Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA490963
`ESTTA Tracking number:
`08/24/2012
`
`Filing date:
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`91204986
`Plaintiff
`Xylem Group, LLC
`James M. Slattery
`Birch Stewart Kolasch & Birch
`8110 Gatehouse Rd.Ste. 100 East
`Falls Church, VA 30076
`UNITED STATES
`jms@bkb.com,mailroom@bskb.com,johnst@bskb.com,bg@bskb.com
`Motion to Suspend for Civil Action
`James M. Slattery
`jms@bkb.com,mailroom@bskb.com,johnst@bskb.com,bg@bskb.com
`/James M. Slattery/
`08/24/2012
`2012-08-24 Motion to Suspend.pdf ( 52 pages )(2031948 bytes )
`
`Proceeding
`Party
`
`Correspondence
`Address
`
`Submission
`Filer's Name
`Filer's e-mail
`Signature
`Date
`Attachments
`
`

`
`Docket No. 5854-0l09L
`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`In the Matter of Application No. 85/386,849 filed on August 7, 2011
`For the Trademark “XYLEM” (Stylized) in International Classes 1, 6, 7, 9, ll, 35, 36,
`37, 40 and 42
`
`XYLEM GROUP, LLC.
`
`Opposer
`
`V.
`
`XYLEM IP HOLDINGS LLC.
`
`Applicant.
`
`€\&\2%\./\&%\}§/
`
`Opposition No. 91204986
`
`MOTION TO SUSPEND PENDING THE DECISION OF
`
`THE UNITED STATES DISTRICT COURT FOR THE
`
`NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION
`
`Opposer, XYLEM GROUP, LLC. (hereinafter “Opposer”) a limited partnership
`
`organized under the laws of Georgia, with a principal place of business at 205 Hembree
`
`Park Dr., Ste. 130, Roswell Georgia 30076, hereby through its attorney moves to suspend
`
`the above—captioned proceeding pending disposition of a civil action initially filed in the
`
`United States District Court for the Southern District of New York, No. 11 CIV. 5783 by
`
`ITT CORPORATION AND XYLEM INC., parties in privity with the Applicant. This
`
`civil action was subsequently refiled in the United States District Court for the Northern
`
`District of Georgia Atlanta Division, No. 1:11 CIV. 3669—JEC.
`
`Applicant, a party in privity with ITT CORPORATION AND XYLEM INC.,
`
`originally filed the above-identified intent
`
`to use trademark application under the
`
`

`
`company name Water IP Holdings LLC to register the trademark “XYLEM” (Stylized)
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`(Application No. 85/3 86,849) for various goods and services in International Classes 1, 6,
`
`7, 9, 11, 35, 36, 37, 40 and 42. Water IP Holdings LLC changed its name to XYLEM IP
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`Holdings LLC on October 10, 2011. The application was published for opposition on
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`April 10, 2012.
`
`Opposer filed a Notice of Opposition to Application Serial No. 85/386,849,
`
`claiming (1) that Opposer will be harmed by the registration of the mark XYLEM
`
`(Stylized), based on likelihood of confusion as to source, sponsorship or affiliation; (2)
`
`prior use of the mark XYLEM; (3) lack of intent to use; (4) intent to commit fraud; (5)
`
`likelihood of dilution; and (6) unfair competition based on the belief that the subsequent
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`registration of Application No. 85/386,849 would be likely to cause confusion, or to
`
`cause mistake, or deceive as to the affiliation, connection or association of App1icant’s
`
`corporation with that of Opposer’s.
`
`Believing itself not to infringe or dilute Opposer’s federal registered trademark or
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`common law rights, ITT CORPORATION AND XYLEM INC., parties in privity with
`
`the Applicant, initially filed a civil action seeking a declaratory judgment that their use of
`
`the mark XYLEM does not infringe Opposer’s federal and common law rights. The
`
`pleadings in this civil action were initially filed in the United States District Court for the
`
`Southern District of New York, No. 11 CIV. 5783 by ITT CORPORATION AND
`
`XYLEM INC., parties in privity with the Applicant. The civil action was subsequently
`
`refiled on October 26, 2011 in the United States District Court for the Northern District
`
`of Georgia Atlanta Division, No. 1:11 CIV. 3669-JEC.1 See, attached Exhibit A.
`
`1 The case was later reasigned as 1:11-CV-3669-WSD.
`2
`
`

