Trademark Trial and Appeal Board
Patent and Trademark Office (P.T.O.)
*1 FIRST INTERNATIONAL SERVICES CORPORATION
v.
CHUCKLES, INC., DBA SUKESHA
December 11, 1987
Hearing: August 27, 1987
Opposition No 72,787, to application Serial No. 501,386, filed September 27, 1984.
Fish & Richardson for First International Services Corporation.
Wiggin & Nourie and James T. Hosmer for Chuckles, Inc., dba Sukesha.
Before Simms, Krugman and Seeherman
Members
Member
First International Services Corporation has opposed an application filed by Chuckles, Inc., d/b/a Sukesha to register "SUKESHA" and design, as depicted below,
for shampoo, hair conditioner, hair setting lotion, hair spray, permanent waves, hair colors, skin and body lotions, skin moisturizers, skin cleansing cream, skin toners and body shampoo. [FN1] The mark was described in the application as consisting "of the coined word 'SUKESHA' between two grids comprising squares plus an arbitrary design."
As grounds for opposition, opposer has alleged that applicant's mark so resembles opposer's "Zig-Zag" mark, as depicted below,
previously used by opposer in connection with its hair salon franchising services and franchised hair care products, and registered for "shampoos, hair conditioner preparation and scalp massage treatment preparations, [FN2] as to be likely, when applied to applicant's hair care products, to cause confusion or mistake or to deceive. Opposer has also alleged that applicant adopted its mark with full knowledge of opposer's "Zig-Zag" mark and opposer's prior rights in the mark, that applicant did not inform the Trademark Examining Attorney examining its application that shortly after the application was filed, opposer had charged applicant with infringement, and that applicant willfully and erroneously represented to a federal court that the Patent and Trademark Office had decided the question of likelihood of confusion between the parties' marks in applicant's favor, all of which has led opposer to assert that applicant has engaged in inequitable conduct and fraud in connection with its application.
Subsequently, opposer requested and was granted leave to amend the notice of opposition to specify three additional allegations supporting its ground of inequitable conduct and fraud. These allegations were that applicant's president swore to the Patent and Trademark Office that applicant had used its mark on certain goods when he knew it had not, that he swore that the word portion of applicant's mark had no meaning when he knew that it meant or approximated the phrase "beautiful hair" in Indian and that he swore that the mark was used on various display and advertising materials when he knew it had never been used in such a manner.
In its answer, applicant has essentially denied the allegations of opposer, except to admit that Kanu Patel, [FN3] during the performance of his consulting work with J.J. Sak, Inc., observed that this company "used the ZIGZAG on product labels in connection with the name 'Command Performance'," answer, paragraph 7; that "applicant filled containers bearing the name 'Command Performance' and the ZIGZAG mark in the summer and fall of 1984," answer, paragraph 9; and that applicant was charged by opposer with infringement of opposer's "Zig Zag" mark in October 1984.
*2 With respect to the additional allegations in the amended notice of opposition, applicant admitted that at the time the application was filed the mark had not been used on all of the products for which applicant stated it was using the mark, but that applicant intended to use the mark on all the products in the near future, and believed it had to identify all of the products. Applicant also admitted that it had stated in its application that "SUKESHA" "has no known meaning in any language," but that its knowledge at the time the statement was made was that "SUKESHA," pronounced phonetically to a person fluent in an Indian dialect might sound similar but not identical to the word in that dialect for "beautiful hair," and that the written word "SUKESHA" has no known meaning.
With respect to the allegations regarding applicant's statement about the manner in which the mark was used, applicant admitted that it had not used the mark in all of the ways enumerated in the application at the time the application was filed, but said that it intended to use the mark in the near future in each enumerated manner, and thus understood and believed that all such uses had to be specifically identified. Applicant denied that it had engaged in inequitable conduct and fraud in connection with the application.
