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Trademark owners and their counsel should take note of a recent article in the September 1st INTA Bulletin which highlights the growing willingness of the U.S. Trademark Trial & Appeal Board (“TTAB”) to entertain claims for fraud on the USPTO.
Specifically, the article discusses the adoption of a new “bright line” test for fraud on the USPTO. Under the test, a applicant is presumed to have committed fraud on the PTO for including in the specification of goods or services particular products or services on which the trademark is not actually used. This same rule is applied to Section 8 and 15 filings and Section 9 renewals.
The seminal case in this regard is Medinol Ltd. v. Neuro Vasx Inc., 67 U.S.P.Q.2d 1205 (T.T.A.B. 2003) in which the Board wrote:
Most importantly, however, deletion of the goods upon which the mark has not yet been used does not remedy an alleged fraud upon the Office. If fraud can be shown in the procurement of a registration, the entire resulting registration is void. General Car and Truck Leasing Systems, Inc. v. General Rent-A-Car Inc., 17 USPQ2d 1398, 1401 (S.D. Fla. 1990), aff’g General Rent-A-Car Inc. v. General Leaseways, Inc., Canc. No. 14,870 (TTAB May 2, 1998). Allowing respondent’s amendment would be beside the point; even if “stents” were deleted from the registration, the question remains whether or not respondent committed fraud upon the Office in the procurement of its registration.
Interestingly, most of these decisions have been designated as non-citable by the TTAB, which is somewhat curious given the recent increase in decisions based on fraud on the USPTO.
Important for trademark owners to note is that the remedy most often applied by the TTAB is cancellation of the entire registration – including for the goods on which the mark is actually used. The TTAB has apparently taken the position that such fraud on the PTO is so grievous an act that the only viable deterrent to such conduct is the threat of cancellation of the entire registration.
Thus, if a trademark owner obtains a registration for MARK Z for pharmaceutical preparations for the treatment of cardiovascular diseases and conditions, diabetes, cancer and respiratory diseases and conditions, but the owner is only using the mark for cardiovascular drugs, the entire registration for MARK Z could be cancelled by the TTAB. In a world where global trademarks are vital for most multi-national companies, this risk is quite serious.
Some practitioners have raised questions about how far the TTAB will take this doctrine. They ask, “Will fraud be found if an applicant fails to disclose third parties’ use of similar marks, mistakenly claims an incorrect date of first use or uses an old or otherwise incorrect specimen?”
In my opinion, failure to disclose use of a similar mark by a third party should not result in a finding of fraud. As likelihood of confusion (the similarity of two marks) is a subjective standard and the test for which has 13 factors, it would be difficult for the Board to conclude that the applicant has committed fraud – especially since the Examining Attorney conducts her own search for similar marks.
However, the submission of old specimens or submitting an incorrect date of first use may be another story since that is information that is exclusively in the possession of the applicant, much the same way that the goods on which a mark is used is also within the sole control of the applicant. Therefore, I would not be surprised if failure to disclose an accurate first use date or knowingly submitting an “old” specimen to support ongoing use results in a finding of fraud.
Therefore, trademark owners should carefully evaluate their portfolios and if they own U.S. registrations that are over-inclusive, they should consider promptly filing amendments to their registrations to accurately reflect only the goods on which they are using their marks.
Links to other decision in which the TTAB had presumed fraud occured and ordered cancellation of the registrations include:
Physicians Formula Cosmetics, Inc. v. Cosmed, Inc., Cancellation No. 92040782 (T.T.A.B. 2005) (not published)
If you have any questions or would like assistance with the above, please do not hestitate to contact us.