Stephen Slesinger, Inc. v. Disney Enterprises, Inc.

United States Court of Appeals

for the Federal Circuit

__________________________

STEPHEN SLESINGER, INC.,

Appellant,

v.

DISNEY ENTERPRISES, INC.,

Appellee.

__________________________

2011-1593

(Opposition Nos. 91179064, 91182358, 91183644,

91186026, 91187261, 91188860, 91191230, 91192691,

91194551, 91196019, and 91198046; and

Cancellation No. 92046853)

__________________________

Appeal from the United States Patent and Trademark

Office, Trademark Trial and Appeal Board.

____________________________

Decided: December 21, 2012

____________________________

ROGER L. ZISSU, Fross Zelnick Lehrman & Zussu,

P.C., of New York, New York, argued for appellant. With

him on the brief were DAVID DONAHUE and MICHAEL

CHIAPPETTA. Of counsel was RICHARD Z. LEHV.

DANIEL M. PETROCELLI, O’Melveny & Myers LLP, of

Los Angeles, California, argued for appellee. With him on

SLESINGER v. DISNEY ENTERPRISES 2

the brief were CASSANDRA L. SETO; and MARK E. MILLER,

of San Francisco, California.

__________________________

Before RADER, Chief Judge, O’MALLEY, and REYNA, Cir-

cuit Judges.

Opinion for the court filed by Chief Judge RADER. Dis-

senting opinion filed by Circuit Judge REYNA.

RADER, Chief Judge.

The Trademark Trial and Appeal Board (“Board”)

dismissed with prejudice Stephen Slesinger, Inc.’s

(“Slesinger” or “SSI”) challenge to the trademark rights

related to A.A. Milne’s literary work featuring Winnie-

the-Pooh and other characters owned by Disney Enter-

prises, Inc. (“Disney”). During the course of the parties’

dispute, Slesinger filed twelve opposition and cancellation

proceedings with the Board consolidated under Stephen

Slesinger, Inc. v. Disney Enter., Inc., 98 U.S.P.Q.2d 1890

(T.T.A.B. 2011) (the “Consolidated Proceedings”). Because

the Board properly barred Slesinger’s proceeding, granted

summary judgment, and dismissed the case due to collat-

eral estoppel, this court affirms.

I.

For decades, Slesinger and Disney have disputed the

Winnie-the-Pooh rights in both state and federal courts as

well as at the Board. This case questions the registration

of various trademarks derived from the Winnie-the-Pooh

works. Because the Board premises its dismissal on

collateral estoppel, this court addresses briefly the back-

ground of Slesinger’s and Disney’s agreements about the

marks.

In 1930, A.A. Milne transferred to Stephen Slesinger

exclusive merchandising and other rights based on the

3 SLESINGER v. DISNEY ENTERPRISES

Winnie-the-Pooh works in the United States and Canada.

In 1961, Slesinger exclusively “assigned, granted, and set

over to” Walt Disney Productions the rights in the 1930

agreement with A.A Milne. Milne ex rel. Coyne v.

Slesinger, No. 2:02-cv-0858, 2009 WL 3140439, at *2 (C.D.

Cal. Sept. 25, 2009) (“Seller hereby assigns, grants, and

sets over unto the purchaser all of the further rights in

and to said work’ [sic] which are set forth in Paragraph 3

hereof. . .”).

In a 1983 agreement, Slesinger acknowledged its

transfer and assignment of “rights it had acquired from

A.A. Milne to Disney by agreement dated 14 June 1961.”

Id. The 1983 agreement then revoked the prior agree-

ments and gave Slesinger “all of the rights in the work

which were transferred to [Slesinger] in 1930 and

amended from time to time.” Id. In turn, Slesinger

transferred its rights back to Disney, as the agreement

also provided that Slesinger “assigns, grants, and sets

over unto Disney the sole and exclusive right in the

United States and Canada to project, exhibit, and broad-

cast visually and audibly any motion pictures . . .” as well

as “various further rights in and to said work, which

include merchandise . . .” television, radio, and analogous

processes. Id.

