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Introduction to Trademark Law - An Overview from the PTO's Pet Peeves in Applying for a Trademark to Proving Infringement in Federal Court

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Introduction to Trademark Law - An Overview from the PTO's Pet Peeves in Applying for a Trademark to Proving Infringement in Federal Court

Young and old attorneys can always learn something about Trademark Law. In this introduction to Trademarks, attorneys learn the basics of Trademark Law from prosecution of a Trademark to obtain one through litigation when a Trademark is infringed. The presentation is broken down into three sections. First, the results of an interview with a Trademark Examiner from the United States Patent and Trademark Office about her prosecution pet peeves is addressed. Second, the basics of Trademarks is presented. Third, a sample case on Trademark infringement is thoroughly analyzed and discussed.

Presenters

Ken Kula
Senior Counsel
Buether Joe & Counselors, LLC.

Transcript

Ken Kula: Welcome to the introduction to trademark law by Quimbee. My name is Ken Kula. This presentation includes a number of course materials, including today's slides complete with detailed presenter notes and references to outside websites. You can follow along with those slides or simply sit back and enjoy our introduction to trademark law. In the end, it will provide you a unique overview of trademark law, including the application process where I identify and address certain pet peeves of an individual trademark examiner from the PTO whom I interviewed, discuss basic trademark rules and regulations, and discuss other basic trademark issues. And then I provide a thorough analysis of a recent trademark case from the United States District Court for the Western District of Washington, which addresses a quintessential trademark battle between a bus manufacturer and an airline owner. With that basic overview of what we are going to cover, let's get started with an introduction to trademark law.

  The first section, we'll talk about applying for a trademark. And I'll talk about the online guidance provided by the United States Patent and Trademark Office. Let's begin. Applying for a trademark is a relatively easy task. The United States Patent and Trademark Office, or as I'll refer to it throughout this presentation, the PTO, has provided applicants with a user-friendly website that walks the applicant through the process step by step. The website is located at www.uspto.gov. That's www.uspto.gov. In fact, the PTO website even asks the question, "First-timer?" Immediately underneath that question is a hot link that will provide you with the basics on trademarks, which is intended to teach you how to avoid mistakes that cost you time, money, and potentially, your legal rights. So do yourself a favor and spend an hour or so reviewing the information that the PTO provides.

  In particular, when you click on the first-timer link, you'll be taken to a webpage that provides the applicant, you, with the trademark basics. It covers topics like, what is a trademark? Why register your trademark? Examination of your application, common problems in applications, as well as various other topics and information that will help you, possibly the first-time applicant, apply for a trademark. But because anyone can review that information and does not need Quimbee or me to help them in doing so, I will not review the information on the PTO website. I highly encourage you, however, to review it in depth. As I indicated, there is a wealth of information on the website for the first-time applicant. But let's move on to the second section of this presentation. The behind the scenes guidance from a trademark examiner. Here at Quimbee, we do not just provide you with the rote and generally available information that any CLE provider can and does provide.

  No. We strive to provide you different information in a different format. This facilitates the learning process. Based upon that objective, let's take a look at what a current experienced trademark examiner within the PTO says are, for the sake of anonymity, his or her top 11 pet peeves regarding examining applications for trademarks. Why 11? That's because that's how many pet peeve the PTO gets. Are you ready? Here we go. Pet peeve number one, the examiner stated, "No parentheses or brackets in the identification of the goods." The examiner provided the example, "Belts (clothing)." No. The examiner stated if that were the inputted identification, belts (clothing), it would have to amend it to either belts or belts being clothing. So to avoid unnecessary amendments, do not use parentheses or brackets in the identification of goods when you're applying for your trademark. Pet peeve number two, the identification of the owner of the trademark and the entity associated with the application must match.

  Too often, the examiner does not see this happen. Often, the examiner sees the name of an individual, and then the entity says something like LLC. Another pet peeve is having an LLC in the owner's name, but then the entity says corporation. An LLC is not a corporation. So remember, make sure the identification of the owner of the trademark and the entity associated with the application matches. Pet peeve number three, the description of the mark, if required, should be exactly what you see in the drawing and/or the specimen. The examiner that I interviewed provided the following example as a good description of a mark. "The mark consists of the letters X, Y, Z in stylized font with a circle over the letter Z." The examiner stressed that the PTO does not accept extraneous matter explaining what the mark represents or is supposed to convey. In other words, the PTO does not care about your feelings. Pet peeve number four, when applying for a color mark, if white is enclosed, it must either be claimed as a color or indicated as background area and not a feature of the mark.

