North American Bear Co., Inc.v.The Vermont Teddy Bear Co., Inc.

Trademark Trial and Appeal Board

Feb 25, 2003

No. 91107763 (T.T.A.B. Feb. 25, 2003)

Hearing: Mailed: February 25, 2003
February 11, 2003 Paper No. 41
RLS
UNITED STATES PATENT AND TRADEMARK OFFICE
_____
Trademark Trial and Appeal Board
______
North American Bear Co., Inc.
v.
The Vermont Teddy Bear Co., Inc.
_____
Opposition No. 107,763
to application Serial No. 75/030,467
filed on December 4, 1995
_____
James M. Amend, P.C. of Kirkland & Ellis for North American
Bear Co., Inc.
H. Jay Spiegel, Esq. of H. Jay Spiegel & Associates for The
Vermont Teddy Bear Co., Inc.
Before Simms, Hohein and Hairston, Administrative Trademark
Judges.
Opinion by Simms, Administrative Trademark Judge:
North American Bear Co., Inc. (opposer), an Illinois
corporation, has opposed the application of The Vermont
Teddy Bear Co., Inc. (applicant), a New York corporation, to
register the mark THE GREAT AMERICAN TEDDY BEAR for stuffed
THIS DISPOSITION IS NOT
CITABLE AS PRECEDENT
OF THE TTAB
Opposition No. 107,763
2
toy animals and for message delivery services accompanied by
stuffed toy animals.1
In the notice of opposition, opposer asserts that it
first used the mark NORTH AMERICAN BEAR CO. INC. no later
than November 1979 for stuffed toys; that it owns two
registrations covering this mark and this mark with a design
element for stuffed toys, the latter mark being shown
below;2
and that applicant’s mark THE GREAT AMERICAN TEDDY BEAR so
resembles opposer’s previously used and registered marks
NORTH AMERICAN BEAR CO. INC. with and without design as to
be likely to cause confusion, to cause mistake or to
1 Application Serial No. 75/030,467, filed December 4, 1995,
based upon applicant’s assertion of a bona fide intention to use
the mark in commerce. The words “TEDDY BEAR” have been
disclaimed.
2 Registration No. 1,365,742, issued October 15, 1985, Sections 8
and 15 declaration filed; and Registration No. 1,438,174, issued
April 28, 1987; Sections 8 and 15 declaration filed. In both
registrations the words “BEAR CO. INC.” have been disclaimed, and
Opposition No. 107,763
3
deceive. In its answer, applicant has denied the essential
allegations of the opposition and has asserted as an
“affirmative defense” that opposer’s mark is generic.
However, because this defense is an attack on opposer’s
pleaded registrations, applicant was required to file a
petition to cancel or a counterclaim seeking
cancellation of opposer’s pleaded registrations. See TBMP
§§318.02(b) and 319. Applicant has not done this.
Accordingly, no further consideration will be given to this
“affirmative defense.”3
Both parties have submitted notices of reliance upon
discovery depositions and/or discovery responses of the
other party. Opposer has also relied on its pleaded
registrations as well as on printed publications, and has
taken testimony. Both parties submitted briefs.
On August 8, 2001, the Board issued a final decision
sustaining this opposition, finding likelihood of confusion
of applicant’s mark THE GREAT AMERICAN TEDDY BEAR for
stuffed toy animals and for message delivery services
accompanied by stuffed toy animals with opposer’s mark and
trade name NORTH AMERICAN BEAR CO. INC. for stuffed toys.
the representation of the teddy bear has been disclaimed in the
’742 registration.
3 We note, however, that in Cancellation No. 28,205 applicant
herein did seek cancellation of one of opposer’s pleaded
registrations on the basis of allegations of fraud because
opposer had assertedly never used its mark as a trademark but
only as a trade name. On September 6, 2000, the Board dismissed
that petition for cancellation with prejudice.
Opposition No. 107,763
4
After applicant submitted a request for
reconsideration, noting that it had filed a request for an
oral hearing, the Board vacated its decision. Thereafter,
the Board set an oral hearing for this case on February 11,
2003, and attorneys for both parties appeared and argued
this case at that time.
