229 F.3d 1080 (Fed. Cir. 2000), 99-1432, On-Line Careline Inc. v. America Online Inc.

Docket Nº:99-1432
Citation:229 F.3d 1080
Party Name:ON-LINE CARELINE, INC., Appellant, v. AMERICA ONLINE, INC., (substituted for CompuServe, Inc.), Appellee.
Case Date:October 10, 2000
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit
 
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Page 1080

229 F.3d 1080 (Fed. Cir. 2000)

ON-LINE CARELINE, INC., Appellant,

v.

AMERICA ONLINE, INC., (substituted for CompuServe, Inc.), Appellee.

99-1432

United States Court of Appeals, Federal Circuit

October 10, 2000

Appealed from: Patent and Trademark Office Trademark Trial and Appeal Board

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[Copyrighted Material Omitted]

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L. Dan Tucker, Lock, Liddell & Sapp, of Dallas, Texas, argued for appellant. With him on the brief was Kristin Jordan Harkins.

Michael A. Grow, Arent, Fox, Kintner, Plotkin & Kahn, of Washington, DC, argued for appellee.

Before PLAGER, LOURIE, and GAJARSA, Circuit Judges.

GAJARSA, Circuit Judge.

DECISION

On-Line Careline, Inc. appeals from two decisions of the U.S. Patent and Trademark Office Trademark Trial and Appeal Board ("TTAB"). First, On-Line Careline appeals from the March 23, 1999 decision of the TTAB sustaining an opposition by America Online, Inc. ("AOL") against On-Line Careline's service mark based on a finding of likelihood of confusion. CompuServe, Inc. v. Online Careline, Inc., No. 98,117, 1999 WL 181,156 (TTAB Mar. 23, 1999). On-Line Careline also appeals from the TTAB's March 30, 1999 decision denying its petition to cancel AOL's service mark. On-Line Careline, Inc. v. America Online, Inc., No. 25,193, 1999 WL 180,844 (TTAB Mar. 30, 1999). We granted Appellee AOL's motion to consolidate the two appeals. For the reasons discussed below, we affirm both decisions of the TTAB.

BACKGROUND

Appellant On-Line Careline is an Internet service provider. Marketed under the name "ON-LINE TODAY," On-Line Careline's service provides personal computer ("PC") users with direct physical connection to the Internet via point-to-point protocol ("PPP"). To obtain connection to the Internet, customers pre-set the PPP dialer on their PCs to connect to On-Line Careline's Internet protocol address. The user's PC dials into On-Line Careline's bank of modems, and upon verification of the user's ID and password, the user is able to view Internet sites or use services such as e-mail. Because On-Line Careline only provides physical connection to the Internet, its customers obtain these services from other independent sources.

Appellee AOL1 provides direct physical connection to the Internet in essentially the same manner as On-Line Careline. Marketed under the name "CompuServe Information Service," the service also provides online features such as news, information, banking, shopping, and e-mail. One of AOL's informational features is an electronic publication called "ONLINE TODAY."

The mark ONLINE TODAY was first used by CompuServe in 1983 as the name of its printed magazine. In September 1984, CompuServe began to use ONLINE TODAY in connection with online computer services, specifically, an electronic version of its printed magazine. The printed and electronic versions coexisted until 1990. Since then, ONLINE TODAY has been used only in connection with the electronic service.

On-Line Careline's first use of ON-LINE TODAY occurred between late 1992 and early 1993. The company was in its start-up phase and ON-LINE TODAY was used in the business plan as its trade name. In late 1993, On-Line Careline sought to register "ON-LINE TODAY" with the U.S. Patent and Trademark Office ("the PTO") for "services in the nature of interactive electronic communication of information, including providing interactive advice and counseling via computer

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usage over telephone lines." In February 1995, the company made its first sale of services under the name ON-LINE TODAY. The PTO issued a Notice of Publication for the proposed mark on April 7, 1995 that stated that if no opposition was filed within the specified time period, a notice of allowance would be issued.

After the PTO published the mark in the Official Gazette, CompuServe filed a timely Notice of Opposition on July 21, 1995. As grounds for opposition, CompuServe asserted that it had continuously used the mark ONLINE TODAY in connection with online computer services long before On-Line Careline had filed its application. Further, CompuServe pleaded that the services it offered under the ONLINE TODAY mark were closely related to the services specified in On-Line Careline's application, and that confusion was likely because On-Line Careline's mark was similar to its own mark.

