Trademark Trial and Appeal Board
Patent and Trademark Office (P.T.O.)
*1 EUROSTAR, INC.
v.
"EURO-STAR" REITMODEN GMBH & CO. KG, SPEZIALFABRIK FUR REITBEKLEIDUNG
Cancellation No. 21,589
December 22, 1994
Before Sams, Rice, Simms, Cissel, Seeherman, Hanak, Quinn, Hohein and Hairston
Administrative Trademark Judges
Opinion by Sams
Chief Administrative Trademark Judge
Before us is a motion, filed by "Euro-Star" Reitmoden GmbH & Co. KG, Spezialfabrik Fur Reitbekleidung (respondent), to dismiss a petition to cancel its registration of the mark "EURO-STAR" (and design) for riding clothing, namely, riding jackets, riding pants (breeches) and riding coats. [FN1] Petitioner, Eurostar, Inc., opposed the motion to dismiss.
In its petition to cancel, petitioner asks the Board to "partially cancel" or to restrict respondent's registration. Petitioner asserts that it designs, imports, exports and distributes sports and casual shoes and that it has filed four U.S. applications to register various forms of the mark "EUROSTAR" for a variety of shoes. Petitioner asserts, further, that the examining attorney refused registration of its marks based on respondent's registration, which registration petitioner now asks the Board to restrict. Petitioner alleges that, for at least the last two years, respondent has not used and, therefore, has abandoned the registered mark with respect to all channels of trade in the United States except for catalog mail order sales and sales through retail establishments specializing in apparel, equipment and products for horses and for owners and/or riders of horses. Petitioner seeks, under Section 18 of the Trademark Act, partial cancellation of the registration--in particular, a restriction of the description of goods to conform to the channels of trade in which, it alleges, respondent has actually been using its mark.
In response, respondent moved to dismiss the petition for cancellation for failure to state a claim. Conceding, for the purposes of its motion, that all material factual allegations are true, respondent argues that, as a matter of law, the type of restriction that petitioner seeks to have the Board impose on its registration is not permitted. More particularly, respondent argues that the type of restriction sought by petitioner is not contemplated by Section 18 of the Trademark Act, 15 USC § 1068. The existing description of goods in respondent's registration does not, according to respondent, state its goods in terms that are overbroad, but specifically and fairly describes respondent's riding clothing. Respondent notes that petitioner is not seeking to delete any specific item from the registration and maintains that there is no legal basis to restrict its registration to certain channels of trade. Respondent argues that the amendments to Section 18 were never intended to make all registrations vulnerable to attack because the owners of those registrations had not used their marks "in every conceivable way and through every conceivable trade channel." Citing In re Elbaum, 211 USPQ 693 (TTAB 1981), respondent argues that broad interpretations of descriptions that leave room for natural expansion are a major benefit of federal registration. The type of restriction petitioner seeks, according to respondent, would not constitute a "meaningful" restriction nor "negate the undisputed fact that Respondent still is using its mark on all of the clothing items listed in its registration."
*2 Petitioner opposed the motion to dismiss and argues that its request to restrict respondent's registration should be entertained by the Board. Petitioner argues that the Board has authority to restrict a registration to limit the channels of trade or otherwise to modify a description of goods or services to avoid a finding of likelihood of confusion. Referring to the legislative history behind the amendments to Section 18, petitioner argues that those amendments were designed to permit the Board to base determinations of likelihood of confusion on marketplace realities.
Background: Section 18
Before the amendments to Section 18 [FN2], the Board was constrained to decide cases presenting the issue of likelihood of confusion based upon the recitation of goods or services that appeared in a defendant's application or registration and a plaintiff's pleaded registration (assuming that common law rights were not asserted and proved by the plaintiff), rather than on the evidence adduced at trial as to the actual goods or services or the channels of trade of those goods or services. The amendments to Section 18 were intended to give the Board greater ability to decide cases on the basis of the evidence of actual use. The immediate impetus for the revisions to the Lanham Act was a study by the Trademark Review Commission, a special commission of the United States Trademark Association (now the International Trademark Association). That study, which entailed two years of review, analysis, and debate of the merits and shortcomings of the existing system for trademark protection, culminated in the Commission's report, published at 77 Trademark Rep. 375 (1987). The language recommended by the Commission for amending Section 18 was eventually included in the Trademark Law Revision Act of 1988. Concerning the proposed amendments to Section 18, the Report of the Commission states:
Current law puts the Board in a straight jacket, bound by the goods and services descriptions in the relevant applications and registrations. For example, it must assume that "men's shirts" covers all types of shirts sold through all conceivable trade channels, even though they may be made of heavy duty wool and sold only in certain regions in mining company outlets as protective clothing for coal miners. Not surprisingly, the Board often decides the likelihood of confusion issue on hypothetical, not real world, grounds.
