Source: http://ipmall.law.unh.edu/content/ttab-trademark-trial-and-appeal-board-1-mark-linville-v-meril-rivard-cancellation-no-19-874
Timestamp: 2019-04-21 12:08:47+00:00

Document:
This case comes up on petitioner's motion for summary judgment.
On June 10, 1991 Mark Linville filed a petition to cancel Meril Rivard's registration for ULTRACUTS for hair dressing and beauty salon services. [FN1] Rivard, a Canadian citizen, obtained the registration pursuant to Section 44(e) of the Trademark Act, on the basis of a Canadian registration. As grounds for cancellation, petitioner has alleged that respondent has made no use of the mark in connection with the services in the United States, that petitioner has used the mark ULTRACUTS in connection with haircutting, styling and salon services since as early as December 30, 1983, and that respondent's use of the mark for his services is likely to cause confusion. Respondent denied the essential allegations of the petition in his answer. On September 15, 1992, petitioner filed an amended petition, alleging that respondent's registration was obtained pursuant to Section 44(e) of the Trademark Act; that apart from use by any licensee from which respondent purchased rights after the cancellation proceeding was instituted, respondent has made no use of the mark in connection with the services in the United States for a five-year period from the date of registration to the date the petition for cancellation was filed; [FN2] that respondent abandoned his registered mark; that respondent's subsequent purchase of rights to ULTRACUTS for hair salon services does not cure the abandonment; that petitioner has used the mark ULTRACUTS in the United States in connection with the rendering and sale of haircutting, styling and salon services since prior to the date the petition for cancellation was filed; and that petitioner is damaged by respondent's registration in that it is an obstacle to petitioner's registration of the same mark.
In his answer to the amended petition for cancellation respondent admitted that he personally made no sales of hairdressing and beauty salon services under the mark in United States, apart from the sales of his licensees, and denied petitioner's remaining salient allegations. He also alleged, as affirmative defenses, that the petition fails to state a claim upon which cancellation can be granted; that petitioner is not damaged by the registration and lacks standing; and that petitioner is guilty of laches, estoppel and acquiescence by his failure to assert his claim against respondent until June 1991.
In his motion for summary judgment petitioner asserts that there are no genuine issues that respondent did not personally operate a hairdressing or beauty salon from a location within the United States between the date the registration issued on August 26, 1986 and August 1991, such fact having been admitted by respondent in answer to petitioner's request for admissions. [FN3] Further, petitioner asserts that respondent has not made any satisfactory explanation for the nonuse. In support of this, petitioner has submitted certain of respondent's responses to interrogatories, document production requests and requests for admissions.
*2 Petitioner asserts that he has established a prima facie case of abandonment by proving that respondent did not personally use the mark ULTRACUTS in the sale of hairdressing or beauty salon services in the United States "for more than two years preceding the filing of the August 1991 petition for cancellation." Brief, p. 8. Moreover, petitioner asserts that respondent has not provided sufficient evidence, through his discovery responses, to raise a viable defense of excusable nonuse. Finally, petitioner has made a reference to a claim by respondent that in 1992 he purchased rights to the ULTRACUTS mark from three separate users who have operated salons under the ULTRACUTS name in the United States since prior to the issuance of respondent's registration. Petitioner argues that "any use to which respondent became entitled by the purchase of rights does not have the effect of reviving the abandonment which occurred before the purchase of rights."
He owns 33 hair dressing and beauty salons and franchises two others, all of which are located in Canada and operated under the mark ULTRACUTS, and he also has three licensees operating salons under the name ULTRACUTS or ULTRACUT in Wilkes-Barre, Pennsylvania, Westland, Michigan, and San Diego, California.
