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4th Cir. Clears Two Paths for Repeat Trademark Ruling Reviews (1)

March 17, 2021, 7:22 PM; Updated: March 17, 2021, 9:12 PM

Snyder’s-Lance Inc.'s decision to appeal an administrative tribunal’s refusal to let it register a trademark for “Pretzel Crisps” to the Federal Circuit doesn’t mean it also had to file a subsequent challenge there, the Fourth Circuit said.

The U.S. Court of Appeals for the Fourth Circuit has never before considered whether a party can appeal a Trademark Trial and Appeal Board ruling to a district court if it had already appealed to the Federal Circuit. In an opinion by Judge James A. Wynn Jr., it held that such appeals are allowed, reversing a lower court ruling.

The ruling preserves both routes for parties challenging board decisions a second time.

The decision “is a positive addition to the TTAB practitioner’s arsenal,” trademark attorney John L. Welch, of Wolf, Greenfield & Sacks PC in Boston, said in an email.

Parties might prefer to go to district court, where they can raise new issues and submit new evidence, or pick the Federal Circuit if they are happy with the record at the TTAB, Welch said.

“The longer a party can keep both options open, the better,” Welch said.

Two Scenarios

Under the Lanham Act, the Federal Circuit has jurisdiction over appeals from the TTAB unless the dissatisfied party files a civil suit in district court. If the dissatisfied party files in the Federal Circuit, the winning party can insist that the case be filed in district court.

If the appeal is heard in the Federal Circuit, its review is limited to the TTAB record and its rulings become the law of the case, the court said. District courts can review cases de novo, and further development of the record is permitted, it said.

The court’s ruling ultimately may have a limited impact, trademark attorneys said.

The decision isn’t likely to lead to “forum shopping” after remand to the TTAB, Marsha G. Gentner, a trademark attorney at Dykema Gossett PLLC in Washington, said.

“The circumstances in which this might arise do seem fairly limited,” Gentner said in an email. The Fourth Circuit held that any particular issue decided by the Federal Circuit in the initial decision couldn’t be relitigated in a subsequent district court case, she said.

The ruling was the outcome most trademark practitioners expected in the case, trademark attorney Joel R. Feldman of Greenberg Traurig LLP in Atlanta said in an email. It will have a “minimal” effect on TTAB inter partes practice —"where the record is primarily contained within the TTAB proceeding and confidential and commercially-sensitive information can be kept from public view,” Feldman said.

Mark Still Generic

The TTAB twice sided with Frito-Lay North America Inc. in its bid to block Snyder’s-Lance’s registration of the trademark for use with a flat pretzel cracker.

When the TTAB first ruled that “Pretzel Crisps” was generic, Snyder’s-Lance appealed to the Federal Circuit. The court reversed saying the TTAB applied the wrong legal standard. On remand, the TTAB again ruled that the mark was generic.

Snyder’s-Lance appealed the second TTAB decision to the U.S. District Court for the Western District of North Carolina. The district court ruled that it didn’t have jurisdiction over the case because Snyder’s-Lance’s first appeal was to the Federal Circuit and any subsequent appeal of a TTAB decision in the case also had to go the Federal Circuit.

Although the Lanham Act is somewhat ambiguous on the point, its plain language generally supports Snyder’s-Lance’s reading, the Fourth Circuit said.

The statute says the Federal Circuit’s holdings apply to “further proceedings in the case,” which indicates Congress expected there to more proceedings, the court said. If all the proceedings in a case were to be in the Federal Circuit, the stipulation would be unnecessary, it said.

The district court’s holding also reads out of the statute the right of the winner in the TTAB to elect proceedings before the district court if the initial review was before the Federal Circuit, the court said.

The legislative history of the Lanham Act and holdings from the Seventh and Ninth circuits are consistent with the Fourth Circuit’s conclusion, it said.

Judges Paul V. Niemeyer and Henry F. Floyd joined the opinion.

Kirkland & Ellis LLP and Debevoise & Plimpton LLP represented Snyder’s-Lance. Pirkey Barber PLLC represented Frito-Lay.

The case is Snyder’s-Lance Inc. v. Frito-Lay N. Am. Inc., 4th Cir., No. 19-2316, 3/17/21.

(Updated with additional reporting throughout.)

To contact the reporters on this story: Perry Cooper in Washington at pcooper@bloomberglaw.com; Bernie Pazanowski in Washington at bpazanowski@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Steven Patrick at spatrick@bloomberglaw.com

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