The Commission believes that perpetuating this artificial environment is undesirable. Actual product and trade channel differences are highly relevant and often determinative in court proceedings. The Board should be able to consider them as well, and to modify a description if it would avoid likelihood of confusion. The Board could thus delete "men's shirts," and substitute "protective woolen shirts for coal miners," while deciding that confusion is unlikely with respect to a similar mark used on tee shirts sold at rock concerts. 77 Trademark Rep. at 452
*3 In testimony before a subcommittee of the House Judiciary Committee, given September 8, 1988, the U.S. Trademark Association (USTA) made the following comments:
The Trademark Law Revision Act amends section 18 of the Lanham Act to give the Trademark Trial and Appeal Board (TTAB) the authority (i) to modify the description of goods or services recited in an application or registration if doing so will avoid likelihood of confusion on the register.... USTA supports these changes because they will allow the TTAB to base trademark registration decisions on actual marketplace factors, rather than hypothetical considerations, and will permit the TTAB to resolve issues that would otherwise require a court proceeding.
The ... change will permit the TTAB to consider differences in trade channels and products that may not be evident from the goods or services description set forth in an application or registration. [Emphasis added.]
USTA testimony before the Subcommittee on Courts, Civil Liberties and the Administration of Justice of the House Judiciary Committee, September 8, 1988.
In the Senate Judiciary Committee report on S.1883, which was the Senate version of the Trademark Law Revision Act of 1988 [TLRA] (Senate Report No. 100-515, September 15, 1988), the following discussion concerning the changes to Section 18 can be found:
Section 18(1) of the legislation amends Section 18 of the Lanham Act (15 U.S.C. 1068) to give the Trademark Trial and Appeal Board authority to limit, or otherwise modify, the goods or services identified in a registration or application. This amendment will permit the Board to base determinations of likelihood of confusion on marketplace realities rather than on hypothetical facts. For example, certain product identifications, although accurate and acceptable for purposes of registration, may appear on paper to give rise to likelihood of confusion, but would not give rise to confusion in the marketplace due to distinctions between the actual products and their channels of trade.
In a section-by-section analysis of the TLRA (Congressional Record, November 19, 1987), a similar discussion of the amendments to Section 18 can be found:
The bill gives the Trademark Trial and Appeal Board authority to limit or otherwise modify the goods or services identified in a registration or application to avoid likelihood of confusion ... This new authority, while seemingly minor, is quite significant. With respect to the first, actual product descriptions and trade channels are highly relevant in court proceedings.
S 16552-16553.
In the House of Representatives, there is similar legislative history. For example, in the House Judiciary Committee Report on H.R.5372 (House Report No. 100-1028, October 3, 1988), the changes to Section 18 are summarized as follows:
Section 18 of the bill amends Section 18 of the Lanham Act (15 U.S.C. 1068) to give the Trademark Trial and Appeal Board the authority to cancel a registration in whole or in part, to limit or otherwise modify the goods or services in a registration or application in order to avoid a likelihood of confusion ... [Emphasis added.]
The Board's Practice Under Section 18
*4 To implement the amendments to Section 18, the Patent and Trademark Office promulgated Trademark Rule 2.133, effective November 16, 1989. Section (d) of that rule provides as follows:
A plaintiff's pleaded registration will not be restricted in the absence of a counterclaim to cancel the registration in whole or in part, except that a counterclaim need not be filed if the registration is the subject of another proceeding between the same parties or anyone in privity therewith.
Thus, the Office chose, as the mechanism to permit the restriction of a pleaded registration, a counterclaim for partial cancellation.
In one of the first cases decided under amended Section 18, Alberto-Culver Co. v. F.D.C. Wholesale Corp., 16 U.S.P.Q.2d 1597 (TTAB 1990), the Board was asked to restrict a registration by limiting the goods recited in that registration from "personal deodorant" to "feminine deodorant spray." While the Board declined to exercise its authority to restrict the registration, the Board, as a preliminary matter stated, at 1603:
We note, first of all, that, although we have found for opposer on the issue of likelihood of confusion [that is, that applicant's mark was likely to cause confusion with opposer's], that finding does not deprive applicant of the standing to assert its counterclaim for partial cancellation ... Thus, although applicant has not prevailed in the opposition proceeding, if evidence in this case proves the existence of a proper ground for sustaining applicant's counterclaim for partial cancellation, the Board has authority to effect such partial cancellation.
