Joseph Phelps Vineyards, LLC v. Fairmont Holdings, LLC , 857 F.3d 1323 ( 2017 )

United States Court of Appeals
for the Federal Circuit
______________________
JOSEPH PHELPS VINEYARDS, LLC,
Appellant
v.
FAIRMONT HOLDINGS, LLC,
Appellee
______________________
2016-1089
______________________
Appeal from the United States Patent and Trademark
Office, Trademark Trial and Appeal Board in No.
92057240.
______________________
Decided: May 24, 2017
______________________
THOMAS SCHNECK, Law Offices of Thomas Schneck,
San Jose, CA, for appellant.
KIMBERLY KOLBACK, Law Office of Kimberly Kolback,
Miami, FL, for appellee. Also represented by MIRIAM
RICHTER, Richter Trademarks, PL, Wilton Manors, FL.
______________________
Before NEWMAN, DYK, and WALLACH, Circuit Judges.
Opinion for the court filed Per Curiam.
2 JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC
Concurring opinion filed by Circuit Judge NEWMAN.
PER CURIAM.
Joseph Phelps Vineyards, LLC (“Vineyards”) has pro-
duced and sold wines bearing the trademark INSIGNIA
since 1978. In 2012, Fairmont Holdings, LLC (“Fair-
mont”) received federal registration for the mark ALEC
BRADLEY STAR INSIGNIA for cigars and cigar prod-
ucts. On Vineyards’ petition for cancellation, the Trade-
mark Trial and Appeal Board (“Board” or “TTAB”) denied
the petition, 1 stating the finding that:
while it appears that Petitioner’s INSIGNIA
branded wine has met with success in the mar-
ketplace, we are not persuaded on this record that
Petitioner’s mark is a famous mark.
TTAB Op. at 8.
The TTAB found that Vineyards’ INSIGNIA mark is
not a “famous” mark and gave this factor no weight. The
TTAB erred in its legal analysis, in analyzing the “fame”
of INSIGNIA wine as an all-or-nothing factor, and dis-
counting it entirely in reaching the conclusion of no
likelihood of confusion as to source, contrary to law and
precedent. As a result of this error, the Board did not
properly apply the totality of the circumstances standard,
which requires considering all the relevant factors on a
scale appropriate to their merits. We vacate the Board’s
decision and remand for redetermination of the merits of
the cancellation petition.
1 Joseph Phelps Vineyards, LLC v. Fairmont Hold-
ings, Cancellation No. 92057240 (TTAB July 6, 2015)
(“TTAB Op.”).
JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC 3
THE FACTOR OF “FAME”
The TTAB acknowledged: “Fame for confusion pur-
poses arises as long as a significant portion of the relevant
consuming public . . . recognizes the mark as a source
indicator,” citing Palm Bay Imports, Inc. v. Veuve Clicquot
Ponsardin Maison Fondee en 1772, 396 F.3d 1369, 1374–
75 (Fed. Cir. 2005) (“[T]he proper legal standard for
evaluating the fame of a mark under the fifth DuPont
factor is the class of customers and potential customers of
a product or service, and not the general public.”).
The TTAB applied a legally incorrect standard in ap-
plying an all-or-nothing measure of “fame,” more akin to
dilution analysis. “While dilution fame is an either/or
proposition—fame either does or does not exist—
likelihood of confusion fame ‘varies along a spectrum from
very strong to very weak.’” Id. (quoting In re Coors Brew-
ing Co., 343 F.3d 1340, 1344 (Fed. Cir. 2003)). In exami-
nation of INSIGNIA’s fame, the applicable viewpoint is
that of the relevant market. Id. (“[A] mark’s renown
within a specific product market is the proper standard.”).
Vineyards provided evidence that INSIGNIA wine is
renowned in the wine market and among consumers of
fine wine. The record shows extensive recognition and
accolade for INSIGNIA brand wine. Vineyards’
INSIGNIA wines were selected as Wine of the Year in
2005 and 1997, with Wine Spectator noting that
INSIGNIA wine had by 2005 earned an outstanding score
in 26 of its 29 vintages and repeatedly ranked as a “clas-
sic,” scoring between 95 and 100 points. J.A. 62. Follow-
ing is a selection from the exhibits presented to the TTAB
with the testimony of Joseph Phelps:
• FOOD AND WINE, October 2011, at 150-152:
“INSIGNIA was the first Bordeaux blend pro-
duced in Napa Valley . . . and it’s still one of the
most famous. (It’s also one of the best.).” (J.A. 82–
83).
