A Hoppy Halloween from all of us ghoulish folks here at DuetsBlog!
Spending for Halloween this year is likely to hit $11 billion dollars, possibly more than is spent decorating for Christmas. This fact is easily witnessed in many neighborhoods around town, especially this one where just about every house has some sort of Halloween decoration.
Although not pictured here, I also found a creepy Santa statute with a bloody head mere blocks from where a drunken zombie Santa recently traumatized some teenagers by unwittingly breaking into their home after a rough night out.
So with all this spending on Halloween, and the number of novelty items that can be purchased for the holiday, I thought it might be fun to peruse patents and patent applications for your trick-or-treating necessities.
First, there is the all-important costume.
In the age of Frozen, Transformers, Teenage Mutant Ninja Turtles, and Spiderman, you have to wonder what Disney, Marvel and Hasbro make off of costume licensing.
For your child, you’ll probably want something “weather and climate adaptive,” breathable, and reflective.
Your teenage boy probably wants something that oozes blood.
And you may just want something funny.
You’ll need a vessel for collecting candy.
The bigger and easier to haul around, the better. Wheels and a handle? Check.
Don’t forget to say “Trick or Treat.”
Here’s a patent application for a candy bag incorporating a speaker activated by a remote managed by the parent, where you can zap (er, gently remind) your trick-or-treater to say those magic words (along with a “thank you”).
This is a little creepy.
Have a safe and sugary Halloween!
"Rekindle your love of beautiful books" ad for print books
This litigation involves claims for patent infringement, copyright infringement, violations of the Lanham Act, and violations of the Uniform Deceptive Trade Practices Act based on ICM’s alleged copying of combustion control devices. A few months ago, the court kicked out Honeywell’s trade dress claim on functionality grounds and its false advertising claim based on ICM’s “Made in the USA” representations. While at the time it questioned the validity of false advertising claims based on trade dress similarity, it now administered the coup de grace.
Honeywell maintained that it wasn’t just challenging ICM’s copying of trade dress, but also ICM’s promotion of its products as “the same as” Honeywell products. ICM allegedly copied the appearance of Honeywell’s products “because that appearance gives contractors the impression that ICM’s products are ‘highly interchangeable’ with the range of Honeywell products they are intended to replace.” However, ICM’s products were allegedly not the same and not always highly interchangeable with Honeywell products, making ICM’s marketing false or misleading. Honeywell also argued that its history of making these products as “private label” products for third-party competitors contributed to the confusion.
The court was unconvinced. Functionality protects competition and consumers. The allegations didn’t show any false statement. Instead, ICM allegedly marketed products similar to Honeywell’s, which created a false impression of affiliation/sponsorship. “But Honeywell International has no protectable interest in its claimed trade dress. Trade dress infringement does not arise out of ICM Controls’ products; the marketing of those same products does not constitute false advertising.”
Comment: I would state the doctrinal result as one that an implicit performance message, if any, conveyed by copying functional features must be allowed, even if that causes some confusion, to police the boundaries of trademark and patent law. This is an unusual example of channeling from false advertising to trademark; more common is the other way around, where we usually require complaints about comparative advertising to be made under the head of false advertising with its stricter falsity, materiality, standing, and “advertising or promotion” requirements.http://tushnet.blogspot.com/feeds/posts/default?alt=rss
As a huge fan of gangster movies, I was intrigued by a recently filed lawsuit in California. Although I am familiar with actor Frank Sivero’s work in “The Godfather: Part II” and in “Goodfellas” (left side of photo below), I am not familiar with the accused “Louie” character on the Simpsons (right side of photo below).
Mr. Sivero sued Fox Television Studios, Inc. alleging that the Louie character constituted infringement of his right of publicity, misappropriation of his ideas, interference with prospective economic advantage and unjust enrichment. The right of publicity, also called “personality rights,” is a property right to control the commercial use of a person’s name, image, likeness, or persona.
The complaint contends that Mr. Sivero lived next door to the writers of the Simpsons in an apartment complex. They saw each other almost daily. During these encounters, Sivero states that he discussed the character he was creating to play in the “Goodfellas” movie. Sivero based the “Frankie Carbone” character on himself. As gangster movie buffs know, “Goodfellas” was nominated for six Academy awards. Joe Pesci won a best supporting actor award for his portrayal of “Tommy DeVito.” The character “Louie” is known as a “wise guy” and is part of the Springfield Mafia.
