Paradyme Alloys, LLCv.General Motors Corp.

Trademark Trial and Appeal Board

Apr 13, 2004

No. 91158477 (T.T.A.B. Apr. 13, 2004)

Mail date: April 13, 2004
Opposition No. 91158477
Paradyme Alloys, LLC
v.
General Motors Corporation
Before Hanak, Hohein and Walters, Administrative Trademark
Judges.
By the Board:
Applicant is seeking to register the mark PARADIGM for
“motor, land vehicle propulsion systems, namely drive trains, and
structural parts thereof.”1 As grounds for the opposition,
opposer alleges that applicant’s mark, when used on the
identified goods, so resembles opposer’s previously used and
registered mark PARADYME for “motor vehicle wheels and structural
parts therefor, namely, rims, hubs, covers, wheel bearings and
metal fasteners therefore”2 as to be likely to cause confusion,
mistake or to deceive. Opposer further alleges that, during the
prosecution of applicant’s application, applicant informed the
Office that “the current owner[s]” of referenced application
Serial No. 76141048 (which matured into opposer’s pleaded
1 Application Serial No. 78040044, filed on December 20, 2000, claiming
a bona fide intent to use the mark in commerce.
2 Registration No. 2733788 issued on July 8, 2003 from an application
filed on October 4, 2000. Use anywhere and use in commerce are
claimed since August 4, 2000.
UNITED STATES DEPARTMENT OF COMMERCE
Patent and Trademark Office
Trademark Trial and Appeal Board
2900 Crystal Drive
Arlington, Virginia 22202-3513
THIS OPINION IS
NOT CITABLE
AS PRECEDENT OF
THE TTAB
Opposition No. 91158477
2
Registration No. 2733788) consented to the registration of
applicant’s mark as provided in a submitted redacted Settlement
Agreement and Assignments (dated June 13, 2003).3 Opposer
alleges that such agreements are between Automotive Design &
Composites, Ltd. (“ADC”) and Michael Van Steenburg, on the one
hand, and applicant, on the other hand; and included assignments
by which ADC and Steenburg purportedly assigned “…all right,
title and interest in and to the mark PARADIGM relating to the
use and registration of the mark by ADC and Steenburg and any
predecessors of either of them, together with the goodwill of the
business symbolized by that mark and any registrations or
applications for the mark.”4 Opposer alleges that ADC and
3 The settlement pertains to litigation between Automotive Design &
Composites, Ltd. (“ADC”) and Michael Van Steenburg as plaintiffs and
General Motor Corporation (“GM”) as defendant. Automotive Design &
Composites, Ltd. v. General Motors Corporation, Civil No. SA-01-CA-
0478-EP in the United States District Court for the Western District
of Texas, San Antonio Division. A copy of the redacted Settlement
Agreement submitted during the prosecution of applicant’s application
accompanies opposer’s complaint as Exhibit No. 1, with Exhibit A
thereto being a copy of the assignment of Serial No. 76141048 (now
Registration No. 2733788) from Paradyme Alloys, LLC to Automotive
Design & Compositions, Ltd., and Exhibit B thereto being a copy of the
assignment from Automotive Design & Compositions, Ltd. to General
Motors of ADC’s application Serial No. 76287906 for the mark PARADIGM.
Exhibit No. 2 to opposer’s complaint is a copy of a promissory note
from ADC to opposer and a copy of the settlement agreement for
Opposition No. 124284 between ADC and Paradyme Alloys.
4 In view of the Settlement Agreement between ADC and Steenburg, and
GM, ADC alleged it had adopted PARADIGM for an “all-plastic vehicle,”
and assigned any such rights in PARADIGM to GM. The agreement further
provides that ADC retains any ownership it may have in the mark
PARADYME for “motor vehicle wheels and structural parts thereof,
namely rims, hubs, covers, wheel bearings and metal fasteners
therefore,” while further recognizing that no likelihood of confusion
will arise from GM’s use of PARADIGM for “power trains or drive trains
for automobiles” and ADC’ use of PARADYME for its identified goods.
