Holding: The zone of natural expansion doctrine allows a senior user to prevent a junior user from registering a similar mark for goods or services that are reasonably expected to emanate from the senior user’s business. However, this doctrine does not give the senior user a proactive right to establish priority for those goods or services when registering its own mark.
Dollar Financial owns two trademarks for the use of MONEY MART in connection with loan financing and check cashing businesses with a date of first use in 1984. In 2010, Dollar Financial expanded its business at certain MONEY MART stores to include pawn brokerage and pawn shop services. In 2013, Dollar Financial registered US Registration No. 4,524,540 for MONEY MART and US Registration No. 4,532,073 for a design mark featuring the text MONEY MART, both listing “pawn brokerage and pawn shops” among the covered services.
Since the 1990s, Brittex has operated pawn shops in Texas under the names “MONEY MART PAWN” and “MONEY MART PAWN & JEWELRY.” Brittex had never registered these marks but has common law rights. Brittex petitioned to cancel Dollar Financial’s registrations arguing likelihood of confusion. The TTAB denied the petition to cancel, reasoning that Dollar Financial had priority to the MONEY MART mark, since it had been using the mark for loan financing services since the 1980s, and loan financing service encompass pawn services. The Federal Circuit remanded on appeal, holding that loan financing was only covered by pawn brokerage, and not by pawn shop services. On remand, the TTAB found a likelihood of confusion and that Brittex had priority.
On appeal, Dollar Financial argued that the zone of natural expansion doctrine should be invoked to establish that they have priority to the MONEY MART mark. The zone of natural expansion doctrine states that a first user of a mark for certain goods and services has superior rights over a subsequent user for any goods or services which purchasers might reasonably expect to emanate from the normal expansion of the first user’s business. According to Dollar Financial, pawn services may be reasonably expected to emanate from loan financing services; therefore, Dollar Financial should be able to rely upon its earlier marks for loan financing services to establish priority for pawn services. However, the Federal Circuit upheld the TTAB’s decision to not invoke the zone of natural expansion doctrine. This doctrine is a defensive doctrine that may be used to prevent a junior user from registering similar marks on goods in a senior user’s zone of natural expansion. However, this doctrine does not give the senior user a proactive right to the register the mark. For example, the zone of natural expansion doctrine cannot be used by a senior user to establish priority in its own later filed application, particularly when this application would conflict with the prior use of another user.
Dollar Financial also argued that the TTAB should have analyzed its registrations under the doctrine of tacking. Tacking allows a trademark owner to make certain modifications to its mark while still maintaining the same priority as the original mark. For example, tacking is allowed when two marks make the same, continuing commercial impression, and the goods and services are substantially identical. Goods and services are substantially identical when the new goods and services are within the normal evolution of the old goods and services. However, in this case, Dollar Financial did not assert a tacking defense before the TTAB, so this argument was forfeited on appeal to the Federal Circuit.
After going through the TTAB’s analysis of the DuPont factors, the Federal Circuit upheld the determination of a likelihood of confusion between the Dollar Financial and Brittex marks. In particular, the Federal Circuit upheld the TTAB’s decision that the ninth DuPont factor, which states that if a plaintiff uses its mark on a wide variety of goods, then a purchaser is more likely to view the defendant’s related goods under a similar mark to be an extension of the plaintiff’s line, is purely defensive and can only be used to prevent registration or use of a mark. Dollar Financial also argued that the TTAB had failed to consider that Dollar Financial owns two incontestable registrations for the identical mark in connection with virtually identical goods. However, because the previous Dollar Financial registrations do not mention pawn shops or pawn services, the Federal Circuit found no error in not considering these earlier registrations.
Federal Circuit Precedential 
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