Aycock Engineering, Inc. v. Airflite, Inc.

United States Court of Appeals for the Federal Circuit

2008-1154
(Cancellation No. 92/032,520)

AYCOCK ENGINEERING, INC.,

Appellant,

v.

AIRFLITE, INC.,

Appellee.

Rebecca E. Crandall, Coats & Bennett, PLLC, of Cary, North Carolina, argued for
appellant. With her on the brief was Anthony J. Biller.

David J. Kera, Oblon, Spivak, McClelland, Maier, & Neustadt, P.C., of
Alexandria, Virginia, argued for appellee.

Appealed from: United States Patent and Trademark Office
Trademark Trial and Appeal Board.
United States Court of Appeals for the Federal Circuit
2008-1154
(Cancellation No. 92/032,520)

AYCOCK ENGINEERING, INC.,

Appellant,

v.

AIRFLITE, INC.,

Appellee.

Appeal from the United States Patent and Trademark Office, Trademark Trial and
Appeal Board, Canc. No. 92/032,520.
__________________________

DECIDED: March 30, 2009
__________________________

Before NEWMAN and LINN, Circuit Judges, and O’GRADY, District Judge. *

Opinion for the court filed by District Judge O’GRADY. Dissenting opinion filed by
Circuit Judge NEWMAN.

O’GRADY, District Judge.

In 1970, Respondent-Appellant Aycock Engineering, Inc. (“Aycock Engineering”)

applied for a service mark, which was registered at the United States Patent and

Trademark Office (“USPTO”) in 1974 after examination. In 2007, however, the USPTO

Trademark Trial and Appeal Board (“TTAB”) declared the registration void because it

failed to meet the “use in commerce” element of the Lanham Act. Aycock Engineering

now appeals the TTAB’s ruling. The question presented herein is whether the use in

*
Honorable Liam O’Grady, District Judge, United States District Court for
the Eastern District of Virginia, sitting by designation.
commerce requirement is met when an applicant uses a service mark in the preparatory

stages of a service’s development, but never offers the service to the public. We hold

that it is not.

I. BACKGROUND 1

In the late 1940s, William Aycock conceived of and began work on a service

involving chartering flights in the air taxi industry. At that time, the common practice for

air taxi companies was to lease entire airplanes, not individual seats. Consequently,

individual passengers not belonging to a larger party faced more difficulty and expense

in chartering a flight. Mr. Aycock intended, through his service, to allow solo

passengers to arrange flights on chartered aircraft for less cost.

Mr. Aycock did not plan on operating the chartered air taxi services himself.

Instead, his goal was to develop a system where he would serve his customers by

acting as the middleman, or “communication link,” between the customer and one of the

air taxi service operators he contracted with to provide flights on an individual seat

basis. Mr. Aycock planned to advertise his service, which he called the AIRFLITE

service, to the public and to have those interested in using the service call a toll-free

phone number to schedule reservations. After learning of customers’ travel plans, Mr.

Aycock would then arrange for the air taxi service to fly his customers with similar travel

plans to their destinations. Mr. Aycock believed that in order for his service to become

operational, he needed at least 300 air taxi operators in the United States to agree to

participate in his air-taxi-operator network. 2

1
The following facts are undisputed unless noted herein.

2008-1154 2
 In the years after conceiving of the idea for his service, Mr. Aycock worked

toward offering the service to the public. In the mid-1960s, he formed Aycock

Engineering—the corporate entity under which his service would operate. He also

sought and obtained two toll-free telephone numbers that the public could use to make

reservations. In March of 1970, Mr. Aycock invited virtually all air taxi operators certified

by the Federal Aviation Administration (“FAA”) to join his operation by, inter alia,

distributing flyers with in-depth information about his AIRFLITE service. He eventually

entered into contracts with some of those air taxi service operators. 3 Under these

contracts, air taxi operators agreed to participate in the AIRFLITE service and even paid

modest initiation fees to Mr. Aycock. Furthermore, Mr. Aycock filed a service mark

application on August 10, 1970 for the term AIRFLITE, which was a term he had

included in his advertisements.

Despite his efforts, Mr. Aycock’s operation never got off the ground. While he

estimated that he needed at least 300 air service operators under contract to make his

service operational, Mr. Aycock never had more than twelve (4% of his minimum goal)

under contract at any time throughout his company’s history. And while Mr. Aycock

advertised to air taxi operators, he never marketed the AIRFLITE service to the general

public. More specifically, the record does not suggest that Mr. Aycock ever gave the

public an opportunity to use the toll-free phone numbers to book reservations, or that he

ever spoke with a member of the general public about making a reservation. Finally,

2
Mr. Aycock stated in his deposition, “We start this when 300 air taxi
operators in the United States have signed on to provide the transportation.” J.A. 1942.
3
Some of the contracts originated in the 1970s, and some came as late as
2001.

