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Supreme Court Finds Trademark Trial and Appeal Board Decision Can Have Preclusive Effect in Litigation

Posted on Mar 25, 2015 in Blog

The Supreme Court on March 24, 2015 decided that rulings of the Trademark Trial and Appeal Board (TTAB) of the U.S. Patent and Trademark Office as to likelihood of confusion are binding on District Courts. In B&B Hardware v Hargis Industries, B&B had prevailed in a trademark opposition proceeding before the Trademark Trial and Appeal Board. The Board found that Hargis’ trademark SEALTITE was likely to be confused with B&B’s trademark SEALTITE and refused to register the mark of Hargis. Hargis did not appeal. B&B then sued for trademark infringement in a federal district court. In both cases, the issue of registrability of the mark and the issue of infringement rely on whether there is a likelihood of confusion between the marks. The Supreme Court ruled that a federal court should give preclusive effect to TTAB decisions in such situations where you have the same parties and same issues involved.

The ruling has some important implications. One is that if you think a TTAB ruling is wrong, you should consider appealing. In this respect an appeal may not only be made by filing an appeal to the Court of Appeals for the Federal Circuit it may also be taken by filing a district court action. A district court action enables the losing party to have the issue reviewed again. Also, it means that Opposition and Cancellation proceeding should be taken as seriously as civil actions in a U.S. District Court. In addition, although Judge Alito carefully limited the ruling to the facts in the case, he also stated “when the usages adjudicated by the TTAB are materially the same as those before the district court, issue preclusion should apply”. Thus, there may be no reason not to apply issue preclusion in a subsequent district court action (not an appeal) if the TTAB has ruled on an issue in which the parties both put in evidence anything that it could put into evidence at trial. For example if the TTAB finds that a mark is not descriptive, the finding of the TTAB may prevent that issue being raised again between the same parties with respect to that same mark provided that the parties, evidence and legal requirements for finding a mark descriptive are the same in both tribunals.

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