MATTHEW F. LEITMAN, UNITED STATES DISTRICT JUDGE
This is a trademark dispute over the mark "WorkWire" (the "Mark"). Defendant/Counter-Plaintiff
In a prior Opinion and Order addressing the parties' cross-motions for summary judgment, the Court ruled that Kelly did not use the Mark in commerce before Creative Harbor filed the Creative ITUs and that Kelly thus does not have priority based on that alleged prior use. (See Opinion and Order, ECF # 62 at 2, Pg. ID 1631.) In that same Opinion and Order, the Court left open the issue of whether, as Kelly argues, Creative Harbor cannot establish priority based upon the Creative ITUs because Creative Harbor lacked a bona fide intent to use the Mark with respect to each of the goods and services identified in those ITUs. (See id. at 17-18, Pg. ID 1646-1647.)
The Court has now reviewed the parties' supplemental briefs on this issue, and it holds that (1) Creative Harbor had a bona fide intent to use the Mark on some, but not all, of the goods and services identified in the Creative ITUs and (2) the Creative ITUs are invalid and ineffective because Creative Harbor has not deleted from the ITUs each of the goods and services on which it lacks a bona fide intent to use the Mark. Accordingly, Kelly is entitled to summary judgment on Count IV of Creative Harbor's counterclaim to the extent that count alleges that Creative Harbor has priority in the Mark based upon its filing of the Creative ITUs.
The facts and procedural history of this action are set forth in detail in the Court's prior Opinion and Order (See id. at 2-9, Pg. ID 1631-1638.). The Court includes in this Opinion and Order only the additional facts and procedural history germane to the issues addressed herein.
The first of the Creative ITUs, filed under International Class 35,
(Services ITU, ECF # 1-13 at 2-3, Pg. ID 34-35) (emphasis in original.)
The second of the Creative ITUs, filed under International Class 9,
(Goods ITU, ECF # 1-14 at 2, Pg. ID 42) (emphasis in original.)
In its previously-filed motion for partial summary judgment, Creative Harbor argued that it had priority in the Mark based upon its filing of the Creative ITUs. (See Creative Harbor's Motion, ECF # 48 at 14-18, Pg. ID 785-89.) Kelly countered that the Creative ITUs were invalid and ineffective because Creative Harbor lacked a bona fide intent to use the Mark on all of the goods and services identified in those ITUs at the time Creative Harbor filed them. (See Kelly's Response Brief, ECF # 55 at 8, Pg. ID 1320.) At the same time the Court was considering the parties' arguments with respect to the validity of the Creative ITUs, the parties were contesting the same issue in front of the Trademark Trial and Appeal Board (the "TTAB").
After reviewing Creative Harbor's arguments and Kelly's response, the Court was uncertain as to whether it should rule on the validity of the Creative ITUs or whether it should defer such a ruling to the TTAB. Accordingly, the Court "direct[ed] the parties to file supplemental briefs addressing whether this Court should (1) decide the validity of the Creative ITUs or (2) leave that issue to the TTAB...." (See Opinion and Order, ECF # 62 at 19, Pg. ID 1648.)
Thereafter, counsel for both parties "conferred and determined that the Court should decide the validity of the Creative ITUs." (Stipulated Order, ECF # 64 at 1, Pg. ID 1651.) The parties entered into a stipulation to that effect, and, pursuant to that stipulation, the Court entered an Order providing that it would decide the issue. (See id. at 2, Pg. ID 1652.)
The parties have now filed supplemental briefs addressing Kelly's arguments that the Court should void the Creative ITUs because Creative Harbor lacked a bona fide intent to use the Mark on all of the identified goods and services. (See ECF ## 65 & 66.) Creative Harbor suggests that the Court approach the issue as if Kelly has moved for partial summary judgment on Count IV of its counterclaim. (See ECF # 65 at 2, Pg. ID 1661.) The Court accepts that suggestion and, for the reasons explained below, grants partial summary judgment in favor of Kelly on Count IV.