2008-1154 3
and most notably, Mr. Aycock never arranged for a single passenger to fly on a

chartered flight. 4

Mr. Aycock’s AIRFLITE mark, which he applied for on August 10, 1970, was

registered by the USPTO on April 30, 1974 on the Supplemental Register after a

prosecution that involved considerable negotiation between Mr. Aycock and the

trademark examining attorney. During the prosecution process, Mr. Aycock made

several representations about his service. Mr. Aycock stated that “[t]his service is a

communication service between persons desiring to charter aircraft and certified air taxi

operators.” J.A. 736. Mr. Aycock also represented that his “primary service is putting

individuals desiring air transportation in contact with people rendering this service,” and

that he “does not himself transport but only places the parties in contact with each

other.” Id. at 749. The recitation of services for the AIRFLITE service mark eventually

agreed upon by the USPTO and Mr. Aycock was “[a]rranging for individual reservations

for flights on airplanes.” Id. at 729. Mr. Aycock’s application to renew his AIRFLITE

service mark was granted by the USPTO on April 27, 1994.

In 2001, Airflite, Inc., the Petitioner-Appellee, filed a petition for cancellation

alleging, inter alia, that Aycock Engineering did not use its AIRFLITE mark prior to

registration in connection with the services identified in its registration. In that

proceeding, the TTAB agreed with Airflite, Inc. and cancelled the AIRFLITE registration,

finding that Mr. Aycock failed to render the service described in its registration in

4
When asked at his deposition whether he had ever arranged for an
individual to fly on an airplane, Mr. Aycock stated, “I had never made a—any
arrangement . . . I had never had a talk with the customer then talked with the air taxi
operator and reached any agreement on them carrying the customer.” J.A. 858.

2008-1154 4
commerce. Airflite, Inc. v. Aycock Eng’g, Inc., Cancellation 92032520, 2007 WL

2972237, at *7 (TTAB Oct. 4, 2007) (“TTAB Decision”). 5

II. DISCUSSION

A. Jurisdiction

Aycock Engineering timely filed its appeal under 15 U.S.C. § 1071 (2006), which

permits both an applicant for registration of a mark and a party to a cancellation

proceeding to appeal decisions of the TTAB to this Court. Jurisdiction arises under

28 U.S.C. § 1295(a)(4)(B) (2006), which authorizes the Court to hear appeals of TTAB

decisions filed under 15 U.S.C. § 1071.

B. Standard of Review

We review the TTAB’s legal conclusions de novo. In re Pacer Tech., 338 F.3d

1348, 1349 (Fed. Cir. 2003) (citing In re Int’l Flavors & Fragrances Inc., 183 F.3d 1361,

1365 (Fed. Cir. 1999)). The TTAB’s factual findings are reviewed for substantial

evidence. Id. (citing On-Line Careline, Inc. v. Am. Online, Inc., 229 F.3d 1080, 1085

(Fed. Cir. 2000)). “Substantial evidence is ‘more than a mere scintilla’ and ‘such

relevant evidence as a reasonable mind would accept as adequate’ to support a

conclusion.” Id. (citing Consol. Edison v. NLRB, 305 U.S. 197, 229 (1938)).

5
Because it cancelled the AIRFLITE mark on use requirement grounds, the
TTAB declined to decide the other issues before it, which were priority of use and
likelihood of confusion, fraud, and abandonment. In this appeal, we only consider the
issue of whether the use requirement is met. We do not consider the issues that the
TTAB declined to address.
As our colleague notes, the TTAB also addressed the issue of whether the
activity described in the registration description qualifies as a registrable service. We
decline to address this issue, however, because our decision today rests independently
on use requirement grounds.

2008-1154 5
C. Interpretation of the Recitation of Services in Mr. Aycock’s Service Mark Application

A prerequisite to deciding the use requirement issue, discussed infra, involves

defining the recitation of services in the application. 6 Mr. Aycock’s registration

describes the services rendered under the mark as “arranging for individual reservations

for flights on airplanes.” TTAB Decision, 2007 WL 2972237, at 2. The TTAB concluded

that the scope of this description was “limited to regulating, coordinating, operating, or

administering a system to book flights on airplanes,” which required more than

arranging the network of air taxi operators. Id. at *6. Mr. Aycock argues that the

TTAB’s construction of the services in the registration was erroneous, and that the

record, including the prosecution history, supports a construction that permits the mere

arranging of a network of air taxi operators by itself to constitute the service. Airflite

counters that the TTAB correctly construed the services at issue.

We agree with the TTAB that the service described in Mr. Aycock’s registration is

arranging for the transportation of a person from one place to another or providing a

communication service between a person desiring custom air travel and an air taxi

operator, and that this entails more than the arranging of the network of air taxi

operators. During prosecution, Mr. Aycock repeatedly emphasized that his service was

the arrangement for transportation between a person and an air taxi service on a per

seat basis. For example, early in the prosecution he described the services behind the

mark for which he sought registration as “a communication service between persons

6
Registration must be examined based on the identification description.
See In re Shell Oil Co., 992 F.2d 1204, 1207-08 (Fed. Cir. 1993); Octocom Sys. Inc. v.
Houston Computer Servs. Inc., 918 F.2d 937, 942 (Fed. Cir. 1990).

2008-1154 6
desiring to charter aircraft and certified air taxi operators.” J.A. 736. Mr. Aycock later

explained: “Applicant’s primary service is putting individuals desiring air transportation in

contact with people rendering this service. Applicant does not himself transport but only

places the parties in contact with each other.” Id. at 749. In the final amendment before

the registration was allowed on the Supplemental Register, Mr. Aycock stated:

It should again be emphasized that the service rendered by Applicant is
not a service of arranging charter aircraft but rather is the arrangement of
transportation on a per seat basis from one point to another, with the local
aircraft operator, under his own trademark whatever it may be, to actually
do the flying. In other words, the mark “Airflite” would not be descriptive of
a ticket sales organization and this, in effect, is what Applicant’s service is
all about.

