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Plaintiff’s Trademark Infringement Claims Barred Under Doctrine of Collateral Estoppel After Prior Registration Case Decided by Trademark Board

Keith A. Ashe v. The PNC Financial Services Group, Inc.
No. PWG-15-144 (December 17, 2015, U.S. District Court for the District of Maryland)

by Caroline E. Willsey, Law Clerk
Semmes, Bowen & Semmes (

Available at:,%20Ashe%20v%20PNC%2020151026%20Memo%20v3%20(filed).pdf

In Keith Ashe v. The PNC Financial Services Group, Inc., No. PWG-15-144, Judge Grimm of the U.S. District Court for the District of Maryland issued a published decision regarding Plaintiff Keith Ashe’s (“Plaintiff” or “Ashe”) claims that Defendant The PNC Financial Services Group, Inc. (“Defendant” or “PNC”) infringed on his SPENDOLOGY trademark. Judge Grimm granted PNC’s motion to dismiss, holding that Ashe’s claim was barred under the doctrine of collateral estoppel.

Ashe alleged that PNC’s use of the SPENDOLOGY trademark was a willful and wanton violation of the Lanham Act. The court decided to treat Ashe’s claim as a trademark infringement claim under 15 U.S.C. § 1125(a). Ashe alleged that he began using the SPENDOLOGY trademark on June 21, 2010 for a website “featuring non-downloadable instructional videos in the field of finance, online financial calculators, and online information in the field of finance.” Ashe’s trademark application was published in the U.S. Patent and Trademark Office’s Official Gazette on June 12, 2012. On October 10, 2012, PNC filed a Notice of Opposition with the Trademark Trial and Appeals Board (“Trademark Board”) to prevent the registration of Plaintiff’s mark. The Trademark Board concluded that PNC had established prior use of the SPENDOLOGY trade mark, and refused Ashe’s application to register the trademark.

PNC filed a motion to dismiss for failure to state a claim under Fed. R. Civ. P. 12(b)(6). Ashe filed an opposition and PNC filed a reply.

The court began its discussion by noting that if an affirmative defense clearly appears on the face of the complaint, the Court may rule on that defense when considering a motion to dismiss. The court notes that collateral estoppel, also known as issue preclusion, is one such affirmative defense. Res judicata and collateral estoppel are based on the theory that the losing defendant does not deserve a rematch on issues that have been raised or should have been raised in a prior adversarial proceeding. From the face of Ashe’s complaint, the court noted that Ashe was asserting priority regarding the SPENDOLOGY trademark. The court concluded that in making these claims, Ashe was attempting to relitigate issues that were previously decided by the Trademark Board. Therefore, the court determined that it would decide the motion to dismiss under the doctrine of collateral estoppel.

The Supreme Court recently held that “a court should give preclusive effect to [Trademark Board] decisions if the ordinary elements of issue preclusion are met.” B & B Hardware, Inc. v. Hargis Indus., Inc., 135 S. Ct. 1293, 1299 (2015). The court noted that the burden was on PNC to demonstrate that (1) the issues or facts in Ashe’s complaint were identical to the ones previously litigated; (2) the issues or facts were actually resolved in the prior proceeding; (3) the issues or facts were critically necessary to the judgment in the prior proceeding; (4) the judgment in the prior proceeding was final and valid; and (5) Ashe had a full and fair opportunity to litigate the issue or fact in the prior proceeding.

Judge Grimm spent the bulk of the opinion analyzing the identical nature of the issues in the prior Trademark Board proceeding and the current case. In registration cases, like the case brought before the Trademark Board, priority is determined by the common law and Lanham Act, which “require that trademark ownership be accorded to the first bona fide user.” The party claiming ownership must have been the first to actually use the mark in the sale of goods or services. Therefore, it is possible that a party can establish an earlier priority date than the date of registration through use analogous to trademark use (i.e., use of a nature and extent such as to create an association of the term with the user’s goods). The Trademark Board determined in the prior proceeding that PNC had proved it had a proprietary interest in the SPENDOLOGY trade mark prior to the filing date of Ashe’s trademark application.

Similarly, in infringement cases, like the one before the court, trademark ownership is acquired by actual use of the mark in a given market. Federal courts apply the same “use analogous to trademark use” standard, discussed above, to determine priority in infringement cases. The District of Maryland had previously found the issue of priority determined in an earlier proceeding before the Trademark Board to be identical to priority use in an infringement suit. The court concluded that Ashe had not offered any precedent directly addressing any difference between the issue of priority of use in registration cases before the Trademark Board and the issue of priority in infringement cases. The court rejected Ashe’s argument that B & B Hardware stood for the proposition that priority in registration cases differs from priority in infringement cases. B & B Hardware did not involve the issue of priority in registration, but rather the distinct issue of likelihood of confusion, which is examined differently by the Trademark Board and federal district courts. The likelihood of confusion has never been disputed by PNC or Ashe. Accordingly, the court concluded that the issues were the same for collateral estoppel purposes.

The court quickly disposed of the second element (resolution of the issues) noting that the issue of PNC’s priority use of the SPENDOLOGY trademark relative to Ashe was resolved in the Trademark Board’s ruling.

Likewise, the court summarily noted that the issue of priority was critical and necessary to the judgment by the Trademark Board, as priority is a “threshold question” in registration proceedings.

The court noted that the Trademark Board’s ruling was final, as Ashe did not appeal the Trademark Board’s decision.

Finally, the court concluded that Ashe had a full and fair opportunity to litigate the issue of priority before the Trademark Board. There was no evidence that the Trademark Board’s procedures were “ill-suited” for the particular issue of determining priority as to the SPENDOLOGY trademark. In reaching such a conclusion, the court noted that it was not necessary that the Trademark Board and the federal courts have identical procedures for resolving the issues.

Because PNC demonstrated all five elements required for issue preclusion with respect to the Trademark Board’s determination that PNC had priority of use of the SPENDOLOGY trademark, the Court held that Ashe’s claim was barred under the doctrine of collateral estoppel. Ashe’s claim was dismissed accordingly.