Globefill Incorporatedv.Azul Imports Exports, LLC

Trademark Trial and Appeal Board

Feb 5, 2020

92071921 (T.T.A.B. Feb. 5, 2020)

LTS
February 5, 2020

Cancellation No. 92071921

Globefill Incorporated

v.
Azul Imports Exports, LLC

Before Taylor, Ritchie, and English,
Administrative Trademark Judges.

By the Board:

Now before the Board is Respondent’s motion, filed August 30, 2019, for summary
judgment on claim preclusion. The motion is fully briefed.1
I. Background
A. The Prior Proceeding
On May 21, 2019, Petitioner filed a petition to cancel in Cancellation No. 92071381
(the “Prior Proceeding”) against Respondent’s Registration No. 4790619 for the mark
for “tequila” in International Class 33.2 As grounds for cancellation, Petitioner

1 Respondent represents that it served its initial disclosures on August 30, 2019. 5 TTABVUE
4. Because the basis for Respondent’s motion for summary judgment is claim preclusion, the
motion is timely under Trademark Rule 2.127(e)(1) whether or not Respondent served its
initial disclosures prior to filing the motion.
2 Issued August 11, 2015.
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
General Email: TTABInfo@uspto.gov
THIS ORDER IS NOT A
PRECEDENT OF THE
TTAB
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pleaded a single claim of abandonment. 10 TTABVUE 5-8. In its answer, Respondent
denied the salient allegations in the petition to cancel. Id. at 10-14. On the same day
that Respondent filed its answer, Respondent served its initial disclosures and moved
for summary judgment on Petitioner’s abandonment claim. Id. at 15-79. On August
12, 2019, the Board granted Respondent’s motion for summary judgment as conceded
and denied the petition to cancel with prejudice. Id. at 85-86.
B. The Instant Proceeding
On July 31, 2019 (i.e., while Respondent’s motion for summary judgment was
pending in the Prior Proceeding), Petitioner filed a second petition to cancel in
Cancellation No. 92071921 (the “Instant Proceeding”) against the same registration
subject to the Prior Proceeding. As grounds for cancellation, Petitioner alleges
likelihood of confusion under Section 2(d) of the Trademark Act based on alleged prior
use and registration of the following marks (collectively, “Petitioner’s Marks”):
• for “alcoholic beverages, namely, vodka” in International Class
33;3

3 Registration No. 4043730; issued October 25, 2011; a Section 8 and 15 combined declaration
has been accepted and acknowledged.
Cancellation No. 92071921

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• for “distilled spirits; tequila” in International Class 33;4
• for “vodka” in International Class 33;5
• for “vodka” in International Class 33;6
• for “vodka” in International Class 33;7 and

4 Registration No. 4488813; issued February 25, 2014.
5 Registration No. 4195505; issued August 21, 2012; a Section 8 and 15 combined declaration
has been accepted and acknowledged.
6 Registration No. 4218759; issued October 2, 2012; a Section 8 and 15 combined declaration
has been accepted and acknowledged.
7 Registration No. 3942593; issued April 12, 2011; a Section 8 and 15 combined declaration
has been accepted and acknowledged.
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• for “vodka” in International Class 33.8
1 TTABVUE. On the ESTTA coversheet, Petitioner identifies the Prior Proceeding as
a “Related Proceeding,” providing the description: “same parties and registration,
different grounds for cancellation; currently suspended[.]” Id. at 2.
In its answer, Respondent denies the salient allegations in the petition to cancel
and asserts three affirmative defenses, including that Petitioner’s claim is barred by
claim preclusion. 4 TTABVUE. Concurrently with its answer, Respondent filed a
motion for summary judgment on claim preclusion. 5 TTABVUE.
II. Motion for Summary Judgment
A. Legal Standard
Summary judgment is appropriate only where there are no genuine disputes as to
any material facts, thus allowing the case to be resolved as a matter of law. Fed. R.
Civ. P. 56(a). The party seeking summary judgment bears the burden of
demonstrating the absence of any genuine dispute of material fact, and that it is
entitled to a judgment under the applicable law. See Celotex Corp. v. Catrett, 477 U.S.
317, 323 (1986); Sweats Fashions, Inc. v. Pannill Knitting, 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.

