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Trademark Co-Existence AgreementsEvaluating, Negotiating and Structuring Agreements to

Resolve Trademark Disputespresents

Today's panel features:Barbara Grahn, Partner, Oppenheimer Wolff & Donnelly, Minneapolis

Stephen Feingold, Partner, Kilpatrick Stockton, New YorkSusan L. Crane, Group Vice President, Legal Intellectual Property,

Wyndham Worldwide Corporation, Parsippany, N.J.

Thursday, December 3, 2009

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Inter-Party Trademark Agreements

Barbara Grahn, Oppenheimer Wolff & DonnellyStephen Feingold, Kilpatrick Stockton

Susan L. Crane, Wyndham Worldwide Corporation

December 3, 2009

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Coexistence Agreement

• Allows potentially conflicting marks to peacefully coexist in the marketplace without threat of litigation or other dispute

• permits coexistence of marks, including both use and registration of marks, and provides terms to govern continuing coexistence

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Consent Agreement• Is one type of co-existence agreement• Typically used to obtain registration – with

corresponding right to use• Generally doesn’t address respective rights of the parties to

the same extent as a coexistence agreement – often limit the rights of the party seeking consent – or leaves future issues to be dealt with as they arise

• “[I]t is well settled that in the absence of contrary evidence, a consent agreement itself may be evidence that there is no likelihood of confusion.” In re Four Seasons Hotels, Ltd., 26 U.S.P.Q.2d 1071, 1074 (Fed. Cir. 1993)

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Consent Agreements in the USPTO

• “The term ‘consent agreement’ generally refers to an agreement in which a party (e.g., a prior registrant) consents to the registration of a mark by another party (e.g., an applicant for registration of the same mark or a similar mark), or in which each party consents to the registration of the same mark or a similar mark by the other party. “ TMEP § 1207.01(d)(viii)

• “[W]hen those most familiar with use in the marketplace and mostinterested in precluding confusion enter agreements designed to avoid it, the scales of evidence are clearly tilted. It is at least difficult to maintain a subjective view that confusion will occur when those directly concerned say it won’t. A mere assumption that confusion is likely will rarely prevail against uncontroverted evidence from those on the firing line that it is not.” In re E. I. du Pont de Nemours & Co., 476 F.2d 1357, 1363, 177 USPQ 563, 568 (C.C.P.A. 1973)

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Coexistence Agreement

• Both parties have established rights in the mark –in different geographic regions, or for unrelated goods or services

• The parties recognize their rights in their respective marks and agree on terms on which they may exist together in the marketplace

• The agreement attempts to set forth the respective rights of the parties in sufficient detail to avoid future disputes

• Anticipates future expansion of use by the parties – both geographic and field of use

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Concurrent Use Agreement Distinguished

• A coexistence agreement is not the same as a concurrent use agreement.– A “concurrent use” agreement generally refers to a

geographic restriction on use. See, TMEP §§1207.01(d)(viii) and 1207.04

– Concurrent users register the same mark on the same goods in different geographic areas

– Is determined by a concurrent use proceeding in the USPTO

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License Distinguished

• “A license integrates, while a consent differentiates.” McCarthy on Trademarks and Unfair Competition § 18:79 (4th ed.) (2009).

• permits use of a mark under certain terms– Involves common use of a single mark – owned by licensor– vs. separate marks owned by different parties in consent

/coexistence arrangement

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When does the need for a coexistence agreement arise?

• Clearance– Potentially conflicting mark identified in clearance search

• Registration – to address or overcome third-party rights• In response to 2(d) or comparable refusal• In anticipation of refusal

• Litigation – In resolving a trademark dispute to avoid litigation– In settling litigation

• Oppositions/Cancellations– Many oppositions and cancellations are resolved through

coexistence agreements

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When does the need for a coexistence agreement arise?

• Geographic Expansion– When a geographically remote user expands

into another user’s geographic market• Product Line Expansion

– When one user moves into or close to the other’s field of use

• Mergers and Acquisitions– e.g., purchase and sale of product line

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To Ask or Not to Ask?

• Who has priority? – A prior user may have leverage, even if it is the junior

applicant

• What if the other party says “No”?– Is the party asking for prepared to forego use and/or

registration of the mark?– Risk of drawing an opposition or infringement claim

• Will there be a price attached?– Are there dollars budgeted to clear conflicts?

