Applicant asserted counterclaims for fraud against Opposer’s registrations covering Classes 5 and 35 based on Opposer’s failure to use the marks in connection with the Class 35 services only. Opposer subsequently deleted the Class 35 services from its registrations through its required Section 8 filings. Thereafter, Opposer moved to dismiss the counterclaims against the Class 35 services as moot because those services had been deleted, and to dismiss the counterclaims against Class 5 for failure to state a claim. The TTAB denied Opposer’s motion to dismiss the counterclaims against the Class 35 services and granted judgment for Applicant as to those services. The TTAB granted Opposer’s motion to dismiss Applicant’s counterclaims as to Class 5, however, finding that fraud as to Opposer’s Class 35 services did not, in itself, require cancellation of the registrations as to the Class 5 goods.
G W Pharma Limited (“Applicant”) filed an application to register the design mark GW PHARMACEUTICALS, shown below, for a variety of pharmaceutical and veterinary preparations in Class 5, as well as various goods and services in Classes 9, 10, 16, 20, 31, 41, 42, and 44.
(click here for image)
G&W Laboratories, Inc. (“Opposer”) owned trademark registrations for the word mark G&W and the design mark G&W shown below, covering suppositories, tablets, and pharmaceutical preparations in Class 5 and distributorships in the field of suppositories and pharmaceutical preparations in Class 35.
(click here for image)
Opposer filed a notice of opposition against Applicant’s GW PHARMACEUTICALS mark on the grounds of priority and likelihood of confusion. In its answer, Applicant counterclaimed for cancellation of both of Opposer’s registrations in their entireties on fraud grounds, alleging that Opposer had not used either mark for distributorship services in Class 35. In subsequent filings under Section 8 of the Trademark Act (Declaration of Continued Use), Opposer deleted the Class 35 services from both registrations. Thereafter, Opposer filed a motion to dismiss Applicant’s counterclaims against Class 35 as moot, and to dismiss the counterclaims against Class 5 for failure to state a claim.
In support of its motion to dismiss, Opposer argued that Applicant’s counterclaims were based solely on the contention that Opposer fraudulently obtained its registrations as to Class 35, and not as to the goods in Class 5. While admitting that it had never used its marks in connection with Class 35 services, Opposer argued that its deletion of Class 35 from both registrations rendered Applicant’s counterclaims moot. In response, Applicant argued that Opposer’s deletion of Class 35 from its registrations could not cure the underlying fraud, and that if fraud was shown as to Opposer’s Class 35 services, both registrations were subject to cancellation in their entireties.
The TTAB denied Opposer’s motion to dismiss the counterclaims with respect to Class 35, noting that it was well settled that a fraud claim cannot be rendered moot by the deletion of the challenged services through a Section 8 filing. In an apparent retreat from the implications of its earlier Medinol line of cases, however, the TTAB rejected Applicant’s contention that fraud as to one class of a multiclass registration subjects the entire registration to cancellation. Noting that all of the cases considering fraud since Medinol had involved single-class applications or registrations, the TTAB indicated that it had not had occasion to consider whether fraud in less than all classes of a multiclass registration would subject the entire registration to cancellation for fraud. The TTAB pointed out that while the U.S. registration system permits multiclass applications, such an applicant should be considered as being in the same position as if it had filed multiple single-class applications. Accordingly, the TTAB reasoned, each class of a multiclass registration must be considered separately for fraud purposes and a finding of fraud as to one class should not, in itself, require cancellation of all classes in that registration. In a footnote, the TTAB recognized that holding otherwise would provide an incentive against filing multiclass applications, and that no justification existed for treating applications or registrations differently based solely on whether the applicant sought single-class or multiclass registrations.
Turning to Applicant’s counterclaims seeking cancellation of the registrations as to Class 35, the TTAB noted that where, after commencement of a cancellation proceeding, a respondent applies for cancellation of the involved registration under Section 7(e) of the Act without written consent of the adverse parties, judgment must be entered against the respondent. Because Opposer’s request to delete the Class 35 services was, in effect, a voluntary cancellation of the registration as to that class under Section 7(e), the TTAB entered judgment against Opposer as to Class 35. The TTAB dismissed Applicant’s counterclaims as to Class 5.
This decision significantly curtails the reach of the TTAB’s decision in Medinol by holding that a finding of fraud relative to one class in a multiclass application does not, in itself, require cancellation of the registration in its entirety.