Federal Circuit: "Capital City Bank" marks not confusingly similar to CITIBANK

The Federal Circuit today handed Citigroup a loss in its opposition proceeding pitting its CITIBANK marks against several marks containing the words “CAPITAL CITY BANK.” Although the decision in Citigroup Inc. v. Capital City Bank Group, Inc., No. 2010-1369 (Fed. Cir. Mar. 28, 2011) was fairly fact-specific, a couple of legal points stood out. First, the Federal Circuit rejected the TTAB’s practice of considering only “reasonable” manners of depicting word (standard character) marks. The court stopped short of re-defining exactly what range of depictions should be considered, however, leaving ambiguity as to exactly what the precise broadening effect of this holding will be. Second, the court noted that “pervasive” use of the phrase “City Bank” in other financial service marks (both registered marks and those found used on various bank websites) “limits the protection afforded to the CITIBANK mark." Interestingly, on appeal, Citigroup waived its arguments as to dilution.

Three recent trademark and copyright decisions of note

In the past week or so there have been a few appellate trademark and copyright decisions that, while not earth shattering, probably merit a brief note.

In Seller Agency Council, Inc. v. Kennedy Center for Real Estate Educ., Inc., No. 08-56791 (9th Cir. Sept. 3, 2010), the Ninth Circuit officially defined the equitable defense of acquiescence in a trademark case with the three-part test other circuits have used: (1)the senior user actively represented it would not assert a claim; (2) the delay between the representation and the assertion of the claim was not excusable; and (3) the delay prejudiced the defendant.

In the ongoing saga of the copyright-infringing Baltimore Ravens football logo design, the 4th Circuit held that the fair use defense insulated the Ravens—who discontinued the infringing logo several years ago—from liability for displaying the infringing logo in a pictorial collage of the organization’s history in its corporate office, but not for selling highlight films from the years when the players wore the infringing design on their helmets. Bouchat v. Baltimore Ravens L.P., No. 08-2381 (4th Cir. Sept. 2, 2010).

In a patent/trademark case in which the district court made some seemingly bizarre trademark rulings, the Federal Circuit held that a trademark invalidity declaratory judgment cannot be dismissed for lack of an Article III case or controversy where the mark owner has actually sued the party seeking the D.J. for infringement. (One would have thought that this is not a concept that needs to be rectified at the appeals level.) In another part of the opinion, the Federal Circuit also used imprecise nomenclature when it repeatedly referred to a demand for a disgorgement of profits as a “damage” claim—an imprecision that could cause confusion down the line since the principles applying to each remedy are quite different. Green Edge Enters., LLC v. Rubber Mulch Etc., LLC, No 2009-1455 (Fed. Cir. Sept. 7, 2010).

Federal Circuit ruling on website-based trademark specimens

In a mundane but useful decision, the Federal Circuit recently overturned the PTO’s “bright-line rule that a trademark specimen of use taken from a website must contain a picture.”

In In re Sones, No. 2009-1140 (Fed. Cir. Dec. 23, 2009), the specimen consisted of two webpage print-outs. One was a page from a website advertising a “charity bracelet” under the asserted mark "ONE NATION UNDER GOD™." There was no picture of the bracelet on the webpage, only a placeholder icon stating “Photo not available.” This webpage appeared to allow the user to click on an “Add to Cart” icon, indicating that the item could be ordered right off the website. The applicant also provided a sample webpage order form with the bracelet in the "cart."

The test that the Federal Circuit articulated in lieu of the website-picture requirement is that the website specimen “must in some way evince that the mark is ‘associated’ with the goods and serves as an indicator of source.” The court noted that while a picture is “an important consideration,” all relevant factors should be assessed, including whether the webpage specimen has a “point of sale nature,” whether the actual or inherent features of the product are recognizable from the textual description, and the use of the “™” symbol.

While the Court rejected the PTO’s “website-picture” requirement, the Court did not approve the specimen at issue, but instead remanded for a determination whether the specimen met the newly-articulated test.

Couple of Marginally Interesting TM Decisions (9th Cir. and Fed. Cir.)

Hey, They Copied My Product Idea and Owe Me Mega-$$

First, a Ninth Circuit decision dealing with the familiar and usually unsuccessful case of someone claiming that a defendant copied their idea for what ultimately became a tremendously successful product. At issue in Art Attacks Ink, LLC v. MGA Entertainment Inc., No. 07-56110 (9th Cir. Sept. 16, 2009) were the popular line of BRATZ dolls. The court shot down the plaintiff’s copyright claim because the plaintiff had insufficient evidence of copying or access by the defendants. The plaintiff’s trade dress claim foundered on the shoals of inadequate proof of secondary meaning.