The record herein consists of the pleadings, the application file; a status and title copy of opposer's pleaded registration, applicant's responses to certain requests for admission and interrogatories posed by opposer both in the instant proceeding and in a proceeding between the parties currently pending in the U.S. District Court for the District of Massachusetts, [FN4] portions of the discovery depositions with exhibits of Kanu Patel, applicant's executive vice president and Charles P. Frank, III, applicant's president, [FN5] and applicant's motion for summary judgment and the supporting affidavit of Charles Frank filed in the District Court proceeding, all relied upon by opposer; and papers from the District Court proceeding, namely the affidavit of Douglas R. Chamberlain in support of applicant's motion for summary judgment, as well as opposer's brief in opposition to such motion and the court's order on the motion, portions of the depositions of Carl Youngman and Dennis Brown (with exhibits) taken in connection with the District Court action, all relied upon by applicant; and testimony (and exhibits) of both parties.
Both parties filed briefs on the case and were represented at an oral hearing.
The record shows that opposer, originally by itself and since at least 1983 through its wholly owned subsidiary, Commperf, Inc., is a franchisor of hair styling salons which operate under the mark "COMMAND PERFORMANCE". Opposer also is affiliated with another company, J.J. Sak, Inc. d/b/a CP Products, which prepares private label hair care products for "COMMAND PERFORMANCE" franchisees. In 1983 opposer decided to create a private label professional quality line of hair care products for exclusive sale in "COMMAND PERFORMANCE" salons and chose the "Zig Zag" mark for this new line. The new products bearing the mark were introduced at opposer's October 1983 annual meeting of franchisees.
*3 Opposer's registration for the "Zig Zag" design is for shampoos, hair conditioner preparations, and scalp massage treatment preparations. While the registration certificate indicates no claim to color, opposer has testified that the "Zig Zag" is color coded to identify the various products, with the mark shown in blue for shampoos, red for conditioners and purple for styling products.
The "Zig Zag" mark is used on all of opposer's hair care products, and on virtually all of opposer's advertising and promotional materials, its internal papers, support material given to franchisees, and documents going to potential franchisees. Opposer's mark "COMMAND PERFORMANCE" also appears on the product containers and, with a few exceptions, on the promotional materials.
Products bearing the "Zig Zag" mark are sold only to "COMMAND PERFORMANCE" franchisees, who in turn sell them at their salons to retail customers. The products can only be purchased at the "COMMAND PERFORMANCE" salons, and are often sold as a result of the recommendation of the hair stylist, based on the individual customer's needs.
Applicant is engaged in the manufacture and sale of hair care products. It does private label bottling for others and also prepares products for sale under the applied-for mark. The latter are marketed to hair care and beauty salons.
Applicant was formed by Charles P. Frank, III and Kanu Patel in February 1984. Mr. Patel is a vice-president, director and stockholder of applicant. Prior to the company's founding, Mr. Patel was hired by J.J. Sak in July 1983 to formulate a line of hair care products which were to be sold under the marks "COMMAND PERFORMANCE" and the "Zig Zag" design, and was a paid consultant to that company for the last half of 1983. As part of his duties, Mr. Patel checked the ingredient listings on the bottles bearing opposer's "Zig Zag" mark, and was a speaker at the October 1983 meeting of opposer's franchisees at which opposer introduced its product line bearing the "Zig Zag" mark. In early 1984 Mr. Patel also helped to correct a problem with one of the products sold under the "Zig-Zag" mark.
In connection with the private label bottling aspect of applicant's business, it filled bottles supplied by J.J. Sak, Inc. with two different hair care products. These bottles were delivered to applicant already labelled with opposer's "Zig Zag" mark. The first order was received by applicant from opposer in June 1984.
