Lack of Evidence of Intent to Use Dooms an "ITU" Trademark Application

01 November 2013 Publication
Author(s): Andrew Baum

Legal News: Trademark, Copyright & Advertising Counseling

The Trademark Trial and Appeal Board (TTAB) recently granted summary judgment sustaining an opposition against an application based on intent-to-use (“ITU”) on the sole ground that the applicant had no tangible proof of any genuine intent to use the mark in commerce at the time he filed his application. The decision is a powerful reminder that those filing ITU applications should retain in their files documentary evidence of plans to actually use the mark. It also highlights a potential avenue of attack by those who oppose ITU applications.

In PRL USA Holdings, Inc. v. Young, (Opposition No. 91206846, 10/16/13), opposer was the owner of the well-known trademarks POLO, RALPH LAUREN POLO and a figure of a polo player. Applicant filed an ITU application to register its mark for “shirts.” To view the mark in question and the TTAB decision, please click here.

In response to opposer’s discovery requests, applicant produced no documents regarding any agreements, proposals or negotiations to sell and/or license any products under the mark or to manufacture any goods under the mark. In his interrogatory responses, the applicant did not identify any products to be sold under the mark or any market research done in connection with the mark. In all cases, the applicant simply answered that he was in an “intent to use status” and had not done “any business planning yet.”

The Lanham Act allows applicants to file an application based on a “bona fide intent to use.” If the applicant ultimately uses the mark in commerce and obtains a registration, the application filing date becomes the “constructive first use date.” This has the effect of protecting the trademark owner’s investment in the mark against an interloper who uses a conflicting mark while the application is pending. The statue makes clear, however, that the application must reflect an intention to use the mark “in the ordinary course of trade, …and not…merely to reserve a right in a mark.” Lanham Act Section 45, 15 U.S.C. §1127.

The TTAB acknowledged that the factual question of intent is normally unsuited to disposition by summary judgment. However, the TTAB rule is that failure to produce documentary evidence of an intent to use as of the filing date establishes a prima facie case of no bona fide intent. Saul Zaentz Co. v. Bumb, 95 USPQ2d 1723, 1727 (TTAB 2010). If an applicant fails to rebut the prima facie case with some evidence of bona fide intent, summary judgment is warranted. Honda Motor Co. v. Winkelmann, 90 USPQ2d 1660 (TTAB 2009).

On this record, the TTAB had little trouble finding a lack of bona fide intent to use. Not only did the applicant have no evidence concerning the specific mark at issue; he also failed to show any evidence that he had any business of any kind. “The Board has ‘repeatedly found a lack of bona fide intent to use a mark by individuals who lack the demonstrated capacity to produce the goods identified in the application’” (quoting Swatch AG v. M.Z. Berger & Co., ___USPQ2d___, (TTAB, Opposition No. 91187092, 9/30/2013). Given the individual applicant’s utter lack of business plans, or business of any kind, the TTAB held that the applicant had been simply trying to “reserve rights in a mark” without a bona fide intent to use.

Given that the applicant was an individual with no apparent business experience, this was an easy case. But the principles underlying this decision can be applied to any applicant, even a sophisticated company with a regular, ongoing business. It is not uncommon for businesses to file ITU applications on little more than a vague idea or a whim. It seems clear, however, that a merely subjective intent to possibly use the mark someday may not be sufficient to survive an opposition. In order to avoid a prima facie determination of lack of intent, the applicant should always preserve some documentary evidence of an intent to actually use the mark on the goods set forth in the application.

Those who oppose ITU applications should always be mindful of this line of attack. An opposer’s discovery demands should always seek information and documents concerning the applicant’s intent to use at the time the application was filed. If the applicant fails to produce anything tangible, the opposer can and should amend its pleadings, prior to the testimony period, to add lack of bona fide intent to use as an independent ground for opposition. This can be a winning issue even if there is no success on the merits of the opposition.

A copy of the TTAB decision may be found here.

Legal News Alert is part of our ongoing commitment to providing up-to-the-minute information about pressing concerns or industry issues affecting our clients and our colleagues. If you have any questions about this update or would like to discuss this topic further, please contact your Foley attorney or the following:

Andrew Baum
New York, New York


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