Source: http://legalarium.com/ttabquotes/NotRightfulOwner.html
Timestamp: 2019-04-21 14:04:56+00:00

Document:
The resolution of a service mark dispute between a landlord and tenant depends on the facts and a weighing of policies and circumstances of each case.
"According to Professor McCarthy, the resolution of a service mark dispute between a landlord and tenant depends on the facts and a weighing of policies and circumstances of each case. ""Ownership of a service mark identifying a business carried on at rented premises will depend upon weighing of the policies of customer perception and contractual provisions between the landlord and tenant."" McCarthy on Trademarks and Unfair Competition §16:38 (4th ed. 2008)."
Accordingly, ownership of a mark may be acquired through its use by a controlled licensee, even though the trademark owner itself does not use the mark.
Accordingly, ownership of a mark may be acquired through its use by a controlled licensee, even though the trademark owner itself does not use the mark. Central Fidelity Banks, Inc. v. First Bankers Corporation of Florida, 225 USPQ 438, 439-440 (TTAB 1984); In re Raven Marine, Inc., 217 USPQ 68, 69 (TTAB 1983); Warner Bros. Inc. v. Road Runner Car Wash, Inc., 189 USPQ 430, 431 (TTAB 1976); Basic Incorporated v. Rex, 167 USPQ 696, 697 (TTAB 1970).
Case Finding: Discussion of ownership of the JOYCE marks.
After petitioner purchased the Elgin Theater, it established respondent to operate the theater. Petitioner controlled respondent from respondent's creation until 1993 by virtue of the interlocking directors comprising Eliot Feld, Cora Cahan and Peter Felcher. In fact, respondent was designed so that petitioner would maintain effective control over it. Under these circumstances, we find that petitioner selected the JOYCE name and intended to control its use through an authorized licensee. We agree with Eliot Feld that it would be "ludicrous" to contend that petitioner did not own the JOYCE marks after petitioner purchased the Elgin Theater, did all the work raising the funds and renovating the theater, and took all of the risk involved in the undertaking. Moreover, petitioner's claim of ownership is further supported by the decision that the theater would be called the Joyce Theater forever because no matter who managed the theater for petitioner, the theater would always be called the Joyce Theater.
Case Finding: As indicated above, we have determined that petitioner is the owner of the JOYCE marks and that respondent is using the marks by virtue of an implied license. Petitioner's failure to object to respondent's use of the JOYCE SOHO mark does not prove that petitioner has not exercised quality control over the services rendered under the marks. In other words, petitioner's failure to object to the JOYCE SOHO mark does not amount to an abandonment of petitioner's trademark rights in the JOYCE marks. We find that petitioner is exercising sufficient control over the JOYCE marks by virtue of the lease between the parties and through its performances at the theater. See Woodstock's Enterprises Inc. (California) v. Woodstock's Enterprises Inc. (Oregon), 43 USPQ2d at 1447 (no uncontrolled use resulting in the mark losing all of its source significance); University Book Store v. University of Wisconsin Board of Regents, 33 USPQ2d at 1396 (third-party use of college mascot was not uncontrolled use resulting in abandonment; rather it was a royalty-free, implied license).
As indicated above, we have determined that petitioner is the owner of the JOYCE marks and that respondent is using the marks by virtue of an implied license. Petitioner's failure to object to respondent's use of the JOYCE SOHO mark does not prove that petitioner has not exercised quality control over the services rendered under the marks. In other words, petitioner's failure to object to the JOYCE SOHO mark does not amount to an abandonment of petitioner's trademark rights in the JOYCE marks. We find that petitioner is exercising sufficient control over the JOYCE marks by virtue of the lease between the parties and through its performances at the theater. See Woodstock's Enterprises Inc. (California) v. Woodstock's Enterprises Inc. (Oregon), 43 USPQ2d at 1447 (no uncontrolled use resulting in the mark losing all of its source significance); University Book Store v. University of Wisconsin Board of Regents, 33 USPQ2d at 1396 (third-party use of college mascot was not uncontrolled use resulting in abandonment; rather it was a royalty-free, implied license).
Sufficient control by a licensor may exist despite the absence of any formal arrangements for policing the quality of the goods sold or services rendered under the mark by its licensee.
