Kelly Servs. v. Creative Harbor, LLC - 846 F.3d 857 (6th Cir. 2017)

Rule:

Lack of a bona fide intent is proper statutory grounds on which to challenge a trademark application. Lanham Act § 1(b) (15 U.S.C.S. § 1051(b)) explicitly requires that an intent-to-use (ITU) applicant have a bona fide intent to use the mark in commerce as to the goods and services listed in the application. Therefore, a lack of bona fide intent is a proper ground on which to oppose an ITU application.

Facts:

Defendant Creative Harbor and Kelly Services, Inc. are the parties in dispute. In essence, they dispute which of them should have priority to the trademark WORKWIRE ("the Mark"), which both wish to use in connection with their competing employment-based software applications. In September 2013, Jurgensen allegedly developed an idea for a mobile application designed to connect employers with prospective employees. Jurgensen decided to call the application "WorkWire," and formed Creative Harbor in February 2014 to develop the WorkWire application. In early 2014, Creative Harbor hired an intellectual property attorney to explore obtaining the WORKWIRE trademark. That attorney allegedly advised Creative Harbor that the Mark was available. However, in early 2013, Kelly Services allegedly began developing its own employment-based iPad application, which it intended to distribute through the Apple App Store. Kelly Services also decided to name its application "WorkWire." Kelly Services allegedly completed this iPad application on February 4, 2014, and submitted the application to Apple for its approval and eventual distribution. On February 17, 2014, Apple approved Kelly Services' application, but did not release it on the App Store immediately. On February 19, 2014, Creative Harbor filed two trademark applications seeking rights to the Mark with the United States Patent and Trademark Office at 6:28 p.m. and 7:56 p.m. Eastern Standard Time, respectively (the Applications). Creative Harbor affirmed under penalty of perjury that it possessed a bona fide intention to use the Mark in commerce on or in connection with each of the goods and services listed in the Applications. On the same day, at approximately 8:11 p.m. Eastern Standard Time, Kelly Services' iPad application became available on the Apple App Store. A customer first downloaded the Kelly Services application on February 20, 2014. On March 10, 2014, Creative Harbor sent Kelly Services a cease and desist letter asserting its right to use the Mark, and demanding that Kelly Services cease using the WORKWIRE name in connection with Kelly Services' Apple App Store iPad application. Kelly Services responded to that letter by bringing suit against Creative Harbor in the United States District Court for the Eastern District of Michigan. In its complaint, Kelly Services sought a declaratory judgment, inter alia, that: (1) it possessed superior rights to the Mark; (2) it had not infringed on Creative Harbor's rights to the Mark; and (3) Creative Harbor's rights to the Mark were invalid. Creative Harbor filed a counterclaim and sought a declaratory judgment that it had priority rights to the Mark over Kelly Services because it filed the Applications before Kelly Services began using the Mark in commerce. In roughly mid-August 2014, when the Patent and Trademark Office published the Applications for opposition, Kelly Services promptly opposed the applications, notified the Trademark Trial and Appeal Board ("TTAB") of the pending action before the district court, and moved to stay the TTAB proceedings pending resolution of the instant suit. The TTAB consolidated the oppositions and stayed the proceedings.

Issue:

Did Creative Harbor lack a bona fide intention to use its requested mark in commerce with respect to some of the goods and services identified in its trademark applications, in violation of § 1(b) of the Lanham Act, 15 U.S.C. § 1051(b)?

Answer:

Yes

Conclusion:

Although a trademark applicant presented adequate evidence on summary judgment to show it had bona fide intent under 15 U.S.C.S. § 1051(b)(1) to use the mark in connection with some of the goods and services listed in its applications, the applicant lacked a firm intention to use the mark as to other goods and services it listed. An evidentiary challenge to the consideration of an officer's deposition testimony was not preserved for review, and in any event Fed. R. Civ. P. 32(a)(3) made the testimony binding on the company. The absence of bona fide intent as to some, but not all, of the goods and services did not warrant voiding the applications in their entirety absent fraud or other egregious conduct. A remand was appropriate to determine all of the goods and services for which bona fide intent was lacking and to excise overbroad portions of the applications.