THIS OPINION IS NOT A PRECEDENT OF THE TTAB

Mailed: October 5, 2012

UNITED STATES PATENT AND TRADEMARK OFFICE

_____ Trademark Trial and Appeal Board ______ Sean Combs v. All Surface Entertainment, Inc. _____ Cancellation No. 92051490 to Registration No. 2814750 registered on February 17, 2004 _____ John A. Squires of Chadbourne & Parke LLP for Sean Combs. Gary Adelman of Meister Seelig & Felin LLP for All Surface Entertainment Inc. ______ Before Kuhlke, Quinn and Mermelstein, Administrative Trademark Judges. Opinion by Kuhlke, Administrative Trademark Judge: Petitioner, Sean Combs, seeks to cancel respondents registration for the mark DIRTY MONEY in typed form for mens and womens clothing, namely, t-shirts, sweatshirts, hats, headwear, jackets, jeans and pants.1

Registration No. 2814750, filed on March 17, 2003, issued on February 17, 2004, claiming a date of first use anywhere and a date of first use in commerce of October 10, 1994. A Section 8 affidavit was filed on October 5, 2009 and accepted on October 15, 2009.

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As grounds for cancellation, petitioner alleges that respondent has abandoned use of its mark on all of the identified goods because it has discontinued use with an intent not to resume such use. Petitioner also alleges that

he filed an application for the standard character mark DIDDY-DIRTY MONEY and that respondents registration has been cited as a bar to registration of petitioners mark.2 In its answer, respondent denies the allegations of the petition to cancel and further asserts that it has not abandoned use of its mark DIRTY MONEY. PROCEDURAL HISTORY On November 24, 2010, petitioner filed a motion for summary judgment on the claim of abandonment. Respondent

cross-moved for summary judgment in its favor on petitioners claim of abandonment and on the issue of petitioners standing. On May 13, 2011, the Board granted The Board

petitioners motion for summary judgment in part.

determined that petitioner established his standing and a prima facie case of abandonment based on respondents nonuse from February 17, 2004 to February, 2009. Thus, the sole

remaining issue for final determination is respondents

Application Serial No. 77751393, filed on June 3, 2009, for the goods clothing, namely, t-shirts, hooded sweatshirts, jackets, sweatshirts; headwear is based on an allegation of a bona fide intention to use the mark in commerce under Trademark Act Section 1(b), 15 U.S.C. 1051(b).

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rebuttal of the presumption of abandonment based on an intent to resume use. ABANDONMENT/INTENT TO RESUME USE Abandonment of a mark occurs: When its use has been discontinued with intent not to resume such use. Intent not to resume may be inferred from circumstances. Nonuse for 3 consecutive years shall be prima facie evidence of abandonment. "Use" of a mark means the bona fide use of such mark made in the ordinary course of trade, and not made merely to reserve a right in a mark. Trademark Act Section 45, 15 U.S.C. 1127. A petitioner for cancellation of a registration on the ground of abandonment bears the burden of proving such abandonment by a preponderance of evidence. Cerverceria

Centroamericana S.A. v. Cerveceria India Inc., 892 F.2d 1021, 13 USPQ2d 1307 (Fed. Cir. 1989). However, [o]nce a

prima facie case is established, this eliminates the challengers burden to establish the intent element of abandonment as an initial part of [his] case, and creates a rebuttable presumption that the registrant abandoned the mark without intent to resume or commence use under the statute. This presumption shifts the burden to the

registrant to produce evidence that he either used the mark during the statutory period or intended to resume or commence use. The burden of persuasion, however, always

remains with the petitioner to prove abandonment by a preponderance of evidence. Rivard v. Linville, 133 F.3d 3

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1446, 45 USPQ2d 1374 (Fed. Cir. 1998) citing, Imperial Tobacco Ltd. v. Philip Morris, 899 F.2d 1575, 14 USPQ2d 1390, 1395 (Fed. Cir. 1990). Finally, mere proclamations of

intent to resume use or commence use during the period of nonuse are given little, if any, weight. Id.