4 JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC
• WALL ST. J., March 16, 2012: “Favorite Vintage:
1994 Phelps INSIGNIA, $70 on release. A full-
bodied, generous, gorgeous wine that manages to
taste youthful as well.” (J.A. 79–81).
• THE CAPITAL, February 1, 2012: “Joseph Phelps
Napa Valley INSIGNIA 2008 ($200) -- From one of
the most respected producers in the Napa Valley,
this colossal blend . . . is a wine that will last for
decades.” (J.A. 87–88).
• WASH. POST, February 24, 1999: “[T]his has to
be INSIGNIA, because when l love a Cabernet
and don't know what it is, I always guess my be-
loved INSIGNIA.” (J.A. 73).
• BALT. SUN, April 14, 1996: Fireworks explode at
tasting for ’94 Joseph Phelps INSIGNIA, “But
even amid the abundance of excellent wines on
show at the MacArthur tasting, the INSIGNIA
stood out . . . . In more than a decade of attending
MacArthur barrel tastings, this was the finest
wine I had ever encountered.” (J.A. 74).
• VALLEY TIMES, March 8, 2000: “The granddaddy
of these so-called proprietary wines is INSIGNIA,
introduced by Joseph Phelps Vineyards with the
1974 vintage.” (J.A. 75).
• CALIFORNIA GRAPEVINE, Vol. 35, No. 5, p. 65, Oc-
tober-November 2009, at 65: “2006 Joseph Phelps
INSIGNIA . . . Very highly recommended. My
score 92/100, first place.” (J.A. 90).
• QUARTERLY REV. OF WINES, Winter 2009/2010,
at 75: “1st Place: Phelps INSIGNIA . . . it’s a per-
ennial winner at our annual Best of the Best in
California.” (J.A. 92).
The record shows INSIGNIA wine served at the White
House:
JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC 5
• The White House dinner menu honoring the
Prime Minister of Canada, March 14, 2002
(Phelps INSIGNIA 1994). (J.A. 65).
• The White House Holiday dinner menu dated
December 1, 2006 (Joseph Phelps INSIGNIA
2002). (J.A. 66).
• President’s Invitation to a dinner honoring The
Governors of the States and Territories dated
February 22, 1998 (Phelps INSIGNIA 1994). (J.A.
69–70).
The record contains many more examples. We are per-
plexed at the Board’s finding that INSIGNIA wine has no
“fame,” giving no discernable weight to this factor. The
TTAB applied an incorrect standard, for “fame” is deter-
mined from the viewpoint of consumers of like products.
The record shows appreciation by consumers and the wine
market of Vineyards’ INSIGNIA brand. It was error to
refuse to accord any “fame” to Vineyards’ INSIGNIA
mark. The factor of “fame” warrants reasonable weight,
among the totality of the circumstances.
CONCLUSION
We vacate the decision of the TTAB solely on the basis
that the Board used an incorrect standard for fame and
remand for determination of the cancellation petition
utilizing the correct standard.
VACATED AND REMANDED
Each party shall bear its costs.
United States Court of Appeals
for the Federal Circuit
______________________
JOSEPH PHELPS VINEYARDS, LLC,
Appellant
v.
FAIRMONT HOLDINGS, LLC,
Appellee
______________________
2016-1089
______________________
Appeal from the United States Patent and Trademark
Office, Trademark Trial and Appeal Board in No.
92057240.
______________________
NEWMAN, Circuit Judge, concurring.
I agree that the TTAB improperly analyzed the factor
of “fame” and that vacatur and remand are appropriate. I
believe it to be appropriate, also, that Vineyards’ decades
of prior usage should receive its proper weight in this
consideration, beyond the acknowledgement of simple
“priority.” However, my primary purpose in writing
separately is to call attention to two additional issues that
warrant review on remand.
1. The Board, in its analysis of “relatedness,” as the
DuPont factor is called, did not fully consider all aspects
of this factor, despite noting that relatedness can be based
on use together (TTAB Op. 14), complementarity (TTAB
2 JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC
Op. 12), or simultaneous consumption (TTAB Op. 13, 14).
Indeed, the Board found that:
the evidence suggests that the goods are sold in
the same channels of trade to the same purchas-
ers . . . .
TTAB Op. 15, suggesting a degree of relatedness that
requires further exploration on remand.
