Baxter Laboratories, Inc. v. Don Baxter, Inc.

186 F.2d 511, 38 C.C.P.A. 786, 88 U.S.P.Q. (BNA) 287, 1951 CCPA LEXIS 289

• Court: Court of Customs and Patent Appeals
• Decided: January 29, 1951
• Docket: Special Patent Docket 45
• Status: Published

Opinions

JOHNSON, Judge.

The decision of the Commissioner of Patents in this case (1) sustained the opposition filed by Baxter Laboratories, Inc. to the registration on the principal register sought by Don Baxter, Inc., and, in addition, (2) denied ex parte the registration of the applicant’s mark.

The issue presented for the Commissioner’s decision inter partes in the opposition proceeding was whether the applicant and opposer companies are related companies within the meaning of Section 5 of the Lanham Act, Trade-Mark Act of 1946, 15 U.S.C.A. § 1055. Don Baxter, Inc., sought registration of the mark “Baxter” on pharmaceutical preparations, claiming use of the mark by itself and by the Baxter Laboratories, Inc. as use by related companies, as provided by Section 5 of the Act. The mark was passed for registration under that provision of the Act, whereupon Baxter Laboratories, Inc. filed an opposition to the registration of the mark denying that Baxter Laboratories, Inc. and Don Baxter, Inc. are related companies. An issue was thus reached inter partes, and the Commissioner decided that issue in favor of the opposer. Registration of the mark on the basis of use by related companies was thus denied applicant, Don Baxter, Inc.

Before the Commissioner, the applicant, Don Baxter, Inc., also contended that it was entitled to registration of the mark “Baxter” for certain western states on the basis of concurrent user, relying on the concurrent registration provision of Section 2(d) of the Lanham Act, 15 U.S.C.A. § 1052(d). The Commissioner, on opposer’s objection, declined to consider that question inter partes, but he did consider applicant’s contention ex parte. As an ex parte matter, the Commissioner held that the applicant, Don Baxter, Inc., is not entitled to the registration for which it applied, considering its application as one for registration as concurrent user.

The applicant seasonably filed with the Commissioner its notice of appeal to the Court of Customs and Patent Appeals. The notice sets out twenty-one reasons of appeal, eleven of which are directed to the decision on the inter partes issue of use by related companies, and ten of which are directed to the Commissioner’s ex parte denial of registration considering the application as one for registration as concurrent user.

The opposer, Baxter Laboratories, Inc., thereupon promptly filed with the Commissioner its notice of “election to have all further proceedings conducted as provided in R.S. § 4915.”

The application and proceedings below are based upon the provisions of the Lan-ham Act, 15 U.S.C.A. § 1051 et seq. As to appeals from the decision of the Commissioner of Patents, Section 21 of the Act provides inter alia that any applicant for registration of a mark and any party to an opposition proceeding who is dissatisfied with the Commissioner’s decision may appeal to this court or proceed under R.S. § 4915, 35 U.S.C.A. § 63. The applicant herein, Don Baxter, Inc., thus had the option to come here or go into a District Court of the United States in a proceeding de novo. He elected to come here.

Section 21 of the Lanham Act also provides, however, that any party who is satisfied with the Commissioner’s decision may, upon the taking of an appeal here by any dissatisfied party, elect to have all further proceedings conducted under R.S. § 4915, as provided in R.S. § 4911, 35 U.S.C.A. §§ 63, 59a. R.S. § 4911 requires that an appeal brought here by a dissatisfied party shall be dismissed if his adversary within twenty days files his notice of election to proceed under R.S. § 4915. After such election and dismissal, the appellant (dissatisfied party) must within thirty days file his complaint in a District Court of the United States initiating a proceeding de novo in equity, or have the decision appealed from stand by his default.

Baxter Laboratories, Inc., therefore, as the satisfied party to an opposition decided by the Commissioner, had the right, after Don Baxter, Inc. filed its notice of appeal to this court, to elect to have all further proceedings in the opposition conducted in the District Court. The notice of such election filed by Baxter Laboratories, Inc. requires this court to dismiss the appeal from the Commissioner’s decision in the inter partes proceeding. This, however, does not dispose of the appeal, since the applicant appealed not only from the Commissioner’s inter partes decision sustaining the opposition, but also from the Commissioner’s ex parte decision denying registration as concurrent user.

