Panda Security, S.L.v.Panda Core Technology, Inc.

Trademark Trial and Appeal Board

Jan 8, 2013

No. 91191921 (T.T.A.B. Jan. 8, 2013)

THIS OPINION IS NOT A
PRECEDENT OF THE TTAB

Mailed:
January 8, 2013

UNITED STATES PATENT AND TRADEMARK OFFICE
_____

Trademark Trial and Appeal Board
_____

Panda Security, S.L.
v.
Panda Core Technology, Inc.
_____
Opposition No. 91191921
_____

Francis J. Duffin of Wiggin and Dana LLP for Panda Security, S.L.

Panda Core Technology, Inc., pro se.
_____

Before Zervas, Wellington, and Masiello, Administrative Trademark Judges.

Opinion by Masiello, Administrative Trademark Judge:

By order of May 18, 2011, the Board granted summary judgment to opposer
Panda Security, S.L. (“Registrant”), sustaining Registrant’s opposition on the basis
of Registrant’s common law rights and refusing registration to the opposed
application of Panda Core Technology, Inc. (“Claimant”). Now before us is
Claimant’s counterclaim for cancellation of Registrant’s U.S. Reg. No. 2921210 (the
“Registration”).
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As grounds for cancellation, Claimant has alleged that Registrant acquired
the Registration by means of an assignment in gross, in violation of Trademark Act
§ 10, 15 U.S.C. § 1060; that Registrant’s predecessor in interest obtained the
Registration on the basis of use by a licensee over which such predecessor exercised
no control (i.e., “naked licensing”); and that Registrant acquired the Registration
“especially for an attack of… Applicant’s trademark.” Respondent denied the
salient allegations of the counterclaim.
The Record
The record includes the pleadings and, by operation of Trademark Rule
2.122, 37 C.F.R. § 2.122, the registration history of the Registration. The record
also includes the following testimony and evidence:
A. Claimant’s Evidence.
1. Notice of Reliance on IRS Form 990 (Return of Organization Exempt
From Income Tax) filed by World Wildlife Fund Inc for 2006 Tax Year.

B. Registrant’s Evidence.

1. Testimony deposition of Pedro Bustamante, Registrant’s senior
research advisor and Vice President of product management, with
attached exhibits (“Bustamante deposition”).

2. Notices of Reliance on the following documents:

(a) Trademark Assignment by WWF-World Wide Fund For Nature
to Panda Security, S.L. dated May 6, 2009.

(b) Certified copy of Trademark Assignment by WWF-World Wide
Fund For Nature to Panda Security, S.L. dated May 6, 2009, as
recorded on May 15, 2009 in the U.S. Patent and Trademark
Office at Reel 00398, Frame 0044.

