Allura Imports, Inc.v.Michelle L. Sanderson

Trademark Trial and Appeal Board

Jul 18, 2018

No. 91238924 (T.T.A.B. Jul. 18, 2018)

MW Mailed: July 18, 2018

Opposition No. 91238924
Allura Imports, Inc.

v.
Michelle L. Sanderson

Before Taylor, Mermelstein, and Heasley,
Administrative Trademark Judges.

By the Board:

On January 11, 2018, Allura Imports, Inc. (“Opposer”) filed a notice of opposition
to the registration of the standard-character mark AMERICAN HERO CLOTHING
for “hats; pants; short-sleeved or long-sleeved t-shirts; sweatshirts; tank tops” in
International Class 25.1 On the ESTTA2-generated cover sheet for the notice of
opposition, Opposer asserts the following grounds for opposition: (1) no use in
commerce prior to Applicant’s filing date; (2) failure to function as a trademark; and
(3) fraud on the USPTO. In addition, in the text of the complaint, Opposer claims that

1 Application Serial No. 86479873 was filed on December 13, 2014, based on use in commerce
under Trademark Act Section 1(a), 15 U.S.C. § 1051(a). Applicant claims December 1, 2011
as its date of first use anywhere and date of first use in commerce. The application includes
a disclaimer of the word “CLOTHING.”
2 ESTTA stands for the Electronic System for Trademark Trials and Appeals, the Board’s
online electronic filing system.
UNITED STATES PATENT AND TRADEMARK OFFICE
Trademark Trial and Appeal Board
P.O. Box 1451
Alexandria, VA 22313-1451
General Contact Number: 571-272-8500
THIS ORDER IS NOT A
PRECEDENT OF THE
TTAB
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the mark has been “abandoned after years of . . . non-use.”3 In lieu of an answer,
Applicant filed a motion for summary judgment based on res judicata (claim
preclusion) and collateral estoppel (issue preclusion). 4 TTABVUE. The motion for
summary judgment is fully briefed.
Applicant argues that the claims and issues asserted in the notice of opposition
were adjudicated in a prior cancellation proceeding between the parties and are based
on the same transactional facts that were the basis of the prior proceeding.4 Applicant
contends that the following assertions of transactional facts in the notice of opposition
are identical to Opposer’s arguments that the Board dismissed as unsupported in the
prior proceeding between the parties: (1) that Applicant did not make continuous use
of her marks; (2) that Applicant’s evidence was insufficient to show priority; (3) that
Applicant abandoned her marks; (4) that she has no trademark rights due to
insufficient trademark use; and (5) that her use of the AMERICAN HERO marks was
merely ornamental. Applicant further argues that Opposer’s allegations of
misrepresentation and fraud are based on allegations “that the Board rejected in the
Prior Action.” 4 TTABVUE 7.5
In the alternative, Applicant argues that issue preclusion applies in this case
because Opposer argued all of the issues in the prior proceeding, the issues were fully
litigated in Applicant’s favor, the issues were necessary to the judgment of the case,

