The COACH Mark Is Famous, But Not Famous Enough to Support a Dilution Claim

Although acknowledging that the COACH mark for handbags and other luxury goods was famous enough for that fame to be a strong factor in a likelihood of confusion analysis, the U.S. Court of Appeals for the Federal Circuit has concluded that there was insufficient proof that the mark was a “household name” that was famous enough to support a claim of dilution against a third party's COACH-branded educational materials. Coach Services, Inc. v. Triumph Learning LLC, __ F.3d __ (Fed. Cir. 2012).

Factual History

Triumph Learning LLC (“Triumph”) is a publisher of books and software to assist teachers and students to prepare for state-administered standardized tests. Triumph claims to have adopted the trademark COACH for its educational materials in 1986, and to have expanded its marketing after Congress passed the No Child Left Behind Act in 2001 by developing a cartoon mascot resembling a sports coach and adopting the slogan “America's best for student success.”

In December 2004, Triumph filed federal applications for three trademarks: 1) the block letter word COACH, 2) a stylized version of the word COACH, and 3) the COACH trademark combined with the cartoon mascot and the slogan. The applications all covered the software test preparation products and related audio and video tapes, as well as related print materials such as textbooks, workbooks, teacher guides, posters and flashcards. Those applications were published for opposition in the Official Gazette of the U.S. Patent and Trademark Office (“PTO”) in September 2005. Coach Services, Inc. (“Coach”), the well-known seller of luxury handbags, wallets, luggage, clothing and other products, opposed Triumph's applications in the Trademark Trial and Appeal Board (“TTAB” or “Board”), contending that there was a likelihood of confusion, that its mark was being diluted by Triumph's use of COACH for educational materials and that Triumph's use of COACH was merely descriptive and, therefore, could not be registered as a trademark.

In the oppositions, Coach claimed that it has been using the COACH mark since 1961, that it owned 16 incontestable trademark registrations, that its sales exceeded $10 billion during 2000-2008, that in 2008 its sales were $3.5 billion and that it spent around $30-60 million a year on advertising, which included national fashion magazines such as Elle, Vogue, Mademoiselle, and Vanity Fair. Coach also relied on its joint marketing efforts with other popular brands such as LEXUS and CANON, unsolicited media attention it received from the fashion press, a 2007 internal market study showing that 96% of the public between the ages of 18-24 recognized the COACH brand, and the steps it had taken to stop past infringers. Coach was not in the education or test-preparation business, was not in competition with Triumph, and had no evidence of actual confusion from Triumph's use of its COACH mark for educational materials.

In 2010, the TTAB dismissed the oppositions, finding that there was no likelihood of confusion between Coach's and Triumph's marks, and there was no likelihood of dilution of Coach's marks for lifestyle goods by Triumph's use of COACH for educational materials. The Board found that the COACH mark was famous for the purpose of determining likelihood of confusion, but concluded that Coach had not provided enough evidence of fame for dilution purposes. The Board also held that Triumph's marks, although merely descriptive, had acquired distinctiveness and were entitled to registration.

The Federal Circuit's Decision

On appeal to the U.S. Court of Appeals for the Federal Circuit, Coach argued that the TTAB did not properly apply the likelihood of confusion factors, ignored substantial evidence that the COACH mark was famous for dilution purposes, and wrongly found that Triumph's mark had acquired distinctiveness. The Federal Circuit held that the TTAB had properly determined that there was no likelihood of confusion because of the “vast differences” in the parties' goods, channels of trade and commercial impressions made on consumers, and that there was no likelihood of dilution because Coach had failed to meet the stringent standards to prove that its mark was famous. However, because the TTAB made mistakes in evaluating Triumph's evidence of acquired distinctiveness, the Federal Circuit sent the case back to the Board for further proceedings on just that issue.

The Federal Circuit spent six pages of its 44-page opinion discussing the mistakes that Coach made in trying to put its evidence of fame into the record in the opposition proceedings. The TTAB had refused to consider Coach's annual reports from 2000-2008 because they were not properly authenticated under the Board's rules, which permit corporate annual reports to be introduced into evidence without authentication only if they were publicly available on the Internet and identified with the date of publication or the date that the report was accessed and printed, along with the source (for example, the URL). Publicly available documents printed from the Internet that display a date and source are presumed to be true and genuine in TTAB proceedings. However, corporate annual reports available only in paper form are not entitled to a presumption of genuineness because they are not considered to be a document in “general circulation.” Although Coach's annual reports were available online in electronic versions identical to its versions originally published on paper, the paper versions were not admissible as evidence because they had not been properly authenticated by a witness. The Federal Circuit observed that the Board's rules about admission of evidence “can be readily learned and easily satisfied,” although they are specific and do not mirror the Federal Rules of Evidence.

