noting that 18 a reconsideration motion “may not be used to raise arguments or present evidence for the 19 first time when they could reasonably have been raised earlier”
How later courts described this case
- noting that 18 a reconsideration motion “may not be used to raise arguments or present evidence for the 19 first time when they could reasonably have been raised earlier”
Written by the judges who cited it.
The opinion
1 UNITED STATES DISTRICT COURT
2 SOUTHERN DISTRICT OF CALIFORNIA
3 RESIDENTIAL ENERGY SERVICES Case No.: 22-cv-1641-AGS-MSB
NETWORK, INC.,
4
ORDER DENYING
Plaintiff,
5 RECONSIDERATION (ECF 81)
v.
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BUILDING SCIENCE INSTITUTE,
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LTD. CO., et al.,
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Defendants.
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This Court preliminarily enjoined defendant Building Science Institute, Ltd. Co.
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(BSI), from improperly using “HERS” to describe a Home Energy Rating System, as such
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use likely infringed on plaintiff’s trademark. BSI moves for reconsideration.
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DISCUSSION
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“Reconsideration is appropriate if the district court (1) is presented with newly
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discovered evidence, (2) committed clear error or the initial decision was manifestly unjust,
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or (3) if there is an intervening change in controlling law.” School Dist. No. 1J, Multnomah
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Cnty., Or. v. ACandS, Inc., 5 F.3d 1255, 1263 (9th Cir. 1993). BSI primarily argues that it
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has presented “newly discovered evidence” and “legal decisions” that “came into existence
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after the injunction issued,” while interspersing arguments about the Court’s supposed
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misunderstandings. (See ECF 93, at 2.) BSI only asks the Court to reconsider the
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“likelihood of success” prong of its preliminary-injunction order. (ECF 81-1, at 8.)
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A. Newly Discovered Evidence
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23 BSI’s purported “newly discovered evidence” is not “new” by reconsideration-
24 motion standards. A party moving for reconsideration on this ground must “show not only
25 that this evidence was newly discovered or unknown to it until after the hearing, but also
26 that it could not with reasonable diligence have discovered and produced such evidence at
27 the hearing.” Frederick S. Wyle Pro. Corp. v. Texaco, Inc., 764 F.2d 604, 609 (9th Cir.
28 1985).
1 BSI presents four items of additional evidence that existed well before this litigation
2 began:
3 1. The United States Patent and Trademark Office’s “files on Plaintiff’s two
additional contemporaneously filed trademark applications which were rejected
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by the USPTO,”
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2. “Plaintiff’s attorney’s trademark application prosecution files for the marks
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HERS®, HERS, and HERS/HOME ENERGY RATING SYSTEM[],”
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3. California Energy Commission documents “regarding the Settlement Agreement
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entered into between Plaintiff and the CEC,” and
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4. Portions of “Plaintiff’s trademark attorney’s files regarding the intended scope of
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the Settlement Agreement with CEC.”
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(ECF 93, at 4.) But BSI had plenty of time to uncover this material during the nine weeks
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between the filing of the preliminary-injunction motion and the hearing on it. (See ECF 18;
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ECF 27). BSI has the burden of explaining why a reasonably diligent attorney could not
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have found these items in the months before the hearing—let alone in the nearly two years
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between the preliminary injunction’s issuance and BSI’s belated motion for
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reconsideration. (See ECF 28; ECF 81.) It has not met that burden. See Wells Fargo Bank,
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N.A. v. Mahogany Meadows Ave. Trust, 979 F.3d 1209, 1218 (9th Cir. 2020) (noting that
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a reconsideration motion “may not be used to raise arguments or present evidence for the
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first time when they could reasonably have been raised earlier”).
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B. New Law
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Next, BSI asserts that “new law” demands a different result. But the main case it
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relies on—Great Concepts, LLC v. Chutter, Inc., 90 F.4th 1333 (Fed. Cir. 2024)—makes
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BSI’s burden of challenging this trademark more difficult, not less. (See ECF 81-1, at 9–13;
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ECF 93, at 4–7.) At the time of the preliminary-injunction hearing, the Ninth Circuit had
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long held that “filing a fraudulent incontestability affidavit [alone] provides a basis for
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canceling the registration itself.” Robi v. Five Platters, Inc., 918 F.2d 1439, 1444 (9th Cir.
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1990) (cleaned up). Chutter rejected that notion and adopted a more demanding process
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1 for litigants, like BSI, who dispute a trademark. The court held that a trademark
2 “registration” may not be cancelled in its entirety solely due to “fraud in connection with
3 acquiring incontestable status,” but that such fraud is merely a basis for cancelling the
4 “incontestable status.” Chutter, 90 F.4th at 1340. After Chutter, BSI must first establish
5 that the mark’s “incontestability status” was “obtained fraudulently,” warranting
6 cancellation of its incontestability, and only then may it challenge the HERS mark’s
7 registration. See id. at 1337, 1339. It’s unclear why this more rigorous legal framework
8 mandates reconsideration of this Court’s prior ruling.