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Potential Downsides

• Dilution of mark – may make it more difficult to enforce the mark or to prevent subsequent registration of similar marks

• May affect value of the trademark or a party’s business – limits expansion – if the other party’s use of the mark reflects

badly on the mark

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The Role of the Public Interest

• A court may reject a coexistence agreement if it believes consumer confusion cannot be avoided

• More likely to be invalidated if there is a public safety issue, e.g., pharmaceuticals or medical devices with closely similar names

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Domestic AgreementsCritical Provisions

• Simple Agreement– Party A Does X– Party B Does Y– Parties Agree No Likelihood of Confusion

• Will work to take additional steps if confusion does arise

– Parties Consent to Registration of marks with USPTO

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Pitfalls to the “Simple Agreement”

• Who has right to product expansion?• Who has right to territorial expansion?• Who has right to domain name?

– Domain Name in ccTLDs or new gTLDs?• New Variations of Mark

– Adding Logo or new words• BALLYS becomes BALLY’S • Caesars Palace becomes Caesars Atlantic City

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More Pitfalls

• Who has right to enforce mark against related or distant goods and services?

• Right to sublicense• Right to assign• What if one party abandons rights?• International issues

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The Big Question

• Is it better to have agreement that is based on the parties never interacting or one that will require interaction on regular basis.– Conservative view: No future interaction

• Unrealistic to expect otherwise

– Brand management view: Need to have interaction since coexistence connects the brands even if no likelihood of confusion

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Defining Goods/Services

• Define what each party does but consider:– Merchandising or promotional use on t-shirts,

coffee mugs, watches, thumb nail drives, – True product expansion

• Virgin – record label airline ?

• Hotel Casino– Condos reality tv show

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A Framework for Resolving

• Party with greater leverage will want to box other side in and leave expansion as its privilege

• One Potential Compromise– Core products of each party reserved to each – Natural expansion for each party reserved to each– Unexpected expansion up for grabs– Limited merchandising for company identity purposes

ok for each.

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Channels of Trade

• Company A uses mark west of Rockies and Company B uses mark east of Rockies. – Can each do national advertising? Or

advertising in border states that slips into territory of other?

– Who can sell product on Internet?• Who will Own Domain Name?

– Can owner allow domain name to lapse?

20

Defining the Mark

• In some circumstances, distinction between brands can be based on small variations in mark:– Use only in close proximity to House Mark and

in never in font that is larger than House Mark.– Use only in combination with Distinctive Logo.

• Is this practical or realistic? – Use only when accompanied by disclaimer.

• Do disclaimers work?

21

Adoption of New Logos

• Often agreements rely on different logos to help distinguish each party.

• Does change in logo require consent of other party? Notice?

• Can party object to new logo when filed together with word mark?

• Can party use abandoned logo of other party?

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Adoption of New Derivative Word Mark

• NBC becomes CNBC• Citibank becomes Citigroup• Lexington, used for insurance company, has

consent agreement with Lexington used for hedge fund; then insurance company wants to create a new slogan: HEDGING AGAINST THE FUTURE: LEXINGTON BANK

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Assignability

• Presumption that license which is silent as to assignability is not assignable

• Presumption that contract silent as to assignability is assignable

• No case law on which presumption applies to consent agreements.

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Term

• How Long Should Agreement Last?– Generally perpetual but neglect to consider

abandonment. • Need to protect against not knowing status of rights

because company disappears. • Absent provision surviving party could still be in

breach of agreement not to use mark in other area. What if company assigned marks before it vanished?

• How does one establish “abandonment?”

25

Third Parties and Enforcement

• Who has right to enforce against third parties? – Does Party A settlement with TP need to

protect Party B? as to which goods/services? – Does Party A have to notify Party B of the

settlement before or after it happens?