Although the Board recited some of the legislative history noted above, it nevertheless concluded, at 1604:
Although the legislative history of Section 18 refers to situations in which a finding of likelihood of confusion may be avoided by restriction of the goods or services in an application or registration (and that situation is the one most likely to provoke a request that the Board exercise its authority under Section 18), the language of Section 18 is broad enough to allow the Board to "rectify" the register by deleting from the registration asserted by a plaintiff (i.e., an opposer or a cancellation petitioner) specific items of goods on which the plaintiff's mark is no longer used or by modifying or restricting an overbroad statement of plaintiff's ... goods, even where a deletion, modification, or restriction will not avoid a finding of likelihood of confusion. Thus, in this case, even though we have found that confusion is likely no matter how narrowly opposer's "deodorants" are described, the Board has authority under Section 18 to restrict opposer's registrations, if the evidence adduced at trial shows that the [opposer] is using the registered mark on a narrower class of goods or services than that for which it was originally registered.
Further defining its practice under Section 18, the Board has more recently stated that amended Section 18 is only a "remedy" section of the Trademark Act and that, to prove its entitlement, under Section 18, to a remedy in the form of a restriction of its opponent's application or registration, a party must plead and prove a ground for opposition or cancellation. And, under that same case law, where a party seeks to restrict the description of goods or services in a registration over five years old (the situation we have before us now), that party must plead one of the grounds for cancellation available under Section 14(3) of the Trademark Act, 15 USC § 1064--namely, abandonment of the mark as to the goods, services, or trade channels sought to be excluded from the registration. See Procter & Gamble Co. v. Sentry Chemical Co., 22 U.S.P.Q.2d 1589 (TTAB 1992) and Microsoft Corp. v. Qantel Business Systems, Inc., 16 U.S.P.Q.2d 1732 (TTAB 1990). Furthermore, the Board has permitted restrictions only if they were "commercially significant." A restriction is "commercially significant" if its entry would avoid a finding of likelihood of confusion or if the registrant has set forth its goods in terms that overstate the range of goods or the trade channels in which those goods move, so that fairness demands that an appropriate restriction to the registration be entered. See Procter & Gamble Co. v. Sentry Chemical Co., supra, at 1592.
*5 Since the amendment to Section 18, the Board has been faced with a good many cases like that now presented: cases in which parties have asked the Board to exercise its discretion to restrict their opponents' registrations and applications. As a result of that experience and, in particular, because of certain problems that have surfaced, we believe that we should modify our practice with respect to Section 18. Putting the matter simply, we believe that, in a case involving likelihood of confusion, we should not exercise our authority under Section 18 to permit an action to restrict an application or registration where such a restriction is divorced from the question of likelihood of confusion. We believe, moreover, that a party should be held to have established a proper case for restriction of an application or registration where, in a case involving likelihood of confusion, it pleads and proves that (i) the entry of a proposed restriction to the goods or services in its opponent's application or registration will avoid a finding of likelihood of confusion and (ii) the opponent is not using its mark on those goods or services that will be effectively excluded from the application or registration if the proposed restriction is entered.
Over the last few years, the Board has seen a number of pleadings in which parties have sought to restrict their opponents' long-held registrations, where such requests for restriction (although tied to grounds of abandonment) were not supported by claims that the requested restrictions would avoid findings of likelihood of confusion. The restrictions proposed in many of these pleadings have been of dubious "commercial significance," leading the Board to conclude that the requested restrictions have been made more for tactical reasons than substantive ones. By applying Section 18 in the manner we have now determined to apply it, we can virtually eliminate frivolous or harassing restriction proceedings and devote our administrative resources to those kinds of cases intended by the drafters of the amendment: those in which restrictions to applications and registrations serve to avoid findings of likelihood of confusion.
If the Board were to continue to entertain petitions to restrict registrations where such proposed restrictions have no bearing on the issue of likelihood of confusion, the Board might unwittingly encourage the use of TTAB inter partes proceedings to harass the owners of existing (and, perhaps, long-held) registrations. As respondent pointed out in its reply brief, 3-4:
Does this mean that a registration covering "dress shirts", for example, can be restricted under Section 18 to "dress shirts sold only in men's clothing stores"; or that "gold watches" can be restricted to "gold watches sold only by fine jewelers"? If all of these are possibilities, then every time an applicant is rejected by an examiner based on an existing registration, it can petition the Board to narrow a registration to the absolutely specific items and methods of sale that a registrant has made to date. Not only would this overwhelm the Board with petitions for partial cancellation, but it would make most registrations subject to challenge because there always will be some way to specifically describe exactly how a registrant is using its mark.
*6 Allowing this kind of issue to be tried forces registrants needlessly to spend time and money to defend their registrations and requires us to decide the breadth or scope of a description of goods or services in the abstract, unrelated to any determination of likelihood of confusion.
Furthermore, the Board's recent practice under amended Section 18--in permitting registrations to be attacked simply on the grounds that the statements of goods and services are overbroad--is at odds with the Patent and Trademark Office practice of encouraging applicants to set forth their descriptions of goods and services in relatively broad terms. The Trademark Examination Guide adopted at the time the TLRA went into effect cautioned examining attorneys to avoid requiring or suggesting "unduly restrictive" descriptions. See TMEP § 804.09(a), incorporating what was contained in that Guide. We agree with respondent that there certainly was no Congressional intent, in amending Section 18, to restrict applications and registrations to unworkably narrow descriptions of goods and services.
