Availability Opinion « Trademark Law Litigation

March 3, 2009

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Abandonment of a mark :

Abandonment occurs when the trademark owner stops using the mark with no intention to resume using it. Use of a mark in this context means the bona fide use of the mark made in the ordinary course of trade, and not made merely to reserve a right in a mark. Nonuse for three consecutive years is prima facie evidence of abandonment. Furthermore, failure to police and enforce a mark can lead to abandonment if the trademark owner is deemed to have impliedly consented to confusingly similar uses of the mark. If abandonment occurs, all rights in the mark cease.

Acquiescence :
The failure to take action against infringing parties, or otherwise indicating, implicitly or explicitly, that nothing will be done about the infringing action. Acquiescing can lead to abandonment of trademark rights.

Action (or Office Action) :

A written communication sent by the Examining Attorney from the U.S. Patent and Trademark Office, requesting a response from the applicant regarding some matter pertinent to a pending application for trademark registration.

Actual confusion :

This occurs when an actual consumer is in fact confused as to the source of goods based on confusingly similar uses of a trademark. Actual confusion is not required to prove infringement of a mark, although it is highly probative as evidence that the mark is likely to cause confusion.

Advertising, comparative :

The use of a competitor’s trademarks in advertising. Such use is permitted in the context of comparing a company’s own products or services with those of their competitor, as long as the ad creates no confusion as to source or dilution of the competitor’s marks.

Advertising injury :

This is a category of harm sometimes caused by trademark infringement. The significance is that some insurance policies cover litigation of a trademark dispute to the extent that the dispute falls within an advertising injury.

Aesthetic functionality :

A widely-criticized facet of the functionality doctrine which deems as functional, and thus not trademarkable, any product design feature which is an important ingredient in the commercial success of the product. Thus, if a floral pattern on china makes the china more commercially desirable, such pattern would be deemed non-trademarkable. More recently, courts have recognized that a design feature may be commercially successful and still operate as a product identifier worthy of trademark protection, and thus have not been eager to invoke the doctrine of Aesthetic functionality as a defense to trademark infringement.

Affirmative defenses :

These are defenses to a complaint for trademark infringement that must be pled in the defendant’s answer, or else they are waived. Examples include Fraud, Unclean hands, Misuse, First Amendment, Acquiescence, Fair use, Genericness, Abandonment, Laches, and Estoppel.

Affixation Requirement :

One of the elements that must be present in order to demonstrate that a mark is used in commerce, which is the fundamental requirement for the acquisition of rights in a mark. For a trademark to be “affixed” to goods, the mark should ideally be either placed on the goods themselves, or on their containers or attached tags or labels. The affixation requirement for goods may also be satisfied if the mark is prominently featured on a conspicuous display associated with the goods. If none of the above are practicable, the mark may be used on documents associated with the sale of the goods as a last resort. For services, a trademark is “affixed” if it is used in the sale or advertising of the services, as long as it is used in direct and explicit reference to the services provided.

Alternative dispute resolution (ADR) :

A formalized mechanism by which legal disputes can be settled outside of formal litigation. ADR may consist of mediation, arbitration or binding arbitration. In typical cases, ADR is a lot quicker and less costly than full-blown litigation. However, that may not always be true in trademark litigation where the plaintiff oftentimes succeeds in petitioning the court for emergency intervention and a speedier court docket. Moreover, because ADR eliminates many of the formalities offered by courts as required under constitutional principles of due process, it is not uncommon for participants of ADR to feel as though they were not sufficiently heard. Whether or not ADR is desirable for a particular situation is highly case dependent, and both parties need to agree to be participants.

Amendment to Allege Use :

A special filing sometimes used for Intent to Use registrations in which the applicant amends the application to allege that the mark has in fact been used in commerce. The Amendment to Allege Use may be filed with the U.S. Patent and Trademark Office (USPTO) any time after filing the Intent to Use application, but before the USPTO sends a Notice of Publication stating that the Trademark Examiners have approved the mark and will publish it in the Official Gazette. Once publication occurs, the applicant must wait until after a Notice of Allowance issues from the USPTO before submitting a Statement of Use. A Statement of Use serves essentially the same purpose as the Amendment to Allege Use, except that the former cannot be filed before the Notice of Allowance, and must be filed within six months thereof. The USPTO requires an additional filing fee of $100 to submit either an Amendment to Allege Use or a Statement of Use.

Anti-Dilution statutes :

State and federal statutes that allow the owner of a famous trademark to prevent uses of its mark by other companies in such a way as to tarnish or blur the distinctiveness of the mark. Unlike lawsuits under a traditional trademark infringement lawsuit, the plaintiff in a dilution suit need not prove that there is a likelihood of confusion between the famous mark and the challenged mark.

