Mark My Words, This Is a Heavy Weight to Carry: the Eleventh Circuit Court Sets the Standard Weight Given to a Presumption of Validity of a Registered Mark
| Publication year | 2021 |
Mark My Words, this is a Heavy Weight to Carry: The Eleventh Circuit Court Sets the Standard Weight Given to a Presumption of Validity of a Registered Mark
Dana Nagel
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The proof is in the pudding. Proving something by a preponderance of the evidence is a tough burden to bear. In any civil case, the party who bears the burden of proof is at a disadvantage from the beginning. Accordingly, courts take their time deciding which party has to ultimately persuade the court to find in its favor. While history has decided many questions about who bears the burden, the same is not true in trademark law.1 Courts have had immense difficulty determining which party, in trademark cases, loses if the evidence is balanced.2 This note examines a continuing split in the courts and a case only recently decided by the United States Court of Appeals for the Eleventh Circuit choosing which approach to ultimately follow.
The Lanham Act3 provides that in a mark's cancellation proceeding, a party who owns a mark registered on the principal register has a rebuttable presumption of validity.4 In effect, this presumption shifts the burden of production5 from the trademark holder to the party seeking
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cancellation of the mark.6 The statute is silent on which party bears the burden of persuasion.7 As a result, circuits are split on the issue. The majority of courts holds that the party seeking cancellation also bears the burden of persuasion.8 A minority of courts holds that the trademark registrant keeps the burden of persuasion.9 Some circuits have yet to decide whether to follow the majority or minority of courts. The United States Court of Appeals for the Eleventh Circuit is one of them. And so, In Royal Palm Props., LLC v. Pink Palm Props., LLC,10 the Eleventh Circuit followed the majority of courts and thus held, the party requesting cancellation of a mark bears both the burden of production and the ultimate burden of persuasion.11
Royal Palm Properties (Royal Palm), a real-estate agency, specialized in buying and selling million-dollar homes in a high-end residential community located in Boca Raton, Florida, called Royal Palm Yacht & Country Club.12 One of Royal Palm's competitors, Pink Palm Properties (Pink Palm), a real-estate brokerage, was also located in Boca Raton, Florida. Pink Palm bought and sold luxury homes in various neighborhoods, including Royal Palm Yacht & Country Club. Only a portion of Pink Palm's business involved Royal Palm Yacht & Country Club's homes.13
Royal Palm applied for and obtained registration on the service mark14 "Royal Palm Properties" in 2012 from the Patent and Trademark Office (PTO).15 In 2015, Royal Palm attempted to register "Royal Palm Properties" combined with an "RP" logo from the PTO. The PTO denied registration of the "composite trademark"16 for being "confusingly
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similar"17 to two existing marks recorded in the Federal Registry in 2007 and 2008.18 These marks, "Royale Palms" and "Royale Palms at Kingston Shores," were registered by a Texas real estate company.19
In 2017, Royal Palm saw a link to property listings in Royal Palm Yacht & Country Club on Pink Properties' website, named "Royal Palm Properties."20 Royal Palm, believing Pink Palm infringed on its trademark, requested that it stop using Royal Palm's mark on its website. Pink Palm eventually took the link down to avoid further dispute. However, Royal Palm claimed the damage was already done.21
Royal Palm filed suit on April 17, 2017, against Pink Palm in the United States District Court for the Southern District of Florida.22 The complaint alleged that in violation of the Lanham Act, 15 U.S.C. § 1114,23 Pink Palm had "infringed its registered service mark, 'Royal Palm Properties.'"24 In its answer, Pink Palm denied infringement and filed a counterclaim for a declaration that Royal Palm's trademark lacked the requirements needed for trademark protection. The jury upheld the service mark but found Pink Palm had not infringed it.25 After the jury returned its verdict, Pink Palm renewed its motion for judgment as a matter of law on its trademark cancellation claim.26 The trial court granted the motion, invalidating the "Royal Palm Properties" registration. The PTO can only register certain "distinctive" marks under the Lanham Act, 15 U.S.C. § 1051(a)(3)(D),27 and the United States District Court for the Southern District of Florida found that the "Royal Palms Properties" mark was not distinctive. The district court found that the PTO wrongly allowed registration of the mark. Therefore, the court held the cancellation of Royal Palm's mark was proper.28
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Royal Palm appealed.29 On appeal, the United States Court of Appeals for the Eleventh Circuit reversed the judgment.30 The court held that Pink Palm had the burden to show, by preponderant evidence, that the mark, "Royal Palm Properties," lacked distinctiveness and failed to make the requisite showing.31
