Asian and Western Classics B.V.

                                UNITED STATES PATENT AND TRADEMARK OFFICE
                                Trademark Trial and Appeal Board
                                P.O. Box 1451
 THIS OPINION IS                Alexandria, VA 22313-1451
 A PRECEDENT OF
   THE T.T.A.B.

     Goodman                  Mailed:     October 22, 2009

                              Cancellation No. 92048821

                              Asian and Western Classics
                              B.V.

                                           v.

                              Lynne Selkow

Before Walters, Zervas and Wellington, Administrative
Trademark Judges.

By the Board:

     This case now comes up on petitioner’s motion, filed

May 15, 2009, for summary judgment on its fraud claim as set

forth in its amended petition to cancel.    Specifically,

petitioner’s motion argues that there is no genuine issue

that “there was no use of the mark on some of the goods

[bracelets] set forth in the registration” when respondent

filed her Section 8 and 15 declaration.    The motion is fully

briefed.

     A decision on summary judgment necessarily requires a

review of the operative pleading in this case, filed on July

17, 2008 and accepted by the Board on December 22, 2008.     In

view of the recent decision of In re Bose Corp., 580 F.3d
Cancellation No. 92048821

1240, 

91 USPQ2d 1938

 (Fed. Cir. 2009), we find the fraud

claim insufficiently pleaded.1

      In petitioning to cancel on the ground of fraud, a

petitioner must allege the elements of fraud with

particularity in accordance with Fed. R. Civ. P. 9(b), made

applicable to Board proceedings by Trademark Rule 2.116(a).

Under Rule 9(b), together with Fed. R. Civ. P. 11 and USPTO

Rule 11.18, “the pleadings [must] contain explicit rather

than implied expression of the circumstances constituting

fraud.”    King Automotive, Inc. v. Speedy Muffler King, Inc.,

667 F.2d 1008

, 

212 USPQ 801, 803

 (CCPA 1981).       See also

Wright & Miller, Federal Practice and Procedure:        5A § 1296


1
  Petitioner alleges the following with regard to the fraud
claim:

    3. Petitioner is informed and believes that Selkow did not have
       bona fide use in commerce of the KL Design Mark at either
       the time the application for registration was filed or the
       date of the registration.

    4. Petitioner is informed and believes that despite not having
       any bona fide use of the mark in commerce, Selkow submitted
       false statements to the trademark office attesting to such
       use when she filed her application for registration. Selkow
       knew or should have known that the statements were false,
       and thus the registration was obtained fraudulently and
       should be cancelled.

    5. Petitioner is also informed and believes that at the time
       Selkow filed her Declaration under Section 8&15, she did not
       have bona fide use of the KL Design Mark in commerce.

    6. Petitioner is informed and believes that despite not having
       any bona fide use of the mark in commerce, Selkow submitted
       false statements to the trademark office attesting to such
       use when she filed her Declaration under Sections 8&15.
       Selkow knew or should have known that the statements were
       false, and thus, the Declaration was submitted fraudulently,
       and the registration should be cancelled.


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Cancellation No. 92048821

n. 11 (2004) (citing cases that discuss purposes of the Rule

9(b) heightened pleading standard to include providing

notice, weeding out baseless claims, preventing fishing

expeditions and fraud actions in which all facts are learned

after discovery, and serving the goals of Rule 11).

     Pleadings of fraud made "on information and belief,"

when there is no allegation of “specific facts upon which

the belief is reasonably based” are insufficient.     Exergen

Corp. v. Wal-Mart Stores Inc., 

91 USPQ2d 1656, 1670

 (Fed.

Cir. 2009) and cases cited therein (discussing when pleading

on information and belief under Fed. R. Civ. P. 9(b) is

permitted); see also In Re Bose Corp., 

91 USPQ2d at 1938

.

Additionally, under USPTO Rule 11.18, the factual basis for

a pleading requires either that the pleader know of facts

that support the pleading or that evidence showing the

factual basis is “likely” to be obtained after a reasonable

opportunity for discovery or investigation.   Allegations

based solely on information and belief raise only the mere

possibility that such evidence may be uncovered and do not

constitute pleading of fraud with particularity.    Thus, to

satisfy Rule 9(b), any allegations based on “information and

belief” must be accompanied by a statement of facts upon

which the belief is founded.   See Exergen Corp., 

91 USPQ2d at 1670

 n.7, citing Kowal v. MCI Commc'n Corp., 

16 F.3d 1271

, 1279 n.3 (D.C. Cir. 1994) “(‘[P]leadings on



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Cancellation No. 92048821

information and belief [under Rule 9(b)] require an

allegation that the necessary information lies within the

defendant's control, and … such allegations must also be

accompanied by a statement of the facts upon which the

allegations are based’).”

     In this case, petitioner’s allegations in Paragraphs 4

and 6 of the amended petition to cancel regarding

respondent’s alleged false statements to the Office are

based solely upon information and belief.      These allegations

fail to meet the Fed. R. Civ. P. 9(b) requirements as they

are unsupported by any statement of facts providing the

information upon which petitioner relies or the belief upon

which the allegation is founded (i.e., known information

giving rise to petitioner’s stated belief, or a statement

regarding evidence that is likely to be discovered that

would support a claim of fraud).2     Media Online Inc. v. El

Clasificado Inc., 

88 USPQ2d 1285

, 1287 (TTAB 2008) (finding

the proposed amended pleading insufficient in part under

Fed. R. Civ. P. 9(b) because the false statements that

purportedly induced the Office to allow registration were

not set forth with particularity).     See also Wright &




2
  Although paragraphs 3 and 5 of the fraud claim assert lack of
bona fide use in commerce based on information and belief, the
necessary supplementary factual information on which these
allegations are based is provided in paragraphs 8, 9 and 10.



