You say, "Given that I'm just starting, would prefer not to challenge the mark." But that is exactly what your are doing with your approach. If the registration is valid in the USPTO and the Section 8 was filed and accepted, an examiner will not allow you to register your mark if confusingly similar with the allegedly fraudulent, earlier registration. In that case, your only option to register your mark would be to file a cancellation action in the Trademark Trial and Appeal Board at the USPTO to cancel the earlier registration. Maybe the registrant won't defend that if they truly aren't using the mark but you're still talking about a legal proceeding of some extent, attorneys fees, etc. You are strongly advised to not try this on your own because there are a number of technical procedures to follow and legal issues that can snag you.
If the mark truly is not being used by the registrant, then yes, you do have an arguably defensible position and may be able to acquire rights in the mark but be careful about what you consider "use." A mark can be "used" on a product by being offered in ordinary Commerce and traveling through interstate commerce but not ever sold - at least sufficiently to earn that registrant some potentially defensible rights in the mark. If the mark is being used, or there was use, there is now a gap in use and the registrant can demonstrate an intention to resume use, the registrant may be able to maintain their rights in the mark.
Ultimately, any allegation of fraud to cancel the registration, or any claim of nonuse of the mark as a basis for cancelling the registration will require affirmative legal action on your part that you must pay for. If you simply use the mark without registration and the registrant claims you are infringing, you again must affirmatively prove your case that you are entitled to the mark based upon the registrant's alleged abandonment of the mark.
I think your only option with the least resistance and the least anticipated legal expenses is if you just start using the mark, acquiring use rights and the registrant takes no action and allows you to keep using the mark (presumably because they are not using the mark and don't care to invest in maintaining or defending it). But if this is the case, why couldn't you just approach this registrant, express your interest in the mark and see if he/she will 1) simply convey the mark to you; 2) voluntarily surrender it; or 3) issue you a consent to register the mark and use it (in that order of preference for you)? Even if you have to purchase this mark, you likely could purchase this mark from this registrant for the same or less money than an attorney will cost you to go through the legal procedures of alleging fraud or abandonment or defending your use/registration of the mark for same.
All said, you see that there are a lot of facts and strategy to consider and you really need to retain a qualified trademark attorney if you truly want to successfully and economically accomplish what you mention above.
Alex Butterman is a trademark attorney with Staas& Halsey LLP (http://www.staasandhalsey.com), a Washington, D.C. IP boutique law firm. Alex is admitted to the bars of Washington, D.C., New York and New Jersey but, unless otherwise specified, the answer is intended to be general enough to apply to any U.S. state and based primarily upon his knowledge and experience with applicable federal laws. The opinions expressed are those of the author and do not necessarily reflect the views of his firm, Avvo or other attorneys. This answer is for general information purposes only and is not intended to be and should not be taken as legal advice. No attoreny-client relationship or obligations are established herein, although consulting an attorney to discuss your specific situation is strongly recommended. This is especially true of trademark law and probably any area of intellectual property law because TM law is so fact-specific and full of esoteric nuances and exceptions, that more often than not there does seem to be harm in handling a trademark matter without consulting an experienced trademark attorney.
It's a risky aproach. Relying on a public forum of lawyers without a personal attorney to discuss details with is even riskier. I counsel my clients to retain me not to "win in court" but to save their money, focus and energy for their commercial goals.
The above is general legal and business analysis. It is not "legal advise" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here.
There are some assumptions here that need to be examined before advice could be given. Are the products the same? If not, is the "new product" in a field that the "old product" might enter? Are the distribution channels similar? There are lots of registered trademarks that have multiple marks that are not confused with each other.
I know that money is probably at a premium, but you need to have a lawyer who knows this area of the law.
www.bayoaklaw.com. 510-208-5500. This answer does not create an attorney-client relationship. It is not legal advice, because it is only of a general nature. Please contact a lawyer qualified in your jurisdiction to discuss your situation in confidence, using your factual details. Avvo answers are only general legal responses. Item 9 of Avvo.com's Terms and Conditions are incorporated in this disclaimer as though it were printed here.