Court Opinion

ID: 9946201
Source: CourtListenerOpinion
Date Created: 2024-02-29 16:02:48.103575+00
Date Added: 2024-06-11T14:25:30.471342
License: Public Domain

Case: 22-1872    Document: 35    Page: 1   Filed: 02/15/2024

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

         NATERRA INTERNATIONAL, INC.,
                   Appellant

                            v.

                  SAMAH BENSALEM,
                         Appellee
                  ______________________

                        2022-1872
                  ______________________

     Appeal from the United States Patent and Trademark
 Office, Trademark Trial and Appeal Board in No.
 92074494.
                  ______________________

                Decided: February 15, 2024
                 ______________________

     JORGE MIGUEL HERNANDEZ, Carstens, Allen, & Gour-
 ley, LLP, Plano, TX, argued for appellant. Also repre-
 sented by DAVID W. CARSTENS.

    JEFFREY STURMAN, Sturman Law LLC, Denver, CO, ar-
 gued for appellee.
                  ______________________

   Before MOORE, Chief Judge, STOLL and CUNNINGHAM,
                    Circuit Judges.
 CUNNINGHAM, Circuit Judge.
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 2                 NATERRA INTERNATIONAL, INC. v. BENSALEM

     Naterra International, Inc. (“Naterra”) appeals from a
 decision of the Trademark Trial and Appeal Board
 (“Board”) denying Naterra’s petition for cancellation of Sa-
 mah Bensalem’s BABIES’ MAGIC TEA standard character
 mark registration. Naterra Int’l, Inc. v. Samah Bensalem,
 No. 92074494, 2022 WL 1237887, at *1, *21 (T.T.A.B. Apr.
 4, 2022) (“Decision”). Naterra challenges the Board’s con-
 clusion that there was no likelihood of confusion between
 Naterra’s BABY MAGIC mark and Bensalem’s BABIES’
 MAGIC TEA mark. For the reasons below, we vacate the
 Board’s denial of Naterra’s cancellation petition and re-
 mand for further proceedings.
                      I.   BACKGROUND
      Bensalem owns the registration for the standard char-
 acter mark BABIES’ MAGIC TEA for “medicated tea for
 babies that treats colic and gas and helps babies sleep bet-
 ter.”   Decision at *1; J.A. 48 (Trademark Reg. No.
 4,771,300). Naterra owns four registrations for the stand-
 ard character mark BABY MAGIC covering numerous toi-
 letry goods. 1 See Decision at *1. In June 2020, Naterra
 filed a Petition for Cancellation alleging that the use of
 Bensalem’s BABIES’ MAGIC TEA mark in connection with
 Bensalem’s goods would likely “cause confusion, mistake,

     1  See J.A. 50 (Trademark Reg. No. 1,228,079) (body
 powder, body oil, and skin cleanser); J.A. 51 (Trademark
 Reg. No. 1,055,375) (hair shampoo); J.A. 52–54 (Trade-
 mark Reg. No. 580,657) (skin lotion); J.A. 55 (Trademark
 Reg. No. 3,890,083) (baby hair conditioner; baby lotion;
 baby oil; baby powder; baby shampoo; baby wipes; bath
 soaps in liquid, solid, or gel form; bubble bath; cologne;
 laundry detergent; non-medicated bath preparations; non-
 medicated diaper rash cream; non-medicated diaper rash
 ointments and lotions; skin cleansers; skin conditioners;
 and sunscreen); see also Decision at *4 (finding Naterra’s
 “pleaded registrations are valid and owned by [Naterra]”).
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 NATERRA INTERNATIONAL, INC. v. BENSALEM                      3

 or deception,” and is therefore in violation of Section 2(d) of
 the Lanham Act. J.A. 65 ¶ 31; see also Decision at *1; J.A.
 56–58, 63–65.
      The Board denied Naterra’s petition because Naterra
 failed to prove a likelihood of confusion. Decision at *21.
 The Board conducted its likelihood of confusion analysis
 under the factors set forth in In re E.I. DuPont DeNemours
 & Co., 476 F.2d 1357, 1361 (CCPA 1973) (“the DuPont fac-
 tors”). 2 Decision at *6. First, the Board found Naterra
 “fail[ed] to carry [its] burden to clearly show [ ]that its
 BABY MAGIC mark is commercially strong, let alone fa-
 mous” and the mark therefore “f[ell] somewhere in the mid-
 dle of the fame spectrum” for DuPont factor five. Id. at *12;
 see also id. at *7–11. The Board found DuPont factor six to
 be neutral, and thus concluded that the BABY MAGIC
 mark is entitled to “the normal scope of protection to which
 inherently distinctive marks are entitled.” Id. at *12 (in-
 ternal quotation marks omitted). The Board also con-
 cluded that DuPont factor one favored finding likelihood of
 confusion because the marks were “more similar than

