M.C.I. Foods, Inc.v.Los Cabos Food Corp. and Richard Staunton

Trademark Trial and Appeal Board

Sep 21, 2004

No. 92024998 (T.T.A.B. Sep. 21, 2004)

Mailed: Sept. 21, 2004
UNITED STATES PATENT AND TRADEMARK OFFICE
_____
Trademark Trial and Appeal Board
_____
M.C.I Foods, Inc.
v.
Los Cabos Food Corporation
and Richard Staunton,
joined as party defendant
_____
Cancellation No. 92024998
_____
Brian J. Hundertmark of Roberts & Hundertmark, LLP for
M.C.I. Foods, Inc.
Whitney Wilson of Bryan Cave LLP for Los Cabos Food
Corporation and Richard Staunton, joined as party defendant.
_____
Before Seeherman, Hohein and Rogers, Administrative
Trademark Judges.
Opinion by Seeherman, Administrative Trademark Judge:
On March 21, 1996, M.C.I. Foods, Inc. filed a petition
to cancel the registration of Los Cabos Food Corporation for
the mark LOS CABOS and design, as shown below, for
"restaurant services."1
1 Registration No. 1774757, issued June 1, 1993, based on an
intent-to-use application filed August 1, 1991; Section 8
THIS DISPOSITION IS NOT
CITABLE AS PRECEDENT OF
THE TTAB
Cancellation No. 92024998
2
As grounds for cancellation, petitioner has alleged
that it has filed an application, Serial No. 74551603, to
register LOS CABOS and design for burritos, enchiladas,
tacos, taquitos, and soft tacos; that the Examining Attorney
has refused registration of petitioner's mark because "the
mark for which registration is sought so resembles the mark
shown in U.S. Registration No. 1774757 [the subject
registration] as to be likely, when used on the identified
goods, to cause confusion, or to cause mistake, or to
deceive"; that the refusal to register petitioner's
trademark constitutes the damage required for petitioner's
standing to bring this proceeding; and that petitioner's
affidavit accepted. The registration issued in the name of Los
Cabos Food Corporation, and this is the party which filed all
subsequent papers. However, in its brief, filed October 8, 2003,
respondent stated that on May 27, 1999 an assignment was recorded
with the USPTO assigning the registration to Richard Staunton,
and that Mr. Staunton is the current owner of the registration.
Office records confirm that an assignment was recorded on that
date. Accordingly, we have joined Richard Staunton as a party
defendant. However, because all papers filed by respondent
identify respondent only as Los Cabos Food Corporation, we will
do the same in our opinion.
Cancellation No. 92024998
3
application for registration lists a first-use date of
April 6, 1992, but that "subsequent review has determined"
that petitioner has used its mark for its goods prior to the
respondent's August 1, 1991 filing date and July 30, 1992
first use date. Although not specifically pleaded, it
appears that petitioner seeks to cancel respondent's
registration pursuant to Section 2(d) of the Trademark Act,
15 U.S.C. §1052(d), on the ground of priority of use and
likelihood of confusion.
In its answer, respondent has admitted that petitioner
is the applicant of Application Serial No. 74551603, and has
denied the remaining salient allegations of the petition for
cancellation.
There are a number of procedural and evidentiary
matters that we must now discuss. First, with its second
notice of reliance petitioner has submitted the answers and
objections of respondent to petitioner's first and second
requests for the production of documents. Documents
produced in response to such requests may not be made of
record by notice of reliance. See Trademark Rule
2.120(j)(3)(ii). However, such documents, if treated as if
they are of record, may effectively be stipulated into the
record by the parties. See JSB International, Inc. v. Auto
Sound North, Inc., 215 USPQ 60, n.3 (TTAB 1982). In this
case, although respondent has not supplied a description of
Cancellation No. 92024998
4
the record in its brief, respondent has discussed the
documents, and we therefore deem respondent to have
stipulated them into the record.2
Respondent raised a number of hearsay objections to
documents which were introduced during the testimony
deposition of Daniel J. Southard, petitioner's president.
Respondent did not explain the reason for its claim of
hearsay during the deposition. In its brief respondent
states: "This objection was preserved at the deposition of
Mr. Southard and should bar consideration of the documents."