3 Notice of Opp., at ¶ 12, 1 TTABVUE 6.
4 Applicant submitted a copy of the decision in Cancellation No. 92061702 with her brief. 4
TTABVUE 11-21.
5 Applicant also asserts that the claims of misrepresentation and fraud are “not pleaded in
any specific detail in the notice of opposition.” 4 TTABVUE 8.
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and Opposer had a full and fair opportunity to litigate the issues in the cancellation
proceeding. 4 TTABVUE 8-10.
In response to the motion, Opposer argues that there was no claim of
abandonment in the cancellation proceeding; thus, the Board did not rule on
abandonment. Opposer further argues that it should not be precluded from alleging
abandonment “because it relates to a continually passing and therefore subsequent
period of time.” 7 TTABVUE 4. Finally, Opposer argues that the issues alleged in the
notice of opposition “are all independent of the original Cancellation Proceeding and
the priority issue litigated therein and warrant a separate and fair adjudication
herein.” Id. at 3.
The Board presumes the parties’ familiarity with the pleadings, the history of the
proceedings, and the arguments and materials submitted in connection with the
subject motion. The Board has considered the arguments and evidence submitted in
connection with the motion, but does not repeat or discuss all of the arguments and
submissions, and does not address irrelevant arguments. Guess? IP Holder L.P. v.
Knowluxe LLC, 116 USPQ2d 2018, 2019 (TTAB 2015).
I. Summary Judgment
Summary judgment is an appropriate method of disposing of cases in which there
is no genuine dispute as to any material fact and the movant is entitled to judgment
as a matter of law. See Fed. R. Civ. P. 56(a). In reviewing a motion for summary
judgment, the evidentiary record and all justifiable inferences to be drawn from the
undisputed facts must be viewed in the light most favorable to the non-moving party.
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See Lloyd’s Food Prods. Inc. v. Eli’s Inc., 987 F.2d 766, 25 USPQ2d 2027, 2029-30
(Fed. Cir. 1993); Olde Tyme Foods Inc. v. Roundy’s Inc., 961 F.2d 200, 22 USPQ2d
1542, 1546 (Fed. Cir. 1992).
Applicant’s assertion that Opposer’s claims are precluded by the previous
proceeding is in the nature of an affirmative defense. Accordingly, Applicant, as the
party moving for summary judgment, bears the burden on summary judgment to
establish that there is no genuine dispute of material fact, and that she is entitled to
judgment as a matter of law. See generally Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986). Opposer, as the nonmoving party, may not rest on mere allegations, but must
designate specific portions of the record showing the existence of a genuine dispute of
material fact for trial. See Venture Out Props. LLC v. Wynn Resort Holdings LLC, 81
USPQ2d 1887, 1890 (TTAB 2007); see also Fed. R. Civ. P. 56(c)(1).
Applicant has satisfied her burden to demonstrate that there is no genuine dispute
of material fact with respect to preclusion by submitting the pleadings from the prior
proceeding, the relevant moving papers, and the Board’s order granting her motion
for summary judgment. Opposer does not dispute the veracity of these submissions.
We therefore proceed to consider whether Applicant is entitled to judgment as a
matter of law.
Under the doctrine of res judicata, or claim preclusion, the entry of judgment in a
prior proceeding operates to preclude relitigation of the same claim or defense in a
subsequent proceeding if: “(1) there is identity of parties (or their privies); (2) there
has been an earlier final judgment on the merits of a claim; and (3) the second claim
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is based on the same set of transactional facts as the first.” Jet Inc. v. Sewage Aeration
Sys., 223 F.3d 1360, 55 USPQ2d 1854, 1857 (Fed. Cir. 2000), reh’g and reh’g en banc
denied (September 28, 2000). The three-part test is typically applied against a
plaintiff who brings a second action related to an earlier action. A defendant in the
first action is precluded from bringing a claim or defense in a later proceeding against
the same party only if “(1) the claim or defense asserted in the second action was a
compulsory counterclaim that the defendant failed to assert in the first action, or (2)
the claim or defense represents what is essentially a collateral attack on the first
judgment.” Nasalok Coating Corp. v. Nylok Corp., 522 F.3d 1320, 86 USPQ2d 1369,
1372 (Fed. Cir. 2008).
In the event that claim preclusion does not apply, collateral estoppel or issue
preclusion may bar re-litigation of issues in a second action that were actually
litigated and necessary to the outcome of the first action. Collateral estoppel requires
(1) identity of an issue in a prior proceeding; (2) that the identical issue was actually
litigated; (3) that determination of the issue was necessary to the judgment in the
prior proceeding; and (4) that the party defending against preclusion had a full and
fair opportunity to litigate the issue in the prior proceeding. Mayer/Berkshire Corp.
v. Berkshire Fashions Inc. 424 F.3d 1229, 76 USPQ2d 1310, 1313 (Fed. Cir. 2005)
(citing Montana v. United States, 440 U.S. 147, 153-55 (1979)).
A. Prior Cancellation Proceeding
In the prior cancellation proceeding between the parties (No. 92061702),
Applicant, as Petitioner in the cancellation proceeding, sought to cancel Opposer’s
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registration for the standard character mark AMERICAN HERO for “men, women,
and children clothing, namely, shirts, pants, coats, dresses sweaters, skirts,” in
International Class 25,6 alleging a likelihood of confusion with Applicant’s previously-
used mark — the same mark as that now at issue in this opposition. On summary
judgment, the Board found that there was no genuine dispute of material fact that
there was a likelihood of confusion between Applicant’s pleaded mark and Opposer’s
registered mark. 4 TTABVUE 20. The Board further found, based on the evidence in
the summary judgment record, that Applicant had demonstrated use of her pleaded
marks, including AMERICAN HERO CLOTHING, in connection with various
articles of clothing prior to June 6, 2012, the constructive use date of Opposer’s
registration. Id. at 19. Opposer failed to offer any evidence in opposition to the motion
for summary judgment. Accordingly, the Board granted Applicant’s motion for
summary judgment on the likelihood of confusion claim and cancelled Opposer’s
registration.
B. Nonuse and Failure to Function
We first note that because Applicant did not plead ownership of a registration in
the earlier cancellation proceeding, none of the claims asserted by Opposer in this
proceeding could have been raised as counterclaims (compulsory or permissive) in the
first proceeding. See Trademark Rule 2.114(b)(3)(i), 37 C.F.R. § 2.114(b)(3)(i). Thus,
the first basis for applying claim preclusion against a defendant in the first action
under Nasalok does not apply to this case.

