Zheng Cai v. Diamond Hong, Inc.

• Decision Date: 27 August 2018
• Docket Number: 2018-1688
• Citation: 901 F.3d 1367
• Parties: ZHENG CAI, DBA Tai Chi Green Tea Inc., Appellant v. DIAMOND HONG, INC., Appellee
• Court: U.S. Court of Appeals — Federal Circuit

901 F.3d 1367

ZHENG CAI, DBA Tai Chi Green Tea Inc., Appellant

v.DIAMOND HONG, INC., Appellee

2018-1688

United States Court of Appeals, Federal Circuit.

Decided: August 27, 2018

Zheng Cai, Vernon Hills, IL, pro se.

Jonathan E. Moskin, Foley & Lardner LLP, New York, NY, for appellee. Also represented by Diane Grace Elder, Chicago, IL.

Before Prost, Chief Judge, Wallach and Hughes, Circuit Judges.

Wallach, Circuit Judge.

Appellant Zheng Cai DBA Tai Chi Green Tea Inc. ("Mr. Cai") appeals an opinion of the U.S. Patent and Trademark Office's ("USPTO") Trademark Trial and Appeal Board ("TTAB") cancelling registration of his mark "WU DANG TAI CHI GREEN TEA" due to a likelihood of confusion with Appellee Diamond Hong, Inc.'s ("Diamond Hong") registered mark, "TAI CHI," pursuant to 15 U.S.C. § 1052(d) (2012). See Diamond Hong, Inc. v. Zheng Cai , Cancellation No. 92062714, 2018 WL 916315, at *5–8 (T.T.A.B. Feb. 14, 2018) ; see also 15 U.S.C. § 1052(d) (providing a mark may not be placed on the principal register if it so resembles a mark already registered "as to be likely ... to cause confusion"). We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(4)(B) (2012). We affirm.

DISCUSSION

Diamond Hong petitioned for cancellation of Mr. Cai's mark based on a likelihood of confusion with its registered TAI CHI mark. See Appellee's Suppl. App. 23. The TTAB found likelihood of confusion, giving limited consideration to Mr. Cai's briefing because it "contraven[ed]" certain provisions of the Trademark Trial and Appeal Board Manual of Procedure ("TBMP"). Diamond Hong , 2018 WL 916315, at *3, *5–7.¹

Mr. Cai appeals the TTAB's evidentiary ruling excluding evidence in his main brief, and its finding of likelihood of confusion. See Appellant's Br. 2–3. We address each argument in turn.

I. The TTAB's Evidentiary Ruling

A. Standard of Review

We review TTAB evidentiary rulings for abuse of discretion. Coach Servs., Inc. v. Triumph Learning LLC , 668 F.3d 1356, 1363 (Fed. Cir. 2012). "We will reverse only if the [TTAB]'s evidentiary ruling was: (1) clearly unreasonable, arbitrary, or fanciful; (2) based on an erroneous conclusion of law; (3) premised on clearly erroneous findings of fact; or (4) the record contains no evidence on which the [TTAB] could rationally base its decision." Id. (internal quotation marks, brackets, and citation omitted).

B. The TTAB Did Not Abuse Its Discretion in Excluding Mr. Cai's Evidence

The TTAB considered the arguments presented in Mr. Cai's Main Brief but did not "consider[ ] the factual assertions and ‘figures’ displayed and discussed in [Mr. Cai's] brief, which are not evidence introduced into the trial record." Diamond Hong , 2018 WL 916315, at *3 ; see Appellee's Suppl. App. 69-75 (Mr. Cai's Main Brief); see also 37 C.F.R. §§ 2.126(a)(1), 2.128(b) (2016) (setting forth rules for submission of briefs to the TTAB). The TTAB also did not consider Mr. Cai's reply brief because the TBMP does not provide for such filings and gives the TTAB broad discretion in considering them. Diamond Hong , 2018 WL 916315, at *3 (citing TBMP § 801.02(d) (June 2017) ("There is no provision for filing a reply brief, rebuttal brief, rejoinder brief, etc. by a party in the position of defendant. If a party in the position of defendant files such a brief, it may be stricken, or given no consideration, by the [TTAB].") ). The TTAB therefore stated that Mr. Cai "introduced no evidence." Id.

Mr. Cai contends that the TTAB improperly excluded evidence submitted in his briefs. Appellant's Br. 2–3. We disagree.

Although the procedural guidelines in the TBMP do not have the force of law, see TBMP Introduction (explaining that "[t]he manual does not modify, amend, or serve as a substitute for any existing statutes, rules, or decisional law and is not binding upon the [TTAB or] its reviewing tribunals"), the TBMP is accorded a degree of deference to the extent that it has the "power to persuade," Christensen v. Harris Cty. , 529 U.S. 576, 587, 120 S.Ct. 1655, 146 L.Ed.2d 621 (2000) (internal quotation marks and citation omitted); see id. (describing agency manuals as documents that "lack the force of law," but are still "entitled to respect" (internal quotation marks and citation omitted) ). Indeed, we have affirmed the TTAB's determinations, specifically with regard to evidence admission, where they are clearly in line with the language of the TBMP. See, e.g. , Bishop v. Flournoy , 319 F. App'x 897, 899–900 (Fed. Cir. 2009) (agreeing with the TTAB that it was not required to consider certain evidence based on TBMP guidelines); In re DSS Envtl., Inc. , 113 F. App'x 902, 907 (Fed. Cir. 2004) (similar); see also Am. Rice, Inc. v. Dunmore Props. S.A. , 353 F. App'x 428, 432 (Fed. Cir. 2009) (affirming a TTAB determination based on the TBMP concerning denial of a motion for time to conduct discovery).

