Breaking Down the Chateau Grand Traverse v. Grand Traverse Distillery Trademark Case

As previously posted "Chateau Grand Traverse Sues Grand Traverse Distillery Over Name" we have two local companies fighting over trademark rights to use "Grand Traverse" as part of their brand. 

Grand Traverse Distillery sells Vodka.   Chateau Grand Traverse sells wine.  Of course, the question raised is whether the geographic indicator for Grand Traverse, the county in which both companies operate, is capable of trademark protection in the first instance.   This is not the first time the issue of geographic descriptiveness has come to the forefront locally, as two wineries in Leelanau County, Michigan fought over the use of "Leelenau" in their wine branding last year which culminated in a three judge appellate panel of the sixth circuit court of appeals ruling in favor of Chateau de Leelanau Vineyard and Winery on trademark
infringement claims brought by Leelanau Wine Cellars, Ltd. In that case, the court of appeals ruled that there was unlikely to be consumer confusion (and mysteriously overlooking the more obvious problem of geographic descriptiveness).

Grand Traverse Distillery filed for trademark registration on July 27, 2005The initial refusal by the examining attorney is exactly what would be expected on a trademark which is both descriptive and includes a geographic indicator:

Registration Refused – Geographically Descriptive Mark
Registration is refused because the mark is primarily geographically descriptive of the origin of applicant’s goods.  Trademark Act Section 2(e)(2), 15 U.S.C. §1052(e)(2); TMEP §§1210.01(a) and 1210.04 et seq.

A three-part test is applied to determine whether a mark is primarily geographically descriptive of the goods and/or services within the meaning of Trademark Act Section 2(e)(2):
(1) the primary significance of the mark must be geographic, i.e., the mark names a particular geographic place or location;
(2)  purchasers would be likely to make a goods-place or services-place association, i.e., purchasers are likely to believe the goods or services originate in the geographic location identified in the mark; and
(3) the goods and/or services originate in the place identified in the mark.

TMEP §1210.01(a); See In re MCO Properties, Inc., 38 USPQ2d 1154 (TTAB 1995); In re California Pizza Kitchen, 10 USPQ2d 1704 (TTAB 1989). The primary significance of the wording “GRAND TRAVERSE” in the mark is the name of a geographic location.

It is unclear what the possible thinking could have been to file, then abandon a trademark application like this.  There are arguments to convince the examining attorney that the mark is something more than geographically descriptive.  The only response provided feebly indicated: "The examining attorney is respectfully requested to reconsider the descriptiveness decision, in light of the fact that "GRAND TRAVERSE DISTILLERY" is a standard character mark and creates a distinct and separate commercial impression from a regional designation alone."  This is hardly the kind of argument which gives an applicant a fighting chance at the examination process level.  Even more puzzling was the quick abandonment of the trademark on March 28, 2007 when counsel reversed direction and actually agreed that the mark was geographically descriptive:
"Applicant hereby withdraws the referenced application. Applicant
concurs that "GRAND TRAVERSE" is a geographically descriptive mark and
describes the origin of Applicant’s goods."  This raises the obvious question of why the mark was filed in the first place.

The trademark for Grand Traverse Distillery was refiled before the first effort was even abandon on February 20, 2007 as a "Design plus Word" – or logo mark although given the previous admission of geographic descriptiveness likely only provided real protection for the stylized design of the logo. This mark made it to publication where it was opposed by Chateau Grand Traverse based on its January 11, 2007 filing for "GRAND TRAVERSE SELECT" with a first use date of 10/31/1996. Interestingly, the examining attorney made registrant disclaim exclusive use of "Select" but not the geographic descriptor "Grand Traverse". Inexplicably, the examining attorney failed to require further information for registrant to establish the quired distinctiveness necessary to achieve secondary meaning and thus 2(f) protection.   The geographically descriptive problem could have caused the examining attorney to refuse registration (or which may have been overcome by establishing secondary meaning).

Chateau Grand Traverse filed an opposition to Grand Traverse Distillery’s mark sending it into a opposition proceeding. Grand Traverse Distillery filed its own claim arguing that the registered trademark "GRAND TRAVERSE SELECT" should be canceled because "Grand Traverse" could not indicate "exclusive use" given all the other companies which use the words in their brand names and that "Grand Traverse" was geographically descriptive and had not acquired distinctiveness necessary to qualify for 2(f) protection.

Chateau Grand Traverse answered the counterclaim by noting that its mark had been in use for more than five years, thus acquiring distinctiveness in the market. However, the more interesting problem for Grand Traverse Distillery is that it alleged under oath to the Trademark Office on two trademark filings that "Grand Traverse" was worthy of trademark protection and thus estopped from arguing the geographically descriptive defense.  This may be the biggest problem which Grand Traverse Distillery faces since its prior filings were under oath, and subject to the laws of perjury. By all appearances, they are now changing their position on the questionable grounds of "if we can’t have it, they can’t have it either."

This case illustrates an important point.  Be careful before you file trademark registrations with the Trademark Office. You need to know who the opposer’s might be before you file.  Even more important, do a trademark search before you select a name for your product or company.  In this case, the name of the vodka in question is "True North Vodka" which is much more important than the company name. There was little likelihood of success in filing the word mark "Grand Traverse Distillery" in the first instance, in fact none.  Having decided to file that mark, and the follow up image mark which included the words "Grand Traverse Distillery" likely triggered what will no doubt be a costly and distracting arbitration which will drain the company of time and resources. The company should have considered filing a simple image/design mark which would not likely have triggered any opposition and achieved as much protection as would be possible given the previous admission of geographic descriptiveness.      

It is unclear whether federal court litigation has been filed or whether this matter will simply continue to proceed through the opposition process at the USPTO. It is going to be very difficult for Chateau Grand Traverse to show a likelihood of confusion, just as it was in the Leelanau Wine Cellars case.