Time Out! Trademark Fails for Lack of Intent to Use

1.28.16

Say you learn that the Trademark Trial and Appeal Board (TTAB) has rejected a likelihood of confusion argument made by a party that opposes your trademark application. Time to pop the champagne, right? You’re in the clear!

Not exactly. Or at least this wasn’t the case in the recent decision of M.Z. Berger & Co., Inc. v. Swatch AG. Here, just such a trademark challenge ultimately succeeded because the TTAB and the U.S. Court of Appeals for the Federal Circuit eventually concluded that the applicant lacked the requisite “bona fide intent” to use the mark in commerce.

Alarming application

M.Z. Berger & Co., Inc., manufactures, imports and sells watches, clocks and personal care products. In 2007, it filed an intent-to-use application, seeking to register the mark “iWatch” for a variety of watches, clocks and related goods.

Swatch AG filed an opposition to the mark on the ground that it was confusingly similar to its mark “Swatch.” It also asserted that Berger lacked a bona fide intent to use the mark in commerce at the time it filed its application.

The TTAB found no likelihood of confusion, but sustained Swatch’s opposition because Berger had failed to demonstrate the necessary intent. Berger appealed.

Clocking the applicant

The Lanham Act, the federal trademark law, doesn’t define “bona fide intent.” After examining legislative history, the appellate court held that an applicant must show objective evidence of intent to use a mark at the time the application is filed. Although the evidentiary bar isn’t high, it said, the circumstances must indicate that the intent to use the mark was “firm” and not merely intent to reserve a right in the mark.

Berger argued that it satisfied the standard for intent by providing some objective evidence in support of its position. But the Federal Circuit disagreed. It explained that all circumstances regarding an applicant’s intent must be considered, including those that would tend to disprove the requisite intent.

In light of the inconsistent testimony offered by Berger employees, and the general lack of documentary support, the court found that substantial evidence supported the TTAB’s conclusion that Berger’s intent at the time of application was to get dibs on the mark — not to use it in commerce.

Providing documentation

If you intend to apply for a trademark, be prepared to provide sufficient documentation of your intent to use the mark at the time of application. If you are unable to clearly demonstrate bona fide intent, you could lose out on the mark.