Direct Marketing Consultants, LLCv.Wise-Buys, Inc.

Trademark Trial and Appeal Board

Jul 13, 2009

No. 92049014 (T.T.A.B. Jul. 13, 2009)

Mailed: July 13, 2009

UNITED STATES PATENT AND TRADEMARK OFFICE
_____

Trademark Trial and Appeal Board
______

Direct Marketing Consultants, LLC
v.
Wise-Buys, Inc.
_____

Cancellation No. 92049014

_____

William R. Berggren of Berggren Law Offices, LLC for Direct
Marketing Consultants, LLC.

Alexander Volchegursky of Lvovich & Volchegursky, LLP for
Wise-Buys, Inc.
______

Before Grendel, Kuhlke and Wellington, Administrative
Trademark Judges.

Opinion by Kuhlke, Administrative Trademark Judge:

Direct Marketing Consultants, LLC has petitioned to
cancel Registration No. 2814955 owned by Wise-Buys, Inc. for
the mark shown below for “direct mail advertising using
envelopes and flyers with discount coupons distributed by
mail and other means to businesses and residential
consumers” in International Class 35, filed on August 26,
THIS OPINION IS NOT A
PRECEDENT OF THE TTAB
Cancellation No. 92049014
2
2002 and issued on February 17, 2004, alleging July 1, 1997
as the date of first use and first use in commerce.

As grounds for cancellation petitioner alleges that
respondent’s use of its mark “does not satisfy the
requirement of the USPTO to have ‘use in commerce’ before
the grant of a Registration Number. Accordingly, Petitioner
contends that Registrant/Respondent is not entitled to the
national rights afforded by registration for reason of fraud
on the USPTO.” Amended Petition ¶ 5.1
Respondent, in its answer, denies the salient
allegations in the amended petition for cancellation and
asserts the affirmative defenses of laches, estoppel,
waiver, acquiescence and unclean hands. Inasmuch as
respondent has not addressed these defenses in its brief, we
consider them to have been waived.
Accelerated Case Resolution (ACR)/The Record

1 The original petition, filed on March 13, 2008, alleged the
ground of priority and likelihood of confusion. On August 13,
2008, the Board granted as conceded, petitioner’s motion to amend
the petition, which deleted the claim of priority and likelihood
of confusion and added what was ultimately clarified to be a
claim of fraud based on no bona fide use in commerce. See Board
Orders dated October 13, 2008 and January 22, 2009.
Cancellation No. 92049014
3
Pursuant to agreement, the parties tried this case by
using the Board’s ACR procedure.2 Given the parties’
agreement familiarity with this procedure is presumed. We
note generally that, pursuant to the parties’ agreement, the
evidence submitted in connection with the briefs has been
treated as the final record and briefs for this case.
By operation of Trademark Rule 2.122, 37 C.F.R. §2.122,
the record in this case consists of the pleadings and the
file of the involved registration. In addition, the record
includes the following declarations with exhibits
accompanying petitioner’s and respondent’s ACR briefs: 1)
Declarations of David Whetstone, president of Qponz Inc.,
petitioner’s predecessor-in-interest (petitioner’s main
brief and reply brief); 2) Declarations of Joe Chesmer,
petitioner’s president (petitioner’s main brief and reply
brief); 3) Declaration of Steve Marcus, respondent’s vice-
president and owner (respondent’s brief); and 4) Declaration
of Bill Hoverson, president of Independent Co-Op Mail
Dealers Association (petitioner’s reply brief).
The Parties
Petitioner is a Minnesota company and its service
consists of “providing a cooperative direct mail coupon
booklet containing advertisements of local advertisers by

