Wednesday, December 28, 2011

Trademark cancelled for failure to respond in discovery

The topic of communication by email arose in this trademark case (Benedict v Super Bakery):

On July 25, 2007 Super Bakery filed a Petition for Cancellation of Mr. Benedict’s Registration No. 2,966,255 for G THE GOODYMAN, citing grounds of fraud and abandonment. Super Bakery served discovery requests on Mr. Benedict in January and February of 2008. On February 14, 2008 Mr. Benedict wrote to counsel for Super Bakery, requesting an extension of the response time to April 18, 2008. Mr. Benedict states that Super Bakery never re- sponded to this request. Super Bakery states that it re- sponded by email on February 21, 2008, agreeing to the requested extension and also requesting additional docu- ments. Mr. Benedict disputes this statement and points out that no substantiation of that email has been provided, and that the parties had been communicating by registered FedEx, not by email. In all events, no response to the discovery requests was made by Mr. Benedict.

As to rule interpretations, the CAFC noted:

We agree with Mr. Benedict that Rule 2.127(d) does not clearly present the interpretation with which the Board now endows it. Only if one reads the PTO “comment” does it become clear. The PTO “comment” is not stated in the rule as adopted; the Rule does not state that no suspension shall occur until the Board separately acts to impose it, and that any filing deadlines will remain in force despite the Rule’s prohibition on filing. The Rule does not state that the requirement that no papers should be filed does not come into effect when the summary judgment motion is filed, despite the Rule’s prohibition. This ambiguity does not support the extreme sanction of default judgment.


However, the default judgment is well supported without this event. There had been two years of failure to comply with discovery requests and orders. The Board discussed Mr. Benedict’s repeated non-compliance with Super Bakery’s discovery requests, as well as his non- compliance with the Board’s orders concerning discovery. Although the Board criticized the “meritless” motion for summary judgment as “an effort to further obstruct peti- tioner’s rights to obtain discovery under the Board’s rules, the Board’s order compelling discovery, and the Board’s order granting discovery sanctions,” 96 USPQ2d at 1136, the Board’s finding that “[t]here is no reason to assume that, given additional opportunities, petitioner will fulfill his obligations as a party to the proceeding,” id., is supported by the entire experience of this case. The question is whether it was an abuse of discretion for the Board to enter default judgment. See Merker Counter Co. v. Central Counter Co., 310 F.2d 746 (CCPA 1962) (“Rule 2.132(b) gives the board discretionary powers to grant or deny motions for judgment thereunder.”).


Due process standards guide and limit the acts and pro- ceedings of agency tribunals. See, e.g., Transp. Leasing Co. v. Dep’t of Employment Servs., 690 A.2d 487, 489 (D.C. 1997) ("an individual is entitled to fair and adequate notice of administrative proceedings that will affect his or her rights, in order that he or she may have an opportunity to defend his or her position"). In turn, the agency has the authority to assure diligent administration of the rights within its charge, by establishing and enforcing reasonable rules and procedures for disciplining non-compliance with its rules. Trademark Rule 2.120(g) provides that “if a party fails to comply with an order of the Trademark Trial and Appeal Board relating to disclosure or discovery . . . the Board may make any appropriate order, including those provided in Rule 37(b)(2) of the Federal Rules of Civil Procedure . . ."

The end result:

The possession of a trademark registration places a routine obligation on the possessor to participate in reasonable procedures concerning rights or interests affected by that registration. On the entirety of the record, the Board’s orders were reasonable, and within its authority in seeking to advance the proceedings. The remedy of default judgment was within the Board’s discretion in view of Mr. Benedict’s repeated failures to comply with established and reasonable procedures orders. The default judgment in this cancellation proceeding is affirmed.


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