  The examiner I interviewed indicated that he or she is not there to assume things about the mark. So make sure that when you're applying for a color mark, if, for example, white is enclosed, it must either be claimed as a color or indicated as background area, and not a feature of the mark. Pet peeve number five. Similarly, the examiner that I interviewed explained that white marks on a black background invariably create a background shape around the mark. This may not be intended by the actual applicant. So this leads every examiner, him or her that I interviewed included, to wonder whether this was actually intended. For example, the examiner might be questioning whether the applicant wants what appears to be a square black background in the mark. So make sure that white marks on a black background are intended. Pet peeve number six. With respect to a specimen's description, the examiner stated, it would be helpful to understand what the specimen is, not what it looks like.

  The examiner provided the following examples as good descriptions for specimens. "The specimen consists of a mark on a shoe." Or, "The specimen consists of a screenshot of the software." Or yet another example, "The specimen consists of a page from the website." Each of these specimen descriptions states what the specimen is, not what it looks like. When the specimen actually is described what it is and not what it looks like, the examiner's work is much easier. Pet peeve number seven. The examiner that I interviewed was adamant that often, less words are better when describing the applicant's goods. Less is best. For example, headwear. Just the word "headwear" is acceptable without further clarification of the goods. But caps or visors, that would require further clarification for a proper classification in class 25 of the goods. The examiner stated that less will get you more. So if we're talking about headwear, let's just use the word "headwear" and not further describe it as caps, or visors, or something that is more of a subcategory than the general category of headwear.

  Pet peeve number eight, the examiners express the belief that much like life in general, practicing the kiss method, keep it simple, stupid, would suit most applicants. In particular, the examiner stated that with multi-class applications, they can get hung up if just one class has a 2D or likelihood of confusion issue. Thus, the examiner stated that it is sometimes best to do a separate application instead of claiming multiple classes within one application. So the attorney should take a little more time and a little more work in applying for multiple applications instead of including many classes within one application. Pet peeve number nine, the examiner was particularly peeved about bad drawings. The examiner stated that drawings that are submitted from photographs taken of the mark on goods often are bad. The examiner stated, "They have odd background designs from the texture of the material and have a background that is not intended, and may even contain wording that is not part of the mark, which may or may not be deleted.

  "It is not a good idea to accept drawings from clients that contain extraneous matter or is poor quality." So as you apply for the mark, as the attorney, do not simply accept what the client offers you nor take a photograph with your smartphone and use that as a drawing. The examiner was particularly peeved about these bad drawings being submitted, especially when they're submitted from photographs taken on the mark on the goods themselves. Pet peeve number 10, the examiner stated that a "fatal mistake" he or she often encounters is a result of the applicant simply not understanding what he or she really has. Either the client or the attorney who is filing the application must know what they actually have to get the correct trademark applied for. The examiner gave the following real world example. And I quote, "An applicant came in for medical services in class 44. They did not provide medical services.

  "Rather, they were a software company and their downloadable software contacted medical services whereby a doctor was provided. They should have come in for downloadable software in class 009. We cannot change that. Application denied. The final office action was a rejection." The problem here is that either the client didn't know what they actually had, or the attorney applying for the trademark did not know what they really had. There is a huge difference between getting a trademark for medical services in class 44 compared to getting a trademark for downloadable software in class nine. And so if you are actually a software company that has downloadable software that contacts medical services whereby a doctor is provided, then apply for a trademark in class nine for downloadable software, not in class 44 for medical services. The final pet peeve, pet peeve number 11. The examiner saved his or her favorite pet peeve for the end.