Respondent started using ULTRACUTS in 1982 for a store in Saskatchewan. His business now generates, exclusive of his licensees' sales, $5 million in annual revenues. In addition to the shampooing, styling, coloring and perming services customarily performed at hairdressing and beauty salons, respondent's stores have, since 1985, sold hair care products under the mark ULTRACUTS. These products have been manufactured since 1986 by a company in Nebraska which ships them to respondent's stores in Canada. Respondent has also purchased products from companies in Minnesota. Respondent believes that customers expect to be able to purchase at salons the products used on their hair, and that the products are an essential part of his service business. Respondent also buys magazines from a U.S. company for customers to read in his stores.
As early as December 5, 1984, respondent sought ways to expand his business by opening ULTRACUTS salons in the United States, and "began visiting various places in the U.S. to meet with knowledgeable people concerning the demographics and possible geographic locations, as well as to discuss franchises with possible franchisees. He met with Cordco Commercial and Industrial Real Estate people in Hawaii in late 1984 regarding site selection in Hawaii, and corresponded with Franchise Business Inc. in Minnesota in June 1987 to seek assistance in obtaining franchisees in the United States. However, because of the legal complexities of offering franchises in Minnesota, he did not pursue franchises at that time. In November 1988 he travelled to Las Vegas, Nevada to evaluate potential store sites and evaluate the competition, but did not open a store there because of economic considerations. In June 1989, July 1990 and April 1991 he travelled to Grand Forks, ND and East Grand Forks, MN, to review potential sites for new salons, and on these visits discussed leasing space with the agent at a mall in Grand Forks, although no agreement was reached.
*3 In May and June, 1989, Mr. Rivard visited hair salons in Tampa, Florida to determine their pricing and manner of operation, and also, in June 1989, and January and March 1990, visited salons in two locations in and near St. Paul, MN.
Mr. Rivard also met with his store managers and other employees for an annual sales meeting in Las Vegas in January 1990, and had another ULTRACUTS sales meeting in Los Angeles in January 1992.
Moreover, between 1987 and 1989 Mr. Rivard got married and had two children.
Since 1982 respondent has advertised his services on various Canadian radio stations, and these commercials are heard both in Canada and the United States. He has also, since 1982, advertised his salons in various Canadian newspapers, some of which are in cities which are close to the northern United States, and which he believes are read by U.S. residents.
Some of respondent's Canadian salons attract customers from the United States, including a regular customer from Cutbank, Montana and one from Spokane, Washington. He estimates that between 1986 and 1991 annual sales of ULTRACUTS services and products sold to U.S. residents were in excess of $25,000.
In 1990, in connection with the efforts of the Brandon, Manitoba Economic Development Board to bring U.S. tourists to Manitoba, respondent distributed ULTRACUTS promotional giveaways and coupons from a booth at the North Dakota State Fair.
With respect to the licensees, respondent stated that during the course of the instant proceeding he became aware of third parties who were using the mark ULTRACUTS in connection with hair dressing and beauty salon services, and he visited owners of three salons, located in Michigan, California and Pennsylvania. Having ascertained that each of these persons had been using the name ULTRACUTS or ULTRACUT continuously since as early as the summer of 1983, he entered into assignment and license agreements with them, by which they sold to him whatever rights they owned in the name ULTRACUTS in exchange for a license back to continue operating their salons under the mark ULTRACUTS or ULTRACUT.
Petitioner has filed a reply brief, in which he objects to much of the evidence submitted by respondent in his opposing papers on the ground that the material is either hearsay or was not produced in response to discovery requests and therefore cannot now be relied on by respondent.
We note, initially, that the consideration of reply briefs on motions is discretionary, since the Trademark Rules neither provide for nor prohibit such briefs. Although the Board generally discourages the filing of reply briefs, in this case, because petitioner's reply brief comments on the substantial material submitted by respondent in his opposing papers, and also contains objections to much of this material, we have elected to consider this paper.
respondent objected that the interrogatory was "vague, ambiguous, unduly broad and burdensome." The same objection was made to a request to produce all documents "which refer or relate to steps taken by Registrant to use or prepare for use of the mark ULTRACUTS for hair dressing or beauty salon services rendered from a location in the United States between the date the registration was issued on August 26, 1986 and the date the Petition for Cancellation was filed in August 1991 [sic]."