While the agreement sought to resolve the parties’

previous disputes and clarify their contractual arrange-

ments, the parties interpret the 1983 agreement differ-

ently. Slesinger contends it retained rights in the Winnie-

the-Pooh works, while Disney maintains Slesinger as-

signed all rights to Disney.

In 1991, before the present litigation began, Slesinger

brought an action in Los Angeles Superior Court alleging

Disney breached the 1983 agreement. Slesinger claimed

Disney’s revenue from Winnie-the-Pooh products was not

SLESINGER v. DISNEY ENTERPRISES 4

accurately calculated, meaning that Disney underpaid

royalties. Specifically, Slesinger alleged in state court

that the 1983 agreement gave Disney valuable rights “in

exchange for a share of the receipts from exploitation of

the Pooh characters.” Id. at *4. In the state court pro-

ceedings, Slesinger acknowledged that the 1983 agree-

ment “regranted, licensed and assigned all rights acquired

rights [sic] to Disney.” Id. Slesinger further explained

that “the grant of all ‘further rights’ in and to the Pooh

Characters . . . is a catch-all designed to ensure that

Slesinger was granting . . . all of the additional commer-

cial exploitation rights Slesinger acquired that are not

specifically mentioned in the 1983 Agreement.” Id. The

California state court ultimately dismissed Slesinger’s

claim, and the California Court of Appeals affirmed.

Meanwhile, the parties’ dispute over royalties pro-

ceeded in the Central District of California. In October

2006, Slesinger amended its district court claim to allege

that Disney’s exploitation of the Winnie-the-Pooh charac-

ters infringed Slesinger’s trademarks and copyrights.

Disney moved to dismiss the claim because Slesinger had

admitted in state court that Disney’s uses of the Winnie-

the-Pooh characters were authorized. Disney also con-

tended that Slesinger granted all of the rights it had in

the Winnie-the-Pooh characters to Disney and that

Slesinger retained no rights which Disney could infringe.

In 2009, the district court considered the parties’ cross

motions for summary judgment based on the 1983 agree-

ment and addressed the agreement’s scope, judicial

estoppel, and California’s Business and Professions Code.

The district court noted the parties’ actions indicated the

Winnie-the-Pooh rights were transferred to Disney in the

1983 agreement. Between 1983 and 2006, Disney regis-

tered at least fifteen trademarks. In 2004, Disney regis-

tered copyrights in forty-five works and renewed

5 SLESINGER v. DISNEY ENTERPRISES

copyright registrations for another fourteen. In contrast,

Slesinger did not attempt to perfect or register trade-

marks or copyrights before asserting its district court

claims. The district court further noted that Slesinger

never objected to those registrations until 2006, when the

state court dismissed Slesinger’s claims for royalty

agreement breach. Accordingly, the California district

court based its judgment against Slesinger on “the con-

duct of the parties over the nearly 50 years of their rela-

tionship.” Id.

The district court also addressed Slesinger’s argu-

ments that it did not relinquish all the rights it received

from A.A. Milne to Disney. However, because Slesinger

could not specifically identify any retained right, the court

determined that the contracts did not permit any reten-

tion of rights. Thus, upon its review of the 1983 agree-

ment, the court found that Slesinger granted its acquired

rights to Disney. In sum, given the parties’ conduct, and

the “clear terms” of the agreements, the district court

determined that Slesinger “transferred all of its rights in

the Pooh works to Disney, and may not now claim in-

fringement of any retained rights.” Id.

Applying the doctrine of judicial estoppel, the district

court found Slesinger’s arguments “inconsistent with

statements made and positions taken by SSI in the state

court litigation.” Id. at *5. In state court, Slesinger “has

insisted that Disney’s uses of the works were derived from

the SSI grants of ‘all’ rights to sound, word, picture repre-

sentation, television, any representational device, similar

or allied devices, videocassettes, promotion and advertis-

ing in all media, exploitation and licensing in all media.”

