In early August the Federal Circuit issued its opinion in Bureau National Interprofessionnel Du Cognac v. Cologne & Cognac Entertainment, a trademark case that attracted an amicus brief. In this case, the Federal Circuit reviewed a judgment of the Trademark Trial and Appeal Board. As explained by the appellants, “[i]n a two-to-one split decision, the Board held registrable a mark prominently incorporating without permission the certification mark COGNAC, holding that the mark . . . , if used for hip-hop music and production services, was not likely to cause confusion or dilution.” The Federal Circuit vacated and remanded the judgment in an opinion authored by Judge Lourie that was joined by Judges Clevenger and Hughes. This is our opinion summary.
Judge Lourie began by outlining the procedural and factual background of the case:
Opposers filed an opposition to a trademark application for COLOGNE & COGNAC ENTERTAINMENT and corresponding design mark by Cologne & Cognac Entertainment (“Applicant”), a hip-hop record label. The United States Patent and Trademark Office (“PTO”) Trademark Trial and Appeal Board (“the Board”) dismissed the opposition to the challenged mark, holding that the mark, if used for hip-hop music and production services, was not likely to cause confusion under 15 U.S.C. § 1052(d) or dilution under 15 U.S.C. § 1125(c) to the COGNAC certification mark . . . .
Opposers are responsible for controlling and protecting the common law certification mark COGNAC for brandy manufactured in the Cognac region of France according to certain standards. The United States Alcohol and Tobacco Tax and Trade Bureau, the federal agency charged with regulating the labeling and advertising of spirits products in the United States, prohibits use of the term “COGNAC” on spirits products except for “[g]rape brandy distilled exclusively in the Cognac region of France . . . . Although COGNAC is not registered with the PTO, it is undisputed that it is a common law certification mark . . . .
As long as a common law certification mark has been shown to have been in use prior to the date of a junior mark and not abandoned, it is entitled to the same level of protection against likelihood of confusion and dilution as a registered mark . . . Opposers filed an opposition to the registration of Applicant’s mark, claiming priority as well as (1) likelihood of confusion with the COGNAC certification mark . . . and (2) that Applicant’s mark, by creating an association with the COGNAC mark, would be likely to cause dilution . . . . In a split decision, the Board dismissed the opposition to the challenged mark, holding that the mark, if used for hip-hop music and production services, was not likely to cause confusion . . . Regarding dilution . . . the Board ruled that Opposers’ pleading was defective because it did not include a specific allegation that the fame of COGNAC predated Applicant’s constructive use date, and further . . . The majority ruled that, in the alternative, Opposers had not proven the fame element of dilution, relying on its analysis of fame for purposes of likelihood of confusion.”
In his analysis, Judge Lourie addressed two issues. The first issue, he explained, is likelihood of confusion, “a question of law based on underlying factual findings” where “the Board’s legal conclusion” are reviewed “de novo.” He noted the court determines “whether or not a likelihood of confusion exists” by considering various factors, though not all are “relevant or of equal weight in a given case, and any of the factors may control a particular case.”
Judge Lourie noted the court has “consistently held that the fame of a prior mark, when present, is a ‘dominant’ consideration in balancing the factors.” He explained this factor is weighted more heavily “because famous marks are afforded a broad scope of protection.” Related to this factor, he concluded that “[t]he Board should . . . have considered whether or not the mark was famous as an indicator of its geographic origin,” noting the Board “did not do so.” That failure alone, he explained, “is an error necessitating vacatur and remand.” On remand, he continued, the Board must “determine the extent of the fame of COGNAC and thus to what scope of protection it is entitled.”
Judge Lourie next analyzed the “similarity of marks.” He explained the court would “not decide the ultimate issue of whether or not the marks engender a different appearance, sound, or commercial impression such that they are dissimilar” and, instead, “leave the Board to consider that on remand.”
As for the remaining factors, Judge Lourie addressed the “similarity or dissimilarity and nature of the goods or services” and the “similarity or dissimilarity of established, likely-to-continue trade channels.” He raised questions regarding the “Board’s declaration that certain record evidence is not ‘relevant’ or ‘probative’ to those factors.” He declared “it was error for the Board to discount . . . evidence completely; it is undoubtedly relevant to the relatedness of goods, services, and trade channels.” As a result, he urged the Board to “consider them on remand.”
As a result of this analysis, the court “vacate[d] the Board’s holding of no likelihood of confusion and remand[ed] for reconsideration of the issue in light of this opinion.”
Judge Lourie next addressed the second issue raised in the appeal, dilution. He explained how the court reviews a determination whether dilution has been pled sufficiently “de novo, accepting all well-pleaded factual allegations in the complaint as true and construing the pleadings in the light most favorable to the plaintiff.”
Judge Lourie explained that, “under the correct pleading standard,” the dilution claim was sufficiently pleaded. Judge Lourie noted how “[t]he purpose of the pleading is to put the respondent on notice of what the complainant intends to argue.”
As for the Board’s alternative finding “that, had the issue been properly pleaded or tried by implied consent,” the fame element of the dilution claim had not been proven, Judge Lourie noted that “that conclusion rested on the majority’s finding that the mark was not famous in its likelihood of confusion analysis.” But, Judge Lourie highlighted, the court “vacate[d] the Board’s finding that COGNAC is not famous for purposes of likelihood of confusion.” As a result, the court likewise “vacate[d] the Board’s finding that COGNAC is not famous for purposes of dilution” and “remand[ed] for consideration of that issue on the merits.”