Patxi's Limitedv.Johnny K. Wang

Trademark Trial and Appeal Board

Oct 6, 2021

91252969 (T.T.A.B. Oct. 6, 2021)

This Opinion is Not a
Precedent of the TTAB

Hearing: September 21, 2021 Mailed: October 6, 2021

UNITED STATES PATENT AND TRADEMARK OFFICE
_____

Trademark Trial and Appeal Board
_____

Patxi’s Limited

v.

Johnny K. Wang
_____

Opposition No. 91252969
_____

Edmund J. Ferdinand, III and Grace Monroy of Ferdinand IP, LLC for Patxi’s
Limited.

Ethan Preston of Preston Law Offices for Johnny K. Wang.
_____

Before Mermelstein, Greenbaum, and Larkin,
Administrative Trademark Judges.

Opinion by Larkin, Administrative Trademark Judge:
Johnny K. Wang (“Applicant”) seeks registration on the Principal Register of the
standard character mark PATXI’S for “restaurant services” in International Class
43.1 Patxi’s Limited (“Opposer”) opposes registration under Section 2(d) of the
Trademark Act, 15 U.S.C. § 1052(d), on the ground that Applicant’s mark so

1 Application Serial No. 88533955 was filed on July 24, 2019 under Section 1(b) of the
Trademark Act, 15 U.S.C. § 1051(b), based on Applicant’s allegation of a bona fide intention
to use the mark in commerce.
Opposition No. 91252969
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resembles Opposer’s previously-used mark PATXI’S for restaurant services as to be
likely, when used in connection with the restaurant services identified in the opposed
application, to cause confusion, to cause mistake, or to deceive.
The case is fully briefed,2 and counsel for the parties appeared at a video hearing
before the panel on September 21, 2021.3 We sustain the opposition.
I. Record
The record consists of the pleadings,4 the file history of the opposed application,
by operation of Trademark Rule 2.122(b)(1), 37 C.F.R. § 2.122(b)(1), the Testimony

2 Citations in this opinion to the briefs and other docket entries refer to TTABVUE, the
Board’s online docketing system. Turdin v. Tribolite, Ltd., 109 USPQ2d 1473, 1476 n.6 (TTAB
2014). Specifically, the number preceding TTABVUE corresponds to the docket entry
number, and any numbers following TTABVUE refer to the page(s) of the docket entry where
the cited materials appear. Opposer’s main brief appears at 9 TTABVUE and its reply brief
appears at 11 TTABVUE. Applicant’s brief appears at 10 TTABVUE.
3 Applicant appeared pro se in this proceeding from the filing of his answer until the oral
hearing on September 21, 2021, when attorney Ethan Preston appeared on Applicant’s
behalf, 18 TTABVUE, after filing a Notice of Appearance earlier that day. 19 TTABVUE. At
the hearing, Mr. Preston orally moved to amend Applicant’s answer to assert an affirmative
defense of abandonment, and proposed to file a written motion within 10 days. 20 TTABVUE
1-2. The Board issued an order that day allowing Applicant “ten days from the date of this
order in which to submit a written motion to amend his answer to assert the defense of
abandonment,” and stating that “[i]f no motion is submitted within ten days, the case will be
decided on the merits based on the existing pleadings and record.” Id. at 2. The deadline has
passed and no motion was filed.
4 Applicant’s Answer to Opposer’s Notice of Opposition denied the salient allegations of the
Notice, and interposed eight self-styled Affirmative Defenses. 4 TTABVUE 3-4. Applicant’s
first affirmative defense of failure to state a claim upon which relief can be granted is not a
valid defense. U.S. Olympic Comm. v. Tempting Brands Neth. B.V., 2021 USPQ2d 164, at *4
(TTAB 2021). Applicant’s second and eighth affirmative defenses are merely amplifications
of his denials of a likelihood of confusion. Applicant’s third affirmative defense of laches is
generally “not available in an opposition proceeding because the clock for laches begins to
run from the date the application is published for opposition.” Brooklyn Brewery Corp. v.
Brooklyn Brew Shop, LLC, 2020 USPQ2d 10914, at *8 (TTAB 2020). Applicant’s fourth, fifth,
sixth, and seventh affirmative defenses of estoppel, waiver, acquiescence, and unclean hands
were not pursued in his brief and were thus waived. Ayoub, Inc. v. ACS Ayoub Carpet Serv.,
Inc., 118 USPQ2d 1392, 1394 n.4 (TTAB 2016).
Opposition No. 91252969
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Declaration of Opposer’s President and principal shareholder Michael Nakhleh, and
Exhibits A-E thereto (“Nakhleh Test. Decl.”), 6 TTABVUE 2-45; the Testimony
Declaration of John A. Lofton, an attorney for the plaintiffs in an unrelated labor law
suit in California state court in which Opposer is among the defendants, and Exhibit
A thereto (“Lofton Test. Decl.”), 7 TTABVUE 2-20; and Mr. Nakhleh’s “Reply
Testimonial Declaration” (“Nakhleh Rebut. Decl.”). 8 TTABVUE 2-7.5
II. Entitlement to a Statutory Cause of Action6
A plaintiff’s entitlement to a statutory cause of action for opposition or
cancellation must be established in every inter partes case even if, as here, the
defendant does not contest the plaintiff’s entitlement. Chutter, 2021 USPQ2d 1001,
at *10 (citing Corcamore, LLC v. SFM, LLC, 978 F.3d 1298, 2020 USPQ2d 11277, at
*6-7 (Fed. Cir. 2020), cert. denied, ___ U.S. ___ (2021); Australian Therapeutic
Supplies Pty. Ltd. v. Naked TM, LLC, 965 F.3d 1370, 2020 USPQ2d 10837, at *3 (Fed.
Cir. 2020), cert. denied, ___ U.S. ___ (2021); Empresa Cubana Del Tabaco v. Gen.
Cigar Co., 753 F.3d 1270, 111 USPQ2d 1058, 1062 (Fed. Cir. 2014)). Opposer may
oppose Applicant’s application if Opposer’s claim is within the zone of interests
protected by the statute, 15 U.S.C. § 1063, and Opposer has a reasonable belief in

