Supreme Court Rules That Certain TTAB Rulings Have Preclusive Effect In Later Litigation
In B&B Hardware, Inc. v. Hargis Indus. et al., Case No. 13-352 (March 24, 2015), the Supreme Court held that courts should give rulings by the Trademark Trial and Appeal Board (“TTAB”) preclusive effect “if the ordinary elements of issue preclusion are met.” The case arose from a dispute between the parties regarding B&B’s “SEALTIGHT” mark and Hargis’s “SEALTITE” mark. The parties have engaged in “labyrinthine” litigation regarding the use of the SEALTIGHT and SEALTITE marks through “a feud of two decades” that has involved three Eighth Circuit appeals and two jury verdicts.
The Supreme Court’s decision arose from one of the more recent disputes between the parties. When Hargis attempted to register the SEALTITE mark, B&B opposed the registration. The TTAB agreed with B&B, and held that SEALTITE is confusingly similar to SEALTIGHT, and should not be registered. Hargis did not appeal the TTAB’s ruling to a district court or the Federal Circuit. At the same time, B&B sued Hargis for infringement, but the district court rejected B&B’s argument that the TTAB’s decision established likelihood of confusion under the doctrine of issue preclusion. The issue was presented to a jury, which found no likelihood of confusion. The Eight Circuit affirmed. The Supreme Court reversed, ruling that the as long as the typical elements of issue preclusion are met, the TTAB’s ruling on likelihood of confusion should not be disturbed by the district court.
The B&B Hardware decision enhances the importance of TTAB proceedings. Notably, however, the Supreme Court limited the effect of its decision, noting that “for a great many registration decisions [by the TTAB] issue preclusion will not apply because the ordinary elements will not be met.” Because of the possibility that TTAB decisions will be given preclusive effect, adversaries will devote more resources to TTAB proceedings, and will be more likely to seek judicial review of adverse rulings by the TTAB.