The Simpsons writers are known for modeling characters after real life people or real life characters from other shows or movies. For example, the Simpsons’ character “Moe the Bartender’s” voice is based on the real life voice of acting legend Al Pacino’s voice. Likewise, Simpsons’ character “Dr. Julius Hibbert” is based on Bill Cosby’s character “Dr. Cliff Huxtable” on the popular “Cosby Show.” Further, character Mayor Quimby is based on President John F. Kennedy from his days in Camelot. Finally, Ranier Wolfcastle the agitated action hero movie star is based on Arnold Schwarzenegger.
Will this case go to trial or will there be a settlement offer by Fox that Mr. Sivero cannot refuse?
Precedential No. 41: Finding Fraud, TTAB Sustains Opposition to NATIONSTAR for Real Estate Brokerage Services
Applicant Ahmad prepared and filed the use-based application himself on April 20, 2006. After the opposition was commenced, applicant filed a motion to amend the filing basis of his application to intent-to-use. In June 2008, the Board granted the motion to amend, but noted that "amending the filing basis of the opposed application to Section 1(b) does not protect the application from the fraud claim."
Fraud must be proven with clear and convincing evidence. A false statements made with a reasonable and honest belief of its truth is not fraud. There must be an "intent to mislead the USPTO into issuing a registration to which the applicant was not otherwise entitled."
The Board again pointed out that once an opposition has been filed, "fraud cannot be cured merely by amending the filing basis for those goods or services on which the mark was not used at the time of the signing of the use-based application." Moreover, the statement as to use of the mark for particular goods is "unquestionably material to registrability."
Applicant Ahmad testified that he chose the name in 2004-2005, after checking the Virginia corporate records and the USPTO databases. In April 2005, he registered several domain names containing the word "nationstar." In early April 2006, opposer Nationstar Mortgage contacted Ahmad, offering to buy two of the domain names. Within days, Ahmad filed the application at issue here.
Ahmad is a real estate agent in Virginia. He was not a real estate broker, insurance broker, or mortgage insurance broker, each of which require a state license, at the time of filing his application to register.
Ahmad's testimony regarding use of the mark NATIONSTAR as of his filing date was of grave concern to the Board, due to his "evasiveness and failure to respond directly to straightforward questions." For example, he could not identify which printed materials he created and which were created by others, he claimed not to know whether his business earned any income, and he dodged questions about filing tax returns. The Board found his testimony "so lacking in conviction and credibility as to be virtually incapable of corroboration." The documents that he provided were of "virtually no probative value" because he could not state who created them or when.
The Board observed that, as a real estate agent, Ahmad was well aware that legal documents must be carefully reviewed prior to signing. According to his testimony, Ahmad was well aware of the restrictions on real estate agents and he knew that separate licenses are required for brokers.
In short, the Board found Ahmad's testimony to be "not at all credible," and it concluded that Ahmad was not using the NATIONSTAR mark with any of the recited services prior to his filing date. At most he may have rendered real estate agency services prior to the filing date, as corroborated by two witnesses. Those services, however, were not listed in the application.
The Board next found that the false statements made by Ahmad were made knowingly and with an intent to deceive the USPTO. It noted that the law does not require "smoking gun" evidence of deceptive intent; direct evidence of deceptive intent is seldom available. Therefore, deceptive intent may be inferred from the surrounding facts and circumstances. Here, the surrounding facts and circumstances "provide clear and convincing evidence that applicant did not have a good faith reasonable basis for believing that he was using the NATIONSTAR mark in commerce for all the services identified in the application."
The Board distinguished this case from In re Bose, where it was not unreasonable for the corporate officer who signed the Section 8 declaration there at issue to believe that the mark was in use in interstate commerce. Here, there is no nuance of trademark law that applicant may have incorrectly interpreted. Instead it involves an applicant making false statements about his own industry and his own activities, knowing that he did not have the appropriate licenses.
The fact that Ahmad filed the subject application himself did not give him "a free pass to disregard the straightforward requirements of a use-based application and the solemnity of the application declaration that he signed subject to criminal penalties under 18 U.S.C. Section 1001."
