Court Opinion

ID: 8907131
Source: CourtListenerOpinion
Date Created: 2022-11-27 01:58:37.352208+00
Date Added: 2024-06-11T17:08:17.575389
License: Public Domain

MILLER, Judge, with whom BALDWIN, Judge,
joins, dissenting.
The majority sets forth, for the first time, an interpretation of section 18 of the Lanham Act (15 U.S.C. § 1068) (“Act”) which not only is contrary to the previous interpretation by this court and respected commentators, but also is in fundamental conflict with two of the basic purposes of the Act. Moreover, in concluding that appellant-junior user-registrant is not entitled to maintain any registration, the majority assumes a legal conclusion which the board did not make, namely: that confusion would be likely even if the registration were territorially restricted.
This appears to be the first case in which a majority of the CCPA has premised a decision on its determination of which of the powers enumerated in section 18 of the Act is exercisable by the Commissioner in which of the proceedings enumerated in section 17.1 The majority concludes that “the most reasonable construction of § 18 is that the Commissioner may or may not cancel, that is, entirely eliminate, a subsisting registration in a cancellation proceeding instituted under § 14 and that the Commissioner may or may not restrict a subsisting registration involved in a concurrent use proceeding instituted under § 2(d).” However, this by no means is the most reasonable interpretation of the statute, and the one Judge Baldwin and I believe to be correct better effectuates the purposes of the Act.
A major problem in construing sections 17 and 18 arises because of the lack of correspondence between the proceedings enumerated in section 17 and the powers *83given the Commissioner in section 18. The majority attempts to solve the problem by harmonizing five different sections of the Act (2(d), 14, 16, 17 and 18), asserting that these sections are in pari materia and, therefore, “are to be construed together.” However, it disdains including section 37 in the harmonization, suggesting instead that the provision in that section for “cancellation ... in whole or in part” must be regarded as “another example of the differences between the proceedings in the PTO and in the courts . . . or as imprecise drafting.” Contrary to this gratuitous assumption, in section 37 the drafters gave the district court authority to order partial cancellation of a registered mark, just as in section 18 they gave the Commissioner authority to “restrict the registration of a registered mark.” Writers commenting on an early version of the Lanham Bill2 prophetically wrote:
Sections 18 and 19 of the Bill[3] are ambiguous in several respects and will require judicial review before their meaning can possibly become settled. . The lack of any correspondence between the language of sections 18 and 19 of the Lanham Bill makes it impossible to determine with any certainty whether the Commissioner has been given jurisdiction to cancel [4] a registered mark involved in an interference, or whether the jurisdiction to cancel a registration is limited to cancellation proceedings. Because of the close similarity of the issues in interferences and cancellation proceedings, there is no sound reason why the power to cancel a registered mark involved in an interference should not be conferred upon the Patent Office. The granting of such power may have been intended when Section 19 of the Lanham Bill was written, but it is not possible to find any clear expression of such a purpose in the Bill, or any sound reason for holding to the contrary.
Not only is the Act itself ambiguous regarding which remedies are available in which proceedings, but numerous House and Senate reports accompanying the various versions of the bill and the voluminous testimony taken over a period of many years provide no indication of the intent behind sections 17 and 18. That intent must be divined by construing the sections of the Act in the way that best effectuates the stated purposes of the Act.
Commentators on the Act have interpreted section 18 as giving the Commissioner the power to utilize any of the remedies there enumerated in any of the “proceedings” set out in section 17. Daphne Robert, author of the “Commentary on The Lanham Trade-Mark Act,”5 states at page 82 of her book, The New Trade-Mark Manual (1947), that in an interference proceeding—
When the evidence discloses that the second applicant’s rights are superior, the examiner of interferences[6] may cancel the previous registration and grant registration to the second applicant. When it *84discloses that both parties have limited rights, he may grant registration to the second applicant and restrict the territory, manner of use, or the goods or services in both registrations.41 [Emphasis added.]
41 Section 18.
In discussing opposition proceedings, the author writes—
In making his finding, the examiner may refuse to register the mark for which registration is sought, may cancel or restrict the registration of the oppo-ser’s mark, or may register the applicant’s mark and restrict the opposer’s registration. If the examiner decides to grant concurrent registrations, the Commissioner fixes the conditions and limitations of each registration as to the mode or place of use, or the goods or services in connection with which each registration is granted. [Emphasis added.]
