1/
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`77798 ~
`
`06-24-2003
`US. Patent & TlV|OfcITM Mail Rep! 01. #64
`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`1
`
`8
`¢___ '
`
`%I
`
`Cancellation No. 92 041816
`
`In re Registration of:
`
`Joker, Inc.
`
`Serial No.: 74/435,499
`
`Registration No. 2,154,397
`Registration Date: May 5, 1998
`Mark: PINGU AND DESIGN
`
`Classes: 3, 4, 5, 6, 8, 9,11,12, 14, 15, 16,
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`18, 20, 21, 22, 24, 26, 27, 28, 29, 30, 31,
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`32, 35, 36, 38, 39, 41, and 42.
`
`\J\./\é\)\_/\J\J§/
`
`Commissioner for Trademarks
`2900 Crystal Drive
`Arlington, VA 22202-3514
`
`RESPONSE TO PE’I‘ITIONER’S MOTION TO STRIKE
`REGISTRANT’S AFFIRMATIVE DEFENSES
`
`5:.
`L7‘
`Inc., by its attorneys Davis, Mannix & McGrath, hegreby
`
`Registrant, Joker,
`
`responds to Petitioner’s Motion to Strike Affirmative Defenses. Petitioner’s motion is
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`without merit and must be denied. Petitioner’s argument that the affirmative defenses of
`
`laches and unclean hands are not available against a claim of abandonment does not
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`justify the striking of these defenses, since the petition for cancellation is based on
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`likelihood of confusion as well as abandonment. Petitioner has not demonstrated that a
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`1
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`defense of unclean hands is equivalent to a claim of “fraud on the Patent Office,” and
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`therefore, its alternate basis for striking the defense of unclean hands, i.e., that Registrant
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`should be held to the higher standard for pleading claims of fraud under Rule 9(b), is
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`unpersuasive. However, even if Registrant must plead unclean hands with specificity,
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`Registrant’s affirmative defense meets this standard. Finally, Petitioner’s assertion that
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`the affirmative defense of unclean hands is “factually deficient,” is unavailing when
`
`
`
`77798 ~
`
`06-24-2003
`US. Patent & TlV|OfcITM Mail Rep! 01. #64
`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`1
`
`8
`¢___ '
`
`%I
`
`Cancellation No. 92 041816
`
`In re Registration of:
`
`Joker, Inc.
`
`Serial No.: 74/435,499
`
`Registration No. 2,154,397
`Registration Date: May 5, 1998
`Mark: PINGU AND DESIGN
`
`Classes: 3, 4, 5, 6, 8, 9,11,12, 14, 15, 16,
`
`18, 20, 21, 22, 24, 26, 27, 28, 29, 30, 31,
`
`32, 35, 36, 38, 39, 41, and 42.
`
`\J\./\é\)\_/\J\J§/
`
`Commissioner for Trademarks
`2900 Crystal Drive
`Arlington, VA 22202-3514
`
`RESPONSE TO PE’I‘ITIONER’S MOTION TO STRIKE
`REGISTRANT’S AFFIRMATIVE DEFENSES
`
`5:.
`L7‘
`Inc., by its attorneys Davis, Mannix & McGrath, hegreby
`
`Registrant, Joker,
`
`responds to Petitioner’s Motion to Strike Affirmative Defenses. Petitioner’s motion is
`
`without merit and must be denied. Petitioner’s argument that the affirmative defenses of
`
`laches and unclean hands are not available against a claim of abandonment does not
`
`justify the striking of these defenses, since the petition for cancellation is based on
`
`likelihood of confusion as well as abandonment. Petitioner has not demonstrated that a
`
`1
`
`defense of unclean hands is equivalent to a claim of “fraud on the Patent Office,” and
`
`therefore, its alternate basis for striking the defense of unclean hands, i.e., that Registrant
`
`should be held to the higher standard for pleading claims of fraud under Rule 9(b), is
`
`unpersuasive. However, even if Registrant must plead unclean hands with specificity,
`
`Registrant’s affirmative defense meets this standard. Finally, Petitioner’s assertion that
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`the affirmative defense of unclean hands is “factually deficient,” is unavailing when
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`
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`made in the context of a motion to strike, and Petitioner’s attempt to prejudice the
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`Registrant by improperly filing deposition testimony from another proceeding without
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`leave of the Board should not be countenanced.