To show an intent to resume use, a respondent must put forth evidence with respect to either specific activities undertaken during the period of nonuse or special circumstances which excuse nonuse. USPQ2d at 1394. See Imperial Tobacco, 14

See also Rivard, 45 USPQ2d at 1376 (To

provide excusable nonuse, the registrant must produce evidence showing that, under his particular circumstances, his activities are those that a reasonable businessman, who had a bona fide intent to use the mark in United States commerce, would have undertaken.) A mere affirmative

desire by the registrant not to relinquish a mark is not determinative of the intent element of abandonment under the Lanham Act. Imperial Tobacco, 14 USPQ2d at 1394. To

satisfy its burden of production, respondent must come forward with evidence beyond mere conclusory statements or denials that it lacks such intent to resume use. 1394-95. Id. at

See also Rivard, 45 USPQ2d 1374 (Court upheld the

Boards finding that evidence of several trips to the United States to establish hair dressing and beauty salons and contact with a franchising consultant was insufficient to

Cancellation No. 92051490

support an intent to commence use of the mark and the registrant did not show that the nonuse of the mark during this period was reasonable.) Finally, in order to rebut the prima facie case, respondent must produce evidence of an intent to resume use during the relevant time period, i.e., the period of nonuse. See Imperial Tobacco, 14 USPQ2d at 1394-95. Subsequent use

may be probative of whether the registrant intended to resume use during a previous period of nonuse. Such

evidence should temporally and logically link the later use to the prior nonuse, such that an inference can be drawn regarding the intent to use during the period of nonuse. Without more, mere evidence of subsequent use may not suffice to establish that the registrant intended to resume use. Parfums Nautee Ltd. v. American International Once a

Industries, 22 USPQ2d 1306, 1310 (TTAB 1992).

trademark is abandoned, its registration may be cancelled even if the registrant resumes use. Cerveceria, 13 USPQ2d

at 1313 n. 7, quoting, Mission Dry Corp. v. Seven-up Co., 193 F.2d 201, 92 USPQ 144, 146 (CCPA 1951). It is respondents position that it never intended not to resume use and has valid reasons for any periods of nonuse, including a purposeful effort to launch the brand at a time when the climate of the street wear community would be receptive to such a brand and the limited ability of

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respondents president to focus on the brand while producing another brand at the same time. Respondent contends that

the evidence in the record unequivocally demonstrates that during all periods of non-use [respondent] maintained an intent to resume use and had excusable reasons for nonuse.3 Resp. Br. p. 1.

To meet its burden, respondent submitted trial testimony (with accompanying exhibits) of its president Aaron LaCanfora (LaCanfora Test.). We first note that the

bulk of Mr. LaCanforas testimony and exhibits relate to activities occurring in 2003 and earlier, i.e., prior to the beginning of the 2004-2009 nonuse period. In addition, much

of the testimony and exhibits pertain to use of a mark (MILKCRATE) that is not the subject of this proceeding. Respondent asserts that the following actions illustrate the intent to resume use of the trademark: searching for and negotiating with potential licensing partners and brand spokespersons; researching ways to introduce new collections of the brand; test marketing new t-shirt and hat designs; pursuing infringers; renewing

Respondent also asserts that even if Petitioner could persuade the Board that [respondent] had abandoned the mark at some time prior to February of 2009, [respondent] has resumed use prior to petitioner and as such maintains priority. Resp. Br. p. 1. As discussed infra, priority is not an issue in this case, and once abandonment has occurred, subsequent use is considered a new and separate use and does not serve to obviate the abandonment.

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registration of the trademark; and actually resuming use of the trademark. Resp. Br. p. 16. We first find that respondent never commenced use of the mark on sweatshirts, jackets, jeans and pants prior to 2008/2009. LaCanfora Test. p. 213 (Q. Okay. So up until A. And hats.

that time [2009] there was T-shirts and hats? Q. And nothing else? A. No.).4

Moreover, prior to the

nonuse period beginning on February 17, 2004 his use on tshirts and hats was minimal and sporadic. From the time Mr.

LaCanfora conceived of the Dirty Money idea in 1994 to the end of the 90s he sold approximately three dozen t-shirts. LaCanfora Test. p. 185. In 2003, [Mr. LaCanfora] kind of

had already reintroduced [DIRTY MONEY] and it was bubbling again and [he] was selling it around here and there again. LaCanfora Test. p. 178. In 2003, respondent only sold six

hats and a dozen t-shirts with DIRTY MONEY displayed on them. LaCanfora Test. pp. 179-180.