8 Registration No. 3933245; issued March 22, 2011; a Section 8 and 15 combined declaration
has been accepted and acknowledged.
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See Opryland USA Inc. v. Great Am. 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). Evidence on summary judgment must be viewed
in a light most favorable to the non-movant, and all justifiable inferences are to be
drawn in the non-movant’s favor. Lloyd’s Food Prods., Inc. v. Eli’s, Inc., 987 F.2d 766,
25 USPQ2d 2027, 2029 (Fed. Cir. 1993); Opryland USA, 23 USPQ2d at 1472. The
Board may not resolve genuine disputes as to material facts; it may only ascertain
whether genuine disputes as to material facts exist. See Lloyd’s Food Prods., 25
USPQ2d at 2029; Olde Tyme Foods, 22 USPQ2d at 1544.
B. The Parties’ Arguments
Respondent argues that it is entitled to summary judgment on the basis of claim
preclusion because: (1) the parties to the Prior Proceeding are identical; (2) a final
judgment was entered in the Prior Proceeding, denying the petition to cancel with
prejudice; and (3) the Prior Proceeding and the Instant Proceeding are based on the
same set of transactional facts. 5 TTABVUE 5-9.
Petitioner argues that claim preclusion does not apply because: (1) Petitioner did
not learn of Respondent’s use in commerce until Respondent filed its motion for
summary judgment in the Prior Proceeding and could not seek leave to add a
likelihood of confusion claim in the Prior Proceeding because the Prior Proceeding
was suspended pursuant to Respondent’s filing of its motion for summary judgment;
(2) Petitioner did not needlessly oppose Respondent’s motion for summary judgment
after Respondent produced substantial evidence of use; and (3) the policy underlying
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claim preclusion does not apply here where Petitioner initiated the Instant
Proceeding before the Prior Proceeding concluded, notified the Board of the Prior
Proceeding when it filed the petition to cancel in the Instant Proceeding, and the Prior
Proceeding “was granted entirely on procedural grounds.” 7 TTABVUE 6-9.
In reply, Respondent argues, inter alia, that: (1) Respondent prevailed on the
merits in the Prior Proceeding; it was not awarded a default judgment; (2) Petitioner
could have asserted its likelihood of confusion claim in the Prior Proceeding, including
during the three week period between Respondent’s filing of its motion for summary
judgment and the issuance of the suspension order on that motion, but it did not;
(3) Petitioner could have filed a motion for leave to amend its petition to cancel to add
a likelihood of confusion claim during the suspension period because amending the
petition to cancel would have been germane to Respondent’s motion for summary
judgment, but it did not; (4) Petitioner’s contention that it was not aware of
Respondent’ use is not credible; and (5) Petitioner could have litigated its likelihood
of confusion claim irrespective of its knowledge of Respondent’s use of the involved
mark. 8 TTABVUE 2-6.
C. Determination
Claim preclusion is also referred to as res judicata. See Urock Network, LLC v.
Sulpasso, 115 USPQ2d 1409, 1410 n.4 (TTAB 2015) (citing Senju Pharm. Co. v.
Apotex Inc., 746 F.3d 1344, 110 USPQ2d 1261, 1263 (Fed. Cir. 2014)). Under the
doctrine of claim preclusion, “a judgment on the merits in a prior suit bars a second
suit involving the same parties or their privies based on the same cause of action.”
Cancellation No. 92071921

