ARSA Distributing, Inc. v. Salud Natural Mexicana S.A. DE C.V.

This Opinion is a

Precedent of the TTAB

Hearing: February 17, 2022 Mailed: September 28, 2022

UNITED STATES PATENT AND TRADEMARK OFFICE

_____

Trademark Trial and Appeal Board

_____

ARSA Distributing, Inc.

v.

Salud Natural Mexicana S.A. de C.V.

_____

Opposition No. 91240240 (parent)

Opposition No. 91243700

_____

Christine Lebrón-Dykeman and Mike Gilchrist of McKee Voorhees & Sease P.L.C.

for ARSA Distributing, Inc.

Jeffrey M. Furr of Furr Law Firm

for Salud Natural Mexicana S.A. de C.V.

_____

Before Taylor, Greenbaum and English, Administrative Trademark Judges.

Opinion by English, Administrative Trademark Judge:

Salud Natural Mexicana S.A. de C.V. (“Applicant” or “Salud”) seeks registration

on the Principal Register of the standard character mark EUCALIN for

“pharmaceutical products, namely, vitamin supplements, nutritional supplement

made with a syrup with jelly base, honey base, and with a mixture of plants with

Opposition No. 91240240 (parent)

Opposition No. 91243700

propolis base, and herbal remedies in the nature of herbal supplements” 1 in

International Class 5, and the composite mark set forth below for “herbal

supplements; nutritional supplements; vitamin supplements” in International Class

5.2

1 Application Serial No. 86779422, was filed on October 6, 2015 under Section 44(e) of the

Trademark Act, 15 U.S.C. § 1126(e), based on Mexican Registration No. 701995, registered

March 9, 2001. The application includes the following translation statement: “The wording

‘EUCALIN’ has no meaning in a foreign language.”

2 Application Serial No. 87638836, was filed on October 9, 2017 under Section 1(b) of the

Trademark Act, 15 U.S.C. § 1051(b), based on an allegation of an intent to use the mark in

commerce. The application includes the following translation statement: “The wording

‘EUCALIN’ has no meaning in a foreign language.” The application also includes the

following description of the mark and color claim:

The mark consists: the word ‘EUCALIN’ stylized in different colors, the letters

‘E’, ‘U’, and ‘C’ in orange colored with brown color, the letter ‘A’ in brown color,

the letters ‘L’, ‘I’ and ‘N’ in darker brown, the letter ‘I’ with a graphic accent,

on the underside a bee in yellow and black color on a yellow and brown

honeycomb, under the honeycomb, a branch of eucalyptus in green color with

berries in brown color, surrounded by some white with gray bubbles, a green

and white background in several shades.

The color(s) green, white, brown, black, gray, yellow, and orange is/are claimed

as a feature of the mark.

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Opposition No. 91243700

In its notices of opposition, ARSA Distributing, Inc. (“Opposer” or “Arsa”), alleges

prior common law use of the mark EUCALIN for “dietary and nutritional

supplements” and that the Office suspended its application for the EUCALIN mark

based on a potential likelihood of confusion with the marks subject to Applicant’s

involved applications.3 Opposer alleges likelihood of confusion under Section 2(d) of

the Trademark Act, 15 U.S.C. § 1052(d), as the ground for each opposition.

In its operative answers, Applicant makes a few admissions that we discuss in

this opinion to the extent pertinent.4 Applicant otherwise denies the salient

allegations in the notices of opposition.

The oppositions were previously consolidated and tried on the same record. An

oral hearing was held on February 17, 2022. For the reasons explained below, we

dismiss the oppositions.

3Opposition No. 91240240 (the “’240 Opposition”), 1 TTABVUE 4, ¶¶ 3-4; Opposition

No. 91243700 (the “’700 Opposition”), 1 TTABVUE 4, ¶¶ 3, 5, 6.

ARSA is spelled in all capital letters in the notices of opposition, but in their briefs, the parties

refer to Arsa with only an initial capital letter so for the remainder of the decision we do the

same.

Citations to TTABVUE are to the Board’s public online database that contains the opposition

files, available on the USPTO website, www.USPTO.gov. The first number represents the

docket number in the TTABVUE electronic case file and the second represents the page

number(s), if applicable. Unless otherwise noted, all citations are to the record in the ’240

Opposition, which is the parent proceeding.

4 ’240 Opposition, 32 TTABVUE; ’700 Opposition, 4 TTABVUE.

In addition, Applicant pleaded an affirmative defense of unclean hands in the ’240 Opposition

only.

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Opposition No. 91243700

I. Objections and Evidentiary Record

Applicant’s Objection to the Trial Declaration of Rossana Arras

Applicant seeks to exclude the May 7, 2021 trial declaration of Rossana Arras5 on

the ground that “Ms. Arras is a Spanish speaker and the trial declaration that she

signed was completely in English [so] she is not competent to know what she was

signing in the trial declaration and if those statements and the evidence associated

with them were true.”6 In support of this position, Applicant submitted: (1) the trial

declaration of its attorney Jeffrey Furr attaching a January 15, 2019 email from

Opposer’s counsel, Christine Lebrón-Dykeman, who represented that Applicant

would “need a translator” for Ms. Arras’ discovery deposition “as Ms. Arras is a

Spanish speaker”;7 and (2) portions of the discovery deposition of Ms. Arras reflecting

that the deposition was “given through an interpreter[.]”8

Opposer does not argue the merits of Applicant’s objection but rather asserts that

exclusion of the testimony would not be “determinative of the issues in this case as

there are two additional witnesses … who provided Trial Testimony” for Opposer. 9

The record supports that Ms. Arras is not an English speaker. And opposer did

not object to the exclusion of her testimony, instead pointing to the testimony of

additional witnesses. As Opposer concedes, a certified and signed translation should

5 Rossana Arras Declaration, 54 TTABVUE (redacted); 55 TTABVUE (confidential).

6 Applicant’s Brief, 77 TTABVUE 8.

7 71 TTABVUE 5, 7, ¶ 3 and Exhibit A.

8 70 TTABVUE 5-6.

9 78 TTABVUE 6, n.1.

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have been, but “was inadvertently not[,] filed with Arsa’s Notice of Reliance.”10 See

Empresa Cubana Del Tabaco v. General Cigar Co., 2019 USPQ2d 227680, at *1 n.1

(TTAB 2019) (noting that petitioner provided testimony declarations with

translations from Spanish to English); cf. Int’l Dairy Foods Assoc. v. Interprofession

du Gruyère, 2020 USPQ2d 10892, at *7-8 (TTAB 2020) (giving no consideration to

evidence consisting of documents in whole or in part in a foreign language without an

English translation). Accordingly, Applicant’s objection is sustained.

We give no consideration to Rossana Arras’ trial declaration or exhibits thereto,

with the exception that we have considered: (1) the first page of Exhibit A (54

TTABVUE 11) consisting of a July 25, 2017 partial TSDR record for Opposer’s now-

cancelled Registration No. 3912708 for the standard character mark EUCALIN11

because it is an official record that would have been admissible under a notice of

reliance, Trademark Rule 2.122(e)(1), 37 C.F.R. § 2.122(e)(1);12 and (2) Exhibit E (54

TTABVUE 26-30) consisting of a printout from Amazon.com bearing a complete URL

address and date because this document would have been admissible under notice of

reliance as a printed publication. Trademark Rule 2.122(e)(2).

10 78 TTABVUE 6, n.1.

