BULKY DOCUMENTS
`(exceeds 300 pages)
`
`Proceeding] Serial No: 92045 172
`
`Filed: 01-19-2007
`
`Title: Memorandum Opposing
`Petitioner’s/ Counter—Registrant’s Motion for
`Summary Judgment
`
`Part 1 of 1
`
`

`
`‘\
`.a'I
`
`Peter M. de Jonge
`Gordon K. Hill
`
`THORPE NORTH & WESTERN, LLP
`
`8180 South 700 East, Suite 350
`Sandy, Utah 84070
`Telephone: (801) 566-6633
`Facsimile: (801) 566-0750
`
`Attorneys for XEL Herbaceuticals, Inc.
`
`TRADEMARK
`DOCKET NO. 258 l 7
`
`TTAB
`“M 07¢ 505’
`
`6
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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`TRADEMARK TRIAL AND APPEAL BOARD
`
`
`Cancellation No. 92/045,172
`
`MEMORANDUM OPPOSING
`PETITIONER/COUNTER-
`
`REGISTRANT’S MOTION FOR
`SUMMARY JUDGMENT
`
`HERBACEUTICALS, INC.,
`
`Petitioner,
`
`V.
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`XEL HERBACEUTICALS, INC.,
`
`Registrant.
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`XEL HERBACEUTICALS, INC.,
`
`Counter Petitioner,
`
`v.
`
`HERBACEUTICALS, INC.,
`
`Counter Registrant,
`
`
`01-19-2007
`
`U.S. Patent &TMOfc/TM Mail Rcpt Dr. #1
`
`

`
`TABLE OF CONTENTS
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`STATEMENT OF DISPUTED FACTS .
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`1
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`. 2
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`ARGUMENT .
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`I.
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`HERBACEUTICALS HAS NO STANDING TO PETITION
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`CANCELLATION OF XEL’S TRADEMARKS BECAUSE
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`HERBACEUTICALS’ TRADEMARKS ARE GENERIC .
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`3
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`II.
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`XEL DID NOT COMMIT FRAUD IN OBTAINING ITS TRADEMARKS .
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`A.
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`XEL DID NOT MAKE FALSE STATEMENTS .
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`XEL DID NOT OBTAIN REGISTRATION OF
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`B.
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`TRADEMARK TO WHICH IT WAS NOT ENTITLED .
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`C.
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`ANY FALSE STATEMENTS IN XEL’S STATEMENTS
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`OF USE ARE NOT MATERIAL TO REGISTRATION
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`OF THE TRADEMAR WITH RESPECT TO THE
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`OTHER GOODS IN USE .
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`. 7
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`THE PROPER REMEDY IS NOT CANCELLATION,
`BUT AMENDMENT OR PARTIAL CANCELLATION .
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`D.
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`E.
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`I 1
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`CASE LAW CITED BY HERBACEUTICALS IS
`LEGALLY AND FACTUALLY DISTINGUISHABLE .
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`III.
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`HERBACEUTICALS IS ESTOPPED FROM OBTAINING
`CANCELLATION OF XEL’S TRADEMARKS BASED ON LACHES .
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`1 1
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`CONCLUSION .
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`I3
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`