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Jet Inc. v. Sewage Aeration Sys., 223 F.3d 1360, 55 USPQ2d 1854, 1856 (Fed. Cir.
2000) (quoting Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326 n.5 (1979)). More
specifically, in the circumstances presented here, “‘[c]laim preclusion refers to the
effect of a judgment in foreclosing litigation of a matter that never has been litigated,
because of a determination that it should have been advanced in an earlier suit. Claim
preclusion therefore encompasses the law of merger and bar.’” Chutter, Inc. v. Great
Concepts, LLC, 119 USPQ2d 1865, 1868 (TTAB 2016) (quoting Migra v. Warren City
School Dist. Bd. of Educ., 465 U.S. 75, 77 n.1 (1984)); see also Nasalok Coating Corp.
v. Nylok Corp., 522 F.2d 1320, 86 USPQ2d 1369, 1371 (Fed. Cir. 2008).
A valid and final judgment rendered in favor of the defendant bars another action
by the plaintiff on the same claim(s) and claims that could have been raised in the
earlier action. See Urock Network, 115 USPQ2d at 1412 (citing Allen v. McCurry, 449
U.S. 90, 94 (1980)). However, “[i]f the claim did not exist at the time of the earlier
action, it could not have been asserted in that action and is not barred by res
judicata.” Aspex Eyewear Inc. v. Marchon Eyewear Inc., 672 F.3d 1335, 101 USPQ2d
2015, 2021 (Fed. Cir. 2012). In view of the foregoing, “a second suit will be barred by
claim preclusion if: (1) there is identity of parties (or their privies); (2) there has been
an earlier final judgment on the merits of a claim; and (3) the second claim is based
on the same set of transactional facts as the first.” Jet Inc., 55 USPQ2d at 1856 (citing
Parklane Hosiery, 439 U.S. at 326 n.5).
Cancellation No. 92071921

