Shenzhen Bao Ye Heng Industrial Development Co., Ltd.v.Paul Audio, Inc.

Trademark Trial and Appeal Board

Jun 30, 2014

No. 91213564 (T.T.A.B. Jun. 30, 2014)

WINTER

Mailed: June 30, 2014

Opposition No. 91206084 (parent)
Opposition No. 91213564

Shenzhen Bao Ye Heng Industrial
Development Co., Ltd.

v.
Paul Audio, Inc.

Before Bucher, Cataldo, and Gorowitz,
Administrative Trademark Judges.

By the Board:

Background

Paul Audio, Inc., applicant in the above-captioned proceedings (hereafter
“Paul Audio”), filed applications seeking registration of the stylized mark
shown below for various audio apparatus1 and for “wholesale distributorships

1 Application Serial No. 77312117, filed October 24, 2007, based on Paul Audio’s
alleged use in commerce, claiming December 31, 1993, as its date of first use
anywhere and date of first use in commerce, for the following goods: “audio
apparatus, namely, speakers, loud speakers, loud speaker boxes, speaker boxes, loud
speaker enclosures, speaker enclosures, amplifiers, mixers, equalizers, horns and
driver, audio related accessories, namely, adaptor cables, subwoofer/bass speakers,
stage speaker 2-way full range speaker, 3-way full range speakers, 4-way full range
speakers, tweeters, and head set receivers.”
UNITED STATES PATENT AND TRADEMARK OFFICE
Trademark Trial and Appeal Board
P.O. Box 1451
Alexandria, VA 22313-1451
General Contact Number: 571-272-8500
This Decision is not a
Precedent of the TTAB
Opposition Nos. 91206084 and 91213564
2
featuring audio apparatus; retail store and on-line retail store services all
featuring audio apparatus.”2

Shenzhen Bao Ye Heng Industrial Development Co., Ltd, opposer in each
proceeding (hereafter “Shenzen”), opposes registration of the referenced mark
in Opposition No. 91206084 on the grounds of likelihood of confusion,
abandonment, issue preclusion, dilution, and fraud, and in Opposition No.
91213564, on the grounds of likelihood of confusion, dilution, and fraud.3 Paul
Audio, in each case, has denied the salient allegations set forth in the
amended notice of opposition4 filed in Opp. No. 91206084 and in the notice of
opposition filed in Opp. No. 91213564.5

2 Application Serial No. 85697706, filed August 7, 2012, based on Paul Audio’s
alleged use in commerce, claiming December 1, 1993, as its date of first use
anywhere and as its date of first use in commerce.
3 Although we do not take judicial notice of pending applications owned by the
parties, we note for purposes of this order only that Shenzen has also filed
trademark application Serial No. 85648979 (suspended in light of Paul Audio’s
Application Serial No. 77312117 (involved herein) and then Application Serial No.
85538919 which has since matured into Registration No. 4330324).
4 On March 24, 2014, in Opp. No. 91206084, the Board allowed opposer time to
replead its claims of abandonment, dilution, fraud, and non-use, as well as time to
replead allegations regarding collateral estoppel or issue preclusion. In accordance
with that order, opposer filed an amended pleading on April 11, 2014, which now
comprises sufficient claims of abandonment, dilution, and fraud, and also sets forth
sufficient allegations related to issue preclusion. Applicant has submitted its
amended answer in response thereto. Accordingly, the parties’ amended pleadings in
Opp. No. 91206084, submitted on April 11, 2014, and on May 14, 2014, respectively,
are hereby accepted and made of record, and are accepted as the parties’ operative
pleadings in Opp. No. 91206084.
5 Paul Audio has asserted by way of affirmative defenses that Shenzen has waived
and is “estopped” from asserting any rights or claims against Paul Audio based on
Shenzen’s acts or omissions. Inasmuch as these allegations are insufficient to
provide notice to Shenzen of the basis for the defenses, they are hereby stricken. See
Fed. R. Civ. P. 12(f). However, Paul Audio will be allowed time at the conclusion of
Opposition Nos. 91206084 and 91213564
3
Proceedings Consolidated
Opposition Nos. 91206084 and 91213564 involve the same parties and
common questions of law and fact, and the parties are represented by the
same counsel in both proceedings. It is therefore appropriate to consolidate
these proceedings pursuant to Fed. R. Civ. P. 42(a). See TBMP § 511 (2014).
Consolidation is discretionary with the Board, and may be ordered upon
motion granted by the Board, or upon stipulation of the parties approved by
the Board, or upon the Board’s own initiative. See, e.g., 9A Wright & Miller,
Fed. Prac. & Proc. Civ.2d § 2383 (2008); and Regatta Sport Ltd. v. Telux-
Pioneer Inc., 20 USPQ2d 1154 (TTAB 1991) (Board consolidated actions on its
own initiative). Acting on our own initiative, the above-noted opposition
proceedings are hereby CONSOLIDATED and may be presented on the
same record and briefs. The Board file will be maintained in Opposition No.
91206084 as the “parent” case.6 Although the parties will be allowed time to
conduct limited discovery in Opp. No. 91213564, the parties should no longer
file separate papers in connection with each proceeding. Only a single copy of
each paper should be filed by the parties and each paper should bear the case
captions as set forth above.
The Board will address the consolidated trial schedule in these
proceedings at the conclusion of this order.

