Rosenruist-Gestao E Servicos v. Virgin Enterprises

• Decision Date: 27 December 2007
• Docket Number: No. 06-1588.,06-1588.
• Citation: 511 F.3d 437
• Parties: ROSENRUIST-GESTAO E SERVICOS LDA, formerly known as Rosenruist-Gestao E Servicos Sociedade Unipessoal LDA, Plaintiff-Appellee, v. VIRGIN ENTERPRISES LIMITED, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fourth Circuit

511 F.3d 437

ROSENRUIST-GESTAO E SERVICOS LDA, formerly known as Rosenruist-Gestao E Servicos Sociedade Unipessoal LDA, Plaintiff-Appellee, v. VIRGIN ENTERPRISES LIMITED, Defendant-Appellant.

No. 06-1588.

United States Court of Appeals, Fourth Circuit.

Argued March 16, 2007.

Decided December 27, 2007.

ARGUED: James Wilson Dabney, Fried, Frank, Harris, Shriver & Jacobson, L.L.P., New York, New York, for Appellant. Douglas Vernon Rigler, Young & Thompson, Arlington, Virginia, for Appellee. ON BRIEF: Darcy M. Goddard, Fried, Frank, Harris, Shriver & Jacobson, L.L.P., New York, New York, for Appellant. Andrew J. Patch, Jeff Goehring, Young & Thompson, Arlington, Virginia, for Appellee.

Before WILKINSON and TRAXLER, Circuit Judges, and WILKINS, Senior Circuit Judge.

Reversed and remanded by published opinion. Judge TRAXLER wrote the majority opinion, in which Senior Judge WILKINS joined. Judge WILKINSON wrote a dissenting opinion.

OPINION

TRAXLER, Circuit Judge.

Rosenruist-Gestao E Servicos LDA ("Rosenruist") is a Portuguese company that seeks to obtain a United States trademark registration and enjoy the benefits that accompany ownership of a registered mark under the Lanham Act. Virgin Enterprises Ltd. ("VEL"), a British conglomerate that owns numerous United States registrations, opposes the registration of Rosenruist's mark and commenced an administrative proceeding before the Trademark Trial and Appeal Board ("TTAB") against Rosenruist to prevent the registration. When Rosenruist refused to appear voluntarily for a Rule 30(b)(6) deposition under the procedural rules promulgated by the Patent and Trademark Office ("PTO"), see 37 C.F.R. § 2.123 (2006), the district court issued a subpoena under 35 U.S.C.A. § 24 directing Rosenruist to produce a designee to testify on behalf of the corporation at a deposition in Virginia. The district court refused Rosenruist's request to quash the subpoena and then subsequently imposed sanctions against Rosenruist when it failed to attend the deposition.

Seeking to ensure Rosenruist's cooperation, VEL filed a motion to compel Rosenruist, on pain of contempt sanctions, to designate its Rule 30(b)(6) representative and appear for the corporate deposition as directed by the subpoena. Notwithstanding its earlier ruling that Rosenruist had been properly served with a valid subpoena for a Rule 30(b)(6) deposition, the court determined that it could not require Rosenruist to produce a corporate designee for the deposition unless that designee personally resided within the district of the issuing court. Because there are no individuals residing within the Eastern District of Virginia who Rosenruist could designate as its witness under Rule 30(b)(6), the court denied VEL's request to compel an appearance.

VEL appeals this ruling. For the reasons that follow, we reverse.

I.

Rosenruist filed an application in December 2002 with the PTO to register the mark VIRGIN GORDA under section 1(b) of the Lanham Act. See 15 U.S.C.A. § 1051(b) (West Supp.2007). At the time, Rosenruist had not sold any products in the United States or established a business presence here. Section 1(b) of the Act permits an applicant to seek trademark registration based on the applicant's intent to use the trademark in commerce rather than the actual use of the mark, provided that the applicant later files "a verified statement that the mark is in use in commerce." See 15 U.S.C.A. § 1051(d)(1) (West Supp.2007).¹

Rosenruist applied to register based on its intent to use the mark VIRGIN GORDA in connection with forty-one categories of goods, including "[b]ags, purses, ... traveling bags, trunks, make-up bags and empty vanity cases, document holders, umbrellas, [and] handbags," as well as various kinds of clothing and footwear. J.A. 46. In its application with the PTO, Rosenruist appointed various members of the Virginia-based law firm prosecuting the application as "domestic representatives" under 15 U.S.C.A. § 1051(e) to act as Rosenruist's designees "upon whom notices or process in proceedings affecting this mark may be served." J.A. 52.

Initially, the PTO's examining attorney refused registration on the basis that the VIRGIN GORDA mark is "primarily geographically deceptively misdescriptive," 15 U.S.C.A. § 1052(e)(3) (West Supp.2007), explaining that Virgin Gorda is an island located within the British Virgin Islands and that its proposed use would cause the public to mistakenly believe that Rosenruist's goods bearing this mark came from the Virgin Islands. Ultimately, however, the examining attorney agreed with Rosenruist that there was insufficient basis for believing that the misdescription would be a material factor in the consuming public's purchasing decisions, withdrew the refusal to register, and caused the PTO to publish the mark in its Official Gazette. See 15 U.S.C.A. § 1062(a) (West Supp. 2007).

