Court Opinion

ID: 9471638
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:37:30.468916+00
Date Added: 2024-06-11T17:42:30.545288
License: Public Domain

VANCE, Circuit Judge,
dissenting:
I cannot agree that Citibank’s claim of trademark infringement is meritorious. In my view, it fails for three reasons. First, the circumstances surrounding the 1959 registration application and Citibank’s subsequent litigation campaign suggest a strong possibility of fraud. Wholly apart from that, “Citibank” is too weak a mark to merit trademark protection. Finally, our decision in Sun Banks of Florida, Inc. v. Sun Federal Savings & Loan Association, 651 F.2d 311 (5th Cir.1981), compels us to find that there is no likelihood of confusion in this case, and hence, no trademark infringement.
A brief review of the facts is in order with respect to the claim of fraud. In 1959, plaintiff filed for federal registration of the servicemark “Citibank.”1 In its papers, Citibank stated that it first made interstate use of that mark in connection with banking services in 1959. Citibank also appended an affidavit signed by one of its vice presidents declaring that “to the best of his knowledge and belief no other person, firm, corporation or association has the right to use said mark in commerce, either in the identical form or in such near resemblance thereto as might be calculated to deceive.” The application listed certain registration numbers which the bank already owned. The Patent and Trademark Office gave its approval and awarded registration in 1960.
On the basis of these facts, the district court specifically found that Citibank “did not advise the Patent and Trademark office of any third party users of ‘City Bank’ in its 1959 federal application ...”2 Despite its earlier claim that it knew of no confusingly similar marks, however, Citibank subsequently instituted eleven trademark infringement suits against users of “City Bank,” “Citibank” and “Citibane,” alleging that these marks created a likelihood of confusion. It threatened another eight banks with suit. Citibank predicated these actions on its supposed rights as the senior user of “City Bank,” dating from 1812 and set forth in its 1949 and 1950 registration applications for the servicemark “The National City Bank of New York.”
This turn of events strongly suggests that Citibank’s original denial of the existence of similar marks was an attempt to conceal the derivation of its mark in order to improve its chances of registration. Un*1549der the Lanham Act, 15 U.S.C. § 1051 et seq., generic terms and descriptive terms that lack secondary meaning cannot qualify for federal registration. Id. § 1052(e)(1), (f); Soweco, Inc. v. Shell Oil Co., 617 F.2d 1178, 1183 (5th Cir.1980), cert denied, 450 U.S. 981, 101 S.Ct. 1516, 67 L.Ed.2d 816 (1981). Had plaintiff explicitly traced the derivation of “Citibank” to the use of “City Bank,” it would have courted outright rejection of its application on the ground that its mark was generic or merely descriptive, as I shall discuss below.3
Citibank had good reason to conceal the lineage of its mark in an effort to ensure approval of its application. An incontestable registration allows the owner to assert its mark nationwide, free of all but the common-law defenses enumerated in the Lanham Act.4 In particular, incontestability bars the defense that the mark is a descriptive term that lacks secondary meaning. Soweco, 617 F.2d at 1184-85. With registration, Citibank thus succeeded in bootstrapping its mark from “descriptive” to “suggestive” status. It then proceeded to exploit its newly-gained advantages by filing a battery of lawsuits in which it asserted rights based on its claim to the senior use of “City Bank.” Obviously, if Citibank had indicated on its original application in 1959 that it considered the new mark the functional equivalent of “City Bank,” the Patent and Trademark Office would have denied approval on the grounds that the mark was generic or at best descriptive. Citibank’s apparently selective ignorance of the existence of rival users permitted it to outflank this obstacle.