Applicant adopted the "SUKESHA" and design trademark for a line of products to be sold to hair care and beauty salons. Mr. Patel was involved in developing the mark, including suggesting the word "SUKESHA" and advising as to colors, although Mr. Frank, applicant's president, decided on the final version of the mark. Applicant varies the colors in the "squiggle" portion of its mark, using, for example, blue for its moisturizing shampoo and purple for its sculpturing lotion.
Applicant has testified that it began using the mark on July 12, 1984 for shampoo and hair setting lotion, and had not expanded its use of the mark beyond those two items as of October 1984.
*4 Applicant sells the goods bearing the applied-for mark only to professional beauty salons and barber salons. As part of its marketing, it sends direct mail solicitations to a mailing list consisting of professional licensed beauty and barber salons. No screening is done of such lists, and opposer's franchisees have received promotional material/solicitations from applicant via this route.
Priority is not an issue in this case since opposer has made of record a registration for its "Zig Zag" mark. King Candy Co. v. Eunice King's Kitchen, Inc., 496 F.2d 1400, 182 USPQ 108 (CCPA 1974). Moreover, applicant has admitted it began using its mark subsequent to the filing date of opposer's application that issued as Registration No. 1,342,900. Thus, the only issues we must consider are 1) whether applicant's mark "SUKESHA" and design, for the goods identified in the application, so resembles opposer's "Zig Zag" mark, for shampoos, hair conditioner preparations, and scalp massage treatment preparations, as to be likely to cause confusion, mistake or to deceive as contemplated by Section 2(d) of the Trademark Act; and 2) whether the statements made by applicant in its application regarding its use of the mark, the significance of "SUKESHA" and the right of other parties to use a similar mark constitute fraud.
With respect to the issue of likelihood of confusion, both parties use their marks on identical goods or on such closely related goods as to be legally identical. Turning to the marks, there are obvious differences between them, in that applicant's mark contains the word "SUKESHA" and a grid in addition to the "squiggle" design. The "squiggle" design, too, is different from opposer's "Zig Zag", although these differences are not as obvious. Applicant argues that when the marks are compared in their entireties, as trademark law dictates they must be, they create different commercial impressions. In particular, applicant claims that the word portion of its mark, "SUKESHA", creates the dominant impression because consumers would refer to its products by this word. Applicant also states that the grid portion of its mark is distinctive, and it has detailed the differences between its "squiggle" and opposer's "Zig Zag".
We cannot accept wholeheartedly applicant's conclusions regarding the differences in the marks. In particular, we view the grid design as non- distinctive and mere background material. While the grid appears in the application drawing in black ink, we note that in actual use on applicant's bottles the grid is depicted in white and tends to fade into the background beige bottle color. Nor do we believe that the specific differences in the "Zig Zag"/"Squiggle" designs in the two marks are sufficient to preclude confusion. While the differences are apparent when the marks are compared side-by-side, such a comparison is not the appropriate test for determining likelihood of confusion. Rather, because purchasers would not normally have the opportunity to analyze the marks on this basis, our focus must be on the recollection of the average purchaser, who normally retains a general rather than a specific impression of trademarks. See, Dassler KG v. Roller Derby Skate Corp., 206 USPQ 255 (TTAB 1980); Sealed Air Corp. v. Scott Paper Co., 190 USPQ 106 (TTAB 1975). Considered in such a way, it is our view that both the "Zig Zag" and "Squiggle" designs would leave purchasers with the same general impression, that of left-to-right upward slanted lines, ending with a right-to-left downward slanting tail.