Id. at 745. These representations to the examiner make clear that “arranging for

individual reservations for flights on airplanes” means just that, and includes more than

Mr. Aycock’s preparatory efforts to arrange a network of air taxi operators. Notably, Mr.

Aycock’s contracts with the air taxi operators reinforce that the nature of his service was

the arranging of flights for persons desiring air taxi service, not merely the creation of a

network to do so. Id. at 448 (“AIRFLITE personnel will be on duty at all times and hours

of the day for the purpose of arranging air transportation for the traveling public . . . .”);

id. at 454 (“AYCOCK will operate suitable facilities and equipment to maintain a

constant knowledge of all reservations and flights, and personnel will be on duty at all

times to arrange AIRFLITE air transportation for Customers with OPERATOR.

AYCOCK will use its best efforts to find and group Customers, timewise and

directionwise just as scheduled airlines do, so as to put together profitable payloads

going both ways that the OPERATOR can carry.”). Thus, we affirm the TTAB’s

2008-1154 7
determination that the scope of the services defined in the registration requires the

arranging of flights between an air taxi operator and a passenger. 7

Mr. Aycock also argues that “law of the case” precludes the TTAB’s

determination. At the summary judgment stage of the proceedings below, the TTAB

concluded that the recitation of services “may be broad enough to encompass both the

services [Mr. Aycock] contends that it provides as well as those [Airflite] asserts it has

never provided.” J.A. 289. Thus, according to Mr. Aycock, this determination on

summary judgment precluded the TTAB from later construing the registration

description to mean that merely arranging the network of air taxi operators by itself was

insufficient to constitute the service. Mr. Aycock misunderstands the law of the case

doctrine, which simply does not apply to a denial of summary judgment. E.g.,

Bethlehem Steel Exp. Corp. v. Redondo Constr. Corp., 140 F.3d 319, 321 (1st Cir.

1998). In any event, assuming for the sake of argument that a denial of summary

judgment could invoke law of the case, the TTAB’s determination on summary judgment

that Mr. Aycock’s registration “may be broad enough” to include certain services does

not foreclose the TTAB from determining, based upon the entire record (including trial,

briefing, and oral argument), what the registration actually covers.

Thus, we conclude that the TTAB correctly construed the scope of Mr. Aycock’s

registration to require more than the arranging of the network of air taxi operators.

7
We respectfully disagree with our esteemed colleague’s interpretation of
the recitation of services found in her dissent. We believe that the communications
between Mr. Aycock and the trademark examining attorney show that Mr. Aycock’s
service required some contact between a potential customer desiring to reserve a seat
on a chartered flight and his company. Therefore, it is our view that the definition of the
recitation of services required offering the service to a potential customer.

2008-1154 8
 D. Use Requirement

Under § 45 of the Lanham Act, a service mark is any “word, name, symbol or

device, or any combination thereof used by a person, or which a person has a bona fide

intention to use in commerce . . . to identify and distinguish the services of one person

. . . from the services of others.” 15 U.S.C. § 1127 (2006). The definition of “service

mark” is virtually identical to the definition of “trademark.” But while service marks apply

to intangible services, trademarks are used to distinguish tangible goods. See id.;

Chance v. Pac-Tel Teletrac Inc., 242 F.3d 1151, 1156 (9th Cir. 2001); Lloyd’s Food

Prods., Inc. v. Eli’s, Inc., 987 F.2d 766, 768 (Fed. Cir. 1993).

“It is clear from the wording of the Lanham Act that applications for service mark

registrations are subject to the same statutory criteria as are trademarks.” 3 J. Thomas

McCarthy, McCarthy on Trademarks and Unfair Competition § 19:82 (4th ed. 2008)

[hereinafter McCarthy]; see 15 U.S.C. § 1053 (2006). One such statutory criterion that

applies to both trademarks and service marks is the “use in commerce” requirement.

For trademarks, the “use in commerce” requirement is met when a mark is (1) placed on

the good or container, or on documents associated with the goods if the nature of the

goods makes placement on the good or container impracticable, and (2) that good is

then “sold or transported in commerce.” 15 U.S.C. § 1127 (2006). For service marks,

the “use in commerce” requirement is met when (1) a mark is “used or displayed in the

sale or advertising of services” and (2) either (i) the services are “rendered in

commerce” or (ii) the services are “rendered in more than one State or in the United

States and a foreign country and the person rendering those services is engaged in

2008-1154 9
commerce in connection with the services.” 8 Id. The registration of a mark that does

not meet the use requirement is void ab initio. 9 See Gay Toys, Inc. v. McDonald’s

Corp., 585 F.2d 1067, 1068 (CCPA 1978); 3 McCarthy § 19:112.

Despite the seeming harmony and simplicity in the application of the use

requirement to trademarks and service marks, opportunity exists for confusion in this

area of the law. Different statutory requirements apply to applications filed before

November 16, 1989, as compared to those filed after. This is because in 1988,

Congress passed the Trademark Law Revision Act (“TLRA”). The TLRA altered the

burden that applicants must meet before satisfying the use element by requiring an

applicant to make a “bona fide use of [the] mark in the ordinary course of trade.”