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`TABLE OF AUTHORITIES
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`Federal Cases:
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`Bridgestone/Firestone Research, Inc. v. Automobile Club
`De L ’0uest De La France, 245 F.3d 1359 (Fed.Cir. 2001) .
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`. .11
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`Burlington Indus. v. Dayco Corp., 849 F.2d 1418 (Fed.Cir. 1988) .
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`. .10
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`Celotex Corp. v. Catrett, 477 U.S. 317 (1986) .
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`Copelands ’ Enterprises Inc. v. CNVInc., 20 USPQ2d 1295 (Fed.Cir. 1991) .
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`Cunningham v. Laser GolfCorp., 222 F.3d 943 (Fed.Cir. 2000) .
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`Edison Bros. Stores, Inc. v. Cosmair, Inc., 2 USPQ2d 1013 (SDNY 1987) .
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`. .7
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`H. Marvin Ginn Corp. v. International Association of
`Fire Chiefs, Inc., 782 F.2d 987 (Fed.Cir. 1986) .
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`. 6
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`Horizon Healthcare Servs. v. Allied Nat ’l, Inc.,
`2006 U.S. Dist. LEXIS 5440, *26 (D.N.J. Feb. 10, 2006) .
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`In re Merrill, Lynch, Pierce, Fenner and Smith, Inc., 828 F.2d 1567 (Fed.Cir. 1987) .
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`Metro Traffic Control v. Shadow Network, 104 F.3d 336 (Fed.Cir. 1997) .
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`. .4
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`Morehouse Mfg. Corp. v.
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`.1. Strickland & Co., 407 F.2d 881 (CCPA 1969) .
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`. .7
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`Opryland USA Inc. v. The Great American Music Show Inc.,
`23 USPQ2d 1471 (Fed.Cir. 1992) .
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`.3
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`Ritchie v. Simpson, 170 F.3d 1092 (Fed.Cir. 1999) .
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`Torres v. Cantine Torresella S. r. l., 808 F.2d 46 (Fed.Cir. 1986) .
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`. 4
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`T.T.A.B. Decisions:
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`Alcan Aluminum Corp. v. Alcar Metals, Inc., 200 USPQ 742 (TTAB 1978) .
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`. 7
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`Grand Canyon West Ranch, LLC v. Hualapai Tribe,
`2006 TTAB LEXIS 82, 78 USPQ2d 1696 (TTAB Mar. 17,2006) .
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`. .6, 8, 9, 11
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`In re SunGuard Development Corporation,
`1999 TTAB LEXIS 735, *9-10 (TTAB June 9, 1999) .
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`. 10
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`J.E.M. International, Inc. v. Happy Rompers Creations Corp.,
`2005 WL 548069, Cancellation No. 92043073 (TTAB Feb. 10, 2005) .
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`Medinol Ltd. v. Neuro Vasx Inc., 67 USPQ2d 1205 (TTAB 2003) .
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`Pennwalt Corp. v. Sentry Chemical Co., 219 USPQ 542 (TTAB 1983) .
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`Procter & Gamble v. Economics Laboratory, Inc., 175 USPQ 505
`(TTAB 1972), modified, without op., 181 USPQ 722 (CCPA 1974) .
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`Rogers Corp. v. Fields Plastics & Chemicals, Inc.,
`176 USPQ 280 (TTAB 1972), afl’d, 181 USPQ 169 (CCPA 1974) .
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`Smith International, Inc. v. Olin Corporation, 209 USPQ1033 (TTAB 1981) .
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`Space Base, Inc. v. Stadis Corp., 17 USPQ2d 1216 (TTAB 1990) .
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`Turner v. Hops Grill & Bar, Inc., 52 USPQ2d 1310 (TTAB 1999) .
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`Federal Statutes and Other Authorities:
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`15 U.S.C. §1064 .
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`Trademark Law Treaty Implementation Act of 1998,
`Pub.L.No. 105-330, 112 Stat. 3064 .
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`. 9
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`iii
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`

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`MEMORANDUM OPPOSING PETITIONER/COUNTER-REGISTRANT’S
`
`MOTION FOR SUMMARY JUDGMENT
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`Petitioner/Counter-Registrant, Herbaceuticals, Inc. (hereinafter “Herbaceuticals”),
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`filed a Motion for Summary Judgment on or about December 5, 2006 (hereinafter “SJ
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`Motion”). Registrant/Counter-Petitioner, XEL Herbaceuticals, Inc. (hereinafter “XEL”),
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`hereby urges this Board to deny Herbaceuticals’ SJ Motion because Herbaceuticals’
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`trademarks are invalid because they are generic, and because XEL did not commit fraud on
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`the PTO in obtaining its trademark registrations.
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`STATEMENT OF DISPUTED FACTS
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`The following facts are in dispute in this case:
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`1.
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`Herbaceuticals does not have standing to petition for cancellation of XEL’s
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`trademarks because Herbaceuticals’ trademarks are invalid because they are generic.
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`2.
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`Herbaceuticals does not have standing to petition for cancellation of XEL’s
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`trademarks because the products described in Herbaceuticals’ trademarks are not
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`related to the products described in XEL’s trademarks.
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`3.
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`The statements made by XEL in its Statements of Use are not false because the
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`“Declaration” portion of the Statements of Use, which is the sworn portion of the
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`statement, asserts that the trademark is used on “the goods/services” as opposed to “all
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`goods and/or services.” The separate language implies a separate meaning.
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`Therefore, XEL only swore that the trademarks were being used on the goods, which
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`was an accurate statement. See, Declaration of Peter M. de Jonge (hereinafter “de
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`Jonge Declaration”), paragraphs 2-4.
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`4.
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`XEL did not intend to obtain a trademark registration, or any trademark rights, to
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`which it was not entitled. See, de Jonge Declaration, paragraph 5.
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`