Opposer’s Record
Opposer’s co-founder, Mr. Paul Levy, testified that
opposer has sold teddy bears with hangtags bearing the mark
NORTH AMERICAN BEAR CO. INC. since 1979. Levy dep., pp. 10,
17, 53. See Levy Exhibits 1 and 16 below, and other
hangtags of record.
Opposition No. 107,763
5
Opposer’s goods are sold to the general public in
retail and department stores, specialty stores including toy
stores, and flower, gift and card shops. Opposer’s goods
are also sold over the Internet and by means of catalogs of
other companies. The price range of opposer’s teddy bears
is $8 to $110. In the period 1992 to 1998, opposer’s sales
under the mark exceeded $140 million with almost 10 million
units sold and nearly $8 million in advertising expenses.
Levy dep., pp. 27–28. Since the company was founded,
opposer’s sales have reached almost one quarter of a billion
dollars. Levy dep., p. 29.
Opposition No. 107,763
6
Mr. Levy testified that applicant is a competitor with
goods of both companies being sold in the adult gift market.
The parties advertise in some of the same consumer
magazines, and the same articles have discussed the products
of both parties.
With respect to instances of actual confusion, Mr. Levy
testified, at p. 77:
Q. Did you find that any consumers
confused your mark with the Great
American Teddy Bear mark at the time
that Vermont was using it.
A. Yes. We had people calling us asking
about the opening of our store, you
know, in New York and a variety of other
calls.
And then I asked, you know, Loraine in
our office to keep track of all the
incidences of confusion that arose and
to keep a record of every call that we
got or ask customer service to keep
track of it. Asked everyone -– Asked
her to ask everyone in the company to
keep track of any confusion that
occurred during -– after this name
arose.
Opposer has made of record handwritten logs of alleged
instances of actual confusion.
Applicant’s Record
Applicant is a direct marketer of teddy bears and other
products. Applicant’s president and chief executive
officer, Ms. Elisabeth Robert, testified that applicant
began use of the mark herein sought to be registered in
1995. Applicant’s goods have been sold over the radio, by
Opposition No. 107,763
7
catalog and at its own retail stores, only one of which is
currently open. While at one time applicant considered
changing the name of its company to The Great American Teddy
Bear Company, applicant decided against this name change.
However, applicant continued to use the trademark THE GREAT
AMERICAN TEDDY BEAR until approximately the middle of 1997
(Burns discovery dep., p. 100). Applicant’s goods were sold
from inventory through the end of August or September 1998.
Robert discovery dep., pp. 93, 192. Applicant planned to
resume nationwide use in early 1999, by its catalog and its
retail store. Robert discovery dep., pp. 48, 129.
Applicant’s main competitors appear to be gift, candy and
mail-order flower businesses rather than teddy bear
retailers. Burns discovery dep., p. 22.
Applicant’s sales in 1997 were approximately $1.4
million, with advertising expenses around ½ million dollars
(Applicant’s Responses to Opposer’s Interrogatories 1(c) and
1(d)), mostly by means of radio advertisements. Most of
applicant’s sales are by mail order or by phone. Applicant
was aware of opposer and opposer’s marks before applicant
filed the instant application.
Ms. Robert was interrogated about applicant’s suit
against a third party for infringement of another of
applicant’s marks, and the steps taken by applicant at that
Opposition No. 107,763
8
time to document instances of actual confusion. Thereafter,
she testified:
Q And at the time that you learned of North
American Bear Company’s objections to The
Great American Teddy Bear mark, were there
ever any discussions about instituting that
same kind of plan?
A No.
Q Why not?
A Because we did not believe that it was
material, and we did not believe that it was
a threat to us.
Q What was a threat to Vermont Teddy Bear?
A The confusion between the North American
Teddy Bear Company, or North American Bear
Company, I’m sorry, and Great American Teddy
Bear Company.
Q Did you believe that there was confusion
out there?
A Yes, we did. We believed, based on what
you gave us, that there was – or what North
American Bear Company gave us – that there
could be confusion out there.
