Federal Circuit Stomps Out Recognition of Separate Registered and Common-Law Trademarks

By Sofia Bonfiglio, JD Candidate L’21

Converse, Inc. v. Int’l Trade Comm., Inc., 909 F.3d 1110 (Fed. Cir. 2018), concerns the alleged infringement of Converse’s trade dress rights arising from its trademark registration and from common law. U.S. Trademark Registration No. 4,398,753 (“the ’753 trademark”), issued to Converse on September 10, 2013, describes the trade-dress configuration: three design elements making up the midsole of Converse’s Chuck Taylor All Star shoes. The court held that ITC erred in applying the wrong standards regarding its invalidity and infringement determinations, vacating and remanding the case for further proceedings. 

At the trial level, while the International Trade Commission (“ITC”) did find that various accused products would have infringed Converse’s mark if the common law trademark was valid, the ITC held Converse’s mark , invalid because it could not establish secondary meaning.  Because registered version of the mark, the ’753 trademark, was not registered until after the accused infringers had first used it, the ITC found there could be no infringement of that mark. Thus, it determined there was no violation of section 337 by the importation of the accused products. 

On appeal, the Federal Circuit concluded that the ITC made a series of errors requiring a remand. Judge Dyk first discussed "the relevant date for assessing secondary meaning, the significance of Converse’s trademark registration, and the benefits arising from that registration." Second, Judge Dyk defined the factors that need to be weighed to determine whether a mark has acquired secondary meaning. Lastly, Judge Dyk addressed "the standard for evaluating likelihood of confusion for determining infringement."

Concerning the timing of the secondary meaning inquiry and the trademark registration relevance, the Federal Circuit stated that ITC’s first error was "failing to distinguish between alleged infringers who began infringing before Converse obtained its trademark registration and those who began afterward." Judge Dyk explained that confusion and inaccuracy stemmed from recognizing two separate marks: a registered mark and common law mark. Instead of this distinction, there is only a single mark, "as to which different rights attach from the common law and from federal registration." Moreover, Judge Dyk found that the ITC’s decision failed to determine the relevant date for assessing the existence of secondary meaning. The court concluded that Converse’s registration "confers a presumption of secondary meaning beginning only as of the date of registration." Thus, it confers "no presumption of secondary meaning before the date of registration." Converse must establish that its mark had acquired secondary meaning before the first infringing use by each respondent. 

With respect to the standards for determining whether a mark has acquired secondary meaning, the court agreed in part with Converse arguing that the ITC erred in its secondary meaning analysis in multiple respects. The court addressed the ITC's seven factors, clarifying that determining whether a mark has acquired secondary meaning should instead be weighed by six interrelated factors: (1) association of the trade dress with a particular source by actual purchasers (typically measured by customer surveys); (2) length, degree, and exclusivity of use; (3) amount and manner of advertising; (4) amount of sales and number of customers; (5) intentional copying; and (6) unsolicited media coverage of the product embodying the mark. It also found that the ITC relied too heavily on prior uses predating the date of registration and the first infringing uses when addressing the significance of the trademark owner’s and third parties’ prior uses of the mark. Uses for the five years before the distinctiveness claim was made should have been considered relevant only if there was evidence that "such uses were likely to have impacted consumers’ perceptions of the mark as of the relevant date."

Additionally, although the court agreed with the ITC that “evidence of the use of similar but not identical trade dress may inform the secondary-meaning analysis,” the court stated that such uses must be “substantially similar to the asserted mark.” The ITC also weighed survey evidence submitted by the intervenors (the CBSC only Butler survey) to support its determination that the mark had not acquired secondary meaning. The Federal Circuit found that in any remand where secondary meaning at the time of registration is a relevant issue, “the Board should analyze whether the survey shows lack of secondary meaning as of the date of registration.” Thus, “unless the survey affirmatively shows a lack of secondary meaning,” survey evidence of secondary meaning is lacking, and this is a neutral factor favoring neither party.

When addressing the standards for determining the likelihood of confusion, Judge Dyk stated that ITC should "reassess the accused products to determine whether they are substantially similar to the mark in the infringement analysis;” the likelihood-of-confusion analysis "turns in part on the similarity of the accused products to the asserted mark." Accused products could not infringe if they were not substantially similar.

Judge O’Malley, concurring-in-part and dissenting-in-part, agreed with the majority that the ITC erred in its legal analysis; thus, she found a remand appropriate. However, she disagreed with majority’s reasoning in that they overlooked important procedural facts and binding statutory authority to reach issues improperly before the court. Specifically, she delineated that the majority: (1) misperceived the scope of the ITC’s authority to invalidate duly issued intellectual property rights when it addressed the issue of the validity of a registered mark; (2) blured the line between the concepts of priority of use under common law and the validity of a registered mark; (3) espoused advisory—and unnecessary—opinions on the weight to be given certain survey evidence and the question of infringement; and (4) ignored the ITC’s statutory obligation to enter remedies against defaulting parties.