Trademark Trial Appeal Board & Infringement Lawsuits
Trademark Trial Appeal Board (TTAB) – In B&B Hardware v. Hargis Industries the United States Court of Appeals for the Eighth Circuit ruled on a contentious case of trademark infringement litigation that had been going on for over fifteen years. One of the central issues was the very, very interesting role of decisions made by the Trademark Trial Appeal Board (TTAB) which is an adjudicatory branch of the United States Patent and Trademark Office (USPTO.)
Background of the Case
Plaintiff B&B makes a type of fastener device used in the aerospace industry that it sells under the brand “Sealtight.” Defendant Hargis makes a type of self-drilling, self-taping screw in widespread use in the construction industry that it sells under the brand “Sealtite.”
The procedural history of the case was somewhat complex but may be summarized as follows. B&B sued Hargis for trademark infringement and unfair competition under the Lanham Act. Hargis counterclaimed for false advertising and false designation of origin. At trial, a jury ruled against B&B on all counts and also granted Hargis’ counterclaims, effectively a total victory for Hargis.
B&B’s Grounds for Appeal
B&B appealed the jury verdict based on a decision made by the Trademark Trial Appeal Board. In 2007, the Trademark Trial Appeal Board denied Hargis’ attempts to register its “Sealtite” brand as a trademark, citing a likelihood of confusion with B&B’s “Sealtight” mark.
B&B put forth two major lines of argument. First, it argued that the TTAB decision should have “preclusive effect” on the issue of likelihood of confusion. In effect plaintiff argued that the jury should not have been able to decide the issue of likely confusion because the issue was already decided or “precluded.”
B&B’s second argument was that, even if arguendo, the preclusive effect argument failed, it was an error by the District Court to exclude evidence of the TTAB decision from being considered by the jury.
Both these arguments were quite interesting, and their resolution provided for a relatively clear standard for the applicability of Trademark Trial Appeal Board decisions to trademark lawsuits.
Judicial Analysis: “Preclusive Effect”
The preclusive effect argument was based on a legal theory known as “collateral estoppel.” Essentially, under this theory, a party may not re-litigate an issue that was previously decided by a competent adjudicating body. Plaintiff argues that the TTAB was such an adjudicating body that decided the issue of likelihood of confusion.
The 8th Circuit resoundingly defeated this argument. Under principles of administrative law, the TTAB may or may not be a valid adjudicating body that may be granted deference by the court system. Different jurisdictions vary in their treatment, and the 8th Circuit stopped well short of articulating a clear rule. However, there is another element of collateral estoppel that was not met here.
Under the CE doctrine “the issue sought to be precluded must be the same as the issue involved in the prior action.” Inherent in this question was the evidentiary standards used in making the TTAB decision of trademark cancellation versus the evidentiary standards that would be used in a Trademark lawsuit. The 8th Circuit found that the TTAB used only six of the thirteen factors articulated in the E.I. Dupont DeNemours standard of confusion. However, the 8th Circuit uses a different standard: the SquirtCo six-factor test! Because these two standards were non-identical, collateral estoppel failed on the identity-of-issue factor.
Judicial Analysis: Admissibility of TTAB Decision
A Court may exclude any evidence if it may unduly confuse or prejudice the jury in excess of its probative value. Here the District Court felt that admitting the TTAB decision as evidence would cause a great deal of confusion to the jury and be misleading – stating the difference between the 8th Circuit test and the TTAB test discussed above. The District Court had a large amount of discretion to exclude evidence, and the 8th Circuit ruled that the concerns about jury confusion were more than sufficient to exclude the TTAB decision.
Conclusion
This case was a great cautionary tale that TTAB decisions may or may not carry weight in court. If you intend to undertake trademark litigation it is imperative to hire counsel who is familiar with the relevant legal standards in your jurisdiction and how they may differ from the standards used by the TTAB.
Contact Cartee, LC Today
If you need assistance with a trademark, copyright, IP issue, or related business matter, call Orange County Trademark attorney Anthony Cartee today at (714) 942-2225 or contact us online.