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`5.
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`The Examining Attorney for the PTO had determined that XEL was entitled to a
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`trademark registration that included the complete identification of goods for each
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`respective application and XEL did not commit fraud in obtaining that approval. See,
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`de Jonge Declaration, paragraph 6.
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`6.
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`Any false statements in XEL’s Statements of Use are not material to the registration of
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`the trademarks with respect to the goods in use.
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`7.
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`Herbaceuticals has delayed in asserting its trademark rights, and XEL prejudicially
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`relied on Herbaceuticals’ acquiescence in XEL’s trademark use. Accordingly,
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`Herbaceuticals is estopped from obtaining a cancellation of XEL’s trademarks based
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`on laches.
`
`ARGUMENT
`
`To prevail in its SJ Motion, Herbaceuticals must establish that there is no genuine
`
`issue as to any material fact, and that Herbaceuticals is entitled to judgment as a matter of law.
`
`See, Celotex Corp. v. Catrett, 477 U.S. 317 (1986). A factual dispute is genuine if sufficient
`
`evidence is presented such that a reasonable fact finder could decide the question in favor of
`
`the non-moving party. See, Opryland USA Inc. v. The Great American Music Show Inc., 23
`
`USPQ2d 1471, 1472 (Fed.Cir. 1992) (requiring just sufficient evidence to show an
`
`evidentiary conflict as to the material fact). Furthermore, XEL must be given the benefit of
`
`all reasonable doubt as to whether genuine issues of material fact exist, and all inferences
`
`from the undisputed facts must be viewed in the light most favorable to XEL.
`
`Id.
`
`Herbaceuticals has not met its burden of demonstrating an absence of any genuine
`
`issue of material fact, nor that it is entitled to judgment as a matter of law. See, Copelands’
`
`

`
`Enterprises Inc. v. CNVInc., 20 USPQ2d 1295, 1298-99 (Fed.Cir. 1991) (conclusory
`
`statements insufficient).
`
`I.
`
`HERBACEUTICALS HAS NO STANDING TO PETITION CANCELLATION
`OF XEL’S TRADEMARKS BECAUSE HERBACEUTICALS’ TRADEMARKS
`ARE GENERIC
`
`To obtain cancellation of XEL’S trademarks, Herbaceuticals must first demonstrate
`
`that it has standing to petition for cancellation. See, Cunningham v. Laser Golf Corp, 222
`
`F.3d 943, 945 (Fed.Cir. 2000). While there is a broad requirement that Herbaceuticals believe
`
`it would suffer some damage from XEL’S trademarks, Herbaceuticals must also meet two
`
`judicially—created requirements: a real interest in the proceedings and a reasonable basis for its
`
`belief of damage. See, Ritchie v. Simpson, 170 F.3d 1092, 1095 (Fed.Cir. 1999).
`
`As the basis for its assertion of standing, Herbaceuticals cites its trademark
`
`registrations, U.S. Registration Nos. 2,585,974 and 2,822,094. This makes the validity of
`
`Herbaceuticals’ trademarks a material issue, because without valid trademarks, Herbaceuticals
`
`would not have standing to petition cancellation. A genuine issue as to the material fact of the
`
`validity of Herbaceuticals’ trademarks, and therefore its standing, currently exists.
`
`In Registrant/Counter Petitioner’s Answer and Counter Petition to Cancel, filed with
`
`this Board on or about March 16, 2006, and incorporated by this reference, XEL has asserted
`
`that Herbaceuticals’ trademarks are generic as an affirmative defense, and counterclaimed
`
`Herbaceuticals’ trademarks are generic and should be canceled. XEL’S counterclaim is made
`
`pursuant to 15 U.S.C. §1064; a party can petition to cancel a registration at any time if the
`
`subject mark “becomes the generic name of the goods or services.”
`
`Determining whether a mark is generic involves a two step inquiry: (1) identify the
`
`genus of the goods or services at issue; and (2) determine if the registered term is understood
`
`

