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September 15, 2016 Vol. 71 No. 16 Back to Bulletin Main Page

UNITED STATES: TTAB Highlights Importance of Filing Cancelation Petitions on Time

In a precedential decision (June 7, 2016), the U.S. Trademark Trial and Appeal Board (Board) held that when a petitioner files a petition to cancel an existing registration when the registration is less than five years old, the five-year bar in the Lanham Act Section 14 (15 U.S.C. Section 1064) is tolled for the purpose of adding an additional claim against that registration. Ashland Licensing & Intellectual Property LLC v. Sunpoint International Group USA Corp., 119 USPQ2d 1125 (T.T.A.B. 2016) (precedential).

On June 6, 2013, Ashland Licensing, which owns the mark VALVOLINE, filed a petition to cancel Sunpoint International’s trademark registrations for MAXVOLINE, Reg. No. 3450454 and Reg. No. 3454800, registered on June 17, 2008, and June 24, 2008, respectively. Ashland Licensing sought cancelation based on likelihood of confusion and abandonment, just before the marks had reached their five-year registration anniversary. Under Section 14, a petition to cancel filed on or before the five-year anniversary may plead any ground for cancelation; but, a petition filed after the five-year anniversary may only plead the grounds for cancelation appearing under Section 14(3) (i.e., if the mark becomes generic; if it becomes functional; if it is abandoned; or if it was obtained fraudulently). In this case, because Ashland Licensing filed for cancelation within five years of registration, the filing was timely.

A larger question loomed—could Ashland Licensing add a claim after the five-year registration anniversary had passed? Here, Ashland Licensing made a motion to amend its petition to add a nonuse claim against both registrations on April 21, 2015. A nonuse claim is not one of the specific grounds provided under Section 14(3), which meant the Board would need to determine whether or not the Lanham Act allowed for adding claims based on a timely cancelation petition. In answering that question, the Board examined the decision of the United States Court of Customs and Patent Appeals (CCPA) in Williamson-Dickie Mfg. Co. v. Mann Overall Co., 359 F.2d 450, 149 USPQ 518 (CCPA 1966), in which the CCPA held that the filing of an opposition within five years of the issuance of the opposer’s registration tolled Section 14 “for the purpose of a defendant adding a counterclaim.” The Board reasoned by analogy that the present case and Williamson-Dickie presented “a variation on the same theme, such that the same reasoning is applicable.” The Board noted no prior conflicting precedent.

The Board examined whether Ashland Licensing acted in a timely manner. Ashland Licensing presented evidence that it learned of the factual support for its nonuse claim during a June 10, 2014, deposition of Sunpoint International’s president. The Board held that Ashland Licensing had not acted with undue delay because the proceedings, themselves, had been suspended a number of times (“or there was good cause to believe that proceedings would be suspended”) since the initial petition to cancel had been filed.

Finally, the Board reviewed the legal futility of the additional claim. Ashland Licensing based its nonuse claim on the dates Sunpoint International filed its statements of use, instead of the original (or extended) periods allowed for filing the statements, as provided under Trademark Rule 2.88(e), 37 C.F.R. Section 2.88(e). The Board held that the proposed nonuse claim was “legally insufficient at present,” but “not futile.” Ashland Licensing could replead its claim within 15 days of its decision, and if done correctly, the claim could be properly added to its petition.

Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest. Law & Practice updates are published without comment from INTA except where it has taken an official position.

© 2016 International Trademark Association