Medimpact Healthcare Systems, Inc.v.Medrecon D. Wise Management Corp.

Trademark Trial and Appeal Board

Dec 7, 2012

No. 92052514 (T.T.A.B. Dec. 7, 2012)

THIS OPINION IS NOT A
PRECEDENT OF THE TTAB

Mailed:
December 7, 2012

UNITED STATES PATENT AND TRADEMARK OFFICE
_____

Trademark Trial and Appeal Board
_____

Medimpact Healthcare Systems, Inc.
v.
Medrecon D. Wise Management Corp.
_____
Cancellation No. 92052514
_____

Susan B. Meyer of Gordon Rees LLP for Medimpact Healthcare Systems, Inc.

Christopher D. Keirs of Wong Cabello Lutsch Rutherford & Brucculeri, LLP for
Medrecon D. Wise Management Corp.
_____

Before Kuhlke, Bergsman and Masiello, Administrative Trademark Judges.

Opinion by Masiello, Administrative Trademark Judge:

Medimpact Healthcare Systems, Inc. has petitioned to cancel Registration
No. 3778980 for the mark MedDetect (in standard characters) for services identified
as, “Retrieving information relating to a patient’s previously-filled prescriptions,” in
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International Class 42; and “Maintaining files and records concerning a patient’s
previously-filled prescriptions,” in International Class 44.1
As grounds for cancellation, petitioner has alleged priority of use and
likelihood of confusion. Specifically, petitioner has alleged that it is the owner of
common law rights in the mark MEDDETECT, which it has used “to designate
healthcare benefit management services, namely provider or member fraud, waste
and abuse reporting and auditing services”;2 that it has priority of use over
respondent and its mark; and that respondent’s registered mark MEDDETECT is
confusingly similar to Petitioner’s mark. Respondent denied the salient allegations
of the petition for cancellation.
The Record
The record includes the pleadings and, by operation of Trademark Rule
2.122, 37 C.F.R. § 2.122, the registration file for respondent’s mark. The record also
includes the following testimony and evidence:
A. Petitioner’s Evidence.
1. Trial Testimony by Affidavit of Dana Felthouse, petitioner’s Vice
President of Marketing Communications, with attached exhibits.3

1 Registration No. 3778980 issued on April 20, 2010, based on an allegation of first use
anywhere and in commerce on October 30, 2008.
2 Petition for Cancellation, ¶ 2. Petitioner also alleged that “Respondent is not the owner
of the mark under § 1 of the Trademark Act because it has not used the mark nor has it
established use by a licensee or related company.” Id., ¶ 11. However, petitioner has not
pursued that claim or argued it in its brief on the case and, therefore, we deem it waived by
petitioner.
3 Submitted by stipulation of the parties.
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2. Testimony deposition of Roderick M. Wade, MBA, petitioner’s Vice
President, Contract Management, with attached exhibits.

3. Notice of reliance on the following documents:

a. Internet web pages, purportedly relating to respondent and its
mark.

b. Print-out of information from online database of U.S. Patent and
Trademark Office relating to petitioner’s pending service mark
application Serial No. 77883638 for the mark MEDDETECT.

B. Respondent’s Evidence.
1. Notice of reliance on the following documents:4

a. TARR web server data relating to petitioner’s pending service
mark application Serial No. 77883638 for the mark
MEDDETECT.

b. TARR web server data relating to U.S. Registration No. 2911801
in the name of Trace America, Inc.

2. Notice of reliance on the following documents:

a. Petitioner’s responses to respondent’s first set of interrogatories.

b. Petitioner’s responses to respondent’s first set of requests for
admissions.

Standing
Petitioner is a “pharmacy benefit management company”5 that has offered its
customers, under the mark MEDDETECT, a service that includes the collection and