Id. at *4. Thus, the district court based its finding of

estoppel on Slesinger’s inconsistent positions. Id. at *5

(“SSI’s conduct demonstrates a blatant effort to salvage

SLESINGER v. DISNEY ENTERPRISES 6

its lawsuit against Disney by taking an [sic] taking en-

tirely inapposite and inconsistent posture in this case.”).

This dispute at the Board began in December 2006.

Slesinger now attempts to cancel Disney’s applications to

register the marks POOH, WINNIE THE POOH,

CLASSIC POOH, MY FRIENDS TIGGER & POOH, and

other marks comprising the names or images of “Pooh”

and related fictional characters. Slesinger claims the

agreement with Disney is a license, which does not grant

Disney the right to register the marks. Disney maintains

the agreement assigned all the Winnie-the-Pooh rights to

Disney and filed a motion to dismiss. Treating the motion

as one for summary judgment, the Board found that

collateral estoppel barred Slesinger’s claims and granted

Disney’s motion. The Board’s decision relied on the

earlier district court order in Milne ex rel. Coyne v.

Slesinger, No. 2:02-cv-0858 (C.D. Cal. Sept. 25, 2009).

Accordingly, this court therefore considers the Board’s

application of collateral estoppel based on the Central

District of California’s ruling. This court has jurisdiction

over Slesinger’s appeal pursuant to 28 U.S.C.

§ 1295(a)(4)(B) and 15 U.S.C. § 1071(a)(1).

II.

This court reviews the Board’s decision to grant sum-

mary judgment without deference. Odom’s Tenn. Pride

Sausage, Inc. v. FF Acquisition, LLC, 600 F.3d 1343, 1345

(Fed. Cir. 2010). The doctrine of issue preclusion, or

collateral estoppel, protects the finality of judgments by

“preclud[ing] relitigation in a second suit of issues actu-

ally litigated and determined in the first suit.” In re

Freeman, 30 F.3d 1459, 1465 (Fed. Cir. 1994) (citing

Lawlor v. Nat’l Screen Serv. Corp., 349 U.S. 322, 326

(1955)). Collateral estoppel requires four elements: (1) a

prior action presents an identical issue; (2) the prior

7 SLESINGER v. DISNEY ENTERPRISES

action actually litigated and adjudged that issue; (3) the

judgment in that prior action necessarily required deter-

mination of the identical issue; and (4) the prior action

featured full representation of the estopped party. See

Laguna Hermosa Corp. v. United States, 671 F.3d 1284,

1288 (Fed. Cir. 2012) (citing Freeman, 30 F.3d at 1465).

Slesinger concedes that this case satisfies the first

and fourth factors. Indeed, the Central District of Cali-

fornia litigated the identical issue, the scope of the 1983

agreement, and Slesinger was fully represented.

On the second factor, Slesinger contends that the dis-

trict court did not properly consider the critical issue on

the scope of the 1983 agreement. The record shows that

the district court extensively analyzed the scope of the

1983 agreement. For example, Slesinger specifically

presented this identical issue as its Second Claim for

Relief. Indeed Slesinger maintained in that action that

the 1983 agreement was a license rather than an assign-

ment. Likewise, the parties’ district court briefing exten-

sively addressed the agreement’s scope as an assignment

or a license. Accordingly, the record shows that the

district court litigated and decided the identical issue.

Slesinger, however, argues that the district court did

not specifically declare that Slesinger “has no rights at

all”, thus implying some rights may survive the 1983

agreement. To bolster this contention, Slesinger argues

the district court’s ruling, which uses the term “retained

rights,” implies Slesinger licensed its rights to Disney.

Also, it claims the district court’s “broad” conclusion did

not definitively resolve the license or assignment issue.

Slesinger notes the district court did not use the term

“assignment” and its reference to the “grant” or “transfer”

supports Slesinger’s contention the 1983 agreement was a

license because such terms are associated with licensing.

