What in the world are “phantom” trademarks? This was a new topic for us, although we had written about so-called “submarine” trademarks several years ago.
Phantom vs. Submarine Trademarks: What’s the Difference?
Filing a submarine trademark is a strategy aimed at maintaining a veil of secrecy over a company’s marketing plans by filing in a foreign country which doesn’t publish trademark applications or maintain an online application database. Filing submarine trademark applications is a legally permissible strategy even though, because of their furtive nature, it denies the public constructive notice of a trademark filing (which is the point) until it is refiled in the United States.
What Is a Phantom Trademark Application?
On the other hand, filing “phantom” trademark applications, which similarly denies the public constructive notice of the filing, is not legally permissible. A phantom trademark is one that contains a blank space reserved for a word or image that may change depending upon how or where the trademark is placed.
The IFF Case: Phantom Trademarks in Court
In 1999, in a case of first impression, the Court of Appeals for the Federal Circuit in In Re International Flavors & Fragrances Inc. reviewed the problem of phantom trademark applications. The Appellant, International Flavors & Fragrances Inc. (“IFF”), wished to register three trademarks: LIVING XXXX FLAVORS, LIVING XXXX FLAVOR, and LIVING XXXX, which identified essential oils used in the manufacture of flavored foodstuffs and tobacco products. The XXXX part of the marks was reserved for identifying a “specific herb, fruit, plant or vegetable.” In support of its applications, IFF submitted samples that demonstrated use of “LIVING STRAWBERRY FLAVOR,” “LIVING CILANTRO FLAVOR, LIVING FLOWERS and other trademarks.” Of course, the fruit, herb or flower designation might change depending upon the product.
Why the Trademark Office Rejected the Application
The Trademark Examiner rejected IFF’s trademark applications on grounds that they were “phantom” trademarks. The Trademark Trial and Appeal Board (the “Board”) affirmed. The Board wrote that IFF wished to own three registrations that identified an unknown number of trademarks, and while the USPTO had no policy at the time regarding registration of phantom trademarks, “to the extent that any mark sought to be registered has an omitted word or other element, conducting a complete and thorough search is extremely difficult….” The inability to determine the scope of the trademark was sufficient reason to reject the appeal from the Trademark Examiner’s decision.
IFF appealed to the Federal Circuit, where it argued that because there was no statutory or regulatory basis for granting or denying “phantom” marks, the Board’s decision denied it equal protection under laws provided by the Fifth Amendment. In response, the Commissioner of Patents and Trademarks argued that a trademark application may contain only a single trademark and that to permit phantom elements in a registration would deny the public adequate notice of all marks encompassed by the registration.
The Federal Circuit’s Final Decision
The Court of Appeals sided with the Commissioner. After reviewing the legal basis and policies underpinning U.S. trademark laws, the Court emphasized that “[r]egistration serves as constructive notice to the public of the registrant’s ownership of the mark, see 15 U.S.C. 1072, and thus prevents another user of the mark from claiming innocent misappropriation as a trademark infringement defense.”
But to make this constructive notice meaningful, according to the Court, the registered trademark must be sufficiently recognizable as the mark that is used in commerce so as to enable someone searching the USPTO registry to locate the mark. “Phantom” trademarks, by definition, are missing elements that may “encompass too many combinations and permutations to make a thorough and effective search possible.” Hence, the registration of such marks fails to provide proper notice and defeats “one of the vital purposes of federal trademark registration.” As to IFF’s assertion that it was denied equal protection, the Court wrote that it “was provided a full opportunity to prosecute its applications and to appeal the examining attorney’s final rejections to the Board.”
Lessons for Today’s Trademark Applicants
What are the implications of this 1999 phantom trademark case for trademark applicants today? If you’re filing a trademark application in the United States, the mark must reflect the mark as it is being used in commerce. Doing otherwise prevents the public from finding a record of the trademark for avoiding potential infringements. Of course, if you can convert your phantom trademark to a submarine trademark, you might have better luck.
Adam G. Garson, Esq.
*Originally posted on my PA Trademark Lawyer website.