Opposition No. 91191921

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Standing
Claimant, by virtue of its position as defendant in this opposition proceeding,
has standing to seek cancellation of the Registration. Finanz St. Honore B.V. v.
Johnson & Johnson, 85 USPQ2d 1478, 1479 (TTAB 2007). No formal pleading or
other demonstration of standing is required. TBMP § 313.03 (3rd ed., rev. 1, 2012).
Discussion of the Merits
1. Assignment in violation of § 10.
It is a fundamental principle that a trademark has no independent
significance apart from the good will it symbolizes. United Drug Co. v. Theodore
Rectanus Co., 248 U.S. 90 (1918); American Steel Foundries v. Robertson, 269 U.S.
372 (1926); Prestonettes, Inc. v. Coty, 264 U.S. 359 (1924). This principle underlies
Section 10(a)(1) of the Trademark Act, which provides as follows:
A registered mark or a mark for which an application to
register has been filed shall be assignable with the good
will of the business in which the mark is used, or with
that part of the good will of the business connected with
the use of and symbolized by the mark.
15 U.S.C. § 1060(a)(1).
The separation of a trademark from the business reputation and good will of
which it is the symbol causes the mark to lose its significance as an indicator of
origin of goods or services. Defiance Button Machine Co. v. C & C Metal Products
Corp., 759 F.2d 1053, 225 USPQ 797, 801 (2d Cir. 1985), cert denied, 474 U.S. 844
(1985). Such separation effectively results in abandonment of the mark, as defined
in the Trademark Act: “A mark shall be deemed to be ‘abandoned’ … (2) When any
course of conduct of the owner, including acts of omission as well as commission,
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causes the mark… to lose its significance as a mark.” 15 U.S.C. § 1127 (definition of
“Abandonment of mark”).
The Registration that Claimant seeks to cancel, No. 2921210, was issued by
the U.S. Patent and Trademark Office on January 25, 2005. The Registration
relates to the trademark PANDA, in standard character form, and the identified
goods are “Anti-virus computer software.” The owner is identified on the original
registration certificate as “WWF-WORLDWIDE FUND FOR NATURE
(FORMERLY WORLD WILDLIFE FUND) (SWITZERLAND NON-PROFIT
FOUNDATION)” (“Registrant’s Predecessor”). Title records of the Patent and
Trademark Office indicate that on May 6, 2009, Registrant’s Predecessor assigned
the Registration and the trademark PANDA to Registrant. Claimant alleges that
this transfer separated the registered mark from the good will that it symbolizes.
Applicant argues:
[T]he WWF Fund was never involved in the business of
production of anti-virus software, to which the trademark
“Panda” was initially registered. WWF Fund is engaged
exclusively with the protection and conservation of
wildlife and its activity has nothing to do with the
production of the computer anti-virus software. WWF
Foundation is a nonprofit (charitable) organization that is
exempt from tax, and it cannot engage in the business of
manufacturing commercial antivirus software.1
In support of this contention, Claimant has submitted the 2006 U.S. tax return on
Form 990 of World Wildlife Fund Inc.2 This tax return is not competent evidence

1 Claimant’s brief at 2.
2 Claimant’s notice of reliance. This document is not properly authenticated for purposes of
admitting it as a public record. See FRE 902(4). However, Registrant has not objected to
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for the purpose of supporting Claimant’s allegations. It was filed by an entity called
World Wildlife Fund Inc., while Registrant’s Predecessor was a Swiss entity named
WWF-Worldwide Fund for Nature. Claimant has provided no evidence of a
relationship between these two entities. Rather, the information in the record
suggests that they are not the same entity. For example, as early as November 26,
2002, Registrant’s Predecessor identified itself as “WWF-Worldwide Fund for
Nature (formerly World Wildlife Fund), a Switzerland non-profit foundation.”3 As
late as May 5, 2009, Registrant’s Predecessor identified itself as “WWF-Worldwide
Fund For Nature, a foundation constituted and existing under and by virtue of the
laws of Switzerland.”4 These facts are inconsistent with Claimant’s apparent
suggestion that the company that identified itself as “World Wildlife Fund Inc.” on
the Form 990 (which was signed on February 14, 2008) is the same entity as
Registrant’s Predecessor. On the present record, the 2006 tax return cannot be
interpreted to indicate anything about the nature of Registrant’s Predecessor or its
business.
Nothing else in the evidence or arguments of Claimant supports Claimant’s
allegation that “WWF Fund is engaged exclusively with the protection and
conservation of wildlife … and it cannot engage in the business of manufacturing
commercial antivirus software.”5 Applicant appears to suggest that aspects of the

the admission of this document. Inasmuch as we find the document to have no relevance to
this proceeding, we need not exclude it on procedural grounds.
3 Application Serial No. 76473182, filed November 26, 2002.
4 Assignment to Registrant, recorded at Reel 00398, Frame 0044.
5 Claimant’s brief at 2.
Opposition No. 91191921

