Cervejaria Petropolis Sa v. Ambev S.A.

NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
CERVEJARIA PETROPOLIS SA,
Appellant
v.
AMBEV S.A.,
Appellee
______________________
2019-1132
______________________
Appeal from the United States Patent and Trademark
Office, Trademark Trial and Appeal Board in No.
92059437.
______________________
Decided: October 10, 2019
______________________
MARY CATHERINE MERZ, Merz & Associates, PC, Oak
Park, IL, for appellant.
DOUGLAS ANTHONY RETTEW, Finnegan, Washington,
DC, for appellee. Also represented by PATRICK J. RODGERS;
MORGAN ELIZABETH SMITH, Palo Alto, CA.
______________________
Before PROST, Chief Judge, MOORE and WALLACH, Circuit
Judges.
2 CERVEJARIA PETROPOLIS SA v. AMBEV S.A.
WALLACH, Circuit Judge.
Appellant Cervejaria Petropolis SA (“CP”) appeals the
opinion of the U.S. Patent and Trademark Office’s
(“USPTO”) Trademark Trial and Appeal Board (“TTAB”)
granting Appellee Ambev S.A.’s (“Ambev”) petition to can-
cel CP’s Registration No. 3788757 for the mark FUSION,
for “non-alcoholic beverage ingredients, namely, efferves-
cent powder to be dissolved in liquid to produce an energy
drink and hypertonic drink” (“the Registered Product”),
due to abandonment, pursuant to 15 U.S.C. § 1064(3)
(2012). Ambev S.A. v. Cervejaria Petropolis SA,
No. 9205943, 2018 WL 4146176, at *1, *17 (T.T.A.B. Aug.
28, 2018); 15 U.S.C. § 1064(3) (providing for the cancella-
tion of a mark “[a]t any time if the registered mark . . . has
been abandoned”). We have jurisdiction pursuant to 28
U.S.C. § 1295(a)(4)(B) (2012). We affirm.
DISCUSSION
I. Standard of Review and Legal Standard
We review the TTAB’s legal conclusions de novo and its
findings of fact for substantial evidence. Zheng Cai v. Dia-
mond Hong, Inc., 901 F.3d 1367, 1371 (Fed. Cir. 2018).
“Substantial evidence is ‘such relevant evidence as a rea-
sonable mind would accept as adequate to support a con-
clusion.’” Stone Lion Capital Partners, L.P. v. Lion Capital
LLP, 746 F.3d 1317, 1321 (Fed. Cir. 2014) (quoting Consol.
Edison Co. of N.Y. v. N.L.R.B., 305 U.S. 197, 229 (1938)).
“Where two different conclusions may be warranted based
on the evidence of record, the [TTAB’s] decision to favor one
conclusion over the other is the type of decision that must
be sustained by this court as supported by substantial evi-
dence.” In re Bayer Aktiengesellschaft, 488 F.3d 960, 970
(Fed. Cir. 2007) (citation omitted).
A trademark may be cancelled “[a]t any time if the reg-
istered mark . . . has been abandoned.” 15 U.S.C.
§ 1064(3). “Abandonment is a question of fact.” On-Line
CERVEJARIA PETROPOLIS SA v. AMBEV S.A. 3
Careline, Inc. v. Am. Online, Inc., 229 F.3d 1080, 1087 (Fed.
Cir. 2000). Under the Lanham Act, a registered trademark
may be “deemed to be ‘abandoned’” when “its use has been
discontinued with intent not to resume such use.” 15
U.S.C. § 1127. Because trademark registrations are pre-
sumed valid, the party seeking cancellation (the petitioner)
bears the burden of proving abandonment by a preponder-
ance of the evidence. See 15 U.S.C. § 1057(b) (“A certificate
of registration of a mark upon the principal regis-
ter . . . shall be prima facie evidence of the validity of the
registered mark[.]”); Cerveceria Centroamericana, S.A. v.
Cerveceria India, Inc., 892 F.2d 1021, 1023 (Fed. Cir. 1989)
(“[I]n a cancellation for abandonment . . . the petitioner
bears the burden of proof.”). The petitioner establishes a
prima facie case of abandonment by showing “[n]onuse” of
the trademark “for [three] consecutive years.” 15 U.S.C.
§ 1127; see On-Line, 229 F.3d at 1087 (“The party seeking
cancellation establishes a prima facie case of abandonment
by showing proof of nonuse for three consecutive years.”
(citing 15 U.S.C. § 1127)). This “creates a rebuttable pre-
sumption that the trademark owner has abandoned the
mark without intent to resume use.” Crash Dummy Movie,
LLC v. Mattel, Inc., 601 F.3d 1387, 1391 (Fed. Cir. 2010)
(citation omitted). The trademark owner may rebut this
presumption by “produc[ing] evidence that he either used
the mark during the statutory period or intended to resume
or commence use.” Rivard v. Linville, 133 F.3d 1446, 1449
(Fed. Cir. 1998) (citation omitted). “Use” requires “bona
fide use” of the mark on the goods recited in the registra-
tion, in the United States, “made in the ordinary course of
trade,” and “not made merely to reserve a right in a mark.”