ADC and Steenburg further consented to GM’s use and registration of
PARADIGM for “automotive power trains or drive trains.”
Opposition No. 91158477
3
Steenburg were not the owners of the mark at the time the
Settlement Agreement and the Assignments were executed because
previously, on June 3, 2002, opposer executed a conditional
assignment to ADC, and ownership of the PARADYME mark reverted
back to opposer for failure of the conditions being met.
In lieu of an answer, applicant filed, on December 22, 2003,
a motion to dismiss the opposition for failure to state a claim
upon which relief may be granted. In its motion, applicant
references the agreement attached to the notice of opposition.
Opposer filed a response in which it submitted additional
materials. Applicant replied thereto, acknowledging that the
Board may need to review the relevant contracts, which, according
to applicant, demonstrate that there are no disputed issues of
fact, and the opposition should be dismissed with prejudice.
If, on a motion to dismiss pursuant to Fed. R. Civ. P.
12(b)(6), matters outside the pleadings are submitted and not
excluded by the Board, the motion will be treated as a motion for
summary judgment under Fed. R. Civ. P. 56. Inasmuch as matters
outside the pleadings have been submitted by opposer for
consideration, and applicant has indicated that the Board may
need to review the submissions, applicant’s motion will be
treated as one for summary judgment.
In support of its motion, applicant argues that opposer does
not have any right, title and interest in the mark PARADYME, or
to the federal registration for the mark PARADYME, because it
sold its rights therein to ADC, and simply received back a
Opposition No. 91158477
4
license to use the mark. Thus, applicant contends, opposer does
not have standing to bring this opposition. According to
applicant, subsequent to publication of opposer’s then pending
application Serial No. 76141087 (now Registration No. 2733788),
ADC filed an opposition to the registration of opposer’s mark;
and the parties settled with opposer assigning the PARADYME mark,
application, and attendant goodwill to ADC.5 Applicant
summarizes the terms of the agreement between opposer and ADC,
executed on June 4, 2002, as including a payment to opposer of
$30,000 upon execution of the Settlement Agreement; a payment of
$33,000 due within 30 days of the execution of the Settlement
Agreement; and the execution of a promissory note for $162,000
from ADC to opposer which states that it is “…to be paid in full
on the earlier of (1) May 31, 2004, or (2) the recovery of
damages from General Motors Corporation….” It is applicant’s
position that the mark reverts back to opposer only if ADC does
not pay the note under the terms set out; and nothing is yet due
under the note because ADC has not recovered any damages from
General Motors Corporation, and the promissory note due date of
May 31, 2004 has not yet arrived.
Applicant explains that it was involved in litigation with
ADC over applicant’s use of its own PARADIGM mark; that it
entered into a Settlement Agreement with ADC, executed June 19,
5 The Board notes that Office assignment records show that the
assignment from Paradyme Alloys to ADC was recorded on June 6 and June
4, 2002 for the entire interest and goodwill at Reels 2534, 2537 and
Frames 0214, 0457.
Opposition No. 91158477
5
2003, by which ADC assigned all rights, title and interest to
applicant in and to the PARADIGM mark for motor vehicles; that
ADC agreed that use by applicant of its PARADIGM mark is not
likely to cause confusion with ADC’s use of its PARADYME mark;
and that ADC consented to applicant’s use and registration of
applicant’s PARADIGM mark. Applicant further explains that ADC
did not receive damages from applicant that would trigger
provision (2) of the promissory note. Applicant contends that
ADC is the rightful owner of the mark and registration pleaded by
opposer, and was the rightful owner at the time ADC and applicant
entered into their Settlement Agreement. Applicant argues that,
even if the mark and registration revert back to opposer on May
31, 2004, opposer is bound by any of ADC’s agreements entered
into between June 4, 2002 and May 31, 2004 because ADC was the
legal owner during this time period.
In response, opposer asserts it is the registrant of U.S.
