Today, the Supreme Court handed down its decision in B&B Hardware, Inc. v. Hargis Industries, Inc.. This decision has a real impact on companies that are applying for and challenging federal trademark registrations. While the full history and details of this case have been going on for almost two decades and, according to the Court, “could fill a long, unhappy book,” the important facts are fairly straight forward. In 1993 B&B registered its trademark “SEALTIGHT” for “threaded or unthreaded metal fasteners and other related hardwar[e]; namely, self-sealing nuts, bolts, screws, rivets and washers, all having a captive o-ring, for use in the aerospace industry.” In 1996, Hargis sought to register its trademark “SEALTITE” for “self-piercing and self-drilling metal screws for use in the manufacture of metal and post-frame buildings.” Eventually in 2002, The United States Patent and Trademark Office (“USPTO”) published Hargis’s mark for opposition and B&B filed an opposition which prompted a proceeding before the Trademark Trial and Appeal Board (“TTAB”). However, B&B had also filed a trademark infringement action in the circuit court.
This is where the issue before the Court comes in. B&B was arguing before both the circuit court and the TTAB that Hargis’s mark was so similar to its mark that it would create a likelihood of consumer confusion. Before the circuit court could rule on this matter, the TTAB agreed with B&B and ruled that the marks were so similar as to cause a likelihood of consumer confusion and refused to register Hargis’s mark. Hargis did not appeal the TTAB decision. B&B then argued in front of the circuit court that since the TTAB has already ruled on likelihood of confusion, that decision should apply to the circuit court and that Hargis should not be able to raise the defense that there is no likelihood of confusion. This is called claim preclusion, when once Court rules on an issue, other Courts are bound by that ruling. Today’s Supreme Court decision confirms that B&B is correct and that TTAB rulings would prevent those same issue from being argued in circuit court.
Hargis’s decision not to appeal the TTAB ruling, in effect, bound it to the ruling for any subsequent lawsuits. This is important. Proceedings before the USPTO can have a preclusionary effect. Hargis, by not appealing the TTAB decision, is now precluded from arguing one of its main defenses.
This ruling enforces that issues before the USPTO are serious matters that should not be taken lightly. If you have a trademark issue, contact the professionals at Smith & Associates for a free consultation.