Trademark Law Revision Act of 1988, Pub. L. No. 100-667, 102 Stat. 3935 (effective

November 16, 1989) (codified at 15 U.S.C. § 1127 (2006)).

This “bona fide use” language was intended to eliminate “token uses,” which

occurred when applicants used marks in conjunction with selling goods or offering

services for the sole purpose of obtaining registration, and with no intention of

legitimately using the mark in commerce until a later date. See Blue Bell, Inc. v.

Jaymar-Ruby, Inc., 497 F.2d 433, 437 (2d Cir. 1974). Before 1989, a “token use” was

sufficient to satisfy the use requirement and qualify a mark for registration. See id.

8
“Although [element 2(ii) of the service mark use requirement] was added
in 1962 with the intention of expanding the coverage, it has turned out that [element 2(i)]
has provided the basis for the broadest interpretation of use in commerce.” 3 McCarthy
§ 19:103 (internal citations omitted). “In light of subsequent decisions, the 1962 addition
turned out to be more restrictive than the older ‘rendered in commerce’ phrase.” Id.
9
“Void ab initio” means “[n]ull from the beginning.” Black’s Law Dictionary
1064 (8th ed. 2004).

2008-1154 10
 In addition to eliminating token uses, the 1988 TLRA made other changes to the

use requirement. Before 1989, an applicant only qualified for registration if he was

using his mark in commerce at the time he filed his application at the USPTO.

WarnerVision Entm’t Inc., v. Empire of Carolina, Inc., 101 F.3d 259, 260 (2d Cir. 1996).

But after 1989, an applicant could begin the registration process even when his mark

was not in use in commerce at the time of the filing, so long as he had a “bona fide

intention to use the mark in commerce” at a later date. 15 U.S.C. § 1051(b) (2006).

Applicants filing these “intent to use” applications are only granted registration, however,

if they file a verified statement of commercial use proving eventual use of the mark in

commerce. Id. § 1051(d). 10

Because the mark at issue here is a service mark, the use requirement relating to

service mark applications, as opposed to trademark applications, guides our analysis.

Furthermore, the application at issue in this case was filed in 1970. Therefore, this case

must be decided according to the service mark use requirement that appeared in the

Lanham Act in 1970 (i.e., the pre-1989 version). See 3 McCarthy § 19:112. However,

for the reasons stated below, our holding in this case also applies to the current (and

post-1989) service mark use requirement.

10
The exception to this rule, which applies to foreign applicants, provides
that
[a] mark duly registered in the country of origin of the foreign applicant may be
registered on the principal register if eligible, otherwise on the supplemental
register in this chapter provided . . . . The application must state the applicant’s
bona fide intention to use the mark in commerce, but use in commerce shall not
be required prior to registration.
15 U.S.C. § 1126(e) (2006).

2008-1154 11
 E. Use Requirement for Service Marks

With the exception of the 1988 TLRA statutory language eliminating token uses

and permitting intent-to-use applications, the service mark use requirement as it

appeared in 1970 is materially identical to the post-1989 version. The use provision of

the Lanham Act in force in 1970 stated that a service mark was in use in commerce

“when it is used or displayed in the sale or advertising of services, and the services are

rendered in commerce, or the services are rendered in more than one State or in this

and a foreign country and the person rendering the services is engaged in commerce in

connection therewith.” Pub. L. No. 87-772, 76 Stat. 769 (1962). Therefore, like the

current use requirement, a service mark applicant seeking to meet the pre-1989 version

had to (1) use the mark in the sale or advertising of a service and (2) show that the

service was either rendered in interstate commerce or rendered in more than one state

or in this and a foreign country by a person engaged in commerce.

Courts, as well as the TTAB, have interpreted the pre-1989 statutory language in

analogous cases. Without question, advertising or publicizing a service that the

applicant intends to perform in the future will not support registration. In re Cedar Point,

Inc., 220 USPQ 533, 536 (TTAB 1983) (quoting Intermed Commc’ns, Inc. v. Chaney,

197 USPQ 501, 507-08 (TTAB 1977)); Greyhound Corp. v. Armour Life Ins. Co., 214

USPQ 473, 474 (TTAB 1982). Instead, the advertising or publicizing must relate to “an

existing service which has already been offered to the public.” Greyhound, 214 USPQ

at 474. Furthermore, “[m]ere adoption (selection) of a mark accompanied by

preparations to begin its use are insufficient . . . for claiming ownership of and applying

2008-1154 12
to register the mark.” Intermed, 197 USPQ at 507; see Blue Bell, 497 F.2d at 437. “At

the very least,” in order for an applicant to meet the use requirement, “there must be an

open and notorious public offering of the services to those for whom the services are

intended.” Intermed, 197 USPQ at 507.

In Intermed, the TTAB rejected a service mark application for failing to meet the

use in commerce requirement even where the applicant had performed many pre-

application service-oriented activities involving the public. Id. at 508-09. The applicant

in that case sought to register a mark intended to identify an international medical

services operation. Id. at 502. The applicant’s plan was to build the international

service from an already operating United States-based medical service. Id. at 503. The

applicant intended to, and did use the United States-based operation as a fundraising

affiliate of the new international operation. Id. at 504. Additionally, the applicant

communicated with and solicited the support of the Iranian government regarding the

service before the application was filed. Id. The applicant also issued a detailed

announcement using the service mark term before the filing date designed to inform and

update individuals about the service’s status. Id. Finally, and also before the date of

application, the applicant hired a fundraising firm to raise money for the service. Id. at

508.