Robert discovery dep., p. 100. She testified, however, that
she knew of no instances of confusion between the marks
involved herein. See also Burns discovery dep., p. 77.
Applicant also took the testimony of an expert witness,
Mr. Herbert Larson, a practitioner in the field of patents
and trademarks for over 35 years. He testified that, in his
opinion, there was no likelihood of confusion between the
respective marks.4
4 We have chosen to give relatively little weight to this
testimony for the following reasons. First, Mr. Larson’s opinion
seems to be significantly influenced by the manner of opposer’s
usage in its catalogs and promotional material. However, the
expert did not apparently consider opposer’s ownership of federal
trademark registrations covering opposer’s pleaded marks, and the
presumptions of validity we must give to those registrations of
Opposition No. 107,763
9
There is no evidence of third-party use of similar
marks for teddy bears.
Arguments of the Parties
Essentially, opposer argues that the relevant factors
to be considered in the likelihood-of-confusion analysis
support its position that confusion is likely. Opposer
notes that it has used its marks for over 20 years and that
opposer’s significant sales and advertising as well as
favorable press coverage have resulted in “an enormous
amount of recognition and good will among consumers” (brief,
p. 5) so that opposer’s mark NORTH AMERICAN BEAR CO. INC.
must be considered famous or at least very strong in the
teddy bear market. Opposer states that its advertising
expenditures have averaged around $1 million per year.
It is opposer’s position that the marks of the parties
are substantially similar and convey similar overall
commercial impressions. In this regard, opposer notes that
both marks are multi-word phrases that share the significant
words “AMERICAN” and “BEAR.” Opposer argues that the
record. Applicant’s witness was also influenced by the fact that
opposer does not use the standard registration notice (®), which
the witness stated had a bearing upon his opinion on the issue of
likelihood of confusion. However, the presence or absence of a
registration notice is not a factor in the likelihood-of-
confusion analysis under In re E. I. du Pont de Nemours & Co.,
476 F.2d 1357, 177 USPQ 563 (CCPA 1973). We also must consider
the goods as described in opposer’s pleaded registration and in
applicant’s application, goods that are for our purposes legally
identical, which this witness did not do. For these and other
reasons, we have given little weight to Mr. Larson’s expert
testimony.
Opposition No. 107,763
10
respective marks have similar meanings and that, in
addition, opposer’s design depicting a teddy bear enhances
the likelihood of confusion.
With respect to the goods, opposer argues that they are
identically described products which are sold to the general
public in similar channels of trade, including by Internet
retailers. The respective goods are also advertised through
catalogs, and advertisements and editorial mentions have
appeared in some of the same publications. Opposer also
notes the lack of use of similar third-party marks as well
as opposer’s evidence of actual confusion. In this regard,
it is opposer’s position that the instances of actual
confusion increased at the time applicant opened its New
York store and began advertising its goods under its mark on
the radio. According to opposer, the instances of actual
confusion are illustrative of how confusion may occur if
applicant is permitted to register its mark. Opposer also
maintains that applicant prosecuted its application in bad
faith because, after the filing of the application, opposer
brought to applicant’s attention some of the instances of
actual confusion. Finally, opposer asks us to resolve any
doubt that we may have in favor of the prior user and
registrant.
Applicant, on the other hand, argues that the
respective marks are different in sound, appearance and
Opposition No. 107,763
11
meaning. Applicant maintains that the dominant parts of
opposer’s marks are the words “NORTH AMERICAN” while the
dominant part of applicant’s mark is the expression “GREAT
AMERICAN.” With respect to opposer’s marks, applicant
argues that “NORTH AMERICAN” is geographically descriptive
or misdescriptive (“North American” connoting goods coming
from Canada, the United States or Mexico, whereas opposer’s
goods are actually imported from Asia), and that this aspect
of opposer’s marks is not strong since “AMERICA” is commonly
used in many marks. Applicant contrasts this significance
with the words “GREAT AMERICAN” in its mark, which applicant
argues connotes very fine products made in the United
States.
