Addressing the standard for fame of a trademark, the US Court of Appeals for the Federal Circuit vacated and remanded a Trademark Trial and Appeal Board (TTAB) decision, finding that the TTAB used an incorrect standard in its analysis of whether a mark has achieved the status of “famous.” Joseph Phelps Vineyards, LLC v. Fairmont Holdings, LLC, Case No. 2016-1089, (Fed. Cir., May 24, 2017) (per curiam) (Newman, J, concurring).
Joseph Phelps Vineyards has been selling its wines bearing the mark INSIGNIA since 1978. In 2012, Fairmont Holdings registered the mark ALEC BRADLEY STAR INSIGNIA for cigars, tobacco, cigar boxes, cigar cutters and cigar tubes. Phelps petitioned for cancellation of Fairmont’s mark. Although the products are different, Phelps argued that the fame of its mark increased the likelihood of confusion. The TTAB disagreed, finding that Phelps’s mark was not famous. Phelps appealed.
The Federal Circuit found that the TTAB’s analysis of “fame” was flawed in that it treated fame as an “all or nothing” factor. The Court pointed out that although fame is “either/or” in a dilution analysis, that is not the case in a likelihood of confusion analysis, which treats the factor along a spectrum from strong to weak. Phelps had provided substantial evidence that its wine is renowned in the wine market and among consumers of fine wine. The record revealed extensive recognition and accolades for the INSIGNIA brand wine by national media outlets and food and wine magazines. In fact, INSIGNIA wine was served at White House dinners on multiple occasions. The Court was perplexed at the TTAB’s finding that INSIGNIA wine had no “fame,” having given no discernable weight to this factor. It remanded the case for the TTAB to apply the proper standard.
Judge Newman separately concurred, noting two additional issues that warranted review on remand. First, she found that the TTAB failed to properly examine Fairmont’s actual use of the mark. She pointed to the dominance of the word INSIGNIA as used on Fairmont’s products. The TTAB had determined that since Fairmont used “standard characters” and was not limited in the presentation of its mark, use of the word in all capital letters was not an issue. Judge Newman disagreed and suggested that the TTAB re-analyze the mark as “viewed from the eyes of a consumer” to determine the commercial impression of the mark.
Second, Judge Newman determined that the TTAB failed to treat the DuPont factor of “relatedness” along a sliding scale. The TTAB had concluded that wine and cigars were not related, but the evidence suggested that the goods are sold in the same channels of trade to the same purchasers. Judge Newman pointed out that relatedness is a broad concept and products may exhibit “relatedness” when they are “complementary products sold in the same channels to the same class of consumer.”
Practice Note: The Federal Circuit adopted a sliding scale rule for “fame” in likelihood of confusion cases. Fame must be assessed based on the totality of the circumstances, which requires considering all the relevant factors on a scale appropriate to their merits.