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United States tax laws that apply to “nonprofit (charitable) organization[s]” would
prohibit Registrant’s Predecessor (a Swiss entity) from engaging in the business of
computer software. On the present record we cannot make any such finding. As
this allegation is the entire basis of the claim that Registrant obtained the
Registration by means of an assignment that violated § 10, Claimant has failed to
establish sufficient facts to support its claim.
We note, moreover, that Registrant has made of record testimony and
documentary evidence6 sufficient to show that between the years 2000 and 2009,
Registrant produced and marketed anti-virus computer software marked with the
PANDA trademark under contractual arrangements with Registrant’s Predecessor
whereby all resulting good will inured to the benefit of, or was assigned to,
Registrant’s Predecessor.7 This evidence indicates that when the mark was assigned
to Registrant, good will existed in the hands of Registrant’s Predecessor and such
good will was transferred to Registrant with the mark. The evidence also indicates
that the good will that derived from Registrant’s use of the mark (and inured to the
benefit of Registrant’s Predecessor) related directly to business efforts of
Registrant.8 Accordingly, the policy considerations underlying § 10 and the rule
against assignments in gross are not offended by the transfer of the mark to

6 Virtually all of the relevant testimony and documentary evidence submitted by Registrant
were designated “Highly Confidential.” Accordingly, we will endeavor to discuss it in only
general terms.
7 Bustamante deposition, pp. 35-56 and Exhibits 9 through 13 (various agreements between
Registrant’s Predecessor and Registrant (or its affiliates).
8 Bustamante deposition, pp. 10-16 and Exhibit 2 (“Sales of Panda Products Made in the
USA Made by Panda Security, S.L. and Panda Distribution, Inc.”)
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Registrant: at the time of the assignment, the reputation symbolized by the mark
was already closely related to the business reputation of Registrant, so that
continuing to market goods of Registrant under a mark that symbolizes Registrant’s
reputation would not deceive the public. We find that Claimant has failed to
substantiate its claim under Trademark Act § 10.
2. Naked licensing.
Claimant’s second ground for cancellation appears to be that Registrant’s
Predecessor obtained the Registration on the basis of use of the mark by a licensee
over which Registrant’s Predecessor exercised no control. This ground for
cancellation is not set forth with great clarity either in Claimant’s pleading or in its
brief. Claimant’s germane allegations, as set forth in its counterclaims, are as
follows:
11. Statement of Use for the “Panda” trademark
(registration number 2921210) contains pages printed
from the [Registrant’s] website.… [Registrant] was a
licensee of the WWF….
12. [Claimant] is informed and believes that the WWF
has never produced and currently does not produce
antivirus software. …
13. [Claimant] believes that the “Panda” trademark
has never symbolized any antivirus software produced
directly by the WWF or by any subdivision of the WWF or
by another company, which belongs to or is controlled by
the WWF.
…
17. As a control of the licensor (the WWF) over the
licensee ([Registrant]) is missing, [Claimant] believes that
the “Panda” trademark was initially registered with a
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naked license,… which in fact is produced by an unrelated
and uncontrolled company.9
Claimant argues the point in its brief as follows:
Thus, the registration of the trademark “Panda”
(registration number 2921210) was initially
fictitious, because the mark cannot used [sic] in the
business of the company that owned it (until May
2009), and licensed “in gross” to unrelated and
uncontrolled company, without licensing of any
specific and called tangible or intangible property,
intended in the production of computer antivirus
software.
…
In addition, the Panda Security S.L. did not provide any
documents that would indicate that the WWF Fund in
any way to control the quality of products manufactured
under the trademark “Panda” (until May 2009).
Analyzing these facts, we believe that the registration of
the trademark “Panda”… by the non-profit charity fund
specializing in the protection of nature, is initially
fictitious and it is obvious to any sensible person.10
As best we can discern, the substance of Claimant’s “naked licensing”
allegation appears to be that:
(a) during the prosecution of the application underlying the Registration,
Registrant’s Predecessor filed a statement of use that relied upon use of the
mark solely by its licensee, the Registrant;

