Are Circuit Courts Of Appeals Split As To The Preclusive Impact Accorded To Prior Trademark Trial And Appeal Board Decisions?

Battles between brand owners are frequently fought in the United States in two forums: the Trademark Trial and Appeal Board and federal district court. While the TTAB is limited to determining a party's right to register its trademark, district courts may adjudicate rights to registration and use of a mark. When prosecuting or defending an inter partes challenge to registration before the TTAB, brand owners are wise to consider the possible preclusive impact of the TTAB's decision in a later-filed or concurrently pending district court action. In its recent petition for a writ of certiorari, B&B Hardware, Inc. argues that Circuit Courts of Appeals are incurably split as to whether district courts are collaterally estopped from relitigating issues decided by the TTAB. In its opposition, respondent Hargis Industries, Inc. argues that any alleged Circuit split is illusory. B&B's petition is still pending, and the Court recently invited the Solicitor General to file a brief expressing the view of the government.

The Underlying Actions

B&B and Hargis are both in the fastener business; the former's products are used predominantly in the aerospace industry and the latter's in the construction of metal buildings. In 1993, B&B registered its SEALTIGHT trademark for use on "threaded or unthreaded metal fasteners and other related hardware; namely, self-sealing nuts, bolts, screws, rivets and washers, all having a captive o-ring, for use in the aerospace industry." B&B filed an opposition to Hargis' 1996 application to register SEALTITE for use with "self-piercing and self-drilling metal screws for use in the manufacture of metal and post-frame buildings." After discovery and the taking of testimony, the TTAB ultimately sustained B&B's opposition on the grounds that Hargis' SEALTITE mark was likely to cause confusion with B&B's SEALTIGHT mark. In a concurrently pending district court case between the parties, the court rejected B&B's argument that the TTAB's decision was entitled to any preclusive effect or admissible into evidence on the grounds that the TTAB is not an Article III court. The jury found for Hargis on B&B's infringement claim and Hargis' counterclaims, and the court awarded Hargis its attorneys' fees under the Lanham Act's attorneys' fees provision.

B&B appealed the trial court's decision to the Eighth Circuit, who affirmed. It held that the likelihood of confusion tests applied by it and the TTAB include different factors, with only...