  The examiner I interviewed explained that how and where the mark is on the specimen dictates if it is a trademark or simply ornamental. The examiner gave the following example that is encountered on a regular basis at the PTO and always raises his or her ire. "A trademark for shirts is usually on a hanged tag, label on the back of the neck, or a tiny logo embroidered on the breast pocket. Typically, men's shirts. Ralph Lauren is the perfect example. A tiny embroidered logo on the breast pocket of a guy on a horse. That's a trademark. But put that same logo in a large size in the middle of a t-shirt, that's not a trademark. That is ornamental." So it is very important to know that a trademark in a certain size and place is acceptable. But take that same graphic and put it exploded on the shirt, multiple places or in the center of the shirt in a large size, it changes what once was an acceptable trademark, polo's horse pony, to simply an ornamental design on a t-shirt, which cannot acquire trademark protection.

  So there you have it. An inside look at the 11 pet peeves of one particular trademark examiner at the PTO. If you keep those 11 items in mind and very importantly, review the online videos that the PTO provides, even a first-timer should be able to get its trademark application pass, any examiner, and get a trademark issued. And that is, after all, what you are intending and desiring to do, isn't it? So make sure that you read the PTO or go to the PTO website, follow those videos and those links, and then keep in mind the 11 pet peeves and you'll be able to make sure that you have the best chance of getting a trademark from your application. So now, let's review the trademark basics regarding strength of mark as it relates to the ability to register and enforce through infringement litigation, your trademark. Because most often, it is the attorney that is wanting to make sure that they get the strongest mark and prevail in infringement litigation.

  So let's talk about the three elements of a trademark infringement claim. Under the federal court system, the Lanham Act, that's L-A-N-H-A-M, Lanham Act, provides protection for trademarks. "To prevail on a claim of trademark infringement, under section 32 of the Lanham Act, a plaintiff must demonstrate, one, that the plaintiff owns a valid and enforceable trademark." Very important. "Number one, that the plaintiff owns a valid enforceable trademark. Two, that the plaintiff used the trademark in commerce without consent. And three, that the unauthorized use was likely to deceive, cause confusion, or result in mistake." That comes from the case of Davidoff & CIE, SA versus PLD International Corp, can be found at 263 F.3d 1297, an 11th Circuit case. You can also find the same information at McDonald's Corp versus Robertson, 147 F.3d 1301, also 11 Circuit case, and go, of course, to 15 United States Code, section 1114, subparagraph 1A.

  So in review, the three elements of a trademark infringement claim are, one, that the plaintiff owns a valid and enforceable trademark. Two, that the defendant used a trademark in commerce without consent. And three, that the unauthorized use was likely to deceive, cause confusion, or result in mistake. With respect to the first element, a trademark is presumed valid and enforceable if it is registered with the PTO or is obtained in contestable status. So with regard to element number one, that the plaintiff owns a valid enforceable trademark, the easiest way to prevail and to satisfy that element is to register your trademark, because then it is presumed valid and enforceable. And if it is obtained in contestable status, the same is true. Regarding the second element, an alleged infringer's use of the plaintiff's trademark in commerce is not often a contentious issue and is proven through common sense evidence.

  So with regard to element number two that the defendant used the trademark in commerce without consent, that is usually not a very argued element. There will be proof that the defendant used the trademark at issue. There will be evidence that the use was in commerce. And obviously, if the plaintiff is bringing an infringement case, he will provide evidence that it was done without his consent. Consequently, it is the third element, likelihood of confusion, that is most likely at the crux of any trademark infringement action. Thus, it will be the focus hereafter. We will look in depth at the third element, likelihood of confusion. So let's move on to the determination of the strength of the mark under the likelihood of confusion element. Federal district courts typically use a multifactor analysis to determine the likelihood of confusion factor.

  One, strength of mark alleged to have been infringed. Two, similarity of the infringed and infringing marks. Three, similarity between the goods and services offered under the two marks. Four, similarity of the actual sales methods used by the holders of the marks such as their sales outlets and customer base. Five, similarity of advertising methods. Six, the intent of the alleged infringer to misappropriate the proprietor's goodwill. And seven, the existence and extent of actual confusion in the consuming public. Certain federal courts add an eighth factor, some have a seventh factor, but all of them include the essence of what I have just described. But understanding the strength of a trademark is one of the most important aspects of trademark law. The spectrum of strength ranges from generic, which is a weak mark unable to be protected, to arbitrary or fanciful, which is a strong mark that provides the strongest protection.

