TTAB Cancels Descriptive Mark in State Permits, Inc. v. Fieldvine, Inc.

TTAB Cancels Descriptive Mark in State Permits, Inc. v. Fieldvine, Inc.

On August 16, 2024, the Trademark Trial and Appeal Board (TTAB) issued a precedential decision in State Permits, Inc. v. Fieldvine, Inc. (Cancellation No. 92075095), cancelling the Supplemental Register registration for the mark PERMITS.COM. This decision highlights the difficulties in protecting descriptive marks, particularly the challenges of establishing acquired distinctiveness.

Case Background

State Permits, Inc., the prior user of PERMIT.COM, initiated a cancellation action against Fieldvine, Inc., the registrant of PERMITS.COM. Both marks were deemed descriptive of their services—assisting with construction permits. Neither party could demonstrate the acquired distinctiveness necessary for federal trademark protection, leading the TTAB to cancel Fieldvine’s registration based on State Permits’ prior use.

Legal Framework and Analysis

1. The Otto Roth Rule

The TTAB applied the Otto Roth rule, which generally requires a challenger to prove proprietary rights in its own mark. However, in cases involving Supplemental Register marks, challengers only need to demonstrate the registered mark’s lack of distinctiveness.

2. Descriptive Marks and gTLDs

The TTAB found both marks highly descriptive, with the addition of “.COM” insufficient to confer distinctiveness. To secure protection, descriptive marks require compelling evidence of acquired distinctiveness—a high threshold neither party met.

3. Evidence of Distinctiveness

• State Permits, Inc. (using PERMIT.COM since 2013): Provided evidence of $500,000+ in promotional efforts and significant sales revenue. However, the TTAB found this insufficient due to a lack of consumer surveys, media coverage, or third-party recognition.
• Fieldvine, Inc. (registered PERMITS.COM in 2020): Submitted a CEO declaration and evidence of sales and advertising. However, the TTAB determined the evidence lacked context and failed to show consumer recognition of PERMITS.COM as a source-identifier.

Key Decision Highlights

1. Prior Use Prevails:
   The TTAB ruled in favor of State Permits based on its prior use of PERMIT.COM. For Supplemental Register marks, a prior user can prevail without proving acquired distinctiveness if the registered mark also lacks distinctiveness.
2. Vulnerability of Supplemental Register Marks:
   Unlike Principal Register marks, Supplemental Register marks do not carry a presumption of validity and are more vulnerable to cancellation.

Key Takeaways for Trademark Owners

1. Proving Acquired Distinctiveness is Challenging

Owners of descriptive marks must provide comprehensive evidence, including:

• Substantial sales and advertising data.
• Consumer recognition surveys.
• Third-party endorsements or media coverage.

2. Prior Use Can Be Decisive

Prior use of a descriptive term can provide an advantage in disputes, even without acquired distinctiveness. Early documentation of use is critical.

3. Understand the Limits of the Supplemental Register

While the Supplemental Register offers benefits like blocking later-filed applications, it does not provide the same protections as the Principal Register. Owners should assess the risks of registering descriptive marks.

4. gTLDs Like “.COM” Add Limited Distinctiveness

The TTAB reaffirmed that generic top-level domains (gTLDs) like ".COM" do not inherently make descriptive terms distinctive. Businesses relying on gTLDs should ensure their marks meet distinctiveness standards.

Conclusion

The TTAB’s decision in State Permits, Inc. v. Fieldvine, Inc. underscores the complexities of protecting descriptive marks and the importance of proactively documenting distinctiveness. Businesses using descriptive terms should evaluate their trademark strategies, gather evidence of consumer recognition, and understand the vulnerabilities of the Supplemental Register.

For personalized guidance on how this decision may affect your trademark strategy, please contact Winterfeldt IP Group.

Disclaimer

This alert is for informational purposes only and does not constitute legal advice. For specific legal concerns, consult professional counsel.

‍