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From Intellectual Property Law Daily, November 26, 2018

SCHLAFLY mark properly found registrable for beer due to acquired distinctiveness

By Thomas Long, J.D.

A craft brewery’s mark SCHLAFLY met the requirements to be registered in connection with beer, according to the U.S. Court of Appeals for the Federal Circuit. The court affirmed the Trademark Trial and Appeal Board’s dismissal of two consolidated oppositions to the brewer’s application to register the mark, which had been filed by now-deceased conservative political activist Phyllis Schlafly and her son, orthopedic surgeon Dr. Bruce S. Schlafly. Substantial evidence supported the Board’s decision that the mark had acquired distinctiveness. The court rejected the opposers’ arguments that the Board failed to recognize that the SCHLAFLY mark was "primarily merely a surname" and that the Board improperly found that the mark had acquired secondary meaning although the applicant did not provide survey evidence. In addition, the court rejected the opposers’ claims that their First Amendment, Fifth Amendment, and Due Process rights were violated (Schlafly v. Saint Louis Brewery, LLC, November 26, 2018, Newman, P.).

The Saint Louis Brewery, LLC, filed an application to register SCHLAFLY in standard character form for beer, ale, lager, and similar goods. The application asserted that the mark had become distinctive in connection with the applicant’s goods through continuous exclusive use for at least five years. The applicant also owned two registrations for logo marks for beer, both of which featured the word "Schlafly." The brewery sold 60 types of beer, all using the applied-for mark, in 15 states and the District of Columbia, through 30 wholesalers, 14,000 retail establishments, and several national restaurant chains. From 2009 to 2014, the brewery sold more than 75 million units of SCHLAFLY beer. The brewery asserted that it had spent $1.1 million in advertising its brand over the last five years and had featured the SCHLAFLY mark in advertisements and promotions in several media and at events.

The opposers—Dr. Bruce Schlafly and the Phyllis Schlafly Revocable Trust—argued that Phyllis’s role in political and public discourse had caused the surname Schlafly to be primarily associated by members of the public with Phyllis Schlafly and her political positions and viewpoints. In addition, Dr. Schlafly asserted that he had used his name in connection with his medical practice in Sappington, Missouri, since 1986, and that allowing registration of the applied-for SCHLAFLY mark for beer would have a negative effect on the commercial value of his own name due to an association with drunk driving and other problems related to intoxication and alcohol consumption.

The Board ruled in favor of the brewery and entitled the SCHLAFLY mark to registration on the Principal Register. The Board based its decision on a finding that the mark had acquired distinctiveness under Section 2(f) of the Lanham Act. Due to the finding of acquired distinctiveness, the Board determined that it was unnecessary to decide whether the mark was primarily a surname. The Board rejected the opposers’ contention that the brewery was required to submit consumer surveys as evidence of secondary meaning, concluding that the brewery had made its case under Section 2(f) through evidence of the long continuous use of the mark, the geographic scope of use of the mark, the variety of products with the mark in commerce, the prominent placement of the mark on its products, the large sales volume of SCHLAFLY beer, marketing expenditures, and unsolicited media coverage and critical acclaim for the SCHLAFLY beer products.

Acquired distinctiveness—surname. Reviewing the Board’s factual findings for substantial evidence and its legal determinations de novo, the court agreed with the Board’s determination that the brewery had presented more than enough evidence to establish that the SCHLAFLY mark had acquired distinctiveness. The Trademark Rules of Practice specifically permitted the Board to consider the evidence it took into account in making its decision under Section 2(f), and the Board evaluated 15 different forms of evidence.

According to the opposers, SCHLAFLY was significant to the public primarily as the surname of Phyllis Schlafly, and they urged the court to adopt a new test that they called a "change in significance" test. This proposed test would provide that a surname cannot be registered without showing a change in significance to the public from a surname to an identifying mark for specified goods. However, the court noted, the Board had found that the SCHLAFLY mark had acquired secondary meaning for use with beer products. The Board did not err in refusing to decide whether the mark was primarily merely a surname because the Lanham Act provided that such a mark could be registered upon a showing of acquired distinctiveness resulting from the mark’s use in commerce in connection with the applicant’s goods or services. "No law or precedent suggests that surnames cannot be registered as trademarks if they have acquired distinctiveness in trademark use," the court said. Therefore, registration was not barred on the ground that the mark was primarily merely a surname.

Constitutional claims. The Federal Circuit rejected the opposers’ argument that the registration violated the First and Fifth Amendments of the Constitution. The opposers did not adequately explain how registration improperly impinged on their First Amendment rights, in the court’s view. The Fifth Amendment claim failed because trademark registration was not a taking for government use. Finally, the opposers’ due process argument was rejected because the trademark opposition process provided appropriate process of law.

This case is No. 17-1468.

Attorneys: Andrew Schlafly (Andrew Schlafly, Attorney at Law) for Bruce S. Schlafly. Mark R. Sowers (The Sowers Law Firm, LLC) for Saint Louis Brewery, LLC.

Companies: Saint Louis Brewery, LLC

MainStory: TopStory Trademark FedCirNews

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