Kelly Services, Inc. v. Creative Harbor, LLC
846 F.3d 857, 2017 FED App. 0016P, 121 U.S.P.Q. 2d (BNA) 1357 (2017)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
When an intent-to-use trademark applicant lacks a bona fide intent to use the mark in commerce on some, but not all, of the goods and services listed in the application, the application is not voided in its entirety; rather, a court should excise the goods and services for which the applicant lacks the requisite intent.
Facts:
- In early 2013, Kelly Services, Inc. began developing an employment-based application it decided to name 'WorkWire'.
- In September 2013, Christian Jurgensen developed an idea for a similar mobile application, also naming it 'WorkWire', and formed Creative Harbor, LLC in February 2014 to develop it.
- On February 19, 2014, Creative Harbor filed two 'intent-to-use' trademark applications for the 'WORKWIRE' mark, covering 36 different goods and services.
- In a sworn declaration accompanying the applications, Jurgensen affirmed that Creative Harbor had a bona fide intention to use the mark in commerce on all 36 listed items.
- Just hours after Creative Harbor filed its applications on February 19, 2014, Kelly Services' 'WorkWire' application became available for download on the Apple App Store.
- During a later deposition, Jurgensen admitted that some of the goods and services were included in the application for 'future exploration' or to 'keep the option open,' not because of a firm plan to use the mark on them.
- Jurgensen specifically testified that Creative Harbor did not intend to use the mark with a 'game' and did not know what 'employee relations information services' referred to, both of which were listed in the applications.
- On March 10, 2014, Creative Harbor sent Kelly Services a cease and desist letter, asserting its rights to the 'WORKWIRE' mark.
Procedural Posture:
- Kelly Services sued Creative Harbor in the U.S. District Court for the Eastern District of Michigan, seeking a declaratory judgment of its superior rights to the 'WORKWIRE' mark.
- Creative Harbor filed counterclaims, seeking a declaration that its applications gave it priority rights.
- Kelly Services also filed an opposition to Creative Harbor's applications with the Trademark Trial and Appeal Board (TTAB), which stayed its proceedings pending the outcome of the district court case.
- In the district court, both parties filed cross-motions for summary judgment on the issue of priority and the validity of Creative Harbor's applications.
- The district court granted summary judgment to Kelly Services, ruling that Creative Harbor lacked a bona fide intent to use the mark for some listed services and that this defect rendered both trademark applications void in their entirety.
- The district court entered a final judgment declaring Creative Harbor's applications invalid.
- Creative Harbor (appellant) appealed the judgment to the U.S. Court of Appeals for the Sixth Circuit, with Kelly Services as the appellee.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does an intent-to-use trademark application under § 1(b) of the Lanham Act become void in its entirety if the applicant lacks a bona fide intention to use the mark in commerce on some, but not all, of the goods and services listed in the application?
Opinions:
Majority - Clay, J.
No. An intent-to-use trademark application is not void in its entirety when the applicant lacks a bona fide intention to use the mark for some, but not all, of the listed goods and services, absent fraud or other egregious conduct. The Lanham Act requires objective evidence of a 'firm' intent to use the mark, not merely an intent to reserve a right in the mark for potential future exploration. Jurgensen's deposition testimony clearly established that Creative Harbor lacked this firm intent for several listed items, such as 'computer game software' and 'business consulting.' However, voiding the entire application is an overly harsh remedy. Citing TTAB precedent like Grand Canyon and Wet Seal, the court held that the proper remedy is to excise the unsupported goods and services from the application and allow the remainder to proceed. This approach avoids the perverse incentive for competitors to invalidate an entire application based on a minor overbreadth and better harmonizes the treatment of intent-to-use and use-based applications.
Concurring-in-part-and-dissenting-in-part - Batchelder, J.
Yes. The entire application should be voided because it is incumbent upon the applicant to amend its application to remove any items for which it lacks a bona fide intent. Creative Harbor failed to do so adequately, and therefore its entire application is invalid. The majority misinterprets TTAB precedent; cases like Grand Canyon and Syndicat involved applicants who proactively moved to amend their applications or agreed to delete the offending items. The rule from Spirits International, which the dissent argues is the correct one, is that if an opposer proves a lack of bona fide intent for even one item in a class, and the applicant fails to cure this defect by moving to amend, the opposition should be sustained against the class in its entirety. Because Creative Harbor did not take the necessary steps to cure the material overbreadth in its applications, the district court was correct to void them completely.
Analysis:
This decision clarifies the remedy for an overbroad intent-to-use (ITU) trademark application, rejecting an 'all-or-nothing' approach. It establishes for the Sixth Circuit that a lack of bona fide intent for some listed goods does not poison the entire application. This provides greater security to trademark applicants, who can now defend their applications without fearing total invalidation due to a few unsupported items. The ruling discourages tactical litigation by competitors seeking to exploit minor flaws to gain priority, instead focusing the inquiry on which specific goods and services the applicant genuinely intends to use the mark on.
