Trademarks are used to identify and distinguish an individual’s or entity’s goods or services from those manufactured or sold by others and to indicate the source of such goods or services. In contrast, and with respect to goods and services, certification marks—which often accompany a brand or house mark—are marks which the owners permit third parties to use “to certify regional or other origin, material, mode of manufacture, quality, accuracy, or other characteristics of such person's goods or services or that the work or labor on the goods or services was performed by members of a union or other organization.” 15 U.S.C. §1127. Despite these differences, courts have long held that certification marks—which federal law exempts from the Lanham Act’s general prohibition on registering “geographically descriptive” marks—are entitled to the same level of protection as trademarks. However, until recently, the Federal Circuit had yet to articulate guidelines for assessing whether a certification mark is famous based on evidence of fame relating to sales and advertising expenditures of third parties’ products bearing both third-party marks and certification marks. The Federal Circuit has now provided such guidance in Bureau National Interprofessionnel du Cognac et al. v. Cologne & Cognac Entertainment.
The Federal Circuit’s decision, which involved the certification mark COGNAC, is significant in that it establishes a new standard for assessing evidence of third-party uses of a certification mark in deciding whether a certification mark is famous.
Cognac is a kind of brandy manufactured in France following certain standards. In the United States, the federal agency responsible for regulating the labeling and advertising of spirits products, the United States Alcohol and Tobacco Tax and Trade Bureau, only permits the use of the term “COGNAC” on spirits products consisting of “[g]rape brandy distilled exclusively in the Cognac region of France, which is entitled to be so designated by the laws and regulations of the French government.” 27 C.F.R. § 5.145(c)(2). The two entities responsible for controlling and protecting the certification mark COGNAC are Bureau National Interprofessionnel du Cognac (BNIC)—a trade association for the Cognac industry which represents the interests of producers of COGNAC brandy located in France’s Cognac region—and Institut National des Appellations d’Origine (INAO)—an administrative agency within the French government tasked with establishing, maintaining and protecting France’s “appellations of origin” system, (i.e., France’s system for designating a product as originating from a particular geographic region in France, and therefore possessing certain methods of manufacture, qualities, characteristics, etc.) (collectively, Opposers).
While the term “COGNAC” is not registered with the United States Patent and Trademark Office (the USPTO), as the Federal Circuit acknowledged, it has long been recognized as a common law certification mark. Nonetheless, in or about March 2019, Cognac & Cologne Entertainment (C&C Entertainment), a hip-hop record label, applied to register the “CCE Mark” for audio and video recordings featuring music and artistic performances, music composition services, production of musical videos and entertainment in the nature of live performances by musical artists, and other related goods and servicesin International Classes 9 and 41 (see footnote for CCE Mark). The USPTO published the CCE Mark for opposition and BNIC and INAO jointly opposed registration of the mark. Opposers asserted that their rights in the COGNAC certification mark were senior to any rights C&C Entertainment might claim to possess in the CCE Mark and that C&C Entertainment’s registration of the mark was likely to result in consumer confusion or deception as to the source of C&C Entertainment’s goods and services, dilution (by both blurring and tarnishment) of the distinctiveness of Opposers’ famous COGNAC certification mark and falsely suggest an association between C&C Entertainment and Opposers.