15 U.S.C. § 1127; see In re Jobdiva, Inc., 843 F.3d 936, 940
(Fed. Cir. 2016) (“A registration may be cancelled on
grounds of abandonment when the mark has not been used
for the goods or services specified in the registration for at
least three years and there is no showing of an intent to
resume use of the mark for those goods or services.” (cita-
tions omitted)); Imperial Tobacco Ltd. v. Philip Morris,
4 CERVEJARIA PETROPOLIS SA v. AMBEV S.A.
Inc., 899 F.2d 1575, 1579 (Fed. Cir. 1990) (“The terms ‘use’
and ‘nonuse’ mean use and nonuse in the United States.”).
II. Substantial Evidence Supports the TTAB’s Determina-
tion that CP Abandoned the FUSION Mark
The TTAB found that Ambev had “established a prima
facie case of abandonment based on at least three consecu-
tive years [of] nonuse” of the FUSION mark, Ambev, 2018
WL 4146176, at *13, from “December 31, 2011 through
July 15, 2015” (that is, more than three and a half years),
id. at *17, and that CP had failed to rebut this prima facie
case, having not produced “a scintilla of evidence or testi-
mony” of intent to use or intent to resume or commence use
of the mark during the same period, id. at *16. The TTAB
concluded that CP had, accordingly, “abandoned its
[FUSION] mark.” Id. at *17. CP challenges the TTAB’s
finding, arguing that it is unsupported by substantial evi-
dence because “a reasonable person would not have agreed
with the [TTAB’s] finding that Ambev’s evidence estab-
lished abandonment for three consecutive years,” Appel-
lant’s Br. 13, and “would have found” instead, “that CP’s
evidence established an intent to resume use of the
FUSION mark,” id. at 22. We disagree with CP.
Substantial evidence supports the TTAB’s finding that
CP had not used or intended to resume use of the FUSION
mark for at least three consecutive years. In response to
Ambev’s interrogatories, CP stated that at the time it ac-
quired the FUSION mark, on October 27, 2011, it did not
intend to use the mark for the Registered Product, see
J.A. 257 (“[A]t the time it purchased the mark it wanted to
sell the related liquid rather than powder product.”), J.A.
267–70 (Trademark Rights Purchase Agreement); that “it
does not export or ship any FUSION products into the
[United States],” J.A. 256; and that it “does not advertise
or promote its FUSION product[s] in the United States,”
J.A. 257. Further, in response to Ambev’s request that CP
produce “[d]ocuments sufficient to identify” any webpage or
CERVEJARIA PETROPOLIS SA v. AMBEV S.A. 5
blog “owned or operated” by CP that “contain[ed] or dis-
play[ed]” the FUSION mark or “refer[red] or relate[d]” to
the Registered Product, CP responded that “there are no
[responsive] documents.” J.A. 276. In addition, supporting
record evidence includes: twenty-nine excerpts from CP’s
website from December 2011 through January 2016, that
make no reference to any FUSION product or FUSION
mark, J.A. 176–248; testimony from Ambev’s private inves-
tigator that she found no evidence of CP using the FUSION
mark for the Registered Product in the United States
through June 11, 2014 (the conclusion of her investigation),
J.A. 84, 103–04; and a June 30, 2011, public corporate filing
from CP’s predecessor in interest indicating that it had dis-
continued sales of its FUSION mark registered products,
J.A. 137–39. CP’s admissions, corroborated by record evi-
dence of nonuse for more than three years, is “such relevant
evidence as a reasonable mind might accept as adequate to
support [the] conclusion” that CP had not used the
FUSION mark for the statutory period. See Consol. Edi-
son, 305 U.S. at 229; Cerveceria, 892 F.2d at 1024 (“[W]hen
a party must prove a negative, as in proving abandonment
through nonuse,” an inference of nonuse is proper so long
as “the inference ha[s] an adequate foundation in proven
fact.”).
Further, the TTAB did not err in finding CP failed to
establish use or intent to resume use. During the period of
nonuse, CP provided only that it had recorded its acquisi-
tion of the FUSION mark with the USPTO, J.A. 264–70,
and, based on uncorroborated interrogatory responses,
used the FUSION mark “in connection with a pre-mixed
energy drink” beginning in October 2014, J.A. 255. This
does not establish use of the Registered Product in the or-
dinary course of trade, nor intent to resume such use. See
15 U.S.C. § 1127 (defining “use” as “bona fide use”); Impe-
rial Tobacco, 899 F.2d at 1581 (“An averment of no intent
to abandon is little more than a denial in a pleading[.]”).
