CMDW, Inc.v.Anthony R. Falwell

Trademark Trial and Appeal Board

Sep 23, 2015

No. 92058689 (T.T.A.B. Sep. 23, 2015)

Baxley Mailed: September 23, 2015

Cancellation No. 92058689
CMDW, Inc.
v.
Anthony R. Falwell

Before Seeherman, Wellington, and Lykos,
Administrative Trademark Judges.

By the Board:

In an April 21, 2015 order, we vacated the Board’s February 9, 2015 order,1 and
stated that “the questions of (1) whether or not claim preclusion is applicable in this
case and, (2) if it is applicable, to what extent, should be considered before this case
goes forward.” Accordingly, we allowed Respondent until May 11, 2015 to file a
motion for summary judgment on his pleaded defense of claim preclusion.2
On May 11, 2015, Respondent filed a submission which is identified in the
ESTTA cover form therefor as a “Motion for Summary Judgment.” The text of

1 In the February 9, 2015 order, the Board deferred consideration of Petitioner’s motion to
compel and sua sponte determined that the allegations in the petition to cancel were barred
in part by the doctrine of claim preclusion (or res judicata), based on Opposition No.
91184128, in which Petitioner and Daniel Ryan Way (“Way”) opposed registration of
Respondent’s involved mark on the ground of fraud.

2 In that order, we stated that the motion for summary judgment should include a copy of
the pleadings and the final decision in Opposition No. 91184128.

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 decision is not a
precedent of the Trademark
Trial and Appeal Board.
Cancellation No. 92058689

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Respondent’s submission consists in its entirety of the following: “Registrant
ANTHONY R FALWELL (‘Respondent’) hereby responds to Board's order to file a
Motion for Summary Judgment on Respondent's pleating (sic) defense of Claim
Preclusion. Included in this motion is a copy of the pleadings and final decision in
the earlier Opposition No. 91184128.”3
Notwithstanding the threadbare nature of Respondent’s submission, we will
consider it as a summary judgment motion based on the pleadings and the final
decision in the earlier opposition and any documents already of record herein,
including those in the USPTO file for the involved registration. See Trademark Rule
2.122(b)(1) (USPTO registration file forms part of the record). Summary judgment
is appropriate where there are no genuine disputes as to any material fact, thus
allowing the case to be resolved as a matter of law. Fed. R. Civ. P. 56(c). The party
seeking summary judgment bears the initial burden of demonstrating the absence
of any genuine dispute of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317,
323 (1986); Sweats Fashions, Inc. v. Pannill Knitting Co. Inc., 833 F.2d 1560, 4
USPQ2d 1793, 1796 (Fed. Cir. 1987). A factual dispute is genuine if, on the evidence
of record, a reasonable fact finder could resolve the matter in favor of the non-
moving party. See Opryland USA Inc. v. Great American Music Show Inc., 970 F.2d
847, 23 USPQ2d 1471, 1472 (Fed. Cir. 1992); Olde Tyme Foods, Inc. v. Roundy's,
Inc., 961 F.2d 200, 22 USPQ2d 1542, 1544 (Fed. Cir. 1992).

