Prior to commencement of this proceeding, Respondent Unity Clothing amended its registration to delete five clothing items from its identification of goods. After commencement, and without opposition from Petitioner, Respondent deleted a sixth item.
Petitioner Clark's only claim was fraud, i.e., that Respondent "fraudulently alleged actual use of the [registered mark] in commerce on goods when no actual use has been made." Of courses, Unity denied the salient allegations of Clark’s fraud claim.
Under In re Bose Corp., the following four elements must be established to prove fraud:
- applicant/registrant made a false representation to the USPTO;
- the false representation is material to the registrability of the mark;
- applicant/registrant had knowledge of the falsity of the representation; and
- applicant/registrant made the representation with intent to deceive the PTO.
Respondent Unity admitted, on discovery, that it falsely stated that it was using its mark on the eliminated goods when it filed its underlying application and that it knew at that time that it was not using its mark on those goods. Thus, the first and third Bose elements were satisfied. Furthermore, there was no dispute that this was a material representation because the PTO relied upon that statement in issuing the challenged registration. Consequently, the second element was satisfied.
The question, then, was whether Unity had an intent to deceive the PTO when it made the false statement.
Unity asserted that it "acted under a mistaken belief that it was proper to list related goods that were as yet unused together with related goods that were already in use." It pointed to the fact that it deleted the "unused goods" as soon as it learned that inclusion of those goods was improper. Clark had nothing to offer other than Unity's admissions.
The Board found Unity's explanation "plausible in that it mistakenly believed that it could list goods for which it was not using its mark already so long as it was making use of its mark on other goods identified in the application at the time."
We do not have clear and convincing evidence to suggest the false statements were the result of a fraudulent intent rather than Unity's principal, Mr. Hwang, simply misunderstanding the requirement that all, and not just some, identified goods must be used in commerce at the time of filing a use-based application. While the admissions are certainly relevant, applicant has not admitted that its false statement entitled it to a registration that it did not otherwise deserve. Reviewing the record in its entirety, we do not find sufficient evidence demonstrating any deceitful intent on Unity's behalf in this regard.
The Board saw "some probative value in Unity's actions in promptly amending its registration upon learning of its error." It recognized that principals of companies, and even counsel, sometimes overlook or misinterpret averments made in documents submitted to the PTO. "Without more, we do not find a fraudulent intent simply based on mistakes or oversights."
And so the Board dismissed Clark's petition for cancellation.
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TTABlog comment: Is fraud dead? You betcha! Note that it is helpful to amend a registration (or, presumably, correct an application) in a timely manner to eliminate "unused" goods/services.
For a case (not a TTAB case) where fraud was recently found, see Melodrama Publishing LLC v. Santiago, Civil Action No. 12-Civ. 7830 (S.D.N.Y. April 11, 2013). [TTABlogged here].
Text Copyright John L. Welch 2013.
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