`
`On December
`
`12, 2011, Xylem Group filed its answer, defenses, and
`
`counterclaims asserting counterclaims for: (1) federal trademark infringement; (2) federal
`
`unfair competition; (3) unfair competition under Georgia law; (4) dilution in violation of
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`Georgia law; (5) unfair competition under New York law; and (6) violation of New York
`
`law on anti-dilution.
`
`Disposition of the civil action will determine whether use of the mark by ITT
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`CORPORATION AND XYLEM INC., parties in privity with the Applicant, will result in
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`a likelihood of confusion, dilution, and unfair competition. Accordingly, it is respectfully
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`submitted that all further proceedings in Opposition No. 91204986 be suspended pending
`
`disposition of Civil Action No. 1:11 CIV. 3669-WSD.
`
`Grounds for Motion
`
`When a party to a case pending before the Trademark Trial and Appeal Board
`
`(TTAB) is also involved in a civil action that may have bearing on the decision to be
`
`rendered by the TTAB,
`
`the Board may suspend the proceeding until
`
`the final
`
`determination of the civil action. See, 37 C.F.R. § 2.ll7(a); TBMP § 5l0.02(a). This is
`
`because “a decision by the United States District Court would be binding on the Patent
`
`Office; whereas, a determination by the Patent Office as to respondent’s right to retain its
`
`registration would not be binding or res judicata in respect to the proceeding before the
`
`federal district court.” Whopper-Burger, Inc. v. Burger King Corporation, 171 U.S.P.Q.
`
`805, 1971 WL 16554 (T.T.A.B. 1971). A court’s decision regarding the right
`
`to
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`registration is binding on the TTAB. Seven-Up Co. v. Bubble Up Corp, 50 C.C.P.A.
`
`1012, 312 F.2d 472, 136 U.S.P.Q. 210 (1963); see also, In re Alfred Dunhill Limited, 224
`
`U.S.P.Q. 501, 1984 WL 63164 (T.T.A.B. 1984); J. Thomas McCarthy, 4 McCarthy on
`
`

`
`Trademarks and Unfair Competition (4th ed. 2006). ITT CORPORATION AND XYLEM
`
`INC., parties in privity with the Applicant, and Opposer are both parties to the civil
`
`action, which is currently pending before the Northern District of Georgia Atlanta
`
`Division.
`
`Applicant “XYLEM IP HOLDINGS LLC” is a subsidiary of XYLEM INC.
`
`(Xylem, Inc.’s 4”‘ Quarter 2011, 10-K filing with the SEC, p. 123). XYLEM INC.
`
`exercises exclusive control over XYLEM IP HOLDINGS LLC. Furthermore,
`
`ITT
`
`CORPORATION, also a party to Civil Action No. 1:11 3669-WSD, previously owned all
`
`the stock and exercised exclusive control over XYLEM INC. On October 31, 2011
`
`XYLEM INC owner of XYLEM IP HOLDINGS LLC (“Applicant”), was “spun off’
`
`from ITT CORPORATION. The “spin off” occurred approximately 5 days after Civil
`
`Action 1:ll 3669-WSD was filed with the District Court for the Northern District of
`
`Georgia, Atlanta Division. Moreover, it should be noted that Application No. 85/386,849
`
`was filed August 2, 2011,
`
`two months prior
`
`to the “spin—off.” As
`
`such,
`
`ITT
`
`CORPORATION,
`
`the company with exclusively control over XYLEM INC and its
`
`subsequent subsidiaries, which include XYLEM IP HOLDINGS LLC (“Applicant”) was
`
`in direct privy with Applicant.
`
`Attached hereto and marked Exhibit B is the Expert Report of Philip B. Hampton,
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`II, an expert hired by ITT CORPORATION AND XYLEM INC., parties in privity with
`
`the Applicant, to provide testimony in the pending civil action in the United States
`
`District Court in Georgia, Atlanta Division. As set forth in paragraph 9 of Mr. Hampton’s
`report, ITT CORPORATION AND XYLEM INC. is collectively referred to as ITT. As
`
`set forth in paragraph 27 and 30 of Mr. Hampton’s report, ITT (through an affiliate) filed
`
`4
`
`

