CAFC clarifies evidentiary prerequisites in opposition proceedings before TTAB

United States of America
The recent decision by the Court of Appeals for the Federal Circuit in Coach Services Inc v Triumph Learning LLC (Opposition No 91170112, February 21 2012), dismissing Coach Services Inc’s opposition to three COACH trademark applications filed by Triumph Learning LLC, provides a useful summary of the factors to be assessed in evaluating likelihood of confusion and dilution questions arising in trademark opposition proceedings. The decision also provides guidance on certain evidentiary issues and on the question of acquired distinctiveness, remanding the case to the Trademark Trial and Appeal Board (TTAB) for further analysis on that issue.
The Coach decision grew out of a trademark opposition filed by Coach, the owner of the well-known COACH marks used in connection with handbags, luggage, clothing and related accessories. Coach’s use of the COACH mark dates back to at least as early as 1961, and Coach owns 16 incontestable trademark registrations incorporating the term 'Coach'. Triumph began using the term 'Coach' in about 1986 in connection with books and software products designed to assist teachers and students in preparing for standardised tests. In 2004 Triumph applied to register three of its COACH marks - a word mark, a stylised mark and a mark combining the term 'Coach' with a caricature and the slogan 'America’s Best for Student Success'. Coach opposed, arguing that Triumph's marks were likely to cause confusion and dilution under 15 USC §§1052(d) and (c), respectively. Coach later amended its notice of opposition to include a claim that Triumph's marks were not registrable because the use of the term 'Coach' in connection with products designed to assist students and teachers in preparing for tests was merely descriptive and therefore not registrable under 15 USC §1052(e). The TTAB found no likelihood of confusion or dilution, and also held that Triumph's marks, although descriptive, had acquired secondary meaning and were thus registrable. Coach appealed. 
In reviewing a decision of the TTAB, the Federal Circuit reviews the TTAB’s legal conclusions from a de novo perspective, but reviews the factual findings using a “substantial evidence” standard, meaning that the TTAB’s factual findings will stand unless it is apparent to the court that the evidence presented was not such that a “reasonable mind” would have come to the conclusion that the TTAB reached.
The Federal Circuit began by addressing an evidentiary issue that would ultimately prove important from the perspective of Coach’s ability to prove its case. In particular, the court found that the TTAB had correctly determined that Coach had failed to properly make certain evidence of record during its testimony period.
Under the TTAB rules of practice, parties are required to submit during their testimony period the evidence upon which they will rely at trial. One mechanism for submitting such evidence is by way of a notice of reliance; however, material submitted by notice of reliance is, as with all evidence, required to have a certain degree of reliability. Under the TTAB evidentiary rules, documents that are “available to the general public” by way of libraries or general circulation are appropriately introduced by way of a notice of reliance. However, where documents are not so publically available, they may be introduced only through competent witness testimony as to the facts set forth therein.
At issue in the Coach case was a listing of annual reports for the years 2002 to 2008 submitted by Coach in its notice of reliance in support of its historical sales figures and advertising expenditures. Traditionally, annual reports have not been viewed as appropriately submitted by way of notice of reliance because they are typically not publically available. A 2010 decision of the TTAB, however, clarified that, where documents, including annual reports, are available on the internet, and where it is clear from the face of the documents where and when such documents were obtained (by including, for example, the date of printing and the URL), then a notice of reliance is an appropriate way to introduce such documents into the opposition record. The problem in the Coach case was that Coach did not provide internet printouts of its annual reports; rather, it submitted only hard-copy printed versions. In response to Triumph’s objection and motion to strike, Coach argued that the reports it had provided were also available online, and thus were essentially the same thing as the printed versions and should have been accepted.
Coach’s argument was unpersuasive. The court agreed with the TTAB that Coach's annual reports were not properly of record and thus could not be relied upon because Coach had failed to follow the TTAB rules. The court also agreed with the TTAB’s decision not to give credence to witness testimony that touched upon the annual reports submitted by Coach. Coach’s failure to show the reports to its witness during testimony, taken together with the witness’s vague statements about the advertising and promotion done in one year, simply did not provide a sufficient basis for the TTAB to conclude that information contained in the collection of submitted annual reports was reliable.
Turning to the likelihood of confusion question, the court explained that a determination on the confusion issue must be made on a “case-by-case basis” by applying the relevant non-exclusive factors set out in DuPont. The court concluded that the TTAB had correctly found no likelihood of confusion because the parties’ marks have “different meanings and engender different commercial impressions”, and because “the goods involved are not similar or related in any way”. Although the TTAB and the court recognised that the COACH marks were well known - indeed famous from a likelihood of confusion perspective - and that famous marks enjoy a “wide latitude of legal protection”, the court pointed out that fame, in and of itself, is insufficient to establish likelihood of confusion. Reviewing the other DuPont factors relevant in this case, the TTAB had found (and the court agreed) that:
  • the parties’ goods were not similar;
  • the parties’ goods moved in different channels of trade;
  • the parties’ marks have different meanings and engender different commercial impressions; and
  • Triumph marketed its products to sophisticated purchasers likely to exercise a high degree of care in making purchasing decisions. 