The Board therefore sustained the opposition, declining to consider the additional grounds of likelihood of confusion and lack of bona fide intent.
Read comments and post your comment here
TTABlog note: What do we learn from this decision? How did Ahmad think he was going to avoid a fraud finding? It is good to see that there are indeed some serious consequences to filing a false declaration.
Text Copyright John L. Welch 2014.
Priority: Applicant MedLink sought to tack on to to its use of the AGENTLINK mark, its earlier use of the mark "MedLink." Of course that didn't fly, because tacking requires that the two marks be "legal equivalents." And so applicant was stuck with its fling date of October 21, 2010 as its priority date.
Opposer Lighthouse, on the other hand, failed to establish technical trademark use of its AGENT LINK mark prior to applicant's filing date. Lighthouse first rendered its services no earlier than October 25, 2010, when it executed a contract for the sale of its services to a single customer. In fact, there was no evidence as to when the services were actually performed, but in any case this lone "sale" occurred after applicant's filing date.
Lighthouse, however, asserted that it had earlier use analogous to trademark use. To establish same, it had to prove that its prior use of AGENT LINK was sufficient to create an association in the minds of consumers between its mark and its services. A direct association need not be shown, but opposer had so show that its activities were "reasonably expected to have a substantial impact on the purchasing public" in order to acquire proprietary rights in the mark.
Here, Lighthouse's evidence was insufficient. It acquisition of a fictitious name certificate, a domain name, and a toll-free number, and its contract with an IT firm regarding the sending of emails were activities in the nature of setting up a business. No potential customers were exposed to opposer's mark. Although opposer's website was up and running by April 2010, there was no evicence as to the impact of the use of AGENT LINK on the website: i.e., there was no evidence that anyone actually visited the website. Nor was there any evidence of the effect of Opposer's email campaigns. Opposer had email exchanges with 15 potential customers, too few to "translate into public exposure of AGENT LINK with Opposer."
The Board concluded that these efforts were insufficient to establish use analogous to trademark use. Since opposer had the burden of proof with respect to its claim of priority and likelihood of confusion, its Section 2(d) claim failed.
Fraud: Opposer's fraud claim hinged on the contention that applicant's CEO had actual knowledge of opposer's prior use of the AGENT LINK mark. Therefore, when the CEO signed the application to register, he could not have believed that applicant was entitled to use the AGENTLINK mark and that no other person had the right to use AGENTLINK or a similar variation thereof.
The Board, however, found that the record evidence did not support opposer's claim. Applicant's CEO testified that he had no knowledge of opposer at the time the application was filed, and there was no reason to doubt his testimony. Opposer's assertion that it mailed promotional material to applicant prior to the filing date did not establish that the CEO received and reviewed the material.
Given that fraud must be proven to the hilt, we find that even if Opposer had shown that Applicant had received the solicitation letter and/or email prior to Applicant's executing the application declaration, receipt alone does not prove that Applicant knew that Opposer had any rights, much less, superior rights in the AGENT LINK mark, or that Applicant believed that its use of its mark would be likely to cause confusion. Moreover, the parties’ services are not substantially identical and, therefore, Applicant's belief that there was no likelihood of confusion resulting from the parties’ concurrent use of their respective marks in connection with their respective services was not unreasonable. Quite simply, Opposer's evidence falls far short of meeting the standard of proof for fraud, and its ground that Applicant committed fraud in executing the application declaration is therefore dismissed.
Read comments and post your comment here
TTABlog note: A clearly bogus fraud claim. For a successful fraud claim, the rarest of birds, see last month's Nationstar case TTABlogged here].
Text Copyright John L. Welch 2014.
Titaness Light Shop, LLC v. Sunlight Supply, Inc., No. 13-16959 (9th Cir. Oct. 9, 2014)
Sunlight uses “Titan Controls” for devices that control indoor gardening equipment. Titaness Light Shop (TLS) began marketing indoor grow lighting systems under the mark “Titaness.” The court of appeals reversed the district court’s grant of a preliminary injunction as an abuse of discretion, given that such an injunction is an extraordinary remedy that requires a clear showing of entitlement to such relief.
