Last week, the U.S. Court of Appeals for the Federal Circuit issued a precedential decision in Great Concepts, LLC v. Chutter, Inc., No. 2022-1212 (Oct. 18, 2023), on appeal from the Trademark Trial and Appeal Board. In 2010, Great Concepts’ counsel filed a combined Section 8 and 15 declaration with the USPTO, declaring in part that the DANTANNA’S mark was not involved in any pending legal proceeding. At the time of that filing, however, the mark was subject to both a cancellation action at the Board and a pending appeal from a trademark infringement lawsuit, both initiated by Chutter’s predecessor. Chutter then filed a new petition to cancel the DANTANNA’S mark in 2015, based on the fraudulent affidavit, which the Board ultimately granted in 2021. Great Concepts appealed to the Federal Circuit.
The Federal Circuit applied a de novo standard of review and reversed, finding the Board was not permitted to cancel the trademark registration based on the unambiguous language in the statute. Section 15 of the Lanham Act enables registered marks to acquire incontestable status after five consecutive years of use following registration—provided there is no pending proceeding involving the owner’s rights in the mark. 15 U.S.C. § 1065. Section 14, however, provides that even an incontestable mark may be canceled if “its registration was obtained fraudulently.” 15 U.S.C. § 1064(3) (emphasis added). For decades, the Board believed that it had the power to cancel a trademark after a fraudulent Section 15 declaration was filed in support of incontestability. See Crown Wallcovering Corp. v. Wall Paper Mfrs. Ltd., 188 USPQ 141 (TTAB 1975); see also Torres v. Cantine Torresella S.r.l, 808 F.2d 46 (Fed. Cir. 1986) (“Fraud in obtaining renewal of a registration amounts to fraud in obtaining a registration within the meaning of section 14(c) of the Lanham Act.”).
Citing the plain and unambiguous language in the Lanham Act, the Court disagreed. It concluded that a declaration of incontestability is not filed in furtherance of obtaining a registration. And although incontestability is an important right—indeed, it is conclusive evidence of the mark’s validity—incontestability is still fundamentally different than registration. The Section 15 declaration filed by Great Concepts did not cause or even contribute to the issuance of the registration. Accordingly, the Court held the Section 15 declaration could not be the basis for canceling the mark under 15 U.S.C. § 1064(3).
