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Princeton Vanguard, LLC v. Frito-Lay North America, Inc.

United States District Court, W.D. North Carolina, Charlotte Division

October 21, 2019



          Kenneth D. Bell United States District Judge.

         This case is before the Court sua sponte to consider whether this Court has subject matter jurisdiction over this dispute. The issue before the Court, which appears to be a matter of first impression in this Circuit and perhaps nationally, is whether Plaintiffs have the right to file a civil action in District Court to appeal an adverse remand decision of the Trademark Trial and Appeal Board (“TTAB”) after Plaintiffs already appealed the TTAB's initial ruling that their trademark is generic to the United States Court of Appeals for the Federal Circuit. After a full review of the relevant proceedings in the TTAB and the Federal Circuit, the governing statute and the parties' arguments, the Court finds that Plaintiffs waived their right to proceed in District Court by initially taking their appeal to the Federal Circuit. Therefore, this action will be dismissed without prejudice for lack of subject matter jurisdiction.


         None of the parties raised the issue of subject matter jurisdiction in this action. However, because it defines a court's power to adjudicate cases and controversies, whether a court has subject matter jurisdiction is a “threshold matter” that a court must consider prior to reaching the merits of a dispute. See Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 94-95 (1998); Sucampo Pharmaceuticals, Inc. v. Astellas Pharma, Inc., 471 F.3d 544, 548 (4th Cir. 2006). “Federal courts are not courts of general jurisdiction; they have only the power that is authorized by Article III of the Constitution and the statutes enacted by Congress pursuant thereto.” Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541 (1986). No. other matter can be decided without subject matter jurisdiction. See United States v. Cotton, 535 U.S. 625, 630 (2002); U.S. v. Wilson, 699 F.3d 789, 793 (4th Cir. 2012).

         Subject-matter jurisdiction cannot be conferred by the parties, nor can a defect in subject-matter jurisdiction be waived or forfeited by the parties. Id. Accordingly, questions of subject-matter jurisdiction may be raised at any point during the proceedings and indeed must be raised sua sponte by the court when it appears that the court may lack jurisdiction. See Wilson, 699 F.3d at 793; Brickwood Contractors, Inc. v. Datanet Engineering, Inc., 395 F.3d 385, 390 (4th Cir. 2004). A court must dismiss an action pursuant to Federal Rule of Civil Procedure 12(h)(3) “if the court determines at any time that it lacks subject matter jurisdiction.” See Fed.R.Civ.P. 12(h)(3). The plaintiff bears the burden of proving subject matter jurisdiction. Richmond, F. & P.R. Co. v. United States, 945 F.2d 765, 768 (4th Cir. 1991).


         Broadly stated, in this action the parties dispute whether Plaintiff Princeton Vanguard, LLC[1] is entitled to register the trademark PRETZEL CRISPS with the United States Patent and Trademark Office (“USPTO”).[2] More specifically, Defendant Frito-Lay North America, Inc. (“Frito-Lay”) asserts that the trademark is not entitled to registration because it is a generic mark or, in the alternative, lacks secondary meaning. See Frito-Lay N. Am., Inc. v. Princeton Vanguard, LLC, 109 U.S.P.Q.2d (BNA) 1949, 1950 (T.T.A.B. 2014).

         In 2010, Frio-Lay filed its opposition to the registration of the mark with the USPTO. An extensive record of documents, declarations, expert witness testimony and other evidence was developed by the parties and was submitted by agreement to the TTAB for a trial on the papers. On February 28, 2014, the TTAB ruled in favor of Frio-Lay, finding that the mark was generic and cancelling the registration of the mark on the Supplemental Register and denying Princeton Vanguard's application to register the mark on the Principal Register. Id.

         Plaintiffs appealed that ruling to the Federal Circuit pursuant to 15 U.S.C. § 1071(a). The Federal Circuit, in a thorough, published opinion, considered the evidence and proceedings in the TTAB and determined that the TTAB applied the incorrect legal standard in evaluating whether the mark was generic. Accordingly, the Federal Circuit vacated the TTAB decision and remanded the case for “application of the correct legal test.” Princeton Vanguard, LLC v Frito-Lay N. Am., Inc., 786 F.3d 960, 970 (Fed. Cir. 2015). In its opinion, the Federal Circuit plainly envisioned that it would be reviewing the case again after remand. Id. (declining to analyze all the parties' arguments with respect to the evidence of record “[g]iven … our decision to remand, ” but describing the nature of the Federal Circuit's future appellate review for “substantial evidence” and noting “[o]ur review under [the substantial evidence] standard ‘can only take place when the agency explains its decisions with sufficient precision, including the underlying factfindings and the agency's rationale.' (citation omitted).”)

         On remand, neither party sought to introduce new or additional evidence into the record. The TTAB ordered the parties to rebrief the case on the original record, and the case was then considered on remand based on that record. See Frito-Lay N. Am., Inc. v. Princeton Vanguard, LLC, 124 U.S.P.Q.2d 1184, 1204-06 (T.T.A.B. 2017). In its opinion on remand, the TTAB sought to follow the Federal Circuit's directions[3] and issued a lengthier, more detailed opinion describing its analysis of the parties' factual contentions and legal claims. Ultimately, however, the TTAB reached the same conclusion that the mark PRETZEL CRISPS was generic and, in the alternative, concluded that the mark was descriptive and had not acquired secondary meaning.

         The Plaintiffs did not appeal the TTAB's opinion on remand to the Federal Circuit. Instead, on November 6, 2017, Plaintiffs filed a civil action in this Court seeking review of the TTAB's remand opinion pursuant to 15 U.S.C. § 1071(b). This matter was reassigned to the undersigned judge on June 14, 2019. In the course of reviewing the parties' respective motions for summary judgment, the Court determined that the issue of subject matter jurisdiction needed to be considered, and on September 27, 2019 asked the parties to file memoranda of law addressing jurisdiction.[4] The parties filed their memoranda on October 10, 2019 and the matter is ripe for decision.


         It appears that the issue before the Court has not previously been decided.[5] Therefore, the proper place for the Court to start its analysis of whether it has subject matter jurisdiction is with 15 U.S.C. § 1071, the statute under which Plaintiffs claim jurisdiction. If Plaintiffs do not have the right to appeal to the District Court under that statute, then the parties concede that this Court does not have subject matter jurisdiction to review the TTAB remand opinion.

         In relevant part, 15 U.S.C. §1071 provides:

(a) Persons entitled to appeal; United States Court of Appeals for the Federal Circuit; waiver of civil action; election of civil ...

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