65 F.4th 1012
9th Cir.2023Background
- CEFCU (Illinois) owns a registered trademark “CEFCU. NOT A BANK. BETTER.” and claims a common-law mark “NOT A BANK. BETTER.”; SDCCU (San Diego) uses and registered a different slogan mark in California.
- CEFCU petitioned the TTAB in 2017 to cancel SDCCU’s registration, alleging likelihood of confusion and prior use; SDCCU deposed CEFCU witnesses during those proceedings.
- SDCCU sued in federal district court for declaratory relief: non-infringement of CEFCU’s registered and common-law marks and invalidity of those marks; it obtained a stay of the TTAB cancellation proceeding.
- The district court granted summary judgment to SDCCU on non-infringement, then tried and held CEFCU’s common-law mark invalid and awarded SDCCU attorneys’ fees.
- On appeal the Ninth Circuit held the district court lacked Article III jurisdiction to adjudicate invalidity of CEFCU’s common-law mark after the summary judgment finding of non-infringement, vacated the invalidity judgment and the fee award (insofar as based on the invalidity ruling), and affirmed personal jurisdiction and dismissal of CEFCU’s counterclaim.
Issues
| Issue | SDCCU's Argument | CEFCU's Argument | Held |
|---|---|---|---|
| Whether Article III jurisdiction existed to decide invalidity of CEFCU’s common-law mark after district court granted SDCCU summary judgment of non-infringement | SDCCU argued it retained a concrete interest in invalidating CEFCU’s common-law mark because cancellation could affect ongoing TTAB proceedings and future conflicts | CEFCU argued that once district court ruled non-infringement, SDCCU had no ongoing personal stake to seek invalidation and the claim became moot | Court: No. After SJ on non-infringement, SDCCU no longer faced a threatened injury traceable to the mark’s validity; invalidity claim lacked Article III jurisdiction and judgment vacated |
| Whether a justiciable controversy existed at pleading/summary judgment stages (reasonable apprehension standard) | SDCCU argued CEFCU’s TTAB petition plus deposition testimony and discovery created a reasonable apprehension of infringement suit | CEFCU argued TTAB petition alone and geographic separation made an infringement threat unlikely and thus no Article III case or controversy | Court: A live controversy existed at pleading and summary judgment stages—TTAB petition plus CEFCU witnesses’ testimony about expansion and likely confusion made SDCCU’s apprehension reasonable; SJ for SDCCU on non-infringement affirmed |
| Whether attorneys’ fees under 15 U.S.C. §1117(a) were properly awarded | SDCCU claimed prevailing-party and exceptional-case grounds based on trial victory and litigation misconduct | CEFCU argued fees improper because invalidity decision was beyond Article III jurisdiction and other challenges | Court: Vacated the fee award insofar as it relied on the invalidity trial outcome; remanded for reassessment of prevailing-party and exceptional-case determinations consistent with Article III limits |
| Whether district court had statutory jurisdiction to adjudicate CEFCU’s counterclaim to cancel SDCCU’s registration (15 U.S.C. §1119) | SDCCU argued §1119 covered the action because the litigation involved registered marks originally | CEFCU contended dismissal without prejudice deprived it of TTAB alternatives and sought reversal | Court: Affirmed dismissal without prejudice—§1119 is remedial and requires an independent jurisdictional basis; absent viable claims supporting §1119 jurisdiction, dismissal stands |
Key Cases Cited
- MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007) (clarifies declaratory-judgment standing when a party faces coerced choice to pay or risk litigation)
- Already, LLC v. Nike, Inc., 568 U.S. 85 (2013) (mootness in trademark suits; defendant bears burden to show case mooted by covenant or equivalent)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (Article III standing requirements)
- Chesebrough-Pond's, Inc. v. Faberge, Inc., 666 F.2d 393 (9th Cir. 1982) (reasonable-apprehension test for declaratory relief in trademark context)
- Societe de Conditionnement en Aluminium v. Hunter Eng'g Co., 655 F.2d 938 (9th Cir. 1981) (framework for when trademark disputes ripen into justiciable controversies)
- Clapper v. Amnesty Int'l USA, 568 U.S. 398 (2013) (limits on speculative future injury; discussed re: applicability to trademark declaratory suits)
- Altvater v. Freeman, 319 U.S. 359 (1943) (patent-case precedent on noninfringement and invalidity adjudication)
- Dawn Donut Co. v. Hart's Food Stores, Inc., 267 F.2d 358 (2d Cir. 1959) (senior user may enjoin junior user when senior is likely to expand into junior's territory)