this order to amend its answer to assert sufficient allegations with respect to any
possible waiver or estoppel defenses.
6 The parties should promptly inform the Board in writing of any other related inter
partes proceedings. See Fed. R. Civ. P. 42(a).
Opposition Nos. 91206084 and 91213564
4
Opposer’s Motion for Partial Summary Judgment in Opp. No. 91206084
These consolidated cases now come up for consideration of opposer’s fully
briefed motion7 (filed May 3, 2013,8 in Opp. No. 91206084) for partial
summary judgment on its claims of likelihood of confusion and abandonment,
and applicant’s uncontested motion (filed December 5, 2013, in Opp. No.
91206084) for leave to use testimony from another proceeding.9
For purposes of this order, the parties’ familiarity with the pleadings, and
arguments and materials submitted in connection with the summary
judgment motion is presumed.
Summary judgment is an appropriate method of disposing of cases in
which there is no genuine dispute with respect to any material fact, thus
leaving the case to be resolved as a matter of law. See Fed. R. Civ. P. 56(c)(1).
A party moving for summary judgment has the burden of demonstrating the
absence of any genuine dispute as to a material fact, and that it is entitled to

7 Shenzen submitted “evidentiary objections” comprised of seven pages and a “reply”
comprised of eight pages in response to Paul Audio’s responsive brief and materials,
which together total fifteen pages. A reply brief shall not exceed ten pages in length
in its entirety. Trademark Rule 2.127(a). Shenzen’s separation of its evidentiary
objections from its main “reply” will not be allowed to circumvent the prescribed
page limitation. In view thereof, Shenzen’s reply brief and objections have not been
given any consideration. See id. See also Saint-Gobain Corp. v. Minnesota Mining
and Mfg. Co., 66 USPQ2d 1220 (TTAB 2003).
8 Our consideration of opposer’s motion has been delayed by applicant’s combined
motion (filed on May 30, 2013) for discovery under Fed. R. Civ. P. 56(d) and for an
extension of time to file a response to opposer’s motion, as well as applicant’s
submission (on October 10, 2013) of a responsive brief which exceeded the proper
page length, a resulting Board order mailed on March 24, 2014, allowing opposer to
file an amended notice of opposition, and the time allowed for the parties to submit
their respective amended pleadings.
9 Paul Audio’s motion for leave to use testimony from another proceeding is granted
as conceded. Trademark Rule 2.127(a).
Opposition Nos. 91206084 and 91213564
5
judgment as a matter of law. See Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986); Sweats Fashions, Inc. v. Pannill Knitting Co. Inc., 833 F.2d 1560,
4 USPQ2d 1793, 1796 (Fed. Cir. 1987). A factual dispute is genuine if, on the
evidence of record, a reasonable fact finder could resolve the matter in favor
of the non-moving party. See Opryland USA Inc. v. Great American Music
Show Inc., 970 F.2d 847, 23 USPQ2d 1471, 1472 (Fed. Cir. 1992); Olde Tyme
Foods, Inc. v. Roundy’s, Inc., 961 F.2d 200, 22 USPQ2d 1542, 1544 (Fed. Cir.
1992).
Additionally, the evidence of record and all justifiable inferences that may
be drawn from the undisputed facts must be viewed in the light most
favorable to the non-moving party. See Lloyd’s Food Products Inc. v. Eli’s Inc.,
987 F.2d 766, 25 USPQ2d 2027 (Fed. Cir. 1993); and Opryland USA, 23
USPQ2d at 1472. Further, in considering whether summary judgment is
appropriate, the Board may not resolve genuine disputes as to material facts
and, based thereon, decide the merits of the opposition. Rather, the Board
may only ascertain whether any material fact cannot be disputed or is
genuinely disputed. See Lloyd’s Food Products, 25 USPQ2d at 2029; and Olde
Tyme Foods 22 USPQ2d at 1542.
• Abandonment and Issue Preclusion
We turn first to the question of whether there is a genuine dispute as to
whether Paul Audio abandoned its mark C-MARK. To make this
determination, we must consider whether Opp. No. 91206084 is subject to
Opposition Nos. 91206084 and 91213564
6
issue preclusion with respect to our decision in Cancellation No. 92049924.
Under the doctrine of issue preclusion or collateral estoppel, if an issue is
actually and necessarily determined by a court of competent jurisdiction, that
determination is conclusive in a subsequent suit involving the same issue and
the same parties, or at least the party against whom the same issue was
adversely determined. Daimler Chrysler Corp. v. Maydak, 86 USPQ2d 1945,
1948 (TTAB 2008). The requirements which must be met for issue preclusion
are: 1) the issue to be determined must be identical to the issue involved in
the prior litigation; 2) the issue must have been raised, litigated and actually
adjudged in the prior action; 3) the determination of the issue must have
been necessary and essential to the resulting judgment; and 4) the party
precluded must have been fully represented in the prior action. See, e.g.,
Mayer/Berkshire Corp. v. Berkshire Fashions Inc., 424 F3d 1229, 76 USPQ2d
1310, 1313 (Fed. Cir. 2005); Mother's Restaurant Inc. v. Mama's Pizza, Inc.,
723 F.2d 1566, 221 USPQ 394, 397 (Fed. Cir. 1983); and Polaroid Corp. v. C
& E Vision Services Inc., 52 USPQ2d 1954 (TTAB 1999).
Based on our review of the parties’ arguments and the evidence10
submitted by the parties, and drawing all inferences in favor of Paul Audio,
the non-movant, we find that the issue of whether Paul Audio abandoned the
mark C-MARK was raised, litigated and fully adjudicated by the Board in