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International Considerations

• Agreements between US Parties operating in international markets

• Agreements between US and International parties

• Distinct Goods/Services or Distinct Geographic Trade Channels

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International AgreementsCritical Provisions

• Simple Agreement– Party A Does X in BCD Territories– Party B Does X in EDF Territories; or– Party A Does X Globally– Party B Does & Globally– Parties Agree No Likelihood of Confusion

• Will work to take additional steps if confusion does arise

– Parties Consent to Registration of marks where required

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• Who has right to product expansion?– Need to consider broad identification of goods

and services common in international registration grants

• Are parties required to amend at outset to avoid conflicts in registrations or merely required to provide consent where needed?

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• Who has right to territorial expansion and other cross border issues?– Address creation of new jurisdictions– Cross Border and/or spill over marketing– Internet Marketing issues

• Who has right to domain names? – Domain Name in ccTLDs or new gTLDs?– Domain Name variations and typos– Shared domains

30


• How will the parties use social media and other emerging marketing technologies? – Who has right to user names?– How to police/respond to consumer inquiries if

not clear whose products/services are in issue?

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More Pitfalls

• Right to sublicense – obligate party to record where necessary to insure enforceability of rights

• Right to assign – only to assignee or trademark rights?

• What if one party abandons rights in limited territories?

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Need for Interaction

• May be greater need for interaction in international agreements– Need to execute short form coexistence or

consent agreements on an as need basis– Need to address shifting markets– Need to address emerging marketing trends

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Registration Issues• Are both parties free to register in all territories, or will registration

right be divided, with or without license to other party?

• Agree to provide basic consent agreement or short form coexistence agreement where sufficient.

• Provide mechanism for addressing jurisdictions where consent notsufficient– E.g. Japan: One party seeks registration and then assigns mark to other

party.

• Impact of Associated Marks Doctrine

34

Third Parties and Enforcement

• Enforcement of rights in other party’s geographic territory– Should parties be required to cooperate on

enforcement/join in action where needed?– Grey Market concerns?

35

Enforcement of Terms of the Agreement

• Where will enforcement actions be brought?– Choice of forum/choice of law clauses

• Not all jurisdictions recognize validity of coexistence agreement

• May impact ability to oppose mark registered in violation of agreement.

– Difficulty enforcing injunctions– Does forum recognize specific performance?– Consider arbitration

• Where?• Selection of arbitrator

SETTLEMENT AND TRADEMARK COEXISTENCE AGREEMENT THIS AGREEMENT (this “Agreement”), dated as of ______, 200_, is by and between (1) Party A, having its principal place of business at ______________ (“___”); and (2) Party B, having a place of business at _____________ (“___”).

RECITALS

A. Party A avers that it is the owner of certain trademarks, domain names and copyrights for a project called Mark, which is dedicated to providing information to the public about Weather and Natural Disaster-related subject matter. For purposes of this Agreement, “Weather” shall mean “the state of the atmosphere at a given time and place, with respect to variables such as temperature, moisture, wind velocity, and barometric pressure.” For purposes of this Agreement, “Natural Disaster” shall mean “any event or force of nature that has catastrophic consequences, such as avalanche, earthquake, flood, forest fire, hurricane, lightning, tornado, tsunami, volcanic eruption, avalanches, and droughts and all related outdoor environmental issues including global warming, air pollution, salt-water penetration of wetlands, pollen, water quality and acid rain”.

B. Party B avers that it is the owner of certain trademarks, domain names and copyrights for a project called Mark Variation, which is dedicated to ensuring the safety of children at home, on the streets, at school, and on the Internet. For purposes of this Agreement, “safety” shall mean the condition of being safe from undergoing or causing hurt, injury or loss.

C. Party A avers that it has adopted, presently uses and has acquired common law rights in the mark Mark in word and design form (the “Mark”) and is the owner of the following registered trademarks (collectively the “Party A Registrations”):

Mark Registration Number and Date of Registration

Goods and Services

Mark [Registration number and date]

“production of television [and radio] programs in the fields of education and news” in International Class 41

Mark [Registration number and date] “magazines, newsletters, booklets and brochures in the fields of education and news”

D. Party B avers that it has adopted, presently uses and has acquired common law rights in the mark Mark Variation in word and design form (the “Mark Variation”), and is the

owner of the following pending federal trademark applications and registration (collectively, the “Party B Applications and Registration”):

Mark Serial Number and Date of Filing Goods and Services

Mark Variation [Registration number and date]

“Printed matter, namely books, magazines, pamphlets and coloring books in the field of child safety” in International Class 16