3 Respondent’s submission includes proof of service upon Petitioner in compliance with
Trademark Rule 2.119(a).

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3
The evidence on summary judgment must be viewed in a light most favorable to
the non-movant, and all justifiable inferences are to be drawn in the non-movant's
favor. Lloyd's Food Products, Inc. v. Eli's, Inc., 987 F.2d 766, 25 USPQ2d 2027, 2029
(Fed. Cir. 1993). The Board may not resolve issues of material fact; it may only
ascertain whether issues of material fact exist. See id.
Under the doctrine of claim preclusion or res judicata, “a judgment on the merits
in a prior suit bars a second suit involving the same parties or their privies based on
the same cause of action.” Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326 n.5
(1979). “Claim preclusion refers to the effect of a judgment in foreclosing litigation
of a matter that never has been litigated, because of a determination that it should
have been advanced in an earlier suit. Claim preclusion therefore encompasses the
law of merger and bar.” Migra v. Warren City School Dist. Bd. of Educ., 465 U.S. 75,
77 n.1 (1984); Nasalok Coating Corp. v. Nylok Corp., 522 F.2d 1320, 86 USPQ2d
1369, 1371 (Fed. Cir. 2008). That is, a valid and final personal judgment rendered
in favor of the defendant bars another action by the plaintiff on the same claim; this
bar encompasses claims that were raised or could have been raised in the earlier
action. See Urock Network, LLC v. Sulpasso, 115 USPQ2d 1409, 1412 (TTAB 2015),
(citing Allen v. McCurry, 449 U.S. 90, 94 (1980)). Thus, under claim preclusion, a
plaintiff is barred from a “subsequent assertion of the same transactional facts in
the form of a different cause of action or theory of relief.” Vitaline Corp. v. General
Mills Inc., 891 F.2d 273, 13 USPQ2d 1172, 1173 (Fed. Cir. 1989). In view of the
foregoing, a second suit will be barred by claim preclusion if: (1) there is identity of
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4
parties (or their privies); (2) there has been an earlier final judgment on the merits
of a claim; and (3) the second claim is based on the same set of transactional facts as
the first. See Parklane, 439 U.S. at 326 n.5. However, “[i]f the claim did not exist at
the time of the earlier action, it could not have been asserted in that action and is
not barred by res judicata.” Aspex Eyewear Inc. v. Marchon Eyewear Inc., 672 F.3d
1335, 101 USPQ2d 2015, 2021 (Fed. Cir. 2012).
There are no genuine disputes that the parties are identical in Opposition No.
91184128 and the above-captioned proceeding, and that the opposition resulted in a
valid final judgment on the merits. Thus, the motion for summary judgment reduces
to an analysis of the transactional facts involved in the two proceedings. See
Restatement (Second) of Judgments Section 24 (1982) (defining “claim” as
encompassing rights and remedies arising out of the same set of transactional
facts).
In the earlier opposition, which was commenced on May 15, 2008, Petitioner4
alleged fraud based in part on Respondent’s nonuse of the PLAN B JEANS mark on
certain identified goods when he filed the amendment to allege use on September
26, 2003.5 It alleged, upon information and belief, that Respondent falsely averred

4 The opposition was brought by Way as well as by Petitioner herein. However, the
opposition was dismissed as to Way in the final decision, based on his apparent loss of
interest because he was not mentioned in the plaintiff’s final brief on the case. See
Opposition No. 91184128, final decision at 5. For ease of reference, we refer to the plaintiff
in that proceeding as Petitioner, and to the applicant as Respondent.

5 Petitioner specifically identified “shoes,” “boys clothing, namely, shorts,” and “men’s
clothing, namely, shorts” as goods that were not in use. Notice of opposition, paragraphs 7
through 9.
Cancellation No. 92058689

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in the amendment to allege use in support of the application for that registration
“that the [involved] mark was in use in commerce for all of the goods identified in
the application” and that “but for the false statement in the amendment to [allege]
use,” the examining attorney would not have approved the amendment to allege
use. Notice of opposition, paragraphs 12 and 13. In a May 3, 2011 final decision, the
Board dismissed the opposition, finding that Petitioner failed to prove the pleaded
fraud claim. The Board, however, remanded the application to the examining
attorney “to consider whether a refusal should be made on the basis that the mark
had not been used on all of the identified goods when the amendment to allege use
was filed, or whether certain of the goods should be deleted from the identification,
or whether the basis for the application should be changed to intent-to-use.” In an
October 14, 2011 response to an Office Action, Respondent narrowed the
identification of goods by deleting “shoes” therefrom. On November 22, 2011, the
registration which is the subject of the current proceeding issued.
In the proceeding now before us, Petitioner alleges that Respondent “has never
used” the involved mark in commerce on all of the identified goods, as amended on
October 14, 2011, following the termination of the earlier opposition. Petition to
cancel, paragraph 3. Petitioner further alleges, upon information and belief, that
Respondent has discontinued use of the involved PLAN B JEANS mark with no

The final decision states that Petitioner alleged fraud in a February 3, 2004 response to an
office action by stating in a declaration to support substitute specimens that the substitute
specimens were in use in commerce in association with the goods at least as early as the
application filing date. However, that fraud allegation was not pleaded in the notice of
opposition that Respondent included as an exhibit to its motion for summary judgment.

