Confusion around 'compound word/phrase' dichotomy highlighted in PRETZEL CRISPS case

United States of America

Trademark rights in many countries are based solely on first-to-file registration and maintenance of the registration granted by the country. In the United States, trademark rights and their scope of protection are determined throughout the life of the mark. Often the initial determination of scope is made at the time of registration, then at the time of maintenance of the registration and at any time of enforcement of the registration. Subject to rights granted by treaty for limited periods of registration without use, this characteristic is based on the fact that US rights exist at common law only through proper selection, use in commerce, registration, maintenance and ongoing internal and external policing for proper use. 

The validity of a mark may be challenged at any time based on the allegation that the mark has become generic. Despite good-faith efforts to register and maintain a mark, once the relevant public comes to think that a mark is the name of a thing (a noun) and not the indication of source (an adjective) of a product or service, the mark becomes generic. Generic terms cannot be exclusively appropriated and third parties are entitled to use them with legal impunity. 

This was illustrated with respect to the mark PRETZEL CRISPS used on pretzel crackers in the recent inter partes matter of Frito-Lay North America Inc v Princeton Vanguard LLC (TTAB Opposition No 91195552, consolidated with Cancellation No 92053001, February 28 2014). In 2005 defendant Princeton Vanguard LLC obtained a supplemental registration for PRETZEL CRISPS® for its pretzel crackers. Supplemental registrations are not published for opposition and are usually allowed by trademark examiners for descriptive marks found to be capable of acquiring secondary meaning through use and registration. The defendant later filed an application for the same mark as applied to the same goods for registration on the Principal Register based on dates of first use and first use in commerce of October 6 2004. When the application was published for opposition, plaintiff Frito-Lay North America Inc filed an opposition on the ground that:

  1. when used in connection with pretzel crackers, the term 'pretzel crisps' is generic; and
  2. in the alternative, PRETZEL CRISPS is highly descriptive and has not acquired distinctiveness. 

The plaintiff subsequently filed a petition to cancel the defendant’s supplemental registration on the same grounds and the two matters were consolidated at the Trademark Trial and Appeal Board (TTAB).

The defendant denied the salient allegations in the consolidated proceeding at the TTAB. Summary judgment motions were filed by each party, and the parties agreed to proceed to trial based on the evidence presented with these motions, as well as supplemental expert declarations. Both parties filed briefs in support of their positions, and the plaintiff filed a reply brief.

The TTAB said that the evidence of record showed that the plaintiff sells pretzels, crackers and other snack foods, and the defendant conceded that the plaintiff had established its standing to oppose the defendant’s application. Turning next to the issue of genericness, the TTAB outlined the two-part test used to determine whether a designation is generic, namely:

  1. what is the genus of goods at issue?
  2. does the relevant public understand the designation primarily to refer to that genus of goods?

The TTAB noted that the public’s perception is the primary consideration in determining whether a term is generic and here it was the plaintiff’s burden to establish that PRETZEL CRISPS is generic by a preponderance of the evidence. In cases where the proposed mark is a compound term (in other words, a combination of two or more terms in ordinary grammatical construction), genericness may be established with evidence of the meaning of the constituent words. 

Following the 1987 holding in the Federal Circuit’s opinion of In re Gould Paper Corp, the TTAB said that, where “the terms remain as generic in the compound as individually, the compound thus created is itself generic”. However, the TTAB noted from the 1999 and 2001 Federal Circuit’s opinions in the cases of In re American Fertility Soc’y and In re Dial-A-Mattress Operating Corp that, “where the proposed mark is a phrase (such as ‘Society for Reproductive Medicine’), the board ‘cannot simply cite definitions and generic uses of the constituent terms of a mark’; it must conduct an inquiry into ‘the meaning of the disputed phrase as a whole’”. The plaintiff argued that 'pretzel crisps' is a compound term under the Gould standard, while the defendant argued that it is a phrase under the American Fertility case and therefore is broader than the sum of its parts. The Federal Circuit's above “compound word/phrase” dichotomy is confusing in application to this practitioner. In any event, the TTAB concluded that the plaintiff was correct.

The plaintiff's and the defendant's stipulated evidence of record included several declarations with exhibits. The TTAB found the genus of goods at issue are pretzel crackers. The relevant public was the ordinary purchasing public for pretzel crackers. Looking to the “primary significance” of the term 'crisps', what matters is the mark in relation to the identified goods, and the TTAB notes that all possible generic names for a product must reside in the public domain. The plaintiff submitted competitive third-party uses of the term 'crisps' to identify crackers, including packaging uses by Kellogg's, Nabisco, H-E-B, Keebler and Lesley Stowe's, to support its argument that the term 'crisp' has come to be known as one name for a 'cracker', and a 'pretzel crisp' is therefore a 'pretzel cracker'. It further submitted substantial evidence of third-party or media references naming or identifying 'crackers' as 'crisps'. Finally, the plaintiff submitted a survey which the TTAB found was unreliable and given little weight.  

The defendant agreed that, while there are certain foods that may be 'crisps', crackers are not appropriately identified as such. The plaintiff showed the TTAB that the defendant had admitted in its responses to requests for admission that it to referred to its own 'pretzel crackers' as 'crisps' in nutritional information. The defendant argued that it had corrected this labelling error and further noted that no dictionary or encyclopedia describes or defines 'crackers' as 'crisps'. The defendant's own proper survey showed that 55% of respondents identified PRETZEL CRISPS as a brand, whereas 36% thought PRETZEL CRISPS was a common (or generic) name. The defendant finally argued that third-party registrations of marks at the USPTO containing 'crisps' without a disclaimer showed that the term should not be found to be generic.

While considering the entire record, the TTAB gave controlling weight to the dictionary definitions, evidence of use of ‘pretzel crisps’ by  the public, including use by the media and by third parties in the food industry, and evidence of use by the defendant itself. Balancing the evidence and arguments, the TTAB found that, based on the record evidence, PRETZEL CRISPS, as used by defendant, would be understood by the relevant public to refer to 'pretzel crackers'. The commonly understood meaning of the words 'pretzel' and 'crisps' demonstrates that purchasers understand that PRETZEL CRISPS identifies 'pretzel crackers'. Anticipating an appeal, the TTAB stated:

"We note that in finding the term 'pretzel crisps' as a whole to be generic, we have analysed it as a combined term, but were we to analyse it as a phrase, on this record, our conclusion would be the same, as the words strung together as a unified phrase also create a meaning that we find to be understood by the relevant public as generic for 'pretzel crackers'."

The opposition was sustained and cancellation was granted.

Brian Edward Banner, The Banner Firm LLC, Washington DC

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