Mark Variation [Registration number and date] “Audiovisual and audio programming in the field of child safety messages, namely pre-recorded video tapes, videodiscs, DVDs, CD-ROMs, audio cassettes, audio CDs, and software, all featuring music, natural sounds, spoken words, photographic images and graphic images” in International Class 09


“Clothing, namely, T-shirts, casual shirts, sweatshirts, sweaters and pants, headgear, namely hat and caps, and footgear, designed to promote and support child safety” in International Class 25

Mark Variation [Registration number and date] “Games, playthings and toys for children, namely puppets, plush toys, pull toys, electronic action toys, board games, hand-held electronic games, electronic board games, role-playing games and multiple activity toys in the field of child safety” in International Class 28


“Online retail store services featuring clothing, footwear, and headgear for children and adults; games, playthings and toys for children; and audio and audiovisual programming for children stored for

Mark Serial Number and Date of Filing Goods and Services playback on pre-recorded video tapes, videodiscs, CD-ROMs, audio cassettes and audio CDs, in the field of child safety” in International Class 35


“Educational and entertainment services rendered through the medium of television, namely, an on-going children's television program in the field of child safety” in International Class 41


“Online retail store services featuring audio and audiovisual programming for children stored for playback on pre-recorded DVDs and software, in the field of child safety” in International Class 35

Mark Variation and Design

[Registration number and date]

“Clothing, namely, T-shirts, casual shirts, sweatshirts, sweaters and pants, headgear, namely hat and caps, and footgear, designed to promote and support child safety” in International Class 25



“Audiovisual and audio programming in the field of child safety messages, namely pre-recorded video tapes, videodiscs, DVDs, CD-ROMs, audio cassettes, audio CDs, and software, all featuring music, natural sounds, spoken words, photographic images and graphic images” in International Class 9



“Educational and entertainment services rendered through the medium of television, namely, an on-going children's

Mark Serial Number and Date of Filing Goods and Services television program in the field of child safety” in International Class 41



“Online retail store services featuring clothing, footwear, and headgear for children and adults; games, playthings and toys for children; and audio and audiovisual programming for children stored for playback on pre-recorded video tapes, videodiscs, DVDs, CD-ROMs, audio cassettes, audio CDs, and software in the field of child safety” in International Class 35



“Games, playthings and toys for children, namely puppets, plush toys, pull toys, electronic action toys, board games, hand-held electronic games, electronic board games, role-playing games and multiple activity toys in the field of child safety” in International Class 28



“Printed matter, namely books, magazines, pamphlets and coloring books in the field of child safety” in International Class 16

E. Party A instituted and has maintained the following opposition and cancellation proceedings in the United States Patent and Trademark Office (“PTO”) opposing or seeking cancellation of the registration of the Party B Mark (collectively, the “Party A Proceedings”):

Opposition Proceeding Number/Application Number or

Registration Number Mark Goods

Opposition No. ________

Application No. ________

Mark Variation “Printed matter, namely books, magazines, pamphlets and coloring books in the field of

Opposition Proceeding Number/Application Number or

Registration Number Mark Goods

child safety” in International Class 16



Mark Variation “Audiovisual and audio programming in the field of child safety messages, namely pre-recorded video tapes, videodiscs, DVDs, CD-ROMs, audio cassettes, audio CDs, and software, all featuring music, natural sounds, spoken words, photographic images and graphic images” in International Class 9



Mark Variation “Educational and entertainment services rendered through the medium of television, namely, an on-going children's television program in the field of child safety” in International Class 41

Cancellation No. ________

Registration No. ________

Mark Variation “Online retail store services featuring audio and audiovisual programming for children stored for playback on pre-recorded DVDs and software, in the field of child safety” in International Class 35

F. In response to the Party A Proceedings, Party B has sought cancellation, in whole or in part, of each of the federal registrations of the Mark (the “Party B Cancellations”).

G. The parties and their representatives have held discussions regarding their current and future (i) use, (ii) marketing, and (iii) distribution plans relating to their respective trademarks and have concluded that there is no likelihood of confusion between their respective uses and registrations of the Party A Mark and the Party B Mark.