  The following is a summary of each type of mark along the spectrum. So let's start with a generic mark. A generic mark consists of "words or symbols that describe the product itself, rather than distinguish between competing versions of the product." A trademark can be rendered generic if consumers begin to use the mark as the generic name of the entire product group. Example, aspirin. This strength is never distinctive. It is no strength. An example would be email. You cannot get a trademark for email because it is a generic description of electronic mail. This information comes from www.revisionlegal.com under trademarks and the trademark infringement tests. So generic marks are both marks that cannot be protected initially, example, if I wanted to trademark email for electronically transmitted messages over the internet, I could not, as well as marks that lose their protection because they have become so closely associated with the product they identify that they've lost their distinctiveness.

  A perfect example of this is Xerox, which is a brand of copier which is a protected trademark. But it has been maintained as a protected trademark because of the vigorous defense that Xerox has put on, because there came a time when many people were starting to use the term "Xerox," which is obviously a fanciful trademark because there's no such word in the English language as Xerox, but people were starting to equate Xerox with copy. And so people would say, "Go make me a Xerox of this." And if that became prevalent, then Xerox would've lost its trademark protection status. That's an example of a trademark which once was protected as fanciful, which is garnered the greatest strength, to becoming generic, which has no strength at all and cannot be trademarked. But as of today, Xerox is still a protected trademark due to the diligence of the Xerox Company. Let's move on to the second category of strength of mark, which is a descriptive mark.

  A descriptive mark consists of "words or symbols that merely describe the ingredients, qualities, features, purpose, or characteristics of a product." The strength distinctive only if the mark has acquired secondary meaning. Secondary meaning indicates that although the mark is on its face descriptive of the product, consumers recognize the mark as having a unique source. Registered marks with incontestable status will be presumed to be at least descriptive with secondary meaning. An example of this is Windows. Although Windows seems to be a very descriptive mark, it is actually trademarked because it has acquired secondary meaning with regard to Microsoft and the products it provides, Microsoft Windows. Thus, a trademark for honey-baked ham might not be able to obtain protection initially, because honey-baked ham seems quintessentially descriptive. It is describing the ham and the way it is baked via honey, honey-baked ham. So you cannot get much more descriptive than honey-baked ham.

  However, even though it might not be able to obtain protection initially, if the attorney for the company that was using the mark, the Honey Baked Ham Company, applied for it, it could nevertheless later prove that very often when people hear honey-baked ham, they think of the product coming from the Honey Baked Ham Company. Then the trademark protection could be obtained because it has acquired secondary meaning. Every time the consumer here's honey-baked ham, they think, "Oh, that's the ham that the Honey Baked Ham Company provides." And so although it's merely descriptive in the beginning and doesn't have trademark protection, it acquires trademark protection after years of consumer use and association with the Honey Bake Ham Company or any other company. Okay. Moving on to the easier and better marks, and the marks with greater strength, next is a suggestive mark. "Suggestive trademarks suggest qualities of the underlying product, such that it requires imagination, thought, and perception to determine the nature of the product in question."

  Here, the strength is inherently distinctive. It does not need any other maturation. It is inherently distinctive. An example is PlayStation. It was trademarked because it suggests that it's a video game device, PlayStation. It's suggestive. It is not merely descriptive and it is definitely not, at least at the time that it was applied for, generic. Although a suggestive mark is not as strong as the next discussed arbitrary or fanciful marks, suggestive marks are the most common type of trademark. This should not be surprising. This is because of the marketing advantages of tying a particular trademark to a particular product in the consumer's minds. Suggestive marks, however, are often difficult to distinguish from merely descriptive marks since each is intended to reference the product at issue. But suggestive marks, again, require some thought, some perception, something else other than merely descriptive, and that is why they're given greater strength.

  Moving on to the fourth of five strengths of mark. The fourth type of mark is an arbitrary mark. And some people lump arbitrary and fanciful marks together, but they are actually very distinct and different marks, although they both have the same level of strength, which is very strong. "Arbitrary terms are names that exist in popular vocabulary, but have no logical relationship to the products for which they are used." Whether a word is arbitrary or not has everything to do with the context in which it is used. The pairing of the mark with the particular category of product must appear to be random. The strength of these marks are inherently distinctive and they are of the strongest of marks. An example is Apple. Apple is a trademark because computers bear no relation to the actual term, apple, which is a fruit. So if an individual company was selling apples, they couldn't get a trademark for Apple's apples because that would be quintessentially generic.

