Use in Commerce

 
 

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The use of the mark must be one that identifies the source of the good. 

Source Identifying

For goods, the mark must be placed on the good, its container, displays, or labels on the good. If those options are impracticable, the mark must be placed on documents associated with the good. For services, the mark must be used or displayed in the sale or advertising of the services, and the services must be rendered in commerce.

Physical Placement

The first person to use a distinctive mark in commerce gains rights to the mark.  The term "use in commerce" means "the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark."

Requirements for Protection
Actual Commerce

The use of the mark must be in the manner that the mark owner intends to use the mark in the actual commercial context. The mark must be used in the mark owner’s sale, offer to sell, or renting of the good or service. Goods must actually be sold or transported in commerce; services must be actually rendered in commerce.

The use in commerce must be a use that affects interstate commerce. Activity that might affect interstate commerce is sufficient (even in the absence of any good or service that crosses state lines). If there is a possibility that sales might occur out of state (e.g., through the internet), the interstate commerce requirement is satisfied.

Interstate

If a mark owner stops using the mark in commerce, the mark owner loses her rights in the mark.  Abandonment occurs.

Loss of Protection
Abandonment

Abandonment is the voluntary, irrevocable termination of rights. Two elements must be present for abandonment: (1) intent and (2) non-use. Intent consists of an intent to irrevocably relinquish rights to the mark. Non-use consists of a failure to make a use in commerce

Non-use for three consecutive years is prima facie evidence of abandonment. If a defendant produces this prima facie evidence, the mark owner then has a burden to establish that he did not intend to abandon the mark or that he did actually make a use in commerce during the period in question.  In establishing intent, the mark owner must show that he had an intent to resume use within the reasonably foreseeable future.

Presumption

Answer to Question 3

No. Chuck must place the TREGALIA mark on the clock in order to use TREGALIA in commerce. (The nature of a clock does not preclude placement of the mark on the good itself.)

Practice Problems

Question 1

Marge creates a fanciful mark, MEUK, to sell a line of perfume that she is developing. Although her perfume is not ready to sell at that time, she goes ahead and advertises the MEUK line extensively using billboards, television commercials, and online ads. Through her advertising, Marge has created substantial market demand for MEUK perfume, even without having sold any perfume (which she continues to develop). In the absence of any actual perfume sold under the name of MEUK by Marge, Kevin decides to sell his own line of perfume under the MEUK name. A year after Kevin has sold MEUK perfume (capitalizing on the demand that Marge has created for MEUK perfume), Marge starts selling perfume under the name of MEUK.
 

Question: Assuming that Marge and Kevin both sell MEUK in the same geographic area, who has superior rights to the MEUK mark?

Question 2

JCheating Computer Geeks Inc. (CCGI) has learned that its competitor, MicroHard, has developed a new line of computer. Through business gossip, CCGI executives have also learned that the name for the new MicroHard computer line will be THE JYMER. Suspecting that MicroHard has invested much into preparing the JYMER name for public announcement, CCGI executives decide to use the JYMER name in commerce to preempt MicroHard from using it. Hence, CCGI labels one of its older computers that it sells as the JYMER computer, intending to develop a new computer with the JYMER name in the future.


Question: Has CCGI made a use in commerce of the JYMER mark?

Question 3

Chuck sells wall clocks. He vends his clocks at a local flee market under the fanciful name, TREGALIA CLOCKS. However, he does not place the TREGALIA mark anywhere on the clock. Instead, Chuck orally represents to his customers that they are buying a TREGALIA clock.
 

Question: Has Chuck made a use in commerce of the TREGALIA mark?

Question 4

For ten years, Sarah used the mark SARAH’S BUSINESS SOLUTIONS to market her consulting business. She has well established secondary meaning for the mark. She is not happy with the mark, however, because it suggests to potential clients that her business helps only if a business has encountered a problem. Hence, in an attempt to change consumer perception of her business, Sarah changes her business name to IDEAS FOR COMMERCIAL SUCCESS. She operates her business under this new name for three years, not using her former name.
 

Sarah does plan to bring back the SARAH’S BUSINESS SOLUTIONS name sometime in the future, perhaps once she grows large enough to have a separate business that focuses only on solving problems. Sarah, however, hasn’t made any definitive plans at to when she will use SARAH’S BUSINESS SOLUTIONS again. Regardless, there is strong secondary meaning established around that mark.
 

Sarah’s competitor, Abe, sees an opportunity. Now that Sarah is not using SARAH’S BUSINESS SOLUTIONS, and given the positive reputation and goodwill that consumers associate with that mark, Abe decides to market his consulting business with that mark.
 

Question: Does Sarah have rights to the SARAH’S BUSINESS SOLUTIONS mark superior to any rights that Abe asserts?

Answers

Answer to Question 2

No. CCGI’s use is not a bona fide use in trade. CCGI’s use is a token use—a use that CCGI makes merely to reserve a mark for future uses.

Answer to Question 1

Kevin. Marge fails to make an actual use in commerce of the MEUK mark prior to Kevin. Despite Marge’s extensive advertising, she fails to offer the perfume for sale under the MEUK name until after Kevin has done so. Kevin is the first person to make a use in commerce by selling perfume under the MEUK mark.

Answer to Question 4

Likely not. Because Sarah has not used the mark in commerce for three years, there is a legal presumption of abandonment. She must demonstrate an intent to resume use within the reasonably foreseeable future. Sarah’s desire to someday resume use is not definite enough to constitute the required intent to resume use.