The Trademark Trial and Appeal Board (the TTAB), in a split decision, dismissed the opposition holding that, based on the evidence submitted, Opposers’ COGNAC mark was distinctive (and entitled to a normal scope of protection), but not famous. In so holding, the TTAB advised that Opposers’ evidence of third-party uses of “COGNAC” in advertisements or on bottles showed that such uses were inconspicuous in nature and that, in any event, it was difficult to assess whether the third parties’ marks (such as HENNESSY) or Opposers’ COGNAC mark drove the relevant sales and advertising figures. According to the TTAB, “the fact that a brand, such as HENNESSY, may be a famous one based on a showing of sales, advertisements, unsolicited media attention, etc., does not necessarily translate to Opposers’ certification mark also being famous” and “the success of a type of product sold under various trademarks does not necessarily mean that the placement of certification mark(s) on those products is equally successful.” Administrative Trademark Judge (ATJ) Wolfson reached a different conclusion in her dissent. She found Opposers’ evidence sufficient to prove fame of the COGNAC mark for purposes of a likelihood of confusion, and indicated that she would sustain Opposers’ likelihood of confusion claim. The TTAB then proceeded to rule that, applying the normal scope of protection to be afforded to Opposers’ COGNAC mark, there was no likelihood of consumer confusion between that mark and the CCE Mark. The TTAB also rejected Opposers’ dilution by blurring claim based upon Opposers’ failure to “plead, argue or prove that their mark became famous prior to any actual or constructive use by [C&C Entertainment]”. Moreover, the TTAB found that Opposers had waived their dilution by tarnishment claim, as Opposers had not addressed this claim in their brief or in the body of their opposition.
On appeal, Opposers argued, among other things, that the TTAB erroneously required Opposers to prove that the COGNAC mark is famous not for its geographic significance, quality, etc., but rather for its “certification status,” and argued that the TTAB did not properly consider Opposers’ evidence (e.g., advertising and sales figures for COGNAC products sold under third parties’ brands, in assessing the fame of the COGNAC certification mark). In response, C&C Entertainment argued, among other things, that, as a certification mark, the COGNAC mark could not be famous as it does not function as a source identifier but to certify geographic origin.
The Federal Circuit agreed with Opposers, holding that a certification mark “need not be famous for all of its indications, and it need not be famous for its certification function.” In so holding, the Federal Circuit noted the TTAB erroneously “seems to have required that COGNAC be famous for its ‘certification status,’ rather than its geographic significance or other indicator(s) (e.g., quality, method of manufacture, etc.).” The Federal Circuit focused on the TTAB’s failure to properly credit Opposers’ substantial evidence as to the extensive use and reputation of the COGNAC mark and clarified that “the fame of a house mark” does not “per se, preclude a finding of fame of a certification mark that appears on the same product. Nor is there a presumption that the fame of a product is the result of the house mark over the certification mark.” Taking a cue from ATJ Wolfson, the Federal Circuit also pointed out that, in a separate case involving the COGNAC certification mark, a different TTAB panel held that “the COGNAC certification mark would fall on the very strong end of the spectrum of fame” in a likelihood of confusion analysis and that the DuPont fame factor heavily favored a likelihood of confusion finding. In assessing the other DuPont factors for the likelihood of confusion claim, the Federal Circuit, taking into account the points raised in its decision, provided the TTAB certain guideposts and things to consider on remand. Additionally, the Federal Circuit held that Opposers sufficiently pled their dilution by blurring claim. In light of the Federal Circuit’s decision to vacate the TTAB’s finding that COGNAC was not famous for purposes of either a likelihood of confusion or dilution, it will be interesting to see how the TTAB’s analysis and ruling on remand turn out.
Why It Matters
Given the Federal Circuit’s conclusion that evidence of sales and advertising relating to use of a certification mark in conjunction with third-party marks can prove fame, owners of certification marks should take care to collect and submit as much evidence as possible in TTAB proceedings to show widespread use of their marks in the market. While COGNAC holds a special significance here, we recommend registering your certification marks with the USPTO. This is important, as U.S. registrations of certification marks afford owners legal rights and benefits such as a legal presumption of ownership, the exclusive right to permit third-party use of the mark nationwide in connection with the goods and services listed in the registrations and the ability to bring an action concerning the registered marks, and not just one based on common law rights, in federal court.
![cologne-and-cognac.png cologne-and-cognac.png](https://www.manatt.com/getmedia/c9557de7-f77a-4686-bac6-3ecb4059f2c1/Cologne-Cognac)
Figure 1: Image of the CCE Mark.