`
`by the relevant public to refer to that genus of goods or services. See, H. Marvin Ginn Corp.
`
`v. International Association ofFire Chiefs, Inc., 782 F.2d 987 (Fed.Cir. 1986). Evidence of
`
`the relevant public’s understanding of a term may come from a variety of sources, including
`
`without limitation, consumer surveys, magazines, dictionaries, and other publications. See, In
`
`re Merrill, Lynch, Pierce, Fenner and Smith, Inc., 828 F.2d 1567 (Fed.Cir. 1987).
`
`XEL has provided substantial evidence during discovery regarding the fact that the
`
`term “herbaceutical” is understood by the public to refer to a genus of products. See, de Jonge
`
`Declaration, Exhibit A. As an example of disputed facts regarding whether “herbaceutical” is
`
`generic, the documents Bates numbered XEL00l609 and XEL001613 seems to indicate that a
`
`company called Phytopharm originally developed the term “herbaceuticals” to describe
`
`Phytopharm’s approach of providing natural medicine products. Id. However,
`
`Herbaceuticals claims its President, Tricia Grose, created the name “herbaceuticals.” See, de
`
`Jonge Declaration, Exhibit B, Response to Interrogatory No. 8.
`
`Herbaceuticals’ SJ Motion does not mention or address XEL’s assertion or evidence
`
`that its trademarks are generic. Therefore, Herbaceuticals’ trademarks must be inferred to be
`
`generic, and Herbaceuticals’ SJ Motion denied.
`
`II.
`
`XEL DID NOT COMMIT FRAUD IN OBTAINING ITS TRADEMARKS
`
`To establish that XEL procured its trademarks by fraud, I-Ierbaceuticals must establish
`
`that XEL knowingly made false, material representations of fact in connection with its
`
`applications. See, Torres v. Cantine Torresella S.r.l., 808 F.2d 46, 47-48 (Fed.Cir. 1986).
`
`Herbaceuticals’ allegation of fraud must be proven “to the hilt” by clear and convincing
`
`evidence. See, Smith International, Inc. v. Olin Corporation, 209 USPQIO33, 1043-44
`
`(TTAB 1981).
`
`

`
`XEL did not commit fraud because XEL did not make a false statement, did not have
`
`the requisite intent for fraud, and any statements if they be deemed false made by XEL were
`
`not material to the registration of its trademarks.
`
`A.
`
`XEL DID NOT MAKE FALSE STATEMENTS
`
`XEL’s trademarks where initially filed as “intent-to-use” trademark applications, and
`
`XEL intended to use its trademarks on all those goods. The statements made by XEL in its
`
`Statements of Use are not false because the “Declaration” portion of the Statements of Use,
`
`which is the sworn portion of the statement, asserts that the trademark is used on “the
`
`goods/services” as opposed to “all goods and/or services.” The separate language implies a
`
`separate meaning. The former was understood to mean within the scope of the goods so
`
`identified, but not necessarily each and every one of the goods identified. Therefore, XEL
`
`only swore that the trademarks were being used within the scope of those goods, which was
`
`an accurate statement. See, de Jonge Declaration, paragraphs 2-4.
`
`XEL knew that it was entitled to certain trademark rights, but did not make any
`
`statement intending to obtain trademark rights, or a trademark registration, to which it was not
`
`entitled. Id., at paragraph 5.
`
`Even if this understanding of the language in the Statements of Use was mistaken, it is
`
`not fraud because the declarant believed “on information and belief’ that XEL was using its
`
`trademark on all the goods identified. The “Declaration” portion of the Statements of Use
`
`contains the language “on information and belief,” allowing that certain statements can be
`
`made “on information and belief ’ and do not require actual knowledge. Simply put, declarant
`
`did not have actual knowledge that the mark was not used on each and every one of the goods
`
`identified. As the attorney of record for XEL, the Declaration was signed on information and
`
`