5 We will cite the declarations by paragraph and exhibit number (e.g., “Nakhleh Decl. ¶ 3;
Ex. A”) and, where helpful in following our discussion, by TTABVUE pages as well.
6 “We now refer to what previously had been called standing as ‘entitlement to a statutory
cause of action.’ But our prior decisions and those of the Federal Circuit interpreting
‘standing’ under §§ 13 and 14 remain applicable.” Chutter, Inc. v. Great Mgmt. Grp., LLC,
2021 USPQ2d 1001, at *10 n.39 (TTAB 2021) (citing Spanishtown Enters., Inc. v. Transcend
Res., Inc., 2020 USPQ2d 11388, at *2 (TTAB 2020)).
Opposition No. 91252969
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damage that is proximately caused by registration of Applicant’s mark. Chutter, 2021
USPQ2d 1001, at *10 (citing Spanishtown Enters., 2020 USPQ2d 11388, at *1).
Opposer’s entitlement to oppose Applicant’s application is established by
Applicant’s admission that Opposer owns a pending application to register PATXI’S
for restaurant services that has been refused in part because of Applicant’s
previously-filed application that is involved in this opposition. 1 TTABVUE 4 (Not. of
Opp. ¶ 3); 4 TTABVUE 2 (Answ. to Not. of Opp. ¶ 3). See Chutter, 2021 USPQ2d 1001,
at *11-12; cf. Peterson v. Awshucks SC, LLC, 2020 USPQ2d 11526, at *5 (TTAB 2020).
III. Analysis of Section 2(d) Claim
Section 2(d) of the Trademark Act, 15 U.S.C. § 1052(d), prohibits the registration
of a mark that “[c]onsists of or comprises a mark which so resembles a mark
registered in the Patent or Trademark Office, or a mark or trade name previously
used in the United States by another and not abandoned, as to be likely, when used
on or in connection with the goods of the applicant, to cause confusion, or to cause
mistake, or to deceive.” To prevail on its Section 2(d) claim, Opposer must show by a
preponderance of the evidence that it has priority of use of its alleged PAXTI’S mark
and that Applicant’s use of his PATXI’S mark is likely to cause confusion, mistake,
or deception regarding the source of the restaurant services identified in his
application. New Era Cap Co. v. Pro Era, LLC, 2020 USPQ2d 10596, at *2-3 (TTAB
2020).
In every case under Section 2(d), “two key considerations are the similarities
between the marks and the similarities between the goods [or services].” Double Coin
Opposition No. 91252969
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Holdings, 2019 USPQ2d 377409, at *5 (TTAB 2019) (citing Federated Foods, Inc. v.
Fort Howard Paper Co., 544 F.2d 1098, 192 USPQ 24, 29 (CCPA 1976) (“The
fundamental inquiry mandated by § 2(d) goes to the cumulative effect of differences
in the essential characteristics of the goods [or services] and differences in the
marks.’”)). Applicant effectively concedes likelihood of confusion by not addressing
that issue in his brief, and we find that confusion is likely because the involved
PATXI’S marks and restaurant services are identical. Accordingly, the sole issue on
Opposer’s Section 2(d) claim is whether Opposer established priority of use of the
PATXI’S mark.
“Section 2(d) of the Trademark Act permits an opposer to file an opposition on the
basis of ownership of ‘a mark or trade name previously used in the United States . . .
and not abandoned.’” DeVivo v. Ortiz, 2020 USPQ2d 10153, at *3 (TTAB 2020)
(quoting 15 U.S.C. § 1052(d)). “To establish priority, the mark must be distinctive,
inherently or otherwise, and Opposer must show proprietary rights in a mark as to
which Applicant’s mark gives rise to a likelihood of confusion.” Id.7 “These proprietary
rights may arise from a prior registration, prior trademark or service mark use, prior
use as a trade name, prior use analogous to trademark or service mark use, or any
other use sufficient to establish proprietary rights.” Id. (citing Herbko Int’l Inc. v.
Kappa Books, Inc., 308 F.3d 1156, 64 USPQ2d 1375, 1378 (Fed. Cir. 2002)). “[T]he
decision as to priority is made in accordance with the preponderance of the evidence.”