And, finally, eliminating the requirement that a party support its request to restrict its opponent's registration by pleading and proving the elements of a claim of "abandonment" keeps in focus the real issue in the case: likelihood of confusion. [FN3]
Therefore, we hereby overrule Alberto-Culver and Procter & Gamble (and any of our subsequent decisions that relied on one or both of those precedents), to the extent that those cases hold that (i) the Board will exercise its discretion to grant a petition for partial cancellation or a request for restriction even in the absence of pleading and proof that such partial cancellation or restriction will avoid a finding of likelihood of confusion and (ii) Section 18 may be invoked by the Board only when tied to a properly pleaded ground for opposition or cancellation (e.g., abandonment). [FN4]
Petitioner's Request under Section 18
In the case now before us, petitioner charges that respondent has abandoned its mark with respect to all channels of trade in the United States other than catalog mail order sales and sales through retail stores specializing in clothing and equipment for horse riders and owners. Respondent argues that the type of restriction which petitioner seeks to place on respondent's registration is not contemplated by the Section 18 amendments and that, even if all of the facts alleged by petitioner in the petition for partial cancellation are considered true--as they must be in ruling on respondent's motion to dismiss--the petition nevertheless fails to state a claim upon which relief can be granted.
As respondent has pointed out in its motion to dismiss, its identification of "riding clothing, namely, riding jackets, riding pants (breeches) and riding coats" is by no means an overbroad description but is, in reality, a very specific description of the kinds of goods on which it uses its mark. And, in accordance with the approach to Section 18 we are now adopting, the Board will not restrict respondent's registration to certain channels of trade in the absence of a pleading and proof that a finding of likelihood of confusion can be avoided by such a restriction.
Raising the Issue of Restriction under Section 18
*7 Finally, we emphasize, as we have in the past, that we will exercise our Section 18 authority only where the issue of possible restriction has been raised by the pleadings and/or is tried by the parties. See Personnel Data Systems Inc. v. Parameter Driven Software, Inc., 20 U.S.P.Q.2d 1863 (TTAB 1991) and Flow Technology, Inc. v. Picciano, 18 U.S.P.Q.2d 1970 (TTAB 1990). Moreover, a party that seeks to restrict a registration or application should state with as much precision as possible the restriction it seeks, so that the issue is properly framed for trial. See Aries Systems Corp. v. World Book Inc., 23 U.S.P.Q.2d 1742, 1748 (TTAB 1992) and Space Base, Inc. v. Stadis Corp., 17 U.S.P.Q.2d 1216 (TTAB 1990).
Summary
In summary, we will permit the restriction petitioner seeks only if the petitioner alleges (and later proves) that a likelihood of confusion will be avoided if the registration is restricted in the manner sought by the petitioner. Respondent's motion to dismiss is granted, but petitioner is allowed until 30 days from the date of this decision in which to file an amended pleading, failing which the petition will be dismissed.
J.D. Sams
J.E. Rice
R.F. Cissel
E.W. Hanak
T.J. Quinn
G.D. Hohein
P.T. Hairston
Administrative Trademark Judges, Trademark Trial and Appeal Board
FN1. Registration No. 1,250,471, issued September 6, 1983; declaration under Sections 8 and 15 filed. [There is a typographical error in the certificate of registration: in the recitation of goods, the item "riding pants" is misspelled as "riding parts."]
FN2. Section 18 now provides as follows:
In such proceedings the Commissioner may refuse to register the opposed mark, may cancel the registration, in whole or in part, may modify the application or registration by limiting the goods or services specified therein, may otherwise restrict or rectify with respect to the register the registration of a registered mark, may refuse to register any or all of several interfering marks, or may register the mark or marks for the person or persons entitled thereto, as the rights of the parties hereunder may be established in the proceedings: Provided, That in the case of the registration of any mark based on concurrent use, the Commissioner shall determine and fix the conditions and limitations provided for in subsection (d) of section 2 of this Act. However, no final judgment shall be entered in favor of an applicant under section 1(b) before the mark is registered, if such applicant cannot prevail without establishing constructive use pursuant to section 7(c).
FN3. To be clear, we emphasize that no provision of the Trademark Act requires--and nothing in the legislative history of the Act suggests--that a pleading and proof of specific grounds for cancellation (such as abandonment) are a condition precedent to the Board's exercise of its authority under Section 18. The restriction provisions of Section 18 are in the nature of an equitable remedy and may be invoked when the proofs show that restriction is equitable and appropriate (that is, when the proofs show that the entry of a restriction will avoid a finding of likelihood of confusion).