Despite these activities, the TTAB held that the applicant failed to meet the use

requirement because the services described in the application were not “offered,

promoted, advertised or rendered . . . in commerce.” Intermed, 197 USPQ at 504. The

TTAB stated that “[t]he statute requires not only the display of the mark in the sale or

advertising of services but also the rendition of those services in order to constitute use

2008-1154 13
of the service mark in commerce.” Id. At 507-08. The TTAB further explained that

adopting a mark accompanied by mere “preparations to begin its use” is insufficient for

service mark registration, and that in order for the use requirement to be met, there

must be “an open and notorious public offering of the services to those for whom the

services are intended.” Id. at 507.

In 1983, the TTAB again rejected a service mark application because it failed to

meet the use requirement. Cedar Point, 220 USPQ at 533. In Cedar Point, the Cedar

Point amusement park, which had been in business for decades, was preparing to open

a new water park addition in mid-May of 1980. Id. at 535. One preparatory step taken

by Cedar Point before opening day was the filing of a service mark application to

register the mark “OCEANA” for its new water park service. Id. Cedar Point also

distributed nearly 700,000 water park advertisement brochures containing the OCEANA

mark during the months preceding the grand opening. Id.

The TTAB emphasized the fact that Cedar Point filed its service mark application

with the USPTO before it opened the water park’s doors and offered those services to

the public. Id. at 535-36. The TTAB then explained that the use of a mark in

connection with the advertising of services intended to be “available at some time in the

future, but not yet available at the time of filing” does not qualify the mark for

registration. Id. at 535. Therefore, Cedar Point’s water park advertising campaign,

which was ongoing at the time the application was filed, was insufficient on its own to

support registration. Id. As a result, the TTAB held that the “applicant’s mark

‘OCEANA’ was not in ‘use in commerce’ . . . at the time of the filing of [the] application”

and that the application was thus void ab initio. Id. at 537.

2008-1154 14
 Interestingly, Cedar Point filed for its service mark roughly one month before the

scheduled opening of the new water park. Id. at 535. With the application date being

so close to the opening date, it is indisputable that Cedar Point had taken numerous

steps toward constructing the water park by the time the application was filed.

Nevertheless, the TTAB found none of these preparatory steps sufficient to satisfy the

use in commerce requirement.

The TTAB also addressed the use in commerce issue in the 1982 Greyhound

case. Greyhound, 214 USPQ at 473. In that case, the applicant, a life insurance

company, filed a service mark application in November of 1979. Id. at 474. Before the

filing date, the applicant advertised its services by disseminating informational letters

and posters using the service mark. Id. Despite this activity, the TTAB held that the

service described in the application was not rendered in commerce and thus declared

the application void ab initio. Id. at 475. The TTAB explained that “it is well settled that

advertising of a service, without performance of a service, will not support registration

. . . . The use in advertising which creates a right in a service mark must be advertising

which relates to an existing service which has already been offered to the public.” Id. at

474.

We find the reasoning of these cases persuasive. The language of the statute,

by requiring that the mark be “used or displayed in the sale or advertising of services,

and the services are rendered in commerce,” makes plain that advertisement and actual

use of the mark in commerce are required; mere preparations to use that mark

sometime in the future will not do. Thus, we hold that an applicant’s preparations to use

a mark in commerce are insufficient to constitute use in commerce. Rather, the mark

2008-1154 15
must be actually used in conjunction with the services described in the application for

the mark.

F. Analysis

As explained above, Mr. Aycock’s AIRFLITE service mark application can only

meet the use requirement if (1) his AIRFLITE mark was “used or displayed in the sale or

advertising of services,” and (2) his AIRFLITE service was either “rendered in

commerce” or rendered in more than one state or in this and a foreign country by a

person engaged in commerce. 15 U.S.C. § 1127 (2006). Because our determination

under the second element is dispositive, we will not address the issue of whether Mr.

Aycock’s advertising was sufficient to meet the first element of the service mark use

requirement.

In order to decide whether the second element is met, we must determine

whether Mr. Aycock ever gave an intended customer the opportunity to use his

AIRFLITE service. In other words, we must determine if Mr. Aycock made an open and

notorious rendering, or offering, of his service to the public. See Intermed, 197 USPQ

at 507. Upon review, we conclude that the TTAB’s determination that Mr. Aycock failed

to offer his service to the public is supported by substantial evidence, because he never

gave anyone an opportunity to use his AIRFLITE service to make a charter flight

reservation. Instead, Mr. Aycock merely took sporadic steps in preparing to offer his

service to the public.

Specifically, Mr. Aycock formed Aycock Engineering, which was the corporate

entity under which he intended to operate his AIRFLITE service. He also obtained two

toll-free telephone numbers that he planned to provide for potential customers seeking

2008-1154 16
to make flight reservations. The most notable step Mr. Aycock took toward offering his

AIRFLITE service to the public came when he contracted with the air taxi operators.

Under these contracts, air taxi operators agreed to participate in the AIRFLITE air taxi

network by being available to provide flights for customers using the AIRFLITE service.

These operators even paid modest initiation fees to Aycock in order to participate in the

service.

