RAW power: over dissent, 9th Circuit orders trial on infringement, cancellation of TM applications

BBK Tobacco & Foods LLP v. Central Coast Agriculture, Inc., --- F.4th ----, 2024 WL 1356981, Nos. 22-16190, 22-16281 (9^th Cir. Apr. 1, 2023)

Over a dissent, the panel reverses the grant of summary judgment on noninfringement, reasoning that the overlap in the use of the (descriptive) word RAW between the parties’ somewhat related products was enough to avoid summary judgment—which should rarely be granted in trademark cases (ugh), despite major visual differences and the lack of actual confusion evidence and low confusion rates shown by the parties’ surveys.

plaintiff's RAW

defendant's Raw Garden

Also over a dissent, the panel finds that a court can order trademark applications cancelled, not just registrations. (The panel did affirm the refusal to cancel defendant’s registrations on grounds of unlawful use, since they weren’t for unlawful items.)

BBK sells smoking-related products with RAW branding; CCA allegedly infringed by selling cannabis products with the mark “Raw Garden.” BBK sought to cancel several of CCA’s trademark applications for lack of bona fide intent to use the mark in commerce. “We hold that, under 15 U.S.C. § 1119, when an action involves a claim of infringement on a registered trademark, a district court also has jurisdiction to consider challenges to the trademark applications of a party to the action. We also hold that lack of bona fide intent to use a mark in commerce is a valid basis to challenge a trademark application.”

The dissent disagreed, given that the statutory language is:

In any action involving a registered mark the court may determine the right to registration, order the cancelation of registrations, in whole or in part, restore canceled registrations, and otherwise rectify the register with respect to the registrations of any party to the action.

But, the majority reasoned, the Lanham Act refers to an “[a]pplication for use of trademark” as a “request [for] registration of [a] trademark on the principal register.” “A challenge to an application thus necessarily affects the applicant’s right to a registration…. Indeed, some of the dissent’s own examples use the term ‘right to registration’ when adjudicating an opposition to an application.” Adjudicating applications in a single action was good for speed and efficiency.

The dissent would have allowed the PTO’s iterative registration process to go forward. The dissent would have interpreted “right to registration” in the relevant provision to mean “the court’s authority to adjudicate the ownership, scope, priority, and use of trademarks, which may entitle a party to registration of the mark.” That is, courts could determine who has rights to a trademark, but that’s not the same thing as cancelling pending trademark applications, as the use of “otherwise” in the final phrase of § 1119 indicates. “Of course, the right to registration may affect the applications’ adjudication. But that doesn’t alter Congress’s choice to leave decisions over trademark applications to the PTO.” Noscitur a sociis also supported excluding the authority to cancel trademark applications from § 1119. “Given the neighboring terms, we should likewise read ‘right to registration’ as only a power over completed registrations.” (The section title—“Power of court over registration”—also suggested that federal courts lack jurisdiction to cancel pending trademark applications. “Though a statutory title may never ‘limit the plain meaning of the text,’ a title may sometimes be a helpful interpretative tool.”)