7 Applicant does not dispute that PATXI’S is distinctive for restaurant services and has
sought to register PATXI’S for those services based on its inherent distinctiveness.
Opposition No. 91252969
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Id. (quoting Hydro-Dynamics, Inc. v. George Putnam & Co., 811 F.2d 1470, 1 USPQ2d
1772, 1773 (Fed. Cir. 1987)). In determining priority, the Federal Circuit has
instructed the Board to “look at the evidence as a whole, as if each piece of evidence
were part of a puzzle which, when fitted together, establishes prior use.” W. Fla.
Seafood, Inc. v. Jet Rests., Inc., 31 F.3d 1122, 31 USPQ2d 1660, 1663 (Fed. Cir. 1994).
“[I]t is Opposer’s burden to demonstrate that [it] owns a trademark or service
mark that was used prior to Applicant’s . . . constructive use of [his] mark” on July
24, 2019, the filing date of his application. DeVivo, 2020 USPQ2d 10153, at *3.8 To
carry that burden, Opposer relies on Mr. Nakhleh’s testimony that “Opposer acquired
all right title and interest in and to the PATXI’S trademark by virtue of an Asset
Purchase Agreement effective September 21, 2018,” Nakhleh Decl. ¶ 3; Ex. A (6
TTABVUE 6-33), and that Opposer has continued to use the mark following the
acquisition. Nakhleh Decl. ¶¶ 5, 10; Nakhleh Rebut. Decl. ¶ 11. “Oral testimony [or
in this case, testimony in a written declaration], if sufficiently probative, is normally
satisfactory to establish priority of use in a trademark proceeding.” Chutter, 2021
USPQ2d 1001, at *26-27 (quoting Powermatics, Inc. v. Globe Roofing Prods. Co., 341
F.2d 127, 144 USPQ 430, 432 (CCPA 1965) and citing Exec. Coach Builders, Inc. v.
SPV Coach Co., 123 USPQ2d 1175, 1184 (TTAB 2017); Nat’l Bank Book Co. v. Leather
Crafted Prods., Inc., 218 USPQ 826, 828 (TTAB 1993)). “[T]he testimony of a single

8 Applicant does not claim any use of his mark, but he “‘may rely without further proof upon
the filing date of [his] application as a ‘constructive use date’ for purposes of priority.’” DeVivo,
2020 USPQ2d 10153, at *3 (quoting Syngenta Crop Prot. Inc. v. Bio-Chek LLC, 90 USPQ2d
1112, 1119 (TTAB 2009)).
Opposition No. 91252969
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witness may be adequate to establish priority.” DeVivo, 2020 USPQ2d 10153, at *3
(citing Exec. Coach Builders, 123 USPQ2d at 1184). As discussed below, Applicant
did not depose or cross-examine Mr. Nakhleh, but instead tried to impeach his
testimony through Mr. Lofton’s testimony as the attorney for the plaintiffs in an
unrelated state court labor law case in which Opposer is among the defendants.
Mr. Nakhleh testified that Opposer is the successor-in-interest to Patxi’s Opco,
LLC and Layers, LLC, who are defined as the “Seller Parties” in the Asset Purchase
Agreement (“APA”) through which Opposer claims to have acquired the PATXI’S
mark. Nakhleh Decl. ¶¶ 2-3; Ex. A (6 TTABVUE 9). He testified that at the time of
the acquisition, Opposer’s predecessors-in-interest had been using the PATXI’S mark
“widely and continuously since 2004 in connection with popular restaurants known
for deep-dish pizza and other items in California, Colorado and Washington.”
Nakhleh Decl. ¶ 2. He further testified that “Patxis was started in 2004 in Palo Alto,
[California],” Nakhleh Decl. ¶ 4; that “the company kept growing” and “[i]n 2014, the
company was firmly in the San Francisco Bay area with 11 locations,” Nakhleh Decl.
¶ 5; that the “company decided to expand into other states opening in Washington
and opening 3 more locations in Colorado,” Nakhleh Decl. ¶ 5; and that “Opposer
purchased the company in 2018 with a vision to grow the company even further.”
Nakhleh Decl. ¶ 5.9

