We sounded the alarm exactly six months ago about a trademark case of great importance to brand owners: B&B Hardware v. Hargis Industries. Earlier this week, the U.S. Supreme Court heard oral argument in the case, and here is a link to the transcript (hat tip to Draeke).
As you will recall, our concern in sounding the alarm is that the Supreme Court might follow the advice of the Solicitor General (SG) who essentially equates the right to register with the right to use a trademark, seemingly suggesting the right to use is dependent on the right to register:
“The SG’s amicus brief, as well-written as it is, fails to appreciate the very limited scope of TTAB jurisdiction, the full extent of its unique practices and procedures in deciding likelihood of confusion for purposes of registration, and unfortunately the influential SG takes the following misguided position (without respecting the TTAB’s own view of its limited jurisdiction, much less appreciating the negative impact that the threat of preclusion will have by necessarily escalating the stakes, intensity and expense of administrative Board proceedings going forward):
“When the Board concludes in an opposition proceeding that a likelihood of confusion does or does not exist with respect to particular usages, that determination precludes relitigation of the likelihood of confusion question in a subsequent infringement action between the same parties for the same usages.”
We liked INTA’s amicus brief far better, calling for a black and white test against preclusion:
“INTA’s amicus brief is the only one to score an A. INTA’s amicus brief did a very impressive job of communicating the clear difference between how likelihood of confusion is addressed at the TTAB in determining the right to register, as compared to how likelihood of confusion is addressed in federal courts across the country — with brand owners having far more at stake in the latter, including injunctive relief, damages, and attorneys fees.”
We’ve also said before:
“Baby trademark lawyers have been taught for decades that the right to register a trademark is separate and distinct from the right to use a trademark. Every day we clear marks for brand owners understanding the critical difference between these important rights. It is not uncommon for a brand owner to be refused registration of a trademark based on another’s prior registration for a similar mark, but that doesn’t necessarily mean the brand owner’s use of the mark is infringing, or that it should be enjoined, or that monetary awards are appropriate for the continued use of the mark.”
So, imagine my pleasant surprise in reading the Supreme Court transcript (because I couldn’t just walk down the street to hear the live oral argument like Erik Pelton) that Justice Ginsburg appeared receptive to our channeling — coming out of the gates hard against preclusion, within the first 75 words uttered by counsel for Petitioner B&B Hardware:
Mr. William Jay: “The Lanham Act contains only one concept of likelihood of confusion. That is why the two tribunals in this case decided the same issue, and that is why the issue of preclusion is appropriate. Whether a court is considering registration or infringement or both at the same time, the statutory test is the same, whether the resemblance of the marks as used on particular goods would give rise to a likelihood of confusion or mistake or deceit.”
Justice Ginsburg: “Mr. Jay, there are exceptions to preclusion even though you would see the identical issue, and one of them is when the stakes are higher in the second proceeding than in the first and . . . . it seems to me this is such a case, because it’s one thing to say that we won’t register your mark and another to say you can’t use the mark. . . . And one way of assuring expeditiousness is to confine the stakes to the matter immediately in controversy. . . . The matter of controversy is registration, and in the second proceeding, it’s infringement. . . . [Y]ou don’t want to make that [expeditious first] proceeding pull out all the stops because it’s going to be determinative of the infringement suit. . . . [I]f one aspect of the first proceeding is to assure expeditiousness, then confining the stakes to that issue of registration makes sense so that the parties will not be induced to dispute the administrative proceeding in anticipation of its effect on another proceeding.”
Bingo! And, here’s to hoping that Justice Ginsburg ends up writing the Court’s majority opinion.