In Bose Corporation v. QSC Audio Products, Inc., the United States Court of Appeals for the Federal Circuit examined the nature and extent of evidence necessary to establish a trademark as "famous."

Bose opposed QSC's application to register the mark POWERWAVE for "amplifiers and power amplifiers," alleging confusing similarity with its registered marks WAVE and ACOUSTIC WAVE for loudspeakers, compact stereos, radios and related products. In addition to claiming similarities in the marks, the goods and their channels of trade, Bose sought to establish its marks as "famous." Under U.S. law, trademarks that enjoy extensive public recognition and renown (i.e., fame), are afforded a particularly wide ambit of protection. When present, the fame of a prior mark can play a dominant role in a likelihood of confusion analysis by reducing the level of similarity between marks/goods required to find confusing similarity.

In support its claim of fame, Bose submitted sales and advertising figures for its two registered marks. With respect to its ACOUSTIC WAVE products, Bose cited annual sales averaging $50 million/50,000 units over 17 years, with an advertising budget averaging $5 million annually. For its WAVE product Bose claimed annual sales of $100 million/200,000 units since 1993, with cumulative advertising expenditures of $60 million. Bose also submitted examples of use of its marks on packaging and nationwide advertising, as well as numerous reviews and articles from national media assessing the quality of its marked products.

The Trademark Trial and Appeal Board dismissed the opposition based primarily on a conclusion that Bose failed to prove the fame of its two marks. The Board's three-point analysis noted first that Bose produced no direct evidence of consumer recognition of the fame of the marks, i.e., results of consumer surveys. Second, the Board stated that Bose's evidence of use did not support the independent fame of the WAVE and ACOUSTIC WAVE marks since the marks often appeared in combination with the famous BOSE house mark. Lastly, the Board deemed Bose's sales and advertising evidence unpersuasive on the ground that the figures were not placed in a context from which to determine their substantiality vis-a-vis similar types of products. The Board disregarded entirely the numerous third party references to the Bose WAVE and ACOUSTIC WAVE products.

The Court of Appeals for the Federal Circuit reversed the Board's decision, holding that the Board erred by failing to accord fame to the Bose marks. As to the absence of survey evidence, the Court confirmed that direct evidence of consumer awareness is preferable to indirect evidence. However, the Court noted that the absence of such evidence cannot establish lack of fame, particularly since virtually all prior holdings attributing fame to a mark were accomplished solely through indirect evidence such as a high volume of sales and advertising over a long period of time.

With respect to the Board's second point, the Court agreed that the marks must be shown to have independent trademark significance apart from the fame of the associated house mark. However, the Board failed to properly consider the nature and context of Bose's use of the marks, as well as the strength of the public reputation of the marks independent from the house mark. While acknowledging the extensive presence of the BOSE mark on packaging and advertising, the Court also noted frequent references to the WAVE and ACOUSTIC WAVE marks standing alone and apart from the famous house mark, particularly on order forms and invoices. The Court also placed particular significance on third-party articles and reviews identifying the products separately from the BOSE mark. Based on this combination of evidence, the court concluded that sufficient opportunity existed for consumers to disassociate the product mark from the house mark.

Lastly, the Court held that the Board improperly rejected Bose's evidence of sales and advertising expenditures relating to its marks. Notwithstanding the lack of contextual evidence, the Court stated that the figures adequately illustrated both the vast number of purchases that have been made of the marked products, and the extent to which the public has been exposed to advertising of such products. In addition, the Court stressed that the evidentiary value of the sales and advertising figures was bolstered by continuous and extensive positive media coverage of the products. To illustrate its point, the Court cited the ROLLS-ROYCE mark for automobiles, which it held warrants fame in the public's eye by virtue of general reputation, even though sales and advertising relating to the mark are inconsequential as compared to other automobiles.

Based on its analysis, the Court concluded that Bose's marks were famous and, therefore, entitled to the broad scope of protection available to such marks. Upon reconsideration of similarities in the marks and goods in light of this fame, the Court found the mark POWERWAVE to be confusingly similar to the registered marks WAVE and ACOUSTIC WAVE and sustained Bose's opposition to QSC's application.