TTAB Declares That Reckless Disregard For The Truth = Fraud

• Published date: 07 October 2021
• Subject Matter: Intellectual Property, Criminal Law, Trademark, White Collar Crime, Anti-Corruption & Fraud
• Law Firm: Pryor Cashman LLP
• Author: Ms Dyan Finguerra-DuCharme and Jesse Roth

In a momentous decision, the Trademark Trial and Appeal Board has officially concluded that "reckless disregard satisfies the requisite intent for fraud on the USPTO in trademark matters." In Chutter, Inc. v. Great Management Group, LLC, 2021 U.S.P.Q.2d 1001 (T.T.A.B. 2021), a consolidated Cancellation and Opposition proceeding, the Board granted a petition of cancellation by Plaintiff Chutter, Inc. ("Chutter") filed against Defendant Great Concepts, LLC's ("Great Concepts") registration for the mark DANTANNA'S in Class 43 for "steak and seafood restaurant," based on a finding of fraud. Plaintiff's pleaded fraud claim, and the Board's finding of fraud came as a result of an admittedly false statement made by counsel in Great Concepts' Section 8&15 Declaration filed in 2010.

In particular, counsel submitted the sworn declaration asserting, among other things, that "there is no proceeding involving said rights pending in the United States Patent and Trademark Office or in a court and not finally disposed of." 15 U.S.C. ' 1065. This statement was decidedly, and admittedly, false, as, at the time, there was both a pending cancellation proceeding and a federal litigation regarding Great Concepts' right to register and use the mark DANTANNA'S. As a result, the Board answered the question that the Federal Circuit left unanswered in In re Bose Corp., 580 F.3d 1240 (Fed. Cir. 2009) - whether reckless disregard for the truth or falsity of a material statement made in a filing with the USPTO satisfies the intent to deceive requirement.

In Bose, the declarant included a false statement regarding use of a mark in commerce in a maintenance filing. The Court held that "fraud in procuring or maintaining a trademark registration occurs when an applicant for registration, or a registrant in a post registration setting, knowingly makes a false, material representation of fact in connection with an application to register, or a post registration document, with the intent of obtaining or maintaining a registration to which it is otherwise not entitled." Further, that "a party alleging fraud in the procurement or maintenance of a registration bears the heavy burden of proving fraud with clear and convincing evidence" and that "the Board will not find fraud if the evidence shows that a false statement was made with a reasonably and honest belief that it was true, rather than an intent to mislead the USPTO into issuing a registration to which the applicant was not otherwise...