`
`Application Serial No. 85/371,193 and 85/386,849 to register the marks XYLEM and
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`Xylem stylized. Mr. Hampton confirms that ITT CORPORATION AND XYLEM INC.
`
`is parties in direct privy with the Applicant.
`
`In addition, during the deposition of Peter
`
`Van Winkle, in house counsel for ITT CORPORATION, in the pending civil action in
`
`the United States District Court in Georgia, Atlanta Division the following testimony was
`
`provided (these pages are attached as Exhibit C):
`
`Pg. 46 - P. VAN WINKLE
`21
`Q. The decision to create a company
`22
`called Water IP Holdings, LLC, tell me about
`23
`the decision to create that company.
`24
`A. That legal entity was created in
`25
`the context of the spinoff transaction. ITT
`
`Pg. 47 - P. VAN WINKLE
`2
`had a holding -- an IP holding company called
`3
`ITT Manufacturing Enterprises Inc, I think,
`4
`at the time. And there are a number of
`
`5
`6
`7
`8
`
`9
`10
`11
`12
`13
`14
`15
`
`16
`17
`18
`19
`
`Trademarks and patents for ITT held in ITT
`Manufacturing Enterprises. And at some point
`when we completed the spinoff, we needed a
`receiver for those assets. So Water IP
`
`Holdings LLC were created for that.
`Q. And there is some discussion either
`before or after this email about wanting to
`keep the filings of trademarks anonymous
`at least from being named under the name of ITT.
`What do you recall about that?
`A. That's correct. That there was a
`
`desire to keep the identity at least at the
`time we were negotiating or at least prior to
`making any kind of a trademark application
`filing secret.
`
`Pg. 48 - P. VAN WINKLE
`3
`Q. Was there any other reason for
`4 forming Water IP Holdings LLC and registering
`5
`the trademarks under that name?
`
`6
`7
`8
`
`A. Water IP Holdings, LLC, was not
`formed for the purpose of keeping trademarks
`secret, the trademarks filing secret.
`5
`
`

`
`9
`10
`1 1
`12
`13
`14
`
`15
`16
`
`just happened to be—- it wasn't named by myself.
`It was named by somebody else. As they were
`creating new legal entities in the context of
`the spin, they were naming them with what I
`would call pretty generic names, water being
`because it would -— there was WaterCo in the
`
`spin, and there was DefenseCo in the spin,
`so.
`
`Pg. 51 - P. VAN WINKLE
`22
`Q.
`It looks like there's a decision
`23
`being made to reach out to the Spanish
`24
`company NA and engage them in coexistence
`25
`agreement discussions?
`
`Pg. 52 - P. VAN WINKLE
`A. Yeah. The trademark filing and the
`reaching out to Xylema were at least being
`contemplated as happening almost at the same
`time. And I believe there was a -— from a
`
`S’5{’[,,“_;_‘$§:3\ooo\1oxu:4>wN
`
`strategy perspective, we preferred to have to
`try to lock in our rights first before
`engaging in the negotiations.
`And then I believe Frank had some
`
`concerns about you know, not revealing the
`identity of ITT, at least at the time, if
`we went and engaged with NA first, then there
`was a risk —— they probably wouldn't
`deal with us anyways if they didn't
`know who we were. So it was just really trying to
`flesh out the strategy of filing first and
`then negotiating.
`
`Notwithstanding this complex parent and subsidiary company structure, it is clear
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`that both plaintiff’ s to the civil action are the same parties or at least those in privy,
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`involving essentially the identical issues as are raised in the instant proceeding. In the
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`pending civil action,
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`the District Court will determine the rights of XYLEM INC
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`(exclusive owner of XYLEM IP HOLDINGS LLC, Applicant) and XYLEM GROUP
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`LLC (“Opposer”) with respect to the “XYLEM” mark. It is clear that this determination
`
`6
`
`