9 Mr. Nakhleh’s testimony that Opposer “purchased the company” that was operating the
PATXI’S restaurants is technically inaccurate because, as discussed below, the APA reflects
an asset purchase rather than a stock purchase.
Opposition No. 91252969
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The APA recited that “the Seller Parties are engaged in the operation of the
Restaurants (as defined below),” 6 TTABVUE 9,10 and that the Seller Parties “desire
to assign, transfer and convey to [Opposer] and [Opposer] desires to accept from the
Seller Parties substantially all of the assets and assume certain specified liabilities
of the Seller Parties related to the operation of the Restaurants on the terms and
subject to the conditions described” in the APA. Id. The APA provided that at the
closing of the contemplated transaction,11 “the Seller Parties shall sell, transfer and
deliver to [Opposer] and [Opposer] shall purchase, acquire and accept, all of the Seller
Parties’ right, title and interest in and to” various identified assets, id. at 15 (APA
§ 2.1), including all “Intellectual Property Assets” (defined as “all Intellectual
Property that is owned by the Seller Parties and used in the operation of the
Restaurants as currently operated,” including all “trademark and service marks (and
all goodwill associated therewith and all registrations and applications therefor”), id.
at 11,12 and the tangible and intangible assets associated with the operation of the
restaurants. Id. at 15-16 (APA § 2.1(a)-(j)).

10 The copy of the APA attached to the Nakhleh Declaration is incomplete because it does not
include various referenced “Exhibits” and “Schedules,” which APA § 9.5 states “are
incorporated into this Agreement and are hereby made a part hereof as if set out in full in
this Agreement.” 6 TTABVUE 31. One of the missing schedules is Schedule 1.1(a), which lists
the restaurants included within the defined term “Restaurants.” Id. at 14.
11 Mr. Nakhleh did not testify about when the transaction closed, but his testimony as a whole
establishes that it closed well before Applicant’s July 24, 2019 filing date.
12 Mr. Nakhleh testified that the “Intellectual Property Assets” included Registration Nos.
4233418 for the PATXI’S logo mark and 4225363 for the PATXI’S word mark, Nakhleh Decl.
¶ 11, and that Opposer inadvertently allowed the registrations to be cancelled in 2019
following the acquisition because “[w]e simply failed to file the required maintenance
documents by the required deadlines.” Nakhleh Rebut. Decl. ¶ 10.
Opposition No. 91252969
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Mr. Nakhleh testified that “[w]hen Opposer took over the brand they [sic]
immediately started expanding” beyond the then-existing 15 PAXTI’S restaurant
locations. Nakhleh Decl. ¶ 5. Opposer subsequently “opened a location in the
prominent LA Live/Staples Center where the Los Angeles Lakers play,” and “3 more
locations were opened in San Diego, and another location in Porter Ranch
[California].”13 Nakhleh Decl. ¶ 5. Opposer “also started growing the brand buy [sic]
starting a franchise system,” which Mr. Nakhleh claimed “was an instant success as
well.” Nakhleh Decl. ¶ 5.
Applicant acknowledges that “Opposer appears to have purchased the Patxi’s
restaurants in 2018,” 10 TTABVUE 2, but argues that Opposer “allowed the mark to
expire while selling off the restaurants to third parties with no license agreement or
reservation of rights as to how the Patxi’s mark could be used.” Id. Applicant further
argues that “Opposer has presented no evidence of actual use of the mark in
commerce by Opposer,” that the “proffered evidence only shows use by the third
parties to whom Opposer sold the restaurants,” and that “[t]his is not the conduct of
a mark owner, and constitutes abandonment of the mark.” Id.
Applicant claims that
The story that Opposer maintains a large franchise
operation appears to be a complete fiction, conceived after
the fact for the purpose of supporting this trademark claim.
Opposer has not produced any evidence of any actual
franchise agreements, license agreements, or agreements

13 We take judicial notice that Porter Ranch is located in the San Fernando Valley outside
Los Angeles, California. See In re Morinaga Nyugyo K.K., 120 USPQ2d 1738, 1744 n.4 (TTAB
2016) (taking judicial notice of locations of Puyallup and Mount Rainier in Washington state).
Opposition No. 91252969
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with “Patxi’s Franchise Corp.” or any of the various third
parties who are currently using the mark.
Id. at 2-3. Applicant concludes that “[c]onsequently, Opposer cannot meet its burden
of proof that it has priority of use and has not abandoned the mark as required by the
Trademark Act.” Id. at 3.14
As discussed below, Applicant also attacks each of the exhibits attached to the
Nakhleh Declaration as not only failing to show use of the PATXI’S mark in
commerce, but also “support[ing] Applicant’s position that the mark is currently in
unrestricted use by third parties over whom Opposer has no control.” Id. at 6.
Applicant’s argument that there are no PATXI’S franchises is based almost
exclusively on a claimed contradiction between Mr. Nakhleh’s testimony in his
Testimony Declaration and statements in discovery responses executed by Mr.
Nakhleh on behalf of Opposer in litigation entitled Charles North, et al. v. Layers,
LLC, et al., Case No. CGC-19-577983 in the Superior Court of the State of California
for the County of San Francisco (the “North Litigation”). Mr. Nakhleh describes the