4 This notice of reliance was filed on May 19, 2011, before the opening of respondent’s
testimony period. However, petitioner did not object and has discussed the evidence
submitted with the notice of reliance in petitioner’s brief. We deem the objection waived, as
the defect in filing could have been cured if promptly raised. TBMP §§ 707.04 and
707.02(b).
5 Wade Dep., p. 7.
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processing of data relating to the prescribing and delivery of prescription drugs.6
Respondent has conceded, in its brief, that petitioner owns an application for U.S.
registration of the mark MEDDETECT (Serial No. 77883638) against which the
respondent’s application Serial No. 77584356, which underlay respondent’s involved
registration, was cited by the Patent and Trademark Office as a potential bar to
registration.7 These facts are sufficient to demonstrate that petitioner has a real
interest in this proceeding and therefore has standing. Lipton Industries, Inc. v.
Ralston Purina Co., 670 F.2d 1024, 213 USPQ 185, 189 (CCPA 1982).
Priority
Petitioner has not pleaded ownership of any relevant U.S. trademark
registration. Accordingly, in order to prevail on the ground of likelihood of
confusion under Section 2(d) of the Trademark Act, it is the petitioner’s burden to
prove that its MEDDETECT mark is, vis-à-vis the respondent’s registered mark, “a
mark or trade name previously used in the United States... and not abandoned...”
Trademark Act Section 2(d), 15 U.S.C. § 1052(d). Respondent has not submitted
any evidence regarding its earliest use of its registered mark. Accordingly, in
accordance with Trademark Act § 7(c), 15 U.S.C. § 1057(c), we take as respondent’s
constructive date of first use the filing date of the application underlying
respondent’s involved registration. That date is October 2, 2008. Petitioner must
therefore show that it acquired a proprietary interest in the mark MEDDETECT
prior to that date of constructive use.

6 Id. at 8-10.
7 Respondent’s brief at p. 3
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Petitioner has placed in evidence an “advertising slick” on which the mark
MEDDETECT is prominently displayed.8 Petitioner’s witness states that this
advertisement was created in July of 2006; that since that date, “it is available for
use by Medimpact in promoting its services to clients and potential clients”; and
that it “continues to be used by the MedImpact Marketing Department.”9
Petitioner has also shown that, in response to requests for proposals, it
provided proposals for the provision of pharmacy benefit management services
dated February 20, 2007; August 1, 2007; February 20, 2008; March 31, 2008; May
23, 2008; June 10, 2009; and May 25, 2010.10 These proposals contained references
to the MEDDETECT mark in their text. The proposal dated May 23, 2008 resulted
in the execution of a service agreement between petitioner and its client (the
“Service Agreement”). The Service Agreement provides that it “shall become
effective as of October 1, 2008.” The Service Agreement was signed by petitioner’s
client on September 30, 2008 and by petitioner on October 14, 2008.11 Petitioner’s
witness testified that the Scope of Services set forth in the Service Agreement
included services of the type that petitioner designated with the MEDDETECT

8 Felthouse Declaration, Exhibit 1.
9 Felthouse Declaration, ¶¶ 3 and 6-8.
10 Wade Dep., Exhibits 3 and 5-10. Redacted forms of the proposals were submitted as part
of the confidential record. The seven proposals were addressed to seven different potential
clients.
11 Wade Dep., p. 28, ll. 1-6, and Exhibit 4.
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designation.12 On cross-examination, he admitted that the mark MEDDETECT is
not used in the service agreement.13
In order to demonstrate technical service mark use, as defined in the
Trademark Act, it must be shown that the mark has been used or displayed in the
sale or advertising of the services and that the services have been rendered. See
Trademark Act § 45, 15 U.S.C. § 1127.14 On the record before us, petitioner has not
demonstrated technical service mark use of MEDDETECT prior to October 2, 2008,
the respondent’s constructive use date. Although the evidence shows some
promotion of the mark prior to that date, and suggests that advertising of the mark
might date back to 2006, there is no evidence showing that any services were ever
rendered under the MEDDETECT mark prior to October 2, 2008. The fact that the
Service Agreement was “effective as of” October 1, 2008 might suggest that services
under the Service Agreement commenced as early as that date; however, petitioner
presented no evidence of when such services actually commenced. The fact that
petitioner did not sign the Service Agreement until October 14, 2008 suggests that
the rendering of services may well have been delayed until after that date. In sum,
the evidence does not show technical service mark use prior to the respondent’s
constructive date of first use.