`
`will directly affect the resolution of the issues before the TTAB. See, The Other
`
`Telephone Company v. Connecticut National Telephone Company, Inc., 181 USPQ 125,
`
`1974 WL 19878 (T.T.A.B. 1974).
`
`Based on the foregoing, Opposer respectfully requests that the TTAB suspend this
`
`proceeding pending the final determination of the Civil Action.
`
`Dated: August 24, 2012
`
`Respectfully Submitted,
`
`
`
`BIRCH STEWART KOLASCH & BIRCH, LLP
`
`8110 Gatehouse Road, Suite 100B
`
`Falls Church, VA. 22042
`Tel: 703-205-8000
`
`Fax: 703-205-8050
`
`E-mail: mailroom@bskb.com
`
`

`
`CERTIFICATE OF SERVICE
`
`I certify that a copy of Opposer’s MOTION TO SUSPEND PENDING THE
`DECISION OF UNITED STATES DISTRICT COURT FOR THE NORTHERN
`
`DISTRICT OF GEORGIA was served by first class mail postage prepaid to:
`
`Jason K. Schmitz, counsel for Applicant, at
`BAKER & MCKENZIE LLP
`
`130 E Randolph St, Ste. 3500
`~ Chicago, IL. 60601-6342 United States.
`chiusptomail@bakermckenzie.com
`
`August 24, 2012
`
`By
`
`\g
`
`C %y\3.
`
`

`
`
`
`EXHIBIT A
`EXHIBIT A
`
`

`
`IN THE UNITED STATES DISTRICT COURT
`
`FOR THE NORTHERN DISTRICT OF GEORGIA
`ATLANTA DIVISON
`
`ITT CORPORATION and
`
`XYLEM INC.,
`
`Plaintiffs,
`
`V
`
`XYLEM GROUP, LLC,
`
`Defendant.
`
`)
`
`;
`3
`;
`;
`
`)
`
`i
`
`Civil Action
`File No. 1:11-CV-3669-WSD
`
`EXPERT REPORT OF PHILIP G. HAMPTON, II
`
`1.
`
`This constitutes an Expert Report prepared by me, Philip G. Hampton, II,
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`pursuant to Federal Rule of Civil Procedure 26(a)(2)(B), in connecfion with the above-
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`referenced matter. I have been retained as an expert in the above-captioned case by counsel on
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`behalf of plaintiffs to offer an expert opinion regarding Various trademark issues raised in the
`
`instant matter.
`
`2.
`
`I reserve the right
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`to supplement the opinions set forth herein based on
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`additional
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`information provided to me or in response to expert reports submitted by
`
`defendant. In reaching my opinions as expressed herein, lreviewed the materials identified in
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`Exhibit A to this report.
`
`3.
`
`I have been an intellectual property law attorney for more than thirty years. I am
`
`a member of the Bars of the State of New York, the District of Columbia and the United States
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`Patent and Trademark Office.
`
`

`
`4.
`
`I received a S.B. degree and a S.M. degree in Chemical Engineering from the
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`Massachusetts Institute of Technology in 1977, and my J.D. degree from the University of
`
`Chicago in 1980.
`
`5.
`
`From 1980 until 1993, and continuously since 1998, I have been engaged in the
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`private practice of intellectual property law. During my years in private practice, my practice has
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`been limited to intellectual property law and almost exclusively to patent and trademark law. In
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`the trademark area, I have prosecuted domestic and foreign trademark applications, conducted
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`cancellation and opposition proceedings before the Trademark Trial and Appeal Board and
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`litigated trademark infringement and unfair competition cases before various federal district
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`courts. While in private practice, I have served in leadership positions in several intellectual
`
`property law associations, including the American Intellectual Property Law Association, the
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`International Trademark Association and the IP Law Section of the American Bar Association
`
`and the National Bar Association.
`
`I have also given numerous presentation on a Wide
`
`variety of intellectual property law topics.
`
`6.
`
`On November 4, 1993, President Clinton announced his intention to nominate me
`
`to become the Assistant Commissioner for Trademarks at the United States Patent and
`
`Trademark Office ("PTO"). While I was confirmed as the Assistant Commissioner for
`
`Trademarks by the United States Senate on May 6, 1994, I began my tenure at the PTO on
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`December 9, 1993, as the Assistant Commissioner for Trademarks - Designee.
`
`I served as the
`
`Assistant Commissioner for Trademarks until I returned to the private practice of law on
`
`October 15, 1998.
`
`7.
`As the Assistant Commissioner for Trademarks, I _was the CEO of the trademark
`operations at the PTO and responsible for the day—to—day operation and policy direction of the
`
`Trademark Office.
`
`I testified before Congress on proposed legislation, represented the United
`
`