`
`1.
`
`is governed by
`The Motion to Strike Affirmative Defenses
`Fed.R.Civ.P. 12(f), and Petitioner has failed to show that the defenses
`clearly have no bearing on the case.
`
`Petitioner purports to move pursuant to Fed.R.Civ.P. 9(b), but that rule merely
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`sets forth the pleading standard applicable to claims for fraud and other matters. The
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`motion, styled “Motion to Strike Affirmative Defenses” must be decided under Rule
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`12(f), which provides that on motion or on its own initiative, a court may “order stricken
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`from any pleading any insufficient defense or any redundant, immaterial, impertinent, or
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`scandalous matter.”
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`The Board has made it clear that “motions to strike are not favored, and matter
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`will not be stricken unless such matter clearly has no bearing upon the issues in the case.”
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`Ohio State University v. Ohio University, 41 U.S.P.Q. 2d 1289, 1292 (TTAB 1999);
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`Trademark Trial and Appeal Board Rule 506.01. Registrant’s affirmative defenses
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`clearly are relevant to the issues in this case. See 37 CPR. §2.l14 (“An answer may
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`contain any defense,
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`including the affirmative defenses of unclean hands,
`
`laches,
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`estoppel, acquiescence, fraud, mistake, prior judgment, or any other matter constituting
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`an avoidance or affirmative defense”) As the Board in Ohio State noted, the purpose of
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`pleadings is to give fair notice of the asserted claims or defenses, and even if pleadings
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`are objectionable, the Board may decline to strike them where they will not prejudice the
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`adverse party. Id.
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`
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`Petitioner claims that since it bases its cancellation proceeding on abandonment,
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`the affirmative defenses of laches and unclean hands are unavailable to the Registrant.
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`This might be true if abandonment were the sole basis for the cancellation. However, the
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`petition is based on two different grounds. Paragraph 36 subparagraph (1) alleges that
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`the registration at issue has been abandoned and stands as an impediment to Karsten’s
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`pending applications; subparagraph (2) alleges that the mark so resembles Karsten’s
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`prior-registered mark that it is likely to cause confusion.
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`Unclean hands and laches are appropriate defenses to claims based upon
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`likelihood of confusion. See Estee Lauder v. Fragrance Counter, Inc., 52 U.S.P.Q. 2d
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`1786, 1788 (S.D.N.Y. 1999)(“unclean hands is recognized as a valid defense to an
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`appropriate trademark infringement or unfair competition case,”); The Tom Co. v. Grass
`
`
`Masters
`Inc., 2003 WL 255724 (TTAB 2003)(where opposer had maintained a
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`registration through filing a false statement regarding continued use, it could not rely on
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`the registration for any purpose); and Turner v. Hops Grill & Bar, Inc., 52 U.S.P.Q. 2d
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`1310 (TTAB 1999)(laches is available as a defense in a cancellation case based on
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`likelihood of confusion unless it is demonstrated that confusion is inevitable because the
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`marks are identical and the goods are essentially the same).
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`In the case upon which
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`Petitioner relies, the basis for cancellation was only abandonment. The Board explicitly
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`stated that the petitioner did not assert likelihood of confusion. American Vitamin
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`Products Inc. v. Dowbrands Inc., 22 U.S.P.Q.2d 1313, 1314 (TTAB 1992).
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`
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`2.
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`Registrant pled the affirmative defense of “unclean hands” with
`sufficient specificity.
`
`Petitioner’s entire argument regarding specificity of pleading is based on the
`
`faulty assertion that the affirmative defense in this case is equivalent to “fraud on the
`
`Patent Office.” However, its authorities do not support this contrivance. For example, in
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`Heidelberg Harris Inc. v. Mitsubishi Heavy Industries Inc., 42 U.S.P.Q.2d 1369 (N.D. Ill.
`
`1996), the court was dealing with allegations of fraud in the disclosure of prior art in a
`
`patent application, or “inequitable conduct.” The court found the defense deficient in that
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`there were no allegations of inequitable conduct at all in the answer in that case.