Similarly, petitioner's objection that respondent produced certain responses after the close of discovery does not preclude respondent from submitting these documents as part of his opposing papers. Respondent sent certain documents to petitioner on November 10, 1992, the date the discovery period closed, explaining that "they were only recently discovered by us." Thus, there does not appear to be any issue that the original response was not supplemented seasonably pursuant to Fed.R.Civ.P. 26(e). Moreover, these responses were served prior to the filing of petitioner's motion for summary judgment, so there is no basis for asserting prejudice.
Turning then to the merits of petitioner's motion, we begin with the oft-stated principle that the purpose of summary judgment is one of judicial economy, that is, to save the time and expense of a useless trial where no genuine issue of material fact remains and more evidence than is already available in connection with the summary judgment motion could not reasonably be expected to change the result. Pure Gold, Inc. v. Syntex (U.S.A.), Inc., 739 F.2d 624, 222 USPQ 741 (Fed.Cir.1984). It is also well settled that the party moving for summary judgment has the burden of establishing the nonexistence of any genuine issue of fact, and that all doubts are to be resolved against the moving party. Care Corp. v. Nursecare Int'l, Inc., 216 USPQ 993 (TTAB 1982).
There is no genuine issue as to petitioner's standing, petitioner having testified to his use of ULTRACUTS as a service mark for four hairdressing and hair styling salons, and having submitted evidence that his application for ULTRACUTS has been refused in view of respondent's registration.
When its use has been discontinued with intent not to resume such use. Intent not to resume may be inferred from circumstances. Nonuse for two consecutive years shall be prima facie evidence of abandonment. "Use" of a mark means the bona fide use of that mark made in the ordinary course of trade, and not made merely to reserve a right in a mark.
*5 There is no genuine issue that respondent did not use his mark for services rendered in the United States between 1986, when his registration issued, and 1991, when the petition for cancellation was filed. This, as a matter of law, establishes prima facie abandonment of the mark, because once a registration issues on the basis of Section 44, it stands on the same footing as any other registration, the registration date being the trigger of the two-year period for commencing use. See, Oromeccanica, Inc. v. Ottmar Botzenhardt, 223 USPQ 59 (TTAB 1983), rev'd on other grounds, 226 USPQ 996 (CD Cal 1985). The terms "use" and "nonuse" in the statute mean use and nonuse in the United States. Imperial Tobacco Ltd. v. Philip Morris Inc., 899 F.2d 1575, 14 USPQ2d 1390, 1393 (Fed.Cir.1990).
the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services.
Respondent also argues that his services are rendered in commerce because of the effect on commerce which is created by his business, i.e., customers must travel from the United States to Canada in order to obtain his services, and therefore the customers travel in commerce. Respondent cites Larry Harmon Pictures Corp. v. The Williams Restaurant Corp., 929 F.2d 662, 18 USPQ2d 1292 (Fed.Cir.1991) and Penta Hotels, Ltd. v. Penta Tours, 9 USPQ2d 1081 (D.Conn.1988) in support of his position, but both those cases involved services which were actually rendered in the United States, i.e., a restaurant located in Tennessee and a hotel in New York which attracted interstate travelers. Those fact situations are manifestly different from that presented here, where during the relevant time period respondent's hair salons were located only in Canada.
The question here is a right to registration. A foreign trademark may be known by reputation in this country and may even be protectable under concepts of unfair competition, but such mark is not entitled to either initial or continued registration where the statutory requirements for registration cannot be met.
*6 14 USPQ2d at 1393.
In that case, the opposer, an entity offering restaurant services in Canada, had provided evidence that it had distributed promotional materials for its Canadian restaurants at tourist information booths, and that Americans had dined in the restaurants.