9 Regardless, BSI’s new argument that RESNET engaged in fraud during the
10 incontestability process is substantively unavailing as well. In light of the “Settlement
11 Agreement and two abandoned trademark applications,” BSI insists that the RESNET
12 representative who filed for trademark incontestability committed fraud by declaring that
13 “no final decision adverse to the owner’s claim of ownership of such mark for those
14 goods/services, or to indicate membership in the collective membership organization,
15 exists, or to the owner’s right to register the same or to keep the same on the register; and,
16 no proceeding involving said rights pending and not disposed of in either the U.S. Patent
17 and Trademark Office or the courts exists.” (ECF 81-6, at 46–47; see ECF 81-1, at 12.)
18 But BSI presents no authority that a settlement agreement is a “final decision adverse
19 to the owner’s claim of ownership,” a “final decision adverse to” “the owner’s right to
20 register,” or a “pending” “proceeding involving said rights.” (See ECF 81-6, at 46.) Nor
21 does BSI offer any authority that a previously abandoned trademark application would
22 qualify under those categories. (Id.; cf. ECF 81-5, at 4 (showing that the USPTO refers to
23 the process as a “NOTICE OF ABANDONMENT”).) Despite BSI’s argument to the
24 contrary, our case is far different than Chutter. The Chutter representative signed the
25 incontestability declaration while there were two “pending” actions that challenged the
26 mark’s validity—a “cancellation proceeding in the PTO and [an] Eleventh Circuit appeal.”
27 90 F.4th at 1335–36. BSI has presented no evidence of any “pending” challenges to the
28 registered trademark when the RESNET representative made the foregoing declaration in
1 August 2013. (See ECF 81-6, at 46.) So, BSI’s fraud-during-incontestability argument
2 fails.
3 BSI gestures at two other cases that don’t move the needle either. First, OpenAI, Inc.
4 v. Open A.I., Inc., 719 F. Supp. 3d 1033 (N.D. Cal. 2024), aff’d, No. 24-1963, 2024 WL
5 4763687 (9th Cir. Nov. 13, 2024), is a trial-court opinion that is not binding on this Court.
6 It cannot qualify as “an intervening change in controlling law.” See ACandS, Inc., 5 F.3d
7 at 1263. And the affirmance of that case on appeal doesn’t help BSI, because the Ninth
8 Circuit never mentioned the specific issue—prior rejections of trademark applications—
9 that BSI focuses on.
10 Second, BSI points to Heritage Alliance v. American Policy Roundtable, 133 F.4th
11 1063 (Fed. Cir. 2025), which held that the Trademark Trial and Appeal Board “has
12 discretion not to accept” “five-plus years of prior continuous use as ‘prima facie evidence’
13 that the marks had acquired distinctiveness.” Id. at 1070. But that principle was already
14 clear from the statute, which states that the Board “‘may accept’ such proof ‘as prima facie
15 evidence that the mark has become distinctive.’” Id. (quoting 15 U.S.C. § 1052(f) with
16 emphasis added in the opinion). And, as the Heritage Alliance court itself noted, “our case
17 law similarly recognizes the Board’s discretion to weigh the evidence” and to reject such
18 prima facie evidence. Id. (collecting cases). Heritage Alliance is not an intervening change
19 in controlling law.
20 C. Clear Error
21 Finally, BSI asserts that “the Court committed error in relying on Plaintiff’s
22 representation of the Settlement Agreement with the [California Energy Commission] as
23 being a license agreement.” (ECF 81-1, at 14.) This is so, says BSI, because RESNET
24 “misrepresented the significance of the Settlement Agreement between Plaintiff and the
25 CEC” and “the Court apparently accepted” that misrepresentation “as true.” (Id. at 13.)
26 “To be clearly erroneous, a decision must strike [the Court] as more than just maybe
27 or probably wrong; it must be dead wrong.” United States v. Hollis, 506 F.3d 415, 421
28 (5th Cir. 2007). But the Court well understood the agreement’s import. In fact, after
1 || discussing the agreement during oral argument, the Court re-reviewed the document during
2 ||arecess and later expanded upon the agreement-related analysis when issuing a final ruling
3 the hearing’s end. (See ECF 29, at 32, 38, 46.) Even if the Court’s description of the
4 ||agreement as “akin to a license” was imprecise (ECF 29, at 46), as BSI contends, the
5 ||essential facts of that agreement—and the Court’s understanding of its terms—has not
6 ||changed. BSI has not met its burden to establish that the Court was “dead wrong” about
7 ||the agreement. See Hollis, 506 F.3d at 421.
8 CONCLUSION
9 BSI’s reconsideration motion is DENIED. The unopposed judicial-notice motion is
10 || granted. (See ECF 81-3.)
11 Dated: November 21, 2025
13 Hon. Andrew G. Schopler
14 United States District Judge
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