The statement in Firehouse is that “[f]raud in the procurement of a trademark registration is also a defense to a claim of trademark infringement.” The court cited a footnote in Lone Star Steakhouse & Saloon, Inc. v. Alpha of VA, Inc., 43 F.3d 922, 931, n.12 (4th Cir. 1995) in support of its statement. Lone Star says “the Lanham Act provides that trademarks procured by fraud are unenforceable,” citing to 15 U.S.C. §§ 1052 and 1064. What? Neither of those sections says that. Section 1052 mentions a number of bases for refusing registration, but fraud isn’t one of them. Section 1064 gets closer; it provides that a trademark registration may be cancelled if the registration was obtained fraudulently. But since in the United States trademark rights are based on use, not registration, cancelling a registration shouldn’t mean that the trademark owner has no trademark rights at all; instead it should only mean the trademark owner doesn’t have any of the benefits that a federal registration provides. Nevertheless, the Lone Star court, in dicta, made the leap that a trademark registration procured by fraud means that the common law trademark is also unenforceable.
Firehouse Restaurant Group, Inc. v. Scurmont LLC, Civil Action No. 4:09-cv-00618-RBH (D.S.C. Oct. 17, 2011).
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