SCOTUS Says TTAB Rulings Can Preclude Courts

Today, the Supreme Court, in B&B Hardware v. Hargis Industries, held that if the likelihood of confusion issues decided by the Trademark Trial and Appeal Board in a registrability proceeding are materially the same as those decided in a subsequent infringement action in federal district court, the rules of collateral estoppel will preclude re-litigation of those issues in the district court infringement action. Preclusion may apply, said the Court, even though the Board’s and a court’s procedures for reviewing the evidence are not the same. For instance, court trials involve live witness testimony before the fact finder, whereas Board proceedings are decided on a written record.

Not every Board decision on likelihood of confusion will necessarily result in issue preclusion in a subsequent infringement action, however. Justice Alito, writing for the Court majority, stated that “if the TTAB does not consider the marketplace usage of the parties’ marks, the TTAB’s decision should have no later preclusive effect in a suit where actual usage in the marketplace is the paramount issue.”

The consequence of the Court’s decision is that parties before the Board may now treat a trademark opposition or cancellation proceeding with greater seriousness. Concerned about the possible preclusive effect of the Board’s decision in a later court action, the parties before the Board in the future may choose to submit greater volumes of documentary and testimonial evidence. This would be particularly so if one or both parties’ marks are in use in the marketplace at the time the TTAB proceeding is litigated.