SCOTUS Trademark Decision: TTAB Rulings Can Preclude Courts

Posted by on Mar 30, 2015 in The Womp Womp Word | 0 comments

SCOTUS Trademark Decision:  TTAB Rulings Can Preclude Courts

On Tuesday, March 24, 2015, the Supreme Court issued an opinion in B&B Hardware Inc. v. Hargis Industries Inc., which held “a court should give preclusive effect to TTAB decisions if the ordinary elements of issue preclusion are met.” Specifically, this ruling held that federal court decisions on likelihood of confusion issues can be precluded by earlier findings from the Trademark Trial and Appeal Board (TTAB) if the issues are the same.

The parties in the present case both manufacture metal fasteners—B &B manufactures fasteners for the aerospace industry, while Hargis manufactures fasteners for construction. In 1993, B&B registered SEALTIGHT for “threaded or unthreaded metal fasteners and other related hardware; namely, self-sealing nuts, bolts, screws, rivets and washers, all having a captive o-ring, for use in the aerospace industry.” App. 223a.  In 1996, Hargis attempted to register SEALTITE for “self-piercing and self-drilling metal screws for use in the manufacture of metal and post-frame buildings.” App. 70a. Although the fasteners were for different industries, B&B opposed Hargis’ registration because of the similarities between SEALTITE and SEALTIGHT.

During the TTAB proceedings, the Board concluded that the SEALTITE mark should not be registered because of the likelihood of confusion with the SEALTIGHT mark. However, in a later infringement suit before the District Court, B&B argued that Hargis was precluded from contesting the likelihood of confusion because of the TTAB’s decision. The District Court disagreed, and the Eighth Circuit affirmed, holding that “preclusion was unwarranted because the TTAB and the court used different factors to evaluate likelihood of confusion, the TTAB placed too much emphasis on the appearance and sound of the two marks, and Hargis bore the burden of persuasion before the TTAB while B&B bore it before the District Court.” The issue before the Supreme Court was whether “the District Court should have applied issue preclusion to the TTAB’s decision that SEALTITE is confusingly similar to SEALTIGHT.”

The Supreme Court reversed the judgment of the Eighth Circuit and held that  “the decision of the first tribunal usually must be followed by the second at least if the issue is really the same.” Although the TTAB and federal courts focus on different issues, registration and infringement respectively, the standards they use are “not fundamentally different, and, more important, the operative language of each statute is essentially the same.” Justice Alito further stated that the court should apply the following rule: “So long as the other ordinary elements of issue preclusion are met, when the usage adjudicated by the TTAB are materially the same as those before the district court, issue preclusion should apply.”