Registration No. 2733788 for the mark PARADYME. According to
opposer, its June 4, 2002 agreement with ADC required (1) a
payment from ADC of $30,000 upon execution; (2) a payment from
ADC of $33,000 within 30 days of execution; (3) a promissory note
from ADC in the amount of $162,000 payable to opposer the earlier
of (a) May 31, 2004 or (b) the recovery of damages in the lawsuit
between ADC and GM; and (4) an exclusive license from ADC to
opposer for the mark PARADYME for “motor vehicle and structural
parts therefore, namely, rims, hubs, covers, wheel bearings and
metal fasteners therefore.” Opposer argues that, under the
Opposition No. 91158477
6
Settlement Agreement, ADC’s ownership of the mark was conditioned
upon the happening of certain events; and that ADC forfeited its
ownership of the PARADYME mark when it did not make the $33,000
payment, due within 30 days of execution of the agreement,
because opposer retained a reversionary interest in the mark.
Opposer argues that it notified ADC of the default on several
occasions. Opposer contends that, at the time of settlement
between ADC and GM, ADC was not the owner of the mark and, thus,
the assignment from ADC to GM is invalid. Opposer additionally
contends that it is not bound by any agreement made by ADC after
ADC breached the agreement.
Opposer’s response is accompanied by copies of the following
documents:
1) the affidavit of Michael J. Anderson, managing
member of opposer, stating that he notified ADC
and its attorneys on several occasions that ADC
was in default of the Settlement Agreement between
opposer and ADC for ADC’s failure to make the
second payment; and further indicating that
opposer was not notified of the June 13, 2003
settlement between ADC and GM in which ADC
asserted it was the owner of the PARADYME mark;
2) a copy of the June 4, 2002 Settlement Agreement
between Automotive Design & Composites, Ltd. and
Paradyme Alloys, LLC;
3) a copy of the June 4, 2002 assignment of the
PARADYME mark and application (Serial No.
76141048) from Paradyme Alloys, LLC to Automotive
Design & Composites, Ltd.;
4) a copy of the Promissory Note (dated May 31, 2002)
from Automotive Design & Composites, Ltd. as maker
to Paradyme Alloys, LLC as payee;
5) a copy of the June 4, 2002 License Agreement from
Automotive Design & Composites, Ltd. to Paradyme
Alloys, LLC, licensing use of the PARADYME mark
for “motor vehicle wheels and structural parts
thereof, namely, rims, hubs, covers, wheel
bearings and metal fasteners thereof;” and
Opposition No. 91158477
7
6) a copy of the June 13, 2003 Settlement Agreement
(redacted) between Automotive Design & Composites,
Ltd. and Michael Van Steenburg, on the one hand,
and General Motors Corporation, on the other hand.
In reply, applicant clarifies that it did not receive an
assignment of the PARADYME mark from ADC. Applicant explains
that three marks are discussed in this controversy: PARADYME
(now Registration No. 2733788), originally owned and used by
Paradyme Alloys, LLC and assigned to ADC on June 4, 2002;
PARADIGM (Serial No. 76287906), originally owned and used by ADC
and assigned to GM on June 13, 2003; and PARADIGM (Serial No.
78040044), the subject of this opposition, and owned by GM.
Applicant contends that ADC’s rights to PARADYME were not
conditioned on the second ($33,000) payment, but that ADC
received an assignment of the entire right, title and interest in
and to the PARADYME mark and application, together with the
goodwill of the business symbolized by the mark. Applicant
contends that, under the terms of the Settlement Agreement
between opposer and ADC, the PARADYME mark reverts back to
opposer only if ADC does not pay the Promissory Note, which is
not yet due. Thus, it is applicant’s position that ADC is the
present owner of the PARADYME mark.
In this case, we must first look at the documents involved
in the June 4, 2002 transaction between opposer and ADC
concerning the PARADYME mark and application. Those documents
are: the Settlement Agreement and accompanying Assignment of the
PARADYME mark and application, and accompanying License
Agreement; and the Promissory Note, dated May 31, 2002.
