Adidas has lost the latest round in a trademark matter it initiated against a Christian church. Yes, you read that correctly. In a ruling this week, the U.S. Court of Appeals for the Federal Circuit refused to cancel the Christian Faith and Fellowship Church's "Add a Zero" trademarks, marking a blow for adidas in its fight to register “Adizero” — the name it uses for a super lightweight line of sneakers.
Since 2009, the German sportswear giant has been attempting to federally register its “Adizero” mark but has been unable to due to existing trademarks held by the Chicago-based church, including one that extends to clothing, "namely, shirts, and caps." Initially, the U.S. Patent and Trademark Office (“USPTO”) refused adidas’ trademark application because of its similarity to the church’s own "Add a Zero" trademarks - the first of which was registered in 2006. According to the USPTO, consumers were likely to be confused due to the similarity of the two parties' trademarks.
As a result, adidas filed a motion with the USPTO’s Trademark Trial and Appeal Board (“TTAB”) to have the church's trademarks cancelled, arguing that the trademarks are invalid. Adidas held that the "Add a Zero" marks should be cancelled because the church failed to use them in commerce before registration (as required by the Lanham Act, the statute that governs federal trademark law in the U.S.); the church’s marks fail to function as trademarks (aka fail to serve a source-identifying function); and the church has actually abandoned its right in the trademarks by not using them consistently in commerce, which is also required by U.S. law.
The TTAB ruled in adidas' favor last year, finding the church's sale of only two hats to a Wisconsin parishioner did not meet the required level of use in order to maintain trademark rights. In trademark terms, the sale of two hats did not have a "substantial effect on interstate commerce." As a result, the TTAB - a body within the USPTO responsible for hearing and deciding certain kinds of trademark cases, including oppositions and appeals - canceled the church's marks on that basis without considering adidas' other challenges. The church appealed to the Federal Circuit.
Writing for the Federal Circuit panel, Judge Kara Farnandez Stoll stated on Monday that the Lanham Act's definition of "use in commerce" includes any activity that Congress could regulate under the Commerce Clause. Sale of clothing to an out-of-state buyer "falls comfortably within" that definition, Stoll wrote in the decision joined by Judges Jimmie Reyna and Todd Hughes.
The Federal Circuit refused to require a specific number of transactions to meet the "use in commerce" standard. To the extent that the TTAB's own decisions may conflict with that rule, they are expressly overturned, the court held. The Federal Circuit sent the case back to the TTAB for consideration of other arguments raised by adidas.
* The case is Christian Faith Fellowship Church v. Adidas AG, U.S. Court of Appeals for the Federal Circuit No. 16-1296