Federal Circuit Rules TTAB Applied Wrong Legal Standard on Pretzel Crisps Trademark

Princeton Vanguard, LLC v. Frito-Lay N. Am., Inc., No. 2014-1517 (Fed. Cir. May 15, 2015). In doing so, the Federal Circuit held that the Board applied the incorrect legal standard for determining genericness. If a mark is generic, that is, it directly describes the goods and is understood by the relevant public to mean those goods (think APPLE for the fruit apple).

Facts

In 2004 Princeton Vanguard, LLC (Princeton Vanguard) registered PRETZEL CRISPS for pretzel crackers on the Supplemental Trademark Register, which is reserved for nondistinctive marks that are capable of acquiring distinctiveness but have not yet done so. In December 2009, Princeton Vanguard filed new applications to register PRETZEL CRISPS for pretzel crackers on the Principal Register.

On July 2, 2010, Frito-Lay North America, Inc. (Frito-Lay) opposed Princeton Vanguard’s applications to register PRETZEL CRISPS, arguing that the mark is generic for pretzel crackers and highly descriptive of a type of cracker product. Frito-lay also filed a petition to cancel the 2004 registration on similar grounds. The Board sustained Frito-Lay’s opposition and granted its petition for cancellation. Princeton Vanguard appealed.

Legal Analysis

On appeal, Princeton Vanguard argued that the Board erred in its genericness analysis by assessing PRETZEL CRISPS as a compound term of two words instead of a unitary phrase; by focusing on the mark’s constituent parts, the Board failed to consider the mark in its entirety. Princeton Vanguard also argued that the Board failed to consider relevant evidence of record that showed the purchasing public understood the term PRETZEL CRISPS to be a brand name.

The appeals court found that the Trademark Trial and Appeal Board had incorrectly found that PRETZEL CRISPS was a compound term. A compound term is a combination of two or more terms in ordinary grammatical construction; the Board stated that in cases where the proposed mark is a compound term, genericness may be established with evidence of the meaning of each constituent word. Under this standard, the Board found that “PRETZEL” is generic for pretzels and pretzel snacks and that “CRISPS” is generic for crackers, thus, purchasers would understand that PRETZEL CRISPS identifies pretzel crackers.

But, the Federal Circuit disagreed, stating that Board applied the wrong test and incorrectly assumed there is a dichotomy in the legal standard for genericness based on whether the proposed mark is a phrase or a compound term. The Federal Circuit clarified that the appropriate legal test is to evaluate the mark as a whole.  It noted that the record here was replete with evidence of the public perception of the term “PRETZEL CRISPS.” Concluding that the Board applied the incorrect legal standard in its genericness determination, the Federal Circuit held that on remand, the Board must consider evidence of the public’s understanding of PRETZEL CRISPS in its entirety.

In addition to finding that the Board applied the wrong standard, it also agreed that the Board failed to consider important facts, such as, that 86 percent of unsolicited media references use PRETZEL CRISPS as a brand name and declarations from participants in the snack food industry who testified that they understood PRETZEL CRISPS exclusively to refer to its products. Instead, the Board appeared to cherry pick references in the record that supported a finding of genericness such as media references and third party uses of the term “crisps” for crackers, registrations that disclaimed the term “crisps,” and dictionary definitions of “crisp.”

The Federal Circuit agreed, finding that Board gave controlling weight to the evidence it selected and appeared to overlook relevant survey evidence. The Federal Circuit also opined that the Board cannot focus primarily on the word “crisps” alone and disregard survey evidence to arrive at the conclusion that the mark is generic. The Federal Circuit held that on remand, the Board would have to give appropriate consideration to the proffered survey evidence.

The matter is now remanded to the Board for a new decision based on the correct legal standard and evidence.