SLESINGER v. DISNEY ENTERPRISES 8

To the contrary, the Board properly addressed these

points and dismissed them as meritless. In the words of

the Board, “[t]he clear wording of the district court’s order

does not support SSI’s contention that the decision was

focused only on whether a particular array of uses by

Disney of the POOH works was authorized.” Consoli-

dated Proceedings, 98 U.S.P.Q.2d at 1897.

From this court’s perspective, the Board’s determina-

tion accurately tracks the district court’s holding that the

1983 agreement represented “a transfer from SSI to

Disney of all of SSI’s interests in the Pooh characters,”

Milne, 2009 WL 3140439 at *4 (emphasis in original), and

that “under the clear terms of the parties’ agreements,

SSI transferred all of its rights in the Pooh works to

Disney, and may not now claim infringement of any

retained rights.” Id. Moreover, the “unambiguous nature

of the contracts is strongly supported by the conduct of

the parties over the nearly 50 years of their relationship,”

as both parties treated the agreements as constituting a

complete assignment of Slesinger’s rights to Disney. Id.

Thus, the record shows that the district court did not find

that Slesinger “retained” some rights. See Freeman, 30

F.3d at 1466 (“[T]he requirement that the issue have been

actually decided is generally satisfied if the parties to the

original action disputed the issue and the trier of fact

decided it.”) (citing Mother’s Rest., Inc. v. Mama’s Pizza,

Inc., 723 F.2d 1566, 1569 (Fed. Cir. 1983)).

The record shows the district court concluded that

Slesinger completely granted all its rights to Disney as an

assignment. See, e.g., In re Computer Eng’g Assocs., 337

F.3d 38, 46 (1st Cir. 2003) (assignment where party

divests itself of “all right, interest, and control in the

property”); In re Apex Oil Co., 975 F.2d 1365, 1369 (8th

Cir. 1992) (“assignment” defined “as a transfer by the

assignor of all rights in the property”); 3 J. Thomas

9 SLESINGER v. DISNEY ENTERPRISES

McCarthy, McCarthy on Trademarks & Unfair Competi-

tion § 18:1 (4th ed. 2012) (assignment is “an outright sale

of all rights in . . . [a] mark,” whereas license “is a limited

permit to another to use the mark”). With such a clear

explanation that Slesinger conveyed all rights completely

to Disney, it is immaterial that the district court used the

terms “transfer” and “grant” rather than “assignment.”

Moreover, it is the court’s ultimate “judgment that mat-

ters,” not the language used to discuss the court’s rulings.

Yamaha Corp. of Am. v. United States, 961 F.2d 245, 254

(D.C. Cir. 1992) (emphasis in original); see also Clark v.

Bear Stearns & Co., 966 F.2d 1318, 1321 (9th Cir. 1992)

(“When the issue for which preclusion is sought is the only

rational one the fact finder could have found, then that

issue is considered foreclosed, even if no explicit finding of

that issue has been made.”); 18 Lawrence B. Solum,

Moore’s Federal Practice – Civil § 132.03[3][e] (Matthew

Bender 3d ed.) (“An issue that was necessarily implicit in

a larger determination is given issue preclusive effect. An

issue that is distinctly presented in the pleadings and

necessarily resolved may be reflected in the decision that

includes that point, although it may not be expressly

mentioned in the decision.”).

Finally, after determining that Slesinger had no own-

ership interest in the Pooh rights, the district court con-

cluded that Slesinger “fully adjudicated all claims and

counterclaims” and held “all of [Slesinger’s] Counter-

claims are dismissed on the merits and with prejudice.”

Milne, 2009 WL 3140439 at *6. The district court un-

equivocally decided that Slesinger was not entitled to its

requested relief. Therefore, the record shows that the

district court ruled on and denied Slesinger’s specific

request for an order directing the Board to correct Dis-

ney’s Pooh-related trademark registrations to reflect

Slesinger’s name.

SLESINGER v. DISNEY ENTERPRISES 10

The third element of the estoppel formula prevents

“the incidental or collateral determination of a nonessen-

tial issue from precluding reconsideration of that issue.”