Likelihood of Confusion

On the issue of likelihood of confusion, the Federal Circuit noted that the TTAB was entitled to focus on just those factors that are significant to the marks being considered. The Board's finding that the marks “have different meanings and engender different commercial impressions,” and that the goods involved “are not similar or related in any way,” was sufficient to support its finding that there was no likelihood of confusion. The Board was not required to find a likelihood of confusion based solely on the fame of Coach's mark, as fame alone is insufficient to establish that confusion is likely. Fame deserves “its full measure of weight,” but cannot overwhelm the other factors.

Although the TTAB found that Coach's mark was famous for purposes of the likelihood of confusion analysis, the Federal Circuit agreed that the other factors, such as the different meanings and commercial impressions, outweighed the factor of fame. When applied to educational materials, “COACH” brings to mind someone who instructs students. As applied to Coach's luxury goods, “COACH” brings to mind traveling by carriage. Moreover, the Federal Circuit agreed there was no evidence that the parties' goods were related, and there was sufficient evidence that the parties' goods are sold and marketed to different consumers in different channels of trade. Although there was some potential for overlap in customers, no evidence suggested that a purchaser of test preparation materials who also purchases a luxury handbag would think that the goods came from the same source or had the same sponsorship.

Likelihood of Dilution

As to the issue of likelihood of dilution, the Federal Circuit concluded that the TTAB was correct in finding that Triumph's COACH marks would not blur the distinctiveness of Coach's mark. A mark is famous for dilution purposes when it “is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark's owner.” 15 U.S.C. ' 1125(c)(2)(A). That definition eliminates the possibility of “niche fame” by requiring a court to consider: 1) the duration, extent, and geographic reach of advertising and publicity of the mark, whether advertised or publicized by the owner or third parties; 2) the amount, volume, and geographic extent of sales of goods or services offered under the mark; 3) the extent of actual recognition of the mark; and 4) whether the mark was registered on the Principal Register.

The Federal Circuit noted that fame for dilution requires a stronger showing than fame for likelihood of confusion. A mark can be sufficiently renowned to be famous for purposes of likelihood of confusion without being famous enough for dilution. Thus, observed the Federal Circuit, dilution fame is difficult to prove, particularly where the mark is a common English word that has different meanings in different contexts. The owner of the mark must demonstrate that the owner's use of the mark has “eclipsed” the common or proper noun uses of the term when the general public encounters the term, in fact, that the famous mark has become a “household name.” Coach failed to provide enough evidence to carry that burden. It is not enough to show that a mark is a top-selling brand without evidence of how many persons are purchasers. It is similarly insufficient to rely on the mere existence of federally registered trademarks because the ownership of registrations, among millions on the federal registry, is not conclusive proof of fame.

Coach's evidence of media attention, observed the Federal Circuit, although showing that the mark had achieved a “substantial degree of recognition,” fell short of showing “widespread recognition” of its mark by the general population. Many of the articles to which Coach referred were published after Triumph filed its applications, and Coach was required to show that its mark was famous prior to Triumph's filing date. In addition, many of the references mention Coach's brand among other brands. Coach failed to demonstrate the success of its joint marketing efforts or their effect in promoting its mark, and its 2007 study of brand awareness, conducted after Triumph's applications were filed, was limited to the age 18-24 female niche segment of the public, not men or women at large.

Lastly, the Federal Circuit concluded that substantial evidence supported the Board's finding that “COACH” was merely descriptive in connection with educational materials used to prepare students for standardized tests. However, the Federal Circuit disagreed that Triumph had provided enough evidence that its mark had acquired distinctiveness in the minds of the public, because the Board disregarded Coach's evidence of 43 book and software titles by third parties showing use of “Coach” for coaching materials and gave weight to materials Triumph placed in evidence without appropriate authentication. For that reason, the Federal Circuit sent the case back to the TTAB for further consideration of whether Triumph had supported its acquired distinctiveness claim.

It is likely that Coach could prove widespread recognition of the COACH brand among most women, even those that could not afford to purchase COACH products. It could be more difficult to demonstrate the “household name” level of recognition of the brand among men. The Federal Circuit paused in its analysis to observe that the burden to show fame in the dilution context is high but “not insurmountable,” and gave Coach (and other well-known brand owners) hope that fame could be established in some other situation with stronger evidence.

Judith L. Grubner is a member of this newsletter's Board of Editors and a partner in the IP Practice Group of Arnstein & Lehr LLP. She can be reached at [email protected].