`
`belief that the mark was used on each and every one of the goods identified. Id., at
`
`paragraphs 7-9.
`
`B.
`
`XEL DID NOT INTEND TO OBTAIN REGISTRATION OF A
`
`TRADEMARK TO WHICH IT WAS NOT ENTITLED
`
`Generally, the factual question of intent is particularly unsuited to disposition in
`
`motions for summary judgment. See, Copelands ’, 20 USPQ2d at 1298-99. One court
`
`determined that facts analogous to those in this case did not warrant a finding of fraudulent
`
`intent. “The undisputed evidence thus shows that [Registrant’s] statement of use contained
`
`statements known to be false by the President of [Registrant], who attested to its truth. Even
`
`with this determination, however, this Court cannot conclude that [the President] did so with
`
`the necessary fraudulent intent, that he made a ‘conscious effort to obtain for his business a
`
`registration to which he knew it was not entitled.’” Horizon Healthcare Servs. v. Allied Nat ’l,
`
`lnc., 2006 U.S. Dist. LEXIS 5440, *26 (D.N.J. Feb. 10, 2006), citing, Metro Traffic Control
`
`v. Shadow Network, 104 F.3d 336, 340 (Fed.Cir. 1997).
`
`It has already been noted that an allegation of fraud must be proven “to the hilt” by
`
`clear and convincing evidence. See, Smith International, 209 USPQ at 1043-44. “In contrast,
`
`a defendant’s intent is not an element of a claim that a mark was not used on certain of the
`
`identified goods or services, nor is an enhanced standard of proof required.” See, Grand
`
`Canyon West Ranch, LLC v. Hualapai Tribe, 2006 TTAB LEXIS 82, *3-4, 78 USPQ2d 1696
`
`(TTAB Mar. 17, 2006) (holding “that as long as the mark was used on some of the identified
`
`goods or services as of the filing of the application, the application is not void in its entirety”).
`
`The Examining Attorney for the PTO had determined that XEL was entitled to a
`
`trademark registration that included the complete identification of goods for each respective
`
`

`
`application. The fact that XEL obtained and consolidated this approval does not demonstrate
`
`the requisite intent to commit fraud.
`
`C.
`
`ANY FALSE STATEMENTS IN XEL’S STATEMENTS OF USE ARE
`
`NOT MATERIAL TO REGISTRATION OF THE TRADEMARK WITH
`
`RESPECT TO THE OTHER GOODS IN USE
`
`A statement in an application or representation to the PTO may be “false” without
`
`being “fraudulent.” See, Morehouse Mfg. Corp. v. J. Strickland & Co., 407 F.2d 881 (CCPA
`
`1969).
`
`In the context of trademark law, the correct standard for materiality is that a material
`
`misrepresentation arises only if the registration should not have issued if the truth were known
`
`to the examiner. Pennwalt Corp. v. Sentry Chemical Co., 219 USPQ 542 (TTAB 1983)
`
`(finding full disclosure would not have resulted in a proper refusal of registration by the
`
`Trademark Examiner). Even if a statement made by XEL in its trademark applications was
`
`deemed to be false, fraud would not be established because it would not be a material
`
`misrepresentation.
`
`Numerous cases exist where an overly broad description of goods, or non-use on
`
`some, but not all, of the identified goods and/or services resulted in amendment of the
`
`identified goods, or a partial cancellation of the subject trademark with respect to those goods
`
`not used. See, e. g., Rogers Corp. v. Fields Plastics & Chemicals, lnc., 176 USPQ 280 (TTAB
`
`1972), aff’d, 181 USPQ 169 (CCPA 1974) (finding that the applicant had not committed fraud
`
`even though the identification of goods included some proposed, rather than actual, uses of
`
`the mark); see also, Edison Bros. Stores, Inc. v. Cosmair, Inc., 2 USPQ2d 1013 (SDNY 1987)
`
`(finding claim of use of mark on a variety of clothing items, where use was in fact only on
`
`pants, was not fraud justifying cancellation; the erroneous statement was made honestly and
`
`was not material to the registration); see also, Alcan Aluminum Corp. v. Alcar Metals, Inc.,
`
`

`
`200 USPQ 742 (TTAB 1978) (finding no fraud from over—inclusive list of goods); see also,
`
`Space Base, Inc. v. Stadis Corp, 17 USPQ2d 1216 (TTAB 1990) (suggesting that fraud claim
`
`could be restated as claim for partial cancellation to limit and narrow overly broad
`
`identification of services in the registration). Accordingly, XEL’s non-use of its trademarks
`
`on certain identified goods should not amount to fraud, nor result in cancellation of the entire
`
`trademark.
`
`The Board in Grand Canyon West states it is not appropriate to treat an applicant’s
`
`non-use of its mark on some of the identified goods or services in the same manner as an
`
`applicant’s complete failure to make use of its mark on any of its identified goods or services,
`
`noting that “the Board has made a distinction in the remedies for fraud and for nonuse on
`
`some, but not all, of the identified goods and/or services.” See, Grand Canyon West Ranch,
`
`2006 TTAB LEXIS 82, *4-6, citing, Rogers C0rp., supra. This same case also notes that in
`
`Medina] Ltd. v. Neuro Vasx Inc., 67 USPQ2d 1205 (TTAB 2003) the Board found fraud, but
`
`also stated if the finding of fraud were overturned, the registration would have to be amended
`
`to delete the goods for which the mark was not used, “thus indicating that, in the absence of
`
`fraud, the registration would survive.” See, Grand Canyon West Ranch, 2006 TTAB LEXIS
`
`82, *4-5.
`
`In the present case, the alleged false statement relates to a non-use of some of the
`
`identified goods. Whether this false statement was made or not, XEL was still entitled to a
`
`registration. Since XEL was still entitled to a registration, the false statement cannot be
`
`material to the registration and no fraud can exist.
`
`

