10 Jul 2017 in Newsletter
Fame, Wine, and Cigars: The Finer Points of the DuPont Factors
By: A. Rusty Rogers
In a case involving a petition for cancellation of a cigar trademark on the basis of likelihood of confusion with a celebrated wine, the Federal Circuit reminds the Trademark Trial and Appeal Board (TTAB) that the fame prong of the multifactor DuPont balancing test requires considering all evidence when presented.
Trademarks provide protection for holders where there is a “likelihood of confusion” between competing marks in the minds of the consuming public. Likelihood of confusion focuses on whether a hypothetical member of the public would mistakenly believe that two separately marked products were of the same origin. At the Federal Circuit, likelihood of confusion between trademarks is weighed using a multifactor balancing test set out in In re E.I. du Pont de Nemours & Co., 476 F.2d 1357 (CCPA 1973). The “DuPont Factors” consider: (1) the similarity of the marks in appearance, sound, connotation, and commercial impression; (2) the similarity of the nature of the goods (relatedness); (3) the similarity of the trade channels; (4) the conditions in which the products are purchased; (5) the fame of the prior mark; (6) the nature of similar marks on similar goods; (7) the presence of actual confusion; (8) the length of time without actual confusion; (9) variety of goods on which a mark is used; (10) the market interface between the marks being disputed; (11) the extent to which a trademark holder has the right to exclude others from using the mark; (12) the extent of potential confusion; and (13) any other relevant facts.
In Joseph Phelps Vineyards, LLC v. Fairmont Holdings, LLC, (Fed. Cir. May 24, 2017), the Federal Circuit reversed and remanded a petition for cancellation dismissed by the TTAB on the grounds that the board improperly applied the fifth factor in the DuPont balancing test. The case centers around the trademark INSIGNIA, registered to Joseph Phelps Vineyards (Vineyards), and used during the sale of wines since 1978. In 2012, Fairmont Holdings (Fairmont), LLC, received federal registration for the mark ALEC BRADLEY STAR INSIGNIA for cigars and cigar products. Asserting that the labeling of the cigars lead to a likelihood of confusion that the cigars shared a common source with the producers of INSIGNIA wine, Vineyards petitioned the TTAB to cancel Fairmont’s mark, relying in part on the premise that INSIGNIA was a famous mark.
The TTAB denied Vineyards’ petition, stating that the success of INSIGNIA in the marketplace was not persuasive that the mark was indeed famous, and disregarded the evidence offered regarding the popularity of the wine. On appeal, the Federal Circuit noted that, unlike the test for dilution of a famous mark that provides additional remedies under the Lanham Act, the consideration of the fame factor was not a yes or no question, but varied along a spectrum from strong to weak. The Federal Circuit then reversed and remanded the case back to the TTAB to consider the evidence presented under the totality of the circumstances in relation to the other DuPont factors. Here, Vineyards had provided evidence that INSIGNIA wine is renowned in the wine market and among consumers of fine wine, including being selected as Wine of the Year in 2005 and 1997 in trade publications, in addition to being served at the White House on several occasions.
Judge Newman also authored a concurring opinion in which she noted two additional issues with the TTAB’s DuPont analysis. First, Judge Newman pointed to the fact that the TTAB should have examined the actual use of the ALEC BRADLEY STAR INSIGNIA mark. Particularly, she noted that the labeling of the cigars was distinctive in that it separated the ALEC BRADLEY name element from STAR INSIGNIA and that the font for STAR was reduced with respect to INSIGNIA, creating a distinctive highlighting of INSIGNIA. She commented further that the fact that the trademark was directed to a standard character registration does not prevent a court from measuring likelihood of confusion with respect to the use of the mark in commerce, because the test is viewed “through the eyes of the consumer.”
Next, Judge Newman focused on the TTAB’s failure to consider the relatedness of Vineyards’ and Fairmont’s marks. Even if the goods in contention are not identical, confusion of the source of origin is still possible where the consuming public finds the products are sufficiently related. For example, confusion may arise where products are complementary, sold in the same channels of trade, and to the same classes of consumers. Of particular relevance, Judge Newman found that, while the TTAB disregarded the relatedness prong because the products differed in composition and method of manufacture, previous case law found relatedness between marks on cigars and alcoholic beverages, as the products are often consumed at the same time, move in the same channels of trade, and are sold to the same consumers.
From a practitioner perspective, trademark holders petitioning for cancellation on likelihood of confusion grounds should remind the TTAB of their duty to consider all the DuPont factors, specifically highlighting those that support the client’s position. This can be particularly effective where a trademark holder can point to glowing responses in trade publications and public exhibitions relating to the product. In addition, practitioners should be aware of potential issues that can arise with labeling practices that may configure an otherwise legitimate character mark with spacing or highlighting that may lead customers to confuse a client’s mark with another.