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Tequila Cazadores S.A. de C.V. v. Bacardi & Co. Limited

March 29, 2007

TEQUILA CENTINELA, S.A. DE C.V., PLAINTIFF,
v.
BACARDI & COMPANY LIMITED, DEFENDANT.



The opinion of the court was delivered by: Royce C. Lamberth, United States District Judge

MEMORANDUM OPINION

This matter comes before the Court on the defendant's Partial Motion [17] to Dismiss. Upon consideration of the defendant's motion, the plaintiff's opposition [19] thereto, the defendant's reply [22] brief, the applicable law, and the entire record herein, the Court concludes that the defendants' motion will be DENIED in part and GRANTED in part. The Court agrees with the plaintiff's contention that this Court has the power to review the rulings of the Trademark Trial and Appeal Board ("TTAB") with regard to all matters except that of the TTAB's denial of Centinela's motion for summary judgment on the issue of confusion and no dilution. The Court's reasoning is set forth below.

BACKGROUND

On August 21, 2000, the plaintiff, Tequila Centinela, S.A. de C.V., (Centinela) filed Application Serial No. 76/112,825 to register with the United States Patent and Trademark Office the "CABRITO and (Goat)" design for alcoholic beverages, excluding beer, but including tequila. (Def. Mot. Dismiss 2; Pl.'s Opp'n Mot. 2.) On May 9, 2002, registration was opposed by Tequila Cazadores S.A. de C.V. (Cazadores) on the grounds that Centinela's "CABRITO and (Goat)" design so resembled its previously used and registered mark "CAZADORES" (U.S. Reg. No. 1,863,882)*fn1 for "'alcoholic beverages, namely, tequila' and its common law mark for tequila, as to likely cause confusion, or to cause mistake[,] or to deceive, or to dilute the distinctive quality of Cazadores' 'CAZADORES' marks." (Def. Mot. Dismiss 2.) In May of 2002, Bacardi became the successor-in-interest to Cazadores' rights in "CAZADORES." (Id.) On June 24, 2002, Centinela answered Cazadores' notice of opposition. (Pl.'s Opp'n Mot. 2.)

On August 30, 2002, prior to any asserted claim of fraud, Centinela moved before the TTAB to amend their application, revising the dates of first use and narrowing the identification of goods. (Id.) Later, on September 4, 2002, Bacardi moved before the TTAB to substitute itself as the party-plaintiff in the Opposition, to amend the notice of opposition to assert a claim that the "CABRITO and (Goat)" application was fraudulently filed, and for summary judgment based upon the amended claim of fraud. (Def. Mot. Dismiss 2; Pl.'s Opp'n Mot. 2.) Subsequently, on November 1, 2002, Centinela moved before the TTAB for summary judgment on the grounds that there were no likelihood of confusion and no dilution as between Centinela's "CABRITO and (Goat)" design and the "CAZADORES" design. (Def. Mot. Dismiss 3; Pl.'s Opp'n Mot. 3.)

On March 5, 2003, the TTAB denied Bacardi's motion to substitute itself as a party-plaintiff on the grounds that Bacardi had failed to submit sufficient documentary evidence in support of its assertion that it was the assignee of the marks. (Def. Mot. Dismiss 3.) Thus, both Bacardi's motion to amend the notice of opposition and motion for summary judgment were given no consideration, as they were filed by a non-party entity to the proceedings. (Pl.'s Opp'n Mot. 3.) In ruling on the previous motions made by Centinela, the TTAB deferred ruling on Centinela's previous motion to amend the "CABRITO and (Goat)" application until there was a final disposition of the opposition to register the mark or until the proceeding was decided on summary judgment. (Id.) The TTAB also denied Centinela's motion for summary judgment on the grounds that there was no likelihood of confusion and no dilution between the parties' marks. (Id.)

Bacardi, on April 15, 2003, renewed its motions to substitute itself as a party-plaintiff, to amend its notice of opposition, and for summary judgment on the issue of fraud. (Id.) Bacardi also provided supplemental documentation to the TTAB to establish its ownership of the marks cited in the Opposition. (Id.) In its Decision and Order of February 24, 2004, the TTAB allowed Bacardi to join as a party-plaintiff with Cazadores, but deferred decision on Bacardi's standing, giving Bacardi sixty days to supply sufficient documentation to prove Bacardi's chain of title to the "CAZADORES" marks. (Def. Mot. Dismiss 3; Pl.'s Opp'n Mot. 4.) The TTAB also granted Bacardi's motion for summary judgment on the grounds that the "CABRITO and (Goat)" application was fraudulently filed. (Id.) The TTAB found fraud in Centinela's application because Centinela claimed to be displaying the design on more goods in its use-based application than it actually was displaying at the time of filing the application. (Pl.'s Opp'n to Mot. 4.) The TTAB further stated that Centinela's attempt to narrow the identification of goods in the "CABRITO and (Goat)" application did not cure the original fraudulent filing. (Id.)

On October 19, 2004, the TTAB issued a Decision and Order granting Bacardi's motion for summary judgment on the issue of its standing. (Pl.'s Opp'n Mot. 4.) In that Decision and Order, the TTAB entered judgment against Centinela on the ground of fraud, sustained the Opposition, and refused registration of the "CABRITO and (Goat)" design mark. (Id.) Subsequently, on October 20, 2004, pursuant to Trademark Act Section 21(b)(1), 15 U.S.C. §1071(b)(1), Centinela filed a civil action in this Court seeking review and reversal of the March 5, 2003; February 24, 2004; and October 19, 2004, Decisions and Orders of the TTAB, to the extent that they were adverse to Centinela. (Id. at 5.)

