Likelihood of Confusion between HME and KME?

By Wei Wei Jeang

The U.S. District Court for the Eastern District of Virginia just overturned the TTAB (Trademark Trial and Appeal Board) decision refusing registration of applicant/appellant Zhejian Hailiang Co's application to register the design mark, HME:

in view of opposer KME Germany's design mark:

In 2019, applicant Zhejian bought the assets of opposer’s brass division and tubes manufacturing business. Applicant manufactures, advertises and sells, under the stylized HME mark, goods that opposer previously sold, to customers who previously were opposer’s customers in the United. States. In the Asset Purchase Agreement, the two parties agreed that opposer would "maintain sole rights in the designation 'KME' for use as a trademark," and that applicant would 'cease making use of the trade names and product or services marks of [opposer] or confusingly similar designations or trademarks."

The applicant, Zhejian, applied for the stylized HME mark to cover pipes and other types of building products, and opposer filed to oppose its registration.

The TTAB found that the two marks are similar in appearance, sound, connotation, and commercial impression. The Board found that the stylized designs of the two marks are visually similar. The Board also found that opposer's mark is well-known because it is an "internationally acclaimed producer in its product market," and that opposer has used the KME mark for 25 years. Opposer submitted four emails that purportedly demonstrated actual confusion by the target consumers. Due to these and other factors, the Board issued a precedential opinion in which it concluded that opposer proved likelihood of confusion and applicant's registration should be denied.

Upon taking up the appeal, the EDVa court granted the Zhejian's motion for summary judgment because "among other things, the Court finds that in its opposition to plaintiff's regisration of the mark at issue, the defendant engaged in inequitable conduct before the Trademark Trial and Appeal Board." The Court reversed the TTAB decision and ordered the HME trademark be registered. In Zhejian's brief in support of its Motion to Find Case Exceptional and Award Attorneys' Fees and Costs, it presented evidence that KME itself helped develop the HME logo, and more importantly, gave Zhejian permission to use the HME name if the logo used a different style and color from the KME logo. Zhejian also pointed out that KME knowingly submitted false testimony to the TTAB, and there was no actual confusion. KME is yet to file its response to Zhejian's brief.