Numbers as Secondary Trademarks

Hidden in the middle of the patent decision in Vita-Mix Corp. v. Basic Holding, Inc., No. 2008-1479 (Fed. Cir. Sept. 16, 2009), was the Federal Circuit’s discussion of whether the asserted trademark—here, the numerical designation 5000—functioned as a trademark or merely as a “grade designation.” The plaintiff used the number in the mark “Vita-Mix® 5000,” to distinguish it from the plaintiff’s previous products, the “Vita-Mix® 3600” and “Vita-Mix® 4500.” Given that the plaintiff didn't use the number apart from the mark “Vita-Mix® 5000,” and in light of plaintiff’s concession that the number served only to differentiate from the two previous “Vita-Mix®” products, the Federal Circuit held that "5000" reflected only the “style or grade” of product and possessed neither inherent nor acquired distinctiveness.

Commentary: The Vita-Mix case touches upon, but doesn’t really discuss, an issue that has always intrigued me: the tension between the numbers=style/grade “presumption” (if you can call it that) and the principle that a product can bear more than one trademark. Think, for example, whether the numbers in the following designations are trademarks or mere style/grade designations: BMW 530, BOEING 767, MITCHELL 300. There are probably circumstances at which a number used in this manner becomes a separately protectable trademark, but I’ve never had the opportunity to research exactly where that line is drawn.

Federal Circuit holds HOTELS.COM generic and refuses registration

The Federal Circuit continued what some may consider a stubborn refusal to acknowledge how modern-day business is done over the Internet by holding the mark HOTELS.COM generic and refusing to allow it to be registered as a trademark.

In In re Hotels.com, L.P., No 2008-1429 (Fed. Cir. July 23, 2009), the applicant argued, to no avail, that it was not a hotel, but instead provided travel related information and travel agency services. The Federal Circuit thought that since a large part of those services involved hotels, the services were close enough to the name to be generic. The Federal Circuit also stuck by the PTO’s consistent policy that adding “.com” to a generic name doesn’t make the generic name into a trademark. For evidentiary reasons, the Federal Circuit also discounted several consumer affidavits and a survey for evidentiary showing that 76% of respondents thought HOTELS.COM was a brand.

Some (maybe a lot) may argue that this decision ignores that Internet-savvy consumers may increasingly view designations in the form “product category.com” as brand names for services facilitating commerce in that product category. But the question may not be ripe for reconsideration by the en banc court until presented in a case avoiding the evidentiary shortcomings identified in this one.

Fed. Cir. decision involving use of prosecution history in a trademark case

Be careful what you say to the PTO in trying to register your mark. The Federal Circuit’s recent decision in Aycock Engineering, Inc. v. Airflite, Inc., No. 2008-1154 (March 30, 2009), shows how prosecution history can sometimes be as dispositive in trademark disputes as it is in patent cases.

Airflite filed a petition to cancel Aycock’s registration for AIRFLITE for the service of “arranging for individual reservations for flights on airplanes.” The key issue was whether Aycock ever “used” the mark. If not, bye-bye registration. This required construction of the meaning of the service Aycock identified in the registration.

The prosecution file showed a lot of back-and-forth between the PTO and Aycock, in the course of which Aycock made several representations about the nature of the service. These representations made clear that Aycock’s service involved putting a traveler in touch with an air charter company with empty seats to fill.

Aycock took several steps towards getting his service off the ground, including signing up several air charter companies, and argued that this showed that he “used” the mark in commerce. The TTAB and Federal Circuit disagreed. Using Aycock’s own prosecution history statements against him to construe the meaning of the identified services, the TTAB and Federal Circuit held that “use” required, in this context, that Aycock have at least tried to have signed up a traveler or two. Signing up air charter companies was merely a step towards offering the service, but didn’t constitute the service itself, which required a traveler as well as a plane. Because there was no evidence that Aycock ever actually offered the service to the traveling public, the registration was canceled.

