Addressing the cancellation of four word marks based on alleged fraud on the U.S. Patent and Trademark Office (PTO), the United States Court of Appeals for the Eleventh Circuit found that a district court clearly erred in ruling that the plaintiff, a religious organization, committed fraud where a declarant had no awareness that any other organization was using marks for which protection was sought. Sovereign Military Hospitaller Order of Saint John of Jerusalem of Rhodes and Malta v. Florida Priory of the Knights Hospitallers of the Sovereign Order of Saint John of Jerusalem, Knights of Malta, The Ecumenical Order,  Case No. 11-15101 (11th Cir. September 11, 2012) (Wilson, J.) (Pryor, J., concurring-in-part and dissenting-in-part).

The plaintiff is a religious order of the Roman Catholic Church that offers charitable services, while defendant is also a charitable organization, having an ecumenical, rather than Roman Catholic, association.  The plaintiff filed trademark infringement and false advertising claims under the Lanham Act and state law claims based on the defendant’s use of word marks that were confusingly similar to the plaintiff’s registered marks.  The plaintiff also claimed defendant falsely claimed a connection to plaintiff dating back to the 11th century.  The defendant counterclaimed, asserting that the plaintiff committed fraud on the PTO for failing to disclose the existence of other organizations that used similar word marks.

The district court ruled in favor of the defendant on all counts, finding that the plaintiff committed fraud on the PTO based on the defendant’s use of a similar mark before the plaintiff.  The plaintiff appealed.

The 11th Circuit affirmed in part, reversed in part and remanded for further proceedings.  The fraud holding was based on a declaration in support of registration submitted by the applicant’s representative attesting that there were no similar marks under 15 U.S.C. § 1051 (a)(3).  The 11th Circuit found that the representative could not have intended to deceive the PTO in attesting to an oath that he believed was entirely accurate, as he was personally unaware that any other organization was using the marks for which plaintiff sought a trademark.

The 11th Circuit found that it was error for the district court to rely on Global-Tech Appliances, a patent case, for the applicable standard for a claim of fraud on the PTO for a trademark.  The 11th Circuit found that standards cannot be imported between different intellectual property, such as patents and trademarks.  The appeals court also found that if a declarant subjectively believed the applicant has a superior right to use the mark, there is no fraud, even if the declarant was mistaken, such as in this case, where the defendant did not put forth evidence to establish that the declarant knew or believed that the defendant had a superior right to use the mark.  The plaintiff’s relevant service mark registrations provided that the marks were first used in commerce in 1926 and 1927, well before defendant claimed to use its similar marks in 1983. 

The 11th Circuit reversed the finding of fraud on the PTO and also remanded the trademark infringement claims because there were not sufficient factual findings by the district court as a result of the fraud finding.  The 11th Circuit dismissed the false advertising claim because the defendant truthfully had represented that it shared a common predecessor with the plaintiff.