The opinion
IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
SOUTHERN DIVISION
O’REILLY AUTOMOTIVE STORES, INC., )
)
Plaintiff, )
)
v. ) No. 16-3102-CV-S-BP
)
BEARING TECHNOLOGIES, LTD., )
)
Defendant. )
ORDER AND OPINION GRANTING IN PART AND DEFERRING IN PART
DEFENDANT’S MOTION TO DISMISS FOR LACK OF JURISDICTION
O’Reilly Automotive Stores, Inc., (“Plaintiff”), filed suit against Bearing Technologies,
Limited, (“Defendant”), asserting claims under the Lanham Act and similar state laws. Defendant
responded with similar counterclaims. In two separate Orders the Court granted summary
judgment on many of the parties’ claims. (Doc. 411, Doc. 429.) Defendant then filed a Motion to
Dismiss, contending that in light of the Court’s rulings, it lacks jurisdiction over the remaining
claims. Plaintiff opposes dismissal. Upon considering the parties’ arguments, the Court grants
the motion in part and defers it in part.
I. BACKGROUND
The Court’s prior Orders provide greater detail about the background to this case. (See
Doc. 411, pp. 1-4; Doc. 429, pp. 1-6.) In summary, this lawsuit involves the use of the word
“Precision” to describe certain auto parts, as well as the use of particular marks or logos using that
word. Both parties claim the right to use of the word. Since at least February 2008 (and possibly
earlier), Defendant has utilized a black and red mark with the word “Precision” on wheel hub
assemblies. In February 2008, Defendant had acquired this (or a similar) mark from North Coast
Bearings, Inc., which had used the mark since at least June 2006. Defendant may have acquired
other “Precision” marks from North Coast as well, some of which had been used as early as 1992.
However, none of these marks had been registered with the Patent and Trademark Office, (“the
PTO”), by either North Coast or Defendant.
In 1965, Precision Universal Joint Corporation registered a trademark in the word
“Precision” in connection with universal joints (or “u-joints”). Its use of the word in its trademark
appeared in blue and yellow and in a font different from North Coast’s and Defendant’s use of the
word. At some point in time, Federal-Mogul acquired this trademark and continued using it to
brand its u-joints. In 2010, Federal-Mogul decided to phase out its Precision brand and offered to
sell it to Plaintiff. Plaintiff expressed interest, but only if the trademark could be extended to wheel
hub assemblies. Accordingly, in March 2010, Federal-Mogul applied with the PTO for registration
of the word marks “Precision” and “Precision Hub Assemblies” for use in connection with the sale
of wheel hub assemblies. In June 2010, Plaintiff began selling Precision-branded wheel hubs using
the yellow and blue logo under a license with Federal-Mogul. In May 2011, the PTO granted
Federal-Mogul’s applications and issued registrations for the word “Precision” and the phrase
“Precision Hub Assemblies,” both in conjunction with wheel hub assemblies. In November 2011,
Federal-Mogul assigned the trademarks to Plaintiff.
Meanwhile, by the end of 2010 Defendant was aware that Plaintiff was selling Precision-
branded wheel hubs using the yellow and blue logo. Discussions between Plaintiff and Defendant
commenced, and continued over the course of years. Topics discussed included the parties’ rights
to use their respective marks, the possibilities for an agreement regarding their respective rights,
and the possibilities for a business relationship; however, a formal agreement was never reached.
In December 2015, Defendant filed its own application for a registration. It also filed a
Petition for Cancellation with the Trademark Trial and Appeal Board, (“TTAB”), thereby initiating
a process of inter partes review of the registrations issued to Federal-Mogul and now owned by
Plaintiff. In its Petition for Cancellation, Defendant claimed to have a common law trademark that
predated Federal-Mogul’s application, and that Plaintiff’s registration constituted a “cloud” on its
own application for registration. (Doc. 257-4, pp. 4-6.) Plaintiff filed this lawsuit in March 2016,
then asked the TTAB to stay its proceedings until the suit was concluded. Among the grounds for
the requested stay was Plaintiff’s argument that the lawsuit “involves the same issues which would
be resolved” by the TTAB, “namely whether [Plaintiff’s registrations] should be cancelled . . .
because of Defendant’s alleged prior rights, and the determination . . . by the District Court will
very likely be completely dispositive of the issues involved in this proceeding.”1 The TTAB
granted Plaintiff’s request and stayed its proceedings.
