A recent decision of the Trademark Trial and Appeal Board (the “Board”) highlights what the Board looks for when determining which user of the trademark has priority of use. See Parley, LLC v. Vi-Jon, Inc., Cancellation No. 92055751 (February 27, 2015). One common issue often raised in cancellation proceedings is who is the senior user of the trademark. This recent Board decision reminds trademark owners that use in commerce is a legal term that a trademark owner may not be able to satisfy if sales of the goods were token sales made to personal friends or relatives.
In this case, Vi-Jon Inc. (the “Respondent”) owns a registration for the mark DIP-IT in standard characters for nail polish remover. Parley LLC (the “Petitioner”) claims prior use of and ownership of a pending trademark application for an identical mark for identical goods and other related nail products. Petitioner alleges that Respondent’s use of the mark will cause a likelihood of confusion with Petitioner’s mark. Petitioner further alleges that his trademark application was refused based on a likelihood of confusion with Respondent’s registered mark for DIP-IT. Respondent denied the allegations in the Petition, but admitted that its first use of the trademark was on October 25, 2010. In fact, the Respondent was able to prove that he did continuously use the trademark DIP-IT for nail products since October 25, 2010. The pressing issue in this case was could the Petitioner establish a priority use date earlier than October 25, 2010.
Tuan Nguyen M.D. is one of the founders of the Petitioner. He and his family have been in the nail industry since 1996. During the first week of October 2010, the Petitioner alleged that he started to promote its nail products on its website and later promoted DIP-IT goods at trade shows. However, the receipts produced by the Petitioner in connection with participation in a nail tradeshow indicated that the tradeshow occurred in 2011 and not 2010. Additional receipts produced by Petitioner showed sales of DIP-IT nail products in 2011 and 2012.
Since the Respondent owns a trademark registration it is entitled to a presumption of validity. Petitioner does not own a registration and therefore bears the burden of proving by a preponderance of the evidnece that he has priority due to earlier use. In a likelihood of confusion case, the party that first uses the mark on the relevant goods will receive priority of use. See Cent. Garden & Pet Co. v. Doskocil Mfg. Co., 108 USPQ2d 1134, 1139 (TTAB 2013).
The question is can Petitioner prove he used the mark in commerce earlier than October 25, 2010. The Petitioner can demonstrate a proprietary right from use through a prior trademark use (common law rights), prior use of a trade name, prior use analogous to trademark or service mark use, a prior registration, or other use that may qualify as proprietary use. Any such claim of proprietary rights must be pleaded or implied by the Petitioner so that the Respondent is notified of the type of proprietary right. See Trademark Trial and Appeal Board Manual of Procedure (TBMP) §507.03(b).
Under trademark law a mark is considered to be used in commerce when the trademark is either placed on the product or the product’s container, packaging, label, or on documents associated with the goods or sale and the goods are sold or transported in commerce. See 15 U.S.C. §1127. In the case at bar, the Petitioner bases his case on his testimony that he commenced used of the mark in commerce with the goods prior to October 25, 2010, but failed to submit documentary evidence to sufficiently substantiate this claim. Typical evidence of this nature would be invoices, purchase orders, or sales records along with corroborating testimony of an individual who had knowledge of the preparation and the content.
Oral testimony can be sufficiently probative to satisfy priority of use. However, when it is contains contradictions and inconsistencies as it does here, oral testimony alone will not fulfill the requirement for priority of use. The Petitioner didn’t produce evidence of any sales or transport of DIP-IT products. Nor did Petitioner state that he observed the mark applied to any of the goods. Sales to affiliated individuals or entities cannot be relied upon for use of the mark in commerce. In the end, the Board dismissed the petition. It is critical that trademark owners maintain thorough records of their use of the trademark, sales of the branded goods, and of their marketing, promotional, and advertising materials. Before filing any documents with the USPTO or before attempting to enforce trademark rights, trademark owners should consult with trademark counsel to confirm that their use of the trademark is a bona fide trademark use or use analogous to trademark use. Please feel free to contact our office for a courtesy consultation regarding your trademark matter.