TTAB Applies Issue Preclusion, Grants Summary Judgment That "COCOA BUTTER FORMULA" Lacks Acquired Distinctiveness

E.T. Browne's application to register COCOA BUTTER FORMULA for personal care products was barred by the doctrine of issue preclusion in view of a ruling by the U.S. Court of Appeals for the Third Circuit that the phrase is merely descriptive and lacks acquired distinctiveness. Browne unsuccessfully argued that the opposition should be dismissed without prejudice because the appellate court's decision did not say that the phrase could never acquire distinctiveness. Cococare Products, Inc. v. E.T. Browne Drug Co., Inc., Opposition Nos. 91169074, 91162692, 91165288, and 91167122 (January 5, 2011) [not precedential].


In civil proceedings between the parties the Third Circuit reversed the District Court’s holding that COCOA BUTTER FORMULA is generic, but the appellate court also ruled that the phrase "cocoa butter formula" had not acquired distinctiveness. In the opposition, Opposer Cococare moved for summary judgment on the ground of res judicata.

The Board first ruled that claim preclusion did not apply because the claims are "manifestly different:" in the civil action, Cococare's counterclaim to cancel Browne's Supplemental Registration for COCOA BUTTER FORMULA and to amend Browne's Principal Registration for PALMER’S COCOA BUTTER FORMULA to disclaim COCOA BUTTER FORMULA, was based on genericness, whereas here its opposition is based on mere descriptiveness and lack of acquired distinctiveness vis-a-vis an application for
registration.

The Board then turned to the issue of issue preclusion, first noting that the parties here are identical to those in the civil action and that a final judgment on the merits was issue in the prior civil proceeding. The main question here was whether the claim in this opposition "is based on the same set of transactional facts as the claim in the civil action."

In the civil action, the Third Circuit had to decide the issue of whether COCOA BUTTER FORMULA had acquired distinctiveness for personal care products. Here, as in the civil litigation, "the claim of acquired distinctiveness of COCOA BUTTER FORMULA in the mark was based on a statement of substantially exclusive and continuous use in commerce for at least the five years immediately before the date of the statement."

The Board discerned "no material distinction" between the issue litigated in the civil action and the issue raised here, and so it found that "there is an identity of issue and that application of issue preclusion is appropriate." It therefore sustained the opposition.

However, the Board further noted (footnote 6) that "the issue of whether a particular designation has acquired secondary meaning is determined on the basis of facts existing as of the time registrability is being considered up to the close of testimony in an opposition proceeding, see General Foods Corp. v. MGD Partners, 224 USPQ 479, 486 (TTAB 1984), applicant has failed to submit any evidence or otherwise argue that COCOA BUTTER FORMULA has acquired distinctiveness since the time the issue was considered in the civil proceeding, so as to distinguish the issues in the two proceedings."

In other words, Browne is not precluded from seeking registration in the future should it provide new and additional evidence of acquired distinctiveness.

Indeed, the Board has previously observed that "when the circumstances upon which a prior holding was based may no longer prevail or where significant intervening events may have occurred, the operation of the doctrine of collateral estoppel may be put aside in a subsequent proceeding between the same parties." Haymaker Sports, Inc. v. Turian, 197 USPQ 32, 39 (TTAB 1977), aff’d on point, rev’d on other grounds, 581 F.2d 257, 198 USPQ 610 (CCPA 1978). [footnote 6]

Text Copyright John L. Welch 2011.