`
`Id. at
`
`1372. Inequitable conduct in a patent case is a claim with specific elements that have no
`
`relationship to the bona fide intent necessary to support a trademark application under
`
`§1(b). Rule 9(b) does not require heightened specificity with respect to matters of intent;
`
`to the contrary, it explicitly provides that “intent, knowledge, and other condition of mind
`
`of a person may be averred generally.” Fed.R.Civ.P. 9(b).
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`Significantly, Petitioner’s own authority makes it clear that a defense of unclean
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`hands does not necessarily involve fraud, and where it is not based on fraud, Rule 9(b)
`
`does not apply. Xilinx Inc. v. Altera Corp., 33 U.S.P.Q.2d
`
`1149, 1151 (N.D. Cal.
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`1994)(striking with leave to amend the defense of unclean hands because the Defendant
`
`failed to allege how the petitioner’s conduct related to the case).
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`Nonetheless, even if Registrant’s affirmative defense of unclean hands were
`
`viewed as being equivalent to “fraud on the Patent Office,” and if “fraud on the Patent
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`Office” claims must meet the Rule 9(b) specificity requirement for common law fraud as
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`Petitioner asserts, Registrant has clearly met
`
`this pleading requirement.
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`Petitioner
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`
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`discusses the merits of the affirmative defense at length in its brief; it does not purport to
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`be unaware of its nature. As such, Registrant’s pleading meets the standards for specific
`
`pleading, since it “suffices ‘to apprise the other party of what is being alleged in a manner
`19
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`sufficient to permit responsive pleadings’ as Rule 9 requires.
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`France Telecom S.A. v.
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`Novell Inc., 65 U.S.P.Q. 2d 1055, 1057 (D. Del. 2002), quoting 5 Charles Alan Wright &
`
`Arthur R. Miller, Federal Practice and Procedure, §1296 (1990).
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`Applicant’s affirmative defense of unclean hands clearly exceeds the level of
`
`specificity of the defense stated in Intel Corporation v. Hyundai Electronics America, 692
`
`F.Supp. 1113 (N.D. Cal. 1987) upon which Petitioner relies. There, the affirmative
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`defense of unclean hands to patent infringement was found to be deficient, but in that
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`case, the allegation was merely: “For the reasons stated above, this action is barred by
`
`Inte1’s unclean hands.” Id. at 1117, n. 4. The court held this was not sufficient because
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`“Intel should at least be notified of what the alleged defense of unclean hands refers to.”
`
`Ii
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`Registrant has been as clear as possible in alleging that: “Karsten is not entitled to
`
`the relief sought due to the equitable doctrine of unclean hands. Upon information and
`
`belief, Karsten lacks the bona fide intent to use in commerce some of the applications
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`cited in this Petition, including those cited in Paragraph 2, rendering those applications
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`void.” Petitioner is on notice that Registrant is challenging its bona fide intent to use in
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`commerce some of the marks cited in support of its petition for cancellation. Registrant
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`cannot be any more specific without the completion of discovery on this issue. This level
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`of pleading fully satisfies the most stringent notice pleading standard. And, as noted
`
`
`
`above, the Petitioner has already responded vigorously, so it clearly understands the
`
`defense.
`
`3.
`
`Petitioner improperly relies on discovery deposition testimony from
`another proceeding.
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`A “motion to strike will not be granted where the sufficiency of a defense depends
`
`on disputed issues of fact.” Tonka Corp. v. Rose Art Industries, Inc., 836 F.Supp. 200,
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`29 U.S.P.Q. 2d 1801, 1814 (D. N]. 1993). Petitioner’s motion clearly depends on the
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`Board’s deciding certain facts in Petitioner’s favor, because Petitioner has endeavored to
`
`support it with matters outside the pleadings. Therefore, even if the proffered evidence
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`were both admissible and properly before the Board,
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`the very fact that it has been
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`tendered would defeat the motion to strike.
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`A.
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`Exhibit A to the Petitioner’s motion is improper.
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`Petitioner relies upon and attaches to its motion an excerpt from a deposition
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`transcript in another proceeding. Registrant objects to the exhibit and requests that the
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`Board refuse to consider it. Testimony from a different proceeding may only be used
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`upon motion granted by the Board. 37 C.F.R. §2.122(f); TTAB Manual of Procedure
`
`§715. A discovery deposition from another proceeding could only be used in the instant
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`case if it had been used as trial testimony in the other case. TTAB Manual of Procedure
`
`. §715.
