by Victoria J. Schwartz (New York)
On July 26, 2021, Natter & Associates’ legal team, comprising Howard Natter and Karin Cao, received a favorable decision from the Trademark Trial and Appeal Board in Gaziantepli Habes Seyidoglu Baklavalari Uluslararasi Nakliyat ve San. Tic. Ltd. Sti. v. Nema Food Distribution Inc., Cancellation No. 92070059. Howard Natter was the attorney of record for Gaziantepli Habes Seyidoglu Baklavalari Uluslararasi Nakliyat ve San. Tic. Ltd. Sti. (“the Petitioner”) in its trademark cancellation proceeding against Nema Food Distribution, Inc. (“the Respondent”). The Board granted the petition to cancel the Respondent’s registration for the mark SEYIDOGLU for Turkish desserts and various food items because it falsely suggested a connection with the Petitioner.
In 2007, the Petitioner, a major manufacturer of Turkish desserts and pastries, entered into an exclusive distribution agreement with the Respondent to distribute its products with the SEYIDOGLU mark in the United States. While doing business together, the Respondent filed a trademark application for the SEYIDOGLU mark in the United States. When the Petitioner terminated its business relationship with the Respondent in 2018 and subsequently used the SEYIDOGLU tulip seal in the United States, the Respondent sent a cease and desist letter, prompting the Petitioner to bring this action.
The Petitioner sought to cancel the Respondent’s registration of the mark on the grounds of (1) false suggestion of a connection and (2) fraud.
The Board accepted the Petitioner’s argument that the Respondent’s use of the SEYIDOGLU mark falsely suggested a connection with the Petitioner. To establish false suggestion, the Petitioner proved the mark was unmistakably associated with a particular personality by meeting all elements of a four-part test:
- the mark is the same as, or a close approximation of, Petitioner’s previously used name or identity;
- the mark would be recognized as such, in that it points uniquely and unmistakably to Petitioner;
- Petitioner is not connected with the activities performed by Respondent under the mark; and
- the fame or reputation of Petitioner is such that, when the mark is used with Respondent’s goods, a connection with Petitioner would be presumed.
Univ. of Notre Dame du Lac v. J.C. Gourmet Food Imps. Co., 703 F.2d 1372, 217 USPQ 505, 509 (Fed. Cir. 1983); In re ADCO Indus. - Techs., L.P., 2020 USPQ2d 53786, *3 (TTAB. 2020); Pierce-Arrow Soc’y v. Spintek Filtration, Inc., 2019 USPQ2d 471774, *4 (TTAB 2019); Schiedmayer Celesta GmbH v. Piano Factory Grp., Inc., 2019 USPQ2d 341894, *6 (TTAB 2019).
The Board held that the Petitioner satisfied all four elements. (1) SEYIDOGLU was the same mark and name the Petitioner had been using publicly on their products, website, invoices, and letterhead. (2) SEYIDOGLU would be recognized as a close approximation of the Petitioner’s name or identity because it pointed uniquely and unmistakably to the Petitioner. The Respondent’s registration included goods such as Turkish delight and baklava, two of the Petitioner’s signature dessert products. The packaging on the Respondent’s goods even included the Petitioner’s founding year, 1952, and the same tulip design bearing the initials of the Petitioner’s founder, pointing uniquely and unmistakably to the Petitioner. (3) As of 2018, the Petitioner was no longer connected to the goods sold by the Respondent. And (4) the fame or reputation of the Petitioner was such that, when the mark was used with the Respondent’s goods, a connection with the Petitioner would be presumed. By the time the Respondent was issued the registration, the Petitioner was known as a leading manufacturer and exporter of Turkish foods through advertisements, commercials, and the media. It had participated in food and confection shows at the Javits Convention Center in New York, and was well-known in Turkey, as well as among the Turkish-American community. The Board pointed out that significant fame and reputation abroad has bearing on consumer awareness in the United States.
Turning to the Petitioner’s fraud claim, to prove fraud in procuring a trademark registration, an applicant must have knowingly made a false material representation of fact in connection with the application to register, with the intent of obtaining a registration to which it was not otherwise entitled. In re Bose Corp., 580 F.3d 1240, 91 USPQ2d 1938, 1939-40 (Fed. Cir. 2009); Torres v. Cantine Torresella S.r.L., 808 F.2d 46, 1 USPQ2d 1483, 1484 (Fed. Cir. 1986); Embarcadero Techs., Inc. v. Delphix Corp., 117 USPQ2d 1518, 1521 (TTAB 2016); Nationstar Mortg. LLC v. Ahmad, 112 USPQ2d 1361, 1365 (TTAB 2014). The Petitioner carries the burden of proving fraud "to the hilt" with clear and convincing evidence. Bose, 91 USPQ2d at 1939 (quoting Smith Int’l, Inc. v. Olin Corp., 209 USPQ 1033, 1044 (TTAB 1981)).
The Board found that the Respondent’s declaration in its underlying application constituted a false material representation of ownership of the SEYIDOGLU mark. A manufacturer, not the distributor, is the presumed owner of the trademark in the absence of an agreement saying otherwise. See Nahshin v. Prod. Source Int’l, LLC, 107 USPQ2 1257, 1263 (TTAB 2013); see also Global Maschinen GmbH Banking Sys., Inc., 227 USPQ 862, 866 (TTAB 1985). In this instance, the Petitioner was the manufacturer, there was no agreement granting trademark rights to the Respondent, and the Respondent did not discuss any of the relevant factors in rebutting the presumption of ownership by the Petitioner. Therefore the Petitioner was the owner of the mark when the Respondent filed its trademark application, and the Respondent was not entitled to obtain the registration.
However, the Board found that the Petitioner was unable to meet its heightened burden of proof to show that the Respondent made false statements with the subjective intent to mislead and deceive the USPTO into issuing the registration. See Smith Int’l v. Olin Corp., 209 USPQ at 1044; see also Bose, 91 USPQ2d at 1941. Proving the Respondent’s subjective intent to deceive requires clear and convincing evidence. Bose, 91 USPQ2d at 1940, 1941 (quoting Meineke Discount Muffler v. Jaynes, 999 F.2d 120, 126 (5th Cir. 1993)). Although Petitioner provided indirect and circumstantial evidence, without more, it could not prove, to the hilt, the Respondent’s subjective intent to deceive.
The Board’s July 26, 2021 decision can be found here.
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