     2   “The thirteen factors are as follows: (1) similarity
 of the marks; (2) similarity and nature of goods described
 in the marks’ registrations; (3) similarity of established
 trade channels; (4) conditions of purchasing; (5) fame of the
 prior mark; (6) number and nature of similar marks in use
 on similar goods; (7) nature and extent of actual confusion;
 (8) length of time and conditions of concurrent use without
 evidence of actual confusion; (9) variety of goods on which
 mark is used; (10) market interface between applicant and
 owner of a prior mark; (11) extent to which applicant has a
 right to exclude others from use of its mark; (12) extent of
 potential confusion; and (13) any other established proba-
 tive fact on effect of use.” Zheng Cai v. Diamond Hong,
 Inc., 901 F.3d 1367, 1371 n.2 (Fed. Cir. 2018) (citing
 DuPont, 476 F.2d at 1361).
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 4                 NATERRA INTERNATIONAL, INC. v. BENSALEM

 dissimilar as to appearance, sound, connotation and com-
 mercial impression.” Id. at *15; see also id. at *12–14. The
 Board also found that DuPont factors two (similarity and
 nature of goods) and three (similarity of established trade
 channels) weighed against a finding of likelihood of confu-
 sion, concluding that Naterra had “failed to demonstrate
 that the parties’ respective goods are related in any man-
 ner, or that they travel within the same trade channels to
 the same class of purchasers.” Id. at *19; see also id. at
 *15–18. Lastly, the Board found that DuPont factors four,
 eight, ten, and twelve were neutral. Id. at *19–20.
     In weighing the relevant DuPont factors, the Board
 gave “particular weight” to the lack of “probative evidence
 showing the relatedness of the parties’ respective
 goods, . . . coupled with the somewhat weak inherent na-
 ture of [Naterra’s] BABY MAGIC mark, [and] the lack of
 demonstrated commercial strength (let alone fame) and
 similar trade channels.” Id. at *21. After weighing the
 pertinent DuPont factors, the Board found Naterra failed
 to prove a likelihood of confusion. See id.
     Naterra appeals. We have jurisdiction under 28 U.S.C.
 § 1295(a)(4)(B).
                   II. Standard of Review
      Section 2(d) of the Lanham Act provides the registra-
 tion of a mark may be refused if it is “likely, when used on
 or in connection with the goods of the applicant, to cause
 confusion” with another registered mark. 15 U.S.C.
 § 1052(d); see QuikTrip W., Inc. v. Weigel Stores, Inc., 984
 F.3d 1031, 1034 (Fed. Cir. 2021). “Likelihood of confusion
 is a question of law based on underlying factual findings
 regarding the DuPont factors.” Spireon, Inc. v. Flex Ltd.,
 71 F.4th 1355, 1362 (Fed. Cir. 2023) (citing In re i.am.sym-
 bolic, llc, 866 F.3d 1315, 1322 (Fed. Cir. 2017)). “We review
 the Board’s factual findings on each relevant DuPont factor
 for substantial evidence, but we review the Board’s weigh-
 ing of the DuPont factors de novo.” QuikTrip, 984 F.3d at
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 NATERRA INTERNATIONAL, INC. v. BENSALEM                    5