Moreover, even in the absence of a requirement for pleading and proof of grounds for cancellation, the Board has authority under Section 18 to limit the goods and services of registrations over five years old, as well as those less than five years old. Neither the wording of Section 18 nor the legislative history implies that the drafters of amended Section 18 intended that the Board's power to limit the goods and services of a registration be exercised only with respect to registrations less than five years old. And, indeed, the usefulness of Section 18 would be severely undermined if the Board's power to limit the goods and services of a registration could be exercised only with respect to registrations less than five years old.
FN4. The legislative history that we have invoked in support of this new approach to Section 18 reveals that Congress saw a second potential use of that section--a use related to intent-to-use applications. About the amendment to Section 18, Senate Report No. 100-515 (September 15, 1988) noted:
In addition, it gives the Board flexibility when addressing the goods or services identified in an intent-to-use application. For example, if testimony about the intended use results in a factual determination that the goods or services specified in the application are stated too broadly, the Board would be permitted to modify the identification accordingly.
A similar point was made in the Trademark Review Commission Report:
[O]ur proposal to amend Section 18 to allow the Board to limit descriptions based on market place reality could also apply to intent-to-use marks if testimony about the intended use results in a factual determination that the goods or services description is stated too broadly. [77 Trademark Rep. at 401]
We are aware that, in adopting an approach to Section 18 that requires proof that a proposed restriction will avoid a finding of likelihood of confusion, we appear to be frustrating the second purpose of the amendment to the section. But, a close look at Office practice concerning the identification of goods and services in intent-to-use applications should relieve any anxiety that our approach is contrary to legislative intent.
When the Trademark Act was amended in 1988 to allow an application for registration to be filed based on a bona fide intention to use the mark in commerce, the amended law left it to the Patent and Trademark Office to decide how detailed a recitation of goods or services would be required of an intent-to-use applicant. The potential existed for exceedingly broad recitations. Therefore, the authority of the Board under amended Section 18 was viewed by the drafters as a sort of fail-safe provision that would allow an opposer to challenge an intent-to-use application with an excessively broad recitation of goods or services. And, in such a case, the issue of likelihood of confusion would not come into play. But, in practice, the Trademark Examining Groups make no distinction, in the examination of the recitation of goods or services, between an application based on use in commerce and one based on a bona fide intention to use the mark in commerce. The goods and services must be recited with particularity in both types of applications. See Trademark Rule 2.33(a)(1)(v) and Trademark Manual of Examining Procedure 804.01. Because the Trademark Examining Groups apply the same rules of specificity to recitations of goods and services, whether the application is based on use or an intention to use, oppositions that seek to restrict intent-to-use applications should be subject to the same requirements of proof as oppositions that seek to restrict use-based applications--namely, proof that the entry of the proposed restriction to the goods or services will avoid a finding of likelihood of confusion and proof that the applicant is not using its mark on those goods or services that will be effectively excluded from the application if the proposed restriction is entered.
CONCURRING OPINION
*8 Simms
Administrative Trademark Judge
I agree with the majority and respondent that the petition fails to state a claim and that it should be dismissed in the absence of a suitable amendment.
As can be seen from the majority's discussion of the Section 18 amendments (effective November 16, 1989) and the Board's recent interpretations of this Section, we have in the past allowed applicants to seek restrictions of registrants' descriptions of goods or services in registrations even where those restrictions would not have aided the applicants in obtaining registrations--that is, in cases where the issue of likelihood of confusion was no longer present. The majority concludes that this practice should be changed to conform more closely with the purpose behind the amendments to Section 18. While I fully agree with this conclusion reached by the majority, I believe that some problems and ramifications of our recent practice have not been fully discussed by the majority and that it may be helpful to flesh out how our interpretation of the Section 18 amendments has created problems for us and for registrants and why it is now necessary to bring our construction of Section 18 more in line with legislative history.
Because the Board has in the past required a "ground" for cancellation when a party is merely trying to restrict a description of goods or services under Section 18, we have allowed the creation of the legal fiction of "nonuse" in connection with registrations less than five years old and "abandonment" for registrations over five years old. In a nutshell, the Board has been entertaining petitions to restrict on the grounds of "nonuse" or "abandonment" when a registrant has continuously used its mark on the goods or services described. This is a legal fiction which I believe should not have been countenanced in order to entertain the salutary benefits intended by the Section 18 amendments. The issue in these kinds of cases is not whether a plaintiff has properly pleaded a ground for cancellation when complete cancellation is not being sought. Thus, we should not have required parties merely seeking restrictions in identifications in an attempt to avoid a likelihood of confusion to assert a ground for cancellation (nonuse or abandonment). [FN1] To rectify this problem, the majority correctly overrules Alberto-Culver Co. v. F.D.C. Wholesale Corp., 16 U.S.P.Q.2d 1597 (TTAB 1990) and Procter & Gamble Co. v. Sentry Chemical Co., 22 U.S.P.Q.2d 1589 (TTAB 1992) (Manbeck, Samuels and Sams) to the extent that those cases permitted a restriction petition in the absence of a pleading that the restriction sought will avoid a likelihood of confusion and to the extent that those cases required the pleading and proof of a separate ground of nonuse or abandonment.