10 The record in this case is extensive, and Paul Audio has interposed numerous
evidentiary objections. We have considered the objected-to evidence, keeping in mind
the objections, and have accorded it whatever probative value it merits.
Opposition Nos. 91206084 and 91213564
7
Cancellation No. 92049924. The respondent in that cancellation proceeding,
Baoning Zhou, shown to be a majority shareholder of Shenzen, alleged that
Paul Audio, Inc. (petitioner in the cancellation) abandoned its C-MARK mark
“with intent to abandon” (respondent’s answer ¶4; Board’s final decision at
20). Although that panel of the Board initially determined that Paul Audio
had priority, it found that the last documented use of the mark C-MARK by
Paul Audio was at the 2004 NAMM trade show (final decision at 17, 20); that
Paul Audio had not used the mark C-MARK for more than three years, and
that there was no evidence of Paul Audio’s intent to resume use (final
decision at 20); therefore, the Board held that Paul Audio had abandoned its
mark and that its claim of priority failed because it was based on a mark that
had been abandoned (Id.). Determination of the issue of whether Paul Audio
had abandoned its mark was necessary and essential to the resulting
judgment against it with respect to the priority element of Paul Audio’s
likelihood of confusion claim, and the parties were fully represented before
the Board. In view thereof, we are precluded from considering and re-
litigating the issue of whether Paul Audio abandoned its mark C-MARK. See
Jet Inc. v. Sewage Aeration Sys., 55 USPQ2d 1854 (Fed. Cir. 2000).
Accordingly, Shenzen’s motion for summary judgment on the basis that Paul
Audio abandoned its mark C-MARK is granted.

Opposition Nos. 91206084 and 91213564
8
• Priority and Likelihood of Confusion
Notwithstanding our ruling herein regarding the preclusive effect of the
Board’s earlier decision as to Paul Audio’s abandonment in Cancellation No.
92049924, we find it inappropriate at this juncture to conclude that Shenzen
is entitled to judgment in its favor as a matter of law on its claim of likelihood
of confusion. Based on our review of the parties’ arguments and the evidence
submitted by the parties, and drawing all inferences in favor of Paul Audio,11
the non-movant, we find that, at a minimum, there is a genuine dispute as to
material facts regarding ownership of the mark and priority of usage, such as
(i) the goods on which Shenzen initially used its mark (allegedly around
2006) and on which it has continuously used the mark C-MARK in commerce
since then; (ii) how it is that Shenzen can claim ownership and use of the
mark C-MARK anywhere as of 1993; (iii) any agreements or transactions
between the parties in the critical period of 2004 to 2007; and (iv) the exact
date claimed to be Shenzen’s first use of the mark C-MARK in commerce.12
Accordingly, opposer’s motion for summary judgment on its claim of priority

11 We have concerns regarding the credibility of the testimony presented by both
parties’ witnesses.
12 The fact that we identify several material facts that are genuinely in dispute as a
sufficient basis for denying the motion for partial summary judgment should not be
construed as a finding that these are necessarily the only issues which remain for
trial.
Opposition Nos. 91206084 and 91213564
9
and likelihood of confusion under Section 2(d) of the Trademark Act, 15
U.S.C. § 1052(d), is denied.13
Accelerated Case Resolution (“ACR”) and Protective Order
In view of the extensive record presented on the issues involved in these
proceedings, the challenges of translations into the English language,
questions about the quality and credibility of testimony for both parties, and
the ongoing, serial conflicts between the parties based upon a core set of
elusive facts, and a desire by this tribunal to resolve these disputes
satisfactorily, it is recommended that the parties consider utilizing
efficiencies available under the Board’s accelerated case resolution procedure
(“ACR”). The Board’s attorney assigned to Opp. No. 91206084, Ms. Elizabeth
Winter, is available at 571.272.9240 to conference with counsel of both
parties in the event that would help resolve these problems. As to efficiencies
specifically applicable under ACR, the parties may wish to stipulate to:
utilize some or all of their testimony and evidence already made of record at
summary judgment at final hearing; introduction of testimony and evidence