  But when you're selling computers, no one thought, and at least in the beginning, when you think of a computer, you think of an apple. Or when you see an apple with a bite out of it, you immediately think of a computer. So that is an arbitrary mark because the word "apple" is popular in our English vocabulary. But prior to getting a trademark, it was not associated in any way with computers. There are many other examples of an arbitrary mark. So these are great marks to try to get your trademark for. But as indicated earlier, they don't always have the immediate association with the consumer like a suggestive mark. So the next example and the final example is a fanciful mark. This is different than an arbitrary mark because a fanciful mark is not a word that exists in the popular vocabulary. Fanciful marks are "terms that are invented for the sole purpose of serving as trademark and have no possible association with the product for which it is used." The strength of these marks are, again, inherently distinctive and of the strongest strength.

  Infringers of these marks are hard-pressed to provide any explanation for their using the mark, leaving the impression that the real reason for their use was a blatant attempt to trade off the goodwill generated by the owner of the trademark. An example of this as alluded to earlier was Xerox. Xerox, capital X, little E-R-O-X, was not a word in the popular vocabulary prior to its creation by the Xerox company. It was trademarked because the word had no meaning outside of the context of Xerox, the company for copying purposes. The bottom line when it comes to strength of mark is that if one picks a stronger mark, like an arbitrary mark or a fanciful mark, it will be less likely to be unintentionally infringed. Ask yourself, what are the odds of two people independently coming up with the term or mark, Kleenex, to describe facial tissue, or aspirin to describe acetylsalicylic acid? Not likely. Furthermore, if one does infringe a stronger mark, it will most likely be easier to prevail in court when trying to prove infringement.

  So again, with regard to the fanciful mark, going back to Kleenex, Kleenex nowadays is almost synonymous with facial issue, but Kleenex was a made-up word that was actually created to sell brands of facial tissue. And so it is very important to the Kleenex company, the company that makes Kleenex, that you do not associate too closely facial tissue with Kleenex. "Hand me a Kleenex, hand me a Kleenex." Well, if you are saying that and meaning, "Hand me a Kleenex brand facial tissue," then the company loves that because that means that their brand is at the top of your mind and it is the brand you want to use. But if are simply referring to any facial tissue by any company that puts it out, regardless of quality or quantity, cost or marketing channels, and you simply say, "Hand me a Kleenex," and all you mean is, "Hand me a facial tissue to blow my nose," then the company that puts out Kleenex will not like that because what started off as a fanciful mark is turning into quite quickly a generic mark, and that is not what the company wants.

  The company wants it's arbitrary, or fanciful, or even suggestive marks to maintain their inherent strength so that they provide the company, the unique perception among the consuming public. Now, we are going to move on to the last section, which is a thorough analysis of a current case of trademark infringement. We will discuss the facts of the case. The case is New Flyer Industry Canada ULC versus Rugby Aviation, LLC. It's found at 405 F.Supp.3d 886. It came out of the Western District of Washington in 2019. So in the next 20 minutes or so, we will spend a few minutes discussing the facts of the case. We'll discuss the issue in the case, which is obviously trademark infringement. We will discuss the rule regarding infringement as it applies to the case, focusing most on the likelihood of confusion factor. And we'll discuss the analysis of the court's reasoning in the New Flyer case. And finally, we'll discuss the conclusion of the court in the New Flyer case.

  So for all of you, that should sound very familiar because we are going to journey back to law school and practice the IRAC procedure: issue, reasoning, analysis, and conclusion. So with that, let us move to a thorough analysis of the New Flyer case. Again, this was case out of the Western District of Washington. It's found at 405 F.Supp.3d 886. And it was handed down in September 3rd, 2019. It is basically a bus manufacturer who brought an action against an airline owner claiming among other things, trademark infringement. And the airline owner moved for summary judgment. And the question was, was there a likelihood of consumer confusion? And the court went through a great deal of time and effort to discuss all the facts and all the factors that went into deciding whether summary judgment should or should not be granted with regards to whether it was likely that there was confusion among the public with regard to these two companies and their logos.