Under the cases we now overrule, trademark owners, who have continuously used their registered marks, have been charged with "nonuse" or "abandonment" and have been forced to defend their registrations. This fact has not escaped the attention of registrant's counsel. He points outs in his motion to dismiss:
*9 There is no doubt Section 18 of the Trademark Act was amended in part for the purpose of giving this Board greater flexibility in restricting the recitation of goods or services in registrations. However, the amendment never was intended to make each and every registration vulnerable to a charge of partial abandonment merely because a registrant had not used every item listed in every conceivable way and through every conceivable trade channel ...
Regardless of what evidence Petitioner might be able to produce at trial, i.e., even if Petitioner establishes that Respondent's goods are limited in the way that Petitioner describes them in its pleading, the type of distinction and restriction Petitioner is asking this Board to make would not constitute a "meaningful subcategory," nor would it negate the undisputed fact that Respondent still is using its mark on all of the goods listed in its registration ... (Emphasis in original.)
Moreover, I believe that it should also be made clear that "nonuse" or "abandonment" cannot be said to have occurred simply because a registrant does not use its mark on all possible products encompassed within a description of goods (all "men's shirts," for example) or in all possible channels of trade for those goods. Under the Trademark Law Revision Act of 1988, a mark is considered abandoned when its use has been discontinued with intent not to resume and nonuse for two consecutive years is prima facie abandonment. A mark is deemed to be abandoned:
When its use has been discontinued with intent not to resume such use. Intent not to resume use may be inferred from circumstances. Nonuse for two consecutive years shall be prima facie evidence of abandonment. "Use" of a mark means the bona fide use of that mark made in the ordinary course of trade, and not made merely to reserve a right in a mark. [Underlined words were added by the TLRA.]
It is clear that, for a mark to be abandoned, its use must be discontinued. That is, the bona fide use of that mark in the ordinary course of trade must be discontinued with intent not to resume. A registrant, as in the case before us, should not be charged with abandonment when, apparently from day one, it has used and continues to use the mark on the goods listed in its registration. Moreover, we should keep in mind that abandonment is generally regarded as a forfeiture of rights and the courts and the Board have required strict or clear and convincing proof before finding abandonment. See, for example, Wallpaper Manufacturers, Ltd. v. Crown Wallcovering Corp., 680 F.2d 755, 214 USPQ 327, 333 (CCPA 1982). Nevertheless, under the theory of "abandonment," the Board has in the past permitted counterclaimants and petitioners to seek unwarranted partial cancellation. [FN2]
Moreover, the result of the Board's recent practice under amended Section 18 was at odds with the liberality which this Office encourages in setting forth descriptions of goods. An applicant should not be forced to set forth such a limiting description which for all time would foreclose a restriction petition. We agree with respondent's attorney that there certainly was no Congressional intent to restrict applications and registrations to unworkably narrow and specific descriptions. The Office Examination Guide adopted at the time the TLRA went into effect noted that examining attorneys should avoid requiring or suggesting "unduly restrictive" descriptions. See TMEP Sec. 804.09(a), setting forth what was contained in that Guide.
*10 Respondent has pointed out in its motion to dismiss that its identification of "riding clothing, namely, riding jackets, riding pants (breeches) and riding coats" is by no means an overly broad description but is, in reality, a very specific and accurate description of the kinds of goods on which it uses its mark. Respondent is correct when it argues that, under the circumstances of this case, there is no legal basis for the Board to restrict respondent's registration to certain channels of trade, at least in the absence of a pleading that, if the registration is so restricted, there will be no likelihood of confusion with petitioner's applied-for mark as used on its goods. Yet, respondent's registration is being challenged and respondent is being asked to restrict its description of goods. We should not require any more specificity in order to avoid these types of partial cancellation actions. (Liberal consideration of descriptions by this Office may be even more justified in the case of intent-to-use applications where an applicant has not yet decided, for example, on what type(s) of "men's shirts" it may eventually use the mark.)