`
`States at diplomatic conferences and other international meetings, oversaw the re-engineering of
`
`the Trademark Ofiice and was responsible for the policies of the Trademark Ofiice, including
`
`examination policies related to Sections 2(d) of the Lanham Act, i.e., namely, likelihood of
`confusion.
`I
`
`8.
`
`As part of my policy responsibilities, I issued more than 150 Commissioner's
`
`Decisions, reviewed every Letter of Protest, created the framework for the implementation of the
`
`Trademark Law Treaty and oversaw the issuance of a new edition of the Manual of Trademark
`
`Examining Procedure. In order to carry out my policy responsibilities, I was familiar with the
`
`trademark examination practices and procedures.
`
`9.
`
`I have been retained as an expert in the above—captioned case by counsel on behalf
`
`of Plaintiffs, ITT Corporation and Xylem Inc. (collectively, "ITT"), to offer expert testimony
`
`regarding the nature, quality and content of ITT’s trademark clearance process preceding the
`
`adoption of the XYLEM mark for its water technology spin-off; the determination of the
`
`United States Patent and Trademark Office that the parties’ respective marks are not
`
`confiisingly similar; and ITT’s dealings with Novedades Agricola S.A. (“Novedades”)
`
`concerning its XILEMA mark.
`
`10.
`
`Attached as Exhibit B to this report is a copy of the most current version of my
`
`curriculum vitae, which further describes my professional experience and qualifications in the
`
`areas oftrademark law and as an expert witness. As an expert witness for the plaintiffs, my law
`
`firm ['2] will be compensated at the rate of $700.00 per hour.
`
`11.
`
`I have been an expert witness and prepared expert reports and provided
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`deposition testimony as an expert witness in all areas of trademark law, including examination
`
`policies and procedures of the PTO, likelihood of confusion and infringement. Attached as
`
`Exhibit C and Exhibit D, respectively are a list of the cases at which I have been retained as an
`
`expert witness and cases [?] in whichl have served as a special master.
`
`

`
`12.
`
`As a trademark practitioner for more than thirty years, I am familiar with the
`
`process used to select and clear trademarks for adoption and use.
`
`I am also familiar with
`
`how to gauge the strength of a trademark and the legal and practical ramifications of a
`
`relatively weak trademark.
`
`13.
`
`As a former Assistant Commissioner for Trademarks and an experienced
`
`practitioner, I am familiar with how trademark applications and registrations are examined and
`
`maintained at the PTO.
`
`1 am also quite familiar with the training provided to Trademark
`
`Examining Attorneys to ensure that trademark applications are properly examined.
`
`I.
`
`ITT’s Adoption of the Name and Mark XYLEM
`
`14.
`
`On January 12, 2011, ITT announced its intent to transform itself into three
`
`publicly-traded companies ~— a manufacturing company, a water technology company, and
`
`a defense and security company. A group of ITT executives were charged with naming
`
`the water and fluid-management company.
`
`15.
`
`To assist it in the naming and branding of the water technology company,
`
`ITT hired Lippincott, a brand consulting company.
`
`Initially, Lippincott proposed
`
`seventeen possible names for the water technology company. After discussions with the
`
`ITT executives, including several who would assume management responsibilities in the
`
`water technology company, the list of possible names/trademarks was narrowed to seven.
`
`Because the water technology company and its brand would be used world-wide, ITT’s
`
`outside trademark counsel, Baker & McKenzie International (“B&M”), conducted world-
`
`wide trademark searches for each of the proposed trademarks.
`
`l6.
`
`B&M presented its search results in a comprehensive search report in late
`
`May 2011. The sole focus of the B&M report was the prospect of securing trademark
`
`registration in the various jurisdictions. The report noted:
`
`“This report is
`
`.
`
`.
`
`.
`
`only
`
`

