Judges: Rader, Clevenger (author), Prost [Appealed from PTO, Trademark Trial and Appeal Board]

In First Niagara Insurance Brokers, Inc. v. First Niagara Financial Group, Inc., No. 06-1202 (Fed. Cir. Jan. 9, 2007), the Federal Circuit reversed the Trademark Trial and Appeal Board’s (“TTAB”) decision rejecting First Niagara Insurance Brokers, Inc.’s (“FN-Canada”) opposition to the registration of certain marks by First Niagara Financial Group, Inc. (“FN-US”).

FN-Canada is a Canadian insurance broker. It works with U.S.-based brokers and underwriters to sell insurance to U.S. citizens that own property in Canada, and to Canadians that travel or do business in the United States. FN-Canada uses several FIRST NIAGARA marks in advertising that reaches the United States and in correspondence to its U.S. customers and business partners.

In January 2000, FN-US, a New York insurance broker with customers in the United States and Canada, filed applications to register six FIRST NIAGARA marks. FN-Canada opposed those applications, arguing that consumers were likely to confuse the parties’ marks. In its defense, FN-US argued that FN-Canada could not establish prior rights in the FIRST NIAGARA mark because its marks had not been used “in commerce” regulable by Congress (i.e., interstate commerce) under 15 U.S.C. § 1127. FN-Canada did not challenge the use “in commerce” standard advocated by FN-US. Instead, FN-Canada argued that its evidence was sufficient to meet that standard.

The TTAB applied the use “in commerce” standard and concluded that FN-Canada failed to prove that its marks were used in interstate commerce. On that basis, the TTAB dismissed FN-Canada’s oppositions.

On appeal, FN-Canada did not challenge the use “in commerce” standard applied by the TTAB, the TTAB having held that argument waived. Instead, FN-Canada argued that the TTAB erred in finding that its evidence failed to meet that standard. The Federal Circuit reversed the TTAB’s decision, finding that the TTAB applied the wrong standard. The Court held that the TTAB erred by requiring FN-Canada to prove that its marks had been used in interstate commerce, when Section 2(d) requires proof only that FN-Canada’s marks were “used in the United States.” The Court explained that Section 2(d) of the Lanham Act prohibits registration of marks that are likely to cause confusion, mistake, or deception with other marks that are registered with the PTO or “previously used in the United States.” Thus, an opposing party is required to show that its mark has been used in the United States but is not required to prove use in interstate commerce.

The Court also noted that the use “in commerce” standard applied by the TTAB is contrary to well-established law, which allows a party to oppose an application or cancel a registration based on purely intrastate use of a mark. Although FN-Canada waived its challenge to the standard applied by the TTAB by failing to raise it on appeal, the Court nonetheless raised the issue on its own because it considered it “imprudent” to render a decision that treated Section 2(d) as requiring use “in commerce” instead of “use in the United States.” Applying the correct standard, the Court concluded that the TTAB erred in dismissing FN-Canada’s oppositions. The Court explained that “[t]he record unquestionably reveals more than ample use of FN-Canada’s marks in the United States to satisfy the use requirements of Section 2(d).” Slip op. at 7. The Court thus reversed the TTAB’s decision and remanded the case.