11 The registration was cancelled effective February 2, 2017 due to Opposer’s failure to file a

Section 8 affidavit, 15 U.S.C. § 1058. 62 TTABVUE 4-6. Land O Lakes, Inc. v. Hugunin, 88

USPQ2d 1957, 1959 (TTAB 2008) (“Inasmuch as applicant did not file any paper to maintain

his registration, his rights in the prior registration were extinguished on the day after its

sixth anniversary date.”).

12 54 TTABVUE 11. STX Financing, LLC v. Terrazas, 2020 USPQ2d 10989, at *2 (TTAB

2020) (“The file history of an application, or a portion thereof, may be submitted under notice

of reliance as an official record under Trademark Rule 2.122(e)(1).”); Weyerhaeuser Co. v.

Katz, 24 USPQ2d 1230, 1231 n.1 (TTAB 1992) (copy of drawing from abandoned application

admissible under notice of reliance).

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Opposition No. 91243700

Applicant’s Renewed Objection to Opposer’s Designation of Certain

Material as “Attorneys’ Eyes Only” under the Standard Protective

Order

Applicant also renews its August 26, 2020 motion asserting that Opposer has

improperly designated its responses to Interrogatory Nos. 1-4 as Confidential

Attorneys’ Eyes Only under the Standard Protective Order (“SPO”) that is

automatically applicable in this proceeding.13 Trademark Rule 2.116(g), 37 C.F.R.

§ 2.116(g). Applicant argues the “designation [is] not appropriate and deals with

potential wrong doing [sic] by third parties and the Opposer which Applicant’s

Attorney believes that he has an ethical obligation to disclose to the Applicant.”14

Opposer opposes the motion arguing that Applicant did not make a good faith

effort to resolve this dispute before filing its motion and that “the identity of Arsa’s

manufacturer meets both necessary elements for designation as a trade secret under

the … Uniform Trade Secret Act” of Texas, the state in which Opposer is

“incorporated and resides.”15

13 Applicant’s Motion, 41 TTABVUE (objecting to confidentiality designation); January 29,

2021 Order, 46 TTABVUE 16, n.15 (denying Applicant’s motion “without prejudice to renewal

at final hearing”); Applicant’s Brief, 77 TTABVUE 11 (renewing motion).

Applicant filed two redacted copies of its motion. We cite the later-filed redacted motion at

41 TTABVUE.

14 Applicant’s Brief, 77 TTABVUE 11.

15 Opposer’s Response to Motion, 42 TTABVUE 4 (improperly designated confidential)

(incorporated by reference into Opposer’s Rebuttal Brief at 79 TTABVUE 14, also improperly

designated confidential). See Trademark Rule 2.116(g), 37 C.F.R. § 2.116(g) (“The Board may

treat as not confidential that material which cannot reasonably be considered confidential,

notwithstanding a designation as such by a party.”).

Opposer further argues that Applicant’s “renewed challenge should be denied” because

Applicant “proffered no new arguments as to why this information should not be maintained

as Attorney’s Eyes-Only material; it simply reiterates and rehashes the arguments made in

the original motion.” Opposer’s Rebuttal Brief, 79 TTABVUE 14 (confidential). This

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As to Opposer’s first argument, Applicant attached to its motion copies of emails

between the parties’ counsel in which Applicant attempted to address Opposer’s

confidentiality designations. These emails demonstrate that Applicant made a good

faith attempt to resolve the confidentiality dispute before filing its motion.16

As to Opposer’s second argument, we need not consider whether the identity of

the entities manufacturing and packaging Opposer’s goods rises to the level of a

“trade secret” under the Texas Trade Secret Act because, under the Board’s standard

protective order, information may be designated “Attorneys’ Eyes Only” if it is a

“trade secret” or other “commercially sensitive” information that a party seeks to

protect, such as “sensitive information including current research, development and

manufacturing information.”17

We now consider whether Opposer’s AEO designations are appropriate. The

interrogatories at issue are as follows:18

INTERROGATORY NO. 1: Identify who produced the products sold by

Opposer under the EUCALIN mark, the products they produced for the

Opposer, the number of products they produced for the Opposer and the

amount paid to them by Opposer for each product for each year from

2008 until the present?

argument, also improperly filed under seal, is without merit. In its January 29, 2021 Order,

the Board did not determine the merits of Applicant’s motion but denied the motion “without

prejudice to renewal at final hearing.” 46 TTABVUE 16, n.15. Accordingly, Applicant was

permitted to renew its earlier arguments.

16 The SPO provides that if there is a dispute over a confidentiality designation, the parties

must “negotiate in good faith” to attempt to resolve the dispute.

https://www.uspto.gov/sites/default/files/documents/Standard%20Protective%20Order_0205

2020.pdf (Terms of Order, ¶ 14).

17 SPO, Terms of Order, ¶ 1.

18 Opposer’s Motion, 41 TTABVUE 15-18.

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INTERROGATORY NO. 2: Identify who produced the packaging for the

goods sold under the EUCALIN mark for each year from 2008 until the

present?

INTERROGATORY NO. 3: Has ARSA at any time manufacture[d] the

syrup sold under the EUCALIN mark?

INTERROGATORY NO. 4: Has ARSA at any time manufacture[d] any

goods sold under the EUCALIN mark?

In response to Interrogatory No. 1, Opposer identified how it presently

manufactures EUCALIN products and the entities who “ha[ve] produced products.”19

Similarly, in response to Interrogatory No. 2, Opposer identified how it presently

sources packaging for its EUCALIN products as well as the entities “that originally

… produced the syrup with the packaging and labels.”20

As discussed below, the entities that manufactured EUCALIN products and

packaging for Opposer prior to 2017 are identified in two publicly-available legal

opinions issued by the Mexican Institute of Industrial Property.21 Applicant filed

translated copies of these documents that are publicly accessible at 60 and 61

TTABVUE, without objection from Opposer. Accordingly, this information is not

eligible for protection under any tier of confidentiality in the SPO.22 We find, however,

that the remainder of Opposer’s responses to Interrogatory Nos. 1 and 2 comprise

19 39 TTABVUE 17 (confidential). We do not consider this portion of Opposer’s interrogatory

response confidential so we do not treat it as such. Trademark Rule 2.116(g).

20 39 TTABVUE 17 (confidential). We likewise do not consider this portion of Opposer’s

interrogatory response confidential so we do not treat it as such. Trademark Rule 2.116(g).

21 60 TTABVUE; 61 TTABVUE.

22 SPO, Terms of Order, ¶ 2 (“Information may not be designated as subject to any form of

protection if it … is, or becomes, public knowledge, as shown by publicly available writings,

other than through violation of the terms of this Order[.]”).

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“commercially sensitive” information properly designated “Attorneys’ Eyes Only.” We

further find that Opposer appropriately designated its responses to Interrogatory

Nos. 3 and 4 as “Attorneys’ Eyes Only.”

As to Applicant’s counsel’s “belie[f] that he has an ethical obligation to disclose to

the Applicant” Opposer’s responses to Interrogatory Nos. 1-4, we recognize that

attorneys have ethical obligations to clients but Applicant has not cited any rule that

such an ethical obligation is an exception to an attorney’s obligation under the SPO

to protect information properly designated as “Attorneys’ Eyes Only.” Moreover, the

SPO provides that “[d]isclosure of information protected under the terms of this Order

is intended to facilitate the prosecution or defense of this Board proceeding.”23

Accordingly, Applicant’s attorney is obliged to comply with the SPO to the extent

Opposer has properly identified information as “Attorneys’ Eyes Only.”24

In view of the foregoing, Applicant’s motion is granted, in part, to the extent

that within thirty days of the date of this opinion, Opposer must remove the

“Attorneys’ Eyes Only” designations with respect to the entities who “ha[ve] produced

products” prior to 2017 (response to Interrogatory No. 1) and the entities “that

originally … produced the syrup with the packaging and labels” (response to

23 SPO, Terms of Order, ¶ 11 (emphasis added).

24 The Board takes no position as to whether the SPO establishes contractual rights or is

enforceable outside of these consolidated proceedings. Such issues are for the appropriate

judicial forum to decide. SPO, Introductory Paragraph (noting that it “may be desirable to”

exchange signed copies of the SPO but that enforceability of the SPO outside of the Board

proceeding is not for the Board to decide).

