A company that wants to expand into new regions, sectors, lines or brands should insist that a co-existence agreement be concluded instead of an approval agreement. This allows the company to address the potential risks they are likely to become visible in the future and pave the way for more favourable growth. An approval agreement merely authorizes the current use, without worrying about the inevitable development of trademarks. Since those who are most familiar with market use and have the greatest interest in avoiding confusion enter into agreements to avoid them, the scales of evidence are clearly tilted. It is difficult, to say the least, to maintain the subjective view that there will be confusion if those directly involved say that this will not be the case. The mere assumption that confusion is likely will rarely be imposed against uncontested evidence from people in the line of sight that it is not. A brand co-existence agreement should contain the following: In the ongoing brand wars between brewers for names, even though two competing brewers have reached an agreement, the USPTO has said “no.” The TTAB decided that an approval agreement in which “competitors clearly conceived their business interests” was very important and that the examiner should not replace his judgment on the risk of confusion between two brands with the assessment of the parties of real interests. As a result, TTAB rescinded the refusal to register the AMERICAN CONSTELLATION trademark. While this decision in itself is not the death of approval contracts, the title has certainly caught your attention! There is a good reason to take a closer look at this case, particularly with a TTAB case last year, in which Bay State Brewing Co. Inc.`s application was rejected by the TTAB despite a similar approval agreement.
In this case, TTAB found that Bay State had not been able to register the “Time Traveler Blonde” mark because of its resemblance to the existing registered mark “Time Traveler”, although it obtained consent to the contrary and a co-existence agreement (In re Bay State Brewing Company, Inc., reference number 85826258, with the Trademark and Appeal Board of the U.S. Patent and Patent Board (February 2016)).