But these activities, even taken together, do not constitute a service that falls

within the scope of our definition of the recitation of services. As mentioned earlier, it is

our view that the service described in Mr. Aycock’s service mark application covers only

the arranging of flights between an air taxi operator and a passenger, and not

preparatory efforts to arrange a network of air taxi operators. The activities described

above, however, were merely preparatory steps that Mr. Aycock took toward his goal of

one day, as he described, operating a “communication service between persons

desiring to charter aircraft” that “put[] individuals desiring air transportation in contact

with people rendering that service.” J.A. 736, 749.

In order for Mr. Aycock to satisfy the use requirement, more was required. Mr.

Aycock had to develop his company to the point where he made an open and notorious

public offering of his AIRFLITE service to intended customers. See Intermed, 197

USPQ at 507. However, at no point in time did Mr. Aycock give a potential customer

the chance to use his AIRFLITE service. He never arranged for a single flight between

a customer and an air taxi operator. This is because Mr. Aycock, as stated in his

deposition, believed he needed at least 300 air taxi operators under contract before his

service could become operational. Reasonably, because he never had more than

2008-1154 17
twelve air taxi operators under contract at any one time, Mr. Aycock chose not to open

his doors to the public.

Furthermore, while the two toll-free telephone numbers he obtained could have

been used at some point in time as a means of offering the service to the public, they

were never actually used for this purpose. Nothing in the record suggests that Mr.

Aycock ever gave potential customers an opportunity to use the phone lines to make

flight reservations, or that a single customer seeking to book a flight actually called the

toll-free number. The record also fails to indicate that Mr. Aycock, or anyone else

associated with Aycock Engineering ever spoke with a member of the general public

about making a flight reservation through the AIRFLITE service.

That Mr. Aycock advertised to, contracted with, and was paid by air taxi

operators does not transform the service from its preparatory stages to being rendered

in commerce. Instead, these actions were Mr. Aycock’s attempts to build the service’s

infrastructure, which, when completed, could then be offered to the public (and thus

“rendered in commerce”).

Notably, Mr. Aycock set the goal of obtaining 300 air taxi operators by himself.

He had the option of attempting to run his AIRFLITE service with the air taxi operators

he had under contract when he applied for his service mark in 1970. Even though this

approach likely would have led to a much smaller and less profitable operation than he

originally intended, he could have met the use requirement had he taken this route. 11

11
The success or profitability of the service once it is offered to the public is
irrelevant in the use requirement analysis. Therefore, the use requirement can be met
when a service that was open for business immediately fails. This reasoning does not
apply, however, to services that failed during their preparatory stages and, as a result,
were never offered to the public. The use requirement is not met in such instances.

2008-1154 18
Even more, because Mr. Aycock filed his service mark application before 1989, he had

the “token use” option at his disposal. But he does not argue, and the facts do not

show, that he ever attempted to make a token use of his AIRFLITE service.

In sum, the activities that Mr. Aycock performed throughout the process of

building his AIRFLITE service at no point in time amounted to a rendering in commerce

of the service described in his application. In addition, the service was never rendered

in more than one state or in this and a foreign country by a person engaged in

commerce. Therefore, we hold that Mr. Aycock’s AIRFLITE service mark application

did not meet the use requirement when he filed it in 1970 and is thus void ab initio. 12

Further, Mr. Aycock failed to meet the use requirement during any of his additional

dealings with the USPTO that took place after 1970, including his 1994 renewal

application. 13

III. CONCLUSION

For these reasons, Aycock Engineering’s AIRFLITE service mark application

failed to meet the use requirement. Accordingly, the final decision of the TTAB

cancelling the registration of the AIRFLITE mark is affirmed.

12
We find it unfortunate that Mr. Aycock lost his AIRFLITE service mark after
the USPTO granted him a registration over thirty years ago. But under the federal
trademark and service mark registration system, no period of years exists beyond which
a mark holder becomes immune from invalidation under the use requirement. This
harsh reality may be offset by the common-law trademark doctrine, which provides a
mark user with rights even if that user did not file an application with the USPTO.
13
While the 1988 TLRA changed the use requirement registration
procedures by permitting “intent to use” applications, the applicant must still use the
mark in commerce at some point in time after that intent to use application is filed in
order to qualify for registration. See 15 U.S.C. § 1051(b), (d) (2006). Because Mr.
Aycock never used his service mark at any point in time in commerce, he would not
have met the use requirement in 1994, which was the year his renewal application was
granted.

2008-1154 19
 AFFIRMED

2008-1154 20
 United States Court of Appeals for the Federal Circuit

2008-1154
(Cancellation No. 92/032,520)

AYCOCK ENGINEERING, INC.,

Appellant,

v.

AIRFLITE, INC.,

Appellee.

Appeal from the United States Patent and Trademark Office, Trademark Trial and Appeal
Board, Canc. No. 92/032,520.

NEWMAN, Circuit Judge, dissenting.

Now, thirty-five years after federal registration of the service mark AIRFLITE and

thirty-nine years after Aycock’s first use of the service mark AIRFLITE, without any

objection or opposition to the registration in 1974 or its renewal in 1994, it is inappropriate

for the PTO to criticize its own description of the services and on this ground to invalidate

the registration as void when granted. The Trademark Trial and Appeal Board (TTAB)

considered no question of prior use, or confusion, or deception, or any other substantive

ground of invalidity. This registration was unchallenged for decades, until an apparent later

user, who selected the same word “Airflite” as its trade name for a different business,
brought this cancellation proceeding. The TTAB erred in reaching out to void this

registration on the questionable grounds that it adopted.

