US: Petition to cancel on the ground of abandonment fails despite the lack of traditional use

Evidence of non-use of a mark for three consecutive years constitutes a prima facie showing of abandonment, triggering a rebuttable presumption that a mark was abandoned without intent to resume use. The rebuttable presumption then shifts to the party contesting an abandonment claim to submit evidence of use during the alleged period of non-use in situations where its registration basis is either Section 1(a) or 44(e) of the Trademark Act. However, in the circumstance of a ‘never-used’ mark registered on the basis of Trademark Act Section 66(a), an intent to begin use is acceptable evidence to rebut the presumption of abandonment. This distinction played a key role in a decision recently rendered by the Trademark Trial and Appeal Board (TTAB) in Wirecard AG v Striatum Ventures B.V. 

In 2018, Wirecard filed a petition to cancel a registration owned by Striatum Ventures (Striatum) for the stylised mark “Zupr” issued on October 20 2015 under the Trademark Act Section 66(a).  The petition to cancel alleged that Striatum “has either never used the [mark] in commerce, or completely ceased using the mark... including for a non-use period of at least three (3) consecutive years,” and that “[Striatum] had and has no intent to resume use.” The parties submitted a stipulation that included undisputed facts, an agreement to file testimony and documentary evidence together with their main briefs in lieu of trial. 

Based on the evidence, the TTAB found Wirecard established a prima facie case that Striatum “abandoned the ZUPR mark through nonuse from October 20 2015 through the present,” triggering  a rebuttable presumption that the “Zupr” mark was never used by Striatum and had been abandoned without intent to resume use. In support of its position, Striatum primarily relied on a declaration averring that Striatum continuously sought strategic assistance from a public relations agency with strong ties to the United States market since 2016 and an online marketing specialist since 2017, as well as a YouTube video purportedly demonstrating use. Wirecard contended that Striatum’s activities failed to show any consistent or sustained effort to begin use in commerce. 

The TTAB disagreed with Wirecard, holding that Striatum’s activities “are the type that would be undertaken by a reasonable business with a bona fide intent to use the mark in United States commerce,” pointing out that, following registration, Striatum entered into a contract for marketing strategy advice, demonstrated its products to a public relations firm and reached an oral agreement with a retailer to use “Zupr” brand goods and services in the United States in 2019. The TTAB added that the timing of the proceeding was relevant, because the 2019 launch “had been announced to prospective participants before the petition to cancel was filed” and “if the launch had taken place, even though outside the three year nonuse period, it also would support the testimony regarding intent to commence use.” 

Accordingly, the TTAB denied the petition to cancel, finding that the record demonstrated Striatum had the requisite intent to commence use during the three year statutory period of non-use.