adidas' cancellation action against church rekindles debate on what constitutes use in interstate commerce

United States of America

In order for a trademark to be registered/maintained in the United States, the mark must be used in interstate commerce, or foreign commerce with the United States. Mere use of a mark inside of a single US state, namely intrastate commerce, is not sufficient. This rule applies because the federal trademark law exists pursuant to the commerce clause of the federal Constitution and, under that clause, the US Congress can regulate activity only where it affect commerce between states or with other nations, not where activity occurs only within one state.  

In adidas AG v Christian Faith Fellowship Church (Cancellation No 92053314), the Trademark Trial and Appeal Board (TTAB) has cancelled two federal trademark registrations for ADD A ZERO, owned by the Christian Faith Fellowship Church, on the grounds that the Illinois church’s sale of just a few apparel items at its bookstore to out-of-state parishioners did not meet the interstate “use in commerce” requirements within the meaning of Section 1(a) of the Lanham Act.

This cancellation clears the path to registration for adidas’ application for ADIZERO, the mark used by the company’s line of super lightweight athletic apparel and footwear. The application had been refused registration in 2009 by the US Patent and Trademark Office under Section 2(d) based on a likelihood of confusion with the church’s registrations.

In the cancellation action, adidas primarily argued that the church’s mark had not been used in interstate commerce prior to the 2005 filing dates of its use-based applications, making the registrations void.  

Section 1(a) of the Lanham Act provides for federal registration of marks used in interstate commerce, or business between companies or individuals in different states. Intrastate commerce, or business between companies or individuals in the same state, does not satisfy Section 1(a).

While the TTAB accepted the premise that at least one of the purchasers of items bearing the ADD A ZERO mark was a Wisconsin resident at the time of purchase in 2004, they noted the sales and transfers of goods were made in the church bookstore in Illinois and were thus de minimis and insufficient to function as interstate commerce, only intrastate commerce. Therefore, Section 1(a) required the cancellation of the ADD A ZERO marks.

This cancellation may mark a substantial shift in the TTAB’s view of interstate commerce, bringing it closer to alignment with the Supreme Court’s interpretation than ever before. In the past, the TTAB had been generous in its analysis of the quantity and types of activity that were considered interstate commerce for the purposes of trademark registration, whereas the Supreme Court required activities that substantially affected interstate commerce to justify Congressional action under the Commerce Clause.

While the adidas decision is not precedential, the result should serve as a warning to future trademark applicants and current registrants, as a small amount of interactions with customers in other states, or the potential for goods to cross state borders, may no longer be substantial enough to establish interstate commerce and justify a federal trademark registration. Applications claiming interstate commerce under similar circumstances may be rejected and registrations based on comparable evidence may be at risk of cancellation.

Dennis S Prahl, Ladas & Parry LLP, New York

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