 1034. “Substantial evidence is such relevant evidence as a
 reasonable mind would accept as adequate to support a
 conclusion.” Zheng Cai, 901 F.3d at 1371 (internal quota-
 tion marks omitted). “Not all of the DuPont factors are nec-
 essarily relevant or of equal weight in a given case, and any
 one of the factors may control a particular case.” Tiger Lily
 Ventures Ltd. v. Barclays Cap. Inc., 35 F.4th 1352, 1362
 (Fed. Cir. 2022) (internal quotation marks omitted). “Only
 the DuPont factors of significance to the particular mark
 need be considered in the likelihood of confusion analysis.”
 Id. (internal quotation marks omitted).
                       III. DISCUSSION
      Naterra raises two issues on appeal. First, Naterra
 contends that substantial evidence does not support the
 Board’s finding that the similarity and nature of the goods
 (DuPont factor two) and trade channels (DuPont factor
 three) disfavor a likelihood of confusion. Appellant’s Br.
 13, 17; see also id. at 14–16, 18. Second, Naterra argues
 that the Board erred by failing to give greater weight to the
 similarity of the marks (DuPont factor one) and the fame
 of the BABY MAGIC mark (DuPont factor five) in its over-
 all likelihood of confusion analysis. Id. at 10–13. We ad-
 dress each issue in turn.
                              A.
    We first turn to Naterra’s arguments regarding
 DuPont factors two and three. See id. at 13, 17.
                              i.
     The second DuPont factor “considers whether the con-
 suming public may perceive the respective goods and ser-
 vices of the parties as related enough to cause confusion
 about the source or origin of the goods and services.” In re
 St. Helena Hosp., 774 F.3d 747, 752 (Fed. Cir. 2014)
 (cleaned up) (citation omitted). Naterra argues that the
 Board failed to consider pertinent evidence indicating that
 several companies sell baby ingestible products and baby
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 6                 NATERRA INTERNATIONAL, INC. v. BENSALEM

 skin care products under the same mark in concluding that
 the parties’ goods were not related. Appellant’s Br. 13–15.
     In reaching the conclusion that the goods are not re-
 lated, the Board rejected Naterra’s theory of relatedness
 known as “umbrella branding” and “natural zones of ex-
 pansion.” Decision at *16–18. In the context of discussing
 the issue of natural expansion, the Board stated that Na-
 terra’s expert “provided several examples of other umbrella
 baby brand companies that purportedly provide certain
 products in both the baby skincare product category and
 the baby ingestible product category.” Id. at *17 (cleaned
 up). The Board rejected this expert testimony as “unsup-
 ported by underlying evidence.” Id.
      However, testimony that third-party companies sell
 both types of goods is pertinent to the relatedness of the
 goods. See Recot, Inc. v. Becton, 214 F.3d 1322, 1328–29
 (Fed. Cir. 2000) (finding the Board erred in declining to
 consider lay evidence that several companies sell both pet
 and human food products). Furthermore, Bensalem’s coun-
 sel admitted at oral argument that the third-party evi-
 dence is “absolutely very relevant.” Oral Arg. at 15:55–
 16:16,          https://oralarguments.cafc.uscourts.gov/de-
 fault.aspx?fl=22-1872_06062023.mp3. We cannot discern
 if the Board also considered and rejected this testimony
 outside its discussion of the issue of natural expansion.
 See, e.g., Packard Press, Inc. v. Hewlett-Packard Co., 227
 F.3d 1352, 1358 (Fed. Cir. 2000) (vacating and remanding
 because the court could not “discern from the Board’s brief
 discussion” whether the Board applied the wrong test); De-
 cision at *18 (noting an “absence of evidence showing that
 other companies in [Naterra’s] industry also sell medicated
 teas”); J.A. 134 ¶¶ 13–17. Because we cannot discern
 whether the relevant evidence was properly evaluated, we
 remand to the Board for further consideration and expla-
 nation of its analysis under this factor.
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 NATERRA INTERNATIONAL, INC. v. BENSALEM                     7