DISCUSSION

The TTAB found a flaw in the description of the services in the registration of the

mark AIRFLITE. The TTAB then redescribed the services, and found that the mark was not

used for the services as they were redescribed by the TTAB. However, the AIRFLITE

services when the mark was registered in 1974 were the same services as described

during prosecution of the application, the same services as when the Section 8 affidavit

was filed in 1980, the same services as when the registration was renewed in 1994. The

description in the registration, when finally granted after movement to the Supplemental

Register, was not perfect, but neither was it incorrect. The Board errs in now interpreting

the description as excluding the very services that were the basis of the registration. The

services for which the mark was registered were described during the examination, shown

in the specimens submitted with the application, and reasonably reflected in the description

that the examiner required. If indeed a flaw in the registration is now discovered, after

thirty-five years, it should be clarified and corrected, not voided ab initio. The cancellation

of this long-standing registration is seriously flawed, and is seriously unjust.

A

The ground on which the Board founded its decision was not raised by the petitioner,

and is not only incorrect but also was improperly considered by the Board. The Board held

that AIRFLITE was not a registrable service mark because Aycock was using the mark to

recruit air taxi operators, the Board ruling that this use did not constitute a registrable

service. This issue was not raised in the cancellation proceeding, was not briefed by either

2008-1154 2
party, and was not properly before the Board. The cancellation petitioner itself points out

this error, in its brief to this court:

The question of whether the activity of recruiting air taxi operators and
signing them to contracts to carry passengers in accordance with
reservations arranged through Aycock was a service for which a service
mark would be registrable was not pleaded or tried at the Trademark Trial
and Appeal Board.

Appellee Br. 13-14. The Trademark Board Manual of Procedure, at §314, prohibits reliance

by the Board on an unpleaded issue in cancellation proceedings, for the registrant is

entitled to know the grounds to which it must respond. Yet this prohibited procedure

underlies the Board’s decision voiding Aycock’s registration.

Having improperly considered this ground, the Board further erred by ruling that

Aycock’s AIRFLITE service does not meet the requirement that a registrable service “must

be performed to the order [of], or for the benefit of, someone other than the applicant.”

Airflight, Inc. v. Aycock Eng’g, Inc., Cancellation No. 92/032,520, 2007 WL 2972237, at *5

(TTAB 2007) (quoting Trademark Manual of Examining Procedure (T.M.E.P.) §1301.01(a)).

The Board ruled that only benefit to air passengers could support registration of AIRFLITE,

and found that without sales to passengers, Aycock’s ongoing activity of forming a network

of air taxi operators benefited only Aycock. This finding is clearly incorrect, for the air taxi

operators who entered into contracts with Aycock, paying a fee, obviously had their own

benefit in mind.

After improperly ruling that the service of providing a network of air taxi operators

cannot support a registrable service mark, the Board held that the description of services in

the AIRFLITE registration requires the booking of flights in airplanes. The TTAB held that

since no individuals had booked flights in Aycock’s network, Aycock was not performing the

2008-1154 3
service described in the registration, and cancelled the registration. My colleagues on this

panel appear to agree with the Board that the registration requires the transportation of

passengers, and thereby define the registration into invalidity. However, the Lanham Act

was designed to support the marks of commerce. See, e.g., In re Adver. & Mktg. Dev.,

Inc., 821 F.2d 614, 618 (Fed. Cir. 1987) (quoting Am. Int’l Reinsurance Co. v. Airco, Inc.,

570 F.2d 941, 943 (CCPA 1978)) (in the Lanham Act “the term ‘services’ was intended to

have broad scope” and “no attempt was made to define ‘services’ simply because of the

plethora of services that the human mind is capable of conceiving”). The definition should

be construed to support the registration, when it is reasonable to do so.

In addition to its irregular procedure, the Board is incorrect in substance, for the

service of recruiting air taxi operators and contracting with them is indeed a registrable

service. It is not disputed that this activity was performed in commerce, and accorded with

the service mark statute as then written (and today is substantially the same):

For purposes of this Act a mark shall be deemed to be used in commerce . . . (b) on
services when it is used or displayed in the sale or advertising of services and the
services are rendered in commerce, or the services are rendered in more than one
State or in this and a foreign country and the person rendering the services is
engaged in commerce in connection therewith.

15 U.S.C. §1127 (1970). The specimens filed with the application show display of the mark

AIRFLITE in Aycock’s advertising of its services to air taxi operators nationwide, and the

record states that Aycock obtained contracts with about a dozen air taxi operators. Mr.

Aycock testified that this is far fewer than the number that he needs, and that the business

has not progressed as he had hoped. However, there was no finding of discontinuance or

abandonment of the activity. Slow commercial progress, or absence of income or profit, is

not a ground of cancellation of registration. See generally United We Stand Am., Inc. v.

2008-1154 4
United We Stand, Am. N.Y., Inc., 128 F.3d 86, 92 (2d Cir. 1997) (use in commerce under

the Lanham Act is not limited to profit-seeking uses). The Lanham Act authorizes

cancellation of abandoned marks, but a mark is not abandoned because the proprietor is

encountering difficulties in the business.

