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Issue Preclusion Applies to Standing: TTAB
Practical Law Legal Update w-003-4902 (Approx. 3 pages)
Issue Preclusion Applies to Standing: TTAB
by Practical Law Intellectual Property & Technology
| Published on 16 Sep 2016 • USA (National/Federal) |
In NH Beach Pizza LLC v. Cristy's Pizza Inc., the Trademark Trial and Appeal Board (TTAB) ruled that issue preclusion applies to the issue of standing.
On August 29, 2016, in NH Beach Pizza LLC v. Cristy's Pizza Inc., the Trademark Trial and Appeal Board (TTAB) ruled that issue preclusion applies to the issue of standing ( (T.T.A.B. Aug. 29, 2016)).
NH Beach Pizza LLC filed a petition with the TTAB to cancel Cristy's Pizza Inc.'s BEACH PIZZA trademark in 2014. The TTAB dismissed the petition in 2015 for lack of standing, finding that NH Beach failed to establish:
- A real interest in the mark.
- A reasonable belief in damages.
NH Beach later filed a second petition for cancellation on the same grounds. Cristy's moved for summary judgment on the ground that the TTAB was barred from instituting the second proceeding by collateral estoppel based on issue preclusion. In opposing the motion, NH Beach argued, among other things:
- The Federal Circuit has found that dismissals for lack of standing should be without prejudice.
- The TTAB's dismissal of the first petition was without prejudice, and a collateral estoppel finding would wrongly transform the dismissal into a dismissal with prejudice.
- The standing issue was not argued by the parties, and the claims were not decided by the TTAB.
The TTAB held that issue preclusion applies to determinations of standing in TTAB proceedings. The TTAB noted that several circuit courts, including the US Courts of Appeals for the Federal Circuit and the First Circuit, have applied issue preclusion to bar re-litigation of standing in federal court actions.
The TTAB then ruled that the four elements of issue preclusion were satisfied and NH Beach's second petition was barred. Specifically, the TTAB found:
- NH Beach pleaded the same basis for standing as it did in the first action.
- Standing was actually litigated in the first action because the TTAB decided the issue after a full trial. Although NH Beach argued the first action was dismissed without prejudice, the TTAB held that:
- NH Beach was incorrect, as the first action was simply dismissed; and
- a case dismissed without prejudice still precludes the issues actually litigated in the case.
- The determination that NH Beach did not have standing was necessary to the TTAB's decision in the first action.
- NH Beach was fully represented in the first action, and had a full and fair opportunity to introduce evidence on the standing issue.
The TTAB further noted that NH Beach could have remedied its failure to prove standing by appealing under Section 21(b) of the Lanham Act (15 U.S.C. § 1071(b)), which would have allowed it to submit new evidence.