Brief, p. 7. Respondent further states in its brief that:
"In fact, the originals of the documents were not available
for inspection by [respondent] because the [sic] allegedly
had been destroyed pursuant to a document retention policy."
We assume therefrom that respondent's hearsay objection is
based on the fact that the exhibits were photocopies rather
than original documents.
The exhibits are photocopies made by Mr. Southard of
business records which he had given to petitioner's attorney
in 1992 at the attorney's request. The originals were
subsequently destroyed as part of petitioner's policy of
purging its records after five years.3 Mr. Southard
2 We would point out that, even if we did not consider them, it
would not change our decision herein.
3 The "originals" of two of the documents, a log created by the
USDA, and a copy of a check made out to petitioner which
petitioner had cashed, were always kept by petitioner as
Cancellation No. 92024998
5
testified that he did not realize it would be necessary to
keep the originals in connection with this proceeding, and
they were therefore purged along with other older records.
We find Mr. Southard's testimony to be credible, and an
acceptable explanation as to why the original documents are
no longer available. We are further satisfied that the
photocopies are true copies of the originals. Respondent's
objections to the documents are overruled.
In its brief petitioner has made reference, as support
for some of its statements of fact, to the affidavit of
Daniel Southard which was submitted with its motion for
summary judgment. That motion was denied by the Board on
November 1, 1999 as untimely. Materials submitted in
connection with a motion for summary judgment do not form
part of the record at trial unless they are specifically
made of record during the testimony period, and in
accordance with the Trademark Rules. See TBMP §528.05(a)
(2d ed. rev. 2004), and cases cited therein at note 403,
particularly American Meat Institute v. Horace W. Longacre,
Inc., 211 USPQ 712, 716, n. 2 (TTAB 1981) (material in
support of untimely summary judgment motion not trial
evidence absent agreement of parties). Because petitioner
did not make Mr. Southard's affidavit of record during
photocopies, since in the first case the original was the
property of the USDA, and in the second the cashed check would
have been returned to the company which issued it.
Cancellation No. 92024998
6
trial, we have not considered either the affidavit or the
factual statements in petitioner's brief for which the
affidavit is relied on as support. Petitioner has also
cited, in support of some of its recitation of facts, the
"application file of petitioner's mark." The application
file of a plaintiff does not automatically form part of the
record, and petitioner has not otherwise made the entire
file of record. However, the initial application papers and
the first Office action of the Examining Attorney were
introduced as exhibits with the testimony of Daniel
Southard, and they have been considered.
In its brief, petitioner has stated that the issue
before the Board is whether respondent is entitled to retain
its registration in light of the facts that 1) petitioner
made significant use of its trademark prior to respondent's
first use; 2) respondent was aware of prior conflicting uses
of the mark by others when it filed its application, but did
not admit to such knowledge in its application; and
3) respondent has failed to enforce its registrations
against infringing uses (and thus has presumably abandoned
its mark). Respondent has argued that the latter two
grounds--essentially fraud and abandonment, were neither
pleaded nor tried. We agree. Certainly there is nothing in
the petition for cancellation that could be construed even
as an allegation that respondent knew of conflicting or
Cancellation No. 92024998
7
infringing uses by others, let alone a pleading of fraud
with the particularity that is required of such a pleading;
and even petitioner does not seem to be clear as to what it
might have wanted to plead with respect to conflicting uses.
In its brief petitioner states that respondent's failure to
enforce its registration against infringing uses "may be
cause for abandonment of the registration or, at the very
least, diminution of Registrant's ability to contest any
other party's proceeding against the registration." p. 10.
We must also consider whether the grounds of fraud or
abandonment, even though not properly pleaded, were tried.
Petitioner has not provided any basis in its brief for us to
make such a finding. Petitioner's evidence in support of
the grounds of fraud and abandonment for failure to enforce
rights is respondent's response to petitioner's document
production request discussed above and respondent's answers
to certain of petitioner's interrogatories. In the notice
of reliance under which petitioner submitted those
documents, it stated that the interrogatory responses were
being submitted to show, inter alia, "the Registrant's
enforcement of its mark, and the Registrant's awareness of
other parties using the registered mark" and, in connection
with the responses to its document production requests, that
they were "being relied upon by Petitioner to show the
Registrant's enforcement of its mark and the Registrant's
Cancellation No. 92024998
8
awareness of other parties using the registered mark."