(b) Registrant’s use of the mark was not controlled by Registrant’s Predecessor
in any way that would cause Registrant’s use to inure to the benefit of
Registrant’s Predecessor;

(c) as a result, Registrant’s Predecessor had made no use of the mark that it
could rightfully claim as its own use at the time the statement of use was
filed;

9 Claimant’s counterclaims for cancellation, ¶¶ 11-13 and 17.
10 Claimant’s brief at 2-5 (emphasis in original).
Opposition No. 91191921

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(d) consequently, the Registration issued in violation of Trademark Act Section
1(b)(3), which requires that an acceptable statement of use be filed prior to
the issuance of any registration (“Except for applications filed pursuant to
section 1126 of this title, no mark shall be registered until the applicant has
met the requirements of subsections (c) and (d) of this section.”).11

We can discern no other statutory ground for cancellation in Claimant’s
pleadings. Claimant may not rely on any claim that was not adequately pleaded, as
Registrant would be without fair notice as to the nature of the claim against which
it must defend, and would thereby be deprived of procedural due process rights.
P.A.B Produits et Appareils de Beaute v. Satinine Societa in Nome Collettivo di S.A.
e.M. Usellini, 570 F.2d 328, 196 USPQ 801, 804 (CCPA 1978).
We find that Claimant has failed to make a prima facie demonstration of
relevant facts to establish its “naked licensing” claim. As before, we find the 2006
U.S. tax return on Form 990 of World Wildlife Fund Inc. to have no relevance to the
issues before us. Claimant has presented no other evidence.
Registrant, for its part, has made of record testimony and documentary
evidence showing that between the years 2000 and 2009, Registrant and
Registrant’s Predecessor entered into a series of arm’s-length agreements pursuant
to which Registrant used the PANDA mark in the United States in connection with
anti-virus computer software and assigned all of the resulting good will to
Registrant’s Predecessor.12 Although the documents identified as Exhibits 9

11 15 U.S.C. § 1051(b)(3).
12 Bustamante deposition, pp. 35-56 and Exhibits 9 through 13 (various agreements
between Registrant’s Predecessor and Registrant (or its affiliates).
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through 12 are not expressly denominated “licenses,”13 Registrant’s senior research
advisor and Vice President of product management, in his testimony, characterized
Exhibit 9 as a “contract for… licensing the use of the Panda trademark.”14 He went
on to characterize Exhibit 10 as “an addendum to the licensing contract which
basically extends the licensed use of the Panda trademark”;15 Exhibit 11 as “another
extension to the licensing agreement”;16 and Exhibit 12 as “another extension of the
licensing agreement to use the Panda trademark.”17 The same witness explained
that the agreements under discussion “were relevant to my responsibilities and
duties as director of marketing” “because my responsibilities included branding of
the company, marketing of the products, design of the marketing elements,
packaging, all of which included the Panda trademark.”18
Exhibits 9 through 12 do not contain express provisions relating to quality
control. However, Registrant’s witness testified that quality control commitments
were part of Registrant’s arrangement with Registrant’s Predecessor:
Q. As a part of Panda Security’s agreements with
WWF, was Panda Security obligated to exercise any
quality control?
A. Yes.
Q. And what did Panda Security do adhere to that
obligation? [sic]

