Geographic misdescriptiveness standard clarified in MOSKOVSKAYA Case

United States of America
In In re Spirits International NV (Case 2008-1369, April 29 2009), the US Court of Appeals for the Federal Circuit has vacated a decision of the Trademark Trial and Appeal Board (TTAB) in which the latter had found the mark MOSKOVSKAYA to be primarily geographically deceptively misdescriptive of vodka. 
Spirits International NV filed an intent-to-use application for the registration of the mark MOSKOVSKAYA for vodka. The examining attorney translated the mark from Russian to English as “of or from Moscow” and preliminarily refused the application based on the conclusion that the mark would be primarily geographically deceptively misdescriptive because Spirits' vodka does not originate from Moscow. The refusal was based on the conclusion that:
  • Moscow was a generally known geographic location;
  • the public would likely believe that Spirits' goods were from Moscow; and
  • considering the high regard that vodka drinkers have for Russian vodka, this belief would likely be material to the purchasing decision of consumers. 
Spirits was unable to overcome the examining attorney’s objections, even after submission of supporting survey results showing that:
  • a very low percentage of the people surveyed believed that the product was connected to Moscow; and
  • none of those surveyed said that they would be less likely to purchase the product if they discovered that it originated from somewhere other than Moscow (ie, the misdescription was not material to those surveyed because it would not impact their purchasing decision). 
Upon review, the TTAB affirmed the examiner’s refusal, disregarding the survey results primarily because Russian speakers were not surveyed. For purposes of evaluating materiality, the TTAB defined the relevant consumers as Russian speakers and held that an “appreciable number” of the 706,000 Russian speakers in the United States (per judicial notice of 2000 US census data) would be deceived.  
Spirits appealed, arguing that the TTAB had improperly applied the materiality standard by considering only whether Russian speakers, instead of a substantial portion of all relevant consumers, would be deceived. The court agreed with Spirits, articulating the proper standard and remanding the case to the TTAB for further analysis. 
The court began its discussion by affirming that the application of the doctrine of foreign equivalents, translating MOSKOVSKAYA to “of or from Moscow,” was proper in this case. The court explained that the analysis then turns to an assessment of whether the impact of the translated mark is material under 15 USC §1052(e)(3), which prohibits the registration of marks deemed primarily geographically deceptively misdescriptive in the context of the applicant’s goods and/or services. The court then honed in on the issue of the present case - the scope of the materiality requirement under §1052(e)(3). 
The court, acknowledging that prior case law had not addressed the question of “whether the materiality test [...] embodies a requirement that a significant portion of relevant consumers be deceived”, held that it does. In particular, the court held that the provision incorporates a requirement that a “substantial portion of the relevant consumers”, not “any absolute number or particular segment of the relevant consumers (eg, foreign-language speakers)”, would be likely to be deceived. To substantiate its interpretation of §1052(e)(3)’s inherent materiality requirement, the court drew a comparison with the legislative development of and case law for the provision's predecessors, namely §1052(a) (prohibiting registration of deceptive marks), §1125(a) (false advertising provision) and the common law principles that these provisions were intended to codify, all of which requiring a likelihood that a statistically significant or substantial portion of the relevant consuming public would be deceived. 
The court then defined the relevant public as the “entire US public interested in purchasing the product or service”. Albeit inapplicable to the case at issue, the court acknowledged the possibility that cases may occur where use of non-English marks demonstrates that the relevant goods or services are directed to those competent in the non-English language, such that it would be appropriate to consider materiality from the perspective of that specific population of relevant consumers (citing the example of a mark in Polish for canned ham that is marketed to the Polish community).
In focusing on the present case, the court noted that to find materiality:
there would have to be some indication that a substantial portion of the relevant consumers would be materially influenced in the decision to purchase the product or service by the geographic meaning of the mark.” 

The court explained that it was vacating the decision because the TTAB had failed to analyze properly whether the Russian-speaking population constituted a substantial portion of the relevant consuming public for vodka products in the United States. The court noted that a mere 706,000 persons – or 0.25% of the entire US population – would not comprise a substantial portion of the relevant public. However, the court acknowledged that the misdescription could still be found to be material if evidence showed that Russian speakers constitute a significant percentage of vodka consumers or that non-Russian speakers would interpret the mark as an indication that the product originated from Moscow, and that this understanding would impact their purchasing decisions. 

The ultimate outcome of this particular case is still unclear, but the decision is significant in that it articulates more clearly the standard for evaluating the materiality prong in these types of cases.

The decision is important generally to anyone that is seeking registration or plans to seek registration of a trademark in the United States that is arguably misdescriptive. It will be particularly relevant in the context of trademarks comprised of arguably descriptive/misdescriptive terms in a non-English language.

Spirits was also recently involved in proceedings before the TTAB with regard to its RUSSKAYA mark (for further details please see "Spirits International loses US rights to RUSSKAYA mark").
Anita Polott and Natalie Ward, Morgan Lewis, Washington DC

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