2. Second, among the factors relevant to the likeli-
hood of confusion analysis, the Board did not include the
form of Fairmont’s actual use of its registered mark.
These factors are part of the totality of the circum-
stances, all of which must be considered, each on a sliding
scale appropriate to its weight and merit. I would include
these aspects in the vacatur and remand, in order to
ensure that the redetermination of the cancellation peti-
tion properly encompasses all relevant factors.
I
ACTUAL USE OF THE REGISTERED MARK
Responding to Vineyards’ argument that in Fair-
mont’s use of ALEC BRADLEY STAR INSIGNIA the
word INSIGNIA is in dominant format, the Board simply
stated that “[b]ecause the depiction of the mark is in
standard character format and Respondent is not limited
to any particular presentation, the format in which Re-
spondent currently uses its mark is not at issue.” TTAB
Op. 9. The Board did not examine the actual use of the
mark. However, as the Tenth Circuit has stated, “[a]
standard character registration does not override the
requirement that likelihood of confusion be measured by
the perceptions of consumers in the marketplace, includ-
ing the effect of packaging.” Hornady Mfg. Co. v. Dou-
bletap, Inc., 746 F.3d 995, 1002 n. 2 (10th Cir. 2014). A
comparison that “present[s] the mark ‘differently from the
way that it actually appears on packaging,’” should be
JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC 3
“rejected.” Id. At a minimum, the appearance and format
is a factor to be given appropriate weight.
The specimens submitted in support of the challenged
registration show the presentation of Fairmont’s mark in
commerce, where ALEC BRADLEY is separated from
STAR INSIGNIA, and the relative sizes of the words
STAR and INSIGNIA are different, as seen in the regis-
tration specimens:
J.A. 195.
The Board described ALEC BRADLEY as a “house
mark” and stated that “[g]enerally, if the product marks
are identical, the addition of the house mark does not
avoid confusion, however, ‘where there are some recog-
nizable differences in the asserted product marks . . . the
addition of a house mark and/or other material to the
assertedly conflicting product mark has been determined
to render the marks as a whole sufficiently distinguisha-
ble,’” TTAB Op. 10, quoting TTAB precedent. The Board
found that because the marks at issue possess “recogniza-
ble differences,” the house mark “does distinguish the
4 JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC
marks.” Id. However, this analysis did not take into
account the actual usage, with separation of ALEC
BRADLEY from STAR and INSIGNIA, in a different font
and size.
The Board erred in declining to consider “illustrations
of the mark as actually used,” for precedent recognizes
that such illustrations “may assist the T.T.A.B. in visual-
izing other forms in which the mark might appear.”
Citigroup Inc. v. Capital City Bank Grp., Inc., 637 F.3d
1344, 1353 (Fed. Cir. 2011). Contrary to the Board’s
assessment, the dominance of the word INSIGNA as used
on Fairmont’s products is indeed an issue. 1 Citigroup
explains that consideration of actual use serves to ensure
the TTAB visualizes the full breadth of a standard char-
acter mark. Id. (“[T]he T.T.A.B. used current and past
commercial displays of the applied-for mark to inform but
not to restrict its analysis of potential displays.”).
To the extent that the actual use of the ALEC
BRADLEY STAR INSIGNIA mark presents a different
impression to the consumer than the standard character
mark viewed in the abstract, the Board should recall that
the likelihood of confusion inquiry is “viewed through the
eyes of a consumer” to determine the commercial impres-
sion of the mark. Duopross Meditech Corp. v. Inviro Med.
Devices, 695 F.3d 1247, 1253–54 (Fed. Cir. 2012).
1 The Fairmont registration states “no claim is
made to the exclusive right to use ‘STAR INSIGNIA’,
apart from the mark as shown.” (J.A. 21). However, “a
disclaimer is irrelevant in determining likelihood of
confusion,” and “disclaimed matter cannot be ignored.” 3
J. McCarthy, Trademarks and Unfair Competition § 19.72
(4th ed. 2014).
JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC 5
Consideration of how the Fairmont registered mark is
actually used, and viewed by the consumer, is part of the
totality of the circumstances of likelihood of confusion and
should be considered on remand.
II
THE “RELATEDNESS” OF THE GOODS
Of course, cigars and wine are different. However, as
noted in Hewlett-Packard Co. v. Packard Press, Inc., 281
F.3d 1261, 1267 (Fed. Cir. 2002), “[e]ven if the
goods . . . are not identical, the consuming public may
perceive them as related enough to cause confusion about
the source or origin.” See In re Shell Oil Co., 992 F.2d
1204, 1207 (Fed. Cir. 1993) (the Board is to “consider the
degree of overlap of consumers exposed to the respective
services, for . . . even when goods or services are not
competitive or intrinsically related, the use of identical
marks can lead to the assumption that there is a common
source”).
