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By Tamlin Bason
Nov. 25 — If a petitioner is able to demonstrate standing when it files a cancellation proceeding before the Trademark Trial and Appeal Board then that standing “necessarily establishes sufficient interest in an appeal or review of the TTAB's determination of that petition,” the U.S. District Court for the Eastern District of Virginia held Nov. 25.
The district court rejected the arguments offered by Amanda Blackhorse and other individuals who, after convincing the TTAB that the “Redskins” registrations were disparaging, claimed that they could not be parties in interest in the subsequent appeal of that decision. Blackhorse sought dismissal of Pro-Football Inc.'s complaint on the grounds that there is no case or controversy between the parties, and on the grounds that she is not a “party in interest” under Section 21(b) of the Lanham Act, 15 U.S.C §1071(b).
Blackhorse and the other petitioners had to demonstrate that they had a real interest in the outcome of the TTAB proceeding, and that interest necessarily carries over to appellate review of that proceeding, the court said.
It then noted that Pro-Football was statutorily prohibited from joining the Director of the Patent and Trademark Office as an adversarial party, making the petitioners “the only proper adversarial party against whom Pro-Football can bring suit.” It thus denied the motion to dismiss.
On June 18, the TTAB ruled that the various trademark registrations owned by the Washington Redskins “must be cancelled because they were disparaging to Native Americans at the respective times they were registered, in violation of Section 2(a)” of the Lanham Act.
Following that ruling, the only question was whether Pro-Football would appeal to the U.S. Court of Appeals for the Federal Circuit under Section 21(a), or instead file a civil action in district court under Section 21(b).
The mystery was short-lived; an attorney for the team told Bloomberg BNA on June 19 that the dispute would go to the Eastern District of Virginia, and the complaint was filed Aug. 14. The complaint named Blackhorse and the four other Native Americans who filed the cancellation petition as defendants.
In a Sept. 22 motion to dismiss, Blackhorse argued that the named defendants were not the sort of “parties in interest” against whom a civil action could be instituted under the Lanham Act. That argument was based on the language of Section 21(b)(4), which in relevant part states:
Where there is an adverse party, such suit may be instituted against the party in interest as shown by the records of the United States Patent and Trademark Office at the time of the decision complained of, but any party in interest may become a party to the action.
The motion, filed by Jeffrey J. Lopez and Jesse A. Witten of Drinker Biddle & Reath LLP, Washington, said, “[A]lthough PFI seeks reversal of the TTAB’s ruling that its trademarks are unregistrable, it cannot maintain an action under 15 U.S.C. §1071(b)(4) against the Blackhorse Defendants who have no actual or alleged economic or legal interest in the trademarks.”
Blackhorse also argued that there was no Article III case or controversy on account of the fact that she and the other defendants had no personal stake in the case.
Blackhorse's Article III argument relied heavily on the Federal Circuit's recent determination that the statutory option to appeal a loss in a patent reexamination decision does not give a consumer advocacy group standing to make that appeal (Consumer Watchdog v. Wis. Alumni Research Found., 753 F.3d 1258, 111 U.S.P.Q.2d 1241 (Fed. Cir. 2014)).
“Watchdogis distinguishable from the instant case because Defendants in this action allege, and the court found, that each Defendant has a ‘personal stake in the outcome' of the proceeding,” Judge Gerald Bruce Lee said.
When they filed the cancellation petition in 2006 the petitioners had to satisfy the threshold standing requirement by showing that they “have been, are, and/or will be damaged by said registrations.” The defendants continue to have an interest in the case since “a reversal of the decision and dismissal of Defendants' petition will cause them injury,” the court said, rejecting the Article III argument.
“Relying heavily on inapplicable precedent, Defendants contend that they are not parties in interest in this suit,” the court said.
The first “inapplicable” case that Blackhorse relied on was 3V, Inc. v. CIBA Specialty Chemicals Corporation, 587 F. Supp. 2d 641 (D. Del. 2008), where a district court dismissed an action what was filed under 35 U.S.C. §146. At stake was a priority determination by the Board of Patent Appeals and Interferences. The party that sought review, however, had disclaimed its interest in the invention following the board's ruling, leading the district court to conclude that it was not a “party of interest” under 15 U.S.C. §146.
The court here cited two reasons why that case was not persuasive.
“First, 3V, is a patent proceeding and therefore has no bearing on the trademark proceeding before this Court.”
Second, the court noted that the relevant party disclaimed its interest in the patent in 3V, whereas here Blackhorse has not withdrawn her petition for cancellation.
Although a trademark case, Hans C. Bick, Inc. v. Watson, 253 F.2d 344, 116 U.S.P.Q. 134 (D.C. Cir. 1958), proved no more helpful to Blackhorse's cause than 3V. In what should have been an inter partes dispute where three companies sought cancellation of Bick's registration, the court declined to dismiss the commissioner of patents in favor of those parties on the grounds that the companies were not “parties of interest” under Section 146.
It is because the case interpreted Section 146 of the Patent Act—since the relevant Lanham Act provisions had not yet been enacted—that it was irrelevant here, the court said.
The relevant Lanham Act provision is found in Section 21(b)(2), which states that the PTO “shall not be made a party to an inter partes proceeding under this subsection.” Thus, a party that proceeds to the district court under Section 21(b) can only litigate against the adverse party from the TTAB's proceeding. The court, recognizing this, said that a ruling in Blackhorse's favor would result in “four improper implications.”
First, granting Defendant's motion would deprive Pro-Football of the opportunity to review the TTAB's decision, therefore, evading review by an Article III court. Second, granting Defendant's motion would be contrary to the statutory scheme provided by 15 U.S.C. §1071 which gives either party in a cancellation proceeding the opportunity to review a decision before a United States District Court. Third, a grant of Defendant's motion would mean that the Director is the only proper party for any judicial review of a cancellation proceeding contrary to the explicit terms in the statute. Finally, granting Defendant's Motion to Dismiss will improperly make the cancellation proceeding before the TTAB a final decision.
Pro-Football was represented by Craig Crandall Reilly, Alexandria, Va.
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