The problem was irreparable harm, as to which conclusory or speculative allegations are not enough. Irreparable harm can include harm to reputation and goodwill, but evidence is required, not mere platitudes. Here, Sunlight “Sunlight simply asserted to the district court that its goodwill and reputation would be irreparably harmed because TLS’s Titaness products were being sold by a website that supposedly catered to marijuana growers, while Sunlight had worked hard to ensure that its products were not marketed to marijuana growers.” Yet Sunlight didn’t show actual or likely harm. It didn’t show that its customers were aware of the relevant website; would associate products sold by the site with marijuana; or disliked marijuana enough to stop buying Sunlight products if they mistakenly perceived a link to marijuana. Indeed, Sunlight was, at the time the appeal was argued, actually selling on that site as well.
Money quote: “The fact that Sunlight’s reputation might be harmed by the marketing of TLS’s products did not establish that irreparable harm to Sunlight’s reputation is likely.”http://tushnet.blogspot.com/feeds/posts/default?alt=rss
The court adopted the magistrate judge’s recommendation to grant defendants’ motion to dismiss unjust enrichment claims, but to deny the motion as to the consumer protection and warranty claims in this dog jerky contamination case.
Plaintiff Funke sued on behalf of a class of purchasers of chicken and beef jerky dog treats from Milo’s Kitchen, owned by Del Monte. She alleged that defendants misrepresented the quality of the treats, that they contained contaminants, and that after she fed the treats to her dog it became sick and ultimately had to be euthanized. Among the allegedly false/misleading claims on the products’ packaging and associated websites: “100% Real—Wholesome and Delicious;” the ingredient list; “Milo’s Kitchen Home–Style Dog Treats are 100% real jerky, sausage slices, and meatballs;” each piece of Milo’s Kitchen Chicken Jerky “is made with whole fillets of 100% real jerky and the quality and care your dog deserves,” without any artificial chicken flavors or filler ingredients; and claims that their products comply with USDA, FDA and other food safety rules.
The FDA released numerous cautions to consumers about illness in dogs after consuming jerky treats made in China, as defendants’ were. Defendants’ statements that neither the FDA nor the American Veterinarian Medical Association have been able to identify the cause of the illnesses or a connection between the illnesses and the jerky treats and that no contaminants have been found despite extensive testing were allegedly deceptive. Funke further alleged that Milo’s safety process was deficient and that the FDA investigation failing to detect contaminants was fundamentally flawed. Moreover, defendants allegedly failed to respond adequately once the contamination was found.
Funke brought the usual statutory California claims. Defendants argued that the alleged misrepresentations were mere puffery. Along with those listed above, plaintiff identified other alleged misrepresentations: that defendants started making Milo’s Kitchen dog treats because they believed dogs deserve treats made with the same quality of ingredients and care that their owners want in their food; the jerky treats are good for pets; and dogs deserve only the best with your food and deserve to enjoy snacks that not only look like jerky, sausage slices and meatballs, but actually are 100% real jerky, sausage slices and meatballs.
Other than the statements about defendants’ motivations for making the treats and the claim that they’re “good for pets,” each of these appeared verifiable and sufficiently specific to induce reliance. Moreover, even the statements that were puffery standing alone could contribute to the deceptive context of the packaging as a whole.
Funke also satisfied Rule 9(b) by alleging that defendants “engaged in a continuous course of conduct since 2007 (the when), whereby they have made misrepresentations on the jerky treat packaging and on their websites (the where), that their products are wholesome, safe, and that they otherwise have characteristics and qualities that they do not have which is likely to mislead the public (the what), and that these misrepresentations are false because many of the packages of jerky treats contain contaminants (the how).” Funke also adequately alleged reliance.
Plaintiff Ruff’s claims fared similarly. (Her dog also died.) She challenged similar claims, including statements that the product is “100% REAL”; that it was made with “the quality and care your dog deserves”; and that the jerky treats are “wholesome natural treats.” She also challenged Milo’s response to the FDA’s warnings as misleadingly downplaying the evidence and failing to warn consumers of the dangers. She contended that neither she nor any reasonable person would have bought the jerky treats if they had known of the material risk of serious harm to their pets. Along with the usual California claims, she alleged negligence and strict product liability.
