Julie A. Moreno v. Pro Boxing Supplies, Opp. Nos. 91214580, 91214877, Canc. No. 92058878 (T.T.A.B. Sept. 8, 2017)

In a recent precedential case, the Trademark Trial and Appeal Board (“TTAB”) found that use of a mark by a licensor does not inure to the benefit of a licensee for the purpose of establishing priority.

Deportes Casanova, a Mexican producer of boxing gloves and related equipment, claimed use of the mark CASANOVA in the United States since at least 1972. Notably, CASANOVA gloves were worn by Rocky Balboa in the first Rocky movie in 1976. However, Deportes Casanova never applied to register CASANOVA in the United States.

Pro Boxing Supplies (“Pro Boxing”) started using the CASANOVA mark in approximately 1987, when it purchased CASANOVA boxing gloves made in Mexico through a vendor and sold the gloves in the United States. When, a few years later, the vendor could no longer acquire the gloves, Pro Boxing began to manufacture and sell CASANOVA gloves on its own. Pro Boxing owns a registration for the mark CASANOVA (issuing from an application filed on October 22, 2012) and two pending applications filed in March 2013 to register the same mark in design form, all in connection with boxing equipment. In July 2013, Julie Moreno entered into a license agreement with Deportes Casanova that granted her exclusive rights in the United States to sell Deportes Casanova products produced by the licensor and to use the CASANOVA mark. The license agreement specified that Moreno had no ownership interest in Deportes Casanova’s intellectual property, but named Moreno as Deportes Casanova’s “representative” in the United States for the purpose of protecting the licensor’s rights.

In January 2014, Moreno petitioned to cancel Pro Boxing’s registration and opposed its applications on the basis of Deportes Casanova’s alleged prior common law rights in the CASANOVA mark in the United States dating from many years prior to Pro Boxing’s priority dates. Pro Boxing first challenged Moreno’s standing, claiming that her license agreement with Deportes Casanova was invalid, including because it allegedly lacked a quality-control provision. The TTAB disregarded that claim, noting that Moreno was a reseller, not a manufacturer, and finding that the quality control was therefore inherent in the license itself.

However, the TTAB found of its own accord that Moreno, as a mere licensee, could not establish priority based on Deportes Casanova’s claimed common law use of the CASANOVA mark. The Board noted that use of a mark by a licensee inures to the benefit of a licensor, but found that this is because the licensor is the entity that controls the quality of the goods or services sold under the mark. Ultimately, the Board held that “[a]llowing a licensee to claim priority for itself in an inter partes proceeding based on the licensor’s use of the mark (whether through the license or otherwise), could result in a licensee being able to claim de facto ownership of the licensed mark.” Slip Op. at 18. Given that the license explicitly did not grant Moreno any ownership interest in the CASANOVA mark, she did not inherit the licensor’s pre-existing rights. Therefore, even though Moreno had standing to enforce Deportes Casanova’s rights as exclusive licensee of the CASANOVA mark, she could not rely on the licensor’s use to prove priority of rights over Pro Boxing and could not prevail in the dispute.

This decision may present a conflict with the Federal Circuit’s Jewelers Vigilance rulings, which held that, in order to bring an opposition based on prior rights in a mark, “someone must have proprietary rights in the [mark], but such rights need not reside in the opposer if the opposer otherwise has standing to bring the opposition.” Jewelers Vigilance Committee, Inc., Appellant, v. Ullenberg Corp., 853 F.2d 888, 893 (Fed. Cir. 1988). Here, contrary to Jewelers Vigilance, the TTAB seems to have required that the opposer own rights in the mark in order to succeed in an opposition. Given that Moreno was able to establish standing, it seems under the logic of Jewelers Vigilance that she should have been able to rely on Deportes Casanova’s use to prove priority and therefore to enforce the licensor’s rights in CASANOVA.

Deportes Casanova may still assert its rights in CASANOVA by bringing a new proceeding in its own name against Pro Boxing. In the future, however, exclusive licensees seeking to enforce the rights of a licensor must bear in mind that while they may have standing to enforce those rights without involving the licensor in the proceeding, they must name the licensor as a co-plaintiff in order to get the benefit of the licensor’s priority.