Enterprising corporations looking to join the “green rush” and cash in on the marijuana boom have found a loophole in the United States Patent and Trademark Office’s (USPTO) refusal to register trademarks for products that contain cannabis. By registering a trademark for ancillary products not related to marijuana, such as clothing or accessories, corporations can get a head-start in the budding cannabis industry by registering marks that they later hope to use in connection with actual cannabis products.
However, as the Trademark Trial and Appeal Board’s (“TTAB”) March 16, 2017 ruling in Margaritaville Enterprises, LLC v. Bevis (http://ttabvue.uspto.gov/ttabvue/ttabvue-91219403-OPP-44.pdf) demonstrates, applicants in the cannabis space, like all other applicants, should still be wary of the other potential potholes along the way.
Colorado resident Rachel Bevis, presumably seeking to stake her claim in the burgeoning cannabis industry, applied to register the mark “Marijuanaville” in standard characters on the Principal Register for “T-Shirts, Hats, Sweat Shirts, sweat pants, Jackets, Socks” in International Class 25 and “Drive-through retail store services featuring coffee and related goods; Retail apparel stores; Retail clothing stores” in International Class 35.
Margaritaville Enterprises, LLC, the successor in interest to Jimmy Buffet, the singer of the classic “Margaritaville,” opposed the registration on the ground of “likelihood of confusion” under Section 2(d) of the Trademark Act, based on its previously used and registered “Margaritaville” marks in International Class 25 for clothing, and International Class 42 for retail clothing, nightclub services, gift services, souvenir store services, and mail order services in connection with clothing, gifts, and souvenirs.
In support of its opposition, Margaritaville submitted the declaration of Buffet, which explains the genesis of the “Margaritaville” clothing brand following the immense success of the hit song of the same name, released on Buffet’s 1977 album “Changes in Latitudes, Changes in Attitudes.” Since 1977, Buffet has performed the song at every one of his concerts. According to Buffet, the title of the song refers to a state of mind inspired by margaritas, which he closely associates with beaches, tropics, leisure activities, islands, and escapism. Based on the song’s popularity, Buffet opened “Margaritaville”-branded retail clothing stores in 1985, which have operated continuously and successfully ever since, offering clothing inspired by this tropical paradise state of mind.
In its analysis of the likelihood of confusion between the two marks, the Board referenced the thirteen factors set forth in In re E. I. du Pont de Nemours & Co., 476 F.2d 1357, 567 (C.C.P.A. 1973) (“du Pont”), largely focusing on the following elements: (1) the fame of the “Margaritaville” mark; (2) the similarity of the goods; and (3) the similarity of the marks.
In determining that the “Margaritaville” mark is “famous” for “clothing,” the Board examined Margaritaville’s U.S. revenues from merchandise sold in its stores from 2008-2013 (which it found to be “impressive”), unsolicited media attention received by the mark, as well as evidence that the mark has been the subject of widespread media and popular culture exposure with regard to clothing − indicating an association between the trademark “Margaritaville” and a particular style of clothing.
Comparing the goods and trade channels, the Board noted that the relevant applications of the marks included identical goods: souvenir clothing. While Bevis claimed that she only intended to market and offer her goods and services in locations that support the marijuana industry, she failed to set forth such limitations in her application, and thus, the Board was not persuaded that the trade channels between the marks differed. One takeaway from the Board’s decision is that it will not infer that cannabis-related goods are inherently distinguishable from other goods based on their potentially narrower audience.
The Board dedicated almost a third of its decision to analyzing the similarity of the marks in their entireties. While Bevis argued that the marks are “completely different” as the prefix “margarita” denotes a mixed cocktail whereas “marijuana” constitutes a plant, Margaritaville argued that the marks are similar in sound, appearance, connotation, and commercial impression. In determining that consumers would likely think goods bearing the “Marijuanaville” mark were “extension[s] of [Buffett]’s lifestyle brand,” the Board considered evidence submitted by Margaritaville’s expert lexicographer, and concluded that the two terms are linguistically similar (both starting with “mar” and ending with “-ville,” both having the same number of letters and syllables), and that both marks give a similar commercial impression of being “a chemically induced mental paradise.”
Overall, the Board focused heavily on the fame of the “Margaritaville” mark for trademark purposes, and the decision reads like a love-letter to Buffet’s iconic brand. Given its emphasis on the mark’s popularity, it will be interesting to see how the Board handles an opposition filed in connection with marijuana-related goods or services that may conflict with the trademark of a lesser-known brand. In doing so, the Board will likely have to weigh other du Pont factors more heavily, such as the conditions under which the goods and services are likely to be purchased (e.g., whether on impulse or after careful consideration), the similarity of the goods, whether the goods travel through the same trade channels and can be purchased by the same classes of consumers, as well as the extent of any actual confusion between the two marks. Until then, expect to see more creative ways industrious cannabis trailblazers try to make their mark in the billion-dollar marijuana industry through brand building and recognition.