAJ’s aforementioned ATLA registrations.

Given the obvious likelihood of confusion between ATLA and TheATLA, the only chance of success on the part of TheATLA against AAJ’s registered marks (both in the USPTO and in the federal action) is to argue that that AAJ’s registered ATLA marks should be cancelled under 15 U.S.C. §1064 on the grounds that the marks were abandoned by AAJ when it changed its name.

Indeed, TheATLA may have grounds for arguing that the AAJ’s registrations should be cancelled. Under §45 (15 U.S.C. §1127), a mark is deemed to be “abandoned” if its use has been discontinued with intent not to resume such use. The intent not to resume may be inferred from the circumstances and nonuse for 3 consecutive years shall be prima facie evidence of abandonment. The “use” of a mark means the bona fide use of such mark made in the ordinary course of trade, and not made merely to reserve a right in a mark. AAJ made it clear that it will no longer call its organization by its old name – and thus have no need for the acronym ATLA. AAJ will counter by arguing that its website (atla.org) and some other remaining uses of the acronym constitute use of the mark.

However, even if TheATLA were successful in cancelling AAJ’s registrations, this does not necessarily translate into TheATLA continuing to use its name, because the organization must still contend with AAJ’s §43(a) grounds for relief. Although AAJ may no longer go by the name Association of Trial Lawyers of America or the acronym ATLA, there is still a long-standing association between the two names and the well-known trial lawyers group. As such, the use of a confusingly similar name and acronym by TheATLA is very much likely to cause confusion or cause mistake, or to deceive the public as to the affiliation, connection, or association of TheATLA with the organization formerly known as ATLA or confusion or mistake as to the origin, sponsorship, or approval of TheATLA by the organization formerly known as ATLA.

One thing is for certain – with trial lawyers on both sides, it is sure to be an interesting and contentious case.