In the 2014-2015 term the Supreme Court will decide at least two important trademark cases. (There's still time for them to add more.) Here's a quick preview of one of them:
In B&B Hardware, Inc. v. Hargis Industries, Inc., B&B (a manufacturer of sealing fasteners) owns the registered mark "SEALTIGHT," and Hargis (also a manufacturer of sealing fasteners) sought to register the mark "SEALTITE." The marks are associated with similar products, but the products move in different channels of trade.
This case is about the two ways in which parties, under the Lanham Act, can litigate the issue of whether one mark is "likely to cause confusion" with another -- and how these two proceedings may or may not impact one another. Parties can litigate the "likely to cause confusion" question before the Trademark Trial and Appeal Board (TTAB), in disputes over the registration of new marks. And they can also litigate this same question in court, in lawsuits for trademark infringement.
B&B opposed Hargis's effort to register its mark, claiming "SEALTITE" was likely to cause confusion with B&B's "SEALTIGHT," which was already registered. In fact, Hargis even admitted there had been incidents of actual customer confusion. The TTAB agreed and eventually declined to register Hargis's mark.
While this proceeding before the TTAB was ongoing, B&B also filed suit in federal court for trademark infringement. And after the TTAB concluded that Hargis's mark was likely to cause confusion, B&B sought summary judgment in the district court -- arguing that the TTAB's conclusion precluded the district court from concluding otherwise. But the district court refused to give preclusive effect to the TTAB's decision, and even refused to allow B&B to present the TTAB's decision to the jury, as evidence of the likelihood of confusion. And, in the end, the district court ruled against B&B, finding that there was no likelihood of confusion and no infringement.
The Eighth Circuit Court of Appeals affirmed the district court's decision, and rejected B&B's contention that the TTAB's decision should have had preclusive effect. The court of appeals based its decision on the fact that the TTAB's standard for determining whether a mark was "likely to cause confusion" was different from the Eighth Circuit's standard -- and the court noted that B&B's ability to successfully oppose the registration of Hargis's mark did not necessarily establish an ability to successfully sue for infringement.
But, as B&B points out in its petition for certiorari to the Supreme Court, the circuit courts are divided over this preclusion issue, and the Eighth Circuit's decision to deny preclusive effect to the TTAB's ruling conflicts with decisions in other circuits. The Supreme Court granted certiorari to resolve this disagreement among the lower courts.
Notably, the Supreme Court reversed 73% of the decisions it reviewed last term. The Court reviewed two decisions by the Eighth Circuit, and reversed them both.
Given the facts of this case, given the unsavoriness of having two adjudicating bodies (the TTAB and the district court) reach conflicting conclusions on the same question, and given the Supreme Court's penchant for resolving circuit splits through reversals, my prediction (for what it's worth) is that the Court will reverse the Eighth Circuit, and hold that the TTAB's administrative determination that Hargis's mark was "likely to cause confusion" should have precluded the district court from determining otherwise -- or, at the very least, that the district court should have deferred to the TTAB's determination, unless the court found strong evidence to rebut it.
The case has not yet been set for oral argument.