Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA475150
`ESTTA Tracking number:
`05/29/2012
`
`Filing date:
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`92054976
`Defendant
`VDF FutureCeuticals, Inc.
`
`VDF FUTURECEUTICALS INC
`819 NORTH DIXIE HIGHWAY
`MOMENCE, IL 60954
`UNITED STATES
`Other Motions/Papers
`Sharon D. Armstrong
`sbaird@winthrop.com, sarmstrong@winthrop.com, jrezac@winthrop.com,
`trademark@winthrop.com
`/sda/
`05/29/2012
`Motion for Reconsideration of Decision on Motion to Suspend.pdf ( 9 pages
`)(769153 bytes )
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`Proceeding
`Party
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`Correspondence
`Address
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`Submission
`Filer's Name
`Filer's e-mail
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`Signature
`Date
`Attachments
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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
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`Sandwich Isles Trading Co., Inc.
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`V.
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`Petitioner,
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`VDF FutureCeuticals, Inc.
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`Respondent
`_
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`\/\/H/\.d\/xas/€
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`Cancellation No. 92054976
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`MOTION FOR RECONSIDERATION OF DECISION ON MOTION TO SUSPEND
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`INTRODUCTION
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`Pursuant to 37 C.F.R. § 2.127(b) (2008), VDF FutureCeuticals, Inc. (“Respondent”)
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`moves the Trademark Trial and Appeal Board (“Board”) to reconsider its decision, dated April
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`26, 2012, on Sandwich Isles Trading Co., Inc.’s (“Petitioner”) Motion to Suspend for Civil
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`Action dated February 6, 2012 (the “Motion to Suspend”).
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`Respondent’s Motion for
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`Reconsideration is timely and Respondent respectfully requests that the Board grant the relief
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`requested herein}
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`II.
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`FACTS
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`Following are the facts already before the Board that are not in dispute:
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`. The parties are joined in a patent infringement action, brought by VDF, with a venue in
`the District of Hawaii (the “Hawaii Civil Action”). Response to Motion to Suspend,
`Exhibit 1.
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`. VDF did not assert any trademark infringement claims in the Hawaii Civil Action. Id.
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`trademark
`. VDF was and is unaware of any factual basis by which to support
`infringement claims against SITC. Response to Motion to Suspend, Exhibit 3, at 18.
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`1 The Board issued its Order on April 26, 2012. A Request for Reconsideration must be filed within one month of
`the issuance of the Order. As May 26, 2012 fell on a Saturday, and Monday, May 28, 2012 was a federal holiday,
`the final date for filing of Respondent’s Request for Reconsideration is Tuesday, May 29, 2012.
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`Page 1 of 8
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`SITC already has tried and failed to persuade the District of Hawaii to take jurisdiction
`‘ over SITC’s claims related to the validity of VDF’s COFFEEBERRY trademarks.
`Response to Motion to Suspend, Exhibit 5.
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`. The District Court specifically noted that VDF’s complaint “does not contain counts
`involving trademark infringement.” I_d. at 2.
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`. The District Court ruled that it had no jurisdiction to hear SITC’s trademark invalidity
`challenges. Response to Motion to Suspend, Exhibit 5.
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`. The District Court held that “there is no case or controversy concerning VDF’s
`trademarks.” 1d_. at 27.
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`. The District Court distinguished SITC’s “authority [that] concerns administrative
`petitions to cancel trademarks under 15 U.S.C. 1064. There is no case or controversy
`requirement for such petitions, so the authority is inapposite.” I_d. at 28.
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`. The District Court stated that “[i]t may well be that [SITC] can file an administrative
`petition to have VDF’s trademarks cancelled. It cannot, however, achieve that result in
`this court via an action for declaratory relief, unless it can show that there is an actual
`case or controversy.” I_d.
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`. The District Court further stated that “given that the court lacks jurisdiction over [the
`declaratory judgment trademark invalidity count] of the counterclaim because there is no
`actual case or controversy, and that the complaint against [SITC] does not include a
`trademark infringement claim, there is no pending ‘action involving a registered mark,’
`so the Court has no authority under Section l119 to cancel VDF’s trademarks.” Li. at
`29.
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`. On the same day the District Court dismissed both of SITC’s trademark claims from the
`Hawaii Civil Action, the District Court ordered that the case be administratively closed
`and it stayed the patent litigation pending the USPTO’s reexamination of the patents in
`issue. Response to Motion to Suspend, Exhibit 5 and Exhibit 6.