*5 Applicant's mark also contains the word "SUKESHA" and, as applicant points out, words normally present a dominant commercial impression because products are called for by their "name". However, in the case of hair care products, they may also be taken from a shelf without the purchaser having the need to ask for them by name. Further, the "Squiggle" forms a prominent part of applicant's mark, being shown in a larger size than the word "SUKESHA". In connection with this, we note that applicant's purpose was for the "Squiggle" to stand out, and to this end it is depicted in "exciting," "vibrant" colors. Moreover, applicant color codes the "Squiggle" to identify its various products, using a specific color for a specific product. Thus, the "Squiggle" takes on a more significant role, and purchasers would focus on this portion of the mark. In these circumstances, the presence of the word "SUKESHA" in applicant's mark may actually increase the likelihood of confusion, rather than diminish it, because it may suggest to purchasers that applicant's products are associated with or sponsored by opposer. It has frequently been held that the addition of a trade name or house mark or other such matter to one of two otherwise similar marks will not serve to avoid a likelihood of confusion. See, Envirotech Corp. v. National Service Industries, Inc., 197 USPQ 292 (TTAB 1977).
The record shows that since 1983 when goods bearing opposer's "Zig Zag" mark were introduced, the mark has appeared on all opposer's hair care products and its promotional materials for the products, generally in conjunction with opposer's "COMMAND PERFORMANCE" mark, although occasionally the "Zig Zag" appears alone on promotional material. In the three years between the time hair care products bearing opposer's mark were introduced until September 1986, sales of these products were estimated at approximately $1 million dollars, with the products being used and sold at retail in the 300 salons operated by opposer's franchisees.
Since all opposer's products also carry the "COMMAND PERFORMANCE" mark, and this word appears on most of the promotional material as well, applicant correctly points out that this information alone is not sufficient to establish the strength of opposer's "Zig Zag" mark. However, because opposer, like applicant, color codes the "Zig Zag" to identify specific types of products, it is our view that purchasers would take particular note of the design.
Turning to the goods, applicant argues that no confusion is likely to result from the contemporaneous use of the parties' marks because opposer's products are sold to the public only in opposer's franchised "COMMAND PERFORMANCE" beauty salons, and opposer also controls which third-party brands its franchisees may sell. Because of this, and because opposer has directed its franchisees not to sell applicant's products bearing the "SUKESHA" and design mark until the trademark controversy between the companies is resolved, applicant argues that the parties' goods are isolated from one another in the beauty salon trade and never directly compete.
*6 Applicant also argues that opposer's marketing strategy precludes confusion. Stylists are encouraged to recommend specific products of opposer during the customer's beauty salon session. Opposer also suggests that the stylist emphasize to customers that the products may only be purchased at "COMMAND PERFORMANCE" salons. Because of this individualized approach, and the fact that both parties' goods are higher priced, "non-impulse" items which are sold through professional salons, applicant argues that no confusion would result.
We do not find applicant's arguments to be persuasive. Neither opposer nor applicant, in their respective registration and application, has limited the selling environment for their goods to professional beauty salons. Instead, applicant has sought registration of its mark for some of the identical and substantially identical goods that opposer's registered mark covers. Thus, it is proper to consider the issue of likelihood of confusion in terms of the entire market for those goods. See, Canadian Imperial Bank of Commerce v. Wells Fargo Bank, 811 F.2d 1490, 1 USPQ2d 1813 (Fed.Cir.1987).
Further, the record shows that the current market for both parties' goods are the same, namely professional hair care salons, and that applicant has solicited opposer's franchisees to carry and sell at retail its products under the applied-for mark.
Moreover, the effect of applicant's contention would be to place the burden of attempting to avoid confusion on opposer, the registrant, i.e., opposer would have to ensure that applicant's goods were not sold in its salons, and opposer would have to ensure that its franchisees' stylists made it clear where opposer's products were sold. Such a policy flies in the face of trademark law, a principle of which is that later users have a duty to avoid confusion with existing users, and that doubt as to confusion is resolved against the newcomer.