Finally, respondent argues that it sells in his Canadian salons hair care products which are manufactured in and shipped from the United States. Although these products may be sold through his hair salon business, the products themselves do not constitute part of hair dressing and beauty salon services.
Once a prima facie case of abandonment has been made, the burden shifts to the respondent to provide evidence of intent to resume use. In this case, because the instant registration was obtained pursuant to Section 44, without any allegations of use, and because this is a summary judgment motion, the question is whether respondent, like any other registrant who has not made use for at least two years, has put forth sufficient evidence to at least raise a genuine issue that its nonuse was excusable. Imperial Tobacco Ltd. v. Philip Morris Inc., supra.
We conclude that respondent's evidence is not sufficient to raise a genuine issue as to whether he had a viable defense of excusable nonuse. In the two-year period between August 1986, when his registration issued, and August 1988, the only effort made by Mr. Rivard in connection with rendering his services in the United States was to correspond with Franchise Business, Inc. to seek assistance in obtaining ULTRACUTS franchisees in the United States, but he determined not to pursue franchises because of the complexities of Minnesota franchise law. A decision not to pursue franchising arrangements cannot be considered a reasonable excuse for nonuse of the mark for hair dressing and beauty salon services in the United States.
*7 Even after the initial two-year nonuse period, Mr. Rivard's efforts, despite resolving all doubts in favor of the nonmoving party, evidence a pattern of deciding not to offer hair salon services in the United States. For example, in November 1988, Mr. Rivard stated that he went to Las Vegas "to evaluate potential store sites and to evaluate the competition," and decided not to open a store there.
We also note that during the period 1987-89 respondent married and had two children. While personal problems can be a basis for excusable nonuse, e.g., a one-person business where the owner underwent surgery and then was imprisoned, Clubman's Club Corp. v. Martin, 188 USPQ 455 (TTAB 1975), respondent has pointed to no cases in which "marrying and starting a family" has been held to be a valid excuse for nonuse of a mark.
Accordingly, we find that respondent has not raised a genuine issue which would excuse his nonuse of the mark.
We think it appropriate to make some comment regarding respondent's recent acquisition of rights in ULTRACUTS and ULTRACUT for hair dressing services, and his license of these rights to his assignors. Contrary to respondent's assertions, these assignments and licenses back do not demonstrate either a genuine issue as to whether respondent's earlier nonuse was excusable, nor do they rebut the prima facie case of abandonment made by petitioner. That is, respondent cannot cure his nonuse of the mark for five years, and his consequent abandonment of it, by acquiring the rights of third parties and relying on their licensed use, any more than the respondent in the Imperial Tobacco case could cure its six-year period of nonuse by subsequently making use. The licensed use must be considered in the nature of a new use. Abandonment cannot be cured by subsequent readoption of a mark. First National Bank of Omaha v. Autoteller Systems Service Corp., 9 USPQ2d 1740 (TTAB 1988).
*8 Petitioner's motion for summary judgment is granted, the petition for cancellation is granted, and the registration will be cancelled in due course.
FN1. Registration No. 1,407,173, issued August 26, 1986; Section 8 affidavit accepted.
FN2. It is noted that, although the amended petition refers to a five-year period, and petitioner, throughout his motion for summary judgment, refers to his petition being filed in August 1991, the original petition for cancellation was actually filed on June 10, 1991, which was two months prior to the expiration of the five-year period from the registration of respondent's mark on August 26, 1986. It is also noted that the ground of priority of use and likelihood of confusion is a valid ground for cancellation of a registration which is not yet five years old, and that, although this ground was alleged in petitioner's original petition for cancellation, it has been omitted from the amended petition, which is based solely on the ground of abandonment.
FN3. As noted previously, petitioner characterizes August 1991 as the date the petition for cancellation was filed, although the petition was in fact filed on June 10, 1991.
FN4. We note that, if respondent did not use his mark in commerce at all, technically he would not "resume" use.

References: v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v.