Although acknowledging that the COACH mark for handbags and other luxury goods was famous enough for that fame to be a strong factor in a likelihood of confusion analysis, the U.S. Court of Appeals for the Federal Circuit has concluded that there was insufficient proof that the mark was a “household name” that was famous enough to support a claim of dilution against a third party's COACH-branded educational materials. Coach Services, Inc. v. Triumph Learning LLC , __ F.3d __ (Fed. Cir. 2012).

Factual History

Triumph Learning LLC (“Triumph”) is a publisher of books and software to assist teachers and students to prepare for state-administered standardized tests. Triumph claims to have adopted the trademark COACH for its educational materials in 1986, and to have expanded its marketing after Congress passed the No Child Left Behind Act in 2001 by developing a cartoon mascot resembling a sports coach and adopting the slogan “America's best for student success.”

In December 2004, Triumph filed federal applications for three trademarks: 1) the block letter word COACH, 2) a stylized version of the word COACH, and 3) the COACH trademark combined with the cartoon mascot and the slogan. The applications all covered the software test preparation products and related audio and video tapes, as well as related print materials such as textbooks, workbooks, teacher guides, posters and flashcards. Those applications were published for opposition in the Official Gazette of the U.S. Patent and Trademark Office (“PTO”) in September 2005. Coach Services, Inc. (“Coach”), the well-known seller of luxury handbags, wallets, luggage, clothing and other products, opposed Triumph's applications in the Trademark Trial and Appeal Board (“TTAB” or “Board”), contending that there was a likelihood of confusion, that its mark was being diluted by Triumph's use of COACH for educational materials and that Triumph's use of COACH was merely descriptive and, therefore, could not be registered as a trademark.

In the oppositions, Coach claimed that it has been using the COACH mark since 1961, that it owned 16 incontestable trademark registrations, that its sales exceeded $10 billion during 2000-2008, that in 2008 its sales were $3.5 billion and that it spent around $30-60 million a year on advertising, which included national fashion magazines such as Elle, Vogue, Mademoiselle, and Vanity Fair. Coach also relied on its joint marketing efforts with other popular brands such as LEXUS and CANON, unsolicited media attention it received from the fashion press, a 2007 internal market study showing that 96% of the public between the ages of 18-24 recognized the COACH brand, and the steps it had taken to stop past infringers. Coach was not in the education or test-preparation business, was not in competition with Triumph, and had no evidence of actual confusion from Triumph's use of its COACH mark for educational materials.

In 2010, the TTAB dismissed the oppositions, finding that there was no likelihood of confusion between Coach's and Triumph's marks, and there was no likelihood of dilution of Coach's marks for lifestyle goods by Triumph's use of COACH for educational materials. The Board found that the COACH mark was famous for the purpose of determining likelihood of confusion, but concluded that Coach had not provided enough evidence of fame for dilution purposes. The Board also held that Triumph's marks, although merely descriptive, had acquired distinctiveness and were entitled to registration.

The Federal Circuit's Decision

On appeal to the U.S. Court of Appeals for the Federal Circuit, Coach argued that the TTAB did not properly apply the likelihood of confusion factors, ignored substantial evidence that the COACH mark was famous for dilution purposes, and wrongly found that Triumph's mark had acquired distinctiveness. The Federal Circuit held that the TTAB had properly determined that there was no likelihood of confusion because of the “vast differences” in the parties' goods, channels of trade and commercial impressions made on consumers, and that there was no likelihood of dilution because Coach had failed to meet the stringent standards to prove that its mark was famous. However, because the TTAB made mistakes in evaluating Triumph's evidence of acquired distinctiveness, the Federal Circuit sent the case back to the Board for further proceedings on just that issue.

The Federal Circuit spent six pages of its 44-page opinion discussing the mistakes that Coach made in trying to put its evidence of fame into the record in the opposition proceedings. The TTAB had refused to consider Coach's annual reports from 2000-2008 because they were not properly authenticated under the Board's rules, which permit corporate annual reports to be introduced into evidence without authentication only if they were publicly available on the Internet and identified with the date of publication or the date that the report was accessed and printed, along with the source (for example, the URL). Publicly available documents printed from the Internet that display a date and source are presumed to be true and genuine in TTAB proceedings. However, corporate annual reports available only in paper form are not entitled to a presumption of genuineness because they are not considered to be a document in “general circulation.” Although Coach's annual reports were available online in electronic versions identical to its versions originally published on paper, the paper versions were not admissible as evidence because they had not been properly authenticated by a witness. The Federal Circuit observed that the Board's rules about admission of evidence “can be readily learned and easily satisfied,” although they are specific and do not mirror the Federal Rules of Evidence.

