Issue Preclusion by Trademark Appeal Decisions

04/23/2015 / Jim Quinn

The Patent and Trademark Office and its “judicial body,” the Trademark Trial and Appeal Board (“TTAB”), consider the registrability of a mark; and not infringement. Federal courts determine whether an infringement has occurred. In TTAB proceedings a “likelihood of confusing similarity” analysis is used to determine whether the mark in an application conflicts with another mark. In a trademark infringement lawsuit, federal courts also use a likelihood of confusing similarity test to decide whether one mark infringes another mark. However, the elements of confusing similarity used by the TTAB, and the ones used by the federal courts, are not always in precise alignment. As a result, the decisions of the TTAB have not been dispositive when the same marks are the subject of infringement litigation in federal court.
 
In a very recent decision, the Supreme Court made a fundamental change to this practice. In B & B Hardware v. Hargis, the Supreme Court decided that the TTAB’s use of the likelihood of confusion analysis to deny registration of the mark, Sealtite,” because of an already existing registration of “Sealtight” by another party, ‘precluded” a federal court from deciding the issue otherwise. The justices concluded that because both the TTAB and the federal courts use essentially the same standards in determining likelihood of confusing similarity, there was no reason why, under certain circumstances, a TTAB decision could not be dispositive in an infringement suit involving the same marks.
 
In defending and enforcing trademark rights, mark owners are often required to make strategic decisions about the most efficient, expeditious, and economical way to protect their rights. This will often result in a decision to initiate a proceeding before the TTAB. These actions are typically faster and less expensive than an infringement suit; and if the action is successful, it often causes the offending party to abandon its efforts to use the conflicting mark. And, historically, even if the TTAB action was unsuccessful, the party that started the action could still go to federal court with an infringement claim. However, trademark owners may now need to be much more vigilant and forceful in TTAB proceedings because the outcome could close the door with respect to actions in federal court. The “second bite” at the apple may now be gone.