The Commissioner has not only the right but the duty in an opposition proceeding to determine ex parte and without reference to the issue raised by the notice of opposition whether the applicant’s mark is entitled to registration. Dubonnet Wine Corp. v. Ben-Burk, Inc., 121 F.2d 508, 28 C.C.P.A, Patents, 1298; Columbia Broadcasting System, Inc. v. Technicolor Motion Picture Corp, 166 F.2d 941, 35 C.C.P.A., Patents, 1019. When an appeal is before the court in such a case, the opposer has no right to be heard on the ex parte ground, Chrysler Corp. v. Trott, 83 F.2d 302, 23 C.C.P.A, Patents, 1098, 1106; Revere Paint Co. v. Twentieth Century Chemical Co, 150 F.2d 135, 32 C.C.P.A, Patents, 1096, 1101, as only the Commissioner of Patents is qualified to represent the interests of the public in ex parte registration proceedings. Island Road Bottling Co. v. Drink-Mor Beverage Co, 132 F.2d 129, 30 C.C.P.A., Patents, 708; McKesson & Robbins, Inc. v. Isenberg, 167 F.2d 510, 35 C.C.P.A, Patents, 1095; Derenberg, The Patent Office as Guardian of the Public Interest, 14 Law and Contemp. Problems 288, 317-18. An opposer may, under Section 21 of the Lanham Act, by exercising his right of election, force a dissatisfied applicant-appellant to challenge the Commissioner’s inter partes decision in the opposition proceeding in an action de novo in equity in a District Court of the United States or not at all, but an opposer is without standing to affect a dissatisfied applicant’s appeal to this court from an ex parte decision of the Commissioner denying registration of a mark. Island Road Bottling Co. v. Drink-Mor Beverage Co, supra; see Schering & Glatz, Inc. v. Sharpe & Dohme, Inc, 146 F.2d 1019, 32 C.C.P.A., Patents, 827.

The effect of the opposer’s notice of election in this case, therefore, is to require the court to dismiss the appeal from' the Commissioner’s decision on the inter partes issue of registrability based on use by related companies, but to retain jurisdiction of the appeal from the Commissioner’s decision in the ex parte denial of registration to Don Baxter, Inc. of the mark “Baxter” sought on the basis of concurrent user. The applicant-appellant should perfect his appeal here in the normal manner appropriate for an ex parte appeal.¹

In order that there may be no misunderstanding- by the parties, the court takes notice of a point of possible confusion in connection with the retaining of the appeal in the ex parte case concerning the Commissioner’s denial of registration under the concurrent use provision of the Lanham Act, Section 2(d) which is that this court, even if it should disagree with the Commissioner’s decision on the point, would have to remand the case to the Patent Office for further proceedings there. Section 2(d) requires as a condition precedent to passing a mark for registration based on concurrent use, that “The Commissioner shall give not less than thirty days’ written notice to all applicants, registrants, and users specified by any of the parties concerned of any application for concurrent registration and of the time and place of the hearings thereon.” Such notice was not given in this case, so while the court could reverse the Commissioner as to the particular grounds on which the Commissioner denied registration of applicant’s mark based on the concurrent use section, the case would have to be remanded so that the Commissioner could give proper notice to interested parties and give them a hearing on the issue of the registrability of applicant’s mark based on concurrent user. After all that has been done, if the mark were to be passed for registration again, it would still be sub’ect to opposition proceedings.

Mention is made of this because the opposer herein may otherwise interpret the court’s retaining of jurisdiction in the ex parte issue to mean that the court may possibly reverse the Commissioner without remanding, that is, reverse in such a way as to authorize the Commissioner to register the mark forthwith without regard to the requirement of notice above mentioned. In so saying, the court would not be understood as intimating any conclusion on the merits of the ex parte issue.

1 . It has been suggested in this case, involving both an inter partes decision and an ex parte decision, that “all further proceedings under R.S. § 4915” will bring before the District Court “every issue as to the registrability of appellant’s mark, including the commissioner’s ex parte rejection. * * * ” This type of suggestion has prompted one learned commentator to state: “It is submitted that it indeed does make a difference whether the decision appealed from was an ex parte rejection or involved an adjudication of the respective rights of two or more private parties. Failure to recognize this distinction under the Act of 1905 has led to an almost incredible state of confusion among the various courts and has resulted in the necessity in recent years of bringing parallel actions against both the successful opposer and the Commissioner of Patents in the Dis: trict of Columbia and in the district in which the successful opposer is located.” (Derenberg, The Patent Office as Guardian of the Public Interest, 14 Law and Contemp. Problems 288, 318.)

