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IP Litigator article: "Paradise Troubled by Alleged Unfair Competition Involving Certification Mark"

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In this article, I summarize allegations in a complaint alleging ownership of the word mark "Certified Social Media Strategist" and list trademark principles likely to be considered as the case …

In this article, I summarize allegations in a complaint alleging ownership of the word mark "Certified Social Media Strategist" and list trademark principles likely to be considered as the case progresses in the U.S. District Court for the Northern District of GA.

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  • 1. DEVOTED TO INTELLECTUAL PROPERTY LITIGATION & ENFORCEMENT Edited by the Law Firm of Grimes & Battersby Litigator MAY/JUNE 2013 VOLUME 19 NUMBER 3
  • 2. MAY/JUNE 2013 I P L i t i g a t o r 1 Paradise Troubled by Alleged Unfair Competition Involving Certification Mark What impact, if any, does a fed- eral service mark registration for the stylized logo shown in Exhibit 1 have concerning asserted rights to a subset of words recited in that logo, where those words were disclaimed in the registration? If none, does a supplemental registration for the words alone make a difference? On March 27, 2013, Paradise Media Ventures, LLC d/b/a Inter- active Media Ventures a/k/a Social Media Marketing University (Para- dise) filed a two-count complaint in the Northern District of Geor- gia against Minnesota resident Eric Mills. [Paradise Media Ventures, LLC v. Eric Mills, No. 1:13-cv- 1003-TWT, filed 03/27/13 in the US District Court for the Northern District of Georgia, Atlanta Divi- sion, and assigned to US District Judge Thomas W. Thrash.] Count one recites a cause of action for unfair competition, and count two recites an action for violation of the Georgia Uniform Deceptive Trade Practices Act (GUDTPA), both counts predicated on Mills’ alleged use of the word mark CERTIFIED SOCIAL MEDIA STRATEGIST. [Count One of the complaint does not expressly state whether the unfair competition claim arises under fed- eral law (§ 43(a) of the Lanham Act) or under state law. However, a lib- eral reading of the complaint leads to the conclusion that it purports to state a federal cause of action because ¶ 8 of the complaint asserts that “this Court has federal question subject matter jurisdiction under 28 U.S.C. § 1338.”] The complaint seeks injunctive and monetary relief, plus costs awardable under GUDTPA. Paradise’s Trademark Registrations Though Paradise’s complaint does not assert a cause of action for infringement of a federally-registered mark, it identifies two trademark registrations. Below are provided fur- ther details concerning these registra- tions, as they frame legal principles likely to apply in the case. Paradise is the owner of record of US Service Mark Registration No. 3,900,172 (the ’172 Registra- tion), for the mark (logo) shown in Exhibit 1, for “Education ser- vices, namely, providing Web-based training for certification in the field of social media management.” The ’172 Registration, which issued on January 4, 2011, recites a first-use- in-commerce date of May 15, 2009. During processing of the applica- tion for registration, a US Patent and Trademark Office (USPTO) Trademark Examining Attorney, in an August  22, 2010 Office Action, required the insertion of the follow- ing disclaimer, which now appears in the ’172 Registration: NO CLAIM IS MADE TO THE EXCLUSIVE RIGHT TO USE “CERTIFIED SOCIAL MEDIA STRATEGIST” OR “UNIVERSITY” OR “CER- TIFIED”, APART FROM THE MARK AS SHOWN. The ’172 Registration additionally specifies what the registered mark is: THE MARK CONSISTS OF THE IMAGE OF A SEAL CONTAINING THE WORDS “CERTIFIED SOC- IAL MEDIA STRATEGIST SMM UNIVERSITY” AND 3 STARS, WITH A RIB- BON CROSSING IT WITH THE WORD “CERTIFIED” APPEARING ON THE RIB- BON. Paradise also is the owner of record of a registration appearing on the Supplemental Register, namely, US Service Mark Registration No. 4,208,089 (the ’089 Registration), for the word mark CERTIFIED SOCIAL MEDIA STRATEGIST®, [Though the mark is not registered on the Principal Register, use of the “®” symbol is still appropriate. See 15 U.S.C. § 1111 (authorizing such usage by any “registrant of a mark registered in the [USPTO]”).] for the same services as those recited in the ’172 Registration. The ’089 Registra- tion, which issued on September 11, 2012, recites a first-use-in-commerce date of March 17, 2012. [Paragraph 18 of the complaint, however, alleges that first use of that mark occurred in May 2009.] In a July 3, 2012 Office Action, the USPTO refused registra- tion of that mark on the Principal Register, on the ground that the mark was merely descriptive of the services offered. The Trademark Examin- ing Attorney mentioned the earlier Social Media Mike Cicero Exhibit 1
