Source: https://ipmall.law.unh.edu/content/ttab-trademark-trial-and-appeal-board-1-la-fara-importing-company-inc-v-f-lli-de-cecco-di
Timestamp: 2019-04-20 01:11:41+00:00

Document:
*1 LA FARA IMPORTING COMPANY, INC.
F. LLI DE CECCO DI FILIPPO FARA S. MARTINO S.P.A.
Coffee, tea, cocoa, sugar, rice, tapioca, sago, and coffee substitutes; flour and alimentary pastas, [FN2] namely, spaghetti, macaroni and noodles; bread, biscuits, cakes, pastry, candy, fruit ices, honey, treacle, yeast and baking-powder; salt, mustard, pepper and vinegar; sauces, excluding cranberry sauce and applesauce; spices and ice.
As grounds for opposition, opposer alleges that it, through a predecessor in interest, has been engaged continuously in the importation and distribution of pasta and related food products in the United States since March 29, 1953; that it is currently using the mark "LA FARA" in connection with numerous types of pasta; that since 1985 it has used the mark "LA FARA" in connection with spaghetti sauce; that opposer, through a predecessor in interest, was issued a registration for the mark "LA FARA" for alimentary pastes in 1954; [FN3] that on April 13, 1956 opposer, through its predecessor, entered into an agreement with applicant by which opposer, which was then a distributor of applicant's products in the United States, assigned its rights in the mark "LA FARA", along with the registration, to applicant; that the distribution agreement between applicant and opposer terminated in 1985; that applicant abandoned its rights obtained by the assignment by failing to use "LA FARA" as a mark for alimentary pastes or related goods for more than two years, instead using only the word "LA FARA" in its geographic sense, Fara San Martino being a region of Italy; that applicant did not use "LA FARA", the mark which is the subject of the registration, as a trademark between 1956 and 1985, and that applicant's date of first use is no earlier than its distribution of the goods with which the specimens submitted with its application were used; that opposer's use of "LA FARA" in the United States in connection with pasta products and spaghetti sauce predates applicant's use of "LA FARA" for such goods; and that the parties' marks are substantially identical and their goods are directly competitive and would travel through the same channels of trade, such that applicant's registration and use of its mark for the Class 30 goods identified in its application would be likely to cause confusion or mistake or deception.
In its answer, applicant admitted that Registration No. 587,900 issued on April 6, 1954; that opposer's predecessor assigned the "LA FARA" mark and registration to applicant; and that the distribution agreement between the parties terminated in 1985; denied the remaining salient allegations in the notice of opposition; and asserted affirmatively that opposer is estopped to pursue this opposition in view of the Board's decision dated April 17, 1987 in La Fara Importing Company, Inc. v. Flli de Cecco di Filippo, Cancellation No. 15,562; that opposer has no standing because it has not established that it is likely to be damaged; that opposer's and its predecessor's use inured to applicant's benefit; and that use, as alleged by opposer, of "LA FARA" in connection with goods not produced in Italy, is misleading.
*2 This case now comes up on applicant's motion which, because it contains matter outside the pleadings, is being treated as a motion for summary judgment.
The bases for applicant's motion are that opposer cannot legally be damaged by the registration of this application because applicant already owns a registration for the same mark, "LA FARA", for alimentary pastes, and that the claims asserted by opposer are barred under the doctrine of res judicata.
The granting of a motion for summary judgment is appropriate where there exists no genuine dispute as to any material fact and where the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Greyhound Corp. v. Both Worlds Inc., 6 USPQ2d 1635 (TTAB 1988).
Opposer has opposed the motion, not because it believes there are any genuine issues of material fact, but because it disagrees with applicant's conclusions of law.
We agree that there are no genuine issues of fact. The parties were previously involved in a cancellation in which opposer attempted to cancel applicant's Registration No. 587,900 for "LA FARA" for alimentary pastes. In that action opposer made several of the same allegations it has raised in the subject proceeding, including that registrant (applicant), by reason of its failure to use the mark for more than two years, had abandoned the rights it had obtained when the mark and registration were assigned to it, and that registrant had used only a portion of the mark, FARA, in its geographic sense.