The court found that Ruff adequately alleged a defect and proximate cause. While an accident alone isn’t sufficient to prove a defect, defects can be alleged by circumstantial evidence such as that present here: Ruff bought a package of treats which she fed to her healthy dog; with no other material changes to its diet, it fell ill; it died from kidney failure within one week of consuming the treats; since Nov. 2011, the FDA has logged over 900 reports of illness and death from kidney failure in pets after consumption of jerky treats.
The court also found that Ruff could represent a nationwide class for her California UCL and CLRA claims, even though she wasn’t a California resident. California law may be applied when the defendant is a California corporation, as here, and some or all of the alleged misconduct emanated from California, as alleged here, where Ruff pled that California was the headquarters for Del Monte’s US marketing and that the California location provides all customer support and makes all corporate decisions regarding marketing. She could also bring a North Carolina UDTPA claim, because she lived there.
Ruff’s Magnuson-Moss Warranty Act claims for breach of the implied warranty of merchantability survived even though there was no privity. The rule requiring privity has an exception for “foodstuffs,” and there was no reason to limit that exception to human food.
Not surprisingly, the Board found the marks to be similar in connotation and commercial impression, since SIMPLICITY is the first and dominant portion of the applied-for mark.
As for the goods, Opposer claimed to have broader rights that those provided by its registration. Relying on the "zone of natural expansion" doctrine and on its alleged common law rights, Opposer
asserted use of its mark on shampoos, conditioners, and conditioning oils, and urged that applicant's goods are nearly identical, or within opposer's zone of expansion.
Asserting that applicant had acted in bad faith, opposer pointed out that after the opposition was filed, applicant altered her packaging so that the word "Simplicity" in a vertical display, with the words "Hair Oil Display" greatly reduced in size.
The Board was sympathetic to opposer's position, but opposer had relied only on its registration in its notice of opposition. There was no claim of prior common law use of the mark. Applicant had no notice of such and allegation, and "despite Applicant’s non-participation during the trial of this case, we cannot treat the silence of Applicant qua defendant herein the same as finding that the issue was tried by the consent of the parties."
Moreover, opposer failed to provide adequate evidence that the involved goods are related. Opposer provided copies of its own webpages, showing that opposer sells a variety of hair-related products, but that was not enough to establish that consumers would view the involved goods as related.
[I]n addition to an absence of any notice to Applicant that Opposer would be relying upon possible common law usage of the cited mark on disparate goods, there is no factual basis in this record on which to conclude that oils for hair conditioning would be perceived by consumers of hair extensions as falling within the natural zone of expansion of a manufacturer of wigs and hair pieces.
Since the relatedness of the involved goods was not established, the Board say no need to consider "the complexities of the 'natural expansion' doctrine as an end-around this critical du Pont factor."
And so the Board dismissed the opposition.
Read comments and post your comment here
TTABlog comment: It's often difficult for a plaintiff when the defendant adopts the rope-a-dope strategy. It means the plaintiff has to do everything right, with no help from the defendant's errors or actions.
Text Copyright John L. Welch 2014.
A combination of descriptive words is not necessarily merely descriptive. The combination may create a unitary mark with a nondescriptive meaning or a bizarre or incongruous meaning. The examining attorney maintained that the individual words are descriptive and the combination is merely descriptive and laudatory of the services.
Applicant Dan Wison lamely, and rather incoherently, argued as follows:
The characteristics of Applicant’s services are such that they are suggestive and descriptive at the same time. Upon perception of the mark, the consumer may recognize
that [it] is for video content. However, the mark only suggests at the show’s format. The mark suggests that [sic] show involves politics and rap battles, but it does not reveal much about the content, how it is structured, or who is performing.
The Board was understandably unimpressed, and it agreed with the examining attorney: "the phrase POLITICS FUNNIEST RAP BATTLES immediately informs potential consumers of Applicant's entertainment services about the subject matter or content of the material, namely funny rap battles involving politics or in Applicant's words, 'rap battles between political figures.'"
Applicant Wison further asserted that there are "any number of other alternative marks that a competitor could use to describe a similar service." The Board pointed out, however, that the existence of other descriptive terms "does not redeem an otherwise merely descriptive word or phrase."
Finally, Applicant contended that competitors do not need to use the applied-for mark to describe their services, and that he was not aware of any other entity using the same phrase for entertainment services. The Board observed once again, however, that even if applicant were the first and only user of the mark, the mark would still be merely descriptive under Section 2(e)(1).