2 Additional information on this procedure is available on the
United States Patent and Trademark Office (USPTO) website at
www.uspto.gov/web/offices/com/sol/notices/acrognoticerule.pdf.
Cancellation No. 92049014
4
saturation mail to all addresses within a specific
geographical area.” Whetstone Declaration. See also
Chesmer Declaration. Petitioner mails its “booklets with
discount coupons ... to business and residential consumers
in regions of Minnesota.” Br. p. 7. See generally,
Whetstone and Chesmer Declarations. Petitioner has been
using the mark WI$E-BUY$ in connection with these services
since at least August 2002. Id.
Respondent, a California corporation, provides “direct
mail advertising services using envelopes and flyers with
discount coupons distributed by mail and other means to
businesses and residential consumers.” Marcus Declaration.
See also Answer to Amended Petition ¶ 1. Respondent has
been using its WISE BUYS and design mark since at least
1997. Id.
Standing
Petitioner has submitted evidence of its use of the
mark WI$E-BUY$ in connection with direct mail advertising
services and as such has shown a real interest in the
outcome of this proceeding. Ritchie v. Simpson, 170 F.3d
1092, 50 USPQ2d 1023 (Fed. Cir. 1999); Cunningham v. Laser
Golf Corp., 222 F.3d 943, 55 USPQ2d 1842 (Fed. Cir. 2000).
Fraud
Fraud in obtaining or maintaining a trademark
registration “occurs when an applicant [or later,
Cancellation No. 92049014
5
registrant] knowingly makes false, material
misrepresentations of fact in connection with his
application.” Torres v. Cantine Torresella S.R.L., 808 F.2d
46, 1 USPQ2d 1483, 1484 (Fed. Cir. 1986). Fraud may exist
where no use of the mark was made on some of the goods or
services recited in a use-based application as of the filing
date of the application, Maids to Order of Ohio Inc. v.
Maid-to-Order Inc., 78 USPQ2d 1899, 1905 (TTAB 2006), or an
intent-to-use application as of the filing date of the
statement of use, Medinol Ltd. v. Neuro Vasx, Inc., 67
USPQ2d 1205, 1209 (TTAB 2003). Fraud will not lie if it can
be proven that the statement, though false, was made with a
reasonable and honest belief that it was true. Woodstock’s
Enterprises Inc. (California) v. Woodstock’s Enterprises
Inc. (Oregon), 43 USPQ2d 1440, 1443-1444 (TTAB 1997).
Petitioner, as plaintiff in this proceeding, bears the
burden of proving, by clear and convincing evidence, its
asserted claim of fraud. Standard Knitting Ltd. v. Toyota
Jidosha Kabushiki Kaisha, 77 USPQ2d 1917, 1926 (TTAB 2006);
Smith International Inc. v. Olin Corp., 209 USPQ 1033, 1044
(TTAB 1981 (“It thus appears that the very nature of the
charge of fraud requires that it be proven ‘to the hilt’
with clear and convincing evidence. There is no room for
speculation, inference or surmise and, obviously, any doubt
must be resolved against the charging party.”).
Cancellation No. 92049014
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Petitioner asserts that respondent committed fraud
because its actions do not constitute “use in commerce” to
support registration. More specifically, petitioner argues
that because respondent only mails the envelopes and flyers
to addresses in the San Francisco Bay area its use of the
mark is only intrastate with no effect on interstate
commerce. Further, petitioner argues that:
Respondent’s description of services to the
Trademark Office was specific: that services were
aimed at recipients. However, respondent now
claims in its Brief that advertisers are the
customers and not recipients. Such a blatant
change to try to avoid a determination of fraud is
supported by Respondent’s own actions before the
Trademark Office during Respondent’s application
for registration.

Reply Br. p. 6.
Thus, petitioner argues that “the standard of ‘use in
commerce’ declared to be met in the September 15, 2003
Declaration by the Respondent should be based on services
rendered to recipients.” Reply Br. p. 5.
Respondent contends that petitioner’s argument “is
based on a complete misunderstand [sic] and confusion of who
exactly is a client of registrant’s and a consumer of its
services ...” Br. p. 9. Respondent further argues that
“Although WISE-BUYS is in fact a service mark, and
Registrant’s clients are not the recipients of its mailings,
the product offering does involve a tangible good – the
envelope with flyers and discount coupons, that is sent to
Cancellation No. 92049014
7
recipients free of charge. Precision Direct, Registrant’s
advertising placement broker, has been preparing and sending
these mailings from its production plant in Arizona to
California since 1998.” Br. p. 10. Further, respondent
argues:
...the clients themselves are often from out-of-
state, with some being important actors within the
national stream of interstate commerce. In
addition, the process of production of the custom
designed envelops [sic] and coupons takes place
outside of California. The envelopes then get
shipped to California from Arizona through the
channels of interstate commerce. Furthermore, the
process of client solicitation also very often
takes place outside of California. Most
importantly, all of these facts have been true
since the inception of the WISE-BUYS business. As
part of promoting its services, Registrant has,
since inception, solicited advertising, through
its out-of-state advertising placement broker,
Precision Direct, which is located in Arizona.
The fact that its advertising placement broker has
been out-of-state since [the] birth of
Registrant’s WISE BUYS mark is in itself
sufficient for a finding of use in commerce. In
addition, Precision Direct has promoted and sold
Registrant’s direct mail advertising services to
various national companies who are looking to
advertise in the San Francisco Bay Area market.