Registrant (applicant) moved to dismiss that proceeding pursuant to Rule 2.132(a) on the ground that petitioner's testimony period had closed and petitioner (opposer) had not taken any testimony or offered any other evidence in support of its petition. The Board granted the motion, entered judgment against petitioner, and dismissed the petition for cancellation with prejudice.
Applicant argues that this decision acts as an estoppel against opposer's relitigating the abandonment and geographical use issues. Further, applicant argues that its incontestable registration precludes a priority contest regarding which of the parties first used "LA FARA" for alimentary pastes and related goods. Applicant recognizes that the cancellation proceeding did not deal with the issue of whether opposer used "LA FARA" in connection with any of the Class 30 goods, other than alimentary pastes, identified in applicant's current application. However, applicant claims that because the pleadings in the subject opposition contain no allegation that opposer has ever used the mark in connection with any of the Class 30 goods other than alimentary pastes and related goods, and because of the effect of the prior decision, in order to oppose successfully the registration of the current application opposer must establish that applicant had abandoned its trademark rights, and opposer cannot do this because of the decision in the prior cancellation action.
The principal concepts developed in this Chapter are: merger--the extinguishment of a claim in a judgment for plaintiff (§ 18); bar--the extinguishment of a claim in a judgment for defendant (§ 19); and issue preclusion--the effect of the determination of an issue in another action between the parties on the same claim (direct estoppel) or a different claim (collateral estoppel) (§ 27). The term "res judicata" is here used in a broad sense as including all three of these concepts. When it is stated that "the rules of res judicata are applicable," it is meant that the rules as to the effect of a judgment as a merger or a bar or as a collateral or direct estoppel are applicable.
Issue preclusion operates only as to issues actually litigated, whereas claim preclusion may operate between the parties simply by virtue of the final judgment. Thus, principles of merger and bar may apply even though a judgment results by default, although care must be taken to ensure the fairness of doing so. The Young Engineers v. U.S. International Trade Commission, 721 F.2d 1305, 1314, 219 USPQ 1142, 1151 (Fed.Cir.1983).
In this case, since no issues were litigated in the prior action, if res judicata applies it can rest only on principles of claim preclusion, which depends on whether opposer is again asserting the same claim.
§ 24(1) When a valid and final judgment rendered in an action extinguishes the plaintiff's claim pursuant to the rules of merger or bar (see §§ 18, 19), the claim extinguished includes all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction, or series of connected transactions, out of which the action arose.
There is no genuine issue that opposer made the same allegations in both the prior cancellation proceeding and in the subject action as to applicant's abandonment of the rights which it obtained through the assignment to it of the trademark "LA FARA" and Registration No. 587,900, and as to applicant's use of "FARA" only in its geographic sense. However, opposer argues that it is not estopped to raise the latter issue because only the issue of abandonment by reason of non-use was necessary to the determination of the cancellation proceeding. Moreover, opposer asserts that in the subject action it is not seeking the same relief sought in the cancellation action.
*4 Despite the fact that the former proceeding involved the cancellation of a registration, and the present one is an opposition, we find that the claim in both proceedings is in part the same, i.e. applicant's/registrant's right to a registration for "LA FARA" for alimentary pastes. While the present application is for a broad list of goods in Class 30, and not just for alimentary pastes, so that opposer's claim here is broader than in the earlier proceeding, the claim in the current proceeding encompasses that in the earlier one.
However, our ruling does not, as applicant appears to urge, result in a dismissal of the opposition. Although opposer cannot attack applicant's rights in "LA FARA" for alimentary pastes, applicant's present application includes an extended list of additional goods in Class 30, which were not involved in the prior proceeding and hence were not part of opposer's earlier claim. Thus, opposer is not precluded, either by the principle of claim preclusion or the incontestability of applicant's registration, from attempting to demonstrate its priority in the mark "LA FARA" for goods other than alimentary pastes, and from showing a likelihood of confusion between its use of the mark on such goods and applicant's use of the mark on the various Class 30 items. Because of the genuine issues of material fact which pertain to these questions, summary judgment in favor of applicant is not warranted.