6 Registration No. 4288491 registered on February 12, 2013.
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Turning to the second basis for applying claim preclusion under Nasalok, namely,
whether the later action represents a collateral attack on the judgment in the earlier
proceeding, we note that the allegations in the notice of opposition are essentially
identical to Opposer’s arguments in its brief in response to the motion for summary
judgment in the cancellation proceeding.7 In particular, the allegations in paragraphs
3 and 4 of the notice of opposition are merely a reargument of Opposer’s attack on
Applicant’s evidence submitted in connection with her motion for summary judgment
in the cancellation proceeding.8 As noted above, upon summary judgment in the
cancellation proceeding, the Board found Applicant’s evidence sufficient to establish
the use of her mark in commerce prior to June 6, 2012, and specifically rejected
Opposer’s unsupported arguments. 4 TTABVUE 20-21. In view thereof, we find that
Opposer’s claims of nonuse and failure to function as a mark represent a collateral
attack on the Board’s determination in the earlier proceeding that Applicant
established priority based on use of her mark in commerce.9 Thus, Opposer is barred
from asserting the claims in this proceeding by the doctrine of claim preclusion.

7 See Opposer’s Summary Judgment Brief, 4 TTABVUE 46-49.
8 The allegations are identical in substance to the arguments in Opposer’s brief in opposition
to the summary judgment motion in the cancellation. See 4 TTABVUE 47-48.
9 In the absence of an earlier application or registration filing date, a plaintiff may establish
prior rights by showing prior trademark or service mark use or prior use analogous to
trademark or service mark use. Trademark Act Section 2(d), 15 U.S.C. 1052(d); see also
TBMP § 309.03(c)(2) (June 2017). Because the Board in the earlier proceeding found that
Applicant demonstrated priority based on evidence of prior trademark use, Opposer’s
allegations of insufficient trademark use, including ornamental use, constitute an attack on
the earlier decision.
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C. Fraud
With respect to the fraud claim, Opposer’s vague allegation of “fraud or
misrepresentation in the present Application as to use in commerce”10 is insufficient
to support a claim of fraud. Opposer has failed to allege any facts in the notice of
opposition to support the elements of a fraud claim, namely, that Applicant knowingly
made specific, false representations of material fact in connection with her
application with the intent of obtaining a registration to which she is not otherwise
entitled. See In re Bose Corp., 580 F.3d 1240, 91 USPQ2d 1938, 1942 (Fed. Cir. 2009);
see also Fed. R. Civ. P. 9(b) (elements of fraud must be pleaded with particularity).
To the extent that Opposer intends to assert a claim of fraud based on an allegation
that Applicant did not use the mark in commerce prior to the filing date of the
involved use-based application, we find that Opposer is precluded from asserting such
a claim because it is essentially a collateral attack on the Board’s earlier decision that
Applicant had used her marks prior to June 6, 2012.
D. Abandonment
Turning to Opposer’s claim that Applicant abandoned her mark,11 while Opposer
argued the issue of abandonment on summary judgment in the earlier proceeding,
the defense was not litigated and determined because Opposer failed to plead