  You will have in front of you or will be provided a copy of the case. And therefore, you'll be able to actually see the logos or marks that we're talking about. So let's discuss the order which granted the defendant's motion for summary judgment. So this case arises out of what appears to be the unintentional use of very similar trademarks by two companies. The one company was San Juan Airlines and the other company was New Flyer Industries. New Flyer brought the claim for trademark infringement against San Juan Airlines. So New Flyer is the bus company. San Juan Airlines obviously is the airline company. And San Juan Airline moves for summary judge saying, "There's no way that we can be infringing this trademark." So New Flyer estimates that it occupies approximately 43% of the market share for buses. New Flyer does not own any buses itself and it doesn't sell any bus tickets or operate any bus lines itself. That's all done by the customers. But it is the manufacturer of buses.

  New Flyer has a major presence in the King County region. However, it does not do any business in the San Juan Islands and its customers do not include Whatcom Transportation Authority, which is all very closely associated with the airline company. Now, San Juan Airlines is a small company based in Bellingham. It has only about 20 employees, only five propeller planes, and they only have about five passengers on each of those planes, and they focus on charter flights. So again, this is a small company. Now, the San Juan Airline and the New Flyer logos were very, very similar. You'll see them in the handouts that you're provided. New Flyer's logo is comprised of two concentric circles, centered below two wings consisting of three feathers each. So it looks like the American Airlines, I believe, it was, symbol, but it has New Flyer underneath. The company registered a black and white logo back in 2007 and color was not actually claimed as a feature of the mark. And it was registered for use on buses, obviously not used on airlines since it's a bus company.

  Couple of months later, New Flyer applied for protection of its mark with the color orange and blue for uses on buses, and that is actually the mark that is issue. Now, San Juan Airlines' logo is very similar. It also has the three wings, the concentric circles, but it says obviously, San Juan underneath, and then airlines. Now, one of the individuals that was a witness in this case and a main individual, the graphic designer of the airlines, Mr. DeVere, he stated that his main inspiration for the design was the wing pins he received as a child from airline pilots. He said he was not aware of New Flyer's logo at the time and it was simply his childhood memory. And he testified that he would not have felt it was appropriate to have San Juan Airlines use the logo that he designed had he been aware of New Flyer's logo at the time, because it was too similar. And you'll see that that testimony actually becomes important later on.

  So New Flyer brought the claim for trademark infringement against the airline, and the court set out the legal standard and this is summary judgment. And so the court stated that a party is entitled to summary judgment if it shows that there's no genuine dispute as to any material fact, and that the party moving for summary judgment is entitled to judgment as a matter of law. And the court emphasized that the proper question is whether viewing the facts in the non-moving party's favor, that summary judgment for the moving party is appropriate. But the court also emphasized that summary judgment is generally disfavored in trademark arena. This is because it's so fact intensive. The court went on to say that the likelihood of confusion is a factual determination and district courts should grant summary judgment motions regarding likelihood of confusion, only in the most sparing instances.

  And so then the court went on to talk about trademark infringement. And they said, as we've talked about earlier, "Likelihood of confusion is the basic test for trademark infringement." And they indicated that assessing the likelihood of confusion involves a determination, whether the similarity of the marks is likely to cause confusion about the source of the products. And we've already talked about this. And the court indicated that a likelihood of confusion exists when a consumer viewing a service mark is likely to purchase the services under a mistaken belief that the services are/or associated with the services of another provider. So again, going back to the Kleenex example. If there was Kleenex by one company and Kleenex by another company, obviously, if you're buying the Kleenex, you're thinking of the company that came up with the Kleenex trademark, not the knockoff. So the court said that in assessing this, the confusion must be probable, not simply possible.

  And so there has to be something more than just possible confusion. And they also talked about the use of the mark from the senior user, which is the first one to use it, and the later user. And so they provided the facts of the case with regards to when the goods produced by the alleged infringer compete for sales with those of the trademark owner. And the infringement will usually be found if the marks are sufficiently similar that confusion can be expected. Again, a likelihood of confusion. And the court pointed out that when the goods are related, but not competitive, several factors are added to the calculus. And they said that the related products or services are those that raise the likelihood of confusion to be greater. So they don't need to be identical, but they're related in the minds of the consumers.