`
`D.
`
`THE PROPER REMEDY IS NOT CANCELLATION, BUT
`AMENDMENT OR PARTIAL CANCELLATION
`
`The proper remedy in this case is not cancellation of XEL’s trademarks in their
`
`entirety. The proper remedy would be amendment of the description of goods in XEL’s
`
`trademarks, or similarly partial cancellation to remove those goods on which XEL’s
`
`trademark is not used. The Board is especially equipped to accomplish this end.
`
`In Grand Canyon West, the Board holds “that as long as the mark was used on some
`
`of the identified goods or services as of the filing of the application, the application is not void
`
`in its entirety.” See, Grand Canyon West Ranch, 2006 TTAB LEXIS 82, *3. The reasons
`
`discussed in Grand Canyon West that provide the basis for this holding include: the
`
`distinction in remedies for fraud as compared to non-use, where fraud is characterized by no
`
`use of the subject mark on any of the goods or services, as compared to non-use characterized
`
`by use of the subject mark on some, but not all of the goods or services; and the recognition of
`
`the policy justification for amending the goods provided in part by the Trademark Law Treaty
`
`Implementation Act of 1998, Pub.L.No. 105-330, 112 Stat. 3064. Id., at *4—7. Specifically,
`
`Grand Canyon West notes that the policy justification provides support for its position that
`
`“an application should not be treated as void as long as the mark was used on some of the
`
`identified goods or services.” 1d., at *7.
`
`The Board is in a favorable position to amend or modify descriptions of goods based
`
`on market realities. The Board can make appropriate modifications, or not, accounting for the
`
`balance sought between the strict requirement that a mark be used on “all goods and/or
`
`services,” and the market reality that descriptions of goods run from vague and broad to more
`
`narrow, and are also intended to apply to related goods. See, e. g., Procter & Gamble v.
`
`Economics Laboratory, Inc., 175 USPQ 505 (TTAB 1972), modified, without op., 181 USPQ
`
`

`
`722 (CCPA 1974) (finding no fraud where registration for a mark identified products as
`
`“sudsing cleanser, cleanser and detergent,” and the mark was only used on a detergent).
`
`In the case currently before the Board, it does not seem equitable that Herbaceuticals
`
`can assert a claim of fraud when its own registrations include a description of goods as vague
`
`and overly broad as “distributorship” of “wellness products.” Herbaceuticals’ trademark Reg.
`
`No. 2,822,094 describes: “retail and wholesale distributorship services in the field of
`
`homeopathic preparations, cosmetics, dietary supplements and wellness products.” See,
`
`Rubinstein Dec., Exhibit 17.
`
`Based on the standard for determining fraud asserted by Herbaceuticals, XEL could
`
`allege that Herbaceuticals obtained its trademark Reg. No. 2,822,094 by fraud. Certainly
`
`Herbaceuticals is not using its trademarks on “all goods and/or services” related to “wellness
`
`products?” Therefore, it is just as reasonable for XEL to argue that Herbaceuticals has
`
`committed fraud by making a knowingly false, material statement of fact with regards to its
`
`trademark application.
`
`Application of the standard for determining fraud asserted by Herbaceuticals would
`
`open the floodgates of litigation for claims of fraud in trademark cases. Claims of fraud in
`
`trademark cases would become as prevalent as claims of inequitable conduct in patent cases.
`
`See, e. g., Burlington Indus. v. Dayco Corp., 849 F.2d 1418, 1422 (Fed.Cir. 1988) (stating that
`
`“the habit of charging inequitable conduct in almost every major patent case has become an
`
`absolute plague”).
`
`' The Board has addressed a similar issue with respect to the description of goods, “computer programs.” This
`description was determined to be so broad as to be devoid of any information regarding what computer programs
`were actually marketed. See, In re SunGuard Development Corporation, 1999 TTAB LEXIS 735, *9—l0 (TTAB
`June 9, 1999).
`
`-10-
`
`