And so the Board affirmed the refusal.
Read comments and post your comment here
TTABlog comment: Well, would you have?
Text Copyright John L. Welch 2014.
Think an undefended opposition proceeding is a slam dunk, then you better think again. In Emminence, LLC v. Lisa Kelly, Opposition No. 91205286 (October 8, 2014), the Trademark Trial and Appeal Board dismissed an opposition proceeding even though the defendant did not offer any evidence or even a trial brief in support of her case. Even though Ms. Kelly clearly demonstrated her intention to not defend herself in the opposition proceeding, the Board found that the plaintiff failed to offer sufficient evidence of the relatedness of the goods, so the opposition was dismissed.
If a plaintiff fails to prosecute an opposition proceeding, a defendant can move for a directed verdict at the close of the plaintiffs testimony period. However, no similar motion exists for a plaintiff against a defendant that chooses not to defend itself.
In one sense, the lack of a motion could be a useful strategy against a trademark bully. The party that is bullied can choose as a strategy to not engage the bully in the proceeding and allow the Board to do the bullied party’s bidding. Giving up control like this may not be ideal, but is a cheap strategy.
However, the likelihood of using such a strategy is low and should not justify the absence of a motion for a directed verdict for a plaintiff in an opposition proceeding. The more likely situation is a defendant that has no interest in defending its right to a registration, yet unjustifiably increases the cost of litigation to the plaintiff by not defending itself after filing a bare bones answer.
- Debbie Laskey, MBA
Who owns the brand in your business? If your business is top heavy with numerous members in the C-Suite, this may be a difficult question to answer if you don’t have a Chief Marketing Officer. Your Chief Sales Officer may claim ownership, or your Chief Information Officer may claim ownership. Perhaps, your Chief Legal Officer may claim ownership. If you don’t have a large number of people in your C-Suite, your Chief Executive Officer may be the face of your brand and simultaneously leads your messaging.
But no matter who owns the brand in your business, there are three key responsibilities for the person in this role.
First, make sure that all brand tools are consistent. This means that all your digital assets including your main website, your blog, and all your social media accounts reflect the same look and feel; and make sure all your printed collateral also reflects the same look and feel (brochures, newsletters, flyers, annual reports, etc.). Make sure they all provide the same description about your company and brand, feature the same logo and/or tagline, and include the same color palette. For example, you would look twice and not trust a site with a purple Coca-Cola – those iconic red and white colors are as famous as the product they represent.
Second, make sure your brand has a defined voice. If you provide professional services, for example, legal or financial services, you may use formal language that matches your industry. But if you sell consumer products, your ads and emails may be full of informal lingo or slang. Think detailed emails versus brief texts. Also, depending on your industry, there may be appropriate words that would be considered essential to include in your brand messaging. For example, professional sports have terminology that is important in their branding – football ads can easily integrate “touchdowns” and “hail Mary’s,” and baseball ads can easily integrate “home runs” and “shut outs.”
Third, create brand advocates. As the owner of your brand, you want to welcome employees into the branding process so that they understand their importance in sharing your brand story with the world. Since all employees are brand advocates, take the time to educate employees about your brand’s strengths during the onboarding phase and also re-train on a regular basis. Make the training fun and always have a smile on your face.
What do you do as your brand’s owner? Please chime in.
Opposers contendedt that "Anthro" is used by its customers as a nickname or abbreviation for the store, Anthropologie, and as a reference to opposers' goods (clothing) or services, but the Board was not impressed. Although on rare occasion the Board has stated that even if a company has not itself used a term as a trademark, it still may have a protectable property right in the term [think IBM and BIG BLUE] if the public has come to associate the term with the company or its goods and services.
However, the use by the public of a term to refer to a company and/or its products or services does not mean that the company has obtained rights to exclude others from using the same term for [every] product or service, and it certainly does not mean that the company has obtained rights to register the term as a mark for [every] product or service.
Here, the evidence did not show that opposers sell beauty and cosmetic products under the ANTHROPOLOGIE mark. In short, Opposers failed to establish rights in the word ANTHRO for anything other than their customer loyalty program services.