Mother’s Rest., 723 F.2d at 1571. In this instance, the

district court’s ruling is neither incidental nor collateral.

Rather it directly addressed Slesinger’s ownership inter-

est in the Pooh rights. The record shows that the evalua-

tion of these rights was clearly an essential element of the

judgment. Indeed the district court had to determine this

issue before deciding whether Disney’s uses of the Win-

nie-the-Pooh rights were infringing. Likewise, it was

essential to first determine whether Slesinger had any

ownership rights in the marks before considering

Slesinger’s request to correct Disney’s trademark regis-

trations to Slesinger’s name.

Accordingly, the Board correctly applied collateral es-

toppel to prevent Slesinger from asserting a claim that its

1983 grant of rights to Disney was a license as opposed to

an assignment.

AFFIRMED

COSTS

Each party shall bear its own costs.

United States Court of Appeals

for the Federal Circuit

__________________________

STEPHEN SLESINGER, INC.,

Appellant,

v.

DISNEY ENTERPRISES, INC.,

Appellee.

__________________________

2011-1593

(Opposition Nos. 91179064, 91182358, 91183644,

91186026, 91187261, 91188860, 91191230, 91192691,

91194551, 91196019, and 91198046; and

Cancellation No. 92046853)

__________________________

Appeal from the United States Patent and Trademark

Office, Trademark Trial and Appeal Board.

__________________________

REYNA, Circuit Judge, dissenting.

The issue before us is whether the district court de-

cided the ownership of the Winnie-the-Pooh trademarks.

Because I believe the district court did not decide owner-

ship of the Pooh trademarks, and because I believe that a

decision on ownership was not necessary to the district

court’s decision concerning trademark infringement, I

respectfully dissent.

SLESINGER v. DISNEY ENTERPRISES 2

I. COLLATERAL ESTOPPEL

Collateral estoppel, often called “issue preclusion,”

bars relitigation in a second action of an issue litigated

and decided in a prior action. Because preclusion may

forever bar meritorious claims and negate significant

legal rights, courts must ensure that the circumstances

for preclusion are “certain to every intent.”

Mayer/Berkshire Corp. v. Berkshire Fashions, Inc., 424

F.3d 1229, 1234 (Fed. Cir. 2005) (citing Russell v. Place,

94 U.S. 606, 610 (1876)). Precedent weighs against deny-

ing litigants a day in court unless there is a clear and

persuasive basis for that denial. If there exists a reason-

able doubt as to whether an issue was actually decided in

the first action, preclusion should not apply in the subse-

quent action. Kearns v. Gen. Motors Corp., 94 F.3d 1553,

1557 (Fed. Cir. 1996); McNellis v. First Fed. Sav. & Loan

Ass’n of Rochester, New York, 364 F.2d 251, 257 (2d Cir.

1966) (“[A] reasonable doubt as to what was decided in

the first action should preclude the drastic remedy of

foreclosing a party from litigating an essential issue.”

(internal citation omitted)). Guided by these principles,

we resolve ambiguities in what issues were actually

decided in a prior proceeding in favor of the party seeking

to prevent application of preclusion. Charter Fed. Sav.

Bank v. United States, 87 F. App’x 175, 178 (Fed. Cir.

2004) (nonprecedential).

The Supreme Court summarized the requirements of

issue preclusion in Montana v. United States, 440 U.S.

147, 153-55 (1979). Issue preclusion requires (1) identity

of an issue in a prior proceeding, (2) that the identical

issue was actually litigated and decided, (3) that determi-

nation of the issue was necessary to the judgment in the

prior proceeding, and (4) that the party defending against

preclusion had a full and fair opportunity to litigate the

issue in the prior proceeding. Montana, 440 U.S. at 153–

3 SLESINGER v. DISNEY ENTERPRISES

55. The burden is on the party seeking preclusion to show

“that the same issue was ‘actually and necessarily deter-

mined’ in the prior proceeding.” Connors v. Tanoma Min.