This brings us to the second basis for applicant's motion, namely, its ownership of a subsisting registration of the mark sought to be registered herein. Again, we agree that there are no genuine issues of fact that applicant is the owner of an incontestable registration, No. 587,900, for the identical mark "LA FARA" for alimentary pastes. Applicant argues that because of this registration, and by virtue of the doctrine enunciated in Morehouse Mfg. Corp. v. J. Strickland Co., 407 F.2d 881, 160 USPQ 715 (CCPA 1969), opposer cannot suffer any additional damage from the registration of the current application.
That doctrine states that, as a matter of law, an opposer cannot be damaged within the meaning of Section 13 of the Statute by the issuance to the applicant of a second registration where applicant already has an existing registration of the same mark for the same goods.
The situation in the present case differs from that presented in Morehouse, however, in that the identification of goods in the application at issue is not only for alimentary pastes, but also includes a wide variety of additional items such as coffee, sugar, rice, cakes and sauces, excluding cranberry sauce and applesauce. Applicant claims that these other items are irrelevant because opposer has alleged in its pleadings use of its mark only in connection with pastas and spaghetti sauce. Applicant argues that all of opposer's goods are encompassed by or are substantially the same as the alimentary pastes of applicant's registration, and that opposer cannot be damaged by the registration of the additional goods listed in the identification because opposer has not alleged use of its mark in connection with them.
*5 We do not read Morehouse and its progeny as broadly as does applicant, nor do we accept applicant's characterization of opposer's spaghetti sauce as being substantially the same as alimentary pastes. In our view, these goods are neither identical, substantially the same, or so related so as to represent in law a distinction without a difference. See, Joseph & Feiss Co. v. Sportempos, Inc., 451 F.2d 1402, 172 USPQ 235 (CCPA 1971).
In summary, applicant's motion for summary judgment is granted to the extent that opposer is barred from raising the allegations of abandonment by nonuse or geographic use of part of the mark; the motion is otherwise denied. Trial dates are reset as shown in the accompanying order.
FN1. Application Serial No. 566,794, filed November 4, 1985, claiming a right of priority, pursuant to Section 44(d) of the Trademark Act, of May 9, 1985, based on an Italian application which issued to registration on November 15, 1985. The United States application is also for goods in Classes 29 and 31, but the opposition is limited to the goods in Class 30.
FN2. Alimentary paste is defined as "a shaped and dried dough (as macaroni, spaghetti and vermicelli) prepared from semolina, farina, or wheat flour or a mixture of these with water or milk and with or without egg or egg yolk, "Webster's Third International Dictionary, Unabridged, copyright 1976. It appears that this is the term which appropriately describes applicant's goods, and that the reference to "alimentary pastas" in the identification of goods is a typographical error. Accordingly, the identification of goods has been corrected, and this item will subsequently be referred to as "alimentary pastes".
FN3. Registration No. 587,900 for "LA FARA" for alimentary pastes, issued April 6, 1954; Section 8 affidavit accepted; Section 15 received; renewed.
FN4. Our finding is buttressed by the fact that to do otherwise would result in the anomalous situation of allowing opposer collaterally to attack a registration which it is prevented, by virtue of the dismissal with prejudice, from attempting to cancel. It is well settled that an attack upon the validity of a registration can be entertained only in the context of a petition to cancel the registration. See, Contour Chair-Lounge Co., Inc. v. Englander Company, Inc., 324 F.2d 186, 139 USPQ 285 (CCPA 1963), and Gillette Co. v. "42" Products Ltd., Inc., 396 F.2d 1001, 158 USPQ 101 (CCPA 1968).

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