These statements by petitioner are not sufficient to put
petitioner on notice that petitioner was asserting or
attempting to try the additional grounds of fraud and
abandonment. Thus, we do not deem the pleadings to have
been amended pursuant to Fed. R. Civ. P. 15(b). The grounds
of fraud and abandonment raised in petitioner's brief
therefore have not been considered.4
4 We note that even if we had found these issues to be tried,
the evidence submitted by petitioner falls far short of
establishing its right to judgment on such grounds. The document
production is a search for "Los Cabos" conducted by a private
search service, and lists third-party registrations, state
registrations, and information taken from reference works, on-
line data bases, and the like. Third-party registrations are not
evidence of use of the marks shown therein. In re Albert Trostel
& Sons Co., 29 USPQ2d 1783 (TTAB 1993). Neither is a mere
listing of a business taken from either a search company's
database or its search of another private database (it is not
clear from the report which is the case). Such information is
clearly hearsay, and in the absence of any testimony as to the
efforts of the search company's and/or the company maintaining
the database to insure that the information is current and
accurate, it is of no probative value. Compare Tiffany & Co. v.
Classic Motor Carriages Inc., 10 USPQ2d 1835, n. 5 (TTAB 1989).
The interrogatory responses state that, as of the filing of its
application, respondent knew of a search report listing one
registration for LOS CABOS for wines, and a listing for Los Cabos
Restaurant in Colorado and Los Cabos Corporation in California.
There is no evidence that respondent knew that any of the
businesses listed were actually in existence, or had rights
superior to respondent's in marks for goods or services with
which respondent's mark was likely to cause confusion. Moreover,
we note that one of petitioner's requests for admission which, in
the absence of a response by respondent is deemed to be admitted,
is that "Registrant is not, and has not been, aware of any other
party's use of a LOS CABOS mark, other than that used by
Petitioner." Request No. 6. Thus, the evidence submitted by
petitioner itself belies any claim that respondent committed
fraud in the filing of its application, or that respondent has
abandoned its rights in its mark.
Cancellation No. 92024998
9
The record, thus, includes, the pleadings; the file of
the registration sought to be cancelled; and the testimony,
with exhibits, of Daniel E. Southard. Petitioner has also
submitted, under notice of reliance, respondent's responses
to certain of petitioner's interrogatories and its responses
to petitioner's document production requests; a definition
of "cabo" taken from a Spanish and English dictionary; and
petitioner's requests for admission, which, because of
respondent's failure to respond to them, must be deemed to
have been admitted. Respondent did not submit any evidence.
This proceeding has been fully briefed, but neither
party requested an oral hearing. It is noted that
respondent cited, and attached to its brief, an unpublished
decision by the Board. The Board has explicitly stated that
it disregards citation of any unpublished decision of the
Board, even if a complete copy of the unpublished decision
is submitted. General Mills, Inc. v. Health Valley Foods,
24 USPQ2d 1270 (TTAB 1992). Accordingly, such decision has
not been considered.
The focus of the parties' briefs has been on the issue
of priority. Petitioner, in its application for the mark
LOS CABOS and design, asserted that it first used the mark
and first used it in commerce on April 6, 1992. This date
is subsequent to the August 1, 1991 filing date, and hence
constructive use date, of the application which issued into
Cancellation No. 92024998
10
respondent's registration. Thus, in order to prevail on the
issue of priority, petitioner must show, by clear and
convincing evidence, that it made use of its mark prior to
August 1, 1991. See Martahus v. Video Duplication Services
Inc., 3 F.3d 417, 27 USPQ2d 1846, n. 7 (Fed. Cir. 1993);
Hydro-Dynamics, Inc. v. George Putnam & Co., Inc., 811 F.2d
1470, 1473, 1 USPQ2d 1772 (Fed. Cir. 1987).