Based on the evidence of record, we find that petitioner informally, rather than formally, monitored the quality of the services rendered by respondent under the JOYCE marks. While there was no specific program or particular procedures for inspecting the services, nevertheless, petitioner's efforts to control the nature and quality of the services rendered under the JOYCE marks are sufficient to support the licensing relationship. Stock Pots Restaurant, Inc. v. Stockpot, Inc., 737 F.2d 1576, 222 USPQ 665, 667-668 (Fed. Cir. 1984) (defendant exercised sufficient control over the use of its mark through the provisions of a lease); Woodstock's Enterprises Inc. (California) v. Woodstock's Enterprises Inc. (Oregon), 43 USPQ2d at 1446 ("Sufficient control by a licensor may exist despite the absence of any formal arrangements for policing the quality of the goods sold or services rendered under the mark by its licensee(s)").
Case Finding: Based on the facts and circumstances forming the relationship of the parties, we find that petitioner is the owner of the JOYCE marks and that respondent is using the JOYCE marks pursuant to an implied license.
Based on the facts and circumstances forming the relationship of the parties, we find that petitioner is the owner of the JOYCE marks and that respondent is using the JOYCE marks pursuant to an implied license.
Case Finding: Finding that the course of conduct between the parties created an implied license.
Contrary to the facts in Bazaar Del Mundo, in these proceedings we find that the course of conduct between the parties created an implied license. First, when petitioner purchased the Elgin Theater and then formed respondent, petitioner intended to own the name of the theater and license it to respondent. Second, petitioner designed respondent so that petitioner could maintain control over it and, thus, maintain control over the name of the theater. Third, the lease, as evidence of the dealings between the parties, provides that respondent must render "first class" dance theater services, cannot make alterations or changes to the theater without petitioner's consent, and upon termination of the lease for any reason, including a default or breach by respondent, respondent must surrender the premises, including any alterations, to Petitioner. In addition, the lease provides petitioner with a right to enter and inspect the premises. Finally, by virtue of petitioner's use of the theater, petitioner has monitored the nature and quality of the services rendered under the JOYCE marks.
Case Finding: Contrary to respondent's argument, the fact that respondent was the first entity to use the JOYCE marks does not make it the owner of the marks because of our finding that respondent used the marks pursuant to the license with petitioner.
FOOTNOTE 68 "Contrary to respondent's argument, the fact that respondent was the first entity to use the JOYCE marks does not make it the owner of the marks because of our finding that respondent used the marks pursuant to the license with petitioner. See Respondent's Brief, p. 23."
Although documents produced in response to document production requests cannot normally be made of record by notice of reliance, the parties filed a stipulation that documents exchanged during discovery are authentic and may be made of record by either party.
FOOTNOTE 8 "Although documents produced in response to document production requests cannot normally be made of record by notice of reliance (see Trademark Rule 2.120(j)(3)(ii), 37 CFR §2.120(j)(3)(ii)), the parties filed a stipulation that documents exchanged during discovery are authentic and may be made of record by either party. See TBMP §704.11 (2nd ed. rev. 2004)."
Ownership of a service mark may be acquired through controlled use by one's related companies (or licensees) even in the absence of any use by the purported trademark owner.
In reaching this conclusion, we start with the premise that ownership of a service mark may be acquired through controlled use by one's related companies (or licensees) even in the absence of any use by the purported trademark owner.
In this case, where there are no express contractual provisions between the parties regarding the ownership and use of the JOYCE marks, we will have to examine the dealings of the parties to determine the ownership of the JOYCE marks and whether there was an informal system of quality control sufficient to support an implied license. McCarthy on Trademarks and Unfair Competition §18:43.50 (4th ed. 2008) ("Some courts will imply both a trademark license and a requirement for quality control from the dealings of the parties"). See also Woodstock's Enterprises Inc. (California) v. Woodstock's Enterprises Inc. (Oregon), 43 USPQ2d 1440, 1446 (TTAB 1997) ("Sufficient control by a licensor may exist despite the absence of any formal arrangements for policing the quality of the goods sold or services rendered under the mark by its licensee(s)"); University Book Store v. University of Wisconsin Board of Regents, 33 USPQ2d 1385, 1396 (TTAB 1994) ("the reality of the situation which existed for many years may best be characterized as that of a royalty-free, nonexclusive, implied license to use the marks"); Winnebago Industries, Inc. v. Oliver & Winston, Inc., 207 USPQ 335, 341 (TTAB 1980) (the record established that opposer employed an informal, rather than formal, system of quality control); Ideal Toy Corporation v. Cameo Exclusive Products Inc., 170 USPQ 596, 598 (TTAB 1971) (although the agreement between the parties did not address defendant's right to control the nature and quality of the goods sold under the mark at issue, defendant's CEO could, in fact, control the nature and quality of the goods).
