The Supreme Court recently decided a rare trademark case, which trademark owners should consider when prosecuting or defending proceedings before the administrative law arm of the Patent and Trademark Office, the Trademark Trial and Appeal Board.
In summary, one no longer can get two bites at the likelihood of confusion apple.
In B&B Hardware, Inc. v. Hargis Industries, Inc., B&B filed an opposition proceeding against Hargis, arguing the PTO should deny Hargis’ application for federal trademark registration because it would cause a likelihood of confusion with B&B’s prior trademark.
The parties litigated the issue to conclusion, and the TTAB agreed that Hargis’ mark would cause a likelihood of confusion. Hargis did not appeal.
The parties separately litigated in court the parallel issue of whether Hargis’ mark infringed B&B’s trademark rights. In that action, B&B argued that Hargis should be prevented from arguing that its mark did not cause a likelihood of confusion because it took that position in the TTAB proceeding and lost.
The court disagreed, and the jury found for Hargis — that Hargis’ use did not infringe B&B’s mark because it did not cause a likelihood of confusion.
B&B appealed, and the case worked its way up to the Supreme Court.
The Supreme Court reversed. It found the doctrine of “issue preclusion” should prevent a trademark owner from re-litigating an issue that was fully litigated before the TTAB. Because the standard for denying an application for registration and the standard for trademark infringement are basically the same — likelihood of confusion — the Supreme Court found that Hargis should not get a second chance to undo the TTAB’s finding when it could have appealed that decision and didn’t.
This ups the ante for trademark owners who go the distance in an opposition or cancellation proceeding before the TTAB. They should expect the TTAB’s findings to follow them into court in a subsequent trademark infringement lawsuit if the issues in both proceedings are substantially identical. If the loser in a TTAB proceeding wants to avoid the decision from haunting them later, they need to appeal it — or avoid an adverse decision altogether by not pursuing a questionable case with the TTAB from start to finish.
The case cite is B & B Hardware, Inc. v. Hargis Indus., Inc., 135 S. Ct. 1293, 191 L. Ed. 2d 222 (2015).