Thus, notwithstanding the fame of the COACH marks and the fact that the classes of consumers might overlap, on balance, the facts underlying the DuPont factors weighed against a finding that confusion was likely.

The court also agreed with the TTAB that Coach had not carried its burden to show that Triumph’s marks were likely to dilute the distinctive nature of Coach’s marks. The court explained that the question of whether a trademark is sufficiently famous so as to be capable of being diluted by another mark is different from whether a mark is famous for likelihood of confusion purposes. In the dilution analysis, fame requires a more stringent showing (it is a difficult-to-prove 'either/or' proposition), as opposed to the likelihood of confusion analysis, where the fame of a mark is more easily established and is viewed on a sliding scale, with the strength of the mark directly proportionate to the degree of fame. According to the court, the touchstone in a fame analysis is whether the mark owner has demonstrated that “the common or proper noun uses of the term and third-party uses of the mark are now eclipsed by the owner’s use of the mark” (ie, that “when the general public encounters the mark in almost any context, it associates the term, at least initially, with the mark’s owner”).

In this light, the court agreed with the TTAB that Coach had not provided sufficient evidence of fame to support a dilution claim. Mere advertising and sales evidence is insufficient, and the TTAB had correctly determined that the annual reports which formed the basis of Coach’s sales and advertising expenditures were unauthenticated and inadmissible. Similarly, while Coach argued that its multiple trademark registrations were an important element of its fame argument, the court agreed with the TTAB that registration, in and of itself, could not logically equate to fame (although it clearly is one factor to be evaluated). The TTAB had also properly discounted Coach’s evidentiary submissions in support of its claim that the COACH marks were the subject of widespread media attention. Importantly, much of the evidence submitted by Coach in this regard was based on efforts that took place after the filing of Triumph's applications and thus were not probative on the question of whether Coach's marks were famous prior to Triumph’s filings. Notwithstanding the dilution ruling, however, the court made it a point to state that establishing fame for dilution purposes is not an insurmountable obstacle. In fact, the court was keen to point out that both its and the TTAB’s decisions were based on the record presented and that, with a more comprehensive evidentiary showing, Coach may very well be in a position to show the fame necessary to support a dilution claim.

The court in Coach also addressed the registrability of Triumph's marks. Coach claimed that Triumph's marks were merely descriptive of the products offered by Triumph (and thus not registrable) because the products were essentially intended to be used in 'coaching' students. Therefore, the marks “immediately convey to purchasers the purpose of the materials”. The initial inquiry on this issue was whether Coach even had standing to assert the descriptiveness claim. In an opposition, standing is typically found where the opponent makes a claim that it will be “damaged” by the registration of the mark shown in the published application. While Triumph did not challenge Coach’s claim that it would be damaged on likelihood of confusion and dilution grounds, it argued that Coach had no reasonable basis to argue that it would be damaged by the alleged merely descriptive nature of Triumph's marks. However, where an opponent has made a sufficient showing to satisfy the standing requirement (ie, an appropriate allegation of damage), the opponent is entitled to rely on "any of the grounds set forth in Section 2 of the Lanham Act which negate applicant’s right to its subject registration". As such, the court agreed with the TTAB on this point and rejected Triumph’s lack of standing argument.

Substantively, however, the court took issue with the TTAB’s descriptiveness analysis and Triumph’s resultant right to registration. While a merely descriptive term is prima facie not registrable, a descriptive term can become registrable when the term acquires secondary meaning as a result of the mark owner’s use of the term in commerce. Secondary meaning is established when the mark owner shows that, “in the minds of the public, the primary significance of a product feature or term is to identify the source of the product rather than the product itself”. The secondary meaning determination is typically made by evaluating such things as advertising expenditures, sales success, length and exclusivity of use, unsolicited media coverage, copying and consumer studies.

In remanding the case back to the TTAB, the court found that Triumph’s support for its secondary meaning claim was plagued with evidentiary errors that called into question the TTAB’s ultimate conclusion that secondary meaning had been established. For example, the court questioned the TTAB’s reliance on certain sales success-related testimony submitted by Triumph because the TTAB had previously indicated that the witness providing that testimony lacked adequate personal knowledge of the underlying facts. Most significantly, however, the court disagreed with the TTAB’s decision to discount certain third-party uses of the term 'Coach' because they came after the filing of Triumph's applications. In contrast to the question of fame in the dilution context, the court explained, “acquired distinctiveness and buyer recognition is to be tested in an opposition proceeding as of the date the issue is under consideration. The filing date is not a cut-off date for any evidence developing after that time.”

The decision in Coach is instructive in a number of ways. First, it provides an educational summary of points to consider in analysing likelihood of confusion and dilution issues. Second, it gives a useful primer of opposition standing requirements. Third, it discusses the question of acquired distinctiveness and the proofs necessary to establish it. Finally, and perhaps most importantly for US practitioners involved in opposition proceedings before the TTAB, it emphasises the evidentiary prerequisites required for a party to be in a position to use the types of evidence typically submitted in support of such proceedings.

Timothy J Kelly, Fitzpatrick Cella Harper & Scinto, New York

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