14 Applicant inaccurately describes the allocation of burdens of proof under Section 2(d) in an
opposition based on a mark “previously used in the United States by another and not
abandoned.” 15 U.S.C. § 1052(d). Although Opposer has the burden of proving that its
PATXI’S mark was “previously used in the United States,” Kemi Organics, LLC v. Gupta,
126 USPQ2d 1601, 1605 (TTAB 2018), Applicant bears the burden of proof on the issue of
whether it was “not abandoned.” Id. (citing W. Fla. Seafood, 31 USPQ2d at 1666). In Kemi
Organics, the Board noted that in the context of cancellation proceedings, Professor
McCarthy has explained that “a petitioner for cancellation does not bear the burden of
negating abandonment when seeking to prove prior use. Rather, abandonment is a defense
to be proven by the registrant.” Id. at n.12 (quoting 3 J. Thomas McCarthy, MCCARTHY ON
TRADEMARKS AND UNFAIR COMPETITION § 20:17 (5th ed. Mar. 2018 update)). This principle
also applies in an opposition under the same statutory language in Section 2(d). Of course,
Applicant must also put Opposer on notice that Applicant intends to pursue an affirmative
defense of abandonment. Applicant’s answer contains no such affirmative defense, and as
noted previously, Applicant did not file a motion for leave to amend his Answer even though
the Board allowed him time in which to do so.
Opposition No. 91252969
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North Litigation as “a class-action lawsuit for employment practices brought on
behalf of former employees of Patxi’s restaurants.” Nakhleh Rebut. Decl. ¶ 2.15
According to the caption of the North Litigation, the defendants include both “Seller
Parties” under the APA, as well as Opposer, Mr. Nakhleh individually, Patxi’s Pizza
SD, Ltd., Patxis PR, Inc., and Patxi’s Franchise Corporation. Lofton Test. Decl. ¶ 2;
Ex. A (7 TTABVUE 5).16
In Opposer’s “Second Supplemental Responses to Special Interrogatories, Set
One” in the North Litigation, Opposer responded to Special Interrogatory No. 6,
which requested Opposer to “[i]dentify (by location and franchisee name) every
franchised California location of the Patxi’s Pizza restaurant chain from May 1, 2018
to the present,” as follows:
Responding Party is informed and believes the following
locations were sold, rather than legally franchised, and
thereby, there are no Paxti’s [sic] Franchises:
- 2260 Otay Lakes Road, Chula Vista, CA 91915
- 3888 4th Avenue, San Diego, CA 92103