Recent history has borne out the fact that problems are created by a party seeking restriction on the ground of "nonuse" or "abandonment" separate and apart from any consideration of likelihood of confusion. We have already had a number of cases, including this one, whereby applicants in counterclaims and plaintiffs in petitions have sought to restrict descriptions, not to avoid any likelihood of confusion, but simply to restrict a description even when to do so would not avoid the likelihood of confusion. For example, parties have sought Section 18 restrictions of "envelopes" to "envelopes sold only with greeting cards into which they are inserted [sic]" (Canc. No. 18,163); of "automobiles and structural parts therefor" to "luxury automobiles" (Canc. No. 18,767); of certain defined prescription medicines (by counterclaim in Opp. No. 75,140); of a description covering hair shampoo, conditioners, rinses and hair waving lotions to make clear they were for human use and not for pets (by counterclaim in Opp. No. 87,724); and to limit an identification covering metal fabrication services (by counterclaim in Opp. No. 89,429). All these attempts to restrict have been lodged even when the restrictions were not sought for the purpose of avoiding the likelihood of confusion. In still other cases parties have sought restrictions without clearly indicating whether the proposed amendments were attempts to avoid likelihood of confusion (counterclaims in Opp. Nos. 87,724 and 89,759). These kinds of cases force registrants needlessly to spend time and money to defend their registrations and require us to decide the breadth or scope of a description of goods or services unrelated to any determination of likelihood of confusion. However, by interpreting the language of Section 18 as the majority now indicates, we can virtually eliminate these frivolous restriction proceedings and confine our efforts to those kinds of cases intended by the drafters of the amendment--restrictions of existing registrations (and applications) when those restrictions serve to avoid a likelihood of confusion. If we interpret Section 18 in the manner in which it was intended to apply, registrants would not be in jeopardy of losing their registrations but would only be subject to restriction if the restriction were reflective of marketplace reality and only if the amendment would permit another party to obtain a registration. [FN3]
*11 To allow restrictions of registrations in the absence of a likelihood of confusion determination does serious harm to the integrity of the register. The following hypothetical examples help illustrate the results of our prior practice. An applicant seeks to register a mark for juice drinks that is strikingly similar to the long registered and very famous mark COCA-COLA. The Examining Attorney refuses registration or, if not, the registrant opposes. The applicant then files a petition to cancel or, if an opposition has been filed, a counterclaim seeking to restrict the registration from, say, soft drinks and syrups for making soft drinks to "carbonated cola beverages and syrups not containing fruit juices or fruit flavoring." Or an applicant seeks to amend another party's registration covering sauces to simply tomato sauces or one covering vitamin tablets to only vitamin C tablets. Or to change a description from "board games" to "real estate board games." Under the Board's former interpretation of Section 18, even if we were to find that the applicants' marks in the foregoing examples were clearly likely to cause confusion and that the applicants were, therefore, not entitled to registrations, we would nevertheless have to permit those applicants to seek restrictions of those registrations. Such proceedings would force those registrants to spend time and money unnecessarily in defending registrations with descriptions of goods which this Office had found perfectly acceptable. As respondent's attorney has pointed out in his reply brief, 3-4:
Does this mean that a registration covering "dress shirts", for example, can be restricted under Section 18 to "dress shirts sold only in men's clothing stores"; or that "gold watches" can be restricted to "gold watches sold only by fine jewelers"? If all of these are possibilities, then every time an applicant is rejected by an examiner based on an existing registration, it can petition the Board to narrow a registration to the absolutely specific items and methods of sale that a registrant has made to date. Not only would this overwhelm the Board with petitions for partial cancellation, but it would make most registrations subject to challenge because there always will be some way to specifically describe exactly how a registrant is using its mark. If we reach the point where Section 18 is applied in this manner, then the PTO might as well reevaluate its examination guidelines and require examiners to be even more specific than they are when accepting descriptions of goods or services.
The appropriateness of descriptions of goods and services in cases like this, divorced from any consideration of likelihood of confusion, is a determination which needlessly adds to the already burdensome workload of the Board. A trial conducted on the various channels of trade in which certain goods may travel and whether a registration should be restricted in a "commercially significant" manner, in the abstract, is, simply put, a determination in which the Board should not find itself engaged. We should only consider such an issue in the context of a trademark question. For example, in this particular case, long after the five-year period has passed, we might have had a trial on the question of the possible channels of trade for riding clothing, whether registrant has sold its goods in all of those channels of trade and, if not, whether a restriction to certain channels of trade is one which should in fairness be made. Such a determination should be made only in the context of a determination of likelihood of confusion, in accordance with the clear legislative intent. The advantages of linking restriction with a determination of no likelihood of confusion (including the protection of the long-standing rights of registrants) far outweigh the disadvantages to the trademark system. Moreover, it should be borne in mind that the descriptions in question have already been approved by the Office, which has a reputation for being somewhat rigid in the requirements for specificity in descriptions of goods and services. The case before us presents a good example of why we should not entertain restriction petitions in the absence of a pleading that the restriction will serve to avoid a likelihood of confusion. The respondent in this case adopted an identification which was perfectly acceptable to this Office and, despite a charge of abandonment, has apparently always used its mark on its specifically described goods.