     At oral argument, Bensalem’s counsel also argued that
 the Board’s conclusion on this factor at most constitutes
 harmless error. See Oral Arg. at 10:12–50. This argument
 was raised for the first time at oral argument and is thus
 forfeited. See SEKRI, Inc. v. United States, 34 F.4th 1063,
 1071 n.9 (Fed. Cir. 2022). Additionally, even if we were to
 consider the merits of Bensalem’s argument, we find the
 argument unpersuasive. The Board relied on the rejection
 of the third-party evidence in finding no relatedness. See
 Decision at *16, *18. Among other things, the Board fur-
 ther found the fact that “this case is devoid of probative ev-
 idence showing the relatedness of the parties’ respective
 goods” “carrie[d] particular weight” in arriving at the con-
 clusion that Naterra failed to prove a likelihood of confu-
 sion. Id. at *21. Because the Board might reach “an
 answer to the overall likelihood-of-confusion question dif-
 ferent from the answer the Board gave in the decision on
 review,” the error is not harmless. See Juice Generation
 Inc. v. GS Enters. LLC, 794 F.3d 1334, 1341 (Fed. Cir.
 2015).
                              ii.
     The third DuPont factor considers “[t]he similarity or
 dissimilarity of established, likely-to-continue trade chan-
 nels.” In re Detroit Athletic Co., 903 F.3d 1297, 1308 (Fed.
 Cir. 2018) (quoting DuPont, 476 F.2d at 1361). Naterra ar-
 gues that the Board’s finding on the third factor is not sup-
 ported by substantial evidence because it ignored
 Bensalem’s admission that the parties’ goods are sold in
 similar trade channels. Appellant’s Br. 17–18; J.A. 109 ¶ 7.
 We agree.
     The Board addressed some but not all of the evidence
 relevant to the third DuPont factor. For example, the
 Board found there to be “no dispute that the classes of cus-
 tomers for both parties’ areas of business are the same or
 overlapping (i.e., parents and caregivers).” Decision at *18.
 The Board also considered evidence that the parties’ goods
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 8                 NATERRA INTERNATIONAL, INC. v. BENSALEM

 were offered together online by Walmart and Amazon, J.A.
 119–21 ¶¶ 15–16, but ultimately found the third factor to
 weigh against a finding of likelihood of confusion, indicat-
 ing that “[w]ithout more persuasive evidence, we cannot
 conclude that the trade channels are the same in this case.”
 Decision at *18–19.
      However, the Board failed to address Bensalem’s re-
 sponse to the request for admission, admitting that both
 parties “utilize similar channels of trade in connection with
 the trademarks.” J.A. 109 ¶ 7. This request for admission
 is relevant to the inquiry under the third factor. Moreover,
 the Board did not identify in its decision any evidence
 showing a lack of similarity in trade channels. Decision at
 *18–19; Appellee’s Br. 30–31; Oral Arg. at 12:27–53. Ac-
 cordingly, a reasonable mind could not accept the available
 evidence as adequate to support the Board’s finding that
 the third DuPont factor weighs against a finding of likeli-
 hood of confusion. See Zheng Cai, 901 F.3d at 1371.
      For the first time at oral argument, Bensalem’s counsel
 similarly contends that the Board’s finding with respect to
 the third DuPont factor is at most harmless error. See Oral
 Arg. at 12:56–13:33. We again find this argument for-
 feited. Even if we consider this argument on the merits, it
 fails. The Board relied on the lack of similar trade chan-
 nels in finding Naterra failed to prove a likelihood of con-
 fusion. Decision at *21. Because the Board might reach
 “an answer to the overall likelihood-of-confusion question
 different from the answer the Board gave” if it considered
 the admission regarding the trade channels, the error is
 not harmless. See Juice Generation, 794 F.3d at 1341.
    Accordingly, we vacate the Board’s decision and re-
 mand for further proceedings. On remand, the Board
 should consider all the relevant evidence related to the sec-
 ond and third DuPont factors.
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                              B.
     Naterra additionally argues that the Board incorrectly
 weighed DuPont factors one and five in its likelihood of con-
 fusion analysis. See Appellant’s Br. 10–13. We address
 each factor in turn.
                               i.
      Regarding the first DuPont factor, Naterra does not
 dispute the Board’s finding that the BABY MAGIC and
 BABIES’ MAGIC TEA marks were “more similar than dis-
 similar as to appearance, sound, connotation and commer-
 cial impression.” Decision at *15; see Oral Arg. at 5:43–51
 (Naterra conceding to “hav[ing] no issue with the Board’s
 factfinding”). Rather, Naterra contends that the Board
 erred in its weighing of this factor, arguing that it
 “should—at a minimum—weigh heavily in favor of finding
 a likelihood of confusion if not be dispositive in the analy-
 sis.” Appellant’s Br. 12; see also id. at 10–11. We find Na-
 terra’s argument to be persuasive.
     The Board erred in failing to weigh the first DuPont
 factor heavily in favor of a likelihood of confusion finding.
 Decision at *21. This court’s holding in Detroit Athletic is
 instructive, where we found that similarity of the marks
 “weighs heavily in the confusion analysis” because the
 Board found that the marks’ “lead words are their domi-
 nant portion and are likely to make the greatest impression
 on consumers.” 903 F.3d at 1303–04. While the words
 “Co.” and “Club” technically differentiated the marks, the
 court found those words were merely descriptive and “un-
 likely to change the overall commercial impression engen-
 dered by the marks.” Id. at 1304. Similarly, here, the
 Board found that “the first two words of [the] BABIES’
 MAGIC mark and the entirety of [the] BABY MAGIC mark
 look and sound almost the same and have the same conno-
 tation and commercial impression.” Decision at *13. More-
 over, just like in Detroit Athletic, the Board here found that
 TEA is “a generic term” having “no source-identifying
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 10                NATERRA INTERNATIONAL, INC. v. BENSALEM