Id. at 86-87. Accord, 1 J. McCarthy, Trademarks and Unfair Competition § 20.17D. at 799-800 (1973), where it is said that section 18 of the Act “grants to the Commissioner of Patents the right, in any opposition, cancellation, or interference proceeding, to cancel or restrict the registration of a registered mark.” Pearne & Crotty, supra note 2, have commented on the similarity of issues involved in cancellation and interference proceedings. Indeed, priority of use is an important issue in almost every opposition, cancellation, interference, or concurrent use proceeding. Since the Act groups all of the inter partes proceedings together in section 17, it is reasonable to conclude, as have the above cited commentators, that the Commissioner has the power to exercise any of the powers enumerated in section 18 “as the rights of the parties . . may be established in the proceedings” (“proceedings” referring to all of the proceedings listed in section 17).
Past statements by this court support the above interpretation of sections 17 and 18 over the narrow interpretation of the majority. In Prince Dog & Cat Food Co. v. Central Nebraska Co., 305 F.2d 904, 909, 49 CCPA 1328,1335,134 USPQ 366, 370 (1962), the court declared that section 18 “gives the Commissioner . .. authority to restrict a registration only ‘as the rights of the parties hereunder may be established in the [cancellation] proceedings.’ ” (Bracketed material by the court.) See also Stanspec Co. v. American Chain & Cable Co., 531 F.2d 563, 566 n.9, 189 USPQ 420, 423 n.9 (Cust. & Pat.App.1976), where the court remarked, in the context of a cancellation proceeding, that the “Commissioner has authority to cancel or restrict the registration of a registered mark under section 18”; and my dissenting opinion in Hollowform, Inc. v. Delma AEH, supra.
The majority is unnecessarily preoccupied with the label attached to this inter partes proceeding, i. e., “cancellation.” Paraphrasing what this court stated in Alfred Dunhill of London, Inc. v. Dunhill Clothes, Inc., 293 F.2d 685, 693 n.8, 49 CCPA 730, 741 n.9, 130 USPQ 412, 419 n.8 (1961), it is of no practical significance' that the present inter partes proceeding is called a “cancellation” when the facts are such as to require a decision on an issue of concurrent registration.7 The record establishes that appellant is the prior user of the mark in at least three states and, thus, has limited use rights in the mark.8
*85The majority clearly errs in concluding that concurrent user rights can be determined only in a concurrent use proceeding; the Act is not so written. Section 2(d) states that “concurrent registrations may be issued to such persons when they have become entitled to use such marks as a result of their concurrent lawful use in commerce,” a condition obviously embraced by the phrase, “as the rights of the parties hereunder may be established in the proceedings,” in section 18. The award of a concurrent registration is conditioned only upon the Commissioner’s determination that “confusion, mistake, or deception is not likely to result from the continued use by more than one person of the same or similar marks” under conditions prescribed by the Commissioner. Section 2(d) says nothing about what kind of an inter partes proceeding is required for the Commissioner to make such an award.
Similarly, sections 14 and 16 of the Act, which the majority has construed “in pari materia,” merely recite conditions for the institution of cancellation and interference proceedings, respectively.9 They do not restrict the Commissioner to any particular remedy, and, as indicated above, section 18 gives the Commissioner authority to grant any of the enumerated remedies “as the rights of the parties . . . may be established in the proceedings.” 10
One of the basic purposes of the Act which the majority’s interpretation would frustrate is that of constructive notice (section 22 of the Act).11 By approving the total cancellation of a registration, when it is evident that the registrant possesses some rights in the mark, the majority approves removal of the constructive notice, thus laying a foundation for third parties to transgress those rights. Even if appellant later attempts to assert his rights in a concurrent use proceeding (as the majority apparently envisions), for as long a time as it takes to obtain a restricted registration there will exist no constructive notice of those rights. On the other hand, under the broad interpretation of the Act Judge Baldwin and I favor, there would be no “gap” in the constructive notice; the registration would be restricted, but it would remain at all times on the register as constructive notice to all third parties.12
Another basic purpose of the Act is that the principal and supplemental registers should reflect the actual status of all marks in use; in other words, the registration of a mark should conform, as much as possible, to the owner’s right to use the mark. Alfred Dunhill of London, Inc. v. Dunhill Clothes, Inc., supra 293 F.2d at 691, 49 CCPA at 738,130 USPQ at 418, and authorities cited therein. The record before us establishes that appellant has use rights in at least three states. To totally cancel its registration, as the majority would have it, would prevent the principal register from reflecting this status of the mark until and *86if appellant persists and files a concurrent use application and relitigates the very same issues that have already been litigated in this proceeding. The cost of such reliti-gation not only to the parties but also to the Patent and Trademark Office would be a foolish waste. Under the reasonable and broad interpretation of the Act we favor, all of the rights of the parties would be determined in a single inter partes proceeding, the board would grant the proper remedies, and the register would reflect the true status of the mark or marks.
The decision of the board should be reversed and the case remanded for a determination of the rights of the parties consistent with this opinion.