13 The parties are reminded that, absent the parties’ stipulation that the evidence
submitted in connection with opposer’s motion for summary judgment is to be
considered of record for trial, said evidence is of record only for consideration of the
motion for summary judgment. See TBMP § 501 (2014) and authorities cited therein.
See also TBMP § 702.04(d). Any such evidence to be considered at final hearing must
be properly introduced in evidence during their appropriate trial periods. See Levi
Strauss & Co. v. R. Joseph Sportswear Inc., 28 USPQ2d 1464 (TTAB 1993); Pet Inc.
v. Bassetti, 219 USPQ 911 (TTAB 1983); American Meat Institute v. Horace W.
Longacre, Inc., 211 USPQ 712 (TTAB 1981).
Opposition Nos. 91206084 and 91213564
10
by declaration or affidavit; or other efficiencies discussed online at the
following URL: http:// www.uspto.gov/trademarks/process/appeal/index.jsp.14
The parties are allowed until THIRTY (30) DAYS from the mailing date
of this order to file a stipulation to utilize ACR efficiencies, failing which the
proceedings will move forward on the schedule set forth below.
Whether or not the parties choose to use other efficiencies under ACR, it is
strongly recommended that the parties use testimonial affidavits for trial
(rather than testimonial depositions).
Further, the parties are reminded that the Board’s standard protective
order governs these proceedings; therefore, confidential and trade secret
materials may be protected under its terms (see order at the following URL:
http://www.uspto.gov/trademarks/process/appeal/guidelines/stndagmnt.jsp).
Opposition No. 91206084 Suspension Maintained; Trial Dates Reset
In view of the different stages of the two now consolidated proceedings,
Opp. No. 91206084 (“parent” proceeding) shall remain SUSPENDED until
pre-trial disclosures are due in Opp. No. 91213564 (“child” proceeding).
Paul Audio is allowed until FIFTEEN (15) DAYS from the mailing date
of this order to submit an amended answer in both proceedings that contains
sufficient allegations regarding its asserted “estoppel” and waiver defenses,
failing which said defenses shall be given no further consideration. After that

14 By way of example only, the parties may view ACR related stipulations and orders
in the following cases: 92054446 (see no. 20 in case history); and 91199733 (see nos.
12 and 18 in case history).
Opposition Nos. 91206084 and 91213564
11
due date, the parties are allowed NINETY (90) DAYS to conduct discovery
with respect to the parties’ respective claims and defenses in Opposition No.
91213564 only; and Opposition No. 91206084 shall resume and proceedings
shall move forward together when pre-trial disclosures are due.
Trial dates are reset as shown in the following schedule:
Deadline for Amended Answer 7/15/2014
Initial Disclosures Due in 91213564 8/14/2014
Expert Disclosures Due in 91213564 9/13/2014
Discovery Closes in 91213564 10/13/2014
Plaintiff’s Pretrial Disclosures Due 11/27/2014
Plaintiff’s 30-day Trial Period Ends 1/11/2015
Defendant’s Pretrial Disclosures Due 1/26/2015
Defendant’s 30-day Trial Period Ends 3/12/2015
Plaintiff’s Rebuttal Disclosures Due 3/27/2015
Plaintiff’s 15-day Rebuttal Period Ends 4/26/2015

IN EACH INSTANCE, a copy of the transcript of testimony, together
with copies of documentary exhibits, must be served on the adverse party
WITHIN THIRTY DAYS after completion of the taking of testimony. See
Trademark Rule 2.125, 37 C.F.R. § 2.125.
Briefs shall be filed in accordance with Trademark Rules 2.128(a) and (b),
37 C.F.R. §§ 2.128(a) and (b). An oral hearing will be set only upon request
filed as provided by Trademark Rule 2.129, 37 C.F.R. § 2.129.
Opposition Nos. 91206084 and 91213564
12
Appeal of Interlocutory Order
The parties are reminded that our decision granting partial summary
judgment is interlocutory in nature and may not be appealed until a final
decision is rendered in the proceeding. See Copeland’s Enterprises Inc. v.
CNV Inc., 887 F.2d 1065, 12 USPQ2d 1562 (Fed. Cir. 1989).
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