By Dan McPheeters and Michael Stein
Trademarks have been an interesting topic of late, particularly with the drama surrounding Apple’s voyage into China. One interesting question that has not received much coverage of late is when exactly a mark qualifies for federal protection. This post and its follow-ups will explore one method of applying for trademark protection that is particularly ambiguous.
Among the five bases for filing a trademark application, one popular method is a “use” application, which is allowed under 37 C.F.R. § 2.34(1). The core element to filing such an application is the requirement that product is “in use in commerce” under 15 U.S.C. § 1127. 37 C.F.R. § 2.34(1). The phrase “use in commerce” is defined in 15 U.S.C. § 1127 as:
the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark. For purposes of this Act, a mark shall be deemed to be in use in commerce–
(1) on goods when–
(A) it is placed in any manner on the goods or their containers or the displays associated therewith or on the tags or labels affixed thereto, or if the nature of the goods makes such placement impracticable, then on documents associated with the goods or their sale, and
(B) the goods are sold or transported in commerce, and
(2) on services when it is used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services.
Courts have been uniform in recognizing that the qualifying phrase “in commerce” indicates Congress’ intent to apply this provision to the full extent allowable under the Commerce Clause. See, e.g., Buti v. Impressa Perosa S.R.L., 139 F.3d 98, 102 (2d Cir. 1998) (quoting United We Stand America, Inc. v. United We Stand, America NY, Inc., 128 F.3d 86, 92 (2d Cir. 1997)). Any use must be bona fide, meaning the use must demonstrate an intention for “continuous commercial utilization” of the mark in connection with the product or service. Aktieselskabet AF 21 November 2001 v. Fame Jeans Inc., 525 F.3d 8, 20 (D.C.Cir. 2008) (internal citations omitted); Allard Enters. V. Advanced Programming Res., Inc., 146 F.3d 350, 358 (6th Cir. 1998) (internal citations omitted). However, Courts have been inconsistent in determining where the line for commercialization is drawn, and to what extent a mark must be disseminated before protections will attach. Compare Buti, 139 F.3d 98 and Fame Jeans Inc., 525 F.3d 8, 20 (D.C.Cir. 2008) (rejecting the argument that a product met the “use in commerce” standard when the alleged use was the sale of T-Shirts emblazoned with the logo of a foreign café, and mentioning a product’s U.S. availability in press releases, respectively), with Brookfield Communs., Inc. v. West Coast Entm’t Corp., 174 F.3d 1036, 1052 (9th Cir. 1999) and Halo Mgmt., LLC v. Interland, Inc., 308 F. Supp. 2d 1019, 1033 (N.D. Cal. 2003) (recognizing that rights to a mark can vest prior to the actual sale of a good if there is public and widespread dissemination of the relevant marketing materials, or if “the totality of [the seller’s] prior actions, taken together, can establish a right to use the trademark,” respectively) (internal quotations omitted).
In Buti and Fame Jeans, the Courts were confronted by what can best be described as “token uses” that put the marks outside the realm of the “use in commerce” standard. See, e.g., Fame Jeans, 525 F.3d at 20. For instance, Giorgio Santambrogio had distributed within the U.S. “literally thousands of T-Shirts, cards, and key chains” on which the logo of his Italy-based café was emblazoned prominently, despite never having opened a restaurant or café in the United States. Buti,139 F.3d at 105. The Court reiterated the principle that the rights that vest in a mark are contingent upon “an established business or trade in connection with which the mark is employed” and rejected the claim that Santambrogio’s actions constituted a use in commerce sufficient for rights in the mark to vest. Id. at 105 (quoting United Drug Co. v. Theodore Rectanus Co., 248 U.S. 90, 97 (1918), superseded by statute, Lanham Act, 15 U.S.C. 1115(b)(5)); see also Allard Enters., Inc. v. Adv. Programming Res., Inc., 146 F.3d 350, 359 (6th Cir. 1998) (noting that “sporadic or minimal sales” are insufficient) (internal citations omitted). This principle is echoed in Fame Jeans, where the Plaintiff failed to demonstrate a continuous commercial exploitation of the branded jeans, despite press releases heralding the brand’s presence in the U.S. 525 F.3d at 20. Plaintiff’s advertisement, which the Court found lacked the character of “continuous commercial utilization,” touted their product’s availability “to U.S. consumers through [Plaintiff’s] foreign customers and stores as well as through re-sales on eBay.com.” Id. (noting that the marketing language did not even state that sales had occurred in the U.S.) (internal citations omitted).
Conversely, the 9th Circuit has mirrored the 1st Circuit and the Southern District of New York in recognizing that rights to a mark can vest prior to sale of the product or service. Brookfield, 174 F.3d at 1052. While noting that mere intent or preparation for use are not enough, the Brookfield Court adopts the standard that rights to a mark vest when a use is “sufficient to create an association among the public between the mark and [its producer].” Id. In this case, the Defendant had registered a website titled “moviebuff.com” and used the purported mark in e-mail correspondence with lawyers and customers. Id. However, the Court looked at the limited number of individuals to whom this mark was disseminated and rejected Defendant’s claims as “akin to putting one’s mark on a business office door sign.” Id. (internal citations omitted). A national press release from 1998 announcing the website was the first moment the Court believed use in commerce could be said to have occurred, more than two years after the communications on which Defendant based their earlier claim. Id.; but see, Halo Mgmt, 308 F. Supp. 2d at 1033 (holding that an internet homepage used “to promote its mark and attendant offerings” was sufficient to constitute a use in commerce, despite many of the small number of customers being close acquaintances of Plaintiff).
Fame Jeans itself supports the interpretation adopted by the 9th Circuit. While the Court rejected the notion that Plaintiff had used the mark sufficiently to gain trademark protection, it did note that “analogous use” afforded one the right to oppose others from filing an application covering the mark. Fame Jeans, 525 F.3d at 20 (noting that 15 U.S.C. § 1052 “requires only ‘use in the Unites States,’ and adoption of the mark by use analogous to strict trademark use will therefore suffice”) (internal quotations omitted). Among the activities that meet this standard are the “marketing of a trademarked product before the product is ready for sale” so long as the marketing is “of such a nature and extent as to create public identification of the target term with the [producer’s] product.” Id. (internal quotations omitted). The Fame Jeans Court never actually settles the question of whether the Plaintiff in this case had met this standard by virtue of their “research and marketing” uses, as it had not been raised at trial. Id. at 20-21.
While it appears clear that the use in commerce standard can be met by means other than actual sales of a product across state lines, the precise line between protectable and not is blurry. Strong support exists for an “analogous use” standard that vests rights in a mark when the marketing and promotion of the product or service with which the mark is associated rise to the level of communicating a bona fide intention for “continuous commercial utilization” of the product. Examples cited approvingly by Courts range from Marvel Comics’ distribution of 430,000 fliers with the title of a new comic book, Brookfield, 174 F.3d at 1052, to the creation of a webpage that was “universally available”, “place[d] the mark in the public domain”, and attached the mark to Plaintiff’s product “in a readily accessible manner.” Halo Mgmt., LLC, 308 F. Supp. 2d at 1033. As Halo illustrates, the focus will not necessarily be on the number of persons who are actually impressed upon by the marketing scheme, but rather the nature of the marketing scheme such that the mark and its connection to a product or service is readily accessible to the public.
In our next post on this topic, we will expand upon the analogous use standard in the hopes of providing a useful tool for practitioners in evaluating whether a client’s mark is subject to federal protection.