Turning now to respondents asserted actions, we address each activity in turn. Respondent asserts that Mr.

LaCanfora continuously searched for licensing partners and spokespersons to launch the DIRTY MONEY brand. 17. Resp. Br. p.

This search includes negotiations and discussions with

While the claim of nonuse to support a Section 1(a) application was not pleaded, these facts contribute to the body of evidence regarding respondents intent to resume use, in particular as to the question of respondents constancy of effort.

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Damon Dash, Neil Mossburg, Pharrell Williams, Kanye West, and people in sales at the Magic trade show in Las Vegas (Magic). Resp. Br. pp. 17-18. However, the testimony

regarding the search for licensing partners and a spokesperson is vague and inconsistent, and not corroborated by testimony of others. The only documentary evidence

consists of a notebook of handwritten notes and a copy of one facsimile sent to Damon Dash. The negotiations with Damon Dash occurred in 2003, prior to the abandonment period (and prior to registration). He testifies that early 2003 to mid-summer 2003 was the heart of the Dirty Money deal and during this time on May 13, 2003, he faxed a proposed license deal to Damon Dash. LaCanfora Test. pp. 77, 98, Exhibit E. The testimony

regarding the end of negotiations with Damon Dash is inconsistent. During direct examination, Mr. LaCanfora

testifies that the negotiations with Damon Dash ended in August of 2003. LaCanfora Test. p. 102. However, during

cross-examination, Mr. LaCanfora testifies that the negotiations ended in the beginning of 2004. Test. pg. 187. LaCanfora Even if

Thus, the duration remains unclear.

the later date of the beginning of 2004 is believed, this vague date appears to coincide with the trademark registration date. Similarly, talks with Pharrell Williams

and Kanye West to become spokespersons for the brand also

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occurred in 2003.

LaCanfora Test. pp. 95 and 113.

Thus,

all of these discussions occurred prior to the beginning of the nonuse period. In 2004, Mr. LaCanfora had conversations with another person, Neil Mossburg, to discuss working out a deal. Neil

Mossburg is an exhibitor and buyer at the Magic trade show. LaCanfora Test. p. 194. Mr. LaCanfora testifies that the

discussions with Neil Mossburg continued from 2004-2005 and broke down in 2006. LaCanfora Test. pg. 113. However, on

cross-examination, Mr. LaCanfora states there were at most three meetings with Mr. Mossburg and that these meetings began with Mr. Mossburg approaching Mr. LaCanfora to design a line of t-shirts and Mr. LaCanfora brought up the DIRTY MONEY brand. LaCanfora Test. pg. 194-196. This amounts to

three conversations over the course of three years and no indication of how much of these conversations related to the DIRTY MONEY brand. As the witness recounts, they spoke a LaCanfora Test. p. 196. He

couple of times and moved on.

testifies that Mr. Mossberg didnt want to invest any money ... and that wasnt something that was a feasible offer for Dirty Money and that these negotiations broke down in 2006. LaCanfora Test. p. 114.

Between 2004 and 2009, Mr. LaCanfora testifies that he attended the Magic trade show where he had designs that [he] was test marketing through Milkcrate... LaCanfora

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Test. p. 111. brand.

His booth at Magic was under the MILKCRATE Mr. LaCanfora describes the

LaCanfora Test. p. 199.

test marketing as follows: Dirty Money is a brand name, but Dirty Money is a very different aggressive, more aggressive design style than Milkcrate is. So I would do some designs that were more aggressive and more Dirty Money style designs within the Milkcrate collection to show them to buyers and to show them to magazine editors and people to get an idea if the brand if someone leaps out at something then I get an idea that the market is turning towards more aggressive style hip hop clothing. LaCanfora Test. p. 118. At the Magic trade show during 2003-2007 he was still steadily putting a few designs here and there in the Milkcrate collection and seeing how they would work, getting an idea and it, you know it still was it came back to me once again the time was not right and Dirty Money was still ahead of its time. LaCanfora Test. p. 198 (he was

continuously shopping [Dirty Money] and managing it and trying to get people interested in it, but the market was not there. People were not interested in that yet.).

