Federal Administrative Board Dismisses Allegations of Fraud in Trademark Application

Blue Diamond Gallery [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0/)]Trademark law enables businesses to protect brand names, logos, and other “marks” used to identify, or that are strongly associated with, their products and services. The owner of a registered trademark can use the courts to prevent another business or individual from using a name or logo that is the same as, or substantially similar to, the registered mark. Since a trademark registration confers such a great deal of authority, federal law allows objections to pending trademark registrations, as well as petitions to cancel existing registrations, on various grounds. The Trademark Trial and Appeal Board (TTAB) recently dismissed a cancellation petition alleging fraud during the registration process. Embarcadero Tech., Inc. v. Delphix Corp., Opposition No. 91197762, Cancellation No. 92055153, opinion (TTAB, Jan. 21, 2016).

The term “trademark” generally refers to “any word, name, symbol, or device” used by someone in commerce “to identify and distinguish his or her goods…from those manufactured or sold by others…” 15 U.S.C. § 1127. The term “service mark” has the same meaning applied to services, rather than goods, but the term “trademark” may often refer as a shorthand to both trademarks and service marks.

A person can oppose the registration of a mark by the U.S. Patent and Trademark Office (USPTO) on the ground that they “would be damaged by the registration of a mark.” 15 U.S.C. § 1063(a). This might include harm to the person’s own registered trademark, such as by causing confusion among consumers or by diminishing the value of the existing mark. These are known, respectively, as “dilution by blurring or dilution by tarnishment.” Id. After the USPTO has registered a mark, a person can petition for cancellation of the mark on the same grounds. 15 U.S.C. § 1064. In most cases, this must occur within five years of the registration date.

In January 2009, the respondent in the Embarcadero case filed an application to register a trademark based on a “bona fide intention” to use it in commerce. 15 U.S.C. § 1051(b). It filed a statement of use that August claiming January 31, 2009 as the “date first of use,” and March 1 as the date of first use in commerce.” The respondent provided a substitute specimen of the trademark to the USPTO after its rejection of the original, and it provided a revised statement of use claiming December 3, 2009 as the date of first use in commerce. The USPTO approved the application, and it registered the mark on March 30, 2010.

The petitioner filed a cancellation petition in February 2012, claiming in part that the respondent’s revised statement of use was fraudulent. The respondent moved for summary judgment on the fraud claim after a period of discovery and settlement negotiations. The TTAB noted that a fraud claim requires proof of an “intent to deceive,” which requires a very high burden of proof. Embarcadero, opinion at 5. It found that the petitioner failed “to set forth specific facts…supporting an inference of Respondent’s fraudulent intent,” and it granted the motion. Id. at 7.

Samuel C. Berger is a business formation attorney who practices in New York City and Northern New Jersey. We represent businesses, business owners, and entrepreneurs by offering fixed-fee legal-service packages covering a wide range of matters. To schedule a confidential consultation with a knowledgeable and skilled business advocate, contact us today online, at (201) 587-1500, or at (212) 380-8117.

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Photo credit: Blue Diamond Gallery [CC BY-SA 3.0].