Property, intangible

a blog about ownership of intellectual property rights and its licensing

Devil in the Details

In Angel Flight of Georgia, Inc. v. Angel Flight America, Inc., the 11th Circuit decision left open more questions than it answered. Two entities with an admirable purpose, providing free transportation for donated organs and medical patients, were using the same trademark, ANGEL FLIGHT, in the same territory – plaintiff Angel Flight Georgia (AF-GA) and defendant Angel Flight Southeast (AF-SE). AF-SE was a member of national organization and intervenor Angel Flight America (AFA) but AF-GA was not. The suit had cross-claims for trademark infringement; clearly it was a case about priority of use. The 11th Circuit decision said nothing about priority though; the only issues for appeal were a hearsay objection, an appeal of the laches defense, the scope of the injunction, and the cancellation of AFA’s trademark registration. The lower court had held for AF-GA on priority and likelihood of confusion but there was no appeal on these issues.

The decision doesn’t even mention in passing the obvious question – that it could hardly be a coincidence that both parties adopted the same mark. Digging into the trial record, it turns out it is an oft-told tale of trust and cooperation eventually displaced by bickering and turf wars, with the trademark caught in the middle. It’s a situation that trademark law is ill-equipped to deal with in a way that seems fair to all concerned, the trademark combatants and the public.

Below is a summary of salient facts gathered from the trial court’s Findings of Fact and Conclusions of Law (adopting the Plaintiff’s Proposed Findings of Fact and Conclusions of Law) and the Defendant’s Proposed Findings of Fact and Conclusions of Law. I have tried to make it clear where the parties disagree (which is often) and also to make my editorializing clear. Links to both documents are at the end of the post.

In this case, the first entity to use ANGEL FLIGHT was a Nevada organization started by Jack Welsh. “American Medical Support Flight Team” (AMSFT) used the mark ANGEL FLIGHT and a caduceus logo in 1982, below:

The plaintiff started its organization in 1983, also calling it “American Medical Support Flight Team” and using ANGEL FLIGHT as a trademark. There were other organizations formed in the early 1980’s that were also called “American Medical Support Flight Team” and that used the ANGEL FLIGHT mark. The plaintiff’s version is coy: “several organizations based loosely on Welsh’s concept formed independently in different areas of the country”; the defendant says “Mr. Welsh recruited volunteers in the early 1980s to form the AMSFT chapter in Los Angeles. He also recruited Mary Webb to form AMSFT-Central Florida [which became defendant AF-SE] and he recruited James Shafer to start AMSFT-GA [which became plaintiff AF-GA].” The plaintiff agrees that it helped Mary Webb start AMSFT-Central Florida. It was formed in 1986.

AF-GA acknowledges that it used both ANGEL FLIGHT and the Welsh caduceus logo from its inception. There quickly was some distancing placed between Mr. Welsh and at least the LA chapter (plaintiff’s version) if not all of them (defendant’s version), but they all continued to operate. At least four other organizations using ANGEL FLIGHT formed by no later than the 1990s: East, Oklahoma, South Central, and Mid-Atlantic. Ultimately all organizations’ corporate names were “Angel Flight” with a geographic indicator.

In 1986 the Nevada organization dissolved. The LA organization, after learning that the Nevada organization was gone, filed a trademark application for ANGEL FLIGHT and Design (modified from the original Nevada logo), below:

There was no formal assignment of rights from the Nevada organization to the LA organization.

(NB there was a successful challenge to the registration based on fraud. It is irrelevant for the purposes of this discussion, though, since the plaintiff’s first use date was prior to the date of registration and it only sought the right to use its mark in the territory in existence at the time of registration.)

For several years beginning in the mid-1990s, by express written agreement AF-SE coordinated flights for AF-GA. There were also discussions about the merger of the two entities during that time, but it didn’t happen. For some period of time, everyone agrees, AF-GA used the LA logo as well as the ANGEL FLIGHT mark. There was testimony that during this time the various entities, including the trademark owner LA, thought that LA’s trademark rights extended only to the design and that no single entity had the right to use the words ANGEL FLIGHT.