Arbitrary marks :

These are names that exist in popular vocabulary, but have no logical relationship to the goods or services for which they are used. The pairing of the mark with the particular category of goods or services should appear to be random. Examples include APPLE for computer, BEEFEATER for gin, COMET for kitchen cleaner, and JAGUAR for a car. Whether a word is arbitrary or not has everything to do with the context in which it is used. Obviously, the term “apple” used to sell a rounded edible pome fruit of a tree is a generic term, and not trademarkable. Similarly, use of the phrase “Comet Watch” for a newsletter describing the activities of celetial bodies with long tails pointing away from the sun would not be considered arbitrary, but rather descriptive or suggestive.

Arbitration :

A form of alternative dispute resolution in which an authorized individual sits as the arbiter of a legal dispute in lieu of a formal judicial proceeding. Arbitration may be binding or non-binding, depending on the agreement of the parties. Even if arbitration is binding, appeals to a district court can still be made in some cases. Very often, arbitration tends to be less formal, less expensive and faster. However, courts in a trademark infringement or dilution case can often hear a motion for temporary injunction very quickly as well, if all the requirements for a temporary injunction are met.

Assignee :

The party to whom a trademark is being transferred in an assignment.

Assignment of trademark :

An assignment is the legal transfer of ownership of any property such as a trademark or copyright from the owner to another party, who then becomes the new owner. The “assignee” is the person who acquires ownership, and “assignor” is the person who transfers ownership rights. To be effective, a trademark assignment must include the transfer of the goodwill accrued in the assigned mark beyond mere assignment of the mark itself. Traditionally, courts have required the transfer of tangible assets along with the mark such as plant inventory, or product formula or know-how. However, more recently some courts have taken a more liberal view of assignments and do not require the transfer of such tangible assets. However, the assignee must continue to sell goods or services of the same quality and nature as the assignor to ensure that goodwill has indeed passed with the mark. See PepsiCo, Inc. v. Grapette Co., 416 F.2d 285 (8th Cir. 1969). When a registered trademark is assigned, it is a good idea to record the assignment with the U.S. Patent and Trademark Office.

Assignment, in gross
Assignment of a mark without the necessary transfer of goodwill associated with the mark. Such assignments are invalid, and result in abandonment of the trademark. If so, the person to whom the mark was assigned will no longer have the benefit of the assignor’s earlier first use date to establish priority.

Assignor :

The party who is selling or otherwise transferring ownership of a trademark.

Assumed name :

Also known as a trade name or corporate name, it is the name under which a company conducts its business. Whereas an assumed name identifies the business itself, trademarks identify goods or services. An assumed can also be a trademark if it meets the requirements of a trademark. If so, the assumed name also merits protection under state and federal trademark and dilution laws. However, an assumed name has no exclusive trademark rights unless it is used as a trademark. This is so, even if the name is registered with the appropriate state body regulating business names, usually the Secretary of State.

Attorney-client privilege :

The legal protecting arising out of the communication of a client with his or her attorney. This privilege cannot be waived except by the client. Thus, the attorney is legally obliged to keep secret any information told to him or her by the client, unless the client waives that right, or else in certain limited and rare circumstances.

Attorneys’ fees :

In most cases, the losing party to litigation under the Trademark Act does not have to pay the legal fees of the prevailing party. However, the Lanham Act governing trademark infringements allows for the payment of attorneys’ fees in exceptional cases, such as those involving egregious, bad faith and willful infringement by the defendant. Lawsuits brought only under the common law normally do not award attorneys fees even when there is such bad conduct on the part of defendant.
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Availability opinion (Clearance opinion) :

The legal opinion provided by an attorney to a trademark owner or prospective trademark owner that identifies the legal risks associated with using a particular trademark. Such risks might include, for example, the possibility of infringing or diluting an existing mark and hence being sued, and the likelihood that an application for trademark registration will be rejected. The legal opinion of an attorney can serve not only as immediate advice on the risks in adopting a given mark, but if the opinion is written, which most are, you may be able to deter companies appearing in the opinion from suing for infringement by showing them that at least one attorney has already decided the marks are not confusingly similar. It is important to note, however, that while attorneys are trained to be objective, the inherent subjectivity of trademark law suggests that a second legal opinion is a very good idea if there is any question about the availability of a mark or about conflicts between marks.

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Cancellation of trademark (cancellation proceeding) :

A federal trademark registration may be canceled by a court in a civil action, or by the U.S. Patent and Trademark Office in a cancellation proceeding. The grounds for cancellation of a mark include; the mark is likely to cause confusion with a prior mark, it is descriptive of the underlying goods or services, or that the mark is generic.

