The federal district court in Alexandria, Virginia denied a motion to dismiss the Redskins trademark case, making it clear that the “Rocket Docket” is open for business and ready to hear cases brought by parties who are dissatisfied with decisions made by the Trademark Trial and Appeal Board (TTAB).  Pro-Football Inc. v. Blackhorse, 14-cv-01043, U.S. District Court, Eastern District of Virginia (Alexandria).

Parties who are dissatisfied with TTAB decisions can initiate “de novo” proceedings in a unique federal court — the district court in Alexandria known as the Rocket Docket.  That court, which is across the street from the Patent and Trademark Office (PTO), is called the “Rocket Docket” because cases there proceed from filing to trial in less than one year under accelerated procedures – that’s more than twice as fast as other federal courts around the country.

The background of this dispute is well known:  The Redskin’s federal trademark protection provides the Redskins with lucrative rights in the famous name, and the power to exclude others from using the same name in the marketplace.  Earlier this year, the TTAB cancelled the Redskins’ federal trademark registrations on the basis that it disparages Native Americans in violation of the Lanham Act.

The Redskins thereafter filed a complaint in the Rocket Docket seeking a fresh look at the TTAB’s decision.  In their motion to dismiss that Complaint, the defendants, a group of Native Americans who were the challengers at PTO, argued that the court lacked a judicially-cognizable dispute between them and the Redskins.  The motion to dismiss essentially argued that the Redskins sued in the wrong court and should be limited to an “appeal” of the TTAB decision in the U.S. Court of Appeals for the Federal Circuit.

Judge Gerald Bruce Lee’s opinion rejected the defendants’ argument, saying that if it was okay for the Native Americans to ask the PTO to cancel the Redskins’ trademark, then it was okay for them to serve as defendants in the follow on lawsuit.  Judge Lee stated that the defendants can “show no reason why their interest would cease to exist” especially considering the fact that if the Redskins win in court, and TTAB’s cancellation of the Redskins mark is reversed, the Native Americans would be subject to the very harm they sought to eliminate by filing the challenge at the PTO in the first place.  The Native Americans argued that they were not the real party in interest because they were not seeking to use the Redskins name and had no pecuniary interest.  In addition they were not proper defendants considering the nature of the Redskins case is to challenge not only the PTO’s decision but also the PTO’s authority to do what it did (including constitutional defenses related to the First Amendment and due process).  The Lanham Act provides that in a case like this, where there are challengers at the PTO (i.e., an “inter parties proceeding” where the Native Americans participated at PTO as adverse parties), the PTO itself may not be named as a defendant or considered an indispensable party.

Judge Lee’s decision makes it clear that the Redskins were not limited only to an “appeal” to the Federal Circuit, which would review the TTAB’s decision under a deferential standard of review.  Instead, the Redskins were within their rights to make a more aggressive play, and file a new civil lawsuit in the Rocket Docket.  Unlike an appeal to the Federal Circuit, a new lawsuit in the district court gives the Redskins a fresh bite at the apple – in the district court, the TTAB’s decision will not receive deference and the Redskins will be able to present new evidence and will not be limited to the administrative record as they would in an appeal.  The United States may intervene in the case to defend the PTO given the constitutional challenges.

There is one line in the decision that says that a contrary result would deprive the Redskins of the opportunity to challenge the TTAB in “an Article III court.”  However, that is an overstatement given that none of the parties denied the Redskins’ right to appeal to the Federal Circuit.

The Redskins are not the first parties to take advantage of filing a lawsuit in the Rocket Docket after a loss at the TTAB.  There have been several other cases recently brought in the Rocket Docket to challenge PTO decisions, including Shammas v. Rea, 978 F. Supp. 2d 599 (E.D. Va. 2013) and Timex Group USA, Inc. v. Focarino, Case No. 1:12-cv-1080, 2013 U.S. Dist. LEXIS 177835 (E.D. Va. Dec. 17, 2013).

Although it can be significantly more intense and expensive to file a brand new lawsuit than it is to appeal a TTAB decision to the Federal Circuit, when the stakes are high enough, a company might elect the new-lawsuit option – especially when they seek to present new evidence.  The court’s decision here confirms that the courthouse door will be open to such new lawsuits challenging decisions made by the PTO.

Take away:

  1. If you are a party dissatisfied with a TTAB decision, you have two options to challenge the decision:  (a) conventional administrative appeal to the Federal Circuit; (b) new lawsuit in the Rocket Docket.
  2. If you are a challenger at the PTO in an inter parties proceeding, and you win, you may be dragged along into a follow on lawsuit in the Rocket Docket as the defendant.  You may or may not get help from PTO in defending the case, either through formal intervention or otherwise.
  3. The Redskins case is sure to proceed quickly in the Rocket Docket, with a decision within a year, and an appeal thereafter to the Fourth Circuit (not the Federal Circuit).  In the meantime, the Redskins retain their trademark rights.
  4. Litigating in the Rocket Docket requires having counsel familiar with the unique procedures there, including the fast-track process that causes cases to move more than twice as fast as any court in the country.