This leads to another factor that bears upon our determination of likelihood of confusion, namely, the circumstances surrounding applicant's adoption of its mark. One who knowingly adopts a mark similar to the mark of another and for the same or closely related goods does so at his own peril, and any doubt as to the similarity of the marks must be resolved against him. See, The State Historical Society of Wisconsin v. Ringling Bros.-Barnum & Bailey Combined Shows, Inc., 190 USPQ 25 (TTAB 1976). Moreover, where there is evidence of an applicant's intent to adopt a mark that suggests to purchasers a successful mark already in use by another, the Board may, and ought to, take into account that intent when resolving the issue of likelihood of confusion when that issue is not free from doubt. Roger & Gallet S.A. v. Venice Trading Co. Inc., 1 USPQ2d 1829 (TTAB 1987). As previously indicated, applicant's vice-president had direct knowledge of opposer's mark prior to the adoption of applicant's mark, and he directly participated in the selection of applicant's mark. In view of this, we have our doubts that applicant's adoption of the particular "Squiggle" design can be characterized as purely an arbitrary choice. Given the universe of "Squiggle" designs available to applicant, it appears to be more than a coincidence that the one adopted should bear such a similarity to opposer's design. In fact, the record shows that the "Squiggle" design first proposed to applicant was similar to or the same as an Oriental character, and that applicant's president advised the designer to change the design to one with no meaning because he did not want it to look Oriental. The result is that applicant's "Squiggle" design, as modified, has more of a zig-zag effect, and bears a closer resemblance to opposer's design than that originally proposed.
*7 It is also of interest that applicant has depicted its "Squiggle" design in some of the same colors as those used by opposer to denote particular products, e.g. blue for moisturizing shampoo and purple for sculpturing lotion. Applicant has claimed that other parties in the field use abstract designs and use the color blue to denote shampoo. However, the only evidence of this are the statements of applicant's president, while the exhibits of such third-party usage of abstract designs made of record by applicant are from a date subsequent to applicant's adoption of the mark.
Opposer has also introduced testimony tending to show actual confusion. The president of one of opposer's franchisees testified that, upon receiving a marketing mailing from applicant which showed representations of its products, he telephoned opposer, inquiring as to whether there was any direct affiliation or equity interest by opposer in the "SUKESHA" products. Another of opposer's witnesses, whose company is owned by the same individuals who own opposer, and whose company shares distribution facilities with opposer, testified that he noticed a shelf of products bearing applicant's mark in a barber shop, and his initial reaction was that they were opposer's products. It was only after examining the product more closely, including checking where it was manufactured, that he realized it was not opposer's.
Applicant argues that neither of these witnesses was actually confused because the former individual checked with opposer and learned there was no connection between the companies, while the latter, who bought the product to show to opposer, knew at the time of purchase that it was not opposer's product. We find applicant's characterization of this testimony somewhat disingenuous. While the individuals may not have been induced to purchase the products while laboring under a false belief as to their origin, the fact that they were initially confused is certainly relevant. Although we do not base our determination of likelihood of confusion on this evidence, it serves to buttress our conclusion on this issue. If these men, who by virtue of their positions are knowledgeable about opposer and its products, were confused, we think it likely that ordinary purchasers, who do not have such specialized knowledge, are much more likely to be confused.
Taking all the factors, as discussed previously, into consideration, it is our conclusion that applicant's use of its mark on hair care products is likely to cause confusion, mistake or to deceive with respect to opposer's mark for the same goods, and we find that registration should be denied on this ground.
Although this determination is sufficient to sustain the opposition, in the interest of rendering a complete decision, we turn to the issue of fraud pleaded by opposer.
Our analysis of opposer's allegations must be governed by the principles of what constitute fraud, as set out in prior case law.
Fraud implies some intentional deceitful practice or act designed to obtain something to which the person practicing such deceit would not otherwise be entitled. Specifically, it involves a willful withholding from the Patent and Trademark Office by an applicant or registrant of material information or fact which, if disclosed to the Office, would have resulted in the disallowance of the registration sought or to be maintained. Intent to deceive must be "willful". If it can be shown that the statement was a "false misrepresentation" occasioned by an "honest" misunderstanding, inadvertence, negligent omission or the like rather than one made with a willful intent to deceive, fraud will not be found. Fraud, moreover, will not lie if it can be proven that the statement, though false, was made with a reasonable and honest belief that it was true or that the false statement is not material to the issuance or maintenance of the registration. It thus appears that the very nature of the charge of fraud requires that it be proven "to the hilt" with clear and convincing evidence. There is no room for speculation, inference or surmise and, obviously, any doubt must be resolved against the charging party.
