Trademark case
Trademark case
Nationstar Mortgage LLC v. Ahmad, Opp. No. 91177036, — U.S.P.Q.2d — (T.T.A.B. 2014)
- INTRODUCTION
In a precedential decision released September 30, 2014, the Trademark Trial and Appeal Board (“TTAB” or the “Board”) sustained a fraud claim for the first time since 2009.
Fraud in procuring or maintaining a trademark registration occurs when an applicant or registrant makes false, material representations of fact in connection with a trademark application or registration with the intent to deceive the U.S. Patent and Trademark Office (“USPTO”). Before the 2009 decision of the U.S. Court of Appeals for the Federal Circuit (“CAFC”) in In re Bose Corporation, 91 U.S.P.Q.2d 1938 (Fed. Cir. 2009), parties could successfully object to applications or registrations by showing that the applicant or registrant made material representations of fact to the USPTO that it knew or should have known to be false. In In re Bose, the CAFC rejected the “should have known” standard, holding that such standard “erroneously lowered the fraud standard to a simple negligence standard.” 91 U.S.P.Q.2d at 1940. Following the CAFC’s 2009 decision, many parties have tried to prove fraud but have floundered in establishing “knowing intent to deceive,” direct evidence of which is rarely available.
- DESCRIPTION
In the most recent precedential decision to rule on a fraud claim, applicant Mujahid Ahmad, without the help of an attorney, prepared and filed a use-based application to register the mark NATIONSTAR for “real estate brokerage; rental of real estate; real estate management services, namely, management of commercial and residential properties; real estate investment; residential and commercial property and insurance brokerage; mortgage brokerage; and business finance procurement services.” Nation star Mortgage LLC opposed, alleging fraud on the basis that Ahmad had not used the NATIONSTAR mark for any of the recited services before the filing date of the application and had submitted a fabricated specimen of use. In sustaining the opposition, the TTAB agreed that Ahmed’s averments about his use of the NATIONSTAR mark for the recited services at the time he filed the application were fraudulent. Having ruled in Nation star’s favor on the “principal” fraud claim, the Board declined to rule on the “alternative” fraud claim regarding the allegedly fabricated specimens.
- CONCLUSION
The TTAB had no problem with the materiality element of Nation star’s fraud claim, holding that Ahmad’s statements regarding use of the NATIONSTAR mark for the recited services as of the application filing date were material to the USPTO’s approval of the application for publication, since “if it had been disclosed to the examining attorney that the mark was not in use for the identified services . . . , registration would have been refused.”
The TTAB also had little trouble finding that Ahmad’s averments regarding use were false. The Board found that Ahmad’s testimony was entirely “lacking in conviction and credibility.” For example, although Ahmad was the owner and president of Nation Star Mortgage, Inc., he claimed not to know whether the company had any earnings. He also professed not to know which advertising materials he had created himself and which had been created by outside vendors, or even who those outside vendors were. The Board emphasized that Ahmad was not a licensed mortgage broker, insurance broker, or real estate broker at or before the time he filed his trademark application, and thus could not have legally held himself out as providing those services, which were among those recited in the application. Ultimately, the Board refused to credit either Ahmad’s testimony or the documents on which he relied, and concluded that there was no evidence that Ahmad had been using the NATIONSTAR mark before the application date.
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