Co., Inc., 953 F.2d 682, 684-85 (D.C. Cir. 1992).

We owe no deference to a determination by the

Trademark Trial and Appeal Board (“TTAB”) on preclu-

sion. In re Trans Texas Holdings Corp., 498 F.3d 1290,

1296 (Fed. Cir. 2007). As it has been observed by other

courts, the correctness of the earlier decision is not an

issue, and it is irrelevant to the application of the estop-

pel. Westwood Chem., Inc. v. U. S., 525 F.2d 1367, 1375

(Ct. Cl. 1975). It is therefore inappropriate to consider

whether the earlier decision was correct; the law “does not

authorize unbridled excursions into the record of the

earlier trial before applying the estoppel of the previous

judgment.” See Gammino v. Sprint Commnc’ns. Co. L.P.,

No. 10-2493, 2011 WL 3240830 (E.D. Pa. July 29, 2011).

In view of the foregoing, I believe the TTAB erred on

two distinct grounds when it determined that the trade-

mark ownership issue was precluded. First, the district

court did not actually decide the ownership issue. Second,

resolution of the ownership issue was not essential or

necessary for the district court’s decision on non-

infringement.

A. A REASONABLE DOUBT

The basic question before the district court was

whether Disney had infringed the Pooh trademarks.

Disney asserted as a defense to infringement that it had a

legal right to use the Pooh trademarks based on a trans-

fer of the marks from Slesinger to Disney. The court was

asked to resolve whether the transfer effected a license

(for use), or an assignment (sale) of the trademarks. The

parties briefed the license-assignment issue, so there is no

question as to whether the license-assignment issue was

SLESINGER v. DISNEY ENTERPRISES 4

litigated. But there exists reasonable doubt whether the

district court actually decided the issue. The court does

not explicitly state in clear, plain language whether the

grant of rights, i.e., the transfer, was a license or an

assignment. In relevant part, the district court’s opinion

states,

Disney puts forth two main contentions in its Mo-

tion: First, that Slesinger granted to Disney all of

the rights it had in the Pooh characters, and re-

tained no rights which Disney could infringe, and

second, that Slesinger's counterclaims are incon-

sistent with its earlier position in the Superior

Court action that Disney’s uses of the Pooh char-

acters were authorized and royalty-producing. The

Court agrees with both propositions.

Milne ex rel. Coyne v. Slesinger, 2:02CV08508-FMC-

PLAX, 2009 WL 3140439 at *1 (C.D. Cal. Sept. 25, 2009)

(emphases added). The district court’s use of the phrase

“granted to Disney all of the rights” could indicate an

assignment, but it could also indicate a license to use, i.e.,

to promote, advertise and otherwise exploit the commer-

cial value of the trademarks. See, e.g., In re Polar Music

Int’l AB, 714 F.2d 1567, 1569 (Fed. Cir. 1983) (“Subject to

certain terms and conditions, Atlantic is granted the right

to use the mark ‘ABBA’ and likenesses of the group in

connection with the promotion, advertising, distribution,

exploitation, and sale of records embodying the master

recordings made by appellant.” (emphases added)).

Similarly, the district court’s conclusion that Slesinger

“retained no rights which Disney could infringe” is equally

consistent with either a license or an assignment. The

court’s recognition that “Disney’s uses of the Pooh charac-

ters were authorized and royalty-producing” can reasona-

bly refer to an assignment, but the words chosen by the

court are more consistent with a license given the implied

5 SLESINGER v. DISNEY ENTERPRISES

extension of authority and the obligation for continued

royalty payments for use of the Pooh trademarks.

Indeed, the district court’s opinion appears to suggest

that Slesinger retained some rights to the Pooh trade-

marks, but that any rights retained were insufficient to

support an infringement action. Milne, 2009 WL 3140439

at *4 (“Slesinger transferred all of its rights in the Pooh

works to Disney, and may not now claim infringement of

any retained rights.”). This scenario is as suggestive of a

license as it is of an assignment. See Exxon Corp. v.