  And it needs to be, would it be reasonably thought by the buying public to come from the same source if sold under the same mark? So one of the ones that I often bring up is Lexus, the car manufacturer, and Lexis, the legal research company. Although they're spelled different, they sound very much alike, but would a consumer that is used to buying Lexus cars think that the Lexus car company is also providing legal research tools? Probably not. So that's an example of where the goods are totally unrelated. And in that case, there can be no infringement because confusion is unlikely. So getting back to the facts of the case, New Flyer argued that its goods and services are both related to those of San Juan Airlines as they are both "modes of transportation offered in the same geographic region," even if New Flyer does not compete with airlines. So they're taking a very broad look at their mark.

  And geographically speaking, New Flyer does not do any business in the San Juan Islands and does not supply buses to Whatcom. So that's less likely that there's going to be infringement. And San Juan Airlines is based in that Whatcom County, and approximately 90% of its reservations are made by individuals or companies with addresses within 30 miles from Bellingham Airport. So again, less likely that there's going to be a confusion. So the court pointed out that the likelihood of consumer confusion is diminished since neither the plaintiff nor defendant sell or try to sell anything within the same territory that the other does business. New Flyer is not selling airline tickets, San Juan Airlines is not providing buses. So the court noted that there may be no consumer confusion if the infringer is in a different geographic area from the complainant, or is not providing the same type of products.

  So the court went on after laying out the facts and went into what they call the Sleekcraft factors. And so the court proceeded with analysis of the several factors known as the Sleekcraft factors, and it came from a speedboat case where two speed boats were similar. Trademarks were being assessed as whether there was possible infringement. And the Sleekcraft factors, the court pointed out, are intended as "an adaptable proxy for consumer confusion, not a rote checklist," which the court meant by that is there's going to be eight factors. You don't simply say, "Well, I won five factors, you won three. So therefore, there is, or is not infringement." This is just simply a guidance and you're supposed to review the factors and then make an independent determination. So the court pointed out that granting summary judgment in cases in which a majority of the Sleekcraft factors could tip slightly in either direction is actually inconsistent with the whole analysis.

  Because it's supposed to just provide a guidance, and then you're supposed to make a logical conclusion based upon that. And so it went through the factors. And in this case, there was eight enumerated factors. I had said earlier that some courts rely on seven, some rely on eight because sometimes they break out the seventh into an eighth. But here, the eight factors are strength of the plaintiff's mark, proximity or relatedness of the goods and services, that's two. The defendant's intent in selecting the mark, that's three. Four, the evidence of actual confusion. That's four. The marketing channels used, that's five. The likelihood of expansion into the mark, that's six. The degree of care or likely to use exercised by the purchasers, that's seven. And the eighth one is the relatedness of the goods and services, which goes hand in hand with the proximity of the goods and services. So reviewing the first one, which is strength of the mark.

  The court pointed out that the more likely a mark is to be remembered and associated in the public mind with the marker's owner, the greater protection the mark is accorded. And so they're talking about the strength of the mark being with regards to conceptional strength and what it does to the mind of the consumer. And the court went over all the marks of the five different strengths that we've already discussed, which was generic, descriptive, suggestive, arbitrary, and fanciful. And court pointed out that it assesses the mark's commercial strength by considering its actual marketplace recognition. On the one hand, it may consider evidence of substantial advertising expenditures, substantial sales, and widely distributed advertising campaigns, and that would be sufficient to make a relatively commercial mark strong.

  So when the court reviewed the strength of the two marks, the court indicated that the first factor, which was strength of the mark actually resulted in the overall... The factor weighs slightly in favor of New Flyer because of the strength of the mark. Being that it was not associated with buses, the wings doesn't go with a bus necessarily, and so that would be something more suggestive of being able to get someone someplace quickly through the bus, but not immediately associates wings with buses. Then the court reviewed the second factor, which was the proximity of the goods. And the court pointed out that New Flyer's buses are not complementary to or similar to the use of the function of the San Juan Airline tickets. So again, proximity of the goods. We're talking about bus manufacturing services versus airline flights, charter flights, and the court actually came down and said that factor weighs in favor of San Juan Airlines, because obviously there is not a proximity of the goods, bus manufacturing and charter airlines.