Prior to 1988, "the Lanham Act required that a trademark applicant already be using the mark in commerce at the time of the application's filing in order to qualify for trademark registration." M.Z. Berger & Co., Inc. v. Swatch AG, 787 F.3d 1368,
15 U.S.C. § 1051(b)(1).
In M.Z. Berger, the Federal Circuit recently addressed "what `bona fide intention' means under Section 1(b) of the Lanham Act." M.Z. Berger, 787 F.3d at 1375. The court explained that while the Lanham Act does not define the term "bona fide," an applicant's good faith intent to use the mark in commerce "must be [objectively] demonstrable and more than a mere subjective belief." Id. "In addition, an applicant's intent must reflect an intention to use the mark consistent with the Lanham Act's definition of `use in commerce': [T]he bona fide use of a mark in the ordinary course of trade and not made merely to reserve a right in the mark." Id. at 1376 (quoting 15 U.S.C. § 1127). Although the "evidentiary bar" to demonstrate an objective intent to use a mark in commerce "is not high, the circumstances must indicate that the applicant's intent to use the mark was firm and not merely an intent to reserve a right in the mark." Id.
Kelly urges this Court to hold as a matter of law that Creative Harbor "lacked a bona fide intent to use the Mark for at least several of the goods and services in each class of [the Creative] ITUs." (Kelly Supp. Br., ECF # 66 at 1, Pg. ID 1722.) This argument faces a significant preliminary hurdle because "[a]s a general rule, the factual question of intent is particularly unsuited to disposition on summary judgment." Copelands' Enterprises, Inc. v. CNV, Inc., 945 F.2d 1563, 1567 (Fed.Cir.1991). However, both the TTAB and federal district courts have granted summary judgment against an ITU applicant where the evidence plainly establishes that it lacked a bona fide intent to use a mark. See, e.g., Honda Motor Co. v. Winkelmann, 90 U.S.P.Q.2d 1660 (T.T.A.B. 2009); City of Carlsbad v. Shah, 666 F.Supp.2d 1159 (S.D.Cal.2009); Bobosky v.
As the party seeking summary judgment, Kelly bears the initial burden of identifying evidence that Creative Harbor lacked a bona fide intent to use the Mark. See Honda Motor Co., 90 U.S.P.Q.2d at 1663 (reviewing applicant's evidence of intent-to-use only after concluding that party seeking summary judgment had identified evidence that applicant lacked intent); Cf. Boston Red Sox Baseball Club LP v. Sherman, 88 U.S.P.Q.2d 1581, 1587 (T.T.A.B. 2008) ("Opposer has the initial burden of demonstrating by a preponderance of the evidence that applicant lacked a bona fide intent to use the mark on the identified goods.").
Kelly has made a substantial showing that Creative Harbor lacked a bona fide intent to use the Mark on all of the goods and services listed in the Creative ITUs. Kelly has identified sworn deposition testimony by Creative Harbor's CEO Christian Jurgensen ("Jurgensen") indicating that (1) in many respects, Creative Harbor "merely inten[ded] to reserve a right" in the Mark and (2) Creative Harbor lacked a firm intent to use the Mark with respect to several of the goods and services listed in the Creative ITUs. M.Z. Berger, 787 F.3d at 1376. Kelly directs the Court to the following representative portions of Mr. Jurgensen's testimony:
By identifying this deposition testimony, Kelly has carried its initial burden of showing that Creative Harbor did not have a bona fide intent to use the Mark on each and every one of the goods and services listed on the Creative ITUs.
Creative Harbor's response to Kelly's showing misses the mark. Creative Harbor cites substantial evidence that it did, in fact, have a bona fide intent to use the Mark on some of the goods and services listed on the Creative ITUs. (See Creative Harbor's Supp. Br., ECF # 65 at 7-8, Pg. ID 1666-67.) This evidence makes clear, for instance, that Creative Harbor had a "firm" intent to use the Mark in connection with an iPhone application that connected job seekers with employers. (See id.) But evidence that Creative Harbor intended to use the Mark with respect to some of the goods and services listed in the Creative ITUs does not contradict Kelly's evidence that Creative Harbor lacked a firm intent to use the Mark on several of the other services and goods listed in the ITUs. And, critically, Creative Harbor has not identified any objective evidence that it had a bona fide intent to use the Mark in connection with many of services and goods listed on the Creative ITUs, such as employee relations information services, business consulting services, professional credentialing verification services, computer game software, and/or computer hardware for integrating text and audio. There is simply no material factual dispute as to whether Creative Harbor had a firm intent
The Court thus turns to the appropriate remedy to be applied where, as here, an ITU applicant has a bona fide intent to use a mark on some, but not all, of the goods and/or services listed in an ITU.