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Interrogatory No. 2). See Section IV. below (reiterating this requirement and setting

out consequences for noncompliance). Applicant’s motion is otherwise denied.

Evidentiary Record

The record includes the pleadings and, by operation of Trademark Rule

2.122(b)(1), 37 C.F.R. § 2.122(b)(1), Applicant’s involved applications. The parties also

introduced evidence during trial.

Opposer’s evidence consists of:

1. Opposer’s Notice of Reliance on:25

• the Trademark Status and Document Retrieval (“TSDR”) database

record and portions of the file history for Opposer’s pleaded application

Serial No. 87778409;26

• TSDR database records and portions of the file histories for previously-

abandoned applications owned by Applicant for marks consisting of or

incorporating the term EUCALIN;27

• Applicant’s admissions to Opposer’s Requests for Admission Nos. 1-14;28

and

• Applicant’s responses to Opposer’s Interrogatory Nos. 2, 3, and 4;29

25 Opposer also introduced TSDR records and portions of the file histories for Applicant’s

involved applications and the operative pleadings in these consolidated proceedings. 51

TTABVUE 32-55; 111-154; 52 TTABVUE (Applicant’s confidential answer). This was

unnecessary as these documents are automatically of record. Trademark Rule 2.122(b)(1);

Poly-Am., L.P. v. Ill. Tool Works Inc., 124 USPQ2d 1508, 1510 (TTAB 2017) (record

automatically includes pleadings (excluding exhibits not admissible with the complaint

under Trademark Rule 2.122(d)) and involved applications or registrations).

26 51 TTABVUE 8-31.

27 Id. at 56-95.

28 Id. at 96-101.

29 Id. at 102-110.

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2. Trial Declaration of Sergio Arras, prior shareholder and manager for

Opposer from June 2008 to January 2011;30

3. Trial Declaration, and accompanying exhibits, of Yesenia Medrano, sales

representative for Opposer;31 and

4. Certain exhibits attached to the excluded trial declaration of Rossana

Arras, as described in Section 1.A above.32

Applicant introduced the following evidence:

1. Applicant’s first Notice of Reliance on a docket sheet from TTABVUE, the

Board’s electronic docketing system, for Cancellation No. 92064070;33

2. Applicant’s second Notice of Reliance on “a printout of the public records

and a signed translation of a public document finding of infringement by

[the] MEXICAN INSTITUTE OF INDUSTRIAL PROPERTY DIVISIONAL

DIRECTORATE FOR INTELLECTUAL PROPERTY against the company

Nayec [of] its rights to the EUCALIN mark”;34

3. Applicant’s third Notice of Reliance on “a printout of the public records and

a signed translation of a public document finding of infringement by [the]

MEXICAN INSTITUTE OF INDUSTRIAL PROPERTY DIVISIONAL

DIRECTORATE FOR INTELLECTUAL PROPERTY against Empacadora

Therbal of its rights to the EUCALIN mark”;35

4. Applicant’s fourth Notice of Reliance on the TSDR database record for and

portions of the file history from Opposer’s now-cancelled Registration No.

3912708 for the standard character mark EUCALIN;36

30 53 TTABVUE.

31 56 TTABVUE (redacted); 57 TTABVUE (confidential).

32 54 TTABVUE 11, 26-30.

33 59 TTABVUE. The pleaded ground for cancellation is not of record. As discussed below,

however, this was a cancellation action brought by Applicant against Opposer’s Reg. 3912708

for the standard character mark EUCALIN. The proceeding was terminated after Reg. No.

3912708 was administratively cancelled for Opposer’s failure to file the required

maintenance documents. 62 TTABVUE 4; see also 59 TTABVUE 4.

34 60 TTABVUE.

35 61 TTABVUE.

36 62 TTABVUE. Applicant unnecessarily attached two copies of the documents to its notice

of reliance.

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5. Applicant’s fifth and sixth Notices of Reliance on Opposer’s supplemental

partial responses to Applicant’s first set of Interrogatories37 and verification

of those responses;38

6. Applicant’s seventh Notice of Reliance on English translations for two

Mexican trademark registration certificates in Applicant’s name and

accompanying certification from the translator;39

7. Applicant’s eighth Notice of Reliance on a May 22, 2015 letter from the U.S.

Treasury Department to Applicant’s attorney;40

8. Applicant’s ninth Notice of Reliance on portions of the March 1, 2019

discovery deposition of Rossana Arras;41

9. Trial Declaration, and accompanying exhibits, of Luis Alfonso Tirado Diaz,

Sole Administrator for Applicant;42

10. Trial Declaration, and accompanying exhibit, of Applicant’s attorney,

Jeffrey Furr;43 and

11. Trial Deposition of Yesenia Medrano, taken July 27, 2021.44

II. Entitlement to a Statutory Cause of Action

Opposer must demonstrate that it is entitled to bring a statutory cause of action

against Applicant. See Australian Therapeutic Supplies Pty. Ltd. v. Naked TM, LLC,

37 64 TTABVUE (confidential); 65 TTABVUE (redacted).

38 66 TTABVUE. The verification, signed by Rossana Arras, is in English and no signed

translation is of record so we give the verification no consideration for the reasons explained

in Section I.A. above.

39 67 TTABVUE.

40 69 TTABVUE.

41 70 TTABVUE.

42 68 TTABVUE. Applicant improperly filed the declaration under a notice of reliance but the

error is harmless. See, e.g., Ricardo Media Inc. v. Inventive Software, LLC, 2019 USPQ2d

311355, at *2-3 (TTAB 2019); WeaponX Performance Prods. Ltd. v. Weapon X Motorsports,

Inc., 126 USPQ2d 1034, 1037 (TTAB 2018).

43 71 TTABVUE. This declaration also was improperly submitted under notice of reliance but

again the error is harmless.

44 73 TTABVUE.

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965 F.3d 1370, 2020 USPQ2d 10837, at *3 (Fed. Cir. 2020), cert. denied, 142 S. Ct. 82

(2021) (citing Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 109

USPQ2d 2061, 2067 n.4 (2014)). Specifically, Opposer must prove that these

consolidated opposition proceedings are within its zone of interests protected by the

statute, 15 U.S.C. § 1063, and that it has a reasonable belief in damage proximately

caused by registration of the marks, i.e., that it is not a mere intermeddler.

Corcamore, LLC v. SFM, LLC, 978 F.3d 1298, 2020 USPQ2d 11277, at *6-7 (Fed. Cir.

2020), cert. denied, 141 S. Ct. 2671 (2021).