`
`indicative of the likelihood of registration of each trademark concerned .
`
`.
`
`. Once the
`
`choice is made or narrowed down, it may become advisable to deepen the analysis for the
`
`trademark of choice.” The report also noted that it was based on the assumption the mark
`
`would be used on several very general product categories.
`
`It noted that after more detailed
`
`consideration of the intended product uses, “some of the obstacles pointed out [might]
`
`become less relevant.
`
`17.
`
`Although, in the U.S., registration of a trademark in light of preexisting uses
`
`of similar marks is governed by a standard that is generally similar to the standard
`
`employed by courts
`
`in determining trademark infringement, determinations of
`
`registrability (and attorneys’ predictions of registrability when counseling their clients) are
`
`usually more conservative (i.e., more likely to rule against
`
`the newcomer)
`
`than
`
`infringement determinations. This is due in part
`
`to the fact
`
`that when assessing
`
`registrability the U.S. PTO considers a narrower range of facts and circumstances than
`
`does a court in an infringement case. For instance, unless an application specifically
`
`declares that sale of the applicant’s goods/services will be through specific channels of
`
`trade, the PTO assumes that all possible channels of trade will be used.
`
`18.
`
`In its overall assessment, B&M opined that there might be “high difficulty”
`
`in obtaining trademark protection for a XYLEM mark in the U.S. Similarly, it opined that
`
`there might be high difficulty in obtaining trademark protection for three of the other
`
`marks in at least one of the primary countries in which the water technology company
`
`planned to operate.
`
`19.
`
`B&M’s report noted that there were risks to obtaining trademark protection
`
`for goods in the relevant classes (International Classes 6, 7, 9 and 11) in five primary
`
`countries, along with several EU counties.
`
`In at least half of those countries, B&M noted
`
`that XILEMA or XYLEMA registrations owned by Novedades created the potential
`
`

`
`impediment to trademark protection. Only in the United States was the XYLEM mark
`
`owned by Xylem Group found to be a possible impediment.
`
`20.
`
`Incorporating the trademark searches of B&M, on June 2, 2011, Lippincott
`
`presented a document “Naming the new water company-summary of full legal, linguistic
`
`and URL evaluations.” This report assessed the risk of adopting XYLEM as the trademark
`
`for the water company as “low/medium” (p. 6). Lippincott also noted that there may be a
`
`higher hurdle to registration of XYLEM “[b]ecause XYLEM is a descriptive, real term”
`
`(p. 28).
`
`21.
`
`After receiving Lippincott’s report, there were extensive communications
`
`over a six—week period among various executives and in-house attorneys at ITT, and with
`
`outside trademark counsel, regarding adoption of the name and trademark for the water
`
`technology company. Counsel considered the risks of adopting XYLEM in light of
`
`preexisting uses of that mark by third parties. There was specific considerations of the
`
`risks of adopting XYLEM in light of the U.S. registration held by Xylem Group. After
`
`investigating and considering the matter, counsel concluded that the risks associated with
`
`the preexisting Xylem Group mark were low, and so advised senior management. On July
`
`14, 2011, ITT announced that the water technology company would be named XYLEM.
`
`22.
`
`The process used by ITT in choosing XYLEM as the name and trademark
`
`for its water technology business Was almost a textbook example of the proper way for a
`
`company to clear and adopt a name.
`Initially, either with or without a consultant, a
`number of potential marks are proposed —— some because of sound or written appearance,
`
`others because they somehow suggest the product or service or suggests a desirable
`
`attribute of the product or service. Then each proposed trademark is searched to determine
`
`whether it is available for use and registration. Rarely does a trademark search find
`
`absolutely no risk associated with the use and/or registration of a proposed mark.
`
`Instead,
`
`