`
`E.
`
`CASE LAW CITED BY HERBACEUTICALS IS LEGALLY AND
`
`FACTUALLY DISTINGUISHABLE
`
`Herbaceuticals relies heavily on Medinol Ltd v. Neuro Vasx 1nc., supra, for the
`
`proposition that XEL committed fraud in procuring its trademarks and that that fraud should
`
`result in cancellation of each trademark in its entirety.2 It has already been established that
`
`the Board in Grand Canyon West has moved away from treating fraud, described as no use of
`
`a mark with respect to identified goods, in the same manner as non-use, described as use of a
`
`mark on some, but not all of the identified goods. See, Grand Canyon West Ranch, 2006
`
`TTAB LEXIS 82, *4-6, and similar cases, supra.
`
`Medinol is also factually distinguishable from the present cancellation. Respondent in
`
`Medinol did not support any claims with affidavits or other evidence. See, Medinol, 67
`
`USPQ2d at fnl0. XEL has provided evidence supporting XEL’S assertion that
`
`Herbaceuticals’ trademarks are generic, as well as evidence that statements made by XEL in
`
`its trademark applications were not false.
`
`III.
`
`HERBACEUTICALS IS ESTOPPED FROM OBTAINING CANCELLATION
`
`OF XEL’S TRADEMARKS BASED ON LACHES
`
`When used as a defense to cancellation, laches must be based on a product of
`
`Herbaceuticals’ delay and the resulting prejudice to XEL. The Federal Circuit has established
`
`that mere delay in asserting trademark related rights does not necessarily result in the changed
`
`conditions that support a finding of laches. There must also be some detriment due to the
`
`delay. See, Bridgestone/Firestone Research, Inc. v. Automobile Club De L ’0uest De La
`
`France, 245 F.3d 1359 (Fed.Cir. 2001). A five-year delay coupled with prejudicial reliance
`
`has been found to constitute laches. See, Turner v. Hops Grill & Bar, Inc., 52 USPQ2d 1310
`
`2 Herbaceuticals also relies on J.E.M International, Inc. v. Happy Rompers Creations Corp., 2005 WL 548069,
`Cancellation No. 92043073 (TTAB Feb. 10, 2005), however, the disposition in this cancellation is not citable as
`precedent of the TTAB.
`
`-11-
`
`

`
`(TTAB 1999) (finding prejudicial reliance based on a substantial expansion of restaurant
`
`outlets over the five-year period).
`
`Herbaceuticals first contacted XEL regarding XEL’s use of its trademarks on or about
`
`December 18, 2000. See, de Jonge Declaration, Exhibit C. Herbaceuticals filed its Petition
`
`for Cancellation on or about November 8, 2005. While Herbaceuticals did contact XEL
`
`sporadically between the initial contact and filing its Petition for Cancellation, the prejudicial
`
`reliance is established by the acquiescence of Herbaceuticals to XEL’s trademarks being
`
`published for opposition and registered without Herbaceuticals objection, and by the growth
`
`in XEL business, and product line, during the delay period.
`
`For example, XEL trademark Reg. No. 2,948,359 was published for opposition on
`
`April 23, 2002, and did not register until May 10, 2005. See, Rubinstein Dec., Exhibit 1.
`
`Similarly, XEL trademark Reg. No. 2,948,354 was published for opposition on January 1,
`
`2002, and did not register until May 10, 2005. See, Rubinstein Dec., Exhibit 2.
`
`Herbaceuticals did not file any opposition proceedings. Similar acquiescence is demonstrated
`
`by Herbaceuticals with regards to XEL trademark Reg. Nos. 2,860,543 and 2,845,260 and
`
`2,970,979 and 2,970,981. See, Rubinstein Dec., Exhibits 6, 7, 10 and 11, respectively,
`
`showing analogous dates for publication of opposition and registration, which Herbaceuticals
`
`did not oppose.
`
`Moreover, XEL was continuing to expand its product line and grow its business while
`
`Herbaceuticals was essentially silent. The prejudice to XEL would have been greatly
`
`diminished if Herbaceuticals would have asserted its trademark rights earlier. The period of
`
`delay, coupled with the detriment to XEL based on Herbaceuticals’ acquiescence, constitutes
`
`laches and precludes Herbaceuticals from canceling XEL’s trademarks.
`
`-12-
`
`