  The third factor that the court reviewed was the similarity of the marks themselves. As you can see in your presentation, just take a look at the marks and you can see that the marks are very, very, very similar. And so the court concluded that this factor weighs in favor of New Flyer, the bus manufacturer. Next, the court talked about evidence of actual confusion. And the court pointed out that evidence that use of two marks has already led to confusion is persuasive proof that future confusion is likely, but they also pointed out that proving actual confusion is difficult, however, and the courts have often discounted such evidence because it is unclear or unsubstantial. In this case, there was no actual confusion. No one got on an airline thinking it was a bus and no one got on a bus thinking it was an airline. I'm being somewhat facetious, but there was no actual confusion between the two companies. So this factor therefore strongly weighed in favor of San Juan Airlines, because there was no actual confusion.

  It then went on to talking about the marketing channels that the two companies used. And the court explained that the convergent marketing channels increase the likelihood of confusion. So if the parties have consumers that overlap, then there's going to be a likelihood of consumer confusion. And the court went through the different marketing channels that each company uses and the fact that there was website use, and magazine use, and general public perception. But they said that ultimately, there was a significant difference in the marketing channels that this factor weighed in favor of the airlines. So that is not surprising. They moved on to the sixth factor, which was the type of goods and the degree of care. And they said that in assessing the likelihood of confusion to the public, the standard used by the courts is the typical buyer exercising ordinary caution. So what we're looking at here is the typical buyer of a bus and what caution do they use in buying a bus? Compared to the typical buyer of an airline ticket, charter airline ticket, and what caution do they use?

  And the court generally agreed with San Juan Airlines and said that there was a significant difference between the degree of care that the buyer of a bus would exercise compared to the consumer that bought an airline ticket. And so you don't typically just go out and buy a bus without doing your research and making sure that the company that's selling you the bus isn't an airline. So this factor weighed in favor heavily of San Juan Airlines. Then they went on to San Juan's intent, and they went through the intent and they showed, as we indicated, that the actual brainchild of the logo was based upon childhood memory of getting wings and there was no evidence of knowingly designing a logo that was similar. And so that factor too weighed heavily in favor of San Juan Airlines. And then the last factor that they discussed was the possibility of expansion. And the court pointed out that a strong possibility that either party may expand his business to compete with the other will weigh in favor of finding that the present use is infringing.

  So the question became, is the bus company looking to expand into the aviation industry? And similarly, is the aviation industry thinking of expanding into the bus company? And they found that there was no evidence of either company expanding into the other. So that also weighed against a finding of infringement. And so the court ultimately stated that the use of admittedly similar logos by San Juan Airlines and New Flyer is nevertheless unlikely to result in any consumer confusion. The court pointed out that San Juan Airlines sells flight tickets to the San Juan Islands and surrounding areas, New Flyer manufacturers and sells buses to transit agencies in a highly regulated process initiated by the agencies themselves. The court went on and said, the goods and services are unrelated beyond a semantic affiliation with the transportation industry.

  San Juan Airline customers are individual travelers, and New Flyer's customers are transit agencies. The court pointed out that a member of the public does not choose to ride a New Flyer bus over another bus. He or she simply uses the public transportation system available in his or her region. By contrast, the court pointed out, a tourist traveling from Bellingham Airport to San Juan Islands specifically chooses to purchase a ticket on San Juan Airlines over other airlines offering the same flight. So therefore, the court concluded there is no overlap in the customer base or marketing channels. There is no evidence of actual confusion, and there is no evidence that San Juan Airlines knowingly adopted a mark similar to New Flyer's. So based upon those statements, the court concluded, "Viewing the facts in New Flyer's favor, San Juan Airlines is entitled to summary judgment as a matter of law on its trademark infringement."

  So therefore, even though, and I chose this case specifically because the marks are so similar, even though the marks are so similar, there was no infringement found because applying the eight factors of the Sleekcraft's case and looking into the crux of the issue, which is likelihood of confusion, there was no likelihood of confusion. And so with that, I want to conclude this presentation by emphasizing three things. One, make sure you review the US PTO website at www.uspto.gov. Review their links to get the basic trademark background information. Second, review the 11 pet peeves that I discussed above from the particular PTO trademark examiner. And third, reread this case because it's an excellent example how it's an analysis and not a checklist. And so even though marks are very similar, that does not necessarily lead to the conclusion that there's infringement. So with that, I thank you very much. I hope you enjoyed it and I hope you learned a lot about basic trademark law.


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1h 4m 36s

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