Opposition No. 91158477
8
The June 4, 2002 Settlement Agreement is short, being only
two pages, and provides for an assignment from Paradyme Alloys to
ADC of application Serial No. 76141087 for the mark PARADYME and
the goodwill associated therewith; an exclusive license from ADC
to Paradyme Alloys to use the PARADYME mark for the identified
goods;6 consideration for the assignment, with a payment schedule
set forth; an agreement to dismiss then pending Opposition No.
124284 between ADC and Paradyme Alloys; and a statement that the
parties have settled their differences by entering into the
agreement.
Applicant and opposer dispute the meaning of a portion of
Paragraph No. 3 of the June 4, 2002 Settlement Agreement. The
language is set forth below, with emphasis added to the portion
in dispute:
3) As consideration for the assignment, Automotive
Design shall (a) pay $30,000 to Paradyme Alloys
upon execution of this Settlement Agreement, (b)
pay an additional $33,000 within 30 days from the
execution of this Settlement Agreement, and (c)
execute a note in the amount of $162,000 payable
to Paradyme Alloys in the form indicated in
Exhibit C attached hereto. All payments are non-
refundable. If Automotive Design does not pay the
note under the terms of called for therein, all
rights to the mark PARADYME shall revert to
Paradyme Alloys.
6 The assignment of the PARADYME mark and application from Paradyme
Alloys to ADC assigns “… the entire right, title and interest in, to
and under the said trademarks(s)…” and includes “… the goodwill of the
business symbolized by the trademark(s)….” As noted at Footnote No.
5, supra, said assignment was recorded with the Office. The License
Agreement between ADC and Paradyme Alloys recognizes ADC as the owner
of the PARADYME mark and application (as well as a PARADIGM mark and
application) and grants Paradyme Alloys “… a fully paid-up, exclusive
non-transferable license … to use the mark PARADYME…” for the
identified goods.
Opposition No. 91158477
9
The Promissory Note indicates that the principal amount
($162,000) is “… to be paid in full on the earlier of (1) May 31,
2003, or (2) the recovery of damages from General Motors
Corporation in a suit styled Automotive Design & Composites, Ltd.
v. General Motors Corporation, U.S. District Court, Western
District of Texas, Civil Action No. SA01CA0478EP.” The Note
further provides, in part, as follows:
If Maker defaults in the payment of this note or in the
performance of any obligation in any instrument securing or
collateral to it, and the default continues after the Payee
gives Maker notice of the default and the time within which
it must be cured, as may be required by law or by written
agreement, then Payee may declare the unpaid principal
balance on this note immediately due. Maker and each
surety, endorser and guarantor waive all demands for
payment, presentations for payment, notices of intention to
accelerate maturity, notices of acceleration of maturity,
protest, and notices of protest, to the extent permitted by
law. (Emphasis added.)
It is applicant’s position that the emphasized portions of
the Settlement Agreement and the Promissory Note prove that ADC
is the present owner of the PARADYME mark, and was the owner at
the time of settlement of the civil action between ADC and GM.
More particularly, according to applicant, there has been no
reversion of the PARADYME mark back to Paradyme Alloys because
the note is not yet due under its terms.
Opposer argues that the emphasized portion of the promissory
note demonstrates that reversion of the PARADYME mark has
occurred, and had occurred prior to the settlement between ADC
and GM, because the second payment of $33,000 was an obligation
on the payment of the note on which ADC defaulted.
Opposition No. 91158477
10
In a motion for summary judgment, the moving party has the
burden of establishing the absence of any genuine issue of
material fact and that it is entitled to judgment as a matter of
law. See Fed. R. Civ. P. 56. A genuine dispute with respect to
a material fact exists if sufficient evidence is presented that a
reasonable fact finder could decide the question in favor of the
non-moving party. See Opryland USA Inc. v. Great American Music
Show, Inc., 970 F.2d 847, 23 USPQ2d 1471 (Fed. Cir. 1992). Thus,
all doubts as to whether any particular factual issues are
genuinely in dispute must be resolved in the light most favorable
to the non-moving party. See Olde Tyme Foods Inc. v. Roundy’s
Inc., 961 F.2d 200, 22 USPQ 1542 (Fed. Cir. 1992).