It is also applicant’s position that opposer’s marks
are not famous or strong because there is no evidence of a
significant percentage of opposer’s advertising being used
to promote opposer’s asserted marks rather than other marks
by which it identifies its teddy bears. Also, according to
applicant, opposer’s advertising is directed to the use of
opposer’s asserted marks as a trade name and not as a
trademark.
With respect to the goods, applicant maintains that the
goods travel in different channels of trade because opposer
is a wholesaler whereas applicant is a direct distributor
selling its goods in its own stores, by mail order, by phone
Opposition No. 107,763
12
and over the Internet. Also, with respect to distinctions
in the goods, applicant argues that opposer’s goods are made
in Asia while its goods are made in the United States.
Applicant contends that opposer’s evidence of alleged actual
confusion is hearsay, which is not admissible as a business
record exception to this rule, because the evidence was
gathered in contemplation of this litigation, and is also
not admissible under the state-of-mind exception to the
hearsay rule. Further, applicant notes that opposer took no
testimony of anyone who was actually confused or of anyone
who compiled the information of alleged instances of actual
confusion. If anything, applicant maintains that this
evidence only suggests possible confusion between the
companies and not between their trademarks. Applicant
maintains that there has been no bad faith on its part
because, while applicant knew of opposer and one of its
registrations prior to applicant’s use, there is no evidence
that applicant adopted its mark to trade on any goodwill of
opposer.5
5 Applicant also argues that there is evidence of other “third-
party” marks since opposer failed to oppose another of
applicant’s marks -– THE ALL-AMERICAN TEDDY BEAR. However, aside
from its irrelevance, a copy of this registration or the
registration file has not been made of record. The reference to
applicant’s then-pending application in a letter from opposer’s
counsel does not serve to make either the application or the
subsequent registration of record. However, even if the
application or registration were of record, there is simply no
testimony or evidence of the nature and extent of the use of this
mark or that the relevant consumers are aware of it. Therefore,
we cannot determine its exposure to the relevant purchasers or
Opposition No. 107,763
13
Opinion and Decision
Because opposer has established its ownership of valid
and subsisting registrations, priority is not an issue in
this case. King Candy Company v. Eunice King's Kitchen,
Inc., 496 F.2d 1400, 182 USPQ 108 (CCPA 1974); and Carl
Karcher Enterprises Inc. v. Stars Restaurants Corp., 35
USPQ2d 1125 (TTAB 1995). In any event, the testimony
establishes opposer’s priority in this case. The only real
issue is whether applicant’s mark THE GREAT AMERICAN TEDDY
BEAR is so similar to opposer’s marks NORTH AMERICAN BEAR
CO. INC. with and without a teddy bear design that confusion
is likely.
Upon careful consideration of this record and the
arguments of the parties, we agree with opposer that
confusion is likely. First, while there are obvious
differences in the respective marks, opposer’s mark NORTH
AMERICAN BEAR CO. INC. and applicant’s mark THE GREAT
AMERICAN TEDDY BEAR have significant similarities in sound,
appearance and commercial impression. In this regard, both
opposer’s and applicant’s marks are multi-word marks, which
include the words AMERICAN and BEAR in that order, and both
signify or suggest that the teddy bears sold under those
marks are American (or North American) teddy bears. See
otherwise draw the conclusion which applicant apparently wants us
to draw-—that purchasers would not be confused because they would
be aware of other uses of similar marks for teddy bears.
Opposition No. 107,763
14
American Optical Corp. v. North American Optical Corp., 489
F.Supp. 443 (N.D.N.Y. 1979)(public would likely confuse
defendant’s name NORTH AMERICAN OPTICAL with protected
AMERICAN OPTICAL name). The image of a teddy bear in one of
opposer’s marks reinforces the similarity to applicant’s
mark, which contains the words TEDDY BEAR. Also, as opposer
has pointed out, the degree of similarity between marks
necessary to support a finding of likelihood of confusion
declines if the marks appear on identical goods, as in the
instant case. See Century 21 Real Estate Corp. v. Century
Life of America, 970 F.2d 874, 23 USPQ2d 1698 (Fed. Cir.