12 Id. at 28, ll. 9-19.
13 Id. at 39, l. 3.
14 The requirement of Trademark Act Section 45 that the mark must be used in a type of
commerce that may be regulated by the U.S. Congress does not apply to a plaintiff in a
cancellation or opposition proceeding, as Section 2(d) does not require such use. First
Niagara Insurance Brokers, Inc. v. First Niagara Financial Group, Inc., 476 F.3d 867, 870,
81 USPQ2d 1375, 1378 (Fed. Cir. 2007).
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Petitioner may nonetheless seek to establish prior use of the MEDDETECT
mark through use analogous to trademark use, if such use was sufficient to create
proprietary rights prior to the respondent’s date of constructive use. “Before a prior
use becomes an analogous use sufficient to create proprietary rights, the petitioner
must show prior use sufficient to create an association in the minds of the
purchasing public between the mark and the petitioner’s goods.” Herbko
International, Inc. v. Kappa Books, Inc., 308 F.3d 1156, 1162, 64 USPQ2d 1375,
1378 (Fed. Cir. 2002). “Such an ‘analogous use’ [proceeding] can succeed, however,
only where the analogous use is of such a nature and extent as to create public
identification of the target term with the opposer’s product or service.” T.A.B.
Systems v. PacTel Teletrac, 77 F.3d 1373, 1374, 37 USPQ2d 1879, 1881 (Fed. Cir.
1996). The Federal Circuit has required that evidence of such analogous use enable
the factfinder to infer that “a substantial share of the consuming public had been
reached,” and that such use “must have a substantial impact on the purchasing
public.” Id. at 1882.
The record contains no evidence of the extent to which the “advertising slick”
of 2006 (petitioner’s Exhibit 1) was distributed to potential clients, or even that it
was ever used, other than the statements of its Vice President for Marketing
Communications that it was “available for use by Medimpact in promoting its
services” in 2006 and that it “continues to be used.”15

15 Felthouse Declaration, ¶¶ 7-8.
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The remainder of petitioner’s evidence shows that prior to October 2, 2008,
the mark MEDDETECT appeared in five proposals presented to five potential
clients. In those proposals, petitioner identifies itself with the mark MEDIMPACT,
which appears in logo format at the upper-right corner of most pages. A
representative display of the MEDDETECT mark is as follows:
In addition to our comprehensive desk and on-site
auditing program, MedImpact uses specialized software
to identify and prevent Waste, Fraud, and Abuse.
MedImpact MedDetect™, a Web-based fraud, abuse and
error detection tool, enables us to efficiently research,
identify, monitor, and take immediate action to mitigate
financial risk and liability. Using this tool, we can access
data through a user-friendly interface, and can quickly
analyze massive volumes of data in seconds.
MedDetect is an analytics solution; it dynamically
identifies subtle signals of previously unknown or
emerging issues within your pharmacy utilization data.
It uses historical data to develop profiles and dynamically
updates these profiles when new data is loaded. The
system is a learning model, which uses the data to
identify issues through dynamic profiling and advanced
analytics. Once the abnormal patterns are detected, the
issues identified are rank ordered by score.
Exhibit 5, proposal for services dated February 20, 2007, pp. 4-5 (originally
paginated as pp. 62-63). Similar descriptions of the MEDDETECT service can be
found in Exhibit 6 (proposal of August 1, 2007) at original p. 43; Exhibit 7 (proposal
of March 31, 2008) at original p. 62; Exhibit 8 (proposal of February 20, 2008) at
original p. 81; and Exhibit 3 (proposal of May 23, 2008) at original pp. 48-49. There
are a number of other references to the designation MEDDETECT scattered in the
text of these proposals. The most prominent display of the mark is in the February
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20, 2007 proposal, which includes an index of attachments in which the wording
“ATTACHMENT G – MEDDETECT INFORMATION” appears in bold lettering.
The evidence shows more prominent displays of the MEDDETECT mark in
proposals issued later than the registrant’s constructive date of first use. In Exhibit
9 (proposal of June 10, 2009) and Exhibit 10 (proposal of May 25, 2010), the
description of the MEDDETECT feature is preceded by a heading that reads
“MedDetect” in bold italic lettering. However, these uses do not serve to show that
any rights were acquired prior to the registrant’s constructive date of first use.
The fact that petitioner’s displays of the mark MEDDETECT are deeply
embedded in the text of lengthy documents reduces the likelihood that the mark
will be noted by customers; but a careful reader might note the mark and make the
necessary association between it and the services of petitioner. The likelihood that
this would happen is yet further reduced by the somewhat indefinite wording of the
descriptions of the MEDDETECT service. The suggestion, in the wording quoted
above, that MEDDETECT identifies “software” and “an analytics solution” blurs the
nature of the service offered, and could be interpreted to mean that MEDDETECT
is the name of a computer program that petitioner uses in rendering its services.
This impression is reinforced by other text that states:
Using MedDetect, we are able to identify questionable
events and develop an investigational multi-path analysis
to determine if a trend exists for a specific drug,
therapeutic category, prescriber, pharmacy, or member.
Exhibit 3 at original p. 45.
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The above text suggests that MEDDETECT may be a product that is not
offered to the client, but rather is used by petitioner in performing its service. It
also could be interpreted to mean that MEDDETECT is neither a product nor a
service, but merely a system, process or method for petitioner’s operations. We
question whether use of a designation to identify a system, process or method of
doing business can be called analogous to trademark or service mark use. The
unclear message conveyed by the descriptions of the MEDDETECT feature of
petitioner’s service reduces the likelihood that a potential client would associate the
mark with a service offered by petitioner.
Finally, we address the extent of petitioner’s use of the MEDDETECT mark
prior to respondent’s constructive use date. The evidence shows that petitioner
showed the MEDDETECT mark to five potential clients prior to October 2, 2008,
resulting in the execution of one contract. (As noted above, there is no evidence of
the extent to which the “advertising slick” of 2006 (petitioner’s Exhibit 1) was ever
distributed.) We must consider whether petitioner’s demonstrated use of the mark
has reached “a substantial share of the consuming public” or, alternatively, “more
than a negligible share of potential customers.” T.A.B. Systems v. PacTel, at 1882.
The record contains little evidence regarding the size of the relevant market.
Petitioner is described as a “pharmacy benefit management company” that is
“responsible for managing the broad scope of services that our clients require in
support of their prescription drug benefit programs.”16 Petitioner’s testimony states