The parties presented several claims and counterclaims. Specifically, Plaintiff’s Amended
Complaint, (Doc. 73), asserts eight counts:
I. Trademark Infringement under Federal Law, alleging that Defendant has infringed on
Plaintiff’s registered mark
II. False Designation of Origin under Federal Law
III. Unfair Competition under Federal Law
IV. Trademark Infringement under Missouri Law
V. Unfair Competition under Missouri Law
VI. Violation of Missouri’s Anti-Dilution Statute
VII. A request for a Declaratory Judgment declaring that (a) Defendant does not have a common
law trademark, (b) Defendant’s Petition for Cancellation filed with the TTAB is void, and
(c) Defendant’s 2015 application to register a trademark is void.
1 http://ttabvue.uspto.gov/ttabvue/v?pno=92062906&pty=CAN&eno=8 (last visited October 2, 2018).
VIII. An alternative claim for Trademark Infringement under Federal Law, alleging that even if
Plaintiff’s registered mark is invalid it has a common law mark, and Defendant has
infringed on Plaintiff’s common law mark
Defendant’s Amended Answer, (Doc. 335), includes eight counterclaims:
I. False Designation of Origin under Federal Law
II. Unfair Competition under Federal Law
III. A request for a Declaratory Judgment declaring that Defendant’s mark does not infringe
on Plaintiff’s mark
IV. A request to cancel Plaintiff’s Trademark, based on Defendant’s prior common law
trademark.
V. Unfair Competition under Missouri Law
VI. Unfair Competition under Ohio Law
VII. Deceptive Trade Practices under Ohio Law
VIII. A request to cancel Plaintiff’s registered trademark, based on allegations that Plaintiff
committed fraud on the PTO.
The Court granted summary judgment on all damage-seeking claims, leaving for resolution (1)
Plaintiff’s Count VII and (2) Defendant’s Counterclaim IV. However, the Court did not address
Plaintiff’s arguments for summary judgment on Counterclaim IV, stating that it would “address
that counterclaim, if necessary, after the mediation.” (Doc. 429, p. 6 n.4.)
II. DISCUSSION
As stated earlier, Defendant contends that the Court’s rulings deprive it of jurisdiction over
the remaining claims. First, Defendant argues that absent a claim by either party alleging
infringement or otherwise seeking damages, Plaintiff lacks standing to seek a declaration that
Defendant does not have a common law mark. Alternatively, Defendant argues that Plaintiff’s
request for such a declaration is moot in light of the Court’s rulings. Second, Defendant argues
that the Court lacks jurisdiction over Counterclaim IV (although, Defendant does not actually
dismiss its own counterclaim). Plaintiff responds that it has standing to seek a declaration that
Defendant does not have a common law mark and its request is not moot. Plaintiff does not
specifically respond to Defendant’s argument that the Court lacks jurisdiction over Counterclaim
IV.
A. Plaintiff’s Count VII
1. Jurisdiction
Defendant’s arguments about standing and mootness with respect to Count VII are related,
both factually and legally. It points to the Court’s prior ruling that neither party could present
evidence of actual or likely confusion. Relying on that decision, Defendant argues that Plaintiff
lacks an injury or potential injury due to Defendant’s assertion of a common law mark, so Plaintiff
lacks standing to seek the declaration. For the same reasons, Defendant argues that the Court’s
ruling renders any claim that Plaintiff might have had moot. The Court concludes that it lacks
sufficient information to resolve this issue.2
Article III of the Constitution limits federal courts to resolving cases and controversies,
and “[s]tanding to sue is a doctrine rooted in the traditional understanding of a case or
controversy.” Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016). To demonstrate standing,
“[t]he plaintiff must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged
conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.”