Opposer introduced a printout from the USPTO’s Trademark Status and

Document Retrieval (TSDR) database and a copy of a suspension notice from the

USPTO demonstrating that Opposer’s pleaded application Serial No. 87778409 for

the standard character mark EUCALIN has been suspended pending a potential

refusal under Section 2(d) of the Trademark Act, 15 U.S.C. § 1052(d), based on a

likelihood of confusion with Applicant’s involved marks.45 This evidence is sufficient

to demonstrate Opposer’s entitlement to a statutory cause of action. See, e.g., Nextel

Commc’ns, Inc. v. Motorola, Inc., 91 USPQ2d 1393, 1400 (TTAB 2009); Life Zone Inc.

v. Middleman Grp. Inc., 87 USPQ2d 1953, 1959 (TTAB 2008) (“Opposer’s evidence of

its pending trademark application, and evidence that the application has been

suspended pending resolution of the subject application demonstrate that opposer

has a reasonable belief that it would be damaged by registration of applicant’s mark,

thus establishing [entitlement].”).

45 51 TTABVUE 18-31.

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III. Priority

A. Applicable Law

Section 2(d) of the Trademark Act prohibits the registration of a mark that

“[c]onsists of or comprises a mark which so resembles a mark registered in the Patent

and Trademark Office, or a mark or trade name previously used in the United States

by another and not abandoned, as to be likely, when used on or in connection with

the goods of the applicant, to cause confusion, or to cause mistake, or to deceive[.]” 15

U.S.C. § 1052(d). For purposes of priority, “proprietary rights may arise from a prior

registration, prior trademark or service mark use, prior use as a trade name, prior

use analogous to trademark or service mark use, or any other use sufficient to

establish proprietary rights.” Herbko Int’l Inc. v. Kappa Books Inc., 308 F.3d 1156, 64

USPQ2d 1375, 1378 (Fed. Cir. 2002).

Opposer relies for priority purposes on common law rights in the mark EUCALIN

for “dietary and nutritional supplements.” To establish prior common law rights,

Opposer must prove by a preponderance of the evidence that its pleaded EUCALIN

mark is distinctive, inherently or otherwise, and that it used the EUCALIN mark

prior to Applicant’s actual first use or constructive first use dates.46 See DeVivo v.

Ortiz, 2020 USPQ2d 10153, at *3 (TTAB 2020); Exec. Coach Builders, Inc. v. SPV

Coach Co., 123 USPQ2d 1175, 1180 (TTAB 2017) (“[B]ecause unregistered marks are

not entitled to the presumptions established under Trademark Act Section 7(b)-(c), it

46 The parties do not dispute and we agree based on the record before us that the mark

EUCALIN is inherently distinctive for “dietary and nutritional supplements.”

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is Opposer’s burden to demonstrate that it owns a trademark that was used prior to

Applicant’s first use or constructive use of its mark and not abandoned.”) (citing Life

Zone v. Middleman Grp., 87 USPQ2d at 1959). In assessing whether Opposer has

established priority, we consider the evidence of record as a whole. W. Fla. Seafood,

Inc. v. Jet Rests., Inc., 31 F.3d 1122, 31 USPQ2d 1660, 1663 (Fed. Cir. 1994) (“[O]ne

should look at the evidence as a whole, as if each piece of evidence were part of a

puzzle which, when fitted together, establishes prior use.”).

B. Parties’ Arguments

Opposer argues that “[t]he ongoing sales and advertising by Arsa of its EUCALIN

product from 2008 to October 6, 2015 and October 9, 2017 establish that Arsa has

used its EUCALIN mark long before the constructive use filing dates of both the ‘422

and ‘836 Applications, and thus Arsa has priority of use of the EUCALIN mark on

nutritional and dietary supplements.”47

Applicant counters that it has priority in the EUCALIN mark based on use since

1999. Specifically, Applicant asserts that between 1999 and October 2008 Opposer

was its U.S. distributor and, therefore, “all of the goodwill of any EUCALIN labeled

product went to the Applicant as the supplier of the goods and products.”48

In reply, Opposer asserts that there was no distribution agreement between the

parties but even if Applicant “could have reasonably claimed rights based on some

alleged distribution agreement before 2008” Applicant “has long since abandoned any

47 Opposer’s Brief, 75 TTABVUE 21.

48 Applicant’s Brief, 77 TTABVUE 19; see also id. at 20-23.

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rights it would have had[.]”49 Specifically, Opposer asserts that: (1) on October 2,

2008, Applicant was “declared a Specially Designated Narcotics Trafficker” (“SDNT”)

and was “legally banned from conducting business in the United States until May

2015” when Applicant was removed from the SDNT list; and (2) Applicant “failed to

produce any testimony or documentation establishing that [it] had concrete plans …

of intent to resume use between 2008 and 2015[.]”50

Applicant admits that it was prohibited from doing business in the United States

from October 2008 to May 2015 as a sanction, but asserts that it did not abandon the

EUCALIN mark because: (1) Opposer’s use, as a distributor, would still inure to its

benefit; and, in the alternative, (2) the nonuse was excusable as Applicant “affirmably

did what it could do to protect its rights to the EUCALIN mark in the United

States.”51

C. Factual Findings

Opposer was formed in September 1999 and that same year started promoting

and selling “dietary and nutritional supplements, including cough syrup” in the

United States under the EUCALIN mark in the following format: .52

As set out on the product packaging below, the products were manufactured by

49 Opposer’s Brief, 75 TTABVUE 22.

50 Id. at 18, 23.

51 Applicant’s Brief, 77 TTABVUE 24, 32.

52 Sergio Arras Declaration, 53 TTABVUE 2-3, ¶¶ 3, 6; Rossana Arras Discovery Deposition,

70 TTABVUE 10-11. Sergio Arras testified that Rossana Arras managed Opposer from 2002

to 2007 and acquired Opposer in its entirety in 2011. Sergio Arras Declaration, 53 TTABVUE

2-3, ¶¶ 3-4.

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Applicant in Mexico and distributed by Opposer in the United States (red arrows

added by the Board).53

53 Sergio Arras Declaration, 53 TTABVUE 3-4, ¶¶ 7, 15. The text highlighted by the red

arrows reads: “Made in Mexico by Salud Natural” and “Distributed by ARSA.”

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There is conflicting testimony regarding whether there was a distribution

agreement between the parties.54 Accordingly, we find that there was no clear

agreement between the parties.

Applicant created the EUCALIN mark and product formulation and “manage[d]

the products … under the name EUCALIN” while Opposer was the exclusive U.S.

distributor for EUCALIN products, responsible “for building up the EUCALIN

business in the United States[.]”55 Opposer “solicited its own customers, and

maintained those relationships”; Applicant “never told Arsa who to solicit as

customers, never spoke directly with any of Arsa’s customers, never visited Arsa’s

customers, and never interacted directly with Arsa’s customers.” 56 Applicant did not

“set out any rules or restrictions regarding Arsa’s sales or promotions of products,”

such as minimum sales requirements or marketing budgets.57 Nor did Applicant “pay

for any marketing done by Arsa” or take back any unsold or returned products.58

Opposer fielded customer inquiries and complaints as only Opposer’s telephone

number and website address were printed on the product packaging.59

On October 2, 2008, Applicant was banned from doing business in the United

States when the U.S. Treasury Department, Office of Foreign Assets Control

54 Díaz Declaration, 68 TTABVUE 5, ¶ 4; Sergio Arras Declaration, 53 TTABVUE at 3, ¶ 8.

55 Rossana Arras Discovery Deposition, 70 TTABVUE 10-11; Sergio Arras Declaration, 53

TTABVUE 3-5, ¶¶ 7-9, 12, 19.