Oxxford Clothes, Inc., 109 F.3d 1070, 1076 (5th Cir. 1997)

(“A license to use a mark is a transfer of limited rights,

less than the whole interest which might have been

transferred.” (emphases added; internal quotation marks

omitted)); Consol. Foods Corp. v. United States, 569 F.2d

436, 437 (7th Cir. 1978) (“This issue of whether a transfer

of the use of a trademark is a sale or a license for tax

purposes is a thorny one . . . .” (emphasis added)). It

follows that a finding that some or all rights were trans-

ferred is not itself determinative of ownership.

The district court’s failure to definitively and ex-

pressly state whether the transfer was a license or as-

signment is striking and illuminating. The district court’s

resort to ambiguity on the issue is significant given that

the parties fully briefed the issue. One explanation could

be that the district court found it unnecessary to actually

decide the issue as long as it focused on whether Disney

had a legal right to use the Pooh trademarks. In any

event, there exits reasonable doubt whether the court

actually decided that the transfer was accomplished via

an assignment, i.e., by outright sale. On that basis alone,

collateral estoppel should not apply.

SLESINGER v. DISNEY ENTERPRISES 6

B. OWNERSHIP NOT ESSENTIAL

For operation of preclusion, an issue must also be

necessary to the judgment in the previous action.

Mother’s Rest., Inc. v. Mama’s Pizza, Inc., 723 F.2d 1566,

1571 (Fed. Cir. 1983) (“In order to give preclusive effect to

a particular finding in a prior case, that finding must

have been necessary to the judgment rendered in the

previous action.”). The relevant question here is whether

the district court was necessarily required to decide

whether the transfer of the Pooh trademarks was an

assignment in order for the court to resolve the issue of

trademark infringement. See id. The answer is no.

Disney argues that in order for the district court to

evaluate whether Disney’s use of the Pooh trademarks

was infringing, the court first had to determine whether

Slesinger or Disney owned the rights. This is incorrect.

As happened precisely in this case, an effective defense to

a claim of trademark infringement can be made upon a

showing of authorized use under a license. De Forest

Radio Tel. & Tel. Co. v. United States, 273 U.S. 236, 242

(1927) (“If a licensee be sued, he can escape liability to the

patentee for the use of his invention by showing that the

use is within his license.”); see also 3 McCarthy on

Trademarks and Unfair Competition § 18:40 (4th ed.

2011) (“Every license carries with it a waiver of the right

of the trademark owner to sue for infringement arising

out of acts that fall within the scope of the license.”).

Whether Disney was authorized to use the Pooh trade-

marks does not solely depend on whether Slesinger or

Disney owned the marks, because Disney could have been

authorized to use the Pooh trademarks under a license.

The majority acknowledges that the district court

never directly addresses the license-assignment issue, and

the majority cites authorities discussing application of

7 SLESINGER v. DISNEY ENTERPRISES

preclusion where no explicit findings were made in the

prior action. Those authorities, however, require that the

precluded issue be “the only rational one the fact finder

could have found,” Clark, 966 F.2d at 1321; that the issue

was “necessarily implicit in a larger determination,”

Moore’s Federal Practice – Civil § 132.03[3][e]; and that

the issue was “necessarily resolved,” id. That is not the

case here. Here, ownership of the Pooh trademarks was

not the only rational basis on which a fact finder could

find non-infringement. An equally rational basis is that

Disney was an authorized user under a license. It follows

that collateral estoppel cannot apply.

Because the court could have disposed of Slesinger’s

infringement claims solely on the basis that Disney was

authorized to use the Pooh trademarks, it is clear that a

decision on ownership of the rights was not essential to

the court’s judgment on infringement. This alone is

sufficient to preclude the application of collateral estop-

pel.

Based on the foregoing, I believe the TTAB erred in

precluding Slesinger from disputing the ownership of the

Pooh trademarks. I therefore respectfully dissent.