 significance” and “is the ultimate in descriptiveness.” Id.
 at *14 (citation omitted). Accordingly, the first DuPont fac-
 tor should “weigh[] heavily in the confusion analysis.” De-
 troit Athletic, 903 F.3d at 1303–04. The Board here erred
 in concluding otherwise.

      We decline to address Naterra’s additional argument
 that this first factor is dispositive. Because we also vacate
 the Board’s decision in light of the errors with respect to
 the analysis of the second and third DuPont factors, we re-
 mand to the Board to address this argument after consid-
 ering all the relevant DuPont factors. See Hewlett-Packard
 Co. v. Packard Press, Inc., 281 F.3d 1261, 1265 (Fed. Cir.
 2002) (explaining the likelihood of confusion analysis “con-
 siders all DuPont factors for which there is evidence of rec-
 ord” but may focus on dispositive factors); In re Guild
 Mortgage Co., 912 F.3d 1376, 1381 (Fed. Cir. 2019) (vacat-
 ing the Board’s decision and remanding for the Board to
 reconsider one of the DuPont factors and “to reconsider its
 likelihood of confusion determination in the first instance
 in light of all the evidence”).
                              ii.
      Lastly, we address Naterra’s argument relating to the
 fifth DuPont factor, fame. See Appellant’s Br. 12–13. On
 this factor, the Board found there to be no evidence regard-
 ing “sales or advertising expenditures in connection with
 [Naterra’s] trademark;” no evidence regarding “critical as-
 sessments or notice by independent sources of the products
 identified by the mark;” and no evidence regarding “gen-
 eral reputation of [Naterra’s] BABY MAGIC mark.” Deci-
 sion at *10. The Board also rejected Naterra’s Executive
 President’s testimony as self-serving and “unsupported by
 any corroborating evidence.” Id. at *10–11. Lastly, the
 Board found Naterra’s foreign registrations “d[id] not aid
 [the] determination” on fame in the United States. Id. at
 *12. Therefore, the Board did not find the BABY MAGIC
 mark “commercially strong, let alone famous,” and instead
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 NATERRA INTERNATIONAL, INC. v. BENSALEM                  11

 found the mark “somewhat conceptually weak” and that it
 “falls somewhere in the middle of the fame spectrum.” Id.
 at *9, *12 (emphasis added).
      On appeal, Naterra does not challenge the Board’s fact-
 finding on this factor. See Oral Arg. at 5:43–51. Instead,
 Naterra argues that the Board erred as a matter of law in
 failing to give greater weight to fame in its likelihood of
 confusion analysis. Appellant’s Br. 12–13. We disagree.
 Naterra relies on Recot to argue that when present, fame
 “plays a dominant role” in the likelihood of confusion anal-
 ysis. See id. But Recot is inapposite because in that case
 the mark’s fame was “unquestionably established.” 214
 F.3d at 1327. Here, fame was not unquestionably estab-
 lished. See Decision at *12. Therefore, the Board did not
 err in failing to give fame a dominant role in the overall
 likelihood of confusion analysis. Recot, 214 F.3d at 1327.
                      IV. CONCLUSION
     We have considered Naterra’s remaining arguments
 and find them unpersuasive. We conclude the Board erred
 in weighing the first DuPont factor and failed to address
 relevant evidence concerning the third DuPont factor. We
 also cannot discern whether the Board properly addressed
 relevant evidence concerning the second DuPont factor.
 Accordingly, we vacate the Board’s decision and remand for
 further proceedings consistent with this opinion.
                VACATED AND REMANDED
                           COSTS
 Costs awarded to appellant.