The Board treated relatedness as an all-or-nothing
factor, although this factor should be analyzed along a
sliding scale. As stated in DuPont, there is
no warrant, in the statute or elsewhere, for dis-
carding any evidence bearing on the question of
likelihood of confusion. Reasonable men may dif-
fer as to the weight to give specific evidentiary el-
ements in a particular case. In one case it will
indicate that confusion is unlikely; in the next it
will not. . . . In every case turning on likelihood of
confusion, it is the duty of the examiner, the board
and this court to find, upon consideration of all
the evidence, whether or not confusion appears
likely. That determination ends the decisional
process.
In re E. I. DuPont de Nemours & Co., 476 F.2d 1357, 1362
(C.C.P.A. 1973).
6 JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC
As noted supra, the TTAB found that “the evidence
suggests that the goods are sold in the same channels of
trade to the same purchasers.” TTAB Op. at 15. Prece-
dent illustrates the factual sensitivity of the question of
relatedness. In Shell Oil, 992 F.2d at 1207, the court
recognized that “[t]he degree of ‘relatedness’ must be
viewed in the context of all factors, in determining wheth-
er the services are sufficiently related that a reasonable
consumer would be confused as to source or sponsorship.”
In In re Licores Veracruz, S.A. de C. V., Serial No.
77753913 (TTAB January 26, 2012), the TTAB reached a
contrary conclusion on relatedness with respect to rum
and cigars, stating:
in conjunction with the arbitrary nature of the
mark MOCAMBO, we find that cigars and rum
will be encountered by the same consumers under
circumstances that could, because of the identity
of the marks, give rise to the mistaken belief that
they originate from the same source . . . . In view
of the facts that the marks are identical and are a
fanciful or arbitrary term, and the goods are re-
lated, move in the same channels of trade and are
sold to the same consumers, we find that appli-
cant’s mark MOCAMBO for “rum” is likely to
cause confusion with the mark MOCAMBO for
“cigars.”
Id. at 8, 10–11. In the present case, the TTAB relied
on different reasoning: “Thus, the mere fact that two
goods are used together in the same setting or venue does
not, in and of itself, demand a finding that confusion is
likely.” TTAB Op.14 (quoting 4 J. McCarthy, on Trade-
marks and Unfair Competition § 24:26 (4th ed. 2015)).
McCarthy cautions that these are fact-bound determina-
tions and that no fact may “demand” a particular out-
come. However, it devolves on the TTAB to provide
JOSEPH PHELPS VINEYARDS, LLC v. FAIRMONT HOLDINGS, LLC 7
reasonably consistent rulings on similar facts, to provide
premises on which the public can rely.
Here, the Board concluded that wine and cigars are
not “related” because they are products differing in both
composition and method of manufacture. TTAB Op. 14.
However, relatedness is a broad concept; products may
exhibit “relatedness” when they “are complementary
products sold in the same channels of trade to the same
classes of consumers.” See In re Licores Veracruz, supra
(finding that rum and cigars meet the criteria of related-
ness). See also John Walker & Sons Ltd. v. Tampa Cigar
Co., 124 F. Supp. 254, 256 (S.D.Fla. 1954), aff’d 222 F.2d
460 (5th Cir. 1955) (“Whisky and cigars are closely related
in distribution and use.”); Geo. A. Dickel Co. v. Stephano
Bros., 155 U.S.P.Q. (BNA) 744 (TTAB 1967) (relying on John
Walker in finding confusion for whiskey and cigarettes).
But see Schenley Distillers, Inc. v. Gen. Cigar Co., 427
F.2d 783 (CCPA 1970) (the court rejected any principle
that the same mark on tobacco and alcoholic beverage
products necessarily results in likelihood of confusion; the
court did not address the relatedness of all tobacco prod-
ucts and all alcoholic beverages under all circumstances).
CONCLUSION
It is appropriate for the Board to consider and to ex-
plain the weight given to all factors in evaluating the
totality of circumstances, explaining any departure from
holdings in other proceedings. I concur in the judgment of
vacatur and remand and would ensure the readjudication
of all the relevant factors in the Board’s further consider-
ation of the question of likelihood of confusion.