CP produced evidence suggesting use of the FUSION mark
6 CERVEJARIA PETROPOLIS SA v. AMBEV S.A.
beginning July 15, 2015, after more than three and a half
consecutive years of nonuse, consisting primarily of an ad-
vertisement on a race car and driver jumpsuit at the Iowa
Corn 300, J.A. 465–94, but without offering “testimony or
evidence regarding what the FUSION mark on the
jumpsuit or racecar identifie[d],” Ambev, 2018 WL
4146176, at *15. Use of a mark for an unidentified product,
after more than three consecutive years of nonuse, without
any evidence of intent to resume use during that period,
does not establish use or intent to resume use. See Cer-
veceria, 892 F.2d at 1027–28 (holding that in the absence
of evidence of intent to resume use during the period of
non-use, the TTAB “may conclude the registrant has . . .
failed to rebut the presumption of abandonment,” even
when there is evidence of intent to resume after the period
of nonuse); Imperial Tobacco, 899 F.2d at 1582 (marketing
efforts using the registered mark, but for products other
than the registered product “did not excuse nonuse”). Ac-
cordingly, the TTAB did not err in finding CP had failed to
establish use or intent to resume use of the FUSION mark.
CP’s counterarguments are unpersuasive. First, while
CP avers that “a reasonable person would have found that
CP’s evidence established an intent to resume use of the
FUSION mark” because “CP’s evidence was substantial,”
Appellant’s Br. 22, this misapprehends the substantial ev-
idence standard of review, Consolo v. Fed. Mar. Comm’n,
383 U.S. 607, 620 (1966) (“[T]he possibility of drawing two
inconsistent conclusions from the evidence does not pre-
vent an administrative agency’s finding from being sup-
ported by substantial evidence.”), and overstates CP’s own
evidence, N.L.R.B. v. Columbian Enameling & Stamping
Co., 306 U.S. 292, 300 (1939) (“Substantial evidence is
more than a scintilla, and must do more than create a sus-
picion of the existence of the fact to be established.”).
Second, CP argues that “[t]he [TTAB] erred” when it
declined to allow CP “to introduce . . . certain of its own in-
terrogatory responses, and the documents produced in
CERVEJARIA PETROPOLIS SA v. AMBEV S.A. 7
connection therewith,” into the record. Appellant’s
Br. 9. A “responding party” may introduce its own answers
to interrogatories only if the “inquiring party” has “offered
in evidence” “fewer than all of the . . . [responding party’s]
answers,” and the additional answers “in fairness” should
be “considered so as to make not misleading” the answers
already in the record. 37 C.F.R. § 2.120(k)(5) (2007). The
“responding party” must provide a “written statement ex-
plaining why [it] needs to rely upon each of the additional
written disclosures[.]” Id. Here, while Ambev did not in-
troduce all of CP’s interrogatory answers, J.A. 249, CP did
not establish why its additional answers should “be consid-
ered” to make answers already in the record “not mislead-
ing,” 37 C.F.R. § 2.120(k)(5). CP merely asserted that
“[s]ince [CP’s] intent to use the FUSION mark and actual
use of the FUSION mark are at issue,” the answers and
“relevant documents should be considered by the [TTAB].”
J.A. 383–84. This is insufficient. CP was required to es-
tablish how the “additional written disclosures” clarified
specific interrogatory answers already introduced into the
record, to “make [them] not misleading.” 37 C.F.R. §
2.120(k)(5); see Holiday Inns, Inc. v. Monolith Enters., 212
U.S.P.Q. (BNA) 949, 1981 WL 48556, at *1 (T.T.A.B. Nov.
25, 1981) (explaining that “[i]t is not sufficient to simply
notice reliance on all of the answers . . . and expect the
[TTAB] to determine which, if any, of the answers origi-
nally relied on require explanation or clarification,” rather
“the specific answer or answers sought to be intro-
duced . . . must be pinpointed and [its] relationship” to an
existing answer on the record “must be shown”). Accord-
ingly, the TTAB did not abuse its discretion when it de-
clined to allow CP to introduce its own interrogatory
responses into the record. See 37 C.F.R. § 2.120(k)(5)
(providing that the TTAB “in its discretion, may refuse to
consider the additional written disclosures or responses”);
Crash Dummy, 601 F.3d at 1390 (explaining that we
8 CERVEJARIA PETROPOLIS SA v. AMBEV S.A.
“review[] [the TTAB’s] evidentiary rulings for an abuse of
discretion” (citation omitted)). 1
CONCLUSION
We have considered CP’s remaining arguments and
find them unpersuasive. The Opinion of the U.S. Patent
and Trademark Office’s Trademark Trial and Appeal
Board is
AFFIRMED
1 CP argues, in the alternative, that it should have
been allowed “to cure its explanation under 37 C.F.R.
§ 2.122(g).” Appellant’s Br. 12. CP did not raise this argu-
ment before the TTAB. See generally J.A. 14–21, 571, 578.
It is, accordingly, waived. See Hylete LLC v. Hybrid Ath-
letics, LLC, 931 F.3d 1170, 1175 (Fed. Cir. 2019) (holding
that arguments not raised before the TTAB, but “for the
first time on appeal,” are “waived”).