Cancellation No. 92058689

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intent to resume; that Respondent is not using the mark in commerce; and that
Respondent has abandoned the mark. Petition to cancel, paragraphs 4 through 6.
Petitioner asserts that, following the dismissal of the earlier opposition,
Respondent became employed as the creative director of “another denim line.” As
evidence of such employment, Petitioner submitted a photograph obtained from the
Internet showing Respondent with Miss Teen USA 2011, in which Respondent is
identified as the creative director of Chinese Laundry Denim.
In view of the evidence submitted by Petitioner regarding Respondent’s
activities following issuance of the decision in the earlier opposition, we find that
Petitioner has shown that there is a genuine dispute as to whether the
abandonment claim in this proceeding and the fraud claim in the earlier opposition
involve the same set of transactional facts and thus as to whether the doctrine of
claim preclusion bars that claim.
We further note that Petitioner, in paragraph 3 of the petition to cancel, may
intend to set forth a claim of partial nonuse. Petitioner states in its brief in response
that the fraud allegations in the earlier opposition were based on Respondent’s
failure to use the involved mark on all of the identified goods when he filed the
amendment to allege use in 2003. Thus, to the extent that Petitioner intends to
allege partial nonuse in the petition to cancel, there is no genuine dispute that such
a claim involves the same set of transactional facts as the earlier opposition and
that Petitioner could have asserted partial nonuse as a separate claim in the earlier
case. Cf. Vitaline Corp., 13 USPQ2d at 1173 (Fed. Cir. 1989) (“The abandonment
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theory clearly could have been brought in the original proceeding because Vitaline
had access to the affidavit and related specimens” when it filed its fraud
counterclaim”). Respondent’s narrowing of the identification of goods by the deletion
of “shoes” therefrom after the issuance of the final decision in the opposition does
not give Petitioner a second opportunity to plead the nonuse claim that it failed to
plead in the opposition because there is nothing regarding nonuse in the petition to
cancel that could not have been alleged in the opposition. See Int’l Nutrition Co. v.
Horphag Research, Ltd., 220 F.2d 1325, 55 USPQ2d 1492, 1494-95 (Fed. Cir. 2000).
In view thereof, Respondent’s motion for summary judgment is granted to the
extent that any nonuse claim is barred by the doctrine of claim preclusion, and
denied with regard to the abandonment claim.
Finally, we note that Petitioner’s pleading of the abandonment claim is legally
insufficient. See Fed. R. Civ. P. 12(b)(6). An abandonment claim requires an
allegation of either (1) at least three consecutive years nonuse, or (2) ultimate facts
which show less than three years of nonuse coupled with an intent not to resume
use. See Otto Int’l Inc. v. Otto Kern GmbH, 83 USPQ2d 1861, 1863 (TTAB 2007). In
paragraphs 4 through 6 of the petition to cancel, Petitioner alleges discontinuation
of use of the PLAN B JEANS mark and intent not to resume use, but alleges no
facts upon which either of those allegations are based. Factual statements and
allegations set forth only in motion briefs are not part of the pleading. In keeping
with Board practice, see TBMP § 503.03, Petitioner is allowed until twenty days
from the mailing date of this order to file an amended petition to cancel in which it
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repleads its abandonment claim,6 failing which this proceeding will be dismissed
with prejudice based on Petitioner’s failure to state a claim upon which relief can be
granted. See Fed. R. Civ. P. 12(b)(6).
In sum, IT IS HEREBY ORDERED:
1. Respondent’s motion for summary judgment on the defense of claim
preclusion is granted as to Petitioner’s apparent claim of nonuse;
2. Respondent’s motion for summary judgment on the defense of claim
preclusion is denied as to Petitioner’s abandonment claim; and
3. Petitioner is allowed until twenty (20) days from the mailing date of this
order to file, if appropriate, an amended petition to cancel in which it sets
forth a legally sufficient abandonment claim.
Proceedings otherwise remain suspended. The Board will consider Petitioner’s
motion to compel once the pleadings in this case are resolved.

6 Petitioner is reminded that any amended petition to cancel is subject to Trademark Rule
11.18(b). See also Fed. R. Civ. P. 11(b); TBMP § 527.02. Accordingly, Petitioner should not
assert an abandonment claim without knowledge of facts that support the claim or without
a good faith belief that evidence showing the factual basis for the claim is likely to be
obtained after a reasonable opportunity for discovery or investigation.