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TTAB Finds Settlement Agreement Persuasive in Concurrent Use Proceeding
Practical Law Legal Update 4-516-9039 (Approx. 3 pages)
TTAB Finds Settlement Agreement Persuasive in Concurrent Use Proceeding
by PLC Intellectual Property & Technology
| Published on 16 Dec 2011 • USA (National/Federal) |
In Holmes Oil Co. v. Myers Cruizers of Mena, Inc., the TTAB discussed its standard for whether it will implement a consent agreement between two parties with similar trademarks.
Key Litigated Issues
Holmes Oil Co. v. Myers Cruizers of Mena, Inc. was a concurrent use proceeding based on Holmes Oil's concurrent use application to register its CRUIZERS trademark. In a concurrent use proceeding, the TTAB determines whether:
- A party is entitled to registration of its mark, typically with a geographic restriction.
- Two or more parties' marks can coexist in the marketplace without a likelihood of consumer confusion.
The TTAB's decision in this case was influenced by the weight it gave to the parties' settlement agreement.
Background
The Holmes Oil concurrent use proceeding arose from Myers' opposition of Holmes Oil's application to register its CRUIZERS mark. In settlement, the parties moved to dismiss the opposition in favor of a concurrent use proceeding. Holmes Oil filed a concurrent use application for the CRUIZERS mark in which it:
- Identified as its area of use the US except for the state of Arkansas.
- Cited Myers' registration for the mark MYERS CRUIZZERS DRIVE-IN for restaurant services as an exception to Holmes Oil's otherwise exclusive right.
Myers then filed a motion to implement the parties' settlement agreement, which provided for Holmes Oil to obtain a territorially restricted registration, while allowing Myers' registration to remain unrestricted. The TTAB decided the case as a concurrent use proceeding, but noted that because the parties' agreement allowed for overlapping territories it had the nature of a consent agreement.
Outcome
The TTAB approved Holmes Oil's application, allowing Holmes Oil to register its mark in the US with the exception of Arkansas and allowing Myers' registration to remain unrestricted. The board found the parties' consent agreement and other statements to be sufficient evidence that confusion is unlikely, and to support Holmes Oil's right to register its mark.
Practical Implications
The opinion provides substantial guidance for companies entering into agreements that are to be submitted to the USPTO in support of trademark registrations. Specifically, the TTAB explains that for a consent agreement to weigh heavily in favor of a finding that confusion is not likely it should include both:
- Information demonstrating the parties' business-driven conclusion that there is no likelihood of confusion.
- Provisions to avoid any potential confusion.
Further, the TTAB identifies as factors affecting the persuasiveness of a consent agreement:
- The parties' reasons for concluding confusion is unlikely (for example, differences in goods or channels of trade and the level of purchaser sophistication).
- The amount of support for each conclusion either by facts of record or undertakings in the parties' agreement.
- The circumstances surrounding the agreement's creation.
The TTAB specifically identified as information that may support a finding that confusion is unlikely a statement of the steps the parties would take if actual confusion arises.
Parties seeking approval of registrations through coexistence, concurrent use and consent agreements should ensure they provide the TTAB with the types of information discussed in this case. For a model trademark coexistence agreement, see Standard Document, Trademark Coexistence Agreement.