Br. p. 13.
Petitioner’s interpretation of the identification of
services is incorrect. While the identification of services
references the ultimate end user, the ordinary potential
purchasers of direct marketing services are advertisers.
Further, we find that respondent’s statement in a response
during prosecution of its application that “The only content
we produce is coupon advertisements from local advertisers”
Cancellation No. 92049014
8
is not inconsistent with its statement that its advertising
customers also include national advertisers who may have
local stores or franchises.
In view of our finding that the identification of
services includes advertisers as potential purchasers, we
look to the record to determine if respondent has used its
mark in commerce.
Use sufficient to support registration for a service
mark occurs “when it is used or displayed in the sale or
advertising of services and the services are rendered in
commerce, or the services are rendered in more than one
State or in the United States and a foreign country and the
person rendering the services is engaged in commerce in
connection with the services.” 15 U.S.C. §1127. Commerce
is defined as “all commerce which may lawfully be regulated
by Congress.” Id.
The type of use necessary to constitute “use in
commerce” has broadened over the years. See, e.g., Larry
Harmon Pictures Corp. v. The Williams Restaurant Corp., 929
F.2d 662, 18 USPQ2d 1292 (Fed. Cir. 1991) (restaurant
services provided in one state to interstate customers
deemed use in commerce); In re Gastown, Inc., 326 F.2d 780,
140 USPQ 216, 217 (CCPA 1964) (provision of auto services in
one state to customers who are traveling interstate on
federal highways in the course of engaging in interstate
Cancellation No. 92049014
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commerce, constitutes services in commerce); Maids to Order
of Ohio, Inc. v. Maid-To-Order, Inc., 78 USPQ2d 1899, 1907
(TTAB 2006) (“...our primary reviewing court and its
predecessor have held that the ‘use in commerce’ requirement
of Section 3 of the Act does not require as a prerequisite
to registration that an applicant’s services be rendered in
more than one state.”); The Coca-Cola Co. v. Fanta, 155 USPQ
276, 278 ((TTAB 1967) (“the mere fact that applicant is
physically located and doing business in California is not
controlling on whether or not his services are performed in
interstate commerce.”)
Use in commerce has been found, inter alia, based on
the following circumstances: 1) a local hotel that was
listed in out-of-state telephone directories and had
bookings made by licensed agents in other states, In re G.J.
Sherrard Co., 150 USPQ 311 (TTAB 1966); 2) a local retail
department store that served out-of-state customers and
mailed catalogs and advertisements to them, In re Federated
Department Stores, Inc., 137 USPQ 670 (TTAB 1963); and 3) a
billiard hall in Kansas that advertised in both Kansas and
New York, The United States Shoe Corp. v. J. Riggs West,
Inc., 221 USPQ 1020 (TTAB 1984). In United States Shoe, the
Board noted that:
...the courts have accorded a wide scope and
interpretation of the phrase “used in commerce” in
the Trademark Act (and elsewhere). Consistent
with this, the Board has recognized that it is not
Cancellation No. 92049014
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necessarily essential that a service mark be used
in connection with services rendered in more than
one state to satisfy “use in commerce”
requirements and that advertising of such services
in interstate commerce will establish a valid “use
in commerce.”

