CAFC Confirms That Surnames May Be Registered as Trademarks If They Acquired Distinctiveness

CAFC Confirms That Surnames May Be Registered as Trademarks If They Acquired Distinctiveness

Schlafly v The Saint Louis Brewery LLC, (Fed. Cir. 2017-1468)

In this decision, the United States Court of Appeals for the Federal Circuit (“CAFC”) upheld the Trademark Trial and Appeal Board’s (“TTAB”) decision and confirmed that surnames may be registered as trademarks if the mark acquired distinctiveness. [pg. 10]

Background

The Saint Louis Brewery (“SLB”) is a craft brewery founded by Thomas Schlafly and Daniel Kopman in St. Louis, Missouri in 1989. SLB has been selling beer with the SCHLAFLY logo since 1991, having sold more than 75,000,000 units of beer between 2009 and 2014, not including the sales made in its restaurants. SLB already had trademark registrations for two logo marks that include the SCHLAFLY name and applied to have the word mark “SCHLAFLY” registered for use with various types of beer in 2011. [pg. 2] To support their application, SLB provided a declaration pursuant to Section 2(f) of the Lanham Act (“Section 2(f)”), stating that the mark had acquired distinctiveness due to substantive and continuous use with its goods for at least five years immediately prior to the submission of the application. [pg. 3]

Phyllis Schlafly and Bruce Schlafly (“the Opposers”), two relatives of Thomas Schlafly, opposed the application for the trademark. [pg. 2] Phyllis Schlafly (now deceased) was a known public figure and the Opposers argued that “the surname Schlafly is primarily associated in the minds of the public with Phyllis Schlafly and the traditional values she represented.” Dr. Bruce Schlafly has used his surname in his medical practice since 1986 and argued that the mark will have “[a] negative connotation due to complications with… [d]runk driving [and] intoxication leading to injuries.” [pg. 3-4]

The TTAB denied the oppositions and entitled the SCHLAFLY mark to registration on the Principal Register on the basis of acquired distinctiveness under Section 2(f).  [pg. 4] Having concluded that the mark had acquired distinctiveness, the TTAB stated that it did not need to address whether the mark is primarily merely a surname. The Opposers requested that the TTAB reconsider its decision on the ground that “it was improper to permit registration based on acquired distinctiveness without a survey showing secondary meaning.” The TTAB denied the reconsideration, stating “[t]o be blunt, this was not a ‘close call’.” [pg. 5]

No Law or Precedent Suggesting Surnames Cannot be Registered if Acquired Distinctiveness

The Opposers appealed the TTAB’s decision, claiming a violation to the First Amendment, Fifth Amendment and Due Process rights and protection. [pg. 2]

The CAFC notes that Section 2(f) permits registration of marks that have acquired distinctiveness by use in commerce, and that the TTAB concluded that SLB presented more than sufficient evidence to show that the SCHLAFLY mark had acquired distinctiveness. [pg. 6] The CAFC explains that Section 2.41 of Title 37 of the Code of Federal Regulations provides that three types of evidence may be considered to show secondary meaning: 1) Ownership of prior registration(s); 2) Five years substantially exclusive and continuous use in commerce; and 3) Other evidence (i.e. evidence showing duration, extent and nature of the use in commerce and advertising). [pg. 7] The CAFC explains that SLB presented all three types of evidence, and that the TTAB evaluated fifteen different forms of evidence in reaching its conclusion. The jurisprudence has established that the absence of consumer surveys will not preclude a finding of acquired distinctiveness. [p. 8]

The Opposers argued that SCHLAFLY is recognized primarily as Phyllis Schlafly’s surname, and that the CAFC should adopt a new test, the “change in significance” test, “whereby a surname cannot be registered as a trademark without showing a change in significance to the public from a surname to an identifying mark for specified goods.” The CAFC rejected the Opposers’ argument for a new test. The CAFC further rejected the Opposers’ argument that the TTAB erred in allowing the trademark application, because Section 1052(e)(4) Title 15 of the United States Code prohibits the registration of marks that are primarily merely a surname: “[t]he Board […] correctly stated that the trademark statute provides that words that are primarily merely a surname can be registered trademarks if they have acquired secondary meaning in trademark use.” [pg. 9] The CAFC adds that Section 1052 of Title 15 of the United States Code provides that “[e]xcept as expressly excluded in subsections (a), (b), (c), (d), (e)(3), and (e)(5) of this section, nothing in this chapter shall prevent the registration of a mark used by the applicant which has become distinctive of the applicant’s goods in commerce”. The CAFC explains that while the statutory interpretive cannon expressio unius est exclusio means “expressing one item of [an] associated group or series excludes another left unmentioned”, in Barnhart v Peabody Coal Co, 537 U.S. 149, 168 (2003) it was held that this does not apply to every statutory listing or grouping. The CAFC indicates that “[n]o law or precedent suggests that surnames cannot be registered as trademarks if they have acquired distinctiveness in trademark use.” [pg. 9-10]

The CAFC then addressed the Opposers’ constitutional claims and found that they did not adequately explain how the trademark’s registration improperly infringes on their First and Fifth Amendment rights. [pg. 10] As for their Due Process rights, the CAFC noted that they availed themselves of the opposition procedure, which “provides appropriate process of law.” [pg. 11] The CAFC concludes its decision by affirming the TTAB’s decision. [pg. 11]

Commentary

In this decision, the CAFC confirms that a surname may be registered as a trademark if it has acquired distinctiveness. In this case, SLB was able to demonstrate continuous use of the word mark, the registration of two SCHLAFLY design marks, as well as sale figures which all favored a conclusion of acquire distinctiveness. While the CAFC confirmed that a surname may be registered if the mark acquired distinctiveness; trademark owners and future trademark applicants should aim for a coined or fanciful term (i.e. an invented word) for an inherently distinctive mark. For more information, please consult a trademark agent or IP lawyer at PCKIP.

Due care