Law & Practice

UNITED STATES: THE EBONYS Decision Reveals TTAB’s Claim Preclusion Limits

Published: January 12, 2022

Brian B. Darville

Brian B. Darville Oblon, McClelland, Maier & Neustadt, LLP Alexandria, Virginia, USA Unfair Competition Committee


Scott Creasman Taylor English Duma LLP Atlanta, Georgia, USA Law Firm Committee

Following the maxim that “[t]he judgments of tribunals with limited jurisdiction have limited preclusive effect,” the Third Circuit held that Trademark Trial and Appeal Board (TTAB) judgments do not carry claim against subsequent infringement proceedings under Section 43(a) of the Lanham Act in an Article III court. Beasley v. Howard, 14 F.4th 226 (3rd Cir. 2021). Under claim preclusion, a final judgment on the merits is conclusive as to the rights of the parties on the decided claims.

The case of Beasley v. Howard involves a long-running dispute over the band name “The Ebonys.” David Beasley founded The Ebonys in New Jersey in 1969. William Howard joined the band in the mid-1990s, and Mr. Beasley obtained a New Jersey state service mark for THE EBONYS in 1997. Mr. Howard subsequently left the band and registered THE EBONYS as a federal trademark with the United States Patent and Trademark Office (USPTO or Office).

In 2013, Mr. Beasley petitioned to cancel Mr. Howard’s federal registration for THE EBONYS, claiming that the procurement of registration was fraudulent. The TTAB dismissed the petition for cancellation because Mr. Beasley failed to prove fraud.

In 2017, Mr. Beasley filed a second petition for cancellation with the USPTO asserting and requesting that the Office cancel the registration on likelihood of confusion grounds. The TTAB dismissed this second petition based on claim preclusion because Mr. Beasley’s claims either were or could have been brought in the first proceeding.

In April 2019, Mr. Beasley in federal court requested that the district court vacate ownership of the registration, award him monetary damages, and allow him to register his own THE EBONYS trademark. The district court granted Mr. Howard’s motion to dismiss on grounds of claim preclusion because Mr. Beasley’s claim relied on the same facts and legal theories asserted in the 2017 TTAB proceeding, notwithstanding that Mr. Beasley sought a damages remedy and injunctive relief he did not pursue at the TTAB.

The Third Circuit reversed in part based on the limited jurisdiction of the TTAB to adjudicate only decisions of registrability and the tribunal’s inability to adjudicate an award for monetary remedies for an unfair competition claim seeking damages for unlawful use of a mark. The court reasoned that a Section 43(a)(1)(A) infringement or “false association” claim requires a plaintiff to prove that the defendant’s use of a mark is likely to create confusion concerning the origin of goods or services. “Because the TTAB’s jurisdictional limits do not allow it to consider the full range of facts or grant the full range of remedies relevant to violations of section 43(a), cancellation proceedings before it do not have claim preclusive effect against section 43(a) lawsuits in federal district court.”

The Third Circuit also held that Mr. Howard cannot rely on incontestability as a defense to Mr. Beasley’s infringement claim because Mr. Beasley alleged a common or state law right in the THE EBONYS name predating Mr. Howard’s registration. Under Section 15 of the Lanham Act, incontestability cannot be asserted against a valid prior state or common law trademark right.

Finally, issue preclusion would preclude Mr. Beasley from relitigating the fraud on the USPTO claim.

The Third Circuit reversed in part and remanded the case for further proceedings.

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