IP Law Daily TTAB erred in disregarding ‘fame’ of cancellation petitioner’s mark in confusion analysis
Wednesday, May 24, 2017

TTAB erred in disregarding ‘fame’ of cancellation petitioner’s mark in confusion analysis

By Thomas Long, J.D.

In its denial of a petition to cancel a registration for the mark ALEC BRADLEY STAR INSIGNIA, for cigars and cigar products, on likelihood of confusion grounds, the Trademark Trial and Appeal Board erred in giving no weight to the "fame" of the petitioner’s registered mark INSIGNIA, for wine, the U.S. Court of Appeals for the Federal Circuit has held. The Board erroneously analyzed the fame of INSIGNIA wine as an all-or-nothing factor and failed to properly apply the totality of circumstances standard, which requires consideration of all relevant factors on a sale appropriate to their merits. The court vacated the Board’s decision and remanded the case for reconsideration (Joseph Phelps Vineyards, LLC v. Fairmont Holdings, LLC, May 24, 2017, per curiam).

Cancellation petitioner Joseph Phelps Vineyards, LLC ("Vineyards") began producing wines bearing the INSIGNIA mark in 1978. In 2012, respondent Fairmont Holdings, LLC ("Fairmont") obtained a federal registration for ALEC BRADLEY STAR INSIGNIA for cigars and associated products. Vineyards filed a petition to cancel Fairmont’s registration. In analyzing the likelihood of confusion between the parties’ marks, the Board considered the du Pont factors, including the fame of Vineyards’ INSIGNIA mark. The Board stated that "while it appears that Petitioner’s INSIGNIA branded wine has met with success in the marketplace, we are not persuaded on this record that Petitioner’s mark is a famous mark." The Board found that the du Pont factors weighed in favor of Fairmont and denied the petition for cancellation. Vineyards appealed to the Federal Circuit.

The court noted that the Board had acknowledged that a mark is "famous" for likelihood of confusion purposes if a significant portion of the relevant consuming public recognizes the mark as a source indicator. The proper standard for evaluating fame in this context was the class of customers and potential customers of the products sold by the mark owner, not the general public.

The Board erroneously applied an all-or-nothing measure of fame that was more akin to the standard properly applied in trademark dilution cases, the court said. Although fame for purposes of dilution is an "either/or proposition"—that is, fame either does or does not exist—fame in the likelihood of confusion analysis was to be measured "along a spectrum from very strong to very weak."

Vineyards provided evidence that INSIGNIA wine was well known in the wine market and among consumers of fine wine. INSIGNIA wine had received acclaim in the media, including highly positive coverage in "Wine Spectator," "Food and Wine," and other prominent publications. INSIGNIA wine had been served at the White House on several occasions.

"We are perplexed at the Board’s finding that INSIGNIA wine has no ‘fame,’ giving no discernable weight to this factor," the court said. The Board failed to examine the mark’s fame from the perspective of the relevant consumers. In the court’s view, the record indicated that the du Pont factor of "fame" deserved considerable weight, among the totality of circumstances. Therefore, the Board’s decision to deny the cancellation petition was vacated, and the case was remanded for redetermination using the correct standard.

Concurring opinion. While concurring in the decision to vacate and remand, Circuit Judge Pauline Newman wrote separately to address two additional issues that she felt warranted review. First, Judge Newman asserted that the Board, in its analysis of the "relatedness" du Pont factor, did not fully consider all aspects of the factor, despite noting that relatedness can be based on use of the same mark in connection with the products at issue, complementarity of the products, or simultaneous consumption. The Board had found that the evidence indicated that the parties’ goods were sold in the same trade channels to the same purchasers. This, in Judge Newman’s opinion, suggested a degree of relatedness that merited further exploration. Second, the Board erred in failing to consider the form of Fairmont’s actual use of its registered mark, according to Judge Newman. Judge Newman stated that, although Fairmont’s registration was in standard-character format, the manner in which it was actually used in the marketplace should have been given appropriate weight in the Board’s likelihood of confusion analysis.

The case is No. 2016-1089.

Attorneys: Thomas Schneck (Law Offices of Thomas Schneck) for Joseph Phelps Vineyards, LLC. Kimberly Kolback (Law Office of Kimberly Kolback) for Fairmont Holdings, LLC.

Companies: Joseph Phelps Vineyards, LLC; Fairmont Holdings, LLC

MainStory: TopStory Trademark FedCirNews

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