Again, the testimony regarding interaction with sales people at Magic is very vague. Specifically, Mr. LaCanfora

testifies that he met with many people at the Magic show, various sales reps, various other brands at the time. I was

very vocal in trying to collaborate and to take the DIRTY MONEY brand to another level. LaCanfora Test. p. 112.

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This testimony does not include a specific timeframe or names of individuals with whom Mr. LaCanfora engaged in licensing negotiations, or even that it was for the benefit of respondent rather than Mr. LaCanforas other company Milkcrate, Inc. Respondent also testifies to presenting new

designs for DIRTY MONEY, but Mr. LaCanfora testifies that these new designs were featured under the MilkCrate collection. LaCanfora Test. pgs. 117-118. No documentary

evidence, such as copies of the designs that were presented (prior to the 2008 designs) have been provided. Nor has

respondent provided evidence that this constitutes industry practice to test market the goods in this manner. Respondent points to its policing efforts as evidence of an intent to resume use, which consists of one cease and desist letter sent in 2006. Respondent admits that the 2006

cease and desist letter was sent in response to a request from a third party to purchase the DIRTY MONEY mark. LaCanfora Test. p. 114. The only other policing effort was

the cease and desist letter sent in 2010 to petitioner, which is outside of the relevant time period and subsequent to the filing of this petition. LaCanfora Test. p. 151.

Finally, sometime in 2008, Mr. LaCanfora was approached by the cable television network Home Box Office (HBO) to design a collection of clothing for the television show The Wire. LaCanfora Test. p. 24. Mr. LaCanfora testified that

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they were familiar with the MILKCRATE brand (LaCanfora Test. p. 24) but did not provide testimony as to the DIRTY MONEY brand on this point. He further testifies that he:

... designed new Dirty Money T-shirts that were Milkcrate branded they were Milkcrate Dirty Money brand shirts. And I also had The Wire HBO Milkcrate collaboration shirts, and I said and I launched them at the same time as a marketing objective to show the public that HBO is interested in Milkcrate and HBO is also interested in Dirty Money, and this is the brand that youve been seeing slowly evolve and this is the brand Ive been pushing for the past 17 years and no HBO its a fit. LaCanfora Test. p. 120. Regarding the HBO collaboration, he testifies that It took a year to negotiate the deal and in 2009 is when we first introduced The Wire at Magic. 230. LaCanfora Test. p.

An example of the 2009 design is set forth below:

LaCanfora Test. Exhibit I.

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Mr. LaCanfora testifies that in February 2009 t-shirts with the DIRTY MONEY design were sold. 121, 124. LaCanfora Test. p.

We note that the invoice submitted to support

this testimony is from Milkcrate Athletics, Inc., Mr. LaCanforas other company, not respondent, All Surface Entertainment, Inc. See LaCanfora Test. Exhibit J. See The

2010 invoices appear to come from Dirty Money. LaCanfora Test. Exhibit N.

In order to show an intent to resume use one must ... proffer more than conclusory testimony or affidavits. Imperial Tobacco Ltd., 14 USPQ2d at 1394. Taken as a whole,

this record does not include evidence of activities during the nonuse period to support an intent to resume use. The

bulk of the testimony and evidence relates to activities prior to the relevant time period or to respondents other brand, Milkcrate Athletics. The remaining evidence consists

of testimony that is vague, inconsistent, and insufficiently supported by documentary evidence or testimony other than by respondent. To support its position, respondent relies on Sands, Taylor, & Wood v. Quaker Oats Co., 18 USPQ2d 1457 (N.D. Ill. 1990) and Crash Dummy Movie, LLC v. Mattel, Inc., 601 F.3d 1387, 94 USPQ2d 1315, 1319-20 (Fed. Cir. 2010). These cases In

are distinguished on their facts from the present case.