Id. A case becomes moot – and therefore no longer a ‘Case’ or ‘Controversy’ for purposes of
2 The Court rejects Plaintiff’s suggestion that it still has jurisdiction merely because there are fully briefed issues that
the Court has not resolved, (Doc. 448, pp. 3-4), because there is no law to support this theory and the argument is
counter to the notion of jurisdiction. Similarly, the Court does not agree that the supplemental jurisdiction statute, 28
U.S.C. § 1367, provides a basis for the Court to exercise its discretion to retain jurisdiction over an issue where
standing (and, hence, a case or controversy) is absent. Section 1367 applies to claims that are part of an already-
existing case or controversy, Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 558 (2005), and thus
presupposes the existence of a case or controversy. Nothing in its language allows a court to resolve legal issues when
a case or controversy is absent.
Article III – when the issues presented are no longer ‘live’ or the parties lack a legally cognizable
interest in the outcome.” Already, LLC v. Nike, Inc., 568 U.S. 85, 91 (2013). “Mootness is akin
to the doctrine of standing because the requisite personal interest that must exist at the
commencement of the litigation (standing) must continue throughout its existence (mootness).”
Phelps-Roper v. City of Manchester, 697 F.3d 678, 687 (8th Cir. 2012) (en banc) (quotation
omitted). Defendant does not dispute that when this case started Plaintiff had standing; that is, that
Plaintiff had the necessary injury (or potential injury) to seek a declaration that Defendant did not
have a common law mark. But, it invokes both standing and mootness to argue that (1) any such
injury ceased to exist when the Court ruled that there was no evidence in the Record of confusion
or a likelihood of confusion and (2) Plaintiff’s request for a declaration is moot because such a
declaration will not affect the parties’ relationship or rights with respect to each other.
The Declaratory Judgment Act, 28 U.S.C. § 2201, does not serve as an independent basis
for jurisdiction. Instead, it allows a court to “declare the rights and other legal relations of any
interested party seeking such declaration” if presented “a case of actual controversy within its
jurisdiction . . . .” 28 U.S.C. § 2201(a). “[T]he phrase ‘case of actual controversy’ in the Act
refers to the types of ‘Cases’ and ‘Controversies’ that are justiciable under Article III.”
MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 130 (2007). To satisfy this requirement, “there
must exist a substantial controversy between the parties having adverse legal interests, of sufficient
immediacy and reality to warrant the issuance of a declaratory judgment. A live dispute must exist
between the parties at the time of the court’s hearing.” Gopher Oil Co. v. Bunker, 84 F.3d 1047,
1050 (8th Cir. 1996) (quotations and citations omitted); see also MedImmune, Inc., 549 U.S. at
771.
The standing inquiry is fact-specific. In MedImmune, the Supreme Court conceded that its
cases
do not draw the brightest of lines between those declaratory-judgment actions that
satisfy the case-or-controversy requirement and those that do not. Our decisions
have required that the dispute be “definite and concrete, touching the legal relations
of parties having adverse legal interests”; and that it be “real and substantial” and
“admi[t] of specific relief through a decree of a conclusive character, as
distinguished from an opinion advising what the law would be upon a hypothetical
state of facts.”
MedImmune, 549 U.S. at 127 (quoting Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240-41
(1937)). “Basically, the question in each case is whether the facts alleged, under all the
circumstances, show that there is a substantial controversy, between parties having adverse legal
interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.”
Id. (quotation omitted).