H. Rather than continuing with the prosecution and defense of the Party A Proceedings and the Party B Cancellations, the parties desire to assist each other in protecting

their respective marks and avoiding any likelihood of confusion and/or dilution or other violation of each other’s respective rights.

NOW, THEREFORE, for and in consideration of the foregoing and the mutual representations, promises, terms, and conditions contained herein, and for the additional monetary consideration paid with respect to the settlement of the Party A Proceedings contained in a separate confidential Consideration Agreement executed of even date between Party A and Party B, each and for themselves, collectively and individually, agree as follows:

AGREEMENT

1. No Likelihood of Confusion. Provided that each party abides by the representations, promises, terms and conditions contained in this Agreement, the parties acknowledge and state that to their respective best knowledge and belief there is no likelihood of confusion arising as a result of Party A’s use of the Party A Mark and Party B’s use of the Party B Mark particularly in view of the differences in their respective fields of use.

2. Restrictions on Use of the Party A Mark. Party A agrees to the following restrictions on its use of its Party A Mark:

A. Notwithstanding the descriptions contained in Registration Nos. ______ and ________, Party A shall not use the Party A Mark in connection with any goods or services in the context of child safety except as child safety relates to Weather or Natural Disaster.

B. Party A shall not use the Party A Mark in connection with the Party B logos depicted on Exhibit A, or any logo that is substantially similar thereto.

3. Restrictions on Use of the Party B Mark. Party B agrees to the following restrictions on its use of the Party B Mark:

A. Notwithstanding the descriptions contained in the Party B Pending Applications or Registration, Party B shall not use the Party B Mark in connection with any goods or services in the context of Weather or Natural Disaster. B. Party B shall not use the Party B Mark in connection with the Party A logos depicted on Exhibit B or any logos that are substantially similar thereto, provided this restriction does not apply to the use of any particular font.

4. No Confusing Use. The parties shall not intentionally use their respective marks or promote their goods and/or services in connection with their respective marks in a manner that is likely to cause confusion. Neither party will suggest to any third party that an affiliation exists between itself and the other party or the other party’s goods or services.

5. Further Cooperation. Each party will make all reasonable efforts to prevent confusion with the other’s goods and services which might arise from Party A’s use of the Party A Mark and Party B’s use of the Party B Mark. In the event that either party receives a

communication or inquiry from someone who appears to be seeking the other party, the party will use reasonable efforts to direct that person to the other party and then work with one another to identify and then take the reasonable steps needed to alleviate such confusion.

6. Worldwide Mutual Consent to Use and Register. Party A consents to Party B’s (i) worldwide use of the Party B Mark pursuant to the representations, promises, terms, and conditions contained in this Agreement, and (ii) registration of the Party B Mark pursuant to the representations, promises, terms, and conditions contained in this Agreement including, without limitation, in the Party B Pending Applications and Registrations. Party B consents to Party A’s (1) worldwide use of the Party A Mark pursuant to the representations, promises, terms, and conditions contained in this Agreement, and (2) registration of the Party A Mark pursuant to the representations, promises, terms, and conditions contained in this Agreement including, without limitation, in the Party A Registration. Conditioned on the other party’s compliance with the representations, promises, terms, and conditions of this Agreement, neither party will sue or assert any cause of action, either directly or indirectly, against the other for infringement of the other party’s marks.

7. Pending Trademark Oppositions and Cancellation. Within five (5) days after execution of this Agreement, the parties shall cause their respective counsel to dismiss each of the Party A Proceedings and the Party B Cancellations with prejudice by filing the document attached as Exhibit C hereto.

8. Pending Trademark Applications and Registrations. Party A shall not oppose, challenge, or otherwise contest any pending or future application by Party B to register the Party B Mark for use subject to the representations, promises, terms, and conditions contained in this Agreement. Party B shall not oppose, challenge, or otherwise contest any pending or future application by Party A to register the Party A Mark for use subject to the representations, promises, terms, and conditions contained in this Agreement.

9. Delivery of Consents to Use/Register. The parties shall cooperate with each other with respect to each party’s respective efforts to register its respective marks as described in this Agreement in connection with the respective goods and services described in this Agreement and either party may submit a copy of this Agreement to the PTO if such party deems it appropriate. Each party will therefore execute consents to use and/or register, or other documentation, which are consistent with the representations, promises, terms, conditions and spirit of this Agreement.