October TM Case Roundup

There have been a number of circuit court decisions involving trademark law in the past month, but I haven’t been as current as I should have been in reporting them. So here are the thumbnail sketches on the October roundup:

Federal Circuit Nixes Trademark Damages in Patent Case as “Impermissible Double Recovery” – In Aero Products Int’l, Inc. v. Intex Recreation Corp., No. 05-1283 (Fed. Cir. Oct. 2, 2006), the Federal Circuit used Federal Circuit law, not regional circuit law, in determining that, where “damages flow from the same operative facts,” a recovery for trademark infringement as well as for patent infringement is an impermissible double recovery. In that case, the court held that the operative facts were “sales of the infringing mattresses.” To me, this seems like a really broad-brush holding. What about the value added to the sales of the infringing mattresses by using a confusingly similar mark? What about damage to the company’s goodwill? What about damages for possible remedial advertising? And who knows what other potential types of damage can crop up despite the fact that the “operative facts” of the case revolve around “sales of infringing _______.” Once again, the Federal Circuit issues a shaky decision on trademark law.

Ninth Circuit Decides Case Involving Priority & “Tacking” Issues; Court Also Holds that the “Innocent Prior User” Defense of 15 U.S.C. § 1115(b)(5) Does NOT Require that the Junior Use be in a Geographically Remote Area – In Quicksilver, Inc. v. Kymsta Corp., No. 04-55529 (9th Cir. Oct. 6, 2006), the priority/tacking issue was very fact-specific and therefore had no earth-shattering legal pronouncements. In holding that the defendant innocently adopted and used its allegedly infringing mark before the plaintiff registered its mark, the Ninth Circuit held that § 1115(b)(5) doesn’t have the same “geographic remoteness” element that the common law has. There’s apparently a split in the circuits on this, the 9th and the 4th Circuits say no remoteness required; the 6th has required geographic remoteness, and Professor McCarthy agrees.

Ninth Circuit Holds that “Progressive Encroachment” Does Not Preclude a Laches Defense Where the Defendant Did Not Change the Mark to be More Similar and Where the Defendant’s Increased or New Sales Simply Represented “Normal Business Growth” – In Tillamook Country Smoker, Inc. v. Tillamook County Creamery Ass’n, No. 04-35843 (9th Cir. Oct. 11, 2006), the Ninth Circuit faced a pretty egregious case of laches and estoppel. The plaintiff tried to wriggle out of it by pointing to “progressive encroachment” doctrine. Under this principle, laches can be excused if the defendant changes its business significantly so as to make the likelihood of confusion much greater. This typically is shown by pointing to changes in a mark to make it more similar, or changes in products or retail outlets that bring the defendant closer to what the plaintiff does. In this case, the 9th Circuit held that where a defendant’s changes are simply natural business growth, progressive encroachment doesn’t apply, and a lazy plaintiff is out of luck.

Federal Circuit Decides that the Name Given to a Seed Varietal in a PVP Certificate Can’t Later be Registered as a Trademark Because, by Definition, It’s Generic – The court suggested that a way around this is to have two names for it: one generic and one the brand name. See In re Pennington Seed, Inc., No. 06-1133 (Fed. Cir. Oct. 19, 2006).

Sixth Circuit Upholds Summary Judgment that Hummer Grille Design and Overall Appearance Is Protectible and Infringed – In General Motors Corp. v. Lanard Toys, Inc., No 05-2085 (6th Cir. Oct. 25, 2006), the GM sued a toy maker over a toy car that looked like a HUMMER, alleging that it infringed its registered grill design trademark and the overall (unregistered) trade dress of its HUMMER vehicle. The Sixth Circuit had not trouble upholding summary judgment that the grill design mark was infringed. The trade dress issue presented more problems, but the Court ultimately upheld summary judgment that the trade dress was non-functional, had secondary meaning, and was infringed. In its analysis, there were two noteworthy points. First, the 6th Circuit held that GM adequately described the trade dress when it described the trade dress it sought to protect as “the exterior appearance and styling of the vehicle design which includes the grille, slanted and raised hood, split windshield, rectangular doors, squared edges, etc.” Second, the 6th Circuit refused to preclude two secondary meaning surveys that were conducted several years after infringement began. While not questioning that secondary meaning is to be judged at the time infringement begins, the 6th Circuit nevertheless refused to issue a blanket rule that post-infringement surveys are irrelevant. It noted that it didn’t want to issue a rule that would have the effect of excluding such a potentially probative tool in the vast majority of cases, and said that district courts could assess whether to reduce the probative value to give a post-infringement secondary meaning survey by considering the amount of time between the infringement start date and the date of the survey.