After careful consideration of the Settlement Agreement and
Promissory Note between Paradyme Alloys (opposer herein) and ADC,
we find that applicant has met its burden on summary judgment of
establishing that no genuine issues of material fact exist, and
that opposer is not the owner of the pleaded PARADYME mark and
registration. Despite opposer’s arguments to the contrary, the
record is devoid of any evidence which raises a genuine issue of
material fact as to whether the terms of the Settlement Agreement
and Promissory Note are ambiguous, and whether there yet has been
a breach by ADC which resulted in reversion to opposer of the
PARADYME mark.
In interpreting contracts, “unless a different intention is
manifested, … where language has a generally prevailing meaning,
it is interpreted in accordance with that meaning.” See
Opposition No. 91158477
11
Restatement (Second) of Contracts § 202(3)(a) (1981). Thus, the
interpretation of an agreement must be based, not on the
subjective intention of the parties, but on the objective words
of their agreement. See Novamedix Ltd. v. NDM Acquisition Corp.,
166 F.3d 1177, 1180, 49 USPQ2d 1613, 1616 (Fed. Cir. 1999).7
Paragraph No. 3 of the Settlement Agreement between ADC and
Paradyme Alloys calls for two monetary payments and the execution
of a Promissory Note. The condition for reversion of the
PARADYME mark to Paradyme Alloys is triggered if ADC does not pay
the note under the terms called for therein (emphasis added).
“Therein” refers to the terms set out in the note. Thus, we must
look at the terms of the note to ascertain what is called for and
when a breach has occurred resulting in reversion of the PARADYME
mark to Paradyme Alloys.
May 31, 2004, has not yet arrived and ADC did not recover
damages from GM when their suit was settled. Thus, the potential
due dates for the $162,000 note as described at provisions (1)
and (2) of the Promissory Note have not occurred. The second
payment of $33,000 is not identified as a payment in the
Promissory Note, or an obligation securing the note, or
collateral to the note, such that ADC, as Maker of the note,
defaulted “in the payment of this note or in the performance of
7 The Settlement Agreement between ADC and Paradyme Alloys does not
have a forum clause. However, both Michigan and Texas, the states
where the parties executed their agreement, interpret contracts under
the plain meaning rule. See Oliver v. Rogers, 976 S.W.2d 792, 803
(Tex.Ct.App.1998); and Michigan Nat'l Bank v. Laskowski, 580 N.W.2d 8,
10 (Mich.Ct.App.1998).
Opposition No. 91158477
12
any obligation in any instrument securing or collateral to it….”
(Emphasis added.)
Thus, the reversion clause of Paragraph No. 3 of the June 4,
2002 Settlement Agreement between ADC and Paradyme Alloys has not
been triggered, and ADC is the present owner of the PARADYME mark
as provided for in the June 4, 2002 Settlement Agreement and
accompanying assignment.
In order to prevail in an opposition, a plaintiff must
plead, and ultimately prove, not only its standing, but also a
ground for opposition or cancellation. If one of the necessary
elements of the plaintiff's pleaded grounds for opposition is
plaintiff's ownership of a proprietary right in a mark which is
the same as, or similar to, the defendant's mark, then the
plaintiff must plead, and ultimately prove, its proprietary
right, in order to establish its grounds for opposition. See
Kelly Services Inc. v. Greene's Temporaries Inc., 25 USPQ2d 1460
(TTAB 1992).
Inasmuch as there are no genuine issues of material fact,
and opposer is not the owner of the pleaded mark and
registration, opposer cannot claim the proprietary interest
requisite for its pleaded grounds of priority, likelihood of
confusion, mistake or deceit and, thus, has not pleaded
sufficient facts which, if proven, would allow opposer to obtain
the relief it seeks.
Accordingly, applicant’s motion for summary judgment is
granted, and the opposition is dismissed with prejudice.