*8 Smith International, Inc. v. Olin Corp., 209 USPQ 1033, 1043-44 (TTAB 1981), citations omitted.
With respect to opposer's allegation that applicant willfully and erroneously swore to the Patent and Trademark Office that "SUKESHA" had no meaning, the record contains many conflicting statements from applicant as to whether this term has a meaning. At several points in their discovery depositions, both applicant's president and vice-president said that "SUKESHA" means "beautiful hair" and a form letter applicant sent to beauty salons makes the same statement.
Subsequently, and after it was pointed out that the application stated that "SUKESHA" had no meaning, Mr. Patel, applicant's vice-president, "clarified" his statements. In his testimony deposition, Mr. Patel explained that, when providing information for the preparation of the trademark application, he stated that the "trademark has no meaning in any language" because the trademark consisted of the grid and symbol as well as the word, and taken together the entire mark did not have a meaning. He added that there is an Indian word meaning "beautiful hair" which he would transliterate as "sukesh", but that he and Mr. Frank changed this word to "SUKESHA" because it sounded better for marketing purposes. Mr. Patel was then asked:
Well, if you wrote the word "SUKESHA" out on a piece of paper and showed it to an Indian who was familiar with the word "SUKESHA" as meaning beautiful hair, would he be able to read that word?
To which he responded:
No, because most of the Indians do not even speak English. You know, 80% of the Indians are illiterate, so it would be very difficult for any Indian to even know what it's (sic) written unless when you're writing in the Indian language.
Mr. Frank had said at four different points in his discovery deposition that "SUKESHA" meant beautiful hair, and that at the time he signed the trademark application he understood "SUKESHA" to mean beautiful hair in Indian. In his testimony deposition, however, he elaborated on this statement, saying that "it was a similarity, a commendation (sic), that it related to 'beautiful hair'," and, like Mr. Patel, he understood the phrase "trademark has no meaning in any language" to refer to the entire mark, including the design.
We find the testimony of applicant's two officers to be less than credible. It is obvious that a transliterated word can still have a meaning even if the native speaker cannot read the alphabet in which the transliteration appears. It is also obvious that the fact that a mark may have elements in addition to the foreign word does not remove the need to advise the Office as to the meaning of that word. By relying on hair-splitting justifications, it appears that applicant has deliberately tried to mislead the Patent and Trademark Office. Moreover, whatever hair-splitting Mr. Frank may have attempted to engage in, the statement in the application he signed said "the word 'SUKESHA' included in the mark has no known meaning in any language."
*9 However, while at the time he signed the application Mr. Frank may have intended to make a false statement as to the meaning of "SUKESHA", we cannot find that he committed fraud. One of the elements necessary to a finding of fraud is that the statement made is false. On the record before us, we cannot determine whether "SUKESHA" is a transliteration of an Indian word meaning beautiful hair or is merely derived from a word having that meaning. Therefore, we cannot conclude that the statement in the application is actually false. Since fraud must be proven "to the hilt", we must resolve our doubts in favor of applicant.
Opposer has also alleged that applicant engaged in inequitable conduct and fraud by failing to inform the Examining Attorney that opposer had brought suit in federal District Court charging applicant with infringement, and by misrepresenting statements of the Patent and Trademark Office to the court. Neither of these allegations could result in a finding of fraud on the Patent and Trademark Office. While the Patent and Trademark Office prefers that applicants advise the Examining Attorney of any court action involving marks in pending applications, neither the Statute nor Rules requires them to do so. Thus, applicant's silence on this matter is not actionable. Nor are any alleged false representations made to a court regarding the application relevant to a determination of fraud on the Office since, as noted previously, fraud will not lie if the false statement is not material to the issuance of the registration.