In July 2004, VEL filed a Notice of Opposition with the PTO. See 15 U.S.C.A. § 1063(a) (West Supp.2007). VEL has a substantial presence in the United States through a vast array of businesses such as Virgin Atlantic Airways, Virgin Records, Virgin Mobile, Virgin Wines, and Virgin Digital. The VEL conglomerate and its related companies sell and distribute a wide variety of goods and services under the registered VIRGIN mark, including clothing, cosmetics, luggage, bags, wallets, umbrellas, records and CDs, telecommunications products, airline and travel-related services, and restaurant and hotel services. VEL asserted that it would be damaged by the proposed VIRGIN GORDA registration because it is confusingly similar to VEL's VIRGIN mark. Under the trademark practice rules adopted by the PTO, VEL conducted limited discovery through written questions, but it did not seek to conduct a discovery deposition prior to the expiration of the discovery period. See 37 C.F.R. § 2.120(a).

In December 2005, VEL, pursuant to Rule 30(b)(6) of the Federal Rules of Civil Procedure, sought to conduct a testimonial deposition of Rosenruist to present in evidence at trial before the TTAB.² When Rosenruist refused to appear voluntarily in the United States for an oral deposition, VEL moved pursuant to the PTO's rules of procedure to compel Rosenruist to identify a Rule 30(b)(6) representative and produce that person to testify for the corporation at an oral deposition in Portugal. See 37 C.F.R. § 2.123(a)(2) (2006). The TTAB denied VEL's motion to compel, noting that, according to its manual of procedure, a party residing in a foreign country may be compelled to appear for an oral testimonial deposition only through the procedures provided in The Hague Convention or the issuance of letters rogatory to the appropriate Portuguese legal authority. See Trademark Trial and Appeal Board Manual of Procedure ("TBMP") §§ 703.01(a), (f)(3) (2d ed.2003).

In January 2006, VEL served Thomas Perkins — one of the lawyers designated by Rosenruist as its representative under § 1051(e) — with a Rule 30(b)(6) deposition subpoena directing the Rosenruist corporation to appear in McLean, Virginia, and produce the "person having [the] most knowledge" regarding, among other topics, "[t]he factual representations made in [Rosenruist's trademark] Application." J.A. 140, 142.

The subpoena was issued by the district court for the Eastern District of Virginia pursuant to 35 U.S.C.A. § 24, which provides in pertinent part:

The clerk of any United States court for the district wherein testimony is to be taken for use in any contested case in the [PTO], shall, upon the application of any party thereto, issue a subpoena for any witness residing or being within such district, commanding him to appear and testify before an officer in such district authorized to take depositions and affidavits, at the time and place stated in the subpoena. The provisions of the Federal Rules of Civil Procedure relating to the attendance of witnesses ... shall apply to contested cases in the [PTO].

35 U.S.C.A. § 24 (West 2001).

Rosenruist moved pursuant to Rule 45(c)(3)(A) to quash the subpoena, see Fed. R.Civ.P. 45(c)(3)(A), arguing that the district court lacked the authority to subpoena a foreign resident to appear in the United States for a deposition, that VEL was attempting to circumvent the proper procedure for compelling Rosenruist's testimonial deposition as outlined by the TTAB in its order denying VEL's initial motion to compel, and that service of the subpoena on counsel for Rosenruist was ineffective even if the subpoena was valid.

The magistrate judge concluded that the subpoena was properly issued and valid under 35 U.S.C.A. § 24 and rejected Rosenruist's argument that § 24 did not give the district court subpoena power over non-resident foreign corporations. The magistrate judge also concluded that service of the subpoena on counsel for Rosenruist was effective because Rosenruist, in conjunction with its registration application, had designated counsel to accept service of "notices or process in proceedings affecting the mark." 15 U.S.C.A. § 1051(e) (West Supp.2007). Accordingly, on March 2, 2006, the magistrate judge entered an order denying Rosenruist's motion to quash and directing Rosenruist "to designate a Rule 30(b)(6) witness residing or being within this judicial district to appear for deposition by March 15, 2006." J.A. 185. Rosenruist filed objections to the order of the magistrate judge, see Fed. R.Civ.P. 72(a), arguing primarily that the district court lacked the authority to issue a subpoena to non-resident aliens. The district court denied Rosenruist's objections, finding that the decision of the magistrate judge was not contrary to law and did not rest on clearly erroneous factual findings. Rosenruist did not appeal the order denying its motion to quash.

Following the court's denial of Rosenruist's motion to quash, VEL re-served the subpoena and rescheduled the deposition. Rosenruist, however, refused to produce a Rule 30(b)(6)...