B&B Hardware, Inc. v. Hargis Industries, Inc.
Respondent Hargis Industries, Inc. (Hargis), tried to register its trademark for SEALTITE with the United States Patent and Trademark Office pursuant to the Lanham Act. Petitioner, B&B Hardware, Inc. (B&B), however, opposed registration, claiming that SEALTITE is too similar to B&B's own SEALTIGHT trademark. The Trademark Trial and Appeal Board (TTAB) concluded that SEALTITE should not be registered because of the likelihood of confusion. Hargis did not seek judicial review of that decision.
Later, in an 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. 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.
Held: So long as the other ordinary elements of issue preclusion are met, when the usages adjudicated by the TTAB are materially the same as those before a district court, issue preclusion should apply. Pp. 147–160.
(a) An agency decision can ground issue preclusion. The Court's cases establish that when Congress authorizes agencies to resolve disputes, “courts may take it as given that Congress has legislated with the expectation that [issue preclusion] will apply except when a statutory purpose to the contrary is evident.” Astoria Fed. Sav. & Loan Assn. v. Solimino, 501 U.S. 104, 108. Constitutional avoidance does not compel a different conclusion. Pp. 147–151.
(b) Neither the Lanham Act's text nor its structure rebuts the “presumption” in favor of giving preclusive effect to TTAB decisions where the ordinary elements of issue preclusion are met. Astoria, 501 U.S., at 108. This case is unlike Astoria. There, where exhausting the administrative process was a prerequisite to suit in court, giving preclusive effect to the agency's determination in that very administrative process could have rendered the judicial suit “strictly pro forma.” [p139] Id., at 111. By contrast, registration involves a separate proceeding to decide separate rights. Pp. 151–153.
(c) There is no categorical reason why registration decisions can never meet the ordinary elements of issue preclusion. That many registrations will not satisfy those ordinary elements does not mean that none will. Pp. 153–160.
(1) Contrary to the Eighth Circuit's conclusion, the same likelihood-of-confusion standard applies to both registration and infringement. The factors that the TTAB and the Eighth Circuit use to assess likelihood of confusion are not fundamentally different, and, more important, the operative language of each statute is essentially the same.
Hargis claims that the standards are different, noting that the registration provision asks whether the marks “resemble” each other, 15 U.S.C. § 1052(d), while the infringement provision is directed towards the “use in commerce” of the marks, § 1114(1). That the TTAB and a district court do not always consider the same usages, however, does not mean that the TTAB applies a different standard to the usages it does consider. If a mark owner uses its mark in materially the same ways as the usages included in its registration application, then the TTAB is deciding the same likelihood-of-confusion issue as a district court in infringement litigation. For a similar reason, the Eighth Circuit erred in holding that issue preclusion could not apply because the TTAB relied too heavily on “appearance and sound.” Pp. 154–158.
(2) The fact that the TTAB and district courts use different procedures suggests only that sometimes issue preclusion might be inappropriate, not that it always is. Here, there is no categorical “reason to doubt the quality, extensiveness, or fairness,” Montana v. United States, 440 U.S. 147, 164, n.11, of the agency's procedures. In large part they are exactly the same as in federal court. Also contrary to the Eighth Circuit's conclusion, B&B, the party opposing registration, not Hargis, bore the burden of persuasion before the TTAB, just as it did in the infringement suit. Pp. 158–159.
(3) Hargis is also wrong that the stakes for registration are always too low for issue preclusion in later infringement litigation. When registration is opposed, there is good reason to think that both sides will take the matter seriously. Congress' creation of an elaborate registration scheme, with many important rights attached and backed up by plenary review, confirms that registration decisions can be weighty enough to ground issue preclusion. Pp. 159–160.
716 F.3d 1020, reversed and remanded.
ALITO, J., delivered the opinion of the Court, in which ROBERTS, C.J., and KENNEDY, GINSBURG, BREYER, SOTOMAYOR, and KAGAN, JJ., joined. [p140] GINSBURG, J., filed a concurring opinion, post, p. 160. THOMAS, J., filed a dissenting opinion, in which SCALIA, J., joined, post, p. 161.
William M. Jay argued the cause for petitioner. With him on the briefs were Jacob R. Osborn, Robert D. Carroll, Ira J. Levy, and Tim Cullen.
John F. Bash argued the cause for the United States as amicus curiae urging reversal. With him on the brief were Solicitor General Verrilli, Assistant Attorney General Delery, Deputy Solicitor General Stewart, Mark K. Freeman, Sydney Foster, and Scott C. Weidenfeller.
Neal Kumar Katyal argued the cause for respondent Hargis Industries, Inc. With him on the brief were Catherine E. Stetson, Mary Helen Wimberly, James C. Martin, and Colin E. Wrabley.*
Notes edit
* ↑ Briefs of amici curiae urging affrmance were fled for the Intellectual Property Law Section of the State Bar of Texas by Richard L. Stanley and Jack C. Goldstein; and for the New York Intellectual Property Law Association by Dyan Finguerra-DuCharme, Anthony F. Lo Cicero, and Charles R. Macedo.
Briefs of amici curiae were fled for the American Intellectual Property Law Association by Nancy J. Merztel; for the Intellectual Property Law Association of Chicago by Charles W. Shifey and Donald W. Rupert; and for the International Trademark Association by David H. Bernstein and Michael Potenza.
This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).
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