In the majority’s view, no fraud arose because Citibank, as the senior user of “City Bank,” had no duty under 15 U.S.C. § 1052(d) to disclose the possibility of confusion with other “City Banks.” Rosso & Mastrocco, Inc. v. Giant Foods, Inc., 720 F.2d 1263 (Fed.Cir.1983); The Money Store v. Harriscorp Finance, Inc., 689 F.2d 666, 670-71 (7th Cir.1982). This mistakes the object of the alleged fraud. Citibank had no motive to conceal the starting date of use, since even a colorable claim of senior use would obviate a charge of fraud in the registration. 1 J. McCarthy, Trademarks and Unfair Competition § 20:23, at 814 (1973); 2 J. McCarthy, § 31:21, at 411; see also, e.g., Haviland & Co. v. Johann Haviland China Corp., 269 F.Supp. 928, 936-37 (S.D.N.Y.1967). It did have reason, however, to conceal the generic or descriptive origin of its mark.
When a registrant asserts senior use in circumstances such as these portending an intent to deceive, the way is laid for a conclusion of fraud. Haviland & Co., 269 F.Supp. at 937; cf. King Automotive, Inc. v. Speedy Muffler King, Inc., 667 F.2d 1008, 1011 n. 4 (C.C.P.A.1981) (intent to deceive *1550necessary before silence regarding third-party use can constitute Lanham Act fraud); King-Size, Inc. v. Frank’s King Size Clothes, Inc., 547 F.Supp. 1138, 1166 (S.D. Tex.1982) (same). In the event of fraud, Citibank’s registration would not warrant protection from infringement and would be subject to cancellation. 15 U.S.C. § 1115(b)(1). If Citibank were innocent, it would presumably be willing to test the strength of its mark as of 1959 against the stricter common law standards that govern contestable marks. Citibank has made no such offer.
My second point of disagreement proceeds from the first. The majority, in a conclusory fashion, characterizes the terms “City Bank” and “Citibank” as suggestive marks. This determination rests on the erroneous assumption that the traditional trademark classifications are self-contained categories that do not overlap. The case law of this circuit counsels otherwise. We have observed that trademark categories, which “tend to merge imperceptibly from one to another,” are “quite frequently, difficult to apply,” Vision Center v. Opticks, Inc., 596 F.2d 111, 115 (5th Cir.1979), cert. denied, 444 U.S. 1016, 100 S.Ct. 668, 62 L.Ed.2d 646 (1980); see also Soweco, 617 F.2d at 1182-83.
This case provides a particularly apt illustration of our admonition. The term “City Bank” obscures the traditional distinction between servicemarks and names unworthy of protection by describing the location of both bankers and the services they provide.5 See Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 118, 59 S.Ct. 109, 113, 83 L.Ed. 73 (1938). The proper characterization of “City Bank” is far more elusive than the majority would have it appear. While the words “City Bank” evoke the financial acumen and innovation long associated with urban banking centers, characteristic of a suggestive mark, they also describe a bank located in a city, characteristic of a descriptive or generic mark.6
Given the conceptual failure of the traditional categories in the context of this case, it may be useful for us to instead focus on the ends which trademark law serves. Two considerations underlie the determination that the law will only protect marks that identify one merchant’s services and distinguish them from another. A mark must be distinctive in order for consumers to identify the merchant who merits their confidence. By the same token, words which describe a class of providers as opposed to specific individuals are names that should remain in the public domain so that all may use them. Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 1976); 1 McCarthy, supra, § 12:2, at 406.