We find that petitioner has made such a showing. The
evidence demonstrates that on May 8, 1991 petitioner ordered
a "Los Cabos Die" from Huntington Park Rubber Stamp, that
this company billed petitioner for an "18 line 7 inch die"
on May 14, 1991, and that on June 7, 1991 petitioner wrote a
check to the order of "Huntington Pk Rubber Stamp Co." for
the amount shown on the invoice. The log kept by the USDA
shows that approval was given for a "shredded beef & cheese
& green chili burrito" on June 26, 1991; the log shows an
asterisk next to this item in the log, which petitioner's
witness states was placed there at the time the log was
photocopied by the witness in 1992 to give to petitioner's
attorney. We think this testimony is credible to show that
this is the LOS CABOS label for which Huntington Park
prepared the die. The record also shows that petitioner
(using its dba Delseys Foods) took an order from "Michael
Levin" on July 1, 1991, shipped the order on July 8, 1991,
and prepared an invoice dated July 12, 1991 to Michael Levin
Cancellation No. 92024998
11
Ent. which lists, inter alia, 20 cases of "Los Cabos Bulk
Pack SHD BEEF/CHZ/GRN CHILI 48/5.0 oz." at a unit price of
23.85 per case, for a cost of $477.00. The invoice
indicates, under terms, "2% 10 NET 30," which Mr. Southard
explained means that if payment were received in 10 days,
the customer would receive a 2% discount. The invoice also
bears a stamped "Paid July 18, 1991," with a notation that a
discount was applied. There is also a check from Michael
Levin Enterprises, Inc. (again, all the documents are
photocopies) dated July 18, 1991 for the price listed on the
invoice.
The various documents, including those which were
prepared by third parties, and Mr. Southard's testimony,
establish that petitioner created a label bearing the mark
LOS CABOS and design in May 1991, obtained label approval
from the USDA at the end of June 1991, took an order for
goods bearing the mark LOS CABOS and design at the beginning
of July 1991, and shipped the product to a third party on
July 8, 1991, which was prior to the filing of respondent's
application on August 1, 1991.
Respondent has asserted that, even if we find that
petitioner made a shipment in July 1991, that shipment was
only token use of the mark, and that petitioner could not
obtain any rights from it. Respondent claims that
petitioner has not presented any evidence of additional
Cancellation No. 92024998
12
sales prior to the filing of petitioner's application in
1994, and that the sale it did make in July 1991 was de
minimis because it was for less than $500.
We regard respondent's arguments regarding lack of
evidence of continuous use to relate to its claim that the
July 1991 sale was token use. However, to the extent that
respondent might be arguing that petitioner was required to
prove not only prior but continuous use of its mark, we
reject such an argument. Our primary reviewing court, the
Court of Appeals for the Federal Circuit, has made clear
that "the governing statute does not speak of 'continuous
use,' but rather of whether the mark or trade name has been
'previously used in the United States by another and not
abandoned.' 15 U.S.C. Section 1052(d)." West Florida
Seafood Inc. v. Jet Restaurants Inc., 31 F.3d 1122, 31
USPQ2d 1660, 1665 (Fed. Cir. 1994) (emphasis in original).
We also note Mr. Southard's testimony, in which he stated
that the LOS CABOS label originally used in July 1991 is
still in use, although there has been a slight change in the
ingredients information.
We disagree that the sale in July 1991 was a token
sale. Although petitioner has not presented documentary
evidence of additional sales, petitioner's president has
explained that petitioner has a policy of purging its
records after five years. He also testified that he listed
Cancellation No. 92024998
13
April 1992 on petitioner's trademark application because it
was "a very heavy usage time for the Los Cabos brand." Dep.
p. 57.5 This statement certainly implies that there were
sales under the mark prior to April 1992 and subsequent to
the first use in July 1991.