However, the Board found that Opposer's loyalty program services, rendered in connection with their retail and Internet services featuring beauty and cosmetic products (under third-party marks) "are similar to" Applicant's personal care products. Noting that "it is well recognized" that when the same mark or similar marks are used for goods and for retail services featuring those goods, confusion is likely, the Board concluded that this du Pont factor favored opposers.
Furthermore the involved goods and services are offered through the same type of trade channels, and the purchasers would overlap. The goods and services are subject to "impulse purchase." [Loyalty programs are subject to impulse purchase? - ed.]. And Opposers "have enjoyed success with their loyalty program services under the mark ANTHRO." [So that means it's a strong mark? Or is it just a good program? - ed.]. The record was devoid of any third-party use of the same or similar marks.
Balancing the relevant du Pont factors, the Board found confusion likely and it sustained the opposition.
Read comments and post your comment here
TTABlog comment: Well, what do you think?
Text Copyright John L. Welch 2014.
Gedalia sued on behalf of a putative class of people who bought Whole Foods’s private-label 365 Organic and 365 Everyday Value products allegedly falsely labelled as being organic, natural, and/or GMO-free. Plaintiffs brought claims under various state consumer protection laws as well as common-law theories. The claims encompassed hundreds of different products; the court expressed doubt about plaintiffs’ standing to represent consumers of products they didn’t purchase, but didn’t resolve the issue because it ruled on lack of plausible reliance. Likewise, the court was skeptical that plaintiffs could bring claims based on online and in-store representations not present on the actual packages, because they didn’t allege they saw those representations.
The court did reject preemption arguments; the Organic Foods Production Act (OFPA) does not clearly indicate a purpose to occupy the field, nor did it conflict with relevant California law. Nor were “natural” claims impliedly preempted by the FDCA/NLEA. Reliance on the primary jurisdiction doctrine “would likely be unfruitful due to the agency’s long-standing reluctance to officially define the term ‘natural.’”
The sticking point was a misrepresentation that would be likely to deceive a reasonable consumer. This is usually a fact question unsuited for a motion to dismiss, unless “the advertisement itself made it impossible for the plaintiff to prove that a reasonable consumer was likely to be deceived.” Other cases have noted that there’s not much reason to think that consumers know or understand federal definitions of things like “organic” or “synthetic.” Williams v. Gerber, 552 F.3d 935 (9th Cir. 2008), held that consumers aren’t required to read the ingredient label to correct misleading impressions from the front of a package. In particular, a claim to be made with fruit and “other all natural ingredients” could reasonably be interpreted to mean “all the ingredients in the product were natural.” Subsequently, courts have generally held that the definition of “natural” is a question of fact, to be determined based on “contextualized evidence regarding consumer perceptions.” However, courts have also required pleadings to specify which ingredients are unnatural. And some healthy-sounding terms have been held to be puffery.
Here, the allegations were that 365 Brands deceptively include (1) non-organic ingredients in organic products, (2) GMOs and (3) Unacceptable Ingredients. Plaintiffs submitted hundreds of product label images, but none of the labels said “100% organic,” though they did have USDA and third-party certification seals. Plaintiffs alleged that the products include “synthetic ingredients that are not permitted in organic foods” and that “have not been approved to be used in any food at all, much less in organic food.” But they didn’t allege that the certifications were invalid or that the labels violated USDA regulations. OFPA allows non-organic ingredients in “organic” food, depending on the label. There was no reason to believe that “the reasonable consumer would assume 365 Brands organic products are any more organic than what organic certifying agencies require.”
GMOs: many of the labels stated that “365 Everyday Value products are formulated to avoid genetically engineered ingredients.” However, lab test results showed 365 Everyday Value Corn Flakes contained 57% GMO corn. The Whole Foods website directed consumers to buy 365 Everyday Value products if they wanted to avoid GMOs and stated that “[a]ll ingredients derived from plants are sourced to avoid GMOs, and hundreds of those products are verified by the Non-GMO Project.” However, another page on the website distinguished “enrolled” and “verified” non-GMO products. “While the website is not a model of clarity, the lab results and other evidence do not show 365 products were not ‘sourced to avoid’ GMOs, nor that verified non-GMO products contained GMOs.” None of the labels and literature stated that 365 Brands products were “GMO free.” (Really? Because that seems pretty misleading to me; the implicit message is clearly that there aren’t GMOs, even if it’s carefully worded to avoid making that explicit claim.)