Both considerations cause me to conclude that “City Bank” is a generic term which cannot receive trademark protection. “City Bank,” like “town barber shop,” denotes a class of businesses. As a result, this term is peculiarly incapable of pinpointing any particular town’s “City Bank” as unique. Likewise, it is difficult to dispute that “City Bank,” like “corner grocery,” belongs in the *1551public domain. Innumerable “City Cleaners” and “City Florists” line the pages of metropolitan telephone directories. Indeed, in 1959 over 200 banks used “City” and “Bank” in their tradenames, with 70 using the words in consecutive order. It would be absurd at this late date to bar all banks save one from using this time-honored name. See First Southern Federal Savings & Loan Association v. First Southern Savings & Loan Association, 614 F.2d 71, 74 (5th Cir.1980) (“First Southern,” as a combination of a generic and geographic term, held unprotectable as a bank name); Surf Club v. Tatem Surf Club, Inc., 151 Fla. 406, 10 So.2d 554, 557 (1942) (holding “Surf Club” a generic name for any club located on a beach).
The phonetic equivalent “Citibank” is too minor a deviation from “City Bank” to warrant protection where otherwise none would issue. See, e.g., Surgicenters of America, Inc. v. Medical Dental Surgeries, 601 F.2d 1011, 1018 (9th Cir.1979) (“Surgicenter” equivalent to the generic term surgical center); Miller Brewing Co. v. G. Heileman Brewing Co., 561 F.2d 75, 81 (7th Cir.1977), cert. denied, 434 U.S. 1025, 98 S.Ct. 751, 54 L.Ed.2d 772 (1978) (“Lite” a generic term for light beer); Cummins Engine Co. v. Continental Motors Corp., 359 F.2d 892, 894-95, 53 C.C.P.A. 1167 (1966) (“Turbodiesel” a generic name for diesel engines having exhaust-driven superchargers); Weiss Noodle Co. v. Golden Cracknel & Specialty Co., 290 F.2d 845, 847, 48 C.C.P.A. 1004 (1961) (“Ha-Lush-Ka” a generic name for haluska, the Hungarian word for egg noodle); American Druggists’ Syndicate v. United States Industrial Alcohol Co., 2 F.2d 942, 943 (D.C.Cir.1924) (“Al-kol” a generic name for rubbing alcohol). As a generic term, “Citibank” cannot qualify for protection either under the Lanham Act, 15 U.S.C. §§ 1052(e)(1), 1064(c),7 or at common law. Miller Brewing Co. v. Falstaff Brewing Corp., 655 F.2d 5, 7 (1st Cir.1981); Reese Publishing Co. v. Hampton International Communications, Inc., 620 F.2d 7, 12 (2d Cir.1980).
Even assuming that the majority correctly classifies “Citibank” as a suggestive mark, I fail to see how a likelihood of confusion exists here where none existed in Sun Banks of Florida, Inc. v. Sun Federal Savings & Loan Association, 651 F.2d 311 (5th Cir.1981). In that case we concluded that “Sun Bank,” although arbitrary, was a weak mark due to extensive third party use. This weakness outweighed any confusion created by the identity of services, customers and types of advertising media used. Id. at 318-19.
The court below held that “Citibank” is even weaker than the fatally weak “Sun Bank” mark. Since the weakness of the mark required reversal in Sun Banks, I see no choice but to order it here. The fact that we have traditionally tolerated a greater degree of resemblance among the names of financial institutions only reinforces this conclusion. See, e.g., Sun Banks, 651 F.2d 311 (5th Cir.1981); First Southern Federal Savings & Loan Association, 614 F.2d 71 (5th Cir.1980); Fidelity Bond & Mortgage Co. v. Fidelity Bond & Mortgage Co. of Texas, 37 F.2d 99 (5th Cir.1930).
The majority explains away Sun Banks by noting that “Citibank,” while weak, is more nearly similar to “Citibanc of Alabama/(name of town)” than “Sun Bank” was to “Sun Federal Savings & Loan.” In so holding, the majority incorrectly gives the element of similarity double weight in balancing the Sun Banks factors. The similarity of the mark is a separate factor in the Sun Banks analysis which should not be used to resolve any other factor such as the strength of the mark. Having committed this error, the majority then compounds it by allowing the district court to resolve the question of good faith in Citibank’s favor on the basis of the similarity in names even though there is no evidence of bad faith.8
*1552In sum, I would hold that Citibank’s apparent fraud, the weakness of its mark, and the absence of confusion compels reversal.