56 Sergio Arras Declaration, 53 TTABVUE 3, at ¶ 11.

57 Id. at 4, ¶ 13.

58 Id. at ¶¶ 13-14.

59 Id. at ¶¶ 14-15.

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(“OFAC”), designated Applicant as a SDNT under the Kingpin Act.60 With Applicant

sidelined, Opposer secured a new manufacturer for EUCALIN products to maintain

“ongoing customer relationships.”61 Because Opposer was not privy to the formula for

EUCALIN products, the new manufacturer developed a new product for Opposer to

sell in the United States starting in late 2008.62 Also, on October 22, 2008, Opposer

filed a U.S. trademark application for the standard character mark EUCALIN for

“dietary and nutritional supplements” which matured into Registration No.

3912708.63

On May 22, 2015, the OFAC removed Applicant from the SDNT list, thus lifting

the ban on Applicant conducting business in the United States and unblocking

Applicant’s property interests in the United States.64 Thereafter, on:

• October 6, 2015, Applicant filed the involved application for the standard

character mark EUCALIN;

60 ’240 Opposition, 1 TTABVUE 4-5, ¶¶ 12-13; 32 TTABVUE 3, ¶¶ 12-13; ’700 Opposition, 1

TTABVUE 6, ¶ 22; 4 TTABVUE 4, ¶ 22.

As a result of being designated a SDNT under the Kingpin Act, Applicant’s “property and

interests in property within the United States” were blocked while the sanctions were in

effect. 21 U.S.C. § 1904(b).

61 Sergio Arras Declaration, 53 TTABVUE 5, ¶ 18.

62 Id. at ¶¶ 19, 21 (Mr. Arras does not testify as to when precisely Opposer started selling a

new product under the EUCALIN mark but he avers that it was in 2008 after sanctions were

imposed on Applicant).

63 Id. at ¶ 17; 62 TTABVUE 4-6. This registration was cancelled. See n.11, supra.

64 ’240 Opposition, 1 TTABVUE 4-5, ¶¶ 11-13; 32 TTABVUE 3, ¶¶ 11-13; ’700 Opposition, 1

TTABVUE 6-7, ¶¶ 21-24; 4 TTABVUE 4, ¶¶ 21-24; Sergio Arras Declaration, 53 TTABVUE

3, ¶ 5.

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• January 29, 2016, Applicant “petitioned [the Mexican Institute of Industrial

Property “IMPI”] for an administrative statement on infringement”65 against

Empacadora Therbal S.A. de C.V. (“Empacadora Therbal”),66 an entity that

“produced [EUCALIN] syrup with the packaging labels” for Opposer.67 On

October 25, 2016 the IMPI granted, in part, Applicant’s petition finding that

Applicant owned rights to the EUCALIN mark in Mexico and that Empacadora

Therbal infringed these rights under Article 213, section XVIII of the

Industrial Property Law:

[Empacadora Therbal] manufactures the products under contract

with the EUCALIN® denomination, to sell them first to Grupo

Botanico Nayec SA de CV, which corporation in turn sells this

product to the corporation Arsa Distributing Inc. and from said

physical samples it is evident that ARSA Distributing Inc.

appears as such product’s distributor.68

• July 14, 2016, Applicant filed a petition to cancel Opposer’s Registration No.

3912708 for the standard character mark EUCALIN;69 the registration was

subsequently cancelled on February 1, 2017 due to Opposer’s failure to file a

declaration under Section 8 of the Trademark Act;70

65 We use the abbreviation IMPI because it is the abbreviation used by the Mexican Institute

of Industrial Property.

66 61 TTABVUE 4.

67 64 TTABVUE 7 (confidential). For the reasons explained in Section I.B. above, this

information was improperly filed under seal.

68 61 TTABVUE 17-19; see also id. at 14 (reproducing invoices from Empacadora Therbal to

Grupo Botánico and Grupo Botánico to Arsa Distributing Inc. with an address in El Paso,

Texas).

69 59 TTABVUE 4-5.

70 62 TTABVUE 4.

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• August 17, 2016, Applicant “petitioned [the IMPI] for an administrative

statement on infringement” of the mark EUCALIN against Grupo Botánico

Nayec, S.A. de C.V. (“Grupo Botánico”),71 an entity that “produced [EUCALIN]

syrup with the packaging labels” for Opposer.72 On March 31, 2017, the IMPI

granted, in part, Applicant’s petition against Grupo Botánico finding that

Applicant owned rights to the EUCALIN mark in Mexico and that Grupo

Botánico infringed these rights under Article 213, section XVIII of the

Industrial Property Law:

[W]e find that Grupo Botánico … markets its products consisting

of syrups under the EUCALIN denomination … in favor of Arsa

Distributing Inc. and from said physical samples it is evident that

Arsa Distributing Inc. appears as such product’s distributor. 73

• October 9, 2017, Applicant filed the involved application for the composite

EUCALIN & Design mark.

Analysis

1. Manufacturer-Distributor Relationship

As summarized above, Applicant argues that Opposer was its U.S. distributor for

EUCALIN dietary and nutritional supplements, and therefore, Opposer’s use of the

EUCALIN mark from 1999 to 2008 inured to Applicant’s benefit conferring ownership

of the mark to Applicant.

71 60 TTABVUE 4.

72 64 TTABVUE 7 (confidential). For the reasons explained in Section I.B. above, this

information was not properly filed under seal.

73 60 TTABVUE at 17, 19.

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Where, as here, there is no clear agreement between the parties, there is a legal

presumption that the manufacturer, in this case Applicant, owns the mark.

UVeritech, Inc. v. Amax Lighting, Inc., 115 USPQ2d 1242, 1245-46, 1249 (TTAB 2015)

(applying presumption where there was no written agreement and a dispute about

whether there was an oral agreement). This presumption, however, may be rebutted.

Id. In determining which party has superior rights, we consider the following factors,

none of which alone is dispositive:

(1) which party created and first affixed the mark to the product;

(2) which party’s name appeared with the trademark on packaging and

promotional materials;

(3) which party maintained the quality and uniformity of the product, including

technical changes;

(4) which party does the consuming public believe stands behind the product, e.g.,

to whom customers direct complaints and turn to for correction of defective

products;

(5) which party paid for advertising; and

(6) what a party represents to others about the source or origin of the product.

Id.

The first factor favors Applicant as Applicant created the mark and affixed it to

the product.74 As to the second factor, both parties’ names appeared on the packaging,

but Applicant was identified as the manufacturer, signaling to consumers that

Applicant was responsible for the quality of the product. Accordingly, the second

74 Rossana Arras Discovery Deposition, 70 TTABVUE 10-11; Sergio Arras Declaration, 53

TTABVUE 3, ¶ 7.

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factor slightly favors Applicant.75 Applicant created the product formula and

maintained the quality and uniformity of the product so the third factor also favors

Applicant.76 Indeed, Opposer was not privy to Applicant’s product formulation.77 The

fourth and fifth factors favor Opposer as consumers directed complaints and inquiries

to Opposer78 and Opposer paid for advertising EUCALIN products in the United

States.79 Lastly, as noted, the product packaging identified Applicant as the

manufacturing entity that stood behind the goods as the source of origin.80

Accordingly, the sixth factor also favors Applicant.

In sum, the first, second, third and sixth factors favor Applicant as Applicant

created the mark and product, maintained quality control over the product, and was

identified on product packaging as the manufacturer of the goods. The fourth and

fifth factors favor Opposer as Opposer’s telephone number and website address were

provided on product packaging for consumer inquiries and Opposer paid for

advertising the products. On balance, the factors favor Applicant. Accordingly,

Opposer has not rebutted the presumption that Opposer’s use of the mark from 1999

to October 2, 2008 inured to the benefit of Applicant as the owner of the mark.81

75 Sergio Arras Declaration, 53 TTABVUE 4, ¶ 15. No promotional materials are of record so

we do not know which party’s name appeared with the trademark on promotional materials.