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`. On the same day, the District Court had advised it would not rule on any amended
`counterclaim that SITC might file until the USPTO completed the patent reexamination
`and the District Court stay is lified. Response to Motion to Suspend, Exhibit 5 at 5-6.
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`. Upon receipt of the District Court’s decision dismissing SITC’s declaratory judgment
`trademark invalidity claim and the trademark cancellation claim, both directed solely to
`validity, SITC immediately filed the Petition to Cancel, now before the Board. Response
`to Motion to Suspend, Exhibit 5 and Petition to Cancel.
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`.On average, patent reexamination at the USPTO takes over two years. Response to
`Motion to Suspend, at 4.
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`15. Knowing that it likely would be years before the District Court ever ruled on SlTC’s
`amended counterclaims, SITC again included the same trademark declaratory judgment
`validity challenges in its First Amended Counterclaim. Motion to Suspend, Exhibit A.
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`. SITC’s First Amended Counterclaim does not seek a declaration of non—infringement of
`VDF’s trademarks, nor does it seek a declaration of no unfair competition concerning
`VDF’s trademarks. Li.
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`. Knowing that its First Amended Counterclaim would not be joined in the patent
`litigation for years, if ever, and also knowing the Board’s strong inclination to suspend
`TTAB proceedings when the parties are involved in federal district court litigation that
`may have a bearing on the outcome of the TTAB action, SITC filed a motion to suspend
`the TTAB action. Motion to Suspend; Response to Motion to Suspend, Exhibit 5 and
`Exhibit 6.
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`ARGUMENT
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`Given the prevailing authorities, the Board erred in granting the contested Motion to
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`Suspend.
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`First, suspending the Cancellation in favor of a civil action that is administratively closed,
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`is currently stayed, and will remain stayed for an indetemiinable number of years, is contrary to
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`promoting the swifi determination of the registration claims before it. The Federal Rules of Civil
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`Procedure provide that “[t}hey should be construed and administered to secure the just, speedy,
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`and inexpensive determination of every action and proceeding.”
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`Fed. R. Civ. Pro. § 1.
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`Similarly, the TBMP provides that, “where there is no stipulation to suspend and it is not
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`possible for the Board to ascertain, prior to the filing of an answer in one or both proceedings,
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`whether the final determination of the other proceeding may have a bearing on the issues before
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`the Board,” suspension is inappropriate. TBMP § 510.02(a). Such is the case here.
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`Under the present undisputed facts, the Board is not in a position to ascertain whether a
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`final determination in the Hawaii Civil Action will have any bearing on the Cancellation
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`proceeding. Speculation that is contrary to settled law is required to assume that the final
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`determination of the patent litigation will have any bearing on SITC’s trademark claims, absent
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`Page 3 of 8
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`clear direction from the District Court
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`that it will actually take jurisdiction over SITC’s
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`trademark invalidity claims.
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`VDF submits that it is entitled to a “just, speedy, and inexpensive” adjudication of the
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`trademark claims asserted in the Cancellation, as the Federal Rules direct. Unfortunately, the
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`Board’s decision to suspend the Cancellation in favor of the stayed and administratively closed
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`Hawaii Civil Action is in error and does not promote the prompt resolution of these claims.
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`The Board cites Tokaido v. Honda Associates Inc., 179 USPQ 861 (TTAB 1973) in
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`support of its decision to suspend the Cancellation. However, Tokaido is distinguishable from
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`the present facts.
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`In Tokaido, the Board denied Respondent Honda’s first motion to suspend on
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`its initial consideration of the motion and on reconsideration too. The Board only granted
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`Honda’s second motion to suspend because Honda initiated a lawsuit seeking to enjoin Petitioner
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`Tokaido from moving forward with the cancellation proceeding at the TTAB and to obtain
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`injunctive relief concerning the mark in question. In Tokaido, the district court was charged with
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`adjudicating injunctive relief — a claim upon which the Board may not adjudicate — and whether
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`petitioner would even be allowed to pursue its cancellation before the TTAB — a claim that had
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`an obvious and clear bearing on the cancellation proceeding. Moreover, there was no suggestion
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`in the decision that the district court’s adjudication of these claims would be delayed, let alone
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`stayed and administratively closed for an extended period of years.