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`Even if the tendered exhibit consisted of testimonial evidence from this very case,
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`the motion to strike would have to be denied. The Board’s stated policy is “not to read
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`trial testimony and review evidence prior to submission of the case to a panel of judges
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`for final decision, and motions to strike which involve substantive matters are deferred
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`until final decision.” Genesco Inc. V. Martz, 66 U.S.P.Q.2d 1260, 1263 (TTAB 2003).
`
`
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`The sufficiency of the pleading in question is the only issue properly considered in
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`deciding a motion to strike. 1;
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`B.
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`Even if the exhibit were properly before the Board it would not
`establish Petitioner’s bona fide intent.
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`Finally, if the Board were to read the exhibit, it would learn that it hardly proves
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`what Petitioner claims.
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`Instead, the very pages cited by the Petitioner prove that the
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`deponent was only filing applications as instructed by Mr. John Solheim.
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`(Deposition of
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`Daniel Marquette, p. 28-29). As such, Mr. Marquette was incompetent to testify in
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`support of the intent of the Petitioner, and his deposition testimony does not help
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`Petitioner at all. The tendered evidence does not resolve the issue of whether Petitioner,
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`instead of having a good faith intention to use the marks in commerce, may have filed
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`many applicationsl
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`intending solely to improve its
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`settlement position with the
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`Registrant,
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`to impede Registrant’s other applications, or for some other improper
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`purpose. Nothing Petitioner has offered in the way of evidence or argument renders this
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`defense invalid.
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`Conclusion
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`Petitioner’s motion to strike the affirmative defenses of laches and unclean hands
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`is without merit.
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`Its arguments are legally insufficient
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`to demonstrate that
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`these
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`affirmative defenses are unavailable to the Registrant, and under Rule l2(f), only the
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`sufficiency of the pleading is at issue. Though factual issues may not be resolved on a
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`I Since May of 2002, Petitioner has filed at least fifty-seven trademark applications with the United States
`Patent and Trademark Office. Among these are two applications for the mark PING U (78/206741 and
`71/203835) and one for TESS (78/ 188422), which is the name of the USPTO’S online trademark
`information database. These are the types of “objective circumstances” that “may cast doubt on the bona
`fide nature of the intent or even disprove it entirely.” Salacuse v. Ginger Spirits, Inc., 44 U.S.P.Q. 1415,
`(TTAB 1997).
`
`
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`motion to strike, Petitioner improperly relies upon deposition testimony from another
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`proceeding without leave of the Board. Its motion should be denied.
`
`Respectfully submitted,
`
`JOKER, INC.
`
`One of Its Attorneys
`
`Date:
`
`073
`
`Marsha K. Hoover
`
`Kevin A. Thompson
`Davis, Mannix & McGrath
`125 S. Wacker Drive
`
`Suite 1700
`
`Chicago, IL 60606
`(312) 332-3033
`
`CERTIFICATE OF SERVICE
`
`I hereby certify that copies of the foregoing RESPONSE TO PETITIONER’S
`MOTION TO STRIKE AFFIRMATIVE DEFENSES were mailed first—class mail,
`postage prepaid to David Van Engelhoven, Esq., John D. Titus, Esq., The Cavanagh Law
`Firm, 1850 N. Central Avenue, Suite 2400, Phoenix, AZ 85004, and Thomas G. Watkins,
`Esq., 5330 E. Palomino Road, Phoenix, AZ 85018, attorneys of record for Petitioner, on
`June ._.",§3,_, 2003.
`
` egina Westry
`
`CERTIFICATE OF EXPRESS MAILING
`
`Express Mailing label number
`
`_ E L :1 LI 7 H I 7 [3 U 7 U S 0‘
`
`Date of deposit:
`
`gag Z
`
`25223
`
`I hereby certify that the foregoing RESPONSE TO PETITIONER’S MOTION TO
`STRIKE AFFIRMATIVE DEFENSES is being deposited with the United States Postal
`Service “Express Mail Post Office to Addressee” service on the date indicated above and is
`addressed to the Commissioner for Trademarks, 2900 Crystal Drive, Arlington, VA 22202-
`3514.
`_
`
`Re na Westry
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