Seventh Circuit Chastises Parties and District Court for Treating a Trademark Settlement Agreement as Though It Were a Consent Judgment – This decision shows what trouble, confusion, and expense can occur when the parties don’t follow rule 65(d) to the letter. If parties to a trademark suit (or any other kind of suit) want their settlement to be enforceable as a court order (i.e., as a consent judgment rather than as a private settlement agreement) Rule 65(d) requires that the judgment itself be specific and that its directives not refer to or incorporate terms from other documents. In Blue Cross and Blue Shield Ass’n v. American Express Co., No. 05-4004 (7th Cir.Oct. 30, 2006), the district court and the parties thought American Express’s agreement that it wouldn’t use the term BLUE as a trademark was a consent judgment. But it wasn’t. It was a regular settlement agreement. The only order the district court entered was an order dismissing the case and saying that it retained jurisdiction to enforce the agreement. This problem resulted in the appeals court ordering multiple briefs on jurisdiction and, generally, a lot of time and money being needlessly spent. As the court dryly noted about the lawyers’ inattention to this problem: “If these lawyers were physicians, their patients would be dead.” (The specifics of the 7th Circuit’s resolution of whether AmEx complied with the agreement aren’t really significant.)

Federal Circuit Addresses Genericism, Descriptiveness, and Acquired Distinctiveness

In the recent Federal Circuit decision in In re Steelbuilding.com, No. 04-1447 (July 11, 2005), the Federal Circuit held that the TTAB erred in holding the mark STEELBUILDING.COM generic. In a decision that provides a helpful roadmap for future cases (particular for "________.com" marks), the Court held that the Board described the genus wrong, made its decision on too little evidence, and gave too short shrift to the effect of the ".com" TLD portion of the asserted mark.

Unfortunately for the applicant, the Federal Circuit did uphold the Board's decision that the mark was merely descriptive and, over a dissent, that it lacked secondary meaning. Curiously, the majority didn't even mention much of the evidence in the record that Judge Linn's dissent thought required a vacatur of the Board's finding of no secondary meaning. It's frustrating when a dissent mentions evidence in a record that it thinks requires a contrary result, yet the majority doesn't even deign to say why that evidence didn't require a different result from the one it reached. That situation makes it hard to figure out how to use the decision as precedent in future disputes.

Blogger ate my homework

Haven't posted in a while, but tried to last week. Unfortunately, as I clicked "Publish Post," Blogger croaked. All was lost. This "Retrieve Post" stuff? Didn't work. So herewith, below, are overly simplistic and only marginally humorous synopses of some recent decisions for the attention-span impaired. As you will see, it wasn't a good month for owners of what they thought were trademark rights or copyrights:

• What parts of the graphic and user interface of a video golf game are protectible under trade dress and copyright law? None, that's what, sez the 7th Circuit in Incredible Technologies, Inc. v. Virtual Technologies, Inc., No. 03-3785 (March 15, 2005).

• How about part numbers and part drawings in a transmission parts catalog? Protectible under copyright law? Nope, quoth the 6th Circuit in ATC Distribution Group, Inc. v. Whatever It Takes Transmissions & Parts, Inc., No. 03-6505 (March 30, 2005).

• OK, what about a last name registered as a trademark under German law? Out of luck in Murica, says the Federal Circuit in In re Rath, No. 04-1419, -1420 (March 24, 2005).

• I don't own the copyright, but I have an assignment of all causes of action from the copyright owner, so I can sue, right? Wrong, according to the en banc 9th Circuit in Silvers v. Sony Pictures Entertainment, Inc., No. 01-56069 (March 25, 2005).

• I've got a jury finding of intentional trademark infringement. Pretty exceptional, huh? I get fees, don't I? Well, don't I?? Nope. Intentional doesn't mean the same thing as willful, says a panel of the 9th Circuit, apparently deciding the case without their Roget's Thesaurus. Watec Co. v. Liu, No. 03-55823, -56079 (March 30, 2005).

• Hey! There's a guy using my trademark for the domain name of a web site where he says rotten things about me. Doesn't trademark law prohibit that? Not if he's just griping. That's not "use in connection with the sale of goods," as required under the Lanham Act, but you might have a beef under the Anticybersquatting Act. Bosley Medical Inst., Inc. v. Kremer, No. 04-55962 (9th Cir. April 4, 2005).

• Finally, the 8th Circuit held that (a) a bankruptcy court order approving the sale of assets, including "all intellectual property," was a valid transfer of ownership in copyrights, (b) an appellate court should review a district court's finding of "substantial similarity" under the clearly erroneous standard, not de novo (a bad sign for the appellant in the case), and (c) no jury trial for plaintiffs who drop their damage claims prior to trial. Taylor Corp. v. Four Seasons Greetings, LLC, No. 04-1088 (April 11, 2005). (Hard to do anything flip with that decision -- sorry.)