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Cancellation No. 92048821

Miller, supra, § 1298 (discussing particularity requirement

of Fed. R. Civ. P. 9(b)).

     A pleading of fraud on the USPTO must also include an

allegation of intent.    In re Bose, 

91 USPQ2d at 1939-1940

.

Moreover, although Rule 9(b) allows that intent may

be alleged generally, the pleadings must allege sufficient

underlying facts from which a court may reasonably infer

that a party acted with the requisite state of mind.

Exergen Corp., 

91 USPQ2d at 1667, n.4

.    Pleadings of fraud

which rest solely on allegations that the trademark

applicant or registrant made material representations of

fact in connection with its application or registration

which it “knew or should have known” to be false or

misleading are an insufficient pleading of fraud because it

implies mere negligence and negligence is not sufficient to

infer fraud or dishonesty.    In re Bose, 

91 USPQ2d at 1940

,

quoting Symbol Techs., Inc. v. Opticon, Inc., 

935 F.2d 1569, 1582

 (Fed. Cir. 1991).   Thus under Bose, intent is a

specific element of a fraud claim and an allegation that a

declarant “should have known” a material statement was false

does not make out a proper pleading.     See also Media Online,

88 USPQ2d at 1287 (finding proposed amended pleading

insufficient in part because the pleading lacked allegations

of scienter); Crown Wallcovering Corp. v. The Wall Paper

Mfrs. Ltd., 

188 USPQ 141

, 144 (TTAB 1975) and cases cited



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Cancellation No. 92048821

therein (“in order to state a claim upon which relief can be

granted on the ground of fraud, it must be asserted that the

false statements complained of were made willfully in bad

faith with the intent to obtain that to which the party

making the statements would not otherwise have been

entitled”).

     Petitioner’s allegations in Paragraphs 4 and 6 of the

amended petition to cancel which state that “registrant knew

or should have known…” are insufficient to infer

respondent’s intent to commit fraud on the USPTO.

     In view thereof, petitioner’s fraud claim is

insufficient.

     Because petitioner’s fraud claim was not properly

pleaded and is insufficient to state a claim, the motion for

summary judgment is deemed moot.   Intermed Communications,

Inc. v. Chaney, 

197 USPQ 501

, 503 n. 2 (TTAB 1977) (“If a

claim has not been properly pleaded, one cannot obtain

summary judgment thereon”).   See also Consolidated Foods

Corporation v. Berkshire Handkerchief Co., Inc., 

229 USPQ 619

, 621 (TTAB 1986) (The rule that only properly pleaded

issues may be the subject of a grant of summary judgment “is

especially important where the asserted ground for summary

judgment is fraud since in pleading fraud, ‘the

circumstances . . . shall be stated with particularity.’

Fed. R. Civ. P. 9(b)”).



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Cancellation No. 92048821

     We note in any event, that even if we were to consider

petitioner’s motion for summary judgment on the fraud claim

on its merits, the motion would have to be denied because

genuine issues remain at least with respect to respondent’s

intent to commit fraud on the USPTO.     A party making a fraud

claim is under a heavy burden because fraud must be “proven

‘to the hilt’ by clear and convincing evidence,” leaving

nothing to speculation, conjecture, or surmise; any doubt

must be resolved against the party making the claim.      Smith

International, Inc. v. Olin Corp., 

209 USPQ 1033

, 1043-1044

(TTAB 1981).   The factual question of intent is particularly

unsuited to disposition on summary judgment.      Copelands'

Enterprises Inc. v. CNV Inc., 

945 F.2d 1563

, 

20 USPQ2d 1295, 1299

 (Fed. Cir. 1991).

     Petitioner is allowed until TWENTY DAYS from the

mailing date of this order to file and serve an amended

pleading properly alleging fraud, if petitioner has a sound

basis for doing so, failing which, the existing allegations

regarding fraud are hereby stricken.3



3
  If petitioner repleads the fraud claim consistent with Bose, we
note that the basis for its summary judgment motion (i.e., fraud
based on non-use on one of the goods at the time of filing the
Section 8 and 15 declaration) was narrower than the fraud claim
petitioner attempted to assert in the operative amended petition
to cancel (i.e., fraud based on lack of bona fide use of the mark
in commerce at the time of filing the application and at the time
of filing the Section 8 and 15 declaration). Therefore,
petitioner may wish to narrow the basis for any prospective fraud
claim it may replead.



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Cancellation No. 92048821

     If petitioner does file an amended pleading, respondent

is allowed until FORTY days from the mailing date of this

order to file its answer thereto.

     Proceedings are resumed.         Dates in this proceeding are

reset as follows:

Discovery Closes                                     11/4/09
Plaintiff's Pretrial Disclosures                    12/19/09
Plaintiff's 30-day Trial Period Ends                  2/2/10
Defendant's Pretrial Disclosures                     2/17/10
Defendant's 30-day Trial Period Ends                  4/3/10
Plaintiff's Rebuttal Disclosures                     4/18/10
Plaintiff's 15-day Rebuttal Period Ends              5/18/10

     In each instance, a copy of the transcript of

testimony, together with copies of documentary exhibits,

must be served on the adverse party within thirty days after

completion of the taking of testimony.         Trademark Rule

2.l25.

     Briefs shall be filed in accordance with Trademark

Rules 2.128(a) and (b).      An oral hearing will be set only

upon request filed as provided by Trademark Rule 2.l29.




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