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1. First Factor: Identity of Parties
There is no dispute that the parties to the Prior Proceeding and Instant
Proceeding are identical. The first factor of claim preclusion is therefore satisfied.
2. Second Factor: An Earlier Final Judgment On The Merits
of a Claim
The Board granted Respondent’s motion for summary judgment as conceded in
the Prior Proceeding, and in doing so, denied Petitioner’s petition to cancel with
prejudice. “A judgment of a court having jurisdiction of the parties and of the subject
matter operates as res judicata, in the absence of fraud or collusion, even if obtained
upon a default.” Morris v. Jones, 329 U.S. 545, 550-51 (1947) (quoting Riehle v.
Marolies, 279 U.S. 218, 225 (1929)); Int’l Nutrition Co. v. Horphag Research Ltd., 220
F.3d 1325, 55 USPQ2d 1492, 1494 (Fed. Cir. 2000) (“default judgments can give rise
to res judicata”); Flowers Indus. Inc. v. Interstate Brands Corp., 5 USPQ2d 1580, 1583
(TTAB 1987) (claim preclusion applies “even when the prior judgment resulted from
default, consent, or dismissal with prejudice”); Bass Anglers Sportsman Soc’y of Am.,
Inc. v. Bass Pro Lures, Inc., 200 USPQ 819, 822 (TTAB 1978) (“[T]he application of a
legal doctrine which would be appropriate to a judgment after trial is equally
appropriate to a judgment by default.”).
That the Instant Proceeding was initiated before judgment issued in the Prior
Proceeding does not bar the application of claim preclusion, as claim preclusion may
apply between actions that were pending at the same time. See 18 Charles Alan
Wright, et al., Fed. Prac. & Proc. § 4404 (3d ed. Aug. 2019 Update) (“If two actions
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are pursued simultaneously the first judgment to be entered is entitled to res judicata
effect without regard to the order in which the two were commenced[.]”).
Accordingly, there is no genuine dispute of material fact that there has been an
earlier final judgment on the merits of a claim. The second factor of claim preclusion
is therefore satisfied.
3. Third factor: A Second Claim Based on the Same Set of
Transactional Facts as the First
Respondent’s motion for summary judgment implicates the defensive doctrine of
“bar,” wherein the Board must analyze whether a plaintiff can bring a subsequent
action against a defendant. See Jet Inc., 55 USPQ2d at 1856. As noted above, “[t]his
bar extends to relitigation of ‘claims that were raised or could have been raised’ in an
earlier action.” Urock Network, LLC, 115 USPQ2d at 1412(citing Allen v. McCurry,
449 U.S. at 94) (emphasis provided in Urock). “Thus, under claim preclusion, a
plaintiff is barred from a ‘subsequent assertion of the same transactional facts in the
form of a different cause of action or theory of relief.’” Id. (quoting Vitaline Corp. v.
General Mills Inc., 891 F.2d 273, 13 USPQ2d 1172, 1173 (Fed. Cir. 1989)). We must
determine whether Petitioner’s claim of likelihood of confusion in the Instant
Proceeding arises out of the same set of transactional facts as underlying the
abandonment claim in the Prior Proceeding. Id.
“The Court of Appeals for the Federal Circuit has stated that it is guided by the
analysis set forth in the Restatement of Judgments in determining whether a
plaintiff’s claim in a particular case is barred by claim preclusion.” Id. Section 24 of
the Restatement, which addresses splitting claims, provides that:
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(1) When a valid and final judgment rendered in an action extinguishes
the plaintiff’s claim pursuant to the rules of merger or bar … the claim
extinguished includes all rights of the plaintiff to remedies against the
defendant with respect to all or any part of the transaction, or series of
connected transactions, out of which the action arose.
(2) What factual grouping constitutes a “transaction”, and what
grouping constitutes a “series”, are to be determined pragmatically,
giving weight to such considerations as whether the facts are related in
time, space, origin or motivation, whether they form a convenient trial
unit, and whether their treatment as a unit conforms to the parties’
expectations or business understanding or usage.
Restatement (Second) of Judgments § 24 (1982).
To assess whether the claims are based on the same set of transactional facts,
comment b to Section 24 of the Restatement considers whether there is a common
nucleus of operative facts. As noted, relevant factors include whether the facts are so
woven together as to constitute a single claim in their relatedness in time, space,
origin, or motivation, and whether, taken together, they form a convenient unit for
trial purposes. Id. “Courts have defined ‘transaction’ in terms of a ‘core of operative
facts,’ the ‘same operative facts,’ the ‘same nucleus of operative facts,’ and ‘the same,
or nearly the same, factual allegations.’” Urock Network, LLC, 115 USPQ2d at 1413
(quoting Jet Inc., 55 USPQ2d at 1856).
Applying this analysis, we note that the likelihood of confusion claim existed and
Petitioner was undoubtedly aware of the grounds for such a claim when Petitioner
filed the petition in the Prior Proceeding. Petitioner alleged in the Prior Proceeding
that “it is being damaged by Registration No. 4790619” and that damage is inherently
based on Petitioner’s ownership of Petitioner’s Marks — the same basis for
Petitioner’s alleged standing in this proceeding. Although Petitioner argues that it
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did not know of Respondent’s use of the challenged mark when it filed the petition in
the Prior Proceeding, an allegation of Respondent’s use of the challenged mark is not
a required element of a likelihood of confusion claim. Rather, to plead a likelihood of
confusion claim under Section 2(d) of the Trademark Act, Petitioner need only plead
prior use or registration and that Respondent’s mark as applied to its goods is likely
to cause confusion or mistake with Petitioner’s mark. 15 U.S.C. § 1052(d); Nike, Inc.
v. Palm Beach Crossfit, Inc., 116 USPQ2d 1025, 1030 (TTAB 2015) (citing Otto Roth
& Co. v. Universal Foods Corp., 640 F.2d 1317, 209 USPQ2d 40 (CCPA 1981)).
Petitioner’s abandonment and likelihood of confusion claims also would have formed
a convenient trial unit with foreseeable overlap in discovery and trial evidence (e.g.,
with respect to Petitioner’s standing and Respondent’s use of its mark). As such,
Petitioner could have and should have pleaded its likelihood of confusion claim in the
Prior Proceeding.
In view of the foregoing, the third factor of claim preclusion is satisfied.
4. The Policy Behind Claim Preclusion
To the extent Petitioner argues that the policy underlying claim preclusion does
not apply in this proceeding (7 TTABVUE 6-9), Petitioner’s argument is not well-
received. First, Petitioner’s reliance on Sharp Kabushiki Kaisha v. ThinkSharp, Inc.,
448 F.3d 1368, 79 USPQ2d 1376 (Fed. Cir. 2006) is misplaced. In Thinksharp, the
opposer filed two notices of opposition, one against a standard character application
for THINKSHARP and one against an application for THINKSHARP and design.
Thinksharp at 1377. The applicant answered the opposition proceeding against the
standard character THINKSHARP mark but defaulted in the proceeding opposing
Cancellation No. 92071921

