TTAB proceedings don't preclude trademark infringement cases - 3rd Circ

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REUTERS/Andrew Kelly

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  • Narrow TTAB proceedings don't block broader court case
  • 3rd Circuit aligns with 2nd and 9th Circuits in case over Philly soul band trademark

(Reuters) - In a dispute over the rights to the name of the Philadelphia soul band The Ebonys, the 3rd U.S. Circuit Court of Appeals ruled Friday that a Trademark Trial and Appeal Board proceeding doesn't preclude related trademark infringement claims.

The board's narrow jurisdiction over trademark registration issues prevents its decisions from barring broader infringement claims, U.S. Circuit Judge Michael Chagares wrote for a unanimous three-judge panel.

The appeals court therefore decided to revive The Ebonys founder David Beasley's trademark infringement claims against former bandmate William Howard in New Jersey federal court despite Beasley's failed attempt to cancel Howard's federal "Ebonys" trademark at the TTAB.

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Chagares said the decision puts the 3rd Circuit in line with the 2nd and 9th Circuits.

"Previously, practitioners faced a dilemma in whether to bring a limited proceeding before the Trademark Trial and Appeal Board, or run the risk of unlimited litigation in a civil infringement suit," Beasley's attorney Marty Schwimmer of Leason Ellis said in an email. "Both plaintiffs and defendants now have more flexibility in walking away from, defaulting or conceding a TTAB decision."

Howard's attorney, Moshe Lapin of the Lapin Law Firm, didn't immediately respond to a request for comment.

Beasley founded The Ebonys in 1969. The court said the band founded in Camden, N.J., helped establish the Philadelphia Sound, but "never reached the notoriety" of similar groups like the O'Jays.

Howard joined the band in the mid-1990s for several years. After Howard left the group, he obtained a federal trademark for the "Ebonys" name in 2012.

Beasley filed a petition to cancel the registration at the TTAB in 2013 arguing Howard defrauded the PTO, which the board dismissed. The board dismissed another Beasley petition in 2017, which also asserted fraud and added that Howard's mark would cause confusion with his New Jersey state "Ebonys" trademark.

Beasley sued Howard pro se in New Jersey federal court for trademark infringement in 2019, asking the court to vacate Howard's trademark ownership, order the PTO to register Beasley's federal "Ebonys" mark, and award him damages. U.S. District Judge Noel Hillman in Camden dismissed the case last year because the TTAB had litigated the same facts and legal theories.

On appeal, Beasley argued that claim preclusion didn't apply because the TTAB's jurisdiction is limited to trademark registration, and it can't decide broader questions of infringement and damages.

Chagares, joined by Circuit Judges Joseph Greenaway and Richard Nygaard, agreed with Beasley on Friday that the infringement claim should be revived.

"Because the TTAB has no jurisdiction to consider whether an infringer's use of a mark damages a petitioner seeking cancellation, and in turn cannot award any remedy beyond cancellation," Beasley's claim is "not one that could have been brought in a TTAB cancellation proceeding," Chagares said.

Chagares also said that finding preclusion would "penalize trademark holders who promptly oppose or seek to cancel an invalid mark" before filing a lawsuit in federal court.

The case is Beasley v. Howard, 3rd U.S. Circuit Court of Appeals, No. 20-1119.

For Beasley: Marty Schwimmer of Leason Ellis, John Welch of Wolf Greenfield & Sacks

For Howard: Moshe Lapin of Lapin Law Firm

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Blake Brittain reports on intellectual property law, including patents, trademarks, copyrights and trade secrets. Reach him at blake.brittain@thomsonreuters.com