`
`CONCLUSION
`
`Herbaceuticals’ SJ Motion should be denied because Herbaceuticals has failed to
`
`establish standing to petition cancellation of XEL’s trademarks, and because Herbaceuticals
`
`has failed to establish any of the necessary elements of its fraud claim.
`
`DATED this 19th day of January, 2007.
`
`Respectfully submitted,
`
`A«¢gé:ul=_‘~ll
`
`Peter M. de Jonge
`Gordon K. Hill
`
`Attorneys for Registrant/ Counter Petitioner
`
`THORPE NORTH & WESTERN, LLP
`8180 South 700 East Suite 350
`
`Sandy, Utah 84070
`
`-13-
`
`

`
`CERTIFICATE OF SERVICE
`
`The undersigned hereby certifies that a true and correct copy of the foregoing
`
`Memorandum Opposing Petitioner/Counter-Registrant’s Motion for Summary Judgment was
`
`served upon the Petitioner/Counter-Registrant at the following by the methods indicated
`
`below:
`
`Karin Segall
`Abigail Rubinstein
`DARBY & DARBY
`P.O. Box 5257
`
`New York, New York 10150-52557
`
`Dated',_%m, M 35 290:]
`
`Hand Delivery
`2 United States Mail
`Federal Express
`Fax Transmission
`
`
`
`-14-
`
`

`
`TRADEMARK
`DOCKET NO. 25817
`
`Peter M. de Jonge
`Gordon K. Hill
`
`THORPE NORTH & WESTERN, LLP
`
`8180 South 700 East, Suite 350
`
`Sandy, Utah 84070
`Telephone: (801) 566-6633
`Facsimile: (801)566-0750
`
`Attorneys for XEL Herbaceuticals, Inc.
`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`TRADEMARK TRIAL AND APPEAL BOARD
`
`
`HERBACEUTICALS, INC.,
`
`Petitioner,
`
`V.
`
`Cancellation No. 92/045,172
`
`XEL HERBACEUTICALS, INC.,
`
`DECLARATION OF
`PETER M. DE JONGE
`
`Registrant.
`
`XEL HERBACEUTICALS, lNC.,
`
`Counter Petitioner,
`
`v.
`
`HERBACEUTICALS, INC.,
`
`Counter Registrant,
`
`
`DECLARATION OF PETER M. DE JONGE
`
`PURSUANT TO 37 C.F.R. §2.20
`
`

`
`I, Peter M. de Jonge, declare:
`
`I am a partner associated with the firm of Thorpe North & Western, representing
`
`Registrant/Counter-Petitioner, XEL Herbaceuticals, Inc. (hereinafter “XEL”) in
`
`connection with Cancellation No. 92,045,172.
`
`I have personal knowledge of the
`
`material facts stated herein and I make and submit this Declaration in support of
`
`XEL’s Memorandum Opposing Petitioner/Counter—Registrant’s Motion for Summary
`
`Judgment.
`
`XEL’s trademarks where initially filed as “intent-to-use” trademark applications, and
`
`XEL intended to use its trademarks on all those goods.
`
`The statements made by XEL in its Statements of Use are not false because the
`
`“Declaration” portion of the Statements of Use, which is the sworn portion of the
`
`statement, asserts that the trademark is used on “the goods/services” as opposed to “all
`
`goods and/or services.”
`
`The separate language implies a separate meaning. The former was understood to
`
`mean within the scope of the goods so identified, but not necessarily each and every
`
`one of the goods identified. Therefore, XEL only swore that the trademarks were
`
`being used within the scope of those goods, which was an accurate statement.
`
`XEL knew that it was entitled to certain trademark rights, but did not make any
`
`statement intending to obtain trademark rights, or a trademark registration, to which it
`
`was not entitled.
`
`The Examining Attorney for the PTO had determined that XEL was entitled to a
`
`trademark registration that included the complete identification of goods for each
`
`respective application and XEL did not commit fraud in obtaining that approval.
`
`

`
`If
`
`Even if my understanding of the language in the Declaration was mistaken, it is not
`
`fraud because I believed “on informati