15 Mr. Nakhleh testified in his Rebuttal Declaration that Applicant “is himself a former
employee of Patxi’s restaurants” and “may qualify as part of the class action and have a
financial interest in the outcome of the North [Litigation].” Nakhleh Rebut. Decl. ¶ 2. In its
main brief, Opposer similarly describes Applicant as “a former employee of the PATXI’S
restaurant chain.” 9 TTABVUE 2. Applicant does not deny these claims in his brief.
16 The fact that both “Seller Parties” as well as Opposer are defendants in the North Litigation
corroborates Opposer’s acquisition of the Patxi’s restaurants under the APA. Opposer’s
supplemental responses to special interrogatories other than those cited by Applicant also
corroborate that Opposer operated Patxi’s restaurants following the acquisition, as Opposer
stated that it had “provided contact information for non-exempt employees of California
locations of the Patxi’s Pizza restaurant chain from May 1, 2018 to the present,” Supp. Resps.
to Interrogatory Nos. 9-10 (7 TTABVUE 11-13), and that Opposer “did not alter its employees
meal period time recorded.” Supp. Resps. to Interrogatory Nos. 15-17 (7 TTABVUE 13-15).
Opposition No. 91252969
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- 555 Broadway, Ste 140, Chula Vista, CA 91910
- 822 Irving Street, San Francisco, CA 94122
- 3318 Fillmore Street, San Francisco, CA 94123
- 4042 24th Street, San Francisco, CA 94114
- 1875 S. Bascom Avenue, Campbell, CA 95008
- 1011 S. Figueroa Street, B115, Los Angeles, CA 90015
- 340 Bon Air Center, Greenbrae, CA 94904
- 677 Laurel Street, Suite B, San Carlos, CA 94070
- 5130 Dublin Blvd., Dublin, CA 94568
- 3577 Mt. Diablo Blvd., Lafayette, CA 94549
- 3350 Zanker Road, San Jose, CA 95134
- 2470 1st Street, Livermore, CA 94550
- 441 Emerson Street, Palo Alto, CA 94301
7 TTABVUE 8-9.
Opposer also provided a Second Supplemental Response to Special Interrogatory
No. 7, which requested Opposer “[f]or every franchised location of the Patxi’s Pizza
restaurant chain from May 1, 2018 to the present, [to] identify the date the franchise
was created,” as follows:
Responding Party is informed and believes the following
locations were sold, rather than legally franchised, and
thereby, there are no Paxti’s [sic] Franchises. The dates the
restaurants became no longer owned or operated by
Responding Party are as follows:
-2260 Otay Lakes Road, Chula Vista, CA 91915:
approximately August 2019
-3888 4th Avenue, San Diego, CA 92103: approximately
August 2019
Opposition No. 91252969
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-555 Broadway, Ste. 140, Chula Vista, CA 91910:
approximately August 2019
-1011 S. Figueroa Street, B115, Los Angeles, CA 90015:
approximately November 2019
-822 Irving Street, San Francisco, CA 94122: February 11,
2020
-3318 Fillmore Street, San Francisco, CA 94123: February
11, 2020
-4042 24th Street, San Francisco, CA 94114: February 11,
2020
-1875 S. Bascom Avenue, Campbell, CA 95008: February
11, 2020
-340 Bon Air Center, Greenbrae, CA 94904: May 6, 2020
-677 Laurel Street, Suite B, San Carlos, CA 94070: May 6,
2020
-5130 Dublin Blvd., Dublin, CA 94568: May 6, 2020
-3577 Mt. Diablo Blvd., Lafayette, CA 94549: May 6, 2020
Id. at 10-11. Applicant argues that these responses belie Mr. Nakhleh’s testimony
that “[o]ver 20 franchises were sold in less than 12 months,” Nakhleh Decl. ¶ 5,
because the responses “list virtually all of the Patxi’s restaurant locations.” 10
TTABVUE 4.
In its reply brief, Opposer responds that these “arguments are directed to the
nature and extent of Opposer’s trademark rights only with respect to the franchises,”
and that “the franchises are completely separate from the 20 PATXI’S restaurant
locations that Opposer itself owns and operates.” 11 TTABVUE 7. Opposer argues
that even assuming that
Opposition No. 91252969
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the franchise locations never existed, or that the
trademark rights from the franchises do not flow back to
Opposer, Opposer would still have prior and superior
trademark rights against Applicant for the PATXI’s
trademark for restaurant services in the United States by
virtue of the 20 PATXI’s non-franchised, company owned,
restaurant locations that Opposer owns and operates in the
United States.
Id. Opposer cites Mr. Nakhleh’s testimony in his Rebuttal Declaration that “my
testimony in this case is not inconsistent with my prior statements in the North
[Litigation] relating to the issue of franchising of Patxi’s restaurants.” Nakhleh
Rebut. Decl. ¶ 3. He testified that Opposer “owns the stores but not the franchise
rights” and that Opposer “started the franchise system but the operations are
conducted through a different corporate entity, Patxi’s Franchise Corp.” Nakhleh
Rebut. Decl. ¶ 5.17 He further testified that “all use of the PATXI’S trademarks by
Patxi’s Franchise Corp. inures to the benefit of Opposer, Patxi’s Limited by virtue of
an agreement.” Nakhleh Rebut. Decl. ¶ 7. Opposer did not provide a copy of the
referenced agreement.
As noted above, Mr. Nakhleh testified that at the time of the acquisition of the
PATXI’S restaurants, there were 11 locations of the restaurants in the San Francisco
Bay Area, one in Washington state, and three in Colorado, and that after the
acquisition, Opposer opened an additional location in Los Angeles, three additional