the Sands, Taylor & Wood Co. case, the plaintiffs efforts

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included: maintaining a file of beverage producers that might be interested in the trademark; preparing a letter to soft drink companies regarding the trademark; contacting a food broker who in return prepared a list of proposed companies; and contacting public relations firms and other marketing persons and a business school regarding how to use the trademark. In Crash Dummy Movie, in addition to the

licensing efforts, the Federal Circuit noted that the Board relied on substantial evidence and testimony of research and development efforts to indicate an intent to resume use. However, the vague testimony regarding weak intermittent efforts and lack of sufficient supporting evidence submitted in this case are more in line with other cases where abandonment was found. See Rivard, 45 USPQ2d at

1383 (abandonment found where registrant submitted evidence regarding sporadic trips to investigate potential sites for salons and half-hearted attempts to initiate the business relationships necessary to open a salon); Natural Answers, Inc. v. Smithkline Beecham Corp. 529 F.3d 1325, 87 USPQ2d 1200, 1210 (11th Cir. 2008) (no valid trademark found where plaintiff provided only a bare assertion by its CEO of an intent to resume use if funding was found, an unsupported assertion that another company wanted more information regarding a joint venture and no evidence of actual and concrete plans to resume use).

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Respondent also argues that valid reasons exist for any periods of non-use. Intent to resume use in abandonment

cases has been equated with a showing of special circumstances which excuse a registrants nonuse. Tobacco, 14 USPQ2d at 1395. Imperial

The reasons for nonuse provided

by respondent include the decision to wait to launch new collections until such time that the brand would be wellreceived; respondents limited capabilities; the need for help with advertising and funding; and need for a licensing partner. Resp. Br. pg. 25.

Mr. LaCanfora testifies that the brand was ahead of its time and that he needed to wait to present the brand when it would be well-received. LaCanfora Test. p. 116. Respondent

also points to its limited capabilities which required help with advertising and funding and/or a licensing partner. Resp. Br. p. 25. However, respondent has provided no

documentary evidence or outside testimony to support either of these reasons. The only support for these excuses for

nonuse is respondents own testimony and handwritten notes. The Federal Circuit affirmed the Boards finding of abandonment in the Rivard case, noting that while he used his own business judgment in deciding not to open salons during this period, not every business reason excuses nonuse. Rivard, 45 USPQ2d at 1385. Similarly,

respondents excuses consist only of respondents own

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business judgment about consumer preferences and the manner in which it desired to launch its brand, and not as a special circumstance brought on by outside forces. Imperial Tobacco, 14 USPQ2d at 1395, citing, Miller Brewing Co. v. Olands Breweries Ltd., 548 F.2d 349, 192 USPQ 266, 268 (CCPA 1976) (modernization of equipment and strike by employees constituted special circumstances). Furthermore, respondents own actions belie its contentions that the mark could not be used without additional resources. Initial attempts in 1994 to use the

trademark included respondents drawing the mark on the goods by hand with a Sharpie pen or airbrushing the mark on the goods and selling limited numbers of goods. Test. pp. 10 and 165. Further, when the mark was LaCanfora

reintroduced in 2003, when respondent filed the trademark application, the same basic design was used which only featured block lettering on a basic t-shirt and trucker hat. LaCanfora Test. p. 180, Exhibit B. In addition, Mr.

LaCanfora testifies that in 2003 he had a screen printer so he could mass produce. LaCanfora Test. p. 193. By

contrast, respondent has not produced evidence of outside events that prompted a ceasing of effort to produce the simple basic design in the years of nonuse. Respondents actions with the later created MILKCRATE brand also belie a need for additional resources to utilize

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a mark on clothing items.

Mr. LaCanfora testifies that,

through his other company, Milkcrate Athletics, Inc., he design[s], manufacture[s], produce[s], and ship[s] clothing. LaCanfora Test. p. 9. In addition, as to the

MILKCRATE brand, Mr. LaCanfora testifies that it is financed independently. Id. He also testifies that he has

successfully promoted and sold his MILKCRATE branded clothing line worldwide and has sold merchandise under that brand every year since 1997. LaCanfora Test. p. 19. In

short, respondent has been able to successfully build the MILKCRATE brand during the same time period without partners or additional funding.5 Finally, once Mr. LaCanfora did

resume use of the DIRTY MONEY designs he did so without advertising or funding assistance or a licensing partner. This evidence indicates it was possible to have done so all along. In the case law cited by respondent, the business reasons included fear of warranties implied by use of the mark on the goods where those goods may not meet the warranty and a magazine company that discontinued a line of t-shirts until a new vehicle was found to offer them for sale, namely, an internal sales catalog. See Poncy v.