. My dissenting opinion in Hollowform, Inc. v. Delma AEH, 515 F.2d 1174, 185 USPQ 790 (Cust. & Pat.App.1975) did reach the issue, while the majority opinion merely relied on the rationale that “appellant’s rights in the mark are not superior to appellee’s right.to registration.” Id. at 1176, 185 USPQ at- 791.

. Peame & Crotty, Trade Mark Registration and the Lanham Bill, 23 J. Pat. Off. Soc’y 31, 282 (1941) (“Peame & Crotty”). The version of the bill discussed was H.R. 102, 77th Cong., 1st Sess. (1941).

. These sections, with modification, became the present sections 17 and 18 of the Act, respectively.

. The reference only to the power to cancel is explainable by the fact that the power to restrict did not appear in H.R. 102. The phrase “or restrict” first appeared in section 18 of H.R. 5461, 77th Cong., 1st Sess. (1941), introduced by Congressman Lanham as a substitute for H.R. 102. It appears to have originated in a revision submitted by a joint coordination committee which included representatives from the National Association of Manufacturers, United States Trademark Association, and American Bar Association. Hearings on H.R. 102, H.R. 5461, and S. 895 Before the Snbcom. on TradeMarks of the House Comm, on Patents, 77th Cong., 1st Sess. 131-36 (1941). Unfortunately, the testimony at the hearings sheds no light on the matter.

. 15 U.S.C.A. at 265 (1948).

. Section 17 of the Act was amended August 8, 1958, to provide for the Trademark Trial and Appeal Board to determine the rights of the parties. Act of August 8, 1958, Pub.L. No. 85-609, 72 Stat. 540. The original Act gave this authority to an examiner of interferences. Act of July 3, 1946, ch. 540, § 17, 60 Stat. 434.

. Dunhill was nominally an opposition proceeding, with only one of the parties seeking a registration. Yet, the court termed it a “concurrent” registration even though there was no companion registration issued to the other party.

. The majority improperly assumes that a likelihood of confusion would exist even if appellant’s registration were restricted. The board made no finding on this point. Before this court concludes that appellant-junior user is not entitled to any registration, section 2(d) mandates that the board, acting pursuant to authority delegated by the Commissioner, make a finding of likelihood of confusion (regardless of any restrictions, geographical or otherwise, which could be imposed). Remand to the board for determination on this point is the proper course. It is noted that the board made findings of dates and areas of first use by each of the parties. Such findings would be binding on the parties in any further proceeding between them.

. The majority incorrectly states that “the provision for cancellation proceedings in § 14 speaks only of complete cancellation.” Section 14 merely provides that a petition to cancel a registration may be filed. If the petitioner proves that the registrant has no right to the registration, then the Commissioner has the authority to cancel the registration. However, if it is established that the parties have concurrent rights in the mark, then the Commissioner has the authority to restrict the registration.

. The majority attempts to distinguish Dun-hill, supra, on the basis that there existed a prior court determination of the rights of the parties. However, presence or absence of a prior court decision is immaterial since section 2(d) expressly grants the Commissioner the authority to grant concurrent registrations even absent a court determination.

. “Perhaps the greatest single advantage of registration under the Act is that it is constructive notice of the registrant’s claim of ownership of the mark.” D. Robert, The New TradeMark Manual 129 (1947).

. Although it appears from this record that appellee has a pending application which will be published if appellant’s registration is can-celled, in many instances this would not necessarily be the case. Under the majority’s interpretation, a registrant who in good faith sought and was granted a federal registration may be totally frustrated by a single senior user who has no interest in obtaining a federal registration.