Jean Alexander Cosmetics, Inc. v. L'oreal Usa, Inc.

458 F.3d 244 (2006)


Sometime in 1988, D began using the mark 'Shades EQ' and associated design for certain hair care products. In 1990, P began using its 'EQ System' mark and design and, in 1993, it registered this mark with the Patent and Trademark Office (PTO). In 1996, D attempted to register a modernized version of its Shades EQ mark that it had begun using in 1992. The PTO rejected the application for registration because it was likely to be confused with P's. D filed a petition to cancel P's registration for the EQ System mark. P denied that D's marks  had priority over its trademark or that there was a likelihood of confusion between its EQ System mark and D's Shades EQ marks. It also raised the latter claim as an affirmative defense. After four years of proceedings, the TTAB dismissed D's petition to cancel the registration of P's EQ System trademark. It held that the original Shades EQ mark had priority over the EQ System mark, but found that the modernized Shades EQ mark was not a legal equivalent of the original version. D could not establish the priority of its modernized Shades EQ mark over P's EQ System mark. As far as confusion was concerned, the TTAB concluded that there was no likelihood of confusion between P's mark and either the original or modernized versions of D's mark. D reasserted its request with the PTO to register its modernized Shades EQ trademark. Relying on the TTAB's finding, the PTO withdrew its refusal to register D's mark. The modernized Shades EQ mark was approved for publication, which entitled third parties to oppose its registration. P timely filed a notice of opposition to the registration and TTAB held that the likelihood of confusion between the two marks had been fully and decisively litigated in the cancellation proceedings. Thus it held that P was precluded from relitigating likelihood of confusion. The TTAB granted summary judgment in favor of D.  P sued D in the District Court alleging trademark infringement of its EQ System mark and specifically averring likelihood of confusion. The District Court dismissed the complaint, holding that the doctrine of issue preclusion, also known as collateral estoppel, prevented P from relitigating likelihood of confusion and foreclosed its claim for trademark infringement. P appealed.