. Plaintiff applied under its then current name of “The First National City Bank of New York.” To avoid confusion, I shall refer to plaintiff simply as “Citibank.”

. The court below went on to observe that the defendants also failed to reveal the existence of other users in their recent Alabama applications even though there are other banks in Alabama which use “City Bank” in their names. Plaintiff does not complain, however, that defendant has commenced suit against other third party users predicated on a senior use of the term “City Bank.”

. Citibank asserts that the list of registration numbers it already owned provided notice of potential senior use. According to Citibank, these references directed the Patent and Trademark Office to files that traced the lineage of “City Bank.” This is an implausible reading of the case law concerning notice. A litany of registration numbers in and of itself cannot provide notice. The Patent Office’s search of “Citibank” did not reveal third party users of “City Bank.” Cf. American Sec. Bank v. American Sec. & Trust Co., 571 F.2d 564, 567 (C.C.P. A. 1978) (reaching the opposite outcome because a search of “American Security” would lead to third party users of “American Security Bank”); see Kinark Corp. v. Camelot, Inc., 548 F.Supp. 429, 442 (D.N.J.1982).

. Rights of incontestability attach after the mark has been in continuous use for five years following registration. 15 U.S.C. § 1065. Federal registration then confers “the right to preempt all junior users in the nation once the registrant [proves it is likely to expand] into a remote area.” 2 J. McCarthy, Trademarks and Unfair Competition, § 26:13, at 229 (1973); see American Foods, Inc. v. Golden Flake, Inc., 312 F.2d 619, 625-26 (5th Cir.1963).
Once the five-year threshold is satisfied, the Lanham Act eliminates the common-law defenses of good faith and lack of knowledge. 15 U.S.C. § 1072; American Foods, 312 F.2d at 626-27. No other common-law defenses can be asserted against the registrant except those enumerated in 15 U.S.C. § 1115(b). id. § 1065. Professor McCarthy has noted,
[I]t is clear that the attainment of incontestability vastly butresses [sic] the legal position of a trademark. Once it becomes incontestable, a registered mark can be legally attacked or defended against, only on a few specifically enumerated grounds. Other than those specific defenses, the registered mark is invulnerable.
1 McCarthy, supra, § 19:47, at 742.

. In Vision Center, we held that the term “Vision Center” was “descriptive of the service provided by a business that deals in optical goods.” 596 F.2d at 117. Certainly “City Bank” is no less descriptive of services.

. For the same reason, the restrictive rules governing geographic names come into play. Traditionally courts treat geographic terms as at best descriptive marks, which require proof of secondary meaning. 1 McCarthy, supra, § 14:1, at 483. Where the historical use of a geographic term is so closely associated with a type of service that it identifies it, the term is generic. Id. at 14:8, at 503. These rules exist to preserve for every seller the right to tell customers the geographical origin of its products. Id. § 14:1, at 484.
“City Bank,” unlike most unenforceable geographical terms, refers to a geographical unit with no determined location. We have held that “World,” as applied to carpets, is not a geographical term for purposes of the Lanham Act. World Carpets, Inc. v. Dick Littrell’s New World Carpets, 438 F.2d 482, 486-87 (5th Cir. 1971). We reached this conclusion because “World” neither suggested a specific place of origin nor described the nature of the product. Id. Because “City Bank” by contrast describes the setting in which bank services are conducted, it is a geographical term unentitled to trademark protection. See Surf Club v. Tatem Surf Club, Inc., 10 So.2d at 557.

. The incontestability provisions of the Lanham Act, 15 U.S.C. § 1065, do not bar the defense that the mark is generic. Cancellation of a generic mark may also lie. 15 U.S.C. § 1119; 1 McCarthy, supra, § 12; 18, at 441-42.

. I also believe that the district court erred in failing to weigh the factor “identity of service facilities and customers” in favor of defendant. The trial court gave this factor little or no weight. The factor clearly favors Citibanc since Citibank is not chartered to conduct *1552banking business in the state of Alabama and is not likely to be so licensed at any time in the future. The court below furthermore found that the two banks have no customers in common. This disparity is likely to continue since plaintiff serves large business concerns or wealthy investors unlike the rural businesses and individuals of modest means who bank with defendant.