17 Mr. Lofton testified that the “California Department of Corporations maintains a database
of all franchise operations in California, and requires all such franchise operations to register
with the Department,” that he searched the publicly available database at
www.dfpi.ca.gov/privacy.asp “for any franchises associated with Patxi’s Limited,” and that
the “search returned no results.” Lofton Test. Decl. ¶ 5; Ex. B (7 TTABVUE 19). He does not
appear to have searched for any franchises associated with Patxi’s Franchise Corporation,
one of Opposer’s co-defendants in the North Litigation.
Opposition No. 91252969
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locations in San Diego, and an additional location in Porter Ranch. We find that Mr.
Nakhleh’s testimony regarding “starting a franchise system” following the
acquisition, Nakhleh Test. Decl. ¶ 5, indicates that the 15 locations in existence at
the time of the acquisition, and the five additional ones subsequently opened by
Opposer in southern California, were what Opposer describes in its reply brief as “the
20 PATXI’S restaurant locations that Opposer itself owns and operates.” 11
TTABVUE 7. Mr. Nakhleh’s uncontradicted testimony thus establishes that prior to
starting a franchise system, there were at least 15 and possibly as many as 20
company-owned restaurants in operation under the PATXI’S mark in three states,
and he testified that to his “knowledge the restaurants have never closed, not even
during this past year during COVID.” Nakhleh Rebut. Decl. ¶ 11.
Applicant makes no attempt to show that the four company-owned restaurants
outside California have ever ceased use of the PATXI’S mark and, on this record, we
find that they were operating under the mark at the time of trial. Fifteen of the 16
company-owned locations in California are identified in Opposer’s Second
Supplemental Response to Special Interrogatory No. 6 as locations that “were sold,
rather than legally franchised,” such that “there are no Patxi’s Franchises.” These
locations are in Chula Vista (two), San Diego, San Francisco (three), Campbell, Los
Angeles, Greenbrae, San Carlos, Dublin, Lafayette, San Jose, Livermore, and Palo
Alto. The Porter Ranch location is not listed. Lofton Test. Decl. ¶ 2; Ex. A (7
TTABVUE 9-10).
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In its Second Supplemental Response to Special Interrogatory No. 7, Opposer
listed 12 locations that “were sold, rather than legally franchised” and also provided
“[t]he dates the restaurants became no longer owner or operated by” Opposer. These
12 locations included the two Chula Vista locations (whose status changed
“approximately August 2019”), the San Diego location (whose status changed
“approximately August 2019”), the Los Angeles location (whose status changed
“approximately November 2019”), the three San Francisco locations (whose status
changed on February 11, 2020), and the Campbell, Greenbrae, San Carlos, Dublin,
and Lafayette locations (whose status changed on May 6, 2020). The San Jose,
Livermore, and Palo Alto locations listed in Opposer’s response to Special
Interrogatory No. 6 are not included. Lofton Test. Decl. ¶ 2; Ex. A (7 TTABVUE 10-
11).
It is not clear on the face of Opposer’s Second Supplemental Response to Special
Interrogatory No. 7 exactly what Opposer meant by its statement that the 12
locations “became no longer owned or operated by” Opposer, and Mr. Nakhleh’s
Rebuttal Testimony Declaration does not enlighten us on that issue. Two possible
explanations are that the 12 locations were sold to other entities and no longer
operate under the PATXI’S mark, or that they were sold to other entities that
continue to operate under the PATXI’S mark as franchisees of Patxi’s Franchise
Corporation. Explaining this enigma is unnecessary, however, because regardless of
the current status of these 12 locations, Applicant makes no effort to show that the
San Jose, Livermore, Palo Alto, and Porter Ranch locations have ever ceased use of
Opposition No. 91252969
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the PATXI’S mark and, on this record, we find that they were operating under the
mark at the time of trial. The record thus shows that at least eight restaurant
locations owned by Opposer were operating in three states under the PATXI’S mark
at the time of trial.
Viewing the “evidence as a whole, as if each piece of evidence were part of a puzzle
which, when fitted together, establishes prior use,” W. Fla. Seafood, 31 USPQ2d at
1663, we find that Opposer established priority of use of the PATXI’S mark by a
preponderance of the evidence. While neither Mr. Nakhleh’s Testimony Declaration,
and the exhibits thereto, nor his Rebuttal Testimony Declaration, “is a model of
clarity or completeness,” Kemi Organics, 126 USPQ2d at 1608, we find that his
uncontradicted testimony as a whole is sufficient to establish that use of the PATXI’S
mark for restaurant services by Opposer’s predecessor-in-interest began in 2004; that
Opposer acquired rights to the PATXI’S mark in 2018 under the APA through its
acquisition of multiple restaurants operating under the mark; that following the
acquisition Opposer made additional use of the PATXI’S mark for restaurants in new
locations; and that at least eight restaurants were operating under the PATXI’S mark
in three states at the time of trial. Opposer thus carried its burden of showing by a
preponderance of the evidence that “its mark was ‘previously used in the United
States before [Applicant’s] constructive use priority date.” Id. at 1605 (citing Exec.
Coach Builders, 123 USPQ2d at 1180).
As discussed above, it was Applicant’s burden to plead an affirmative defense of
abandonment, and then to establish at least a prima facie case that Opposer’s mark
Opposition No. 91252969
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was abandoned, id., but he failed to do either. His evidence in the form of Opposer’s
discovery responses in the North Litigation does not establish that Opposer ceased
all use of the PATXI’S mark with the intent not to resume use, see id. at 1608, or that
even if we had accepted Applicant’s eleventh-hour theory of abandonment by naked
licensing, 10 TTABVUE 5, that PATXI’S lost all significance as a mark for restaurant
services through Opposer’s post-acquisition franchising.
Applicant’s attacks on Opposer’s documentary evidence of priority fare no better.
Documentary evidence is not required to prove priority where oral testimony is
sufficient to do so, as we find that it is here, Kemi Organics, 126 USPQ2d at 1608,
although it may corroborate such testimony. Opposer’s documentary evidence
consists of what Mr. Nakhleh describes as webpages from yelp.com, which he claimed
“show[ ] customer reviews dating back to 2005,” Nakhleh Test. Decl. ¶ 6; Ex. B (6
TTABVUE 34);18 a “SuperBowl menu featuring the Patxi’s brand from January
2019,” Nakhleh Test. Decl. ¶ 7; Ex. C (6 TTABVUE 35); a “marketing plan for the
Patxi’s brand for 2020,” Nakhleh Test. Decl. ¶ 8; Ex. D (6 TTABVUE 36-43);19 and
“in-store ads featuring the Patxi’s brand.” Nakhleh Test. Decl. ¶ 9; Ex. E (6
TTABVUE 44).
Applicant responds that Exhibit B “is a menu for the Patxi’s location at 441
Emerson Street in Palo Alto, CA,” 10 TTABVUE 6, that Exhibit C “is a menu for the
Patxi’s location at 1011 S. Figueroa St. in Los Angeles, CA,” id., and that Opposer’s

