Lack of Bona Fide Intent to Use Sends Alcohol Trademark Application Down the Drain

In a recent precedential decision, the U.S. Trademark Trial and Appeal Board (TTAB) upheld an opposition by Tequila Cuadra S. de RL de CV (“Tequila Cuadra”) and denied an application filed by Manufacturera de Botas Cuadra, S.A. de C.V. (“Botas Cuadra”) for the mark CUADRA for alcoholic beverages except beer, including tequila in particular. Tequila Cuadra S. de RL de CV v. Manufacturera de Botas Cuadra, S.A. de C.V., No. 91282327 (TTAB May 8, 2025). Tequila Cuadra claimed prior common law rights in CUADRA for alcoholic spirits, but the case was ultimately decided on lack of a bona fide intent to use the mark at the time of filing.

When making such a challenge, an opposer must first establish by a preponderance of the evidence a prima facie case that the applicant lacked a bona fide intent at the time the application was filed. The burden then shifts to the applicant to demonstrate that such intent existed. An applicant’s intent may not be demonstrated based merely on subjective “say so,” but must be corroborated with objective evidence of specific facts and actions.

Tequila Cuadra met its initial burden by showing that Botas Cuadra:

1. Had no documentary evidence (such as business plans, formulas, communications with third parties, etc.) to support its allegation of a bona fide intent at the time the application was filed
2. Had not communicated with either the regulatory authority in Mexico that controls the production of tequila or the regulatory authority in the United States that approves labeling of alcoholic beverages
3. Used “CUADRA” tequila bottles as mere props in promotional materials for unrelated footwear and clothing
4. Even if wine making entities commonly owned by the Cuadra family had the capacity to produce tequila in Mexico, there was no communication with such entities regarding the production of tequila for the U.S. market

In response, Botas Cuadra offered testimonial declarations of its chief financial officer and the general manager of a commonly owned winery, as well as photographs showing CUADRA-branded bottled tequila as they appeared in promotional materials for its footwear and clothing, as shown on page 18 of the TTAB decision. Likewise, a CUADRA-branded bottle has appeared in social media posts and webpages for one of its commonly owned wineries, as shown on page 19 of the TTAB decision.

The TTAB did not find this evidence sufficient to overcome Tequila Cuadra’s prima face case that Botas Cuadra lacked a bona-fide-intent to use the CUADRA mark for alcohol. In particular, the TTAB agreed that the bottles in the promotional materials and social media posts (with Spanish-only labeling) appeared to be props used in the advertisement of unrelated goods. There was no evidence that consumers would perceive alcoholic beverages as a natural expansion of footwear or clothing products. The TTAB also noted that there was no evidence the social medial posts were viewed within the U.S. Moreover, the social media posts were not from Botas Cuadra, but rather a commonly owned winery.

Botas Cuadra also argued, relying on prior decisions, that its capacity to produce alcohol (via commonly owned wineries) was strong evidence of its bona fide intent, even in the absence of specific documents. The TTAB disagreed, noting that none of the commonly owned wineries was shown to have produced alcohol for sale in the U.S., nor was there any evidence of communications with such wineries discussing such a plan. The TTAB also stated that even if CUADRA-branded alcoholic beverages were intended to be or were produced for sale in Mexico, that fact alone would not establish a bona fide intent to use the mark in the U.S.

Though not critical to its decision, the TTAB also implied in a footnote that even if Botas Cuadra were to offer alcoholic beverages in U.S. commerce — but only in the marketing and promotion of its clothing-related products, thereby being “associated with” such products — it was not clear that the alcoholic beverages themselves would be “goods in trade” for which a trademark registration could be issued. This is perhaps a bit puzzling, as there is a long history of registered marks used only for promotional items such as coffee mugs, pens, or calendars, so long as the goods have a function standing on their own.

Takeaways

Sometimes established companies in a particular industry may rely on their general production capacity and experience in marketing particular goods in the U.S. to demonstrate a bona fide intent to use a mark even in the absence of specific documents corroborating such intent. However, for many trademark applicants, the prudent course remains documenting intent before filing a trademark application. Documentation could include, for example, business plans or communications with manufacturers, distributors, or regulatory authorities. Even if the intent in filing an application is not the impermissible hope of merely reserving rights in a mark without having a verifiable bona fide intent to use the mark, the application — and any ensuing registration — may be at risk if challenged.