Likelihood of Confusion

On the issue of likelihood of confusion, the Federal Circuit noted that the TTAB was entitled to focus on just those factors that are significant to the marks being considered. The Board's finding that the marks “have different meanings and engender different commercial impressions,” and that the goods involved “are not similar or related in any way,” was sufficient to support its finding that there was no likelihood of confusion. The Board was not required to find a likelihood of confusion based solely on the fame of Coach's mark, as fame alone is insufficient to establish that confusion is likely. Fame deserves “its full measure of weight,” but cannot overwhelm the other factors.

Although the TTAB found that Coach's mark was famous for purposes of the likelihood of confusion analysis, the Federal Circuit agreed that the other factors, such as the different meanings and commercial impressions, outweighed the factor of fame. When applied to educational materials, “COACH” brings to mind someone who instructs students. As applied to Coach's luxury goods, “COACH” brings to mind traveling by carriage. Moreover, the Federal Circuit agreed there was no evidence that the parties' goods were related, and there was sufficient evidence that the parties' goods are sold and marketed to different consumers in different channels of trade. Although there was some potential for overlap in customers, no evidence suggested that a purchaser of test preparation materials who also purchases a luxury handbag would think that the goods came from the same source or had the same sponsorship.

Likelihood of Dilution

As to the issue of likelihood of dilution, the Federal Circuit concluded that the TTAB was correct in finding that Triumph's COACH marks would not blur the distinctiveness of Coach's mark. A mark is famous for dilution purposes when it “is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark's owner.” 15 U.S.C. ' 1125(c)(2)(A). That definition eliminates the possibility of “niche fame” by requiring a court to consider: 1) the duration, extent, and geographic reach of advertising and publicity of the mark, whether advertised or publicized by the owner or third parties; 2) the amount, volume, and geographic extent of sales of goods or services offered under the mark; 3) the extent of actual recognition of the mark; and 4) whether the mark was registered on the Principal Register.

The Federal Circuit noted that fame for dilution requires a stronger showing than fame for likelihood of confusion. A mark can be sufficiently renowned to be famous for purposes of likelihood of confusion without being famous enough for dilution. Thus, observed the Federal Circuit, dilution fame is difficult to prove, particularly where the mark is a common English word that has different meanings in different contexts. The owner of the mark must demonstrate that the owner's use of the mark has “eclipsed” the common or proper noun uses of the term when the general public encounters the term, in fact, that the famous mark has become a “household name.” Coach failed to provide enough evidence to carry that burden. It is not enough to show that a mark is a top-selling brand without evidence of how many persons are purchasers. It is similarly insufficient to rely on the mere existence of federally registered trademarks because the ownership of registrations, among millions on the federal registry, is not conclusive proof of fame.

Coach's evidence of media attention, observed the Federal Circuit, although showing that the mark had achieved a “substantial degree of recognition,” fell short of showing “widespread recognition” of its mark by the general population. Many of the articles to which Coach referred were published after Triumph filed its applications, and Coach was required to show that its mark was famous prior to Triumph's filing date. In addition, many of the references mention Coach's brand among other brands. Coach failed to demonstrate the success of its joint marketing efforts or their effect in promoting its mark, and its 2007 study of brand awareness, conducted after Triumph's applications were filed, was limited to the age 18-24 female niche segment of the public, not men or women at large.

Lastly, the Federal Circuit concluded that substantial evidence supported the Board's finding that “COACH” was merely descriptive in connection with educational materials used to prepare students for standardized tests. However, the Federal Circuit disagreed that Triumph had provided enough evidence that its mark had acquired distinctiveness in the minds of the public, because the Board disregarded Coach's evidence of 43 book and software titles by third parties showing use of “Coach” for coaching materials and gave weight to materials Triumph placed in evidence without appropriate authentication. For that reason, the Federal Circuit sent the case back to the TTAB for further consideration of whether Triumph had supported its acquired distinctiveness claim.

It is likely that Coach could prove widespread recognition of the COACH brand among most women, even those that could not afford to purchase COACH products. It could be more difficult to demonstrate the “household name” level of recognition of the brand among men. The Federal Circuit paused in its analysis to observe that the burden to show fame in the dilution context is high but “not insurmountable,” and gave Coach (and other well-known brand owners) hope that fame could be established in some other situation with stronger evidence.

Judith L. Grubner is a member of this newsletter's Board of Editors and a partner in the IP Practice Group of Arnstein & Lehr LLP. She can be reached at [email protected].