The US Court of Appeals for the Sixth Circuit concluded that PERCHVILLE, the name of a winter festival, was inherently distinctive and protectable as a fanciful mark or at the very least as a suggestive mark. AuSable River Trading Post, LLC v. Dovetail Solutions, Inc. et al., Case No. 18-1368 (6th Cir. Aug. 29, 2018) (Sutton, J).

For several decades, the town of Tawas, Michigan, has held a Perchville winter festival. The founders created the Perchville name in 1949 for the sole purpose of identifying the festival. The Tawas Chamber of Commerce (TCC) organizes the yearly festival and owns a federal trademark registration for the PERCHVILLE mark for use on apparel and other goods. TCC dues-paying members may use the PERCHVILLE mark, but third parties are required to pay a $750 licensing fee. AuSable River Trading Post began selling T-shirts bearing the PERCHVILLE mark, but was not a TCC member and did not pay the licensing fee. The TCC sought and received a state court injunction against an AuSable employee for selling PERCHVILLE T-shirts. In response, AuSable sued the TCC to invalidate the PERCHVILLE registration. The district court granted the TCC’s motion for summary judgment, holding that the PERCHVILLE mark was inherently distinctive and protectable. AuSable appealed.

The Sixth Circuit affirmed the district court’s decision. Before reaching the merits of the case, the Court explained the different types of marks and their levels of protectability: inherently distinctive trademarks (fanciful, arbitrary and suggestive) are the most protectable, and generic marks are not protectable at all. The Court held that PERCHVILLE was “almost certainly” a fanciful mark and at the very least was a suggestive mark because it was coined to identify the festival, it does not have an independent meaning, and it cannot be found in the dictionary. Alternatively, the Court held that the combination of perch (referring to a fish) and -ville (referring to a fictitious place or concept with particular characteristics) to create PERCHVILLE may suggest a gathering of fisherman, but even that meaning requires imagination and perception—the hallmarks of a suggestive mark.

In support of its quest to invalidate the mark, AuSable argued that PERCHVILLE is an unprotectable generic mark because people associate the mark with the festival and not the TCC. The 1984 Amendment to the Lanham Act, however, precludes this argument: a mark cannot be generic simply because it is used as the name of, or to identify, a unique product or service.

AuSable next argued that PERCHVILLE was a generic word, like thermos or trampoline, because it was part of the general lexicon of Tawas residents. The Court rejected this analogy, holding that PERCHVILLE refers to a single event that has one source, unlike the word thermos, which refers to a general class of containers for holding hot beverages made by many different companies. AuSable also argued that PERCHVILLE is not fanciful because it consists of two words commonly found in the dictionary, which when combined, suggest a city with a certain type of fish. The Court found that by conceding that the mark suggests an imaginative city, AuSable defeated its own argument.

Finally, AuSable argued that the TCC abandoned the PERCHVILLE mark when it allowed others to use the mark and allowed the registration to lapse in 2013. The Court held that use of a trademark by others does not mean the trademark owner has abandoned the mark, especially when the owner licenses the mark and actually uses the PERCHVILLE mark on buttons, as here. Moreover, the Court found that the fact that the TCC accidentally let the PERCHVILLE registration lapse did not constitute abandonment because the TCC immediately filed a new application for the mark.