Moreover, although the July 1991 sales under the LOS
CABOS mark were relatively small, particularly in light of
petitioner's other sales at the time, which were in the tens
of thousands per month, Mr. Southard explained that the LOS
CABOS mark was a new mark which petitioner was considering
as taking the place of its primary mark at the time,
DELSEYS. In these circumstances, we think a first shipment
of twenty cases was a bona fide use of the mark in the
ordinary course of trade, and not made merely to reserve a
right in the mark. See Section 45 of the Trademark Act, 15
U.S.C. §1127. We also note that petitioner had a die made
for the printing of its labels, and obtained approval for
its label from the USDA. These labels were not the
temporary type of label, such as a handwritten or typed
label or a sticker, that often is used in connection with a
sale of goods made solely to reserve rights in a mark.
Rather, petitioner had both ordered a die to prepare the
5 He further explained that as a result the documents evidencing
the April date were easy to access.
Cancellation No. 92024998
14
labels, and gone through the process of obtaining government
approval for their use.
Accordingly, we find that petitioner has shown that it
made bona fide use of its mark in the ordinary course of
trade prior to the filing date of respondent's underlying
intent-to-use application, which is the earliest date on
which respondent can rely.
Although petitioner has established its priority, to
prevail on a Section 2(d) ground it must also demonstrate
likelihood of confusion. It appears that petitioner did not
believe this was necessary. As noted above, petitioner did
not assert in its pleading an allegation that respondent's
use of its mark for its services was likely to cause
confusion with petitioner's mark.6 Further, during the
cross-examination of Mr. Southard, respondent's attorney
asked the witness if he were aware of any instances of
confusion between the marks as used by the parties.
Petitioner's attorney objected to this question based on
relevance, "in that that is not an issue before the Board."
Dep. p. 63. However, the question of likelihood of
confusion is most certainly an issue in this proceeding.
6 It is possible for a plaintiff to plead likelihood of
confusion as a hypothetical in a situation where the defendant's
registration (or application) has been cited against the
plaintiff's application. For example, without actually alleging
that there is likelihood of confusion, the plaintiff can assert
that, if likelihood of confusion should be found, the plaintiff
has priority and should prevail. In the present case, however,
petitioner did not so plead.
Cancellation No. 92024998
15
The fact that the Examining Attorney examining petitioner's
application refused registration based on a likelihood of
confusion with respondent's mark does not establish that
confusion is likely. That is something the Board must
decide, based on the evidence before us. The Board is not
bound by decisions of Examining Attorneys. Cineplex Odeon
Corp. v. Fred Wehrenberg Circuit of Theatres Inc., 56 USPQ2d
1538 (TTAB 2000); In re BankAmerica Corporation, 231 USPQ
873 (TTAB 1986). If it were, there would be no point in the
Board's having authority to decide appeals from refusals by
Examining Attorneys.
Petitioner has not submitted any evidence going
directly to the issue of likelihood of confusion, and the
factors set forth by the predecessor to our principal
reviewing court the Court in In re E. I. du Pont de Nemours
& Co., 476 F.2d 1357, 177 USPQ 563 (CCPA 1973). Nor has
petitioner presented any arguments on the issue of
likelihood of confusion in its brief, and respondent
therefore has not presented any arguments in response. As a
result, we must determine this question without benefit of
the parties' views.
We turn first to a comparison of the marks, which are
shown below.
Cancellation No. 92024998
16
Petitioner's mark Respondent's mark
We recognize that the marks are similar. The words in both,
LOS CABOS, are identical. Although respondent's mark has a
slight design element that is reminiscent of a sombrero, and
petitioner's mark has a design consisting of palm trees and
what appears to be a sun, it is the words that are the
dominant element in each mark. They clearly are the most
visually prominent portion of the marks, and the element
likely to be noted and remembered by consumers, as that is
how they will refer to or call for the product or services.
There is nothing improper in stating that, for rational
reasons, more or less weight has been given to a particular
feature of a mark, provided the ultimate conclusion rests on
a consideration of the marks in their entireties. In re
National Data Corp., 753 F.2d 1056, 224 USPQ 749 (Fed. Cir.
1985).
Petitioner has submitted evidence that a "cabo" is a
cape in the geographic sense, and respondent's registration
Cancellation No. 92024998
17
also translates LOS CABOS as "the cape." While the use of
Spanish words for a Mexican food and a Mexican-style
restaurant suggests the Mexican nature of the goods and
services, the meaning of the words does not appear to be
suggestive of particular product or service features.7
These factors of the similarity of the marks and the
strength of petitioner's mark favor a finding of likelihood
of confusion.