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`Here, in contrast, the Board has suspended the Cancellation and will forego adjudication
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`of SITC’s claims in favor of a district court action that is administratively closed for an indefinite
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`number of years. SITC has cast aspersions of invalidity on VDF’s trademark registrations, yet
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`appears content
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`to have them linger indefinitely — in both forums — without any timely
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`movement toward resolution. This highly unusual fact and circumstance is present in no
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`Page 4 of 8
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`authority cited by SITC or the Board in support of suspending the Cancellation in favor of the
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`administratively closed civil patent litigation.
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`The Board has suspended the Cancellation without any decision from the District Court
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`that it will actually hear the trademark claims in SITC’s First Amended Counterclaim. SITC has
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`already tried — and failed — to obtain jurisdiction over the identical invalidity and cancellation
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`claims at the District Court. Response to Motion to Suspend, Exhibit 5 at 28 (stating that SITC
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`cannot achieve cancellation of VDF’s marks in district court unless there is an actual case or
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`controversy, which SlTC’s original counterclaim failed to support). Afier dismissing SITC’s
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`trademark counterclaims, the District Court went on to issue its stay in the Hawaii Civil Action.
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`In its stay, the District Court’s discussion was limited to the consideration of what prejudice
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`VDF would sustain only in connection with the delay of adjudication of the patent claims; at no
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`time did it consider that SITC’s trademark claims remained part of the suit. See Response to
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`Motion to Suspend, Exhibit 6. VDF respectfully contends that the applicable rules do not
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`contemplate suspension of a Board proceeding in favor of a stayed civil action for which the
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`trademark claims were dismissed and a stay was issued in connection with the patent claims, as
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`such a suspension promotes unreasonable and unnecessary delay, rather than expeditious
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`resolution. Fed. R. Civ. Pro. § l. Moreover, the TBMP supports the conclusion that as the
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`Board cannot ascertain whether a final decision in the Hawaii Civil Action will have a bearing on
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`the Cancellation until it is clear that the District Court will hear SITC’s trademark claims,
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`suspension of the Cancellation is erroneous. TBMP § 5l0.02(a).
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`Second, jurisdiction regarding the validity of VDF’s registrations belongs with the Board
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`—- not with the District Court. The Board’s Order recognizes that “[t]he parties do not dispute
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`that the claims in the Board proceeding and the civil action overlap...SlTC is seeking a
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`Page 5 of 8
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`declaratory judgment of the invalidity of VDF’s registrations as ‘not valid or protectable’ and
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`seeks cancellation on the basis of genericness or descriptiveness (not having acquired
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`distinctiveness), which are the same claims asserted in this Board proceeding.” Order on
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`Motion to Suspend, at 3 (emphasis added). However, VDF submits that the Board erred in not
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`recognizing that primary jurisdiction over claims of registrability resides with the Board under
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`the very unique and undisputed facts of this case.
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`At no time has SITC pled a claim for non—infringement of VDF’s COFFEEBERRY
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`marks — let alone unfair competition, state trademark claims, breach of a license or any other
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`claim that touches upon VDF’s trademark registrations. “Although federal courts may determine
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`the validity of trademark registrations that are otherwise before them, e. g., in an infiingement
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`dispute, the courts do not have ‘jurisdiction under the Declaratory Judgment Act to determine the
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`validity of [a] trademark where there is no issue of infringement.” Wham-0, Inc. v. Manley
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`Toys, Ltd, 2009 WL 6361387 *3, 92 USPQ2d 1750 (C.D. Cal. 2009); see also 6 J.Thomas
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`McCarthy, McCarthy on Trademarks and Unfair Competition § 32:54 (4th ed. 1996)
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`(recognizing the concurrent jurisdiction of a court to cancel a trademark registration, but
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`clarifying that “such authority has been distinguished as applying only to a situation where there
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`is some ground of federal jurisdiction apart from the claim for cancellation”).
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`It is well-settled
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`that, in disputes such as this one, and regardless of the fact that the District Court has yet to rule
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`on VDF’s motion to dismiss SITC’s First Amended Counterclaim, jurisdiction of claims limited
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`to VDF’s rights in its registrations belongs squarely — and exclusively — with the Board.
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`VDF recognizes that “[i]f the final determination in a civil action will have a bearing on
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`the issues before the Board, the Board generally will suspend proceedings in the case pending
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`before it.” Order on Motion to Suspend, at 3. However, VDF urges the Board to consider the
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`unique facts and procedural history of the case before it, which do not support that the Hawaii
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`Civil Action will in fact have any bearing on this Cancellation.