`
`business and marketing people, along with their attorneys, must decide on a particular
`
`mark based upon several factors, including common law uses of the mark, third-party uses
`
`of a similar mark and the world—wide availability of the mark.
`
`23.
`
`From my review of the reports produced by Lippincott, the trademark search
`
`report produced by B&M and the extended email discussions among executives, in-house
`
`lawyers and outside counsel,
`
`it is my opinion that ITT adopted the name and mark
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`XYLEM for its water technology business after appropriately and reasonably taking into
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`account all of the relevant factors. There is no indication that HT believed there would be
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`any marketplace confusion upon its adoption of the name and mark XYLEM or that it
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`disregarded Xylem Group’s trademark rights.
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`II.
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`US PTO Correctly Found Marks Not Confusingly Similar
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`24.
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`As part of their training, new Examining Attorneys are taught to search the
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`Principal and Supplemental Registers for marks in prior filed applications and registrations
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`that may cause a likelihood of confusion with the applicant’s mark. Examining Attorneys are
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`taught to consider a number
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`factors in determining whether two marks are confusingly
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`similar, not just the similarity in sight, sound and meaning of the marks, and the relatedness
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`of the identified goods and services. Examining Attorneys are also taught that under the
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`doctrine of foreign equivalents, two marks are identical if they are merely translations of one
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`another. If an Examining Attorney is found to have approved a mark for publication that is
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`likely to cause confusion with a prior filed or registered mark, the error is noted in the
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`Examining Attorney’s performance appraisal.
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`25.
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`On December 14, 1995, Novedades filed Application Serial No. 75/032,605
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`for its XILIMA trademark for various products used in connection with its irrigation
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`business. The application was reviewed by the USPTO, which found that there were no
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`

`
`confusingly similar U.S. trademarks or applications. In a June 16, 1996, Ofiice Action, the
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`Examining Attorney asked whether XILEMA had any significance in the relevant trade or
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`any geographical significance or if it had any meaning in a foreign language. On December
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`9, 1996, Novedades’ counsel informed the Examining Attorney that XILIMA was Spanish
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`for XYLEM. On December 11, 2001, the ‘605 application issued as U.S. Trademark Reg.
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`No. 2,515,972 for “water distribution apparatus, namely irrigation sprinklers, plumbing
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`fittings, namely valves, cocks and bibs” and for “the storage and delivery of irrigation and
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`fertilization apparatus and products for others.”
`
`26.
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`On December 5, 2005, Xylem Group filed Application Serial No. 78/766,777
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`to register XYLEM for various bathroom and kitchen fixtures and lighting fixtures and for
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`bathroom furniture.
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`In reviewing the ‘777 application, the Examining Attorney did not
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`conclude that the ‘972 registration was confusing similar to it, even though ( 1) “XILEMA” is
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`Spanish for “XYLEM” and under the doctrine of foreign equivalents is deemed identical to
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`XYLEM for purposes of analysis, and (2) and both marks are used on goods involving water.
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`The ‘777 application issued as U.S. Trademark Reg. No. 3,183,362 on December 12, 2006.
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`27.
`
`On July 14, 2011, ITT (through an affiliate) filed Application Serial No.
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`85/371,193 for XYLEM for scores of different water-related goods and services, including
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`marine toilets. On November 9, 2011, the PTO issued an Office Action in which the
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`Examining Attorney determined that
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`the mark covered by the ‘193 application was
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`confusingly similar to the mark covered by the ‘362 registration, the XYLEM mark owned by
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`Xylem Group. According to the Examining Attorney, the marks were identical and there was
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`at least some overlap of goods. But, the only overlap the Examining Attorney cited was as to
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`marine toilets claimed in ITI"s application. The Examining Attorney also found that the ‘ 193
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`application might be confusingly similar to pending Application Serial No. 85/222,988 for
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`XYLEM, owned by AqueSys, Inc. for ophthalmic surgical devices.
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`

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`28.
`
`In its two responses to the Office Action, ITT correctly pointed out that mere
`
`identity of the marks is not enough — the goods and services, channels of trade and
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`sophistication of customers must also suggest
`that
`the marks would be confused.
`Specifically, after deleting marine toilets, ITT pointed out that goods were not so similar as to
`
`be confusing, particularly since each party’s goods would be expected to be sold in widely
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`disparate channels of trade and that purchasers of HTS goods were highly sophisticated,
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`making confusion almost impossible. The Examining Attorney accepted this argument.
`
`29.
`
`On April l0, 2012, the ‘l93 application was published. The ‘l93 application
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`was opposed by Defendant on May 1, 2012.
`
`30.
`
`On August 2, 2011,
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`ITT (through an affiliate)
`
`filed Application No.
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`85/386,849 to register a stylized XYLEM mark for the same of goods as was covered by the
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`‘193 application. As with the ‘193 application,
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`the PTO originally found the mark
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`confusingly similar to the ‘362 registration. But. After ITT submitted the arguments as it had
`
`during the prosecution of the '19:’: application, the ‘849 application was allowed, published
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`and opposed by the Defendant.
`
`31.
`
`In light of PTO rules and procedures, the sequence of events described above
`
`shows unambiguously that the PTO concluded that, except as to marine toilets, there is no
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`likelihood of confusion between lTT’s XYLEM mark and the XYLEM mark of Xylem
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`Group. The PTO reached that conclusion even though ITT’s applications were not restricted
`
`as to the channels of trade in which ITT proposed to use the marks.
`
`III.
`
`Novedades Has a Stronger Worldwide Trademark Position than Xylem
`Group
`
`32.
`
`XYLEM is not a made-up, or coined, term. Rather, it is a defined word
`
`meaning “a compound tissue in vascular plants that help provide support and that conducts
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`water and nutrients ...” (Dictionarycom).
`
`In other words, XYLEM when used as a
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`

