The Moral of B&B Hardware: Companies Need to Be Strategic in Trademark Actions Before the TTAB

DOUGLAS MASTERS Loeb & Loeb

In its second trademark law decision of the term, the U.S. Supreme Court considered a core trademark issue: how the "likelihood of confusion" analysis in registration proceedings fits into the broader trademark protection landscape. The specific issue before the Court in B&B Hardware v. Hargis Industries¹ was whether decisions made by the Trademark Trial and Appeal Board (TTAB) in trademark registration procedures can bind federal courts in subsequent Lanham Act infringement cases under the concept of issue preclusion, otherwise known as collateral estoppel. The Court, ruling 7-2, rejected the Eighth Circuit’s categorical rule against issue preclusion, instead holding that TTAB rulings can indeed be binding—but only when all of the usual issue preclusion principles are satisfied.

As both the protracted litigation history of this case and the Supreme Court’s decision evidence, corporate counsel should expect to devote more attention—and, probably, more resources—to registration proceedings. First, the possibility that issue preclusion can apply to trademark oppositions and cancellations means that companies will be more strategic in framing their trademark applications. Counsel are also likely to see the costs of registration proceedings increase as the stakes of litigation in that forum takes on greater impact.

The B&B Hardware case reached the Supreme Court after more than two decades of battles in the courts and before the TTAB between the parties, two manufacturers of industrial fasteners. B&B Hardware makes a fastener product for the aerospace industry under the name SEALTIGHT, while Hargis makes screws for the construction industry under the SEALTITE mark (which facts prompted Justice Alito to note, somewhat dryly, in his majority opinion, that while the companies cater to different industries, "both B&B and Hargis want their wares associated with tight seals."²).