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TTAB still constitutional post-Arthrex

February / March 2022 IP Newsletter

Last year, the U.S. Supreme Court found that the Patent Trial and Appeal Board’s (PTAB’s) administrative patent judges could constitutionally perform their duties only if they were appointed by the president and confirmed by the Senate. The U.S. Court of Appeals for the Federal Circuit has now weighed in on whether this reasoning applies to the Trademark Trial and Appeal Board’s (TTAB’s) administrative trademark judges (ATJs).

Mark strikes a chord

The issue came up in Piano Factory Group, Inc. v. Schiedmayer Celesta GMBH, a case involving a mark for keyboard musical instruments. Schiedmayer Celesta is the successor to a line of German companies that have sold such instruments under the Schiedmayer mark for almost 300 years.

Piano Factory Group sells pianos from retail outlets. Believing the Schiedmayer mark had been abandoned for pianos, Piano Factory acquired the domain name and obtained a trademark registration for the mark. It proceeded to fix the Schiedmayer label on pianos and sell them.

Schiedmayer filed a cancellation petition, seeking to cancel Piano Factory’s registration for the mark. It alleged that the mark falsely suggested a connection to it, in violation of federal trademark law. The TTAB granted the petition.

The Federal Circuit tunes in

On appeal, Piano Factory contended that the ATJs who ruled in its case were unconstitutionally appointed. It cited the Supreme Court’s ruling in U.S. v. Arthrex, Inc., which came out before the parties filed their appellate briefs.

The Federal Circuit, however, noted that one of the problems regarding the PTAB was that the Patent and Trademark Office (PTO) director couldn’t review its decisions. The Supreme Court’s remedy was to allow the PTO director to review final PTAB decisions and, on review, issue decisions on the board’s behalf.

Doing so aligned the PTAB with the other adjudicative body in the PTO — the TTAB. Thus, the Supreme Court effectively confirmed that the statutory scheme governing TTAB decision-making doesn’t suffer from the PTAB’s Appointment Clause problem.

The Trademark Modernization Act of 2020 (TMA) explicitly confirmed the PTO director’s authority to review TTAB decisions. But, because that law was enacted after the TTAB’s ruling in this case, Piano Factory argued that the pre-TMA ATJs were unconstitutionally appointed. The Federal Circuit rejected this notion. It pointed out that, even before the TMA, the trademark laws gave the PTO director supervisory control over ATJs.

A key decision

Things didn’t go as Piano Factory Group hoped, as the Federal Circuit affirmed the TTAB’s review structure. Any lingering uncertainty after Arthrex is moot.

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