1992). There are no third-party uses of similar marks of
record, also tending to increase likelihood of confusion.
Kimberly-Clark Corp. v. H. Douglas Enterprises, Ltd., 774
F.2d 1144, 227 USPQ 541, 542 (Fed. Cir. 1985)(“Another
factor favoring [appellant] is that, in the field of
disposable diapers, only appellant had used (prior to
appellee's use of DOUGIES) a short, two-syllable mark ending
in "IES." There are no other goods of that type with that
suffix--except for DOUGIES.”)
With respect to the goods, we must consider the goods
as they are identified in the application and opposer’s
registrations, rather than what the evidence shows the
respective goods to be, or the particular channels of trade
or the class of purchasers to which the sales of goods are
Opposition No. 107,763
15
directed. In re Dixie Restaurants, 105 F.3d 1405, 41 USPQ2d
1531, 1534 (Fed. Cir. 1997); Octocom Systems, Inc. v.
Houston Computers Services Inc., 918 F.2d 937, 16 USPQ2d
1783, 1787 (Fed. Cir. 1990); Canadian Imperial Bank of
Commerce v. Wells Fargo Bank, 811 F.2d 1490, 1 USPQ2d 1813,
1816 (Fed. Cir. 1987); and Paula Payne Products v. Johnson
Publishing Co., 473 F.2d 901, 177 USPQ 76, 77 (CCPA 1973).
Because the goods must be considered substantially
identical, we also must assume (and the evidence supports
the fact that) the channels of trade in which these goods
and services are sold and the classes of purchasers to whom
they are sold are also substantially identical. Also,
stuffed teddy bears are not very expensive items and may be
purchased on impulse, or at least without careful
consideration, either as a child’s gift or perhaps as a
novelty gift for an adult. This factor also weighs in favor
of opposer. Moreover, applicant’s message delivery services
involving teddy bears are substantially related to opposer’s
teddy bears.
Although we are not convinced, at least on this record,
that opposer’s marks have achieved a famous status, we
nevertheless believe that they must be considered reasonably
strong and well-known in the field, with sales of teddy
bears and teddy bear accessories over 20 years approaching ¼
Opposition No. 107,763
16
billion dollars. Also, as noted, there is no evidence of
third-party use of similar marks.
While it is true that opposer’s marks consist of a
geographic term with generic and non-source-indicating or
non-distinctive matter (“BEAR CO. INC.”), a primarily
geographic term is, of course, entitled to protection upon
the acquisition of distinctiveness for the goods in
connection with which it is used. Here, not only have
opposer’s marks been in extensive and continuous use for
over 20 years, but also its registrations have been on the
register for over 15 years.
While we have considered the evidence with respect to
instances of actual confusion, we do not find it to be
entitled to much weight. First, the alleged instances of
actual confusion were recorded in reports given to opposer’s
witness, Mr. Levy. In other words, the alleged instances of
actual confusion were not heard or witnessed by opposer’s
witness but were merely reported to him. Mr. Levy’s
testimony about these instances is inadmissible hearsay.
See, e.g., Versa Products Co., Inc. v. Bifold Co.
(Manufacturing) Ltd., 50 F.3d 189, 33 USPQ2d 1801, 1818 (3d
Cir. 1995)(excluding testimony of a witness who was told
about alleged statements of confusion, where no testimony
was taken of the employees who received the calls and
inquiries); Copy Cop Inc. v. Task Printing Inc., 908 F.Supp.
