§21(b) oppositions are not limited to issues presented to TTAB

In Aktieselskabet af 21 November 2001 v Fame Jeans Inc (Case 07-7105, April 29, 2008), the US Court of Appeals for the DC Circuit has held that a trademark opposition under §21(b) of the Lanham Act need not be limited to the issues presented before the Trademark Trial and Appeal Board (TTAB). 
Aktieselskabet af 21 November 2001 is a Danish clothing company that is part of the Bestseller A/S fashion group. Since 1990 Bestseller has marketed a line of denim trousers under the name Jack & Jones; it owns registrations for the mark JACK & JONES in 46 countries.
By the time Bestseller applied to register the mark in the United States, Fame Jeans Inc had already filed an intent-to-use application to register the same term. Bestseller opposed Fame’s application. The TTAB granted summary judgment in Fame’s favour on the grounds that:
  • Bestseller had not yet used the mark in the United States; and
  • its overseas use gave it no priority before the US Patent and Trademark Office (USPTO).
Bestseller then filed an opposition in federal district court under §21(b) of the Lanham Act, arguing that:
  • it had used the mark in the United States; and 
  • in any event, under principles of equity, the court should recognize its worldwide use since 1990 for priority purposes. 
Bestseller also claimed that at the time Fame filed its application with the USPTO, it had no good-faith intention to use the mark in commerce. This latter argument had not been presented to the TTAB.
The district court dismissed the complaint, concluding that Bestseller could not present new grounds for opposition which had not been presented before the TTAB. Bestseller appealed.
The DC Circuit, drawing a distinction between actions initiated in district court under §21(b) and appeals of TTAB decisions to the US Court of Appeals for the Federal Circuit, held that district courts may entertain issues in §21(b) actions that have not been presented to the TTAB. The court reasoned that a §21(b) case is a new action, not an appeal of a TTAB decision. The DC Circuit contrasted a §21(b) action with a direct appeal from the TTAB to the Federal Circuit, where the USPTO transmits its record to the court, which is the record for the appeal:
By contrast, in a §21(b) action, the USPTO does not automatically transmit its record to the court; rather, any party may, on its own motion, enter the record into evidence. […] The district court then decides de novo whether the application at issue should proceed to registration, or the registration involved should be cancelled, or such other matter as the issues in the proceeding require, as the facts in the case may appear.”
Paul Devinsky, McDermott Will & Emery, Washington

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