Reading between the lines it looks like AF-GA and AF-SE were cooperating and working towards a merger, but in 1999 had a falling out and started to work independently again. Around the same time, some of the organizations were trying to form a national organization. Eventually six of them, including AF-SE, formed intervenor AFA. AF-GA, as well as the Oklahoma and East organizations, did not join. There is no explanation why some joined and some did not. The six organizations that became members of AFA divided the country into territories that included areas covered by the non-members. LA assigned its trademark registration to AFA.

In 1999, at the time AF-GA and AF-SW parted ways, AF-GA modified its logo to this:

Bitter warfare ensued. AFA was trying to create a unified national organization, and it appears that member AF-SW undertook a deliberate campaign to supplant non-member AF-GA in its territory. For 20 years there had been no confusion, but in 2001 AF-SW opened an office in Georgia for the first time, circulated false rumors that AF-GA was “closing their doors,” and staged promotional activities in AF-GA’s hometown of Atlanta. The court found that there were hundreds of incidents of actual confusion. It ultimately held that AF-GA was the senior user in a six-state territory and enjoined AFA and its members, including not only defendant AF-SE but two other non-party AFA members, from using the mark in the AF-GA territory.

So, everyone copied ANGEL FLIGHT from the long-defunct Nevada organization. It is a situation where multiple entities deliberately adopted the same mark (not to mention the same corporate name) in order to gain the benefits of recognition of the mark. When there was a failure of cooperation, trademark law was ill-equipped to find an equitable solution. On one hand we have an organization that is admirably trying to establish a unified nationwide organization to exploit the benefits of scale for a charitable organization. On the other hand, we have an entity that is being deliberately stripped of a mark it has used for 20 years, and used first. Nevertheless, although AF-GA was technically first, both organizations likely started at Mr. Welsh’s instigation and AF-GA merely hit the lottery because it was up and running earlier than AF-SE was.

Defendants tried almost all conceivable defenses to infringement (note that it also argued confusion as the senior user, but failed to prove it was senior user). It argued that AF-GA was not the owner of the mark, but instead a licensee of either AMSFT-Nevada or LA; the court held there was insufficient proof of control by either to show they were licensors. Defendants argued that AF-GA abandoned its mark during the period that AF-SE was coordinating AF-GA’s flights, but AF-GA did not discontinue use and there was no intent not to resume use. Defendants argued laches and acquiescence, but AF-GA successfully countered progressive encroachment. Defendants argue unclean hands based on a Georgia state registration but did not convince the court there was any fraud in procuring the state registration. Defendants did not argue genericism, but that would have been a poison pill since Defendants also claimed trademark rights in ANGEL FLIGHT.

The most natural argument in a case where one entity copies another’s mark was not raised at trial. AF-GA was junior to the Nevada entity’s use and clearly copied that entity’s mark, but there was no argument that AF-GA was NOT a junior user in good faith because it lacked the “good faith” element of the defense. “With respect to the good-faith requirement, courts are divided on whether the junior user must establish a lack of actual knowledge that the mark was already in use, see 4 J. McCarthy, supra, § 26:9 (majority view), or merely that there was no intent to infringe, see id. at § 26:10 (minority view).” Emergency One, Inc. v. American Fire Eagle Engine Co., Inc., 332 F.3d 264, 271 (4th Cir. 2003). What’s missing here, of course, and perhaps why it was an argument not made, is that the owner of the trademark copied does not exist. There was no true successor to the Nevada rights; LA claimed to have successor rights (the fraudulent date of first use was Nevada’s first use, not its own) but it was in no better a position to claim it was a successor than AF-GA. I do not recall seeing a case where the defense was raised when the third-party owner was absent from the proceeding; please comment if you know of one.

A complicated set of facts, even more complicated in full. Here they are.

District Court Findings of Fact and Conclusions of Law (not published), available here.
Defendants’ Proposed Findings of Fact and Conclusions of Law (not published), available here.
District Court summary judgment opinion, Angel Flight of Georgia, Inc. v. Angel Flight Southeast, Inc., 424 F.Supp.2d 1366 (N.D. Ga. 2006), available here.
Angel Flight of Georgia, Inc. v. Angel Flight America, Inc., 522 F.3d 1200 (11th Cir. 2008), available here.

News report on court’s decision on likelihood of confusion here.
Blog report here.

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