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the THINKSHARP and design mark. Id. The opposer argued that, pursuant to claim
preclusion principles, the default judgment in the design mark opposition precluded
the applicant from disputing likelihood of confusion in the standard character
opposition. Id. The Board held, and Federal Circuit affirmed, that the opposer could
not offensively rely on claim preclusion to establish likelihood of confusion in the
standard character opposition. Id. at 1378-80. Thus, the court in Thinksharp
addressed the offensive use of claim preclusion in proceedings where different
marks were being litigated, whereas here, Respondent is defensively relying on
claim preclusion principles between proceedings challenging the identical mark.
Second, “the doctrine of claim preclusion protects defendants from repetitive
lawsuits based on the same conduct, [and] there is a practical need to require
plaintiffs ‘to litigate their claims in an economical and parsimonious fashion.’”
Marrese v. Am. Acad. of Orthopaedic Surgeons, 470 U.S. 373, 385 (1985) (quoting
Marrese v. Am. Acad. of Orthopaedic Surgeons, 726 F.2d 1150, 1153 (7th Cir. 1984)).
Petitioner’s likelihood of confusion claim existed at the time it filed the petition to
cancel in the Prior Proceeding, it should have known of the existence of the claim at
that time, and it should have brought the claim originally. Despite not asserting the
claim initially, Petitioner could have filed a motion for leave to amend in response to
the motion for summary judgment in the Prior Proceeding (i.e., file a motion to amend
the petition to cancel to add a claim of likelihood of confusion and withdraw the
abandonment claim).9 Instead, Petitioner filed the petition to cancel in the Instant

9 If Petitioner had doubts about whether it was appropriate to file a motion to amend its
petition to cancel while the Prior Proceeding was suspended, Petitioner could have contacted
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Proceeding two days before its response to the summary judgment motion was due in
the Prior Proceeding, apparently knowing that it was not going to respond to that
motion. Applying claim preclusion to these facts furthers the purpose of the doctrine
of claim preclusion by protecting Respondent from a repetitive lawsuit based on the
same set of transactional facts and conserves judicial resources.
In short, we find no reason to excuse Petitioner’s failure to take the minimal steps
necessary to preserve its likelihood of confusion claim in the Prior Proceeding, and
we therefore conclude that its likelihood of confusion claim in the Instant Proceeding
is barred by claim preclusion.
III. Summary
Respondent’s motion for summary judgment on claim preclusion is granted.
The petition to cancel is denied with prejudice.

the assigned interlocutory attorney, or it could have filed a motion to amend and argued why
it should be heard despite the suspension. In this regard, a motion to amend a pleading that
withdraws a claim subject to a motion for summary judgment is “germane” to the motion for
summary judgment and would have been considered. See Buffett v. Chi-Chi’s, Inc., 226 USPQ
428, 431 n.8 (TTAB 1985) (“Since the purpose of summary judgment is to dispose of cases in
which there is no claim th[a]t requires trial and since opposer’s motion to amend its notice of
opposition to add two additional claims was, in effect, an additional assertion by opposer that
there are claims that do require trial, the motion to amend was ‘germane’ to applicant’s
motion for summary judgment.”).