However, because petitioner does not have a
registration for its LOS CABOS and design mark, its rights
in the mark are based on its actual use of the mark on the
goods. There is limited information about this use in the
record, deriving from the testimony as to petitioner's first
sale of the goods. The record shows that "shipping
container labels" bearing petitioner's mark were placed on
the shipping containers of each case of petitioner's LOS
CABOS shredded beef, cheese and green chili premium
burritos. The record also shows that twenty cases of these
burritos were shipped to Michael Levin Enterprises, which
company is a distributor who would "resell it to convenience
7 As noted above, petitioner has submitted a search report which
was provided by respondent in response to a document production
request. This report was prepared by a private search company,
and therefore it is not evidence of the existence of the
registrations or third-party uses shown therein. See
Weyerhaeuser Co. v. Katz, 24 USPQ2d 1230 (TTAB 1992). In any
event, the single third-party registration, for LOS CABOS for
wine, is not sufficient for us to find that this term has a
meaning in either the prepared food or restaurant industries.
Cancellation No. 92024998
18
stores, schools, fast food restaurants, things of that
nature in the food service industry, restaurant industry."
Southard dep. p. 53.
Thus, the only evidence of use of the mark LOS CABOS is
on labels for shipping containers containing burritos sold
in bulk. There is no evidence that the mark is used on
labels or packaging for individual burritos, or that the
convenience stores, schools or fast food restaurants resell
the burritos bearing the mark LOS CABOS to the general
public, or that members of the public are ever exposed to
petitioner's mark. Therefore, for purposes of our analysis
of likelihood of confusion, we must assume that the only
overlapping customers for petitioner's burritos and
respondent's restaurant services are people in the food
industry.
Such purchasers are obviously discriminating and
careful, since they are buying food in bulk. They are not
likely to believe, simply on the basis that similar marks
are used, that respondent's Mexican style-restaurant8 and
petitioner's burritos sold in bulk are associated with or
sponsored by or emanate from the same source. In this
connection, there is no evidence in the record that
8 Although respondent did not submit any evidence, its
interrogatory responses that petitioner made of record show that
it is a Mexican-style restaurant which sells Mexican-style food,
as well as T-shirts, caps and other promotional items.
Cancellation No. 92024998
19
companies which sell food in bulk to schools and restaurants
also operate their own restaurants under a single mark.
The only other "evidence" we have with respect to the
remaining duPont factors relates to actual confusion. Mr.
Southard testified that "people have walked up to me and
said, in other cities, do you own Los Cabos restaurants, and
I would say no, I don't, and just leave it at that." Dep.
p. 63. Mr. Southard did not provide any further information
about the circumstances in which this inquiry was made,
e.g., whether it was by a customer of his company's
products, or simply someone to whom he merely mentioned his
company while engaged in casual conversation. Certainly we
cannot conclude from this testimony that there have been any
instances of actual confusion by the customers or potential
customers of both the goods and services.
Upon considering all of the duPont factors on which we
have evidence, we conclude that, despite the similarity of
the marks, petitioner has failed to meet its burden of
proving that the discriminating purchasers who are the only
common customers of petitioner's goods and respondent's
services would assume that burritos sold in bulk to fast
food restaurants, convenience stores and schools, on the one
Cancellation No. 92024998
20
hand, and restaurant services on the other, would emanate
from the same source.9
Decision: The petition to cancel is denied.
9 We do not suggest by this finding that the Examining Attorney
cannot conclude that there is a likelihood of confusion between
the mark for which petitioner has applied in Application Serial
No. 74551603 and respondent's registration. We are saying only
that on the record presented here, petitioner has failed to
establish that respondent's mark for its services is likely to
cause confusion with petitioner's mark for burritos sold in bulk
to convenience stores, schools and fast food restaurants. On a
different record, a different result might obtain. In this
connection, we note that in its application petitioner has
identified its goods simply as "burritos, enchiladas, tacos,
taquitos, soft tacos" without any restriction as to channels of
trade.