Wednesday, December 16, 2015

Hell Freezes Over: TTAB Reverses NETCLOUD Decision on Reconsideration

A Board reversal on reconsideration is about as rare as a White Sox fan in Boston. But that's just what happened in the NETCLOUD opposition. In its original decision (here), the Board sustained a Section 2(d) opposition to registration of the mark NETCLOUD for various computer monitoring services, finding a likelihood of confusion with the (allegedly) previously used and identical mark for overlapping services. Applicant East Coast Network moved for reconsideration, contending that the Board had wrongly determined the priority issue because it relied on evidence that had been stricken, and because it permitted Opposer to rely on an issue that had not been pleaded. NetCloud, LLC v. East Coast Network Services, LLC, Opposition No. 91210559 (on reconsideration, December 10, 2015) [not precedential].

The Board had stricken certain exhibits because they were untimely submitted (i.e., with Opposer's reply brief rather than during its testimony period), and also because a party cannot rely on its own discovery responses. But the Board nonetheless considered the responses elsewhere in its decision. That was inappropriate and an error by the Board.

The Board had also allowed Opposer to establish priority by proving use of the subject mark by a predecessor-in-interest. Applicant maintained that this evidence was beyond the scope of the pleadings, which had not alleged use by a predecessor. Applicant had repeatedly objected to the admission of exhibits regarding this prior use, but the Board had basically ignored those objections.

On reconsideration, the Board ruled that the continuing objections to the exhibits at the testimony depositions was equivalent to a timely objection to the depositions in their entireties. The Board concluded that "Opposer's trial tactics contravene notice pleading requirements of the modern federal rules of appellate and civil procedure." The Board cited pertinent precedent:

Where testimony and exhibits relating to the adoption and use by opposer of trademarks are not the subject of any allegations in the pleadings, and applicant has objected at trial to the consideration of such matter on the ground of irrelevancy and renewed its objections in its brief, the evidence will not be considered by this Board in resolving the issues before it. Monorail Car Wash, Inc. v. McCoy, 178 USPQ 434, 435-36, fn.1 (TTAB 1973); P.A.B. Produits et Appareils de Beaute v. Satinine Societa in Nome Collettivo di S.A. e. M. Usellini, 196 USPQ 801, 804 (CCPA 1978).

With the above-discussed exhibits and depositions stricken from the record, the Board found that "in the absence of probative evidence of use of the NETCLOUD marks prior to Applicant's filing date, ... Opposer has failed to make out a prima facie case of priority."

The opposition was therefore dismissed.

Read comments and post your comment here.

TTABlog comment: This dark netcloud had a silver lining/

Text Copyright John L. Welch 2015.


At 11:54 AM, Anonymous Anonymous said...

John - I think the Board should make this ruling precedent. Thanks, Tona


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