Plaintiff relies primarily on the pending TTAB proceeding to establish the immediacy of
the parties’ controversy, and Defendant contends that the TTAB proceedings are irrelevant to the
inquiry. Defendant’s position appears to be incorrect. “[T]o hold TTAB opposition filings as a
class irrelevant to Article III analysis . . . would disregard the Supreme Court's direction [in
MedImmune] that, in assessing whether a live controversy exists between the parties, we must take
into account all the circumstances” in the case. Surefoot LC v. Sure Foot Corp., 531 F.3d 1236,
1246 (10th Cir. 2008) (Gorsuch, J.). Other courts to address the issue also have not held that the
TTAB proceedings are irrelevant; instead, they have held that something more than a pending
TTAB proceeding is necessary to establish standing. E.g., Hogs and Heroes Foundation Inc. v.
Heroes, Inc., 202 F. Supp. 3d 490 (D. Md. 2016); Vina Casa Tamaya S.A. v. Oakville Hills Cellar,
Inc., 784 F. Supp. 2d 391 (S.D.N.Y. 2011); see also Surefoot, 531 F.3d at 1247 (10th Cir. 2008)
(Gorsuch, J.) (“underscore[ing] that the court was not holding that standing exists where the only
indicia of a live infringement controversy is the existence of a single TTAB opposition
proceeding”); O’Neill v. Jesco Imports, Inc., 2006 WL 2623220 (W.D. Mo. 2006).
Therefore, while the TTAB proceedings are not irrelevant to the inquiry, more is required
in order for standing to exist. Plaintiff relies upon the fact that Count VII remains critical to the
pending TTAB proceedings and cites the Court’s prior observation that the TTAB cannot
determine whether Defendant has a common law mark. (Doc. 448, p. 12 (citing Doc. 429, p. 12).)
Plaintiff’s point is persuasive: If the TTAB cannot determine whether Defendant has a common
law mark, an immediate conflict may exist because (1) this determination would still be necessary
to resolve the pending TTAB proceeding initiated by Defendant but (2) only this Court, and not
the TTAB, could resolve the issue. On the other hand, if the TTAB can make such a determination,
then an immediate conflict (and, hence, standing) may be lacking because the issue can be resolved
in that forum. For its part, Defendant has not discussed whether the TTAB can determine whether
Defendant has a common law mark.
However, the Court requires further discussion of the issue before concluding whether the
TTAB can or cannot determine whether Defendant has a common law mark. In its prior Order,
the Court stated that “the TTAB . . . cannot adjudicate whether Defendant has a common law
mark,” (Doc. 429, p. 12), citing Professor McCarthy’s treatise for support. Professor McCarthy
explains that the TTAB can only determine whether a registration is valid, and while it can cancel
a registration it cannot “invalidate underlying common law rights in the trademark because those
rights do not flow from federal registration.” 3 J. Thomas McCarthy, McCarthy on Trademarks
and Unfair Competition, § 20:1 (5th ed. 2018). This passage states that the TTAB cannot ascertain
whether Plaintiff has a common law mark – which suggests that the TTAB also cannot ascertain
whether Defendant has a common law mark. This would leave this Court as the only forum
capable of addressing an issue that is integral to the TTAB proceeding and thus establish the
immediate dispute necessary to support standing. However, the Court’s prior observation was
made in passing, and was not critical to the matter being analyzed. Now, however, the TTAB’s
powers are critical to the jurisdictional inquiry, and the Court would prefer that its conclusions
about the TTAB’s powers be based on legal authority apart from Professor McCarthy’s treatise.
The Court directs the parties to be prepared to address this issue at the Pretrial Conference.
First, Plaintiff shall explain whether there is in anything other than the TTAB proceedings that it
believes will establish the immediate controversy necessary to support standing. Second, Plaintiff
shall explain whether the TTAB can resolve the issues raised in Count VII and provide legal
authority to support its position. Defendant shall be prepared to respond to these points. If the
parties desire, they may file a brief (not to exceed four pages) written submission on these issues
by noon on October 11, 2018.
