In Re Bose: Good News for Trademark Owners

A trademark application whose Statement of Use incorrectly lists mark-bearing goods by overstating the types of goods being sold in commerce can no longer be cancelled for fraud unless there is substantial evidence that the applicant "intended to deceive the PTO". In Re Bose Corp., --- F.3d ----, 2009 WL 2709312 (C.A.Fed.8/31/2009). No longer will simple negligence be enough to cancel an entire registration. No longer will the fact that an applicant "should have known" certain described goods were not being distributed in commerce be enough to invalidate the entire registration. Now, there must be a showing that the applicant wilfully intended to deceive the PTO.

In Bose, the corporation's general counsel signed a Section 8/9 renewal claiming the "Wave" mark was still in use in commerce on various goods, including audio tape recorders and players. Counsel knew that Bose no longer sold tape players, but believed that, because some warranty repairs were ongoing and the goods would be shipped back to the consumers after repair (thus entering "commerce), it would be appropriate to claim "use in commerce". Bose subsequently got into a trademark dispute with Hexawave, Inc., and Hexawave attacked the trademark. The Trademark Trial and Appeal Board found fraud and cancelled the trademark. The Federal Circuit this week overturned that decision.

We can expect cases in the future that solidify and expand this decision. For instance, while an applicant who mistakenly overstates the array of goods being sold will not have grounds to claim protection if a competitor begins distributing goods from the overstated category, competing within the arena of actually-produced goods will be scrutinized for trademark infringement. And the loophole that cancelled registrations where there was an overstatement of the array of goods will no longer exist.