76 Rossana Arras Discovery Deposition, 70 TTABVUE 10-11; Sergio Arras Declaration, 53

TTABVUE 3, ¶¶ 7, 12.

77 Sergio Arras Declaration, 53 TTABVUE 5, ¶ 19.

78 Id. at 4, ¶ 15.

79 Medrano Declaration, 56 TTABVUE 3, ¶ 5.

80 Sergio Arras Declaration, 53 TTABVUE 4, ¶ 15.

81Opposer argues that between 1999 to 2008, Applicant filed several U.S. trademark

applications for EUCALIN and EUCALIN-formative marks and “[h]ad Salud believed that

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2. Abandonment

We now consider whether Applicant abandoned its rights in the EUCALIN mark

through nonuse.82

There are two elements to a nonuse abandonment claim: nonuse of the mark and

intent not to resume use. 15 U.S.C. § 1127; Exec. Coach Builders, 123 USPQ2d at

1180. Evidence of nonuse of a mark for three consecutive years constitutes a prima

facie showing of abandonment, and creates a rebuttable presumption that the owner

Arsa’s sales of EUCALIN products inured to its benefit, it would have filed use-based

applications and/or allegations or statements of use. It did not, and instead allowed each of

these applications to go abandoned.” Opposer’s Brief, 75 TTABVUE 18-19. This argument is

unpersuasive.

The Trademark Act permits an entity to seek registration under Section 1(b) of the

Trademark Act, 15 U.S.C. § 1051(b), even if the mark is in use. Moreover, registration of a

mark is not required to establish ownership. Cf. Crash Dummy Movie, LLC v. Mattel, Inc.,

601 F.3d 1387, 94 USPQ2d 1315, 1317 (Fed. Cir. 2010) (“Although Mattel later allowed its

trademark registrations to lapse, cancellation of a trademark registration does not

necessarily translate into abandonment of common law trademark rights.”).

82Applicant’s argument that Opposer has not pleaded abandonment as a ground for

opposition is misplaced. Applicant’s Brief, 77 TTABVUE 32. Neither of Applicant’s

applications are based on use so abandonment is not an available claim. See Imperial Tobacco

Ltd. v. Philip Morris Inc., 899 F.2d 1575, 14 USPQ2d 1390, 1395 (Fed. Cir. 1990) (a mark

subject to an application filed under Section 44 of the Trademark Act is not vulnerable to an

abandonment challenge until the mark registers); Consolidated Cigar Corp. v. Rodriguez, 65

USPQ2d 1153, 1155 (TTAB 2002) (a claim of abandonment cannot arise with respect to a

Section 1(b) application until after an allegation of use is filed).

Whether Applicant abandoned the EUCALIN mark is part of the priority analysis under the

ground of likelihood of confusion. If Applicant had prior common law rights but abandoned

the mark, the earliest dates it may rely on for priority are the filing dates of its applications.

Applicant was on notice that Opposer would raise abandonment as a challenge to any

assertion by Applicant of prior common law rights. See ’700 Opposition, Notice of Opposition,

1 TTABVUE 7, ¶ 35 (“ARSA’s EUCALIN mark has priority over the proposed EUCALIN

mark of Salud as Salud was expressly prohibited from selling any products in and into the

United States beginning in or around October 2008 and at least until May 22, 2015.”); ’240

Opposition, Notice of Opposition, 1 TTABVUE 4, ¶ 17 (“ARSA’s EUCALIN mark has priority

over the proposed EUCALIN mark of Salud as Salud was expressly prohibited from selling

any products in and to the United States beginning in or around October 2008.”).

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has abandoned the mark without intent to resume use. 15 U.S.C. § 1127; Exec. Coach

Builders, 123 USPQ2d at 1180; Rivard v. Linville, 133 F.3d 1446, 45 USPQ2d 1374,

1376 (Fed. Cir. 1998). The statutory presumption of abandonment applies not only to

a registered mark but also to a party’s unregistered common law mark. Hornby v.

TJX Cos., 87 USPQ2d 1411, 1421 (TTAB 2008).

If the party alleging abandonment makes a prima facie case of abandonment, the

burden of production, (i.e., going forward), shifts to the party contesting the

abandonment “to produce evidence that it has either used the mark or that it has

intended to resume use.” Azeka Bldg. Corp. v. Azeka, 122 USPQ2d 1477, 1485 (TTAB

2017); see also On-Line Careline, Inc. v. Am. Online, Inc., 229 F.3d 1080, 56 USPQ2d

1471, 1476 (Fed. Cir. 2000) (same). The burden of persuasion, however, always

remains with the party asserting abandonment to prove it, by a preponderance of the

evidence. Exec. Coach Builders, 123 USPQ2d at 1180-81 (citing Cerveceria

Centroamericana S.A. v. Cerveceria India Inc., 892 F.2d 1021, 13 USPQ2d 1307, 1309

(Fed. Cir. 1989)).

There is no dispute that Applicant has not used the EUCALIN mark in the United

States since October 2, 2008 when it was prohibited from conducting business in the

United States as a sanction.83 Accordingly, although Opposer focused on the three

83 Notice of Opposition, ’700 Opposition, 1 TTABVUE 6, ¶ 25; Answer, ’700 Opposition, 4

TTABVUE 4, ¶ 25 (admitting that “[f]ollowing the Kingpin Act sanction beginning in or

around October 2008 and until May 22, 2015, Salud did not sell or distribute any products in

the United States.”); see also 51 TTABVUE 101 (admitting Request for Admission 14 that

“Applicant did not sell any EUCALIN-branded products into the United States between

October 2008 and May 22, 2015, either directly or through a distributor.”); id. at 107

(responding to Interrogatory No. 3 that Applicant has not sold EUCALIN-products in the

U.S. since October 2, 2008).

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year period between October 2, 2008 and October 2, 2011, Opposer has established a

prima facie case of abandonment based on any three-year period of consecutive

nonuse since October 2, 2008. The burden therefore shifts to Applicant to produce

evidence of an intent to resume use.84

Applicant “must put forth evidence with respect to what activities it engaged in

during the nonuse period or what outside events occurred from which an intent to

resume use during the nonuse period may reasonably be inferred.” Imperial

Tobacco, 14 USPQ2d at 1394-95; Double Coin Holdings Ltd. v. Tru Dev.,

2019 USPQ2d 377409, at *15 (TTAB 2019) (Board examines efforts during the period

of nonuse); Yazhong Investing Ltd. v. Multi-Media Tech Ventures, Ltd., 126 USPQ2d

1526, 1538 (TTAB 2018). The Board may consider evidence regarding activities that

occurred before or after the three-year period of nonuse to infer intent to resume use

84 We give no consideration to Applicant’s argument that Opposer’s continued use of the

EUCALIN mark in the U.S. during the nonuse period inured to Applicant’s benefit such that

Applicant could overcome the presumption of abandonment based on nonuse. In response to

a request for admission, Applicant admitted that it “did not sell any EUCALIN-branded

products into the United States between October 2008 and May 22, 2015, either directly or

through a distributor.” 51 TTABVUE 101, Admission to Request for Admission 14

(emphasis added); see also id. at 107, Response to Interrogatory No. 3.

