ADventures in Law

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At the National Advising Division (NAD), competitors will sometimes go for the brass ring, the big prize, the whole enchilada, and ask the NAD to recommend that an advertiser’s trademarked slogan or even the brand name be discontinued. Many companies that are new to the NAD have tried to defend such challenges, asserting, “That’s trademarked so it can’t be deceptive or misleading.” The NAD dating back decades has said that it will review product claims, whether or not they are found in a registered trademark, noting that the United States Patent Trademark Office (USPTO) does not review a trademark application for substantiation. Additionally, product names can also include claims that the NAD will evaluate. But there is a heightened standard for that review. Largely the NAD will require consumer perception survey work showing evidence of consumer confusion about the mark and will not recommend a company discontinue a product name without it. On rare occasion, the NAD will find without a survey that a name is so expressly false on its face that the name should be changed, such as with Green Tea Fat Burner dietary supplement or Aromatherapy Collection essential oils or Ultra 2X Cover paint or Spotless Blemishes face mask. Most other times in the absence of quality consumer protection survey work, the NAD will not ask an advertiser to stop using an ambiguous tradename just because a challenger alleges it is misleading.

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In a new twist on this, the <a href="https://bbbprograms.org/media-center/dd/planting-hope">NAD was asked to look at</a> whether the use of the registered trademark symbol or ® is itself a claim. In the quick 20-day start-to-finish SWIFT track, Rivinia Foods, Inc. challenged the use of the ® by Planting Hope Brands for its product name RIGHTRICE. Planting Hope bought the RIGHTRICE brand from its original owner a few years ago and the use of the trademark was assigned to it. However, the USPTO subsequently canceled the mark in a default judgment proceeding. Planting Hope filed a motion to set aside the default judgment. But in the meantime, Riviana Foods asked the NAD to recommend Planting Hope refrain from using the registered mark symbol with RIGHTRICE. And the NAD agreed and recommended the use of the registered mark symbol in advertising be discontinued.

This is the first case we remember seeing like this. The NAD has jurisdiction over reviewing claims in national advertising that “include any paid commercial message, in any medium (including labeling), if it has the purpose of inducing a sale or other commercial transaction or persuading the audience of the value or usefulness of a company, product or service.” The use of the ® is important to make clear the mark is being used as a trademark and not merely as a descriptive or generic term. That said, intentionally misusing a mark may result in losing the right to register the mark or to get an injunction against an infringer. But it is hard to see how use of the ® while not technically registered is inducing a sale of RIGHTRICE or portraying the value of RIGHTRICE itself – still, the NAD often takes a broad view of its jurisdiction. It will be interesting to see if this is a one-off or if the NAD becomes a forum where companies battling on the oft IP front jump in. In the meantime, if you needed any more encouragement to protect your marks, this case is a good one to remember.

Can Your Trademark Be False Advertising?