Bacardi's present motion to dismiss is based upon the belief that this Court lacks the requisite subject matter jurisdiction to review all of the Decisions and Orders entered by the TTAB. (Def. Mot. Dismiss 3.) Bacardi does not contest that the questions of whether the TTAB correctly granted summary judgment on the issue of fraud or correctly granted Bacardi's motion to amend the notice of opposition to assert a claim of fraud is properly before this Court. (Def. Mot. Dismiss 5.) Rather, Bacardi's claim is that this Court lacks the requisite subject matter jurisdiction to review the TTAB's: Denial of Centinela's motion for summary judgment that there was no likelihood of confusion; denial of Centinela's motion to amend its application to narrow the identification of goods; granting of Bacardi's motion to join as a party-plaintiff; and finding that Bacardi had standing to bring and maintain the Opposition. (Id. at 5-8.) The basis for the Bacardi's claim is that pursuant to the jurisdiction granting statute, 15 U.S.C. §1071(b)(1), this Court may only review final decisions of the TTAB and not those which are interlocutory in nature. (Id. at 4-5.)

DISCUSSION

15 U.S.C. §1071(b)(1) permits any party dissatisfied with a decision of the TTAB, as an alternative to an appeal to the United States Court of Appeals for the Federal Circuit, to have remedy by a civil action. Thus, this Court sits as an appellate court to the TTAB and acting as such, applies a standard of review that is a hybrid of deferential treatment and de novo scrutiny. Mitchell Cosmetics SARL v. Pramil S.R.L. (Esapharma), 2005 WL 3273371, *2 (D.D.C.) (citing See Material Supply Int'l, Inc. v. Sunmatch Indus. Co., 146 F.3d 983, 989-90 (D.C. Cir. 1998)). Deferential treatment is granted to the TTAB's finding of facts, giving them great weight and not upsetting them unless new evidence is introduced which carries thorough conviction. Id. (citing Material Supply Int'l, Inc., 146 F.3d at 990 (quoting 3 J. Thomas McCarthy, McCarthy on Trademarks & Unfair Competition § 21:21, at 21-26 (4th ed. 1997)). However "because 'the district court is just as able as the TTAB to determine an issue of law,' review of legal questions is de novo." Id.

In its October 19, 2004, Decision and Order, the TTAB entered a final, dispositive, and appealable decision in favor of Bacardi. In relevant part, 15 U.S.C. §1071(b)(1) allows for any person authorized by 15 U.S.C. §1071(a) who "is dissatisfied with the decision of the Director or Trademark Trial and Appeals Board" to have remedy by a civil action if commenced within such time "after such decision." The term "decision," when used in the context of 15 U.S.C. §1071, has been interpreted to mean "a dispositive decision in which a right has been adjudicated." Wagner Shokai, Inc. V. Kabushiki Kaisha Wako, 699 F.2d 1390, 1391 (Fed. Cir. 1983) (citing United States Treasury v. Synthetic Plastics Co., 341 F.2d 157, 157 (CCPA 1965)). A dispositive, final decision, is one which ends the litigation on the merits and leaves nothing for the court to do but execute the judgment. Caitlin v. United States, 324 U.S. 229, 233 (1945). In the TTAB's October 19, 2004, Decision and Order, the TTAB effectively ended the case by stating: "Judgment is hereby entered against applicant on the ground of fraud, the opposition is sustained, and registration to applicant is refused." (Pl.'s Opp'n Mot. Exhibit D.) Furthermore, Bacardi admits that "the grant of summary judgment in Opposer's favor on the fraud issue is a final, dispositive and appealable decision of the Board which is properly before this Court for review." (Def. Mot. Dismiss 5.) Having found there to be a final decision of the TTAB properly before this Court, we must now shift our focus to the interlocutory decisions of the TTAB and determine this Courts ability to review such decisions.

A. The "Merger Doctrine" v. "Logically Related" Test

With exception of the TTAB's denial of summary judgment, this Court may review all of the decisions of the TTAB which were interlocutory when first issued because the interlocutory decisions ultimately merged with the final judgment, becoming reviewable. In their motion to dismiss and subsequent reply memorandum in support of their motion to dismiss, Bacardi argued that interlocutory decisions of the TTAB were only reviewable if "logically related" to the appealable final decision. See Palisades Pageants, Inc. v. Miss America Pageant, 442 F.2d 1385, 1388, 169 U.S.P.Q. 790 (CCPA 1971), cert. denied. 404 U.S. 938 (1971). Centinela, in their opposition to the motion to dismiss, claimed that when the TTAB entered its final judgment in the proceeding, its interlocutory rulings merged with the final judgment, making the final judgment and the interlocutory orders reviewable on appeal. This Court agrees with Centinela, that subject to the limitations of what is reviewable on appeal,*fn2 rulings which were interlocutory upon being issued, merge with the final judgment and are reviewable on appeal. See I.A.M. National Pension Fund Benefit Plan A v. Cooper Indus., Inc., 789 F.2d 21, 24 (D.D.C. 1986) (citing Aaro, Inc. v. Daewoo International (America) Corp., 755 F.2d 1398, 1400 (11th Cir. 1985)); see also Franklin v. District of Columbia, 163 F.3d 625, 629 (D.C. Cir. 1998) (explaining that a party is entitled to a single appeal, to be ...


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