Monday, July 06, 2015

Precedential No. 17: TTAB Refuses to Vacate HOUNDSTOOTH MAFIA Decision

An augmented Board panel denied the opposers' request to reopen, vacate, and dismiss without prejudice the TTAB's 2013 precedential decision [TTABlogged here] which dismissed an opposition to registration of the mark HOUNDSTOOTH MAFIA, in the design form shown below, for "shirts, hats." Opposers claimed Section 2(d) likelihood of confusion and Section 2(a) disparagement and false association, based on alleged trademark rights arising out of the University's and Coach Bear Bryant's use of a houndstooth pattern in conjunction with athletic services. A subsequent civil action for review of the Board's decision resulted in settlement and entry of a consent judgment, which in part ordered that the Board's decision be vacated.  The Board of Trustees of The University of Alabama and Paul W. Bryant, Jr. v. William Pitts, Jr. and Christopher Blackburn, 115 USPQ2d 1099 (TTAB 2015) [precedential].

The Board indicated that an augmented panel of five Administrative Trademark Judges, including the Chief Judge and the Deputy Chief Judge, was employed because of the importance of the issue and the frequency with which such requests for vacatur are made.

The civil action under Section 21(b)(1) for review of the TTAB's decision was filed in the U.S. District Court for the Northern District of Alabama. In settling the case, the parties submitted to the court a Final Consent Judgment, which would result in assignment to the University of applicants' rights in the HOUNDSTOTH MAFIA mark, including the opposed application. The consent judgment recited certain agreed-upon facts that "might be understood to stand in contradiction to those found by the Board" - for example, that the houndstooth pattern enjoys "widespread association with the University." The parties agreed that the Board's Order should be vacated.

The district court issued the Final Consent Judgment in May 2014, ordering that the Board's decision be vacated and that the "Register of Trademarks" allow the opposed application to proceed to registration. Opposers then filed with the Board their "Request to Reopen, Vacate and Dismiss Without Prejudice." Although applicants did not file an opposition to the motion, the Board chose to consider the motion on the merits in view of the "policies and public interest implicated by a request to vacate a precedential opinion based on a settlement."

When a dispute involving registrability becomes moot after a Board decision, due to settlement during an appeal, the appellate court will typically dismiss the appeal as moot and remand the case to the Board to allow the parties to move for vacatur of the Board's decision. In U.S. Bancorp, the Supreme Court, interpreting 28 U.S.C. Section 2106, held that "mootness by reason of settlement does not justify vacatur of a judgment under review," absent "exceptional circumstances." However, because the TTAB is not an Article III appellate court, U.S. Bancorp does not apply to a Board decision. Furthermore, opposers did not invoke FRCP 60(b) in seeking relief from the Board's judgment. The Board therefore undertook the initial task of determining the authority under which Opposers' request fell.

Section 21(b)(1) of the Lanham Act empowers a district court to adjudge that applicant's entitlement to a registration, whether a registration should be canceled, or such other matters as the issues may require. That section also provides that a district court "shall authorize the Director to take any necessary action, upon compliance with the requirements of law." [Emphasis supplied by the Board].

The Final Consent Judgment, however, does not reference any record evidence and "does not appear to involve adjudication," and "does none of these things a court is empowered to judge or directed to inform the Director of, following adjudication." It does not order that applicants are entitled to a registration and does not order cancellation of any registration. The Board saw no other "issues" as to which the court determined any facts, and it concluded that vacatur of the precedential Board opinion is not a "necessary action" under Section 21(b))1).

The court's directive that the PTO allow the application to proceed to registration did not require that the Board's decision be vacated and the opposition dismissed: it was not a "necessary action," because the assignment of the application was sufficient to allow the application to proceed to registration on behalf of the University. The Board's decision, which dismissed the opposition, did not stand  in the way of registration.

Concluding that 28 U.S.C. Section 2106 was not implicated, noting that Rule 60(b) was not invoked, and ruling that Section 21(b)(1) did not require vacatur, the Board then considered the matter in view of its "general equitable authority," under which it undertakes to balance the equities.

The Board saw no exceptional circumstances or any public interest that would require vacatur. The district court did not determine that the Board decision was wrong in any way. The Final Consent Judgment stated that the Board's order was erroneous in unspecified "material respects." In short, the Board concluded that the consent judgment did not represent an adjudication of any of the facts or issues before the court.

The Board's decision was deemed precedential in order to provide guidance to trademark practitioners on the issues decided. The consent judgment did not point to any error in the Board's decision, and nothing suggested the existence of any public interest that would be advanced by vacatur and that would outweigh the the Board's determination that the decision had precedential value.

And so the Board denied the motion.

Read comments and post your comment here

TTABlog comment: Had the opposers invoked FRCP Rule 60, the result would likely have been the same. Under that Rule, the sixth ground for relief, "any other reason that justifies relief," was pertinent here. Surely the Board would have ruled that relief was not justified.

Text Copyright John L. Welch 2015.


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