There is no mystery as to what happens when, at the time of filing, an ITU applicant has no bona fide intent to use its mark in commerce on any of the goods or services listed in its application: the ITUs are deemed ineffective and the applicant is barred from registering the mark. See, e.g., Honda Motor Co., supra; L.C. Licensing, Inc. v. Cary Berman, 86 U.S.P.Q.2d 1883 (2008). Less clear is what happens if an applicant, like Creative Harbor in this case, has a bona fide intent to use a mark in commerce on some, but not all, of the listed goods and/or services.
Kelly says that such an application is void ab initio in its entirety and that the applicant may not register the mark (via that application) with respect to any of the goods or services listed on the application. (See, e.g., Kelly Supp. Br., ECF # 66 at 1, Pg. ID 1722.) But the decisions of the TTAB — which are persuasive in this context, see, e.g., Gruma Corp. v. Mexican Restaurants, Inc., 497 Fed.Appx. 392, 396 n. 1 (5th Cir.2012) (citing cases) — do not support such an unforgiving rule. While the relevant decisions of the TTAB could certainly be clearer and could include more comprehensive analysis, they establish the following rule: absent fraud, an ITU applicant may cure an overbroad listing of goods and/or services by deleting from its application the goods and/or services on which it lacks a bona fide intent to use the mark.
The leading TTAB decision addressing an overbroad listing of goods and/or services in an application to register a trademark appears to be Grand Canyon West Ranch LLC v. Hualapai Tribe, 78 U.S.P.Q.2d 1696 (T.T.A.B.2006). Grand Canyon involved a use-based application for registration of a trademark, not an ITU application, but, as described below, the TTAB has looked to Grand Canyon in the ITU context. In Grand Canyon, the party opposing the use-based application argued that "the application ... must fail" in its entirety because the applicant did not actually use the mark in commerce on all of the services listed in the application. Id. at *1. The TTAB disagreed. The TTAB surveyed its prior decisions and explained that while it had previously voided use-based applications where the applicant "had made no use of the mark in commerce," "an application was not deemed void ab initio if the applicant had made use on some, but not all, of the goods or services." Id. at *2 (Emphasis added.) The TTAB then explained that absent fraud, an applicant who did not use the mark on all of the goods and/or services listed in a use-application "may `cure' this problem by amending" its application to delete the goods and/or services on which it had not used the mark. Id. at *3. And that is precisely how the applicant in that proceeding saved its application: it deleted from its application the services on which it had not used the mark and was permitted to continue its effort to register the mark with respect to the services on which it had used the mark. Id.
One year after Grand Canyon, in The Wet Seal, Inc. v. FD Mgmt., Inc., 82 U.S.P.Q.2d 1629 (T.T.A.B.2007), the TTAB considered the appropriate remedy to be applied where an ITU applicant intends to use the mark on some, but not all, of the listed goods and/or services. In that case, the party opposing registration of a mark
Four years later, in Spirits Int'l, B.V. v. S.S. Taris Zeytin Ve Zeytinyagi Tarim Satis Kooperatifleri Birligi, 99 U.S.P.Q.2d 1545 (T.T.A.B.2011), the TTAB returned to the issue of what remedy to apply when an ITU applicant intends to use a mark on some, but not all, of the identified goods in its application. The ITU application in Spirits Int'l said that the applicant intended to use a mark on both alcoholic and non-alcoholic beverages in International Classes 32 and 33.
However (and this is a critical "however"), the TTAB indicated that the striking of the entire classes did not automatically follow from the fact that the applicant intended to use the mark on only some of the identified goods. Id. Indeed, the TTAB explained that the applicant "could have" avoided the invalidation of International Classes 32 and 33 in their entirety if it had undertaken the cure procedure set forth in Grand Canyon — i.e., if it had deleted from those classes the goods on which it did not intend to use the mark at the time of filing. Id. (citing Grand Canyon). Only after the applicant failed to take advantage of this opportunity did the TTAB invalidate the ITU with respect to International Classes 32 and 33 in their entirety.
In sum, none of the TTAB's relevant precedential decisions support Kelly's argument that where an ITU applicant intends to use the mark on some, but not all, of the goods and/or services listed in its application, the application is void ab initio and registration must be denied in
But the question remains: what if an ITU applicant fails to delete from its application the goods and/or services on which it lacked an intent to use its mark? Under those circumstances, should a tribunal void the entire application or should the tribunal, itself, delete the goods and/or services for which the required intent was lacking? The TTAB offered different answers to that question in The Wet Seal and Spirits Int'l.
