Decades-Long Soda Trademark Dispute Ends After Federal Circuit Ruling

A Federal Circuit appellate panel ended a 13-year dispute between soda companies Wednesday over the trademark registrability of the term “ZERO” when attached to the names of sodas or energy drinks. The plaintiff creators of RC-Cola, Sprite, and Dr. Pepper argued that Coca-Cola could not trademark beverages like “Coke Zero” without a disclaimer on the labeling saying that Coca-Cola does not own the trademark for the word ZERO when used in connection with the company’s soda or energy products because the term was too generic to be eligible for a trademark. The Federal Circuit permitted Coca-Cola to disclaim ZERO, ending the dispute.

The plaintiffs challenged Coca-Cola’s use of the word ZERO in conjunction with 16 beverages including Coke Zero, Pibb Zero, and the energy drink Vault Xero. In the initial challenge brought at the time of Coca-Cola’s trademark application, the plaintiffs sought denial of the trademark registration by arguing that “ZERO is generic for zero-calorie products in the genus of soft drinks, sport drinks, and energy drinks.” The Trademark Trials and Appeals Board disagreed and held that the defendant successfully proved that ZERO had acquired distinctiveness when used in conjunction with sodas, but not energy drinks.

The plaintiffs then appealed the decision of TTAB to the Federal Circuit. In the initial appeal, the court “vacated the decision of the Board [due to the Board’s application of] the wrong legal standard for genericness of the term ZERO and for failing to make a finding on the term’s descriptiveness before addressing acquired distinctiveness.” The court then remanded to the TTAB for review of the ZERO mark under the proper legal standards. However, prior to analysis on remand, Coca-Cola filed a motion to disclaim the mark, which TTAB granted.

Under federal law, to disclaim a mark is for the defendant to say that while ZERO is used in conjunction with something like COKE ZERO, the defendant does not maintain a trademark for the stand-alone word of ZERO. This disclaimer meant that the plaintiffs could continue their use of ZERO on their own products, like Dr. Pepper Zero and RC Cola Zero, without violating the trademark of Coca-Cola. Royal Crown and Dr. Pepper challenged this motion on the grounds that it violated their ability to get a proper determination on the merits. For the plaintiffs, the Board’s failure to determine whether ZERO was generic overall (and thus not eligible for trademark protection generally) meant that the defendant could simply file another set of trademark applications using the word ZERO in the future.

On the second appeal, the appellate panel at the Federal Circuit acknowledged the logic of the plaintiffs but ultimately held that the TTAB’s actions were legally sound. According to the associated opinion, the plaintiffs still acquired their ultimate goal, namely, the ability to continue using the word ZERO on their own products without concerns of trademark infringement. The court further ruled that while the plaintiffs’ proffered risk that Coca-Cola could simply file another trademark application stood as a sound concern, that “such an interest is too speculative to invoke the jurisdiction of this court.” The court concluded by holding that, “litigation is conducted for the purpose of obtaining relief, not an advisory opinion.”