That the removal of the inter partes appeal from this court to R.S. § 4915 route will not bring the ex parte issue before whatever District Court gets jurisdiction of the inter partes issue is apparent upon an examination of the cases which have been decided in the circuits since the Lanham Act.

In Gardel Industries v. Kingsland, D. C.Cir, 178 F.2d 974, it was held that under See. 21 of the Lanham Act, in a R. S. § 4915 opposition proceeding, the op-poser is a necessary party while the Commissioner of Patents is not a necessary party. The dissatisfied applicant must, therefore, if the R.S. § 4915 route is followed. bring his action against the opposer 'ti the latter’s jurisdiction (apparently r Laboratories, Inc. is located in lUiHW and Don Baxter, Inc, in California) rather than in the District of Columbia. But jurisdiction over the Commissioner of Patents may only be se-eured in the District of Columbia (unless, improbably, he consents to appear outside of the District of Columbia) and by Section 21, the Commissioner cannot be brought into an inter partes' proceeding even in the District of Columbia unless he consents to intervene.

This illustrates the improbability of the applicant being able to secure relief from the Commissioner’s ex parte decision denying registration of applicant’s mark in any proceeding on the inter partes issue in District Court against the opposer. Moreover, it is doubtful that even in the fortuitous circumstance where jurisdiction over both the Commissioner and opposer lies in the District of Columbia that the applicant could join them as parties defendant in a single action: Rule 19, Federal Rules of Civil Procedure, 28 U.S.C.A., is not applicable, as the opposer and the Commissioner do not have a “joint interest”; Rule 20, Federal Rules of Civil Procedure, would not apply, as the applicant is not actually asserting against the opposer and Commissioner jointly, severally, or in the alternative any right to relief arising out of the same transaction or occurrence, nor does any question of law or fact common to all of them arise in the action. The ex parte rejection is not the same occurrence as the inter partes decision sustaining the opposition, and the question of law and fact in the related companies issue of the inter partes decision is not a common one with the concurrent user issue in the ex parte decision.

The difficulties which would beset the disappointed applicant herein in securing a review of the ex parte rejection of his mark sought on the ground of concurrent user, should this court dismiss the appeal as to the ex parte issue, are illustrated by the cases of Drackett Co. v. Chamberlain Co., 3 Cir., 1936, 81 F.2d 866, and Lanolin Plus Cosmetics, Inc. v. Botany Mills, Inc., 3 Cir., 1949, 177 F.2d 756, where R.S. § 4915 actions seeking a review of the Commissioner’s decisions in opposition proceedings wherein he decided not only the inter partes issues but denied registration ex parte in each case as well, thereby distinguishing these cases from the Gardel Industries case, supra, were brought in the District Court for the District of New Jersey by the applicant therein. The District Court dismissed the action in each case, and the Court of Appeals for the Third Circuit affirmed on the ground that the Commissioner of Patents is an indispensable party to the R.S. § 4915 appeal where he “has refused registration of the mark upon statutory grounds” referring to the ex parte rejection in each case. In the Lanolin Plus case the court took note of Section 21 of the Lanham Act and its provision that the Commissioner is not an indispensable party in an inter partes proceeding, but because the case involved an ex parte rejection by the Commissioner, the court, held that the Commissioner was an indispensable party. Since the court did not have jurisdiction over the Commissioner in the action, the case was dismissed.

If we, therefore, were to dismiss the ex parte appeal along with the inter partes appeal, the applicant would have to bring an action on the inter partes issue against the opposer where he could get jurisdiction over him, R. J. Moran Co. v. Seeck & Kade, Inc., D.C.S.D.N.Y.1950, 91 F.Supp. 188, and an action against the Commissioner of Patents on the ex parte denial of registration in the District of Columbia. He might not even be able to maintain the latter, as the District of Columbia courts might hold that applicant in electing to appeal to the Court of Customs and Patent Appeals initially, lost his right to a subsequent action under R.S. § 4915.

We do not believe that Congress intended to subject an applicant who has appealed here after losing his right to registration on both inter partes and ex parte grounds in the Patent Office during an opposition proceeding to such uncertainty of remedy merely because the opposer exercises his right of election on the inter partes matter. Nor do we believe that Congress intended that it should be within the successful opposer’s power to frustrate an applicant’s appeal on an ex parte rejection in which the opposer is not, and has never been, entitled to be heard in any stage of the proceedings ex parte between the applicant and the Commissioner of Patents as representative of the public’s interests.