On April 20, 2006 the Applicant filed a trademark application for NATIONSTAR pro se with the United States Patent & Trademark Office (“USPTO”). The Applicant filed a use-based application for real estate brokerage; rental of real estate; real estate management services (residential and commercial properties); real estate investment; insurance and mortgage brokerage; and business finance procurement services. Eight days after the Applicant’s filing, Nationstar Mortgage LLC, (“Opposer”) filed two applications with the USPTO for NATIONSTAR MORTGAGE (a word mark and a stylized mark) both for mortgage lending services. Opposer disclaimed the exclusive right to use the word “mortgage”.
The Applicant’s application was cited against the Opposer’s two applications based on the possibility of a likelihood of confusion as to the source of the marks. The Opposer filed a Notice of Opposition with the Trademark Trial and Appeal Board (“Board”) alleging that the Applicant did not use the NATIONSTAR mark for any of the services identified in its application prior to the date of filing with the USPTO. Further the Opposer alleged that Applicant fabricated a specimen and knowingly deceived the USPTO. See Nationstar Mortgage LLC v. Ahmad, Opposition No. 91177036 (Sept. 30, 2014).
Applicant decided to hire counsel after the filing of the Notice of Opposition. Upon advice of counsel, he amended his use-based application to an intent-to-use application. However, this amendment will not assist the Applicant in defending against a fraud claim. The reasoning is that fraud occurs if an applicant knowingly makes false representations of fact with respect to its trademark application with an intent to deceive the USPTO. See In re Bose Corp., 580 F.3d 1240, 1245, 91 USPQ2d 1938, 1941 (Fed. Cir. 2009). In re Bose was a seminal case where the Board raised the burden of proof substantially in fraud claims. Nationstar Mortgage LLC is the first case where the Board has found that an Applicant has committed fraud since 2009. There is a heavy burden attached to proving a fraud claim. One must prove fraud with clear and convincing evidence. This means that if a false statement is made, but there was a reasonable belief that it was true then fraud cannot be found. There has to be a requisite intent to deceive the USPTO.