CAFC Affirms TTAB in TAI CHI Cancellation, Giving Deference to TBMP on Evidentiary Issues

The U.S. Court of Appeals for the Federal Circuit affirmed the Board’s decision [here] ordering cancellation of a registration for the mark WU DANG TAI CHI GREEN TEA & Design (shown below left) for “green tea; tea; tea bags,” in view of the registered mark TAI CHI (shown below right) for, inter alia, tea. The court ruled that the Board had properly refused to consider evidence contained in Respondent’s main brief and also properly rejected Respondent’s reply brief. The court then found that substantial evidence supported the Board’s finding of likelihood of confusion. Zheng Cai, d/b/a Tai Chi Green Tea, Inc. v. Diamond Hong, Inc., 127 USPQ2d 1797 (Fed. Cir. 2018) [precedential].

Evidentiary Rulings: The CAFC reviews evidentiary rulings for abuse of discretion. Coach Servs., Inc. v. Triumph Learning LLC, 668 F.3d 1356, 1363 (Fed. Cir. 2012).

The TTAB considered the arguments presented in Mr. Cai’s Main Brief but did not “consider[] the factual assertions and ‘figures’ displayed and discussed in [Mr. Cai’s] brief, which are not evidence introduced into the trial record.” The Board also refused to consider Mr. Cai’s reply brief because the TBMP does not provide for such filings and gives the TTAB broad discretion in considering them.

Although the procedural guidelines in the TBMP do not have the force of law, see TBMP Introduction (explaining that “[t]he manual does not modify, amend, or serve as a substitute for any existing statutes, rules, or decisional law and is not binding upon the [TTAB or] its reviewing tribunals”), the TBMP is accorded a degree of deference to the extent that it has the “power to persuade,” Christensen v. Harris Cty., 529 U.S. 576, 587 (2000). 

The CAFC has previously affirmed TTAB determinations with regard to evidence admission, where they are clearly in line with the language of the TBMP. Mr. Cai's main brief contained numerous assertions of fact; such assertions “are not evidence under any of the relevant Rules.” And so the court concluded that the TTAB did not abuse its discretion in ruling that Mr. Cai submitted no evidence.

As to his reply brief, the TBMP plainly states that the TTAB is not required to permit “a party in the position of defendant” to file a reply brief. Mr. Cai was the defendant in the cancellation proceeding. Therefore, the Board did not abuse its discretion in refusing to consider the reply brief.

Likelihood of Confusion: The CAFC reviews the TTAB’s factual findings on each du Pont factor for substantial evidence, and its legal conclusion of likelihood of confusion de novo. Stone Lion Capital Partners, 746 F.3d at 1321 (citations omitted). The court concluded that the Board did not err.

The Board considered the first three du Pont factors, since the parties did not submit evidence on the other factors. Substantial evidence supported the Board’s findings. The goods are identical in part, and the Board correctly presumed that these identical goods move in the same trade channels and are available to the same classes of customers: general purchasers who purchase or consume tea. See In re Viterra Inc., 671 F.3d 1358, 1362 (Fed. Cir. 2012).

As to the marks, when the goods are identical, a lesser degree of similarity is necessary to support a conclusion of likely confusion. In re Viterra, 671 F.3d at 1363. When considered as a whole, the marks at issue are similar because both “invoke a large yin-yang symbol and prominently display the term TAI CHI.”

“The fact that color is not claimed as a feature of Diamond Hong’s mark . . . further highlights the likelihood of confusion because, as the TTAB correctly identified, Diamond Hong’s mark “could be presented in a green and- white color scheme like [Mr. Cai’s].”

Conclusion: “The TTAB’s findings as to the DuPont factors are supported by substantial evidence and the TTAB did not err in finding a likelihood of confusion." And so the CAFC affirmed.

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TTABlog comment: I guess the court's comments regarding the TBMP make this opinion precedential.

Text Copyright John L. Welch 2018.