10 Notice of Opposition, at introductory paragraph, 1 TTABVUE 3.
11 Opposer frames the issue as whether “Applicant has . . . been continuously using its mark.”
Notice of Opp., 1 TTABVUE 5, ¶ 8. Nonetheless, there is no requirement that a trademark
be continuously used. The relevant question is whether the mark has been abandoned,
defined by statute as nonuse “with intent not to resume such use.” W. Fla. Seafood Inc. v. Jet
Rests. Inc., 31 F.3d 1122, 31 USPQ2d 1660, 1665 (Fed. Cir. 1994) (quoting Trademark Act
§ 45, 15 U.S.C. § 1127).
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abandonment as a defense. 4 TTABVUE 20-21. However, in addition to precluding
relitigation of matters that have been litigated, claim preclusion forecloses “any
litigation of matters that never have been litigated because of a determination that
they should have been advanced in an earlier suit.” 18 Charles A. Wright, et. al.,
FEDERAL PRACTICE and PROCEDURE § 4402 (3d ed. April 2018); see also Brown v.
Felsen, 442 U.S. 127, 131 (1979) (res judicata “prevents litigation of all grounds for,
or defenses to, recovery that were previously available to the parties, regardless of
whether they were asserted or determined in the prior proceeding”). Whether matter
that was not raised in the previous action should have been raised “depends in part
on whether the same transaction or connected series of transactions is at issue, and
whether the same evidence is needed to support both claims.” Interoceanica Corp. v.
Sound Pilots, Inc., 107 F.3d 86, 90 (2d Cir. 1997); cf. Nasalok Coating Corp., 86
USPQ2d at 1372-73 (counterclaim is compulsory if it arises out of same transaction
or occurrence as the plaintiff’s claim).
In the cancellation proceeding, Opposer’s unpleaded abandonment defense is
based on the same transactions as Applicant’s claim of priority of use; specifically,
Applicant’s use (or nonuse) of the mark in commerce in connection with her goods.
Cf. Vitaline Corp. v. Gen. Mills, Inc., 891 F.2d 273, 13 USPQ2d 1172, 1174 (Fed. Cir.
1989) (plaintiff’s abandonment and fraud claims based upon same transactional facts
– use of the mark on containers). Indeed, Opposer referred to Applicant’s evidence of
use to support the untimely defense. 4 TTABVUE 48-49. Thus, Opposer should have
timely asserted the abandonment defense in the earlier proceeding in its answer or
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an amended answer. In view thereof, to the extent that abandonment could have been
raised as a defense in the earlier proceeding, the claim is precluded in this case by
res judicata.12 See e.g., Mollohan v. Warner, 122 USPQ2d 1335, 1343 (S.D.W. Va.)
(abandonment through naked licensing waived by failing to timely raise it on
summary judgment in prior proceeding).
II. Conclusion
In view of the foregoing, Applicant’s motion for summary judgment based on res
judicata is GRANTED with respect to Opposer’s nonuse, failure to function, and
fraud claims. In addition, the motion is GRANTED with respect to the abandonment
claim to the extent Opposer could have raised its claim as a defense in the
cancellation proceeding.13
III. The Pleading
As noted above, upon review of the notice of opposition, the factual basis for the
abandonment claim is unclear because Opposer has failed to allege facts to support
the elements of an abandonment claim under Trademark Act Section 45, 15 U.S.C.
§ 1127. In order to set forth a prima facie case of abandonment, a plaintiff must plead