The Board relied on TTAB decisions relating to services not yet rendered, to support

the Board’s position that Aycock had not used AIRFLITE in commerce. For example, in In

re Cedar Point, Inc., 220 USPQ 533 (TTAB 1983), the applicant was found not to have

used the mark OCEANA for a “marine entertainment park” because the park had not yet

opened, and the Board held that advance publicity was not use in commerce. However,

Aycock had used AIRFLITE to implement the network of air taxi carriers; Aycock was not

engaging in advance publicity, but was performing the registered service, for Aycock made

“an open and notorious public offering of the services to those for whom the services are

intended.” Intermed Commcn’s, Inc. v. Chaney, 197 USPQ 501, 507 (TTAB 1977).

B

The prosecution history shows the genesis of the imperfect description in the

registration. In the initial application filed on August 19, 1970, the AIRFLITE services were

described as “a communication service between persons desiring custom air travel and

certified air taxi operators,” and the applicant requested registration in Class 101,

“Advertising and Business.” J.A. at 731. The specimens showed the mark AIRFLITE

displayed in a document directed to air taxi operators, pointing out the advantages to the

operators of the service provided by AIRFLITE and inviting their participation. The

trademark examiner rejected the application on the ground that the word AIRFLITE was

2008-1154 5
“merely descriptive,” objected to the description as indefinite, and suggested that the

services be described as “airplane reservation services.” J.A. at 735.

Aycock in response objected to the examiner’s suggested description, and proposed

“a communication service between persons desiring scheduled and unscheduled airplane

reservation services and certified air taxi operators.” J.A. at 736. The examiner rejected

this proposal, stating, “The mere fact that applicant communicates with people does not

mean that it offers a communication service.” The examiner stated that the application

should be amended to describe the service as “arranges charter air flights.” The examiner

also objected that the mark was “highly descriptive,” and proposed reclassification into

Class 105, “Transportation and Storage.” J.A. at 741. Aycock responded that his service

did not charter whole aircraft, but arranged for individual seat reservations on chartered

flights, and offered to further amend the description to “a communication service between

persons desiring scheduled and unscheduled airplane reservation services and certified air

taxi operators in the locale in which the charter is desired to originate.” The examiner

rejected the offer, and issued a final refusal of registration. The examiner also maintained

that Class 105 was the proper classification.

Aycock filed an appeal with the Trademark Trial and Appeal Board. Then, after

discussion with the examiner, Aycock agreed to transfer the application to the

Supplemental Register, and the TTAB remanded for further prosecution. Aycock again

explained that the service with which the mark is used “is not a service of arranging charter

aircraft but rather is the arrangement of transportation on a per seat basis from one point to

another, with the local aircraft operator, under his own trademark whatever it may be, to

actually do the flying.” J.A. at 745. After fairly extensive further exchanges, Aycock

2008-1154 6
acquiesced in the final description “arranging for individual reservations for flights on

airplanes” and also acquiesced in the reclassification into Class 105. This description,

whose flaws are now apparent, was the basis of the Board’s ruling that unless there were

actual passenger reservations, the mark was not in use in commerce.

My colleagues agree. However, it is inappropriate now to construe the description of

AIRFLITE services as excluding the integral component of making arrangements with air

taxi operators. This was the use described in the specimens filed with the application, and

was persistently, but fruitlessly, explained to the examiner throughout the prosecution. I do

agree that the applicant as well as the examiner offered less than perfect definitions, over

this lengthy prosecution. However, as a matter of sound trademark law and fair trademark

practice, it is inappropriate now to construe the registration so as to exclude the actual use

of the mark as was explained in the examination, shown in the specimens, and fully

explored in the public record of the prosecution.

Few administrative proceedings are perfect, although in the hindsight bred of

litigation much can be made of flaws. Here there is no material violation of law, no harmful

error, no doubt as to the services for which registration was requested and granted. It is

unfair to penalize the applicant for flaws for which there was at least a shared responsibility,

for the trademark examiner does not appear to have scrupulously adhered to the

requirement of the Trademark Manual of Examining Procedure §1402.01(a) (“Deference

should be given to the language and the classification set forth by the applicant in the

original application.”). Precedent concerning the interpretation of imperfect descriptions is

sparse, for if such issues arise, they can normally be remedied without litigation. The panel

majority cites two cases that favor narrow construction of the description of services, In re

2008-1154 7
Shell Oil Co., 992 F.2d 1204, 1207-08 (Fed. Cir. 1993), and Octocom Systems, Inc. v.

Houston Computer Services, Inc., 918 F.2d 937, 942 (Fed. Cir. 1990). Both of these cases

relate to the effect of the description on likelihood of confusion between competing

applicants—an issue unrelated to anything relevant to this appeal.

Based on its origin in the common law of trademarks, the Lanham Act has

traditionally been applied to support the commercial activity that is implemented through the

marks of trade, with liberal opportunity to correct errors. It is a negation of these principles

now to hold that the AIRFLITE registration of thirty-five years was void from the start,

because the applicant acquiesced in a prosecution description that is now susceptible to

misconstruction. It is incorrect to construe the description in a manner that invalidates it by

ignoring the actual services that were performed. I must, respectfully, dissent from this

court’s endorsement of the TTAB’s departure from its obligation to sustain the registered

marks of commerce when it is reasonable to do so.

2008-1154 8