Opposer has also alleged fraud due to applicant's failure to inform the Examining Attorney of opposer's mark, about which applicant is claimed to have had prior knowledge. While we have determined in this opinion that, in the totality of circumstances, confusion is likely, we recognize that there is an arguable difference between applicant's and opposer's marks. Accordingly, we do not think it was unreasonable for applicant to believe that the contemporaneous use of the marks by the parties was not likely to cause confusion, and therefore no fraudulent intent can be inferred from applicant's averment to this effect in the application. See, SCOA Industries Inc. v. Kennedy & Cohen Inc., 188 USPQ 411 (TTAB 1975).
With respect to opposer's allegations regarding applicant's manner of use of the mark, Mr. Frank admitted that the mark had not, at the time he signed the application, and still has not been used in many of the ways enumerated in the application, e.g. window decals, product displays. However, he testified that he thought he was to furnish a list of all ways in which he intended the mark to be used. Buttressing this impression is the letter from applicant's attorney which listed the information needed to prepare the application, and which contained the statement, "A concise and complete description of the manner in which the trademark is to be used in identifying the goods with which it is associated...." Emphasis added. Moreover, false statements in the affixation clause regarding additional methods of use normally would not constitute fraud because such statements of additional uses are not material to the issuance of the registration. The primary purpose of the affixation clause is to indicate the manner of use illustrated by the specimens, see TMEP § 808.09, but what is material is that the specimens submitted show valid trademark use and that they were in use at the time the application was filed. [FN6]
*10 Turning to the statement regarding the goods on which the mark was used, applicant's president has admitted that at the time he signed the application the mark had not been used on most of the goods identified in the application, but had been used only on shampoo and hair setting lotion. In June 1985 Mr. Frank signed and submitted an amended application in response to the Examining Attorney's first Office action, and in discovery he admitted that the mark again was not used on all the goods identified in the amended application, but was used only on shampoo, hair conditioner, hair setting lotion and permanent waves. Mr. Frank again testified that he thought he was to furnish a list of all products the mark would be used for, and that he understood the language in the application "has adopted and is using" as meaning using the mark shown in the drawing "and that I had it on products and I intended to use it on all future products...."
We find that applicant committed fraud in its statement regarding the use of the mark on goods for which it only intended to use the mark. There is no question that this statement was material to the approval of the application by the Examining Attorney. As for whether opposer has shown the requisite element of intent or knowing falsity, we recognize that it is difficult, if not impossible, to prove what occurs in a person's mind, and that intent must often be inferred from the circumstances and related statement made by that person. Otherwise, all claims of fraud could easily be defeated by the simple statement, "I had no intent to do so." The analysis must be whether the person knew or should have known of the falsity of the statement. See Torres v. Cantine Torresella S.r.l., 808 F.2d 46, 1 USPQ2d 1483 (Fed.Cir.1986).
In this case, given the inconsistencies and general lack of credibility which we have found in both Mr. Frank's and Mr. Patel's testimony, it is our view that Mr. Frank knew or should have known of the falsity in listing goods on which the mark had not been used. The language in the application that the "applicant has adopted and is using the mark shown" is clear and unambiguous and was central to the application. The errors in this statement cannot be characterized as mere carelessness or misunderstanding to be winked at as of no importance. See, Duffy-Mott Co. Inc. v. Cumberland Packing Co., 424 F.2d 1095, 165 USPQ 422 (CCPA 1970).
Mr. Frank admitted during cross-examination that he did not look at the language in the application, but relied on the fact that because his attorney prepared it he "thought it would be right." We consider Mr. Frank's comments to evidence the same type of cavalier attitude toward statements in affidavits that the Court of Customs and Patent Appeals has said should be deterred through sanctions, see Duffy-Mott Co., Inc. v. Cumberland Packing Co., supra, [FN7] and for the same reasons we believe the opposition should be sustained on the grounds of fraud.
