Top Trademark Decisions: First Half of 2020

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[July 24, 2020, Leesburg] In the first half of 2020, several significant decisions further shaped the course of trademark law, with rulings from the Supreme Court and circuit courts impacting USPTO proceedings, as described below:

Romag Fasteners v. Fossil (U.S. Supreme Court):

In April, the U.S. Supreme Court clarified what a plaintiff in a trademark infringement suit is required to prove to be granted a defendant’s ill-gotten profits. Romag Fasteners, Inc. and Fossil, Inc. signed an agreement to use Romag’s fasteners in Fossil’s leather goods. Romag later discovered that Chinese factories producing Fossil products were using counterfeit Romag fasteners and sued Fossil for trademark infringement under 15 U.S.C. § 1125(a).

The district court relied on Second Circuit precedent and denied Romag’s request for an award of profits because the jury did not find that Fossil had acted willfully. Other circuits had also required a showing the defendant willfully infringed a plaintiff’s trademark to win a profits remedy.

The Supreme Court, faced with the question of whether that categorical rule could be reconciled with the Lanham Act’s plain language, answered negatively. The high court noted that the statute requires a showing of willfulness as a precondition to a profits award when the plaintiff proceeds under § 1125(c), which creates a cause of action for trademark dilution. However, Romag alleged and proved a violation of § 1125(a), a provision establishing a cause of action for the false or misleading use of trademarks. In cases like this, the court emphasized that “the statutory language has never required a showing of willfulness to win a defendant’s profits.”

USPTO v. (U.S. Supreme Court):

On June 30, in a significant win for potential online trademark owners, the Supreme Court ruled that the addition of “.com” to an otherwise generic term could transform it into a protectable trademark.

A generic name—the name of a class of products or services—is ordinarily ineligible for federal trademark registration and protection. The long battle between these two parties centered on the USPTO’s conclusion that is a generic name for online hotel-reservation services in its rejection of Booking’s request for trademark registration.

The USPTO urged the Supreme Court to adopt a bright-line rule, arguing that a generic term adorned with “.com” should always be unprotectable. However, the justices were left unpersuaded by the USPTO’s exaggerated monopoly concerns and instead adopted a more flexible approach based on consumer perception.

The court held that a term styled “” is a generic name for a class of goods or services only if the term has that meaning to consumers. Here, because “consumers do not in fact perceive the term ‘’” as a generic name for online hotel-reservation services, the company was able to secure a landmark victory that will likely incentivize more online companies to apply for federal trademark protection.

Molson Coors v. Anheuser-Busch (Seventh Circuit):

Early in 2019, after Super Bowl LIII, Anheuser-Busch advertised that Bud Light is made using rice while making fun of Miller Lite and Coors Light for using corn syrup. Molson Coors responded by filing suit under 15 U.S.C. §1125, alleging that Anheuser Bush violated the Lanham Act by implying that a product made from corn syrup also contains corn syrup.

The Seventh Circuit rejected those claims, noting that Molson Coors identifies corn syrup as an ingredient in Miller Lite and Coors Lite. Although Molson Coors insisted that a list of ingredients differs from what the finished products contain, the court said that “common usage equates a product’s ingredients with its constituents” and even “some of Molson Coors’s managers testified that a beer ‘contains’ what’s on the ingredients list.” 

Because Molson Coors chose a word such as “ingredients” with multiple potential meanings, the court ruled that it “brought this problem on itself” and held that it is not false or misleading for a seller to say or imply, of a business rival, something that the rival says about itself.

Related: Trademarks; Trademark Infringement

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Posted in: Intellectual Property - Trademarks

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