Johnson & Johnson, 460 F.Supp. 795 (D.N.J. 1978); Ithaca

From page 13 to page 54 Mr. LaCanforas testimony pertains only to the MILKCRATE brand and his continuous successful marketing of clothing under this brand since at least 1997.

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Indus., Inc. v. Essence Communications, Inc. 706 F.Supp. 1195 (W.D.N.C. 1986). Even in the Crash Dummy Movie case,

the business reasons for nonuse included the time needed to merge Tycos line of toys into Mattel and the cost necessary to meet safety standards, which were shown through testimony as well as documentary evidence. LLC, 94 USPQ2d at 1318. However, here the reasons provided are based on respondents own business judgment without documentary support regarding those reasons or industry practice. [N]ot every business reason excuses nonuse. Linville, 45 USPQ 2d 1374, 1377. Rivard v. The Crash Dummy Movie,

In fact, he testifies that

such a long delay (2003-2009) between developing the design and launching a brand is not standard for the industry. He

explains that it simply shows how ahead of the time Dirty Money is. LaCanfora Test. p. 134.

Taken as a whole the record shows at most that for seventeen years he waited for the market to catch up to the DIRTY MONEY idea, while he devoted his time, money and efforts (LaCanfora Test. p. 57) to the MILKCRATE brand. While respondents hopes may have been eventually to enter into a particular deal to make a large relaunch, there was nothing preventing respondent from continuing use of its brand during this time, as demonstrated by Mr. LaCanforas continuing use of the MILKCRATE brand. This describes a

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business choice to go forward with one brand and warehousing the other brand. Finally, respondent incorrectly asserts that the resumption of use prior to the time petitioner filed its application makes the issue of abandonment moot. Respondent

cites to cases involving the issue of prior rights to a mark where the abandonment of a plaintiffs asserted common law mark was deemed irrelevant in view of the subsequent use prior to the defendants first use. However, the issue of

priority between the parties is not in issue in this proceeding where the only claim is abandonment.6 Once

deemed abandoned, a registration will be cancelled even if registrant later resumes commercial use. Cerveceria, 13

USPQ2d at 1313, n.7 citing Mission Dry Corp., 92 USPQ at 146. Re-adoption of a mark after abandonment represents a

new and separate use and cannot cure the abandonment. Parfums Nautee Ltd., 22 USPQ2d at 1310.

As discussed above petitioners standing is already established and it was based on the refusal of its application because of the registration which is the subject of this proceeding, i.e., not based on prior rights. May 13, 2011, Board Order pp. 8-9. The question of prior rights between the parties would be relevant in case involving a claim of likelihood of confusion under Section 2(d) of the Trademark Act, 15 U.S.C. 1052(d). Whether or not respondents renewed use is (1) use sufficient to constitute common law trademark use, and (2) prior to petitioners first use or constructive use based on petitioners application filing date is not before us in this proceeding brought on the claim of abandonment and concerned solely with the ability to maintain the current registration.

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The testimony indicates that in November 2008, respondent designed new clothing items bearing the DIRTY MONEY trademark to be used in connection with The Wire collection shown in early 2009. Exhibit S. LaCanfora Test. p. 158,

However, even if we were to find this testimony

sufficient to establish use of the mark at that time, the evidence submitted is insufficient to show an intent to resume use in 2004, 2005, 2006, and 2007. Taking into

consideration the entire record, respondent abandoned its registration by virtue of its nonuse and has failed to meet its burden of production to rebut the presumption of abandonment. Certainly, the record does not reveal a constancy of effort in marketing the clothing brand DIRTY MONEY which would show an intention to resume meaningful commercial use of the mark between, at least, 2004 and early 2008. To the extent the use in 2009 is

sufficient trademark use to support a registration, it occurred after the abandonment of the mark, and does not reflect continuing efforts to resume use through the period of nonuse. In view thereof, petitioner has met its burden to establish that respondent abandoned the mark DIRTY MONEY.

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Decision: granted.

The petition for cancellation is

Registration No. 2814750 will be cancelled in

due course.

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