As for Unacceptable Ingredients, that came from a list on the Whole Foods website. That list started with a bold disclaimer that Whole Foods reserved the right to change the list at any time, and appeared to be written for producers hoping to sell their products to Whole Foods. Plaintiffs alleged that they bought products containing Unacceptable Ingredients, including “irradiated foods” (cholecalciferol, ergocalciferol), “nitrates” (thiamine mononitrate), “artificial colors,” and “artificial flavors.” Whole Foods disputed the definition of “irradiated foods,” arguing that it targeted “the use of ionizing radiation in meat, produce, seafood and freestanding spice products, not obscure nutrient, vitamin, and mineral ingredients.”
Also, plaintiffs argued that all food coloring was “artificial,” even those made of “natural” ingredients, according to the FDA definition of “color additive.” They alleged that these ingredients didn’t meet the reasonable consumer’s understanding of the term “natural,” which “comports with federal law and Whole Foods’ proffered definition.” Whole Foods elsewhere defined natural foods as “foods that are minimally processed, largely or completely free of artificial ingredients, preservatives and other non-naturally occurring chemicals and as near to their whole, natural state as possible.” The USDA allowed “natural” on meat and poultry labels, as long as the products didn’t contain “any artificial flavor or flavoring, coloring ingredient, or chemical preservative, or any other artificial or synthetic ingredient” and provided that “the product and its ingredients are not more than minimally processed.” Elsewhere, regulations define synthetic as “[a] substance that is formulated or manufactured by a chemical process or by a process that chemically changes a substance extracted from naturally occurring plant, animal, or mineral sources.” While the FDA has no official “natural” definition, as a matter of policy it treats the term “as meaning that nothing artificial or synthetic (including all color additives regardless of source) has been included in, or has been added to, a food that would not normally be expected to be in the food.”
Because the FDA definition incorporated normal consumer expectations, it didn’t help with the reasonable consumer standard. The Whole Foods definition circularly defined “natural” as “not artificial” and “as near to [a] natural state as possible.” The USDA definition was more stringent, but was limited to meat and poultry. Still, Whole Foods didn’t offer an alternative definition that might include all the allegedly “artificial” ingredients plaintiffs challenged. Instead, it argued that the proffered interpretation was “based on arcane and technical regulatory definitions, not what a reasonable consumer would consider the terms to mean.” While whether reasonable consumers would consider an ingredient “natural” is a fact question, plaintiffs weren’t challenging the label “all natural” but were alleging misrepresentations based on the Unacceptable Ingredient list, from a page that plaintiffs didn’t show reasonable consumers would visit or rely on.
Plaintiffs also relied on images of advertising and signage that state, e.g., “Nothing artificial ... ever, ever, ever.” But none of the labels referred to the Unacceptable Ingredient list. The court couldn’t find references to “natural” or “artificial” ingredients on the submitted labels, though it was possible that they existed but weren’t legible on the submitted images. “Based on the images submitted, a reasonable consumer would not consider such drawings to be more than decorative graphics and would not rely on them in purchasing the products.” Plaintiffs argued that Whole Foods’ broad representations on its signs etc. belied the “dizzying array of ingredients” listed on its products. “But that is the purpose of requiring ingredient lists on every product label.”
Plaintiffs’ argument reduced to the idea that, “since Whole Foods has developed a successful brand as a provider of natural foods, it should be obligated to guarantee every molecule in every product it sells under its in-house brand is natural,” and likewise with “organic,” in spite of OFPA’s tiered labeling regime. Although the court commented that there’s an argument that organic labeling is inherently misleading, plaintiffs didn’t show how Whole Foods’ use of the term was any different from that of other organic producers, and the same was true of “natural.”
“Natural” cases allowing claims to proceed required “contextualized evidence regarding consumer perceptions,” but the claims here were far too broad. “The only common representation on the actual labels of 365 Products is a logo stating ‘365 EVERYDAY VALUE.’” This didn’t plausibly suggest natural ingredients, but rather suggests that the products were less than premium quality. http://tushnet.blogspot.com/feeds/posts/default?alt=rss