On November 4, 1996, the two parties stipulated to an amendment of the application. On-Line Careline filed a Consented Agreement of Application with the TTAB, seeking to amend the identification of services to simply "providing internet access." The TTAB, however, denied without prejudice the proposed amendment because the word "Internet" was a registered mark, and "providing internet access" was indefinite as to the specific services. On February 20, 1997, On-Line Careline filed a second Consented Agreement of Application. The identification of services was amended to "[p]roviding telecommunications connections to a global computer network in International Class 38." The TTAB granted this second consented motion to extend, with the provision that On-Line Careline's mark was to be republished for opposition in International Class 38 if On-Line Careline was to ultimately prevail in this opposition.

In the meantime, CompuServe was issued Registration No. 1,938,569 on November 28, 1995 for the mark ONLINE TODAY for "providing access to online computer services offering computer-industry news, commentary and product reviews." The registration was issued approximately seven months after the PTO had sent the Notice of Publication to On-Line Careline. On May 31, 1996, On-Line Careline petitioned for cancellation of CompuServe's ONLINE TODAY mark. As grounds for cancellation, On-Line Careline asserted that it was using the mark ON-LINE TODAY in connection with "services in the nature of interactive electronic communication of information, namely providing information in the fields of financial, news, sports, weather and general information and in providing round table discussions whereby users communicate their opinions on topics and in providing internet access." Further, On-Line Careline asserted that CompuServe was not using the registered mark ONLINE TODAY for the services set forth in the registration, thereby abandoning its mark.

On May 14, 1998, the TTAB held a hearing with respect to the opposition proceeding. The TTAB determined that there was a likelihood of confusion between the two marks and denied registration of On-Line Careline's mark. CompuServe, Inc. v. Online Careline, Inc., No. 98,117, 1999 WL 181,156, at *2 (TTAB Mar. 23, 1999). The TTAB found that the two marks were "virtually identical," and the services associated with the marks were "closely related." Id. at *3. In particular, the TTAB noted that because CompuServe provided both physical Internet connection and online services, prospective customers have reason to expect both services to be available from a single source. Id. The TTAB rejected On-Line Careline's argument that because the purchasers of Internet services are knowledgeable and sophisticated, confusion was not likely. The TTAB noted that with the broad proliferation of computers into homes, schools, and businesses, not all customers are necessarily knowledgeable enough to distinguish between the two marks and their respective

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services. Id. Further, On-Line Careline pointed to the fact that no actual confusion had occurred in the years the two marks were used in commerce. The TTAB, however, found the argument to be unpersuasive, noting that the test is whether confusion is likely, and not whether it has actually occurred. Id. (citing Gillette Canada, Inc. v. Ranir, 23 USPQ2d 1768 (TTAB 1992)).

The hearing for the cancellation proceeding was held on June 25, 1998, during which AOL was substituted for CompuServe. The TTAB denied On-Line Careline's petition to cancel AOL's ONLINE TODAY mark, finding that On-Line Careline had not established that AOL had abandoned its registered mark. On-Line Careline, Inc. v. America Online, Inc., No. 25,193, 1999 WL 180,844, at *2 (TTAB. Mar. 30, 1999). The TTAB rejected On-Line Careline's argument that because the ONLINE TODAY mark was merely a menu item, AOL was not using the mark in connection with the services specified in the registration. See id. The TTAB reasoned that because menu items are the mechanisms by which users access a particular service--in this case, by providing access to online computer information--the description of services in the registration was accurate. See id. at *3. On-Line Careline appeals both decisions of the TTAB.

DISCUSSION

A.Likelihood of Confusion

We first address the issue pertaining to likelihood of confusion. The PTO may refuse to register a trademark if it so resembles a previously registered mark "as to be likely, when used on or in connection with the goods of the applicant, to cause confusion, or to cause mistake, or to deceive." 15 U.S.C. § 1052(d) (1994). Whether a likelihood of confusion exists between two marks is determined on a case-by-case basis, aided by the application of the factors set out in In re E.I. DuPont DeNemours & Co., 476 F.2d 1357, 1361, 177 USPQ 563, 567 (C.C.P.A. 1973).

The DuPont factors are as follows: (1) the similarity or dissimilarity of the marks in their entireties as to appearance, sound, connotation and commercial impression; (2) the similarity or dissimilarity and nature of the goods described in the application or registration of the mark, or in connection with which a prior mark is in use; (3) the similarity or dissimilarity of established, likely-to-continue trade channels; (4) the conditions under which and the buyers to whom sales are made; (5) the fame of the prior mark; (6) the number and nature of similar marks in use on similar goods; (7) the nature and extent...

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