We add that even if Applicant had not made this admission, we could not recognize sales of

EUCALIN-branded products in or to the United States during the OFAC sanctions period as

inuring to Applicant’s benefit because sales for Applicant’s benefit during that period were

prohibited under the Kingpin Act. 21 U.S.C. § 1904(c) (prohibiting “any transaction or dealing

. . . within the United States, in property or interests in property of any” SDNT); see also

Clorox Co. v. Armour-Dial, Inc., 214 USPQ 850, 851 (TTAB 1982) (“It has been the consistent

position of this Board and the policy of the Patent and Trademark Office that a ‘use in

commerce’ means a ‘lawful use in commerce,’ and the shipment of goods [unlawfully] may not

be recognized as the basis for establishing trademark rights.”). The record does not contain

any evidence of an exception to engage in transactions prohibited by the Kingpin Act for

Applicant or Opposer, if Opposer could be considered Applicant’s distributor during the

period the OFAC sanctions were in effect.

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during the three-year period. Exec. Coach Builders, 123 USPQ2d at 1199 (citing

Crash Dummy Movie, 94 USPQ2d at 1317).

“Intent to resume use in abandonment cases has been equated with a showing of

special circumstances that excuse nonuse.” Exec. Coach Builders, 123 USPQ2d at

1198. If a mark owner’s nonuse is excusable, it has overcome the presumption that

its nonuse was coupled with an intent not to resume use; if the activities are

insufficient to excuse nonuse, the presumption is not overcome.85 Id.; see also Imperial

Tobacco, 14 USPQ2d at 1395.

A mark owner must show that, “under [its] particular circumstances, [its]

activities are those that a reasonable business[], [that] had a bona fide intent to use

the mark in United States commerce, would have undertaken.” Executive Coach

Builders, 123 USPQ2d at 1198; see also Imperial Tobacco, 14 USPQ2d at 1395.

The intent must be to resume use of the mark within the reasonably foreseeable

future once the reason for suspension abates. Hornby, 87 USPQ2d at 1422 (“A

proprietor who temporarily suspends use of a mark can rebut the presumption of

abandonment by showing reasonable grounds for the suspension and plans to resume

85 In Double Coin, the defendant asserted that it was “unreasonable” for the plaintiff to have

ceased use of its mark because of the imposition of a tariff on its goods. We explained: “Our

task is not to determine whether Double Coin’s decision to discontinue sales in the United

States in response to the imposition of tariffs, in-and-of-itself, was ‘excusable,’ that is, a

reasonable business judgment under the circumstances. That is not what the statute requires

us to do. Rather, as noted above, we must examine the activities that Double Coin engaged

in during the period following cessation of use to determine whether we may infer from those

circumstances an intent not to resume use.” 2019 USPQ2d 377409, at *14-15. While we do

not consider the reasonableness of a business decision to cease use of a mark by itself, the

reason for the cessation of use may be relevant to whether there are “special circumstances”

that excuse the nonuse or whether use was discontinued with the intent not to resume use.

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use in the reasonably foreseeable future when the conditions requiring suspension

abate.”) (quoting Silverman v. CBS Inc., 870 F.2d 40, 9 USPQ2d 1778, 1783 (2d Cir.

1989); see also Azeka Building, 122 USPQ2d at 1487 (“Once the challenger shows

discontinued use, the owner must produce evidence of intent to resume use within

the reasonably foreseeable future.”) (internal quotation marks omitted); J. Thomas

McCarthy, 3 MCCARTHY ON TRADEMARKS AND UNFAIR COMPETITION § 17:16 (5th ed.

Sept. 2002 update) (“[A]s soon as the external cause has passed, the user must resume

use within a reasonable time.”). “[W]hat is meant by the ‘reasonably foreseeable

future’ will vary depending on the industry and the particular circumstances of the

case[.]” Azeka Building, 122 USPQ2d at 1487 (quoting Emergency One Inc. v. Am.

FireEagle Ltd., 228 F.3d 531, 56 USPQ2d 1343, 1348 (4th Cir. 2000)).

Opposer argues:

Salud failed to produce any testimony or documentation establishing

that Salud had concrete plans … of intent to resume use between 2008

and 2015 … and indeed it could not as it was legally banned from

conducting business in the United States until May 2015[.]… Thus, even

if Salud … ever had rights in the United States – which Arsa denies –

such rights were abandoned as Salud proffers no evidence of an intent

to resume commercial use in the United States within the three-year

period of non-use between October 2, 2008 and October 2, 2011. At that

time, the ECUALIN mark “reverts back to the public domain whereupon

it may be appropriated by anyone who adopts the mark for his or her

own use.”86

Applicant asserts that “the ban from conducting business in the United States as

a sanction” constitutes “an excusable non-use.”87 Applicant further argues that it

86 Opposer’s Brief, 75 TTABVUE 23 (quoting Dial-A-Mattress Operating Corp. v. Mattress

Madness, Inc., 841 F. Supp. 1339, 1355 (E.D.N.Y. 1994)).

87 Applicant’s Brief, 77 TTABVUE 32.

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maintained an intent to resume use of the mark as shown by: (1) the application it

filed for the standard character mark EUCALIN on October 6, 2015 “as soon as

Applicant was allowed to do business in the United States”; (2) the infringement

actions it filed in Mexico against the two companies supplying Opposer’s U.S.

EUCALIN products; and (3) the petition to cancel that it filed against Opposer’s now-

cancelled registration for the mark EUCALIN.88

This is not a case where Applicant decided to cease use of its mark for business

reasons. Rather, Applicant had no choice but to cease use of its mark because its use

was prohibited by government sanctions banning it from doing business in the United

States for the period it was identified as a SDNT.

Abandonment generally “does not result from a mere temporary withdrawal from

the market forced by outside causes (‘excusable nonuse’)[.]”Miller Brewing Co. v.

Oland’s Breweries (1971) Ltd., 548 F.2d 349, 192 USPQ 266, 267 (CCPA 1976); see

also, e.g., P.A.B. Produits Et Appareils de Beaute v. Satinine SNC di S.A. e. M.

Usellini, 570 F.2d 328, 196 USPQ 801, 806 (CCPA 1978) (“[T]he inference of

abandonment is readily rebutted by a showing that such nonuse was due

to special circumstances which excuse the same and not due to any intention to

abandon the mark.” ); Am. Lava Corp. v. Multronics, Inc., 461 F.2d 836, 174 USPQ

107 (CCPA 1972) (circumstances including litigation and Vietnam War excused

nonuse); Sterling Brewers, Inc. v. Schenley Indus. Inc., 441 F.2d 675, 169 USPQ 590,

593 (CCPA 1971) (closing of brewery was excusable because it “was the result of a

88 Applicant’s Brief 77 TTABVUE 24-25 (redacted); 76 TTABVUE 24-25 (confidential).

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strike and not a voluntary act by [the mark owner]”); Kelly Liquor Co. v. Nat’l

Brokerage Co., 102 F.2d 857, 41 USPQ 311, 314 (CCPA 1939) (“the fact that, while

prohibition was in force, said trade-mark was not used, did not constitute an

abandonment of the same”); see also In re Moorman Mfg. Co., 203 USPQ 712, 714

(Comm’r Pat. 1979) (discussing excusable nonuse in the context of a Section 8

affidavit: “[I]t appears fairly clear that in situations where nonuse is compulsory,

such as was the case during the era of prohibition of the sale of liquor, no intention

to abandon use of a mark may be presumed from nonuse during the period of such

prohibition.”).89

In addition, soon after the sanctions were lifted on May 15, 2015, and it became

legally permissible for Applicant to resume use of the EUCALIN mark and otherwise

conduct business in the United States, Applicant took steps evidencing an intent to

resume use of the mark in the United States. Executive Coach Builders, 123 USPQ2d

at 1199 (the Board may consider evidence regarding activities that occurred after the

statutory three-year period of nonuse) (citing Crash Dummy Movie, 94 USPQ2d at

1317). Specifically, within five months of the sanctions being lifted, Applicant filed a

U.S. application for the mark EUCALIN (on October 6, 2015).90 Applicant also took

steps to remove Opposer as an obstacle to its re-entry into the U.S. market, filing (on

89 Although the Moorman case dealt with a maintenance filing, it is still pertinent as the

Federal Circuit has explained that “a showing of special circumstances which excuses a

registrant’s nonuse [in the context of an abandonment claim]… is the same type of showing

required in Sections 8 and 9 with respect to declarations of continued use for maintenance

and renewal.” Imperial Tobacco, 14 USPQ2d at 1395 and n.10.