16 Wade Dep., p. 7, ll. 7-11.
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that petitioner is “a national company” employing approximately 900 full-time
employees, and having “several hundred contracts with our clients.”17 Petitioner’s
clients are described as “managed care organizations…, self-insured employers,
unions, third party administrators, … who contract with MedImpact for us to
provide claims adjudication, network reimbursement, clinical healthcare
management, information technology solutions, any aspect of their prescription
drug program….”18 The market for petitioner’s MEDDETECT services is
apparently co-extensive with, or possibly even larger than, the market for
petitioner’s core services: “[T]he MedDetect service is a broad scope of services we
provide to our clients and to other interested parties, which could include
accreditation agencies and regulatory agencies, associated with monitoring and
reviewing the prescribing and fulfillment activities through physicians and our
pharmacy networks….”19 A review of all evidence of record, including confidential
evidence relating to specific clients of petitioner, indicates that the relevant market
for petitioner’s MEDDETECT services includes, at least, all entities that provide to
others healthcare insurance benefits that include prescription drug coverage, and
that this market would include healthcare insurance companies, businesses that
provide insurance to their employees, and state and local government entities that
provide such healthcare insurance coverage. The “national” market of such
potential clients, to which petitioner directs its services, is a large one.

17 Id., p. 7, l. 20 – p. 8, l. 2.
18 Id., p. 7, ll. 7-19.
19 Id., p. 8, ll. 14-20.
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As noted, petitioner has demonstrated that it showed its mark
MEDDETECT to five potential clients prior to October 2, 2008. We find such a
showing an inadequate basis on which to infer that petitioner’s advertising under
this mark has reached “more than a negligible portion of the relevant market.”
T.A.B. Systems v. PacTel, at 1882. Considering this in light of our reservations
regarding the nature of petitioner’s use of its mark, discussed above, we find that
the extent and nature of petitioner’s prior use is insufficient to “create an
association in the minds of the purchasing public between the mark and the
petitioner’s [services],” Herbko at 1378, or to “create public identification of the
target term with the [petitioner’s] product or service.” T.A.B. Systems v. PacTel at
1881.
Inasmuch as we find that petitioner has failed to prove that it has a
proprietary interest in the designation MEDDETECT prior to that of respondent,
petitioner’s claim under Section 2(d) fails and it is unnecessary for us to consider
whether there is a likelihood of confusion, mistake or deception as between the
marks at issue, as applied to their respective services.
Decision: The petition for cancellation is dismissed with prejudice.