*12 Conceptually, a strong analogy could be drawn between what is involved in these kinds of cases--a petition to restrict an identification--and concurrent use applications where an applicant seeks to restrict the geographic scope of an application or registration. Both seek limitations of some sort of pending applications and registrations. In neither type of case should a ground for cancellation be required. In both cases, restriction is warranted only if there is no likelihood of confusion. In fact, it may be very helpful for parties involved in Section 18 restriction cases to perceive the concept of a restriction to an identification of goods or services as analogous to the concept of a geographic restriction in a concurrent use proceeding. [FN4]
A final note--it should be obvious from the discussion of amended Section 18 that the instant case is different from that where a registrant may have ceased use of its mark on one of the goods listed in its registration. If, for example, this registrant had abandoned its mark with respect to riding pants, a party (who has standing or a real commercial interest) could seek a restriction (deletion of these goods) on the grounds of abandonment of the registered mark for those goods. [FN5]
Administrative Trademark Judge, Trademark Trial and Appeal Board
FN1. One might also argue that the assertion of this "ground" is an unnecessary formal legalism. That is to say, any party who claims that a description of goods should be restricted of course can allege the ground of "nonuse" or "abandonment" of the mark as to the goods or services sought to be deleted. That is inherent in the nature of the claim for a restriction--that there are some goods or services in connection with which the mark has not been used. One must wonder, therefore, why it has been necessary for a party to plead one of these grounds when claiming that a description was overly broad.
FN2. One can read the entire chapter on abandonment in J.T. McCarthy's latest edition of his treatise in vain to find a discussion of this kind of "abandonment"--that is, that a registrant, despite continuous use of its mark on the goods listed in the registration, has "abandoned" its mark because it may not have used its mark on all conceivable goods encompassed within a description (in connection with, say, all types of "men's shirts") or in all of the channels of trade possible for those goods. See McCarthy on Trademarks and Unfair Competition, Third Edition (1992).
FN3. While there has been some abuse of the Section 18 restriction authority, other parties have also sought to use Section 18 in proper attempts to avoid likelihood of confusion. See Aries Systems Corp. v. World Book, Inc., 23 U.S.P.Q.2d 1742 (TTAB 1992); Personnel Data Systems Inc. v. Parameter Driven Software Inc., 20 U.S.P.Q.2d 1863 (TTAB 1991) [attempted amendment came too late in the proceeding]; Flow Technology Inc. v. Picciano, 18 U.S.P.Q.2d 1970 (TTAB 1991); and Space Base Inc. v. Stadis Corp., 17 U.S.P.Q.2d 1216, 1218 (TTAB 1990).
FN4. In both cases, if a registrant should default, there is (or at least should be) no danger of cancellation but only of the entry of the restriction requested by the plaintiff. See Trademark Rule 2.99(d)(3).
FN5. As noted by the majority, the legislative history of the amendments to Section 18 also contains statements that the restriction authority could also be used by the Board
if testimony about the intended use results in a factual determination that the goods or services specified in the application are stated too broadly ...
However, I believe that this concern has been allayed by the Office's administration of the TLRA as it pertains to intent-to-use applications. The amended Act and rules require that an applicant specify the goods and/or services in connection with which an applicant uses or has a bona fide intention to use the mark in commerce. See Sections 1(a)(1)(A) and 1(b)(1)(A) and Rule 2.33(a)(1)(v). Identifications must be specific and definite. See TMEP Section 804.01. Descriptions in intent-to-use applications are treated no differently, therefore, than the identical descriptions in use-based applications. For example, if either a use-based or an intent-to-use application sets forth "receivers" in the description of goods, this Office would notify the applicant that that description was indefinite and that the specific type of receiver (stereo, television, etc.) on which applicant uses or intends to use its mark should be indicated. In the case of a permissively broad description (such as "a full line of cosmetics"), this Office would inform an applicant whose application is based on actual use in commerce that this description is allowed if applicant does in fact use its mark on a full line of cosmetics and submits evidence of that use. See TMEP 804.03. Similarly, if this description is contained in an intent-to-use application, the Office will advise applicant that the description will be permitted if, in support of applicant's amendment to allege use or statement of use, applicant demonstrates that it uses its mark in connection with a full line of cosmetics. Therefore, and because of the manner in which the Office examines intent-to-use applications, I do not visualize that an opposition will or should have to be filed when "the goods or services specified in the application are stated too broadly."
Finally, we should not encourage the filing of oppositions based solely on a party's belief that a description might be too broadly stated. To do otherwise would require proceedings where testimony must be taken solely on the subject of the intended uses of the mark by an intent-to-use applicant. Where an applicant has not yet commenced use of a mark, such a proceeding would appear to accomplish little, especially considering the fact that the description of goods or services in question has already been examined by the Office and found specific and definite.