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CAFC Finds TTAB Constitutional

Posted by Thomas P. Howard | Sep 05, 2021 | 0 Comments

By James Juo.

The Federal Circuit held that the Trademark Trial and Appeal Board (“TTAB”) is constitutional because the Director of the U.S. Patent and Trademark Office (“USPTO”), a Presidential appointee, had the authority to review decisions of the TTAB under the trademark statutes in Piano Factory Group Inc v. Schiedmayer Celesta GmbH, No. 20-1196 (Fed. Cir. Sept. 1, 2021).

In this appeal of the TTAB's decision to cancel a trademark registration, the registrant's argued, among other things, that the TTAB judges (or administrative trademark judges or ATJs) had been unconstitutionally appointed, echoing arguments from Arthrex Inc v. Smith & Nephew, 141 S. Ct. 1970 (2021), where the U.S. Supreme Court had found that Patent Trial and Appeal Board (“PTAB”) judges had been appointed in a way that violates the Appointments Clause of the U.S. Constitution.

In Arthrex, the Supreme Court held that the statutory scheme that created the PTAB also made PTAB judges “principal officers” of the United States who needed to be appointed by the President and confirmed by the Senate, because the Director lacked supervisory control over individual PTAB cases and no other Executive Branch official could directly supervise the work of PTAB judges. The Supreme Court struck down 35 U.S.C. § 6(c) (where only the PTAB may grant rehearings of PTAB decisions) and 35 U.S.C. § 318(b) (requiring the Director to comply with PTAB decisions) as unconstitutional, making the PTAB judges “inferior officers” accountable to the Director as a result. The Supreme Court also stated that this change “aligns the PTAB with the other adjudicative body in the PTO, the Trademark Trial and Appeal Board.” Arthrex, 141 S. Ct. at 1987.

The Federal Circuit in Piano Factory noted that the above language from Arthrex showed that the Supreme Court believed TTAB judges were lawfully appointed as inferior officers.

The Federal Circuit also noted the trademark statutes gave the Director “significantly more supervisory control over administrative trademark judges and their decisions” than their PTAB counterparts. For example, Section 41 of the Lanham Act, 15 U.S.C. §1123, did not bar the Director from reviewing TTAB decisions. It was irrelevant whether the Director has implemented a procedure for rehearing TTAB decisions because whether the Director elects to exercise that authority does not affect the status of TTAB judges as inferior officers under the Appointments Clause.

As for the merits of the TTAB's trademark cancellation decision, the Federal Circuit affirmed the cancellation of the trademark registration because the registrant's pianos were falsely labeled with a German-sounding name to suggest that its pianos are high-quality European instruments, rather than lower quality instruments made elsewhere; and Schiedmayer is not just some arbitrary German-sounding name, but “a name long associated with a German manufacturer of high-end keyboard instruments,” improperly suggesting their Schiedmayer-branded pianos were made by that Schiedmayer company.

About the Author

Thomas P. Howard

Thomas Howard is an experienced trial lawyer that handles intellectual property litigation nationwide, including copyright, trademark, trade secret and patent litigation, as well as complex civil litigation, including breach of contract, interference with contract, breach of fiduciary duty, conspiracy, fraud and fraudulent transfer of assets.


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