Brewing Likelihood of Confusion: A Look At Coexistence Agreements

By: Erica Paige Fang

When two trademark owners have developed rights to identical or similar marks, they might enter into a coexistence agreement in order to resolve a potential trademark dispute.  The agreement must clearly state in detail the rights of the respective parties and how confusion in the marketplace will be avoided.  Typically, the goods and services are unrelated, are sold in different geographic areas, or utilize different trade channels. 

A consent agreement is a type of coexistence agreement that may be entered into the record of a trademark prosecution in order to obtain registration.  The consent agreement usually limits the rights of the party seeking consent, but will not thoroughly address long-term coexistence.   A consent agreement is a declaration that there will be no confusion.  Courts will consider this evidence there is no likelihood of confusion because the parties entering into the agreement are those who would most greatly be affected by potential consumer confusion.  It is important to know a court can reject a coexistence agreement if it fails to provide sufficient detail regarding avoidance of confusion and if they believe consumer confusion is unavoidable.

In re Bay State Brewing Company, Inc. (TTAB 2016) the Board determined the consent agreement was not sufficient to avoid confusion and affirmed the 2(d) refusal on likelihood of confusion.  As discussed above, a consent agreement usually carries great weight in the likelihood of confusion analysis.  The consent agreement relates to the market interface between the parties, and is number 10 of the du Pont factors. Here, Bay State Brewing Company (“Applicant”) filed to register TIME TRAVELER BLONDE (BLONDE disclaimed) as a standard word mark for beer, but was refused based on prior registered standard word mark TIME TRAVELER for beer, ale and lager.   The consent agreement limited the applicant to the geographic area of New York State and the New England area, whereas there were no geographic limitations on the Registrant.  The board found the restriction on use only limiting one party effectively allows for simultaneous use by both parties in the same regions, here New York State and the New England area.   Ultimately, the Board determined the restrictions set forth in the parties’ consent agreement would not eliminate confusion in the marketplace.  Further, the Board held the mark TIME TRAVELER for beer, ale and lager is an arbitrary mark entitled to a broad scope of protection. 

In re Four Seasons Hotels, Ltd., 987 F2.d (Fed. Cir. 1993), the Federal Circuit found no likelihood of confusion between FOUR SEASONS BILTMORE and THE BILTMORE LOS ANGELES, stating the parties’ coexistence agreement passed the scrutiny because the marks were sufficiently different, the services were not identical and the marks had coexisted in the marketplace for years without confusion.  The Board evaluating Bay State Brewing Company distinguished from this case because the goods, beer, were the identical, and the marks were virtually identical minus the disclaimed and descriptive term for beer, BLONDE. 

Parties should weigh future conflicts when considering a coexistence agreement.  Some important considerations include:  1) term of the agreement; 2) rights to license or assign the mark; and 3) potential expansion, particularly into new geographic areas or into new goods and services.  Further, a party should consider whether their mark is arbitrary, or fanciful in relating to the goods or services, allowing for a broader scope of protection.   Allowing other coexistence could dilute the mark and weaken the strength of protection.  However, in the right circumstances, a clear coexistence agreement detailing how the parties will avoid likelihood of confusion in the marketplace can help avoid any brewing of confusion, as was the case for the parties in the Four Seasons Hotel.  

Disclaimer: This article discusses general legal issues and developments. Such materials are for informational purposes only and may not reflect the most current law in your jurisdiction. These informational materials are not intended, and should not be taken, as legal advice on any particular set of facts or circumstances. No reader should act or refrain from acting on the basis of any information presented herein without seeking the advice of counsel in the relevant jurisdiction.  Bend Law Group, PC expressly disclaims all liability in respect of any actions taken or not taken based on any contents of this article.