Opposition No. 107,763
17
37, 38 USPQ2d 1171, 1173-74 (D.C.Mass. 1995)(“Copy Cop
through its president presents hearsay evidence of two
consumer queries to store employees indicating confusion…
Without direct testimony from the employees who heard these
queries, this evidence would not be admissible at trial…”);
Source Services Corp. v. Source Telecomputing Corp., 635
F.Supp. 600, 230 USPQ 290, 297 (N.D. Ill. 1986)(while
evidence from employees who received phone calls from
members of the public was allowed, unsworn reports prepared
by employees and forwarded to plaintiff’s president, who
testified, deemed hearsay and not allowed under the business
records exception of Fed.R.Evid. 803(6)). See also Blansett
Pharmacal Co. v. Carmrick Laboratories Inc., 25 USPQ2d 1473,
1476 (TTAB 1992)(statements attributed to others are hearsay
and entitled to no probative value); and Corporate Fitness
Programs Inc. v. Weider Health and Fitness Inc., 2 USPQ2d
1682, 1690-91 (TTAB 1987)(testimony of others is of little
probative value in the absence of testimony from the persons
allegedly confused as to whether they were confused and, if
so, what caused their confusion). We agree with applicant,
therefore, that it should have been able to cross-examine
the person or persons who received the phone calls or heard
the alleged instances of confusion so as to determine the
circumstances under which the alleged statements were made.
Moreover, as applicant has pointed out, instances where
Opposition No. 107,763
18
potential purchasers and others might have referred to
opposer (North American Bear Co., Inc.) as “Great American
Bear Company,” “Great American Teddy Bear Company” or “Great
American Bear” are not relevant inasmuch as those terms,
aside from not being the mark here sought to be registered,
were being used as trade or corporate names and not as
trademarks. Instances where inquiries were made as to
whether opposer was related to applicant (The Vermont Teddy
Bear Co.) are also not relevant to the issue of likelihood
of confusion between the marks NORTH AMERICAN BEAR CO. INC.
and THE GREAT AMERICAN TEDDY BEAR. Other recorded alleged
instances of actual confusion are vague and give
insufficient detail as to what precisely was said. Finally,
the fact that one report is of the return to opposer of a
“Vermont Teddy Bear product” from a retailer is of little
weight because it does not indicate what mark the returned
product bore. Suffice it to say that there is no evidence
of record that any person mistakenly purchased applicant’s
THE GREAT AMERICAN TEDDY BEAR product intending to purchase
opposer’s NORTH AMERICAN BEAR CO. INC. teddy bear.
Although we have given little or no weight, therefore,
to the instances of alleged actual confusion, we
nevertheless believe that confusion is likely. The test, of
course, is not whether these marks can be distinguished when
compared in a side-by-side analysis. The test is whether
Opposition No. 107,763
19
there is likely to be confusion in the marketplace where the
respective products bearing the marks are presumed to
appear. Due to the fallibility of memory and the consequent
lack of perfect recall, the proper emphasis is on the
recollection of the average purchaser, who normally retains
a general, rather than a specific, impression of trademarks.
In re United States Distributors, Inc., 229 USPQ 237, 239
(TTAB 1986). We conclude that purchasers, aware of
opposer’s NORTH AMERICAN BEAR CO. INC. (with and without
design) teddy bears who then encounter applicant’s THE GREAT
AMERICAN TEDDY BEAR teddy bears are likely to confuse the
source or origin of the goods. That is to say, a purchaser
who at one time had purchased opposer’s NORTH AMERICAN BEAR
CO. INC. teddy bear and then some time later encounters
applicant’s THE GREAT AMERICAN TEDDY BEAR teddy bear is
likely to believe, given an imprecise memory, that
applicant’s teddy bear is the same or similar teddy bear as
the one purchased before or, at any rate, comes from or is
sponsored or licensed by the same source as the earlier-
purchased product. Moreover, as noted above, applicant’s
message delivery services involving teddy bears are
substantially related to opposer’s teddy bears, and
purchasers familiar with opposer’s teddy bears sold under
its marks are likely to believe that applicant’s delivery
services involving teddy bears offered under applicant’s
Opposition No. 107,763
20
similar mark emanate from or are sponsored by the same
entity.
Finally, if we had any doubt regarding whether there is
a likelihood of confusion, we resolve that doubt in favor of
the prior registrant with longstanding prior use and against
the newcomer, especially where the applicant had prior
knowledge of the opposer’s use. Kenner Parker Toys v. Rose
Art Industries, 963 F.2d 350, 355, 22 USPQ2d 1453, 1458
(Fed. Cir. 1992).
Decision: The opposition is sustained and registration
to applicant is refused.