13 Only Exhibit 13 is expressly entitled “Licensing Agreement.”
14 Bustamante deposition, p. 35, ll.20-22;
15 Id. at p. 40, ll. 22-24.
16 Id. at p. 43, ll. 7-8.
17 Id. at p. 46, l. 25 – p. 47, l.1.
18 Id. at 42, ll. 8-10 and 13-17.
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A. We had two types of controls. First of all, we had
internal controls performed by an internal quality control
team. And we also had external quality controls and in
the external quality controls, we commissioned two
entities which perform independent quality controls on
antivirus software.
Q. And how are you familiar with those two types of
quality control?
A. In my role as director of marketing, I oversaw
development and product management of the products,
which included the internal quality controls and I also
negotiated and managed the external quality control
organizations….19
The witness then named the two external quality control organizations.20
We accept the characterization given by Registrant’s witness to the
arrangement between Registrant and Registrant’s Predecessor. The agreements at
issue are contracts between a Swiss entity and a Spanish entity, governed by Swiss
law, regarding use of the mark in the United States. The interpretation of
Registrant’s witness, who was a knowledgeable person involved in the business
transactions that were governed by the agreements, is the best evidence before us
as to the significance of the agreements. Claimant has neither addressed the
agreements in his brief nor adduced any evidence capable of rebutting the
testimony of Registrant’s witness.21 That testimony indicates that at the relevant
times, Registrant’s use of the PANDA trademark was subject to its agreements with
Registrant’s Predecessor, and that those agreements imposed upon Registrant an

19 Id. at p. 32, l. 13 through p. 33, l. 10.
20 Id. at 32, ll. 10-11.
21 Claimant had the opportunity to introduce evidence to rebut Registrant’s evidence during
Claimant’s rebuttal testimony period.
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obligation to comply with standards controlling the nature and quality of the goods
offered under the trademark. Under such circumstances, Registrant’s Predecessor
could validly rely upon Registrant’s use of the PANDA mark when Registrant’s
Predecessor filed its statement of use. The Trademark Act contemplates that marks
may be registered on the basis of use by a licensee:
Where a registered mark or a mark sought to be
registered is or may be used legitimately by related
companies, such use shall inure to the benefit of the
registrant or applicant for registration, and such use shall
not affect the validity of such mark or of its registration,
provided such mark is not used in such manner as to
deceive the public.
15 U.S.C. § 1055 (emphasis supplied).
Accordingly, we find that Claimant has failed to prove that Registrant’s
Predecessor obtained the Registration in violation of Trademark Act Section 1(b)(3).
3. Registrant’s acquisition of the Registration “especially for an attack.”
In Count Three of its counterclaims, Claimant alleges that Registrant and
Registrant’s Predecessor took action to shift ownership of the Registration to
Registrant only after it was discovered that Claimant had filed an application to
register a “Panda” mark.22 Claimant alleges that this action was motivated by the
expectation that Registrant would have a stronger case against Claimant than
would Registrant’s Predecessor.23 Claimant suggests that Registrant and

22 Counterclaims, ¶ 5.
23 Id., ¶¶ 7-8.
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Registrant’s Predecessor might even have planned to make the transfer to
Registrant temporary, “for a short time.”24
These allegations, as set forth in ¶¶ 5-10 of the counterclaims, fail to state a
cognizable statutory ground for cancellation of the Registration. There is no
inherent impropriety in acquiring a trademark registration for the purpose of
obtaining priority over another. Dial-A-Mattress Operating Corp. v. Mattress
Madness, 841 F. Supp. 1339, 33 USPQ2d 1961, 1967 n. 10 (E.D.N.Y. 1994),
reconsideration denied, 847 F. Supp. 18, 33 USPQ2d 1961 (E.D.N.Y. 1994) (“senior
user status may be properly achieved by assignment in anticipation or in the midst
of litigation”). Moreover, after trial, these allegations remain unsupported by any
evidence. Claimant has failed to demonstrate any ground for cancellation based
upon these allegations.
4. Other counts.
Paragraphs 1 and 19 of the counterclaims are designated as “Count One” and
“Count Five.” Paragraph 1 merely alleges that the Registration “is completely
regulated by the laws of the United States….” Paragraph 19 describes the damage
suffered by Claimant. Neither paragraph expresses any statutory ground for
cancellation of the Registration, and Claimant has not argued the relevance of
either allegation in its brief. Accordingly, we have not treated Count One and
Count Five them as separate grounds for cancellation requiring disposition.

24 Id., ¶ 10.
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Decision: The counterclaim for cancellation is dismissed with prejudice on
all grounds.