A. Is it Protectable?
A service mark is "any word, name, symbol, or device, or any combination thereof-used by a person . . . to identify and distinguish the services of one person, including a unique service, from the services of others and to indicate the source of the services, even if that source is unknown."32 A mark is distinctive when consumers identify the mark with the represented goods or services.33 A mark can either be "inherently" distinctive or can "acquire distinctiveness."34 There are four categories of distinctiveness.35 One category of distinctiveness is a descriptive term, which identifies a quality or characteristic of a service.36 A descriptive term, since not inherently distinctive, can gain service mark protection only if it acquires distinctiveness through secondary meaning.37
A service mark has acquired secondary meaning when, in the public mind, the name is associated with the source of the service, and not just the service itself.38 In other words, the targeted audience identifies the
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term as a single service from a single company.39 Establishing secondary meaning of a descriptive term requires a high degree of proof.40
The Patent and Trademark Office (PTO) may only grant applications for registration to marks that are distinctive.41 Under Section 2(f) of the Lanham Act,42 marks that have acquired distinctiveness through secondary meaning are permitted registration with the PTO.43 Thus, a service mark registered "under Section 2(f) creates a rebuttable presumption that the mark has attained secondary meaning."44 Once the PTO grants the registration of a mark, it is officially registered on the principal register, provided no party has succeeded in opposing the registration.45
Once a party has registered a trademark, there is a presumption of validity on the mark.46 A party can still petition for cancellation of the mark.47 Under 15 U.S.C. § 1115(a)48 of the Lanham Act, any mark registered by the PTO is "prima facie evidence of the validity of the registered mark and of the registration of the mark."49 Since the Supreme Court of the United States has yet to establish a uniform standard regarding what weight courts should give to prima facie evidence of validity, the lower courts have developed an approach on their own.50
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B. To Share the Burden or Not to Share the Burden
1. The Majority Approach
The majority of courts51 holds that the burden of persuasion is on the party attempting to cancel the registration of a mark, connoting, the party seeking cancellation has the ultimate burden of proving the registration is invalid by a preponderance of the evidence.52 Courts will generally acquiesce to the decision of the PTO in deciding to register a mark.53 In 1958, the United States Court of Appeals for the Second Circuit made one of the earliest showing of deference to PTO's decisions.54 In Aluminum Fabricating Co. v. Season-All Window Corp.,55 the Second Circuit held, where the PTO allowed registration of a mark, a strong presumption of validity of the mark is given.56 The court explained that while the circuit courts have jurisdiction to hear cancellation proceedings, courts should be wary of overruling the actions of the PTO.57 Congress granted the PTO power to make preliminary decisions on whether a mark achieved federal trademark protection.58 The party requesting cancellation must prove that the board erred in registering the mark by a preponderance of the evidence.59 Accordingly, courts should only cancel a registered mark where the opposing party has put forth more evidence than the registrant to tip the scales in its favor.60
The registrant of a mark registered under Section 2(f) of the Lanham Act receives a presumption of acquired distinctiveness.61 In 1994, the United States Court of Appeals for the Eighth Circuit analyzed whether registered marks receive a presumption of both inherent and acquired distinctiveness.62 In Aromatique, Inc. v. Gold Seal, Inc.,63 the court held
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that the presumption given to a mark depends on whether the PTO required evidence of a secondary meaning.64 Since the PTO required Aromatique, Inc. to show proof of secondary meaning, Aromatique, Inc.'s mark retains a strong presumption that the mark has acquired distinctiveness.65 Had the PTO granted Aromatique, Inc. registration without proof of secondary meaning, Aromatique, Inc. would have a strong presumption of inherent distinctiveness.66 A mark is only given a presumption for the kind of distinctiveness it was registered as.67
In the early 2000s, circuit courts began discussing what happens if the party seeking cancellation meets its initial burden of production.68 In Borinquen Biscuit Corp. v. M.V. Trading Corp.,69 the United States Court of Appeals for the First Circuit...
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