12 As discussed more thoroughly below, the factual basis for Opposer’s abandonment claim in
this case is unclear.
13 Because we have found that Opposer’s claims are barred by claim preclusion, a
determination on whether the claims are also barred by issue preclusion is unnecessary. We
note, however, that Opposer’s nonuse, failure to function, and fraud claims raise the issue of
Applicant’s use of her mark in commerce, that the issue was litigated in the cancellation
proceeding, that a determination of the issue was necessary to the judgment in the earlier
proceeding, and that Opposer had a fair opportunity to litigate the issue. Thus, the nonuse,
failure to function, and fraud claims would also be barred by issue preclusion. However, while
the issue of whether Applicant abandoned use of the mark could have been raised, it was not
actually litigated in the earlier proceeding.
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at least three consecutive years of discontinued use or must set forth facts that show
a period of non-use less than three years with an intent not to resume use. See
Imperial Tobacco Ltd. v. Philip Morris Inc., 899 F.2d 1575, 14 USPQ2d 1390 (Fed.
Cir. 1990); Otto Int’l Inc. v. Otto Kern GmbH, 83 USPQ2d 1861, 1863 (TTAB 2007).
In this case, Opposer’s allegation of abandonment is conclusory and unsupported by
factual allegations regarding a period of nonuse of at least three years or nonuse for
less than three years with the intent not to resume use.14
In addition, we find that Opposer has failed to allege facts which, if proved, would
establish Opposer’s standing to maintain the opposition proceeding. Pursuant to
Trademark Rule 2.104(a), 37 C.F.R. § 2.104(a), the notice of opposition must set forth
the reasons Opposer believes it will be damaged by the registration of the involved
mark. Although Opposer asserts that it will be damaged, Opposer fails to allege any
facts that would show that it has a “real interest” in the proceeding. See Empresa
Cubana del Tabaco v. Gen. Cigar Co., 111 USPQ2d 1058, 1062 (Fed. Cir. 2014). Under
the Lanham Act, standing requires only that a plaintiff have a reasonable belief that
it is likely to be damaged by the registration. See Cunningham v. Laser Golf Corp.,
222 F.3d 943, 55 USPQ2d 1842, 1844 (Fed. Cir. 2000) (showing of a direct commercial
interest sufficient to establish standing).
In view of the foregoing, we sua sponte dismiss the notice of opposition. See NSM
Resources Corp. v. Microsoft Corp., 113 USPQ2d 1029, 1039 n.19 (TTAB 2014) (Board

14 We note that none of the claims asserted in the notice of opposition were sufficiently
pleaded. The complaint consists primarily of Opposer’s arguments on summary judgment in
the cancellation proceeding.
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may sua sponte dismiss any insufficiently pleaded pleading). We grant Opposer leave
to amend the pleading, if warranted by the facts; that is, if Opposer can assert a claim
of abandonment that is not based on the same set of transactional facts on which a
defense could have been brought in the cancellation proceeding. Dragon Bleu (SARL)
v. VENM, LLC, 112 USPQ2d 1925, 1929 n.10 (TTAB 2014); see also, Intellimedia
Sports Inc. v. Intellimedia Corp., 43 USPQ2d 1203, 1208 (TTAB 1997). Accordingly,
Opposer is allowed until TWENTY DAYS from the mailing date of this order in which
to file an amended notice of opposition containing a legally sufficient pleading of
Opposer’s standing and a claim of abandonment under Trademark Act Section 45,
failing which the notice of opposition stands dismissed.
If Opposer files an amended notice of opposition, Applicant is allowed until
THIRTY DAYS from the filing date of the amended complaint to file her answer
thereto.
Proceedings are resumed. Conferencing, disclosure, discovery and trial dates are
reset as follows:
Deadline for Discovery Conference 10/1/2018
Discovery Opens 10/1/2018
Initial Disclosures Due 10/31/2018
Expert Disclosures Due 2/28/2019
Discovery Closes 3/30/2019
Plaintiff's Pretrial Disclosures Due 5/14/2019
Plaintiff's 30-day Trial Period Ends 6/28/2019
Defendant's Pretrial Disclosures Due 7/13/2019
Defendant's 30-day Trial Period Ends 8/27/2019
Plaintiff's Rebuttal Disclosures Due 9/11/2019
Plaintiff's 15-day Rebuttal Period Ends 10/11/2019
Plaintiff's Opening Brief Due 12/10/2019
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Defendant's Brief Due 1/9/2020
Plaintiff's Reply Brief Due 1/24/2020
Request for Oral Hearing (optional) Due 2/3/2020

In each instance, a copy of the transcript of testimony, together with copies of
documentary exhibits, must be served on the adverse party within thirty days after
completion of the taking of testimony. Trademark Rule 2.125.
Briefs shall be filed in accordance with Trademark Rules 2.128(a) and (b). An oral
hearing will be set only upon request filed as provided by Trademark Rule 2.129.