Thursday, May 13, 2010

CAFC Reverses TTAB's "FRED" Ruling: Fee Not Needed With Motion for Leave to Amend Cancellation Petition to Add Classes

The CAFC reversed the TTAB's ruling in Fred Beverages, Inc. v. Fred's Capital Management Company, Cancellation No. 92048454 (June 26, 2009) [not precedential]. The Board had denied Petitioner's motion to add four classes to its petition for cancellation because the motion "was not accompanied by any payment or authorization to charge respondent's [sic] deposit account for any of the additional classes sought to be cancelled." The CAFC reversed the Board's decision, holding that the denial of Petitioner's motion was arbitrary and capricious. Fred Beverages, Inc. v. Fred's Capital Management Company, 94 USPQ2d 1958 (Fed. Cir. 2010) [precedential]. [An mp3 of the oral argument may be found here]

The court observed that the Board did not cite any equitable reason to deny the motion, but relied solely on Petitioner's failure to file the fee associated with the proposed petition. It noted that it is "common judicial procedure" to require that some motions be accompanied by a fee, citing several examples, but such requirements "are set forth in the stated rules of practice pertaining to the tribunal." Here, "[t]here is no stated rule of the TTAB that a motion for leave to amend a petition for cancellation must be accompanied by the statutory fee corresponding to the classes for which cancellation is sought by amendment."

Even without a stated rule, the TTAB "might still justify requiring a cancellation fee to accompany a motion for leave if such requirement were consistent with established practice." But Petitioner provided prior Board rulings granting similar motions for leave to amend and allowing a certain time period for payment of the cancellation fee.

It therefore appears that the TTAB has no stated rule and no established practice of requiring that a supplemental cancellation fee be included with a motion for leave to amend a petition for cancellation. The lack of authority for the TTAB’s decision is further confirmed by the fact that the TTAB opinion cited no rule or precedent on point in support of its decision to deny the Motion for Leave in this case.

The CAFC therefore ruled that the denial was arbitrary and capricious, and it reversed the Board's decision and remanded the case to the TTAB for further proceedings.

TTABlog comment: My predictions regarding the outcome of this appeal proved to be correct. See postings here and here.

Hat tip to H. Jay Spiegel, counsel for Appellant and occasional TTABlog subject: see prior posts here and here.

Jay's main claim to fame may be his invention (patented) of the kicking tee used by the NFL for the past eleven seasons.

Actual GROUND ZERO® brand tee used by Adam Vinatieri in New England Patriots' Super Bowl XXXVI victory

Text Copyright John L. Welch 2010. First and third photographs Copyright H. Jay Spiegel, 2010, 2005, respectively.


At 6:44 AM, Anonymous Rob said...

The CAFC has reached the only possible result.

The Board cannot issue a nonprecential decision pretending that the prior case law on the issue in unambiguous. If the Board wishes to change trademark practice, it should issue a precedential decision which clearly acknowledges the novelty of its approach.

At 4:50 AM, Anonymous Rob said...

John: May I suggest a follow-up post by you on this topic. It has been 8 months since the CAFC remanded the case to the Board, and the Board has yet to say a word on the issue. Attorney for plaintiff has filed papers urging the Board to act on the remand.


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