Case Finding: Petitioner believed that respondent's expansion to the JOYCE SOHO Theater was consistent with the mission and goals of the original Joyce Theater, and that it was an acceptable use of the Joyce name at that theater. Therefore, petitioner saw no reason to object to respondent's use of the JOYCE SOHO service mark.
Moreover, petitioner believed that respondent's expansion to the JOYCE SOHO Theater was consistent with the mission and goals of the original Joyce Theater, and that it was an acceptable use of the Joyce name at that theater. Therefore, petitioner saw no reason to object to respondent's use of the JOYCE SOHO service mark.
Control may also be adequate where the licensor justifiably relies on the integrity of the licensee to ensure the consistent quality of the services performed under the mark.
Moreover, we construe petitioner's compliance with the terms of the Joyce Theater performance rental agreement as petitioner's delegation to respondent to police the use of the JOYCE marks. Woodstock's Enterprises Inc. (California) v. Woodstock's Enterprises Inc. (Oregon), 43 USPQ2d at 1446 ("Control may also be adequate where the licensor justifiably relies on the integrity of the licensee to ensure the consistent quality of the services performed under the mark"); Winnebago Industries, Inc. v. Oliver & Winston, Inc., 207 USPQ 335, 341 (TTAB 1980) (the informal nature of opposer's quality control included the general reputation of the manufacturer). See also Restatement (Third) of Unfair Competition §33, comment c (1995) (trademark owner may rely on the reputation and expertise of the licensee so long as there is no evidence indicating deviations from the agreed standards or procedures).
Case Finding: On the basis of the record, we are persuaded that petitioner is the owner of the JOYCE marks even though respondent has been the only user because there is an implied license between the parties. Our analysis shows that petitioner ultimately controls the nature and quality of the services rendered in connection with the mark.
On the basis of the record, we are persuaded that petitioner is the owner of the JOYCE marks even though respondent has been the only user because there is an implied license between the parties.68 Our analysis shows that petitioner ultimately controls the nature and quality of the services rendered in connection with the mark.
Where a registered mark or a mark sought to be registered is or may be used legitimately by related companies, such use shall inure to the benefit of the registrant or applicant for registration, and shall not affect the validity of such mark or of its registration.
Section 5 of the Trademark Act of 1946, 15 U.S.C. §1055, provides that "[w]here a registered mark or a mark sought to be registered is or may be used legitimately by related companies, such use shall inure to the benefit of the registrant or applicant for registration, and shall not affect the validity of such mark or of its registration."67 FOOTNOTE 67 "The term "related company" is defined as "any person whose use of a mark is controlled by the owner of the mark with respect to the nature and quality of the goods or services on or in connection with which the mark is used." Section 45 of the Trademark Act of 1946, 15 U.S.C. §1127."
Where the license parties have engaged in a close working relationship, and may justifiably rely on each parties' intimacy with standards and procedures to ensure consistent quality, and no actual decline in quality standards is demonstrated, we would depart from the purposes of the law to find an abandonment simply for want of all the inspection and control formalities.
Under these circumstances, we find that petitioner has exercised sufficient control over the nature and quality of the services rendered under the JOYCE marks. Cf Taco Cabana International, Inc. v. Two Pesos Inc., 952 F.2d 1113, 19 USPQ2d 1253, 1259 (5th Cir. 1991), aff'd 505 U.S. 763 (1993) ("Where the license parties have engaged in a close working relationship, and may justifiably rely on each parties' intimacy with standards and procedures to ensure consistent quality, and no actual decline in quality standards is demonstrated,72 we would depart from the purposes of the law to find an abandonment simply for want of all the inspection and control formalities").
Case Finding: We do not interpret petitioner's compliance with the terms under which performers may use the JOYCE marks in the Joyce Theater performance rental agreement as a declaration or concession that respondent is the owner of the JOYCE marks. It is simply an expression that petitioner agreed to perform under the same terms and conditions as other dance companies.
We do not interpret petitioner's compliance with the terms under which performers may use the JOYCE marks in the Joyce Theater performance rental agreement as a declaration or concession that respondent is the owner of the JOYCE marks. It is simply an expression that petitioner agreed to perform under the same terms and conditions as other dance companies.

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