10. No Other Restrictions on Future Use. The parties understand and agree that other than the restrictions on Party A’s use of the Party A Mark detailed in Section 2 of this Agreement and the restrictions on Party B’s use of the Party B Mark detailed in Section 3 of this Agreement, neither Party A nor Party B shall be otherwise restrained with respect to the use and/or registration of their respective marks.

11. Territorial Scope of the Agreement. This Agreement shall be effective worldwide.

12. No Inducement. The parties hereto represent, warrant and agree that upon executing and entering into this Agreement, that they, and each of them, are not relying upon and have not relied upon any representation, promise, or statement made by anyone which is not recited, contained, or embodied in this Agreement.

13. Binding Agreement on Others. This agreement and all of its representations, promises, terms, and conditions will be binding upon and inure to the benefit of each of the parties hereto and its respective directors, officers, partners, proprietors, attorneys, agents, servants, employees, representatives, affiliates, subsidiaries, shareholders, predecessors, successors and assigns, and also extends to licensees and those using the Party A Mark and the Party B Mark with the permission of the parties.

14. Representation by Counsel. Each of the parties hereto acknowledges that it has sought or had the opportunity to seek the representation of independent counsel with regard to this Agreement.

15. Representations as to Authority. Each party hereto represents and warrants that it has the sole right and exclusive authority to execute this Agreement and that it has not sold, assigned, transferred, conveyed, or otherwise disposed of any claim or demand, or any portion of or interest in any claim or demand, relating to any matter covered hereby.

16. Breach or Default. Nothing in this Agreement will be construed so as to impair any legal or equitable right of any party hereto to enforce any of the representations, promises, terms, and conditions of this Agreement by any means, including without limitation, an action for damages or a suit to obtain specific performance of any or all of the representations, promises, terms, or conditions of this Agreement. In the event of such action, the prevailing party shall be entitled to all costs of the action, including reasonable attorneys’ fees, in addition to any other relief to which such party may be entitled. It is hereby expressly acknowledged by all parties to this Agreement that a breach hereof by any party will cause such immediate and irreparable injury that preliminary and permanent injunctive relief would be appropriate in the event of such breach.

17. Headings. The paragraph headings contained in this Agreement are provided for convenience only and shall not be considered in the interpretation and construction of this Agreement.

18. Waiver. The failure of either party at any time or times to demand strict performance by the other party of any of the representations, promises, terms, or conditions of this Agreement shall not be construed as a continuing waiver or relinquishment thereof and each may at any time demand strict and complete performance by the other of said representations, promises, terms, and conditions.

19. Entire Agreement. This Agreement and the separate letter agreement between Party A and Party B relating to the additional consideration paid with respect to the settlement of the Party A Proceedings constitute the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations and agreements, whether written or oral, relating to such subject matter. This Agreement may not be altered, amended, modified, or

otherwise changed in any respect except by an instrument in writing duly executed by authorized representatives of each of the parties hereto.

20. Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed as an original, but all of which together will constitute one and the same instrument for all purposes. This Agreement shall not be effective until executed by all parties hereto and shall then be effective as to all parties from and after the effective date first set forth above.

21. Confidentiality. The parties shall each keep confidential all provisions of this Agreement and (unless required by law or judicial process after making reasonable efforts to resist disclosure) shall not disclose any of same to any third party (other than the PTO pursuant to the provisions contained in Section 9 of this Agreement) without first obtaining the prior written consent of the other party, which consent shall not be unreasonably withheld. Notwithstanding the foregoing, nothing herein shall preclude either party from disclosing this Agreement in a judicial proceeding where necessary to enforce its terms against the other party.

[REST OF PAGE INTENTIONALLY LEFT BLANK]

Party A Party B

By: By: Title: Title: Date: Date:

EXHIBIT A

[Party B Mark Variation Logos]

EXHIBIT B

[Party A Mark Logos]

EXHIBIT C

[PTO WITHDRAWAL PAPERS]

Documents

A Live 90-Minute Teleconference/Webinar with Interactive Q&Amedia.straffordpub.com/products/trademark-co...Dec 03, 2009 · You can access the audio portion of the conference on the