18 The exhibits do not bear the exhibit lettering discussed in the body of Mr. Nakhleh’s
Declaration, making it difficult to identify the specific referenced documents.
19 The document is actually captioned “Q1 Marketing Plan 2020.”
Opposition No. 91252969
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discovery responses “confirm[ ] that these locations were sold, not franchised, to third
parties, and are not owned or operated by Opposer.” Id. Applicant argues that Exhibit
D “appears to be an internal marketing presentation . . . and does not constitute use
in commerce,” id., and that “[t]here is no testimony or other evidence that the ad” in
Exhibit E “was in fact used by Opposer, as opposed to one of the various third parties
who bought stores from Opposer – in which case it would be no evidence at all.” Id.
at 6-7. These arguments are unavailing.
Exhibit B is a page from the Yelp website, although it does not contain any
reviews, much less “reviews dating back to 2005,” as Opposer claims. Nakhleh Test.
Decl. ¶ 6; Ex. B (6 TTABVUE 38). We agree with Applicant that it pertains to the
Patxi’s location at 441 Emerson Street in Palo Alto, and its listing of “COVID-19
Updates” indicates it was downloaded sometime in 2020, when the Covid-19
pandemic resulted in the imposition of restrictions on the operations of restaurants
in California and elsewhere in the United States. We have found above, however, that
the Palo Alto location is one of Opposer’s company-owned stores and that it was in
operation at the time of trial. Exhibit B has probative value to the extent that it
corroborates Mr. Nakhleh’s testimony regarding Opposer’s post-acquisition use of the
PATXI’S mark.
The same is true for Exhibit C. We agree with Applicant that this is “a menu for
the Patxi’s location at 1011 S. Figueroa St. in Los Angeles, CA,” which Mr. Nakhleh
testified is located at LA Live at the Staples Center. Nakhleh Test. Decl. ¶ 5. He
testified that this menu was from February 2019, Nakhleh Test. Decl. ¶ 7; Ex. C (6
Opposition No. 91252969
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TTABVUE 39), and, as discussed above, according to Opposer’s discovery responses
on which Applicant relies, this location did not cease being owned or operated by
Opposer until “approximately November 2019.” 7 TTABVUE 11. This location was
thus in operation as a company-owned store when the menu was used. As with
Exhibit B, Exhibit C has probative value to the extent that it corroborates Mr.
Nakhleh’s testimony regarding Opposer’s post-acquisition use of the PATXI’S mark.
We agree with Applicant that Exhibit D, which Mr. Nakhleh described as a
“marketing plan for the Patxi’s brand for 2020,” Nakhleh Test. Decl. ¶ 8; Ex. D (6
TTABVUE 39-43), does not itself show use in commerce, but it does corroborate Mr.
Nakhleh’s testimony that Opposer owned and operated restaurants using the
PATXI’S mark.
Finally, Mr. Nakhleh testified that Exhibit E consists of “in-store ads featuring
the Patxi’s brand.” Nakhleh Test. Decl. ¶ 9; Ex. E (6 TTABVUE 44). Exhibit E is a
single undated page showing a slice of pizza being removed from a pie and it does not
identify any particular restaurant locations. Nevertheless, Exhibit E “shows the
mark [PATXI’S] used in connection with restaurant services.” W. Fla. Seafood, 31
USPQ2d at 1664, and “the pertinent inquiry in this case is simply whether a potential
customer would have believed that someone was proclaiming to be engaged in
restaurant services under the name [PATXI’S] at the time of the advertisement[ ].”
Id. “That is undoubtedly what a potential customer would have believed in this case,”
id., particularly because Mr. Nakhleh testified that the ads were used “in-store,” and
Opposition No. 91252969
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Exhibit E thus corroborates his testimony that Opposer owned and operated
restaurants using the PATXI’S mark.
Applicant did not cross-examine Mr. Nakhleh, and “in the absence of any contrary
testimony from a discovery deposition of Mr. [Nakhleh], any contrary fruits of
discovery, any [probative] testimony from [Applicant’s] own witnesses, or any
documentary evidence establishing non-use of the [PATXI’S] mark or impeaching
[Mr. Nakhleh’s] testimony, [Opposer’s] evidence of prior use stands unrebutted.”
Kemi Organics, 126 USPQ2d at 1609. We find that Opposer proved by a
preponderance of the evidence that it was using the PATXI’S mark prior to
Applicant’s July 24, 2019 constructive use priority date, and that Applicant did not
plead, much less prove, that the PATXI’S mark was abandoned. Because there is
clearly a likelihood of confusion between the identical PATXI’S marks when used in
connection with restaurant services, we find that Opposer proved its Section 2(d) case
by a preponderance of the evidence.
Decision: The opposition is sustained.