United States: First District Court To Accord TTAB Determination Of Priority Preclusive Effect After B&B Hardware

Earlier this year, the Supreme Court announced in B&B Hardware, Inc. v. Hargis Industries that Trademark Trial and Appeal Board decisions are entitled to preclusive effect in later district court litigation, so long as the ordinary elements of issue preclusion are met.  The specific question in B&B Hardware—whether the TTAB's determination on the issue of likelihood of confusion should be accorded preclusive effect—led the Supreme Court to acknowledge that in many cases issue preclusion may not apply because the TTAB typically does not consider the full marketplace usage of the parties' marks.  The Supreme Court, however, provided no guidance regarding the preclusive effect of TTAB decisions on issues other than likelihood of confusion, such as priority, distinctiveness, or abandonment.

The U.S. District Court for the District of Maryland recently became the first court to apply B&B Hardware to an issue other than likelihood of confusion.  In Ashe v. PNC Financial Services Group, Inc., Case No. PWG-15-144 (D. Md. Nov. 17, 2015), the court considered whether the determination of priority in an earlier Board proceeding between the same parties involving the same mark should be accorded preclusive effect.

In the prior TTAB proceeding, the Board found no genuine issues of material fact that PNC had priority and granted summary judgment in PNC's favor.  The Board also rejected Ashe's arguments that he had prior rights based on analogous trademark use.  In an attempt to persuade the court that the priority determination made by the Board should not be accorded preclusive effect, Ashe invoked the Supreme Court's decision in B&B Hardware and argued that the priority issues before the two tribunals were distinct because the Board had not considered the marketplace usage of his mark.  The court dismissed that argument, noting that consideration of marketplace usage is relevant to the determination of likelihood of confusion, but not to the determination of priority.  Citing other precedents, the court held that the issue of priority of use in a TTAB proceeding and in district court infringement litigation is the same.

The court easily found that the other elements of issue preclusion were satisfied, and granted PNC's motion to dismiss.

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