Causes of Action for Trademarks :

When there is a conflict between marks, there are several types of lawsuits which could be brought including: Trademark infringement in violation of section 32 of the Lanham Act, 15 U.S.C. § 1114; False designation or description in violation of section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a); Trademark dilution in violation of section 43(c) of the Lanham Act, 15 U.S.C. §1125(c); Violation of state trademark infringement statutes; Common law trademark infringement; Violation of state unfair competition and deceptive practices statutes; Common law unfair competition; and Common law or state statutory violations of the right of publicity.

Cease and desist letter :

A letter sent by a trademark owner demanding that another company immediately halt using its trademark. These letters are typically accompanied with a threat of a lawsuit if the alleged infringer does not immediately halt use. Before sending such a letter, it is vital that the initiator be 100% certain their rights in the mark are prior to the alleged infringer’s rights. Otherwise, it may be the initiator who must cease use.

Certification mark :

A symbol used to identify goods or services that meet certain criteria such as quality ratings or content levels. Typically, a system of rating is established by an independent organization, and the symbol is then licensed to approved manufacturers or service providers. Examples include: the Good Housekeeping Seal of Approval, the , and the Real symbol used on dairy products.

Class, international :

A designation required on all federal trademark applications that identifies the kinds of goods or services for which a particular mark will be used. This information is available for those searching for prior uses of a mark prior to adopting it. A good search strategy is to broaden the scope of the search for those classes in which the proposed mark may potentially belong. The $245 application fee for a federal registration includes registration for only one international class. Additional classes can be added at a cost of $245 per class.

Clearance Opinion (Availability Opinion) :

Coined terms (Fanciful terms) :

These are terms that are invented for the sole purpose of serving as trademarks. Examples include CANNON for photographic equipment, UNIX for a computer operating system, LOTTO for shoes, and TOSHIBA for photocopying equipment. Coined marks receive the highest level of protection, because a coined word has no known meaning and therefore has no possible association with the good or service for which it is used. As a result, infringers of these marks are hard pressed to provide any plausible explanation for their use the mark, leaving the impression that the real reason was in fact a blatant attempt to trade off the goodwill generated by the owner of the trademark.

Collective mark :

A symbol used by members of a group to identify their association with the group, such as a union, co-op and trade or professional associations.

Colors, protection of :

Colors, whether one or a combination of them, can be protected under trademark law if the colors otherwise meet the definition of a trademark. In a 1995 case, Qualitex v. Co. v. Jacobson Prods. Co., 514 U.S. 159, the Supreme court rejected earlier lower court decisions that had refused to protect colors as trademarks. Those earlier decisions claimed that businesses would soon deplete the limited supply of colors available, and unfairly prevent others from entering the marketplace, thus creating an undesirable monopoly. The Court in Qualitex pointed out that there are innumerable shades of colors available, thereby rejecting the depletion of colors theory.

Combined application :

An application for trademark registration containing multiple international classes. Each class costs $245 to register, although all the classes can be applied for on one application.

Commissioner :

The Commissioner of Patents and Trademarks in the United States Patent and Trademark Office. At the time of this writing, that position is held by Bruce Lehman.

Common law :

Law originating from court decisions and refined through prior court precedents, as distinguished from law created by the legislative branch of government such as statutes. Common law is also referred to as court-made law.

Comparative advertising :

Comparative advertising is the use of another company’s trademark in order to compare that company’s products with its own. Whether or not comparative advertising qualifies as trademark infringement or dilution is governed by those bodies of law. If, for instance, an ad does not carefully delineate the competitor’s mark from its own, and thereby creates a likelihood of consumer confusion, then the use of the mark is infringing. But, where there is no consumer confusion, or dilution, direct claims about another company’s product are allowed (if the claims are true, of course). For example, Hudson Pharmaceutical Co. was allowed to copy certain elements from the package and label of METAMUCIL, and to state that its own product, REGACILIUM, was equivalent to METAMUCIL. However, Hudson was required to print the word “equivalent” in at least as large of letters as the mark METAMUCIL, to place a ® next to the term METAMUCIL, and to state that METAMUCIL was made by G.D. Searle and that Searle did not make or license REGACILIUM. G.D. Searle & Co. v. Hudson Pharm. Corp., 715 F.2d 837, 839 (3rd Cir. 1983). Similarly, SECOND CHANCE perfume was allowed to state in its materials that it was equivalent to CHANEL No. 5 perfume. Smith v. Chanel, Inc., 402 F.2d 562, 563 (9th Cir. 1968).

Concurrent use :

Use by two or more persons of the same mark in connection with the same or similar products or services, usually limited by geographic boundaries.

Concurrent use proceeding :

An administrative process governed by the Trademark Trial and Appeal Board in which the Board reviews an application for a concurrent use registration, and sends notice to the party identified in the application that their the rights in their mark may be limited as set forth in the application. The non-applicant party has forty days to answer, otherwise the limitations specified in the concurrent use application will be entered as a judgment.

