Illinois Church Adds Zeros to Adidas' Legal Bills

Illinois Church Adds Zeros to Adidas' Legal Bills

After some bruising encounters with United States trademark law, Adidas SA recently found itself on the ropes again, this time at the hands of a church in Zion, Illinois. The marks in question are a study in phonics: 

ZAGREB , CROATIA – 19 FEBRUARY 2015 – Close up logo of sport brand Adidas printed on textile , product shot

ADIZERO running shoes by Adidas vs. ADD A ZERO hats by Christian Faith Fellowship. 

In 2005 a small congregation by the name of Christian Faith Fellowship, based in Zion, Illinois, registered a wordmark and a logo mark with the United States Patent and Trademark Office for hats emblazoned with the phrase “ADD A ZERO.” The hats were not a big seller, with only two of them recorded as being sold-critically, with one being paid for by a check drawn on a Wisconsin bank.

In 2009, Adidas was ready to roll out its new, lightweight running shoes, which it dubbed “ADIZERO.” Upon petitioning the USPTO for protection, Adidas’ claim was denied based on the the existence of Christian Faith Fellowship’s prior registration. The USPTO found there to be a likelihood of confusion.

Adidas appealed this decision to the Trademark Trial and Appeal Board (TTAB), arguing that Christian Faith Fellowship’s hats are not a source identifier and that they had sold a very limited number of the hats without showing any significant use in commerce which generally denotes interstate commerce. Christian Faith Fellowship then produced the Wisconsin bank check mentioned earlier, claiming that it indeed had engaged in interstate commerce, even if only for two sales. The TTAB ultimately decided in favor of Adidas, citing the small number of hats that were sold.

Christian Faith Fellowship appealed the TTAB’s decision and found itself battling Adidas before the Federal Circuit. In an effort to get the case thrown out, Adidas argued for a de minimis exception because only two hats had been sold, and Christian Faith Fellowship did not truly engage in interstate commerce. Its argument was denied and the court went on to nullify the TTAB’s decision because case law was clear that the sale of two hats was sufficient to establish interstate commerce.

The circuit court remanded the case back to the TTAB where it is currently under review.

This case is interesting because many practitioners disagree with the Federal Circuit’s ruling. They say it sets a very low standard for interstate commerce and sets up too many obstacles for large producers of trademarked products. What’s your ruling?