*11 Decision: The opposition is sustained on the grounds of likelihood of confusion and of fraud.
R.L. Simms
G.D. Krugman
E.J. Seeherman
Members, Trademark Trial and Appeal Board
FN1. Application Serial No. 501,386, filed September 27, 1984, claiming first use and first use in commerce on July 12, 1984.
FN2. Registration No. 1,341,900, issued June 18, 1985 from an application filed April 12, 1984 and claiming use in commerce on November 10, 1983.
FN3. The notice of opposition identifies Kanu Patel as a principal in applicant, although the effect of applicant's language in its answer is to deny this allegation.
FN4. First International Services Corp. and J.J. Sak, Inc. v. C.I. Enterprises, Inc. (f/k/a Chuckles, Inc. and d/b/a Chuckles, Inc.), Charles Frank and Kanu Patel, Civ. Action No. 85-2729-MA (D.Mass.). The Court has stayed proceedings in that case in order to allow the "Trademark Office" to consider the matter. Pursuant to Rule 2.122(f) the parties stipulated to allow papers from the District Court action in evidence so long as they were identified in a Notice of Reliance.
FN5. Applicant has attempted to rely on the entire transcripts, with certain exhibits, of these same depositions. Ordinarily, the discovery deposition of an officer of a party may be offered in evidence only by an adverse party. See: Trademark Rule 2.120(j). Certain exceptions to this general rule are specified in Trademark Rule 2.120(j)(2) and (4). The latter subsection provides that if only part of a discovery deposition is submitted and made part of the record by a party, an adverse party may introduce under a notice of reliance any other part of the deposition which should in fairness be considered so as to make not misleading what was offered by the submitting party. However, the adverse party may introduce only that additional material which is relevant. In this case, applicant has not identified the specific parts of the depositions which it considers relevant, and opposer has not treated the entire depositions as of record. Accordingly, the entire discovery depositions will not be considered part of the record pursuant to Rule 2.120(j)(4) and the Board's consideration of the deposition will be limited to those portions identified by opposer in its notice of reliance.
FN6. The specimens first submitted by applicant were not accepted by the Examining Attorney because they were printer's proofs. She required applicant to submit substitute specimens, and required applicant to verify that the substitute specimens were in use in commerce at least as early as the filing date of the application. On June 25, 1985 Charles Frank signed an amended application in which he stated "that the substitute specimens submitted with this amended application were in use in interstate commerce on July 12, 1984, prior to the filing date of the original application for registration, September 27, 1984...." However, during cross-examination in his testimony deposition, Mr. Frank admitted that the same brochure which was submitted as a substitute specimen had not been produced until 1985.
Accordingly, if applicant ultimately prevails in this case, we recommend, pursuant to Trademark Rule 2.131, that the Examining Attorney re-examine the application with respect to this issue.
FN7. Compare: Rogers Corp. v. Fields Plastics & Chemicals, Inc., 176 USPQ 280 (TTAB 1972) where the identification of goods was for "plastic material for general industrial uses, i.e.--followed by a list of uses, and it was found that the plastic material had not been used in all the ways listed. Since the applicant was attempting to indicate the general utility of its goods and no willful attempt to mislead the Office was found, and because the application would have been allowable without the recitation of additional possible uses of the material, no fraud on the Office was found. Compare also, Alcan Aluminum Corp. v. Alcar Metals Inc., 200 USPQ 742 (TTAB 1978), where an intent to deceive was not clear from the record because applicant had told its attorney to remove items from the identification that it had not sold, and the particular item on which the applicant had not used the mark was included in the identification because the applicant had it in stock and its president-owner indicated it might sell these goods if there was a market for them.