On August 31, 2009, the United States Court of Appeals for the Federal Circuit (“CAFC”) handed down its decision in In re Bose, 91 USPQ2d 1938 (Fed. Cir. 2009). The collective sigh of relief taken by trademark attorneys across the country created enough wind energy to power a mid-size city. The CAFC had overruled the Draconian rule of Medinol Ltd. v. NeuroVasx, Inc., 67 U.S.P.Q.2d 1205 (TTAB 2003), which previously applied a “knew or should have known” standard to allegations of fraud on the Trademark Office. In its place, In re Bose had re-instated an “intent” element for proving fraud against the Trademark Office, aligning the offense with common law concepts of fraud.
What does the In re Bose decision mean for trademark owners and intellectual property practitioners going forward? Will a trademark registration be voided for fraud on the Trademark Office ever again? Will the number of fraud claims brought before the TTAB plummet? While we don’t have answers to all of the questions raised by In re Bose, we can glean several pieces of information from the TTAB’s handling of fraud claims post-Bose:
1. In pleading fraud, a claimant must now include an allegation that the false statement in question was made with intent to deceive the Trademark Office. Moreover, claimants must include specific facts supporting the intentional nature of the false statement and cannot plead the facts on mere “information and belief.” Asian Western Classics BV v. Slekow, 92 USPQ 2d 1478 (TTAB 2009).
2. While In re Bose raised the burden of proof for proving fraud against the Trademark Office, it did not change the penalty, when proven. “A finding of fraud with respect to a particular class of goods or services renders any resulting registration void as to that class.” Meckatzer Löwenbräu Benedikt Weiß KG v. White Gold, LLC, 95 USPQ2d 1185 (TTAB 2010).
3. While In re Bose shut the door on the negligence standard of Medinol, it may have cracked a window to a recklessness standard that would serve as a middle ground. In footnote 2 of Bose, the CAFC wrote: “The PTO argues that under Torres, making a submission to the PTO with reckless disregard of its truth or falsity satisfies the intent to deceive requirement. We need not resolve this issue here.” The TTAB confirmed the possibility of a recklessness standard shortly after In re Bose, stating that it is undecided “whether a submission to the PTO with reckless disregard of its truth or falsity would satisfy the intent to deceive requirement.” DaimlerChrysler Corp. v. American Motors Corp., 94 USPQ2d 1086 (2010).
Of course, trademark owners and attorneys alike should always make every effort to ensure the truth of information included in any documentation provided to the Trademark Office. Even if a registration is not voided by a claim of fraud, mistakes in the application and renewal process can lead to goods or services being deleted from a registration and to unnecessary expenses and delay in enforcing the registration against third-parties. What In re Bose tells us, however, is that reasonable efforts to be truthful on the part of trademark owners and attorneys will protect registrations against the harsh penalties that accompany a finding of fraud on the Trademark Office.