Concurrent use registration :

A federal registration which delineates certain limitations on the use of a mark due to the concurrent use of a similar mark. Generally speaking, the first of two companies to use a mark is entitled to nationwide registration rights, except for the specific geographic area in which the second company is using the mark, even if the first user has not used the mark nationwide. If the second user is the first to register, then the second user is the one that receives nationwide registration subject to the first user’s geographic region. Concurrent users may agree to leave open certain regions permanently or else long enough for one or the other to begin actual use in that region.

Conflicts between trademarks :

Conflicts between trademarks can occur due to two marks being similar to each other in such a way that consumers are likely to be confused as to which is which. The result of a conflict can lead to one side abandoning their rights rather than fight, or may lead to negotiation, arbitration, mediation, or a lawsuit. There are several different theories of law (causes of action) that relate to trademarks.

Confusion (Confusingly similar) :

This is the legal standard that defines whether or not trademark infringement has occurred, or whether or not a trademark registration can be issued. Click here for more information on what constitutes confusingly similar.

Constructive notice :

Constructive notice is a legal fiction. In the context of proving good faith as a defense in a trademark infringement lawsuit, constructive notice replaces the requirement that the defendant have actual knowledge of plaintiff’s prior use of a mark. Thus, instead of having actual knowledge, bad faith is said to exist.

Constructive use :

Where use of a trademark is deemed to have occurred even without actual use, pursuant to a statute. The legal effect is the same as if there were actual use.

Copyrights :
Ownership rights in expressive works (not ideas), granting the owner exclusive control over distribution, display, copying, performance, and adaptation of those works. The Copyright Office is the umbrella of the Library of Congress that governs the registration of copyrighted works.

Corporate name :

Also known as a trade name or trade name, it is the name under which a company conducts its business. Whereas a corporate name identifies the business itself, trademarks identify goods or services. A corporate name can also serve as a trademark if it meets the requirements of a trademark. If so, the corporate name also merits protection under state and federal trademark and dilution laws. However, a corporate name has no exclusive trademark rights unless it is used as a trademark. This is so, even if the name is registered with the appropriate state body regulating business names, usually the Secretary of State.

Correcting mistakes in a registration (Amendments) :

The USPTO permits trademark owners to modify certain information on an existing trademark registration for a filing fee of $100.

Costs, as a measure of damages for infringement :

Court costs can be recovered by the prevailing party as a matter of course, unless the court directs otherwise. This includes filing fees, court reporter fees if necessary to use transcripts in the case, printing and witness fees, and compensation for court-appointed experts. What constitutes a prevailing party is not always obvious. The plaintiff need not win on all claims to recover costs as the prevailing party. Sometimes the defendant may recover costs, as for instance if the case is dismissed with prejudice. Some statutes provide specifically for award of attorneys’ fees as costs, such as in the Racketeer Influenced and Corrupt Organizations Act. 18 U.S.C. §1926(c).

Costs, for trademark legal services :

Costs will obviously vary based on what services you need.

Counterfeit Goods:

Goods bearing a trademark that is either identical with, or substantially indistinguishable from, a federally registered mark. While infringement of a trademark requires confusing similarity between marks, regardless of the intent of the infringer, counterfeiting can only occur when the perpetrator knowingly used the counterfeit mark with an intent to traffic in the goods bearing such mark. Trafficking in counterfeit marks may be a criminal offense, and can lead to treble damages when pursued in a civil court. The U.S. Customs Bureau and the International Trade Commission can help trademark owners stop the importation of counterfeit goods into the United States.

CTM (European Community TradeMark)

An international treaty providing for “one-stop” trademark registration for all European Union country members. As of yet, trademarks continue to be governed by each individual European country’s laws, and there is no harmonization of laws.

Customs Bureau, role in trademarks :

U.S. Customs officials can demand disclosure of the identity of any trademark on imported goods, and under certain circumstances, seize goods bearing infringing marks. Congress has authorized Customs Bureau involvement in preventing the importation of counterfeit goods, gray-market goods and goods bearing infringing trademarks. Such goods can be seized at the border. However, what happens to them after seizure depends on which category they fit into. Counterfeit goods will be destroyed or given to charity after removal of the trademark. Infringing marks will be sent back to the place of origin, or enter the U.S. after removal of the mark. Or, upon consent of the U.S. trademark owner, counterfeit goods or goods bearing infringing marks may enter the U.S. In order for the Customs Bureau to take action at the border, the U.S. trademark owner will have to record with Customs their federally registered mark (or trade name if used for six months). Additionally, trademark owners typically have to alert Customs of specific counterfeit or infringing activity, just as a practical matter, since Customs has far too many trademarks to effectively monitor without such assistance. For more information, visit the US Customs site at http://www.customs.ustreas.gov/imp-exp2/ipr/iprbroch.htm

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