Id. at 1022.
In support of its assertion of use in commerce,
respondent submitted the declaration of its vice president
Mr. Steve Marcus, who states, inter alia:
4. ...Since the beginning of our business,
[1997] we have solicited advertising placements
through Precision Direct, Inc., (“Precision
Direct”), an advertising placement broker located
in Mesa, Arizona. Precision Direct has solicited
advertising placements from various national
companies, headquartered outside of California,
who are looking to advertise in the San Francisco
Bay Area market. A true and correct copy of a
letter from Lorrie L. Jarrett, an officer of
Precision Direct, explaining the services it
provides to us, dated March 26, 2008, is attached
hereto as Exhibit A.
5. Since starting work for us in the late
1990’s as our advertising placement broker,
Precision Direct has included advertising in its
mailings on our behalf from such recognized
national brands as DirectTV, Checks Unlimited (of
Colorado Springs, Colorado), Dish Network,
American Flag Labels (of Salem, Virginia), People
PC online, etc. True and correct copies of
coupons included in recent mailings done by
Precision Direct are attached hereto as Exhibit B.
6. Wise-Buys is, and has been since the late
1990’s, a member of the Independent Co-Op Mail
Dealers Association (ICOMEDA), a nationwide
network of direct mail marketers. I have been
attending meetings of ICOMEDA since I started this
business in order to promote our WISE BUYS mark
and to solicit advertising business from other
members of the organization, who come from all
over the country, including, but not limited to,
Arkansas, Alabama, Georgia, Illinois, Indiana,
Maryland, North Dakota, Tennessee, Virginia, and
Washington. ...
Cancellation No. 92049014
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10. In 1999 and 2000, we distributed various
discount coupons through our website, www.wise-
buys.com which anyone could printout, whether in
the San Francisco Bay Area, or without. A true
and correct copy of a printout from
internetarchive.org showing wise-buys.com website
as it existed on October 10, 1999 is attached
hereto as Exhibit E. ...
12. Since the early 2000s, prior to the date
of filing of the application for registration of
the WISE BUYS mark, we have advertised and
promoted our direct mail advertising services
through the internet, using our own website,
www.wise-buys.com. A true and correct copy of the
printout of www.wise-buys.com website is attached
hereto as Exhibit F.

Keeping in mind the cases discussed above, we find the
evidence sufficient to rebut petitioner’s assertion of no
use in commerce. Mr. Marcus’ declaration unambiguously sets
out that from its inception respondent has obtained its out-
of-state clients through an out-of-state broker and includes
coupons from these out-of-state or national advertisers in
its mailings to local businesses and residences. Petitioner
argues that the examples of coupons from national companies
in Exhibit B were from a 2007 mailing, and as such are not
probative of use prior to the filing date of the underlying
application; however, these examples do serve to corroborate
Mr. Marcus’ statement that such advertisements have always
been included in the mailings. Petitioner also argues that
the letter attached as Exhibit A from an officer of
Precision Direct, Inc., respondent’s advertisement broker
and printer located in Arizona, was not authenticated. We
find that the letter was sufficiently authenticated by Mr.
Cancellation No. 92049014
12
Marcus. However, we also find that the statements in the
letter do not suffice as an alternative to testimony,
because they are not presented in declaration or affidavit
form as required under the agreed terms of the ACR procedure
in this case. See Board Order dated January 22, 2009.
Therefore, we give the letter limited probative value.
Further, in view of the length of time these services
have been provided, even if the coupons from national
companies were a small part of each mailing, the record does
not support a finding that the number of coupons from
national companies was de minimis.
Finally, we find that various superfluous and
irrelevant statements by Mr. Marcus in his declaration
concerning petitioner’s motivations or other activities, do
not serve to undermine the veracity of his statements
concerning respondent’s business activities.
With regard to the intent element in the fraud claim,
because we have found that respondent’s claim of use was not
false, we find ipso facto that the claim was not made with
fraudulent intent.
In view of the above, petitioner has not carried its
burden of proof and its claim of fraud must fail.3

3 We note that because petitioner only asserted a claim of fraud,
it is held to the higher standard of clear and convincing proof.
However, even if we were to apply the preponderance of the
evidence standard for a claim of no bona fide use, petitioner
would not meet this lesser burden based on this record.
Cancellation No. 92049014
13
Decision: The petition to cancel Registration No.
2814955 is dismissed.