The Third Circuit Court of Appeals recently issued an opinion regarding a dispute over the rights to the “EBONYS” trademark in relation to a Philadelphia soul band. Procedurally, the dispute arose in 2013, when David Beasley (“Beasley”) brought a petition to cancel a former bandmate’s (William Howard) trademark registration based upon fraud, which was subsequently dismissed. Later, in 2017, Beasley filed another petition asserting that Howard’s trademark was likely to cause confusion with Beasley’s purported rights and interests in his alleged “EBONYS” mark; however, the Board dismissed that petition as well.
Beasley then used Howard for trademark infringement in federal court, asking the Court to cancel Howard’s registration and ownership of the subject mark, and for damages as a result of the alleged infringement. The district court dismissed that case, holding that the Board had dealt with the same allegations, claims, and theories, and therefore was precluded. On appeal, Beasley asserted, and the Third Circuit agreed, with the proposition of law that claim preclusion was inapplicable because the Board’s review and rulings were confined to trademark registration ownership issues, and not whether infringement and resulting damages was present. In its September 17th opinion, the Third Circuit held that “[b]ecause the TTAB has no jurisdiction to consider whether an infringer's use of a mark damages a petitioner seeking cancellation, and in turn cannot award any remedy beyond cancellation," Beasley's claim is "not one that could have been brought in a TTAB cancellation proceeding.” Accordingly, the Third Circuit found that Beasley’s trademark infringement case should proceed, and therefore remanded the case back to the district court for further proceedings.