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`It is not in spite of, but because
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`oi the fact that the claims in SITC’s First Amended Counterclaim and this Cancellation are
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`identical that jurisdiction is properly before the Board and not with the District Court.
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`In its
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`Order, the Board cites a number of decisions in which it has suspended a Board proceeding in
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`favor of adjudication of a jurisdictionally proper case; in virtually all of the cases cited, the
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`parallel civil litigation involved a properly pled claim of infringement or other independent basis
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`for jurisdiction over the disputed trademark rights. Order on Motion to Suspend, at 3-4.2 Here,
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`SITC has already tried — and failed — to obtain jurisdiction over the identical invalidity and
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`cancellation claims at the district court. Response to Motion to Suspend, Exhibit 5 at 28 (stating
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`that SITC cannot achieve cancellation of VDF’s marks in district court unless there is an actual
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`case or controversy, which SlTC’s original counterclaim failed to support). There are no new
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`facts in SITC’s First Amended Counterclaim that support trademark jurisdiction at the District
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`Court.
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`Indeed, despite taking a second bite at the apple, SITC is still unable to allege the facts
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`necessary to support a bona fide trademark case or controversy in the patent litigation that is
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`necessary for resolution by an Article III District Court.
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`2 See Goya Foods, Inc. v. Tropicana Products, Inc., 846 F.2d 848, 850, 6 USPQ2d 1950, 1951 (2nd Cir. 1988)
`(“Goya filed a complaint in the Southern District of New York seeking a declaration that it had not infringed
`Tropicana's trademarks and cancellation of Tropicana's registration for TROPI”); see also Tuvaclze, Inc. v. Emilio
`Pucci Perfumes International, Inc., et al., 152 USPQ 547, 575 (DC NY, 1967) (“The gravamen of the complaint,
`which was filed on December 8, 1965, is that the mark ‘Vivara’ infringes plaintiffs registered mark ‘Tuvara’); see
`also Wlzopper-Burger, Inc. V. Burger King Corporation, 171 USPQ 805 (TTAB 1971) (petitioner alleged prior use
`of the mark “WHOPPER” in seeking to cancel respondent’s registration for “HOME OF THE WI-IOPPER”); see
`also Tokaido v. Honda Associates Inc., 179 USPQ 861, 862 (TTAB 1973) (“respondent seeks additional injunctive
`relief bearing on the designation ‘TOKAIDO’”). The information available regarding the civil action underlying
`General Motors Corp. v. Cadillac Club Fashions, Inc., 22 USPQ2d 1933 (TTAB 1992), General Motors Corp. v.
`Cadillac Club Fashions, Inc., 1993 WL 125148 (S.D. Fla. April 6, 1993), is limited, with the documentation
`available via Westlaw stating only, “Opinion Vacated in Part; Case Settled.”
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`Page 7 of 8
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`In light of the above, Respondent respectfully requests that the Board grant its Motion for
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`Reconsideration of Decision on Motion to Suspend and further grant Respondent the relief
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`identified in the Motion.
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`Dated: May 29, 2012
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`6941 S76v4
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`Respectfully submitted,
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`WINTHROP & WEINSTINE, P.A.
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`/‘
`, Stephen R. Baird
`Sharon D. Armstrong
`
`225 South Sixth Street, Suite 3500
`
`Minneapolis, MN 55402
`(612) 604-6400 (Telephone)
`(612) 604-6800 (Facsimile)
`ATTORNEYS FOR RESPONDENT
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`VDF FUTURECEUTICALS, INC.
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`Page 8 of 8
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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`Sandwich Isles Trading C0,, Inc.,
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`Petitioner,
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`V.
`
`VDF FutureCeuticals, Inc.,
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`Registrant.
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`\/\-./\-/%/\u/$/%/\./%/\/
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`Cancellation No. 92054976
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`CERTIFICATE OF SERVICE BY FIRST CLASS MAIL
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`Sharon D. Armstrong declares that on the 29th day of May, 2012, she mailed by United States
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`mail, first class postage thereon prepaid, a true and correct copy of:
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`1.
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`1. Motion for Reconsideration of Decision on Motion to Suspend
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`in the above-captioned action to the following address identified in the TTABVUE database to-
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`wit:
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`Martin E Hsia
`CADES SCHUTTE LLP
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`1000 Bishop Street, 12th Floor
`. Honolulu, Hi 9681 3
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`6952943vl
`
`haron D. Armstrong