The TTAB did not abuse its discretion in determining that Mr. Cai submitted no evidence. With respect to Mr. Cai's Main Brief, the TBMP provides that evidentiary matters are resolved in accordance with the "Federal Rules of Evidence, the relevant portions of the Federal Rules of Civil Procedure, the relevant provisions of Title 28 of the United States Code, and the rules of practice in trademark cases (i.e., the provisions of Part 2 of Title 37 of the Code of Federal Regulations)." TBMP § 702.02. Mr. Cai's Main Brief contains numerous assertions of fact. See, e.g. , Appellee's Suppl. App. 71 ("Our Green Tea is so Unique in the US Market that no Any [sic] Other Green Tea is Comparable to Ours."). This information is not evidence under any of the relevant rules, as the TTAB recognized. See Diamond Hong , 2018 WL 916315, at *3 (citing Enzo Biochem, Inc. v. Gen-Probe Inc. , 424 F.3d 1276, 1284 (Fed. Cir. 2005) ("Attorney argument is no substitute for evidence.") ).

With respect to his Reply Brief, the plain language of the TBMP states that the TTAB is not required to permit "a party in the position of defendant" to file a reply brief. TBMP § 801.02(d); see Odom's Tenn. Pride Sausage, Inc. v. FF Acquisition, L.L.C. , 600 F.3d 1343, 1346 (Fed. Cir. 2010) (stating that we give the TTAB significant latitude in applying the TBMP when the language therein is "permissive"). Because Diamond Hong initiated the cancellation proceedings by filing a petition, see Appellee's Suppl. App. 23, Mr. Cai was in the position of a defendant, and was therefore not entitled to file a reply brief, see TBMP § 801.02(d). Accordingly, the TTAB did not abuse its discretion in applying the TBMP and excluding Mr. Cai's submissions.

II. Likelihood of Confusion

A. Standard of Review and Legal Standard

We review the TTAB's legal conclusions de novo and its findings of fact for substantial evidence. In re N.C. Lottery , 866 F.3d 1363, 1366 (Fed. Cir. 2017). "Substantial evidence is ‘such relevant evidence as a reasonable mind would accept as adequate to support a conclusion.’ " Stone Lion Capital Partners, L.P. v. Lion Capital LLP , 746 F.3d 1317, 1321 (Fed. Cir. 2014) (quoting Consol. Edison Co. of N.Y. v. N.L.R.B. , 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938) ). "Where two different conclusions may be warranted based on the evidence of record, the [TTAB]'s decision to favour one conclusion over the other is the type of decision that must be sustained by this court as supported by substantial evidence." In re Bayer Aktiengesellschaft , 488 F.3d 960, 970 (Fed. Cir. 2007) (citation omitted).

Section 1052(d) provides that a trademark may be refused if it

[c]onsists of or comprises a mark which so resembles a mark registered in the [USPTO], or a mark or trade name previously used in the United States by another and not abandoned, as to be likely, when used on or in connection with the goods of the applicant, to cause confusion , or to cause mistake, or to deceive.

15 U.S.C. § 1052(d) (emphasis added). In Application of E.I. DuPont DeNemours & Co. , our predecessor court articulated thirteen factors to consider when determining likelihood of confusion (" DuPont factors"). See 476 F.2d 1357, 1361 (CCPA 1973).²

"Not all of the DuPont factors are relevant to every case, and only factors of significance to the particular mark need be considered." In re Mighty Leaf Tea , 601 F.3d 1342, 1346 (Fed. Cir. 2010) (citation omitted). "Likelihood of confusion is a question of law with underlying factual findings made pursuant to the DuPont factors." Stone Lion Capital Partners , 746 F.3d at 1321 (citation omitted); see Herbko Int'l, Inc. v. Kappa Books, Inc. , 308 F.3d 1156, 1165 (Fed. Cir. 2002) ("[A] showing of actual confusion is not necessary to establish a likelihood of confusion." (citation omitted) ). "This court reviews the [TTAB]'s factual findings on each DuPont factor for substantial evidence, and its legal conclusion of likelihood of confusion de novo." Stone Lion Capital Partners , 746 F.3d at 1321 (citations omitted).

B. The TTAB Did Not Err in Finding Likelihood of Confusion Between the Two Marks

In its likelihood of confusion analysis, the TTAB considered the first three DuPont factors, treating the rest as neutral because neither party submitted evidence related to them. Diamond Hong , 2018 WL 916315, at *5–8 (considering similarity of the marks, similarity and nature of goods described in the marks' registrations, and similarity of trade channels). Mr. Cai argues the TTAB improperly weighed these three DuPont factors to arrive at an incorrect conclusion regarding likelihood of confusion. See Appellant's Br. 11–19. We disagree with Mr. Cai.

Substantial evidence supports the TTAB's findings with respect to each DuPont factor, and the TTAB did not err as to its ultimate conclusion of likelihood of confusion. We analyze the factors in the same order as the TTAB: similarity of the nature of the goods, similarity of established trade channels, and similarity of the marks. See Diamond Hong , 2018 WL 916315, at *5–8. With respect to the similarity and nature of the goods, the goods...