2. Discretion Under the Declaratory Judgment Act
Separate and apart from the question of whether the Court has jurisdiction is the question
of whether the Court should exercise it to award purely declaratory relief. The Court is inclined
to believe that it should exercise its discretion to consider awarding declaratory relief if the TTAB
cannot address Defendant’s assertion that it has a common law mark. However, if (1) the TTAB
can resolve the issues but (2) Plaintiff demonstrates that there is something else in addition to the
TTAB proceeding that will give it standing, the Court must consider whether it should entertain
Plaintiff’s request for declaratory relief. “Relief under 28 U.S.C. § 2201, the Federal Declaratory
Judgment Act, is discretionary, and an important factor in exercising that discretion is whether the
declaratory judgment plaintiff has another, more appropriate remedy.” Gulf Underwriters Ins. Co.
v. Burris, 674 F.3d 999, 1004 (8th Cir. 2012) (quotation omitted); see also Roark v. S. Iron R-1
Sch. Dist., 573 F.3d 556, 561-62 (8th Cir. 2009) (quotation omitted).
This was the analysis employed by the Tenth Circuit in Surefoot. The Tenth Circuit
concluded that the plaintiff had standing and “that the district court has jurisdiction to entertain
this case, [but] the question remains, whether, as a discretionary matter, it should do so.” Surefoot,
531 F.3d at 1248. The court then remanded the case for the district court’s consideration of the
issue. Similarly, if the TTAB can address Plaintiff’s claim and the Court concludes that it
nonetheless has jurisdiction, the question remains whether the Court should exercise that
jurisdiction. The parties should also be prepared to address this issue at the pretrial conference.
B. Jurisdiction With Respect to Defendant’s Counterclaim IV
Defendant contends that its own remaining Counterclaim (Counterclaim IV), which seeks
cancellation of Plaintiff’s registration, should be dismissed for lack of jurisdiction. Counterclaim
IV is brought pursuant to 15 U.S.C. § 1119, which provides that “[i]n any action involving a
registered mark the court may determine the right to registration, order the cancelation of
registrations, in whole or in part, and otherwise rectify the register with respect to the registrations
of any party.” 15 U.S.C. § 1119. Defendant contends that a request for cancellation under § 1119
must be accompanied by some other claim involving a registered mark and cannot be a free-
standing claim. (Doc. 442, pp. 10-15.) The Court agrees with Defendant.
The first sentence of § 1119 “specifies that cancellation may only be sought if there is
already an ongoing action that involves a registered mark; it does not indicate that a cancellation
claim is an independent cause of action.” Airs Aromatics, LLC v. Victoria’s Secret Stores Brand
Mgt., Inc., 744 F.3d 595, 599 (9th Cir. 2014). “[A] controversy as to the validity of or interference
with a registered mark must exist before a district court has jurisdiction to grant the cancellation
remedy.” Ditri v. Coldwell Banker Residential Affiliates, Inc., 954 F.2d 869, 873 (3d Cir. 1992);
see also Windsurfing Int’l, Inc. v. AMF Inc., 828 F.2d 755, 758-59 (Fed. Cir. 1987). Here, there
is no remaining claim involving a registered mark – so, the Court lacks the jurisdiction to consider
Defendant’s free-standing claim to cancel Plaintiff’s registration pursuant to § 1119. Counterclaim
IV is dismissed without prejudice.3
III. CONCLUSION
For the reasons stated, the Motion to Dismiss, (Doc. 442), is GRANTED IN PART and
Counterclaim IV is dismissed without prejudice for lack of jurisdiction. The Court defers
consideration of the motion to the extent that it seeks dismissal of Plaintiff’s remaining claim.
IT IS SO ORDERED.
/s/ Beth Phillips
BETH PHILLIPS, JUDGE
DATE: October 9, 2018 UNITED STATES DISTRICT COURT
3 This ruling makes it unnecessary to consider Plaintiff’s arguments that it is entitled to summary judgment on
Counterclaim IV.