The Federal Circuit’s recent decision in Apex Bank v. CC Serve Corp. serves as a pointed reminder to the Trademark Trial and Appeal Board (TTAB) that it must maintain consistency across its DuPont factor analysis. While the appellate panel affirmed the TTAB’s finding that the parties’ services were highly similar, it vacated and remanded the TTAB’s analysis of two critical factors after finding the board applied inconsistent standards for determining what constitutes “similar” services.
Link to Background: A Tale of Two ASPIRE Marks Background: A Tale of Two ASPIRE Marks
CC Serve Corp. has owned the registered trademark ASPIRE for credit card services since 1998, with a priority date of October 1996. The company partners with banks to issue ASPIRE-branded credit cards, with CC Serve and its affiliates handling account servicing.
Apex Bank, a Tennessee retail bank with 18 branch locations, filed intent-to-use applications in August 2019 for ASPIRE BANK word and design marks covering “banking and financing services.” Apex Bank planned to use these marks for a new internet banking venture under a different brand. Notably, Apex does not currently offer credit cards. Despite CC Serve’s letters of protest during prosecution, the examining attorney at the USPTO approved Apex Bank’s marks for publication.
CC Serve promptly filed an opposition in February 2020, alleging likelihood of confusion with its ASPIRE mark.
Link to The Federal Circuit’s Analysis: When Similar Isn’t Similar Enough The Federal Circuit’s Analysis: When Similar Isn’t Similar Enough
An opposition requires the TTAB to determine whether registration of the opposed mark should be refused on the basis that “confusion is likely because of concurrent use of the marks of an applicant and a prior user on their respective goods.” Likelihood of confusion is a question of law “based on findings of relevant underlying facts, namely findings under the [13] DuPont factors.” The TTAB is not required to consider all 13 DuPont factors; rather, it must only consider those DuPont factors that are relevant and of record. Here, the TTAB held that the sixth DuPont factor did not weigh in favor of Apex and the first and second DuPont factors weigh in favor of CC Serve. On this basis, the TTAB concluded that consumer confusion was likely and sustained the opposition under Section 2(d) of the Lanham Act.
On appeal, Apex argued that the TTAB erred in its analysis, specifically with respect to these three factors. While the appellate panel affirmed the TTAB’s analysis of the second DuPont factor, which assesses similarity of goods and services, it was troubled by the inconsistencies in the TTAB’s approach to the remaining factors.
Link to Second DuPont Factor – Services Similarity: Affirmed Second DuPont Factor – Services Similarity: Affirmed
The Federal Circuit found no error in the TTAB’s analysis of the second DuPont factor, which assesses similarity of goods and services. Indeed, the appellate panel found that the TTAB had carefully examined the relationship between credit card services and banking/financing services, ultimately determining they were “legally identical, in part.” The board noted that dictionary definitions of “banking” and “finance” encompass extending credit through credit card issuance, and supported this finding with third-party registrations covering both types of services.
Link to Sixth DuPont Factor – Third-Party Use: The Inconsistency Problem Sixth DuPont Factor – Third-Party Use: The Inconsistency Problem
The sixth DuPont factor considers the number and nature of similar marks used on similar goods or services. Evidence of widespread third-party use can demonstrate that a mark is weak and entitled to only narrow protection, as consumers become more adept at distinguishing between similar marks in crowded fields.
Here’s where the board stumbled. Apex had submitted evidence of 42 third-party marks using “Aspire” in connection with various financial services. However, the TTAB narrowed its analysis to consider only nine marks specifically related to credit card services, dismissing the broader financial services marks as “essentially irrelevant.” The appellate panel found this approach legally flawed and emphasized that, if the board determined in its analysis of the second DuPont factor that the parties’ services are highly similar — even “partially legally identical” — then the board must maintain that same scope of similarity when analyzing other DuPont factors.
Link to First DuPont Factor – Mark Similarity: Collateral Damage First DuPont Factor – Mark Similarity: Collateral Damage
The Federal Circuit also vacated the TTAB’s analysis of the first DuPont factor (similarity of marks in appearance, sound, connotation, and commercial impression) because the reconsideration of third-party use evidence under the sixth factor could affect the determination of the mark’s commercial strength or weakness, which, in turn, influences the overall commercial impression analysis.
Link to Key Takeaways Key Takeaways
- Consistency Across Factors Is Non-Negotiable – While the TTAB has considerable discretion in weighing DuPont factors, that discretion must be exercised within a coherent analytical framework. Inconsistent application of similarity standards across factors may result in flawed likelihood-of-confusion analyses that cannot withstand appellate scrutiny.
- Interconnected Analysis – The DuPont factors do not exist in isolation. Changes to the analysis for one factor can have cascading effects on others, particularly when commercial strength and overall commercial impression are involved.
- Third-Party Use Evidence Deserves Broader Consideration – When analyzing market conditions under the sixth DuPont factor, practitioners should compile comprehensive third-party use evidence across the full spectrum of related goods and services, not just those that are most directly competitive. In crowded trademark fields, demonstrating that consumers are accustomed to distinguishing between similar marks can be crucial to avoiding likelihood-of-confusion findings.
Link to The Road Ahead The Road Ahead
While this remand doesn’t guarantee success for Apex Bank, the remand certainly gives it another chance that it did not have before the Federal Circuit took issue with the TTAB’s lack of rigorous, consistent analysis in its likelihood-of-confusion determinations. The TTAB will now need to reconsider whether CC Serve’s ASPIRE mark is entitled to broad protection or whether the crowded field of “Aspire” marks in financial services warrants a narrower scope of protection.