`
`trademark suggests “water.” Therefore, since under U.S. trademark law, the XILEMA mark
`
`owned and used by Novedades and the XYLEM mark owned and used by Defendant are
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`weak marks and Plaintiffs goods were not similar to those of either company, those marks
`
`did not create a significant risk to lTT’s use and registration of its XYLEM mark in the
`
`United States.
`
`33.
`
`In the United States, the goods and/or services for which the mark is used must
`
`be identified with specificity. However, in many jurisdictions around the world, the goods
`
`and/or services can be specified generally. For example, Novedades’ Chilean registration for
`
`XILEMA covers “distribution machines for water and irrigation.” And in countries such as
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`Argentina” an applicant has to specify the entire class of goods or services.
`
`34. My review of ITT’s clearance process indicates that ITT concluded that it did
`
`not wish to adopt the XYLEM name unless it could secure a coexistence agreement with
`
`Novedades, the owner of the XILEMA mark. ITT did not take that position with respect to
`
`Xylem Group’s XYLEM mark.
`
`In my opinion,
`
`that different treatment was justified.
`
`Novedades had (and has) a much stronger trademark position vis—a~vis a XYLEM trademark
`
`than Xylem Group.
`
`35.
`
`The B&M report disclosed that Novedades (or affiliates) holds registrations for
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`XILEMA in multiple significant markets in which ITT operates — Argentina, Brazil, Chile,
`
`Mexico, Venezuela (XYLEMA), the United States, Spain, and France.
`
`ITT’s investigation
`
`revealed that the goods upon which Novedades was using its XILEMA trademark were only
`
`somewhat similar or complementary to goods upon which ITT was planning to use a
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`XYLEM trademark.
`
`Therefore, while ITT believed its goods were different
`
`from
`
`Novedades’ goods and that Novedades had less than a 50% chance of blocking ITT’s
`
`registration of the XYLEM mark in any particular country, ITT concluded that given the
`
`number of countries involved, the risk of being blocked from registration in at least one
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`

`
`significant market was unacceptably high. By contrast, Xylem Group owns a registration in
`
`only one jurisdiction,
`
`the United States, for goods that are dissimilar to those of HT.
`
`Consequently, ITT concluded that the risk of Xylem Group preventing it from obtaining a
`
`registration for its XYLEM trademark in any significant jurisdiction was very low.
`
`36.
`
`I understand that, in exchange for Novedades’ entering a coexisting agreement,
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`ITT paid Novedades 200,000 Euros, equivalent to about $250,000.
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`In my opinion, if one
`
`were to assume (contrary to the facts and ITT’s own, conclusion) that there is an arguable
`
`likelihood of confusion between ITT’s XYLEM mark and Xylem Group’s XYLEM mark,
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`the value of a coexistence agreement with Xylem Group as of July 2011 would have been
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`significantly less tha11 $250,000.
`
`37.
`
`The opinions stated in this written report are based on my education,
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`background, knowledge and experience in trademark law and my review of the information
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`currently available to me. As noted above, I reserve the right to expand upon or modify my
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`opinions and/or offer additional opinions in response to any information that becomes
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`available to me in connection with any matters raised by defendant and/or any opinions
`
`provided by any experts retained by defendant.
`
`Date:
`
`June 20, 2012
`
`By: ?Philip 6. Hampton,
`
`...._
`
`-1}-
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`

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`Exhibit A
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`Materials Reviewed
`
`File history of Registration No. 2,515,972
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`File history