In The Wet Seal, the TTAB suggested that the tribunal's job is to decide which "items, if any ... should be deleted from the application" due to a lack of intent to use. The Wet Seal, 82 U.S.P.Q.2d 1629 at *3. The TTAB implied that once a tribunal makes its deletions, an applicant may proceed with its effort to register its mark with respect to the remaining goods identified in the application. See id.
In contrast, in Spirits Int'l, the TTAB did not suggest that a tribunal may properly delete items that an applicant has not, itself, undertaken to delete. Instead, the TTAB said that because the applicant had failed to make the required deletions, the appropriate remedy was to void the entire classes containing the goods for which the required intent was lacking. Spirits Int'l, 99 U.S.P.Q.2d 1545 at *2, n. 3.
The Court chooses to follow Spirits Int'l rather than The Wet Seal for three reasons. First, the portion of Spirits Int'l addressing the proper remedy was the true holding of the TTAB, see 3 McCarthy on Trademarks and Unfair Competition 19:14 (4th ed. 2015) (explaining that the TTAB "held" that the entire classes must be voided based on lack of intent with respect to some items in the classes), whereas the portion of The Wet Seal addressing the remedy was not essential to the TTAB's holding. Indeed, as noted above, in The Wet Seal, the TTAB ultimately concluded that the opposer had failed to demonstrate that the applicant lacked an intent to use the mark on any of the goods, and thus the discussion of the remedy to be applied if the applicant lacked the required intent was not essential to the result.
Second, while both The Wet Seal and Spirits Int'l recognize the persuasive nature of, and purport to follow, the Grand Canyon approach to overbroad entries on trademark applications, the decision in Spirits Int'l remains truest to Grand Canyon. In Grand Canyon, the TTAB referred to the applicant's opportunity to
Finally, Spirits Int'l is a more recent precedent of the TTAB and, indeed, appears to be the TTAB's "last word" on the remedy issue before this Court. See Bobosky, 843 F.Supp.2d at 1141 n. 5 (following Spirits Int'l rather than The Wet Seal because Spirits Int'l was decided more recently).
Application of the Spirits Int'l framework leads the Court to invalidate the Creative ITUs in their entirety. In a declaration submitted along with its supplemental brief, Creative Harbor has offered to amend the Creative ITUs to eliminate one service and one good. (See Jurgensen Decl., ECF # 58-3 at ¶¶ 52-53, 59-63.) But those modest deletions do not cure the material overbreadth in Creative Harbor's listing of the goods and services on which it claimed an intent to use the Mark. Indeed, even with Creative Harbor's proposed deletions, the Creative ITUs still list services (e.g., employee relations information services, business consulting, professional credentialing verification services) and goods (e.g., computer game software, computer hardware for integrating text and audio) on which Creative Harbor lacks a firm intent to use the Mark. Creative Harbor has thus left itself in the same position as the ITU applicant in Spirits Int'l. Like that applicant, Creative Harbor failed to delete from the Creative ITUs all of the goods and/or services on which it lacked a bona fide intent to use its Mark. Thus, like the TTAB in Spirits Int'l, this Court voids Creative Harbor's ITU applications in their entirety.
On first blush, voiding Creative Harbor's entire ITUs may seem unduly harsh. In many respects, Creative Harbor "played by the rules." It worked hard to develop a potentially significant mobile application, and before choosing a name and mark for that application, it made a diligent effort to determine whether "WorkWire" was available for use. (See Jurgensen Decl., ECF # 58-3 at ¶ 19, Pg. ID 1567.) But upon closer inspection, it becomes clear that Creative Harbor's conduct was, in at least some respects, flatly inconsistent with the Lanham Act's ITU process. As the Federal Circuit has made clear, an applicant may not use an ITU "merely ... to reserve a right in a mark," M.Z. Berger, 787 F.3d at 1376, yet that is exactly what Creative Harbor did. Indeed, Mr. Jurgensen candidly admitted that Creative Harbor filed the Creative ITUs in order to broadly reserve the Mark for use in a "brand" he thought he "might" develop — a brand that extended well beyond the use that Creative Harbor actually intended to make of the Mark when it filed the Creative ITUs. And when Kelly raised Creative Harbor's lack of intent, Creative Harbor then failed to cure the problem by deleting from the Creative ITUs all of the services and goods on which it did not intend to use the Mark. Instead of curing,
Because the Court has voided the Creative ITUs in their entirety, Kelly is entitled to summary judgment on Count IV of Creative Harbor's counterclaim to the extent that that count seeks a ruling of priority based upon the Creative ITUs.