  • 3. 2 I P L i t i g a t o r MYA/JUNE 2013 disclaimer of the words comprising that mark in the application leading to the ’172 Registration, and pro- vided the applicant with the option of amending the application so as to seek registration on the Supplemen- tal Register. The following day, the applicant amended the application accordingly. Complaint Allegations Paradise alleges that it “has been at the forefront of developing meth- ods for the use and management of Social Media, including training and certifying individuals that use and manage Social Media,” and that it “provides training, certification, and consulting to individuals and com- panies using Social Media to manage and improve image, perception, vis- ibility, leads, sales and market share.” According to the complaint, around 115,000 people have completed Para- dise’s training and certification pro- gram since it began. Paradise states that its work has earned “numerous accolades,” including: • Winner of the International Business Awards “Best Global Training Site.” • “Voted by MASHABLE® as one of the Top Social Media Services for Small Business Globally.” • “Awarded Social Media Mar- keter of the Year by the Technol- ogy Association of Georgia.” The complaint alleges that Mr.  Mills operates the National Institute for Social Media (NISM) (see Exhibit 2) and initially (such as in 2011) used the term CERTIFIED MASTER OF SOCIAL MEDIA to refer to its training program. How- ever, Paradise asserts that in 2012, Mr. Mills, despite having been aware of Paradise’s mark CERTIFIED SOCIAL MEDIA STRATEGIST, decided to use Paradise’s mark to identify NISM’s program, and has since been using that mark. Para- dise alleges that such usage “is likely to cause confusion among current students, prospective students, pro- gram graduates, educational institu- tions and businesses that identify [Paradise’s] CSMS certification as an industry standard.” Applicable Legal Principles Below are summarized general legal principles governing composite marks, trademark disclaimers, and marks registered on the Supplemen- tal Register. 1. The protection afforded by a federal registration of a stylized composite mark (logo) contain- ing disclaimed matter “may be limited to the stylized form of otherwise unregistrable words,” and “a distinctive configura- tion of words does not of itself impart registrability to the words standing alone.” [In re K-T Zoe Furniture, Inc., 16 F.3d 390, 394 (Fed. Cir. 1994).] 2. “[T]he disclaimer of certain words in earlier marks does not constitute waiver of the trademark itself, or of a later- registered trademark—a dis- claimer is not an acknowledgment of descriptiveness and has no effect on plaintiff’s subsequent registration of [the disclaimed words].” [CJ Prods LLC v. Ontel Prods. Corp., 809 F. Supp. 2d 127, 162 (E.D.N.Y. 2011).] 3. Under the Lanham Act: No disclaimer…shall prejudice or affect the applicant’s or regis- trant’s rights then existing or thereafter arising in the dis- claimed matter, or his right of registration on another applica- tion if the disclaimed matter be or shall have become distinc- tive of his goods or services. [15 U.S.C. § 1056(b).] 4. “It is well settled that an appli- cant may seek to register any portion of a composite mark if that portion presents a separate and distinct commercial impres- sion which indicates the source of applicant’s goods or services and distinguishes applicant’s goods or services from those of others.” [In re 1175856 Ontario Ltd., 81 U.S.P.Q.2d 1446, 1448 (T.T.A.B. 2006).] 5. The Lanham Act accords simi- lar treatment as to the effect of the appearance of a mark on the Supplemental Register: “Registration of a mark on the supplemental register shall not constitute an admission that the mark has not acquired distinc- tiveness,” and such registration does not prevent registration on the Principal Register. [15 U.S.C. § 1095.] 6. “Unlike registrations on the Principal Register, registrations on the Supplemental Register do not receive some of the advan- tages extended to marks regis- tered on the Principal Register. Supplemental registration is not prima facie evidence of the valid- ity of the registered mark, of ownership of the mark, or of the registrant’s exclusive right to use the registered mark in commerce.” [In re Chippendales USA, Inc., 622 F.3d 1346, 1353 n.9 (Fed. Cir. 2010).] 7. However, a supplemental regis- tration “enables the registrant to satisfy registration requirements under the trademark laws of for- eign countries, enables the regis- trant to sue for infringement in federal court, and provides useful business information Exhibit 2
  • 4. on a readily accessible, central register.” [In re Bush Bros. & Co., 884 F.2d 569, 570 n.2 (Fed. Cir. 1989).] 8. Because a supplemental registra- tion is not prima facie evidence of validity of the registered mark, the trademark owner must prove that the mark has acquired sec- ondary meaning to maintain an action for infringement or unfair competition. [Avco Corp. v. Pre- cision Airmotive, LLC, No. 4:12- CV-1313, 2012 U.S. Dist. LEXIS 164652, at *7 (M.D. Pa. Nov. 19, 2012).] Mike Cicero is a partner with Womble, Carlyle, Sandridge & Rice, LLP in Atlanta, GA. Copyright © 2013 CCH Incorporated. All Rights Reserved. Reprinted from IP Litigator, May/June 2013, Volume 19, Number 3, pages 40–42, with permission from Aspen Publishers, Wolters Kluwer Law & Business, New York, NY, 1-800-638-8437, www.aspenpublishers.com

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