90 Involved application Serial No. 86779422.

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July 14, 2016) a petition to cancel Opposer’s U.S. registration for the EUCALIN mark

that Opposer had obtained during Applicant’s compulsory period of nonuse.91

During the same time frame, Applicant filed in Mexico petitions for infringement

against the Mexican entities supplying Opposer’s U.S. EUCALIN products. 92 The

IMPI found that the entities were infringing Applicant’s Mexican rights in the

EUCALIN mark and ordered each entity “to abstain from using the EUCALIN

denomination on the products it sells.”93 These were the only entities supplying

Opposer products to sell under the EUCALIN mark in the United States.94

Accordingly, the Mexican actions directly affected Opposer’s ability to sell EUCALIN

products in the United States. Even though these proceedings took place outside the

United States, they demonstrate Applicant’s efforts to eliminate or disrupt the supply

of Opposer’s EUCALIN products in an effort to remove Opposer as an obstacle to

Applicant resuming use of the EUCALIN mark in the United States.

Based on these activities, taken soon after sanctions were lifted, and the fact that

Applicant’s nonuse was a result of being prohibited from use during a specific time

91 59 TTABVUE 4-5.

92 60 TTABVUE; 61 TTABVUE.

The images of the infringing products displayed in the IMPI opinions are substantially

similar to the photograph of the EUCALIN product Opposer filed as a specimen in support

of its now-cancelled EUCALIN registration. Compare 60 TTABVUE 10 and 61 TTABVUE 11

with 15 TTABVUE 15.

93 60 TTABVUE 31; 61 TTABVUE 30.

94 64 TTABVUE 6-7 (confidential).

To be clear, while any rights Applicant may have in the EUCALIN mark in Mexico are not

relevant to the issue of priority in the United States, the actions Applicant took at the IMPI

are relevant for the reason stated.

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period resulting from the OFAC-imposed sanctions, we find that Applicant

maintained an intent to resume use of the EUCALIN mark during its period of

compulsory nonuse and beyond.

Opposer argues the fact that Applicant has not yet resumed sales of EUCALIN

products in the United States nearly seven years after the sanctions were lifted

demonstrates that Applicant did not maintain an intent to resume use in the

reasonably foreseeable future.95 This argument is unpersuasive.

Since July 14, 2016, just over one year after the sanctions against Applicant were

lifted, the parties have been involved in litigation before the Board regarding the

EUCALIN mark in the U.S.96 Applicant’s vigorous defense of the oppositions supports

a finding that Applicant has maintained an intent to resume use of the EUCALIN

mark throughout the parties’ litigation. Penthouse Int’l, Ltd. v. Dyn Elecs., Inc., 196

USPQ 251, 257 (TTAB 1977) (finding applicant’s efforts to defend opposition

evidenced an intent not to abandon the mark). We further find that Applicant’s

nonuse during the pending dispute between the parties over ownership of the

EUCALIN mark in the United States constitutes excusable nonuse negating the

inference of abandonment. Penthouse, 196 USPQ at 257 (“Nonuse of a mark pending

the outcome of litigation to determine the right to such use or pending the outcome

95 Opposer’s Brief, 75 TTABVUE 23-24.

96 Although Opposer’s U.S. registration for the EUCALIN mark was cancelled on February

1, 2017 for failure to file a Section 8 declaration, Applicant’s petition to cancel the

registration, filed July 14, 2016, was not dismissed until June 22, 2018. 59 TTABVUE 4; 62

TTABVUE 4. In the interim, Opposer filed the first of these consolidated oppositions on

March 22, 2018.

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Opposition No. 91240240 (parent)

Opposition No. 91243700

of a party’s protest to such use constitutes excusable nonuse sufficient to overcome

any inference of abandonment.”); see also Imperial Tobacco, 14 USPQ2d at 1395

(“[T]he Board recognized that suspension of actual use, or plans to use a mark

pending resolution of litigation, may serve to justify nonuse[.]”).

In sum, taken together, the circumstances here are sufficient to overcome the

presumption that Applicant abandoned the EUCALIN mark for “dietary and

nutritional supplements.” Applicant’s nonuse of the mark from October 2, 2008 to

May 22, 2015 was due to government sanctions prohibiting it from doing business in

the United States while Applicant was a SDNT. Within a reasonable time after the

sanctions were lifted, Applicant filed the application for the standard character mark

at issue in this proceeding and started taking steps to remove Opposer as an obstacle

to its resumption of use in the United States, evidencing an intent to resume use in

the reasonably foreseeable future after the sanctions were lifted. The parties’

litigation before the Board concerning ownership of the EUCALIN mark in the U.S.

constitutes a basis for further excusable nonuse.

In view of the foregoing, we find that Opposer has failed to prove that Applicant

abandoned the EUCALIN mark with an intent not to resume use.

Priority Determination

As discussed above, Opposer’s use of the EUCALIN mark in the United States

from 1999 to October 2, 2008 inured to Applicant’s benefit as the manufacturer of the

goods and Applicant has rebutted the presumption that it abandoned the mark after

October 2, 2008. Accordingly, we find that Applicant owns common law rights in the

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Opposition No. 91240240 (parent)

Opposition No. 91243700

United States for the mark for “dietary and nutritional

supplements” since 1999. The earliest date on which Opposer can rely for priority is

late 2008 when it started selling EUCALIN “dietary and nutritional supplements”

manufactured by a third party.

Because Opposer’s first use date is after Applicant’s first use date, Opposer has

failed to prove priority as necessary to prevail on its Section 2(d) claim.97

IV. Requirement that Opposer File Partially Redacted Responses to

Applicant’s Interrogatory Nos. 1 and 2

Pursuant to Section I.B above, Opposer is allowed until thirty days from the date

of this decision to file with the Board and serve on Applicant a redacted version of its

responses to Interrogatory Nos. 1 and 2 in which the following information is

nonredacted: the entities that “ha[ve] produced products” for Opposer before 2017,

and the entities “that originally … produced the syrup with the packaging and labels”

for Opposer, failing which 64 TTABVUE (which is currently confidential) may be re-

designated public in its entirety. Kohler Co. v. Honda Giken Kogyo K.K., 125 USPQ2d

1468, 1476 n.19 (TTAB 2017).

V. Decision

The oppositions are dismissed because Opposer has failed to establish priority in

its pleaded EUCALIN mark.

97 In view thereof, Applicant’s affirmative defense of unclean hands in the ’240 Opposition is

moot.

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