Today, the Supreme Court issued two decisions, described below, of interest to the business community.

  • Trademark Tacking—Question of Fact for Jury
  • Federal Appellate Jurisdiction—Finality Of Order Dismissing One Among Many Consolidated Cases

Trademark Tacking—Question of Fact for Jury

Hana Financial, Inc. v. Hana Bank, No. 13-1211 (described in the June 23, 2014, Docket Report)

To have a protected interest in a trademark, a party must be the first to use it; such a party has "priority" and thus may exclude others from using the mark. To permit a party to update or modernize a mark without losing priority, courts have recognized a trademark "tacking" doctrine. If the later mark is so similar that it is "legally equivalent" to the earlier mark, the two marks may be "tacked," meaning that the later mark takes on the priority date of the earlier mark. Today, in Hana Financial, Inc. v. Hana Bank, No. 13-1211, the Supreme Court resolved a conflict among the courts of appeals over whether trademark tacking is a question of law for a court or a question of fact for the jury. The Court held that it is a question of fact for the jury.

Petitioner Hana Financial, Inc., the owner of the federally registered trademark "Hana Financial," sued respondents Hana Bank and Hana Financial Group for trademark infringement based on their use of "Hana Bank." Respondents argued that they had priority based on the trademark-tacking doctrine. Specifically, they claimed that the mark "Hana Overseas Korean Club" could be tacked to a later mark, "Hana World Center," and that "Hana World Center" could then be tacked to "Hana Bank," making the priority date for "Hana Bank" the same as the one for "Hana World Center." The district court held that it was for the jury to determine whether these marks are "legal equivalents." The jury found that they were, and returned a verdict in favor of respondents. The Ninth Circuit affirmed, explaining that, "[i]n our circuit, tacking presents a question of fact that must ultimately be decided by the jury unless the evidence is so strong that it permits only one conclusion." Hana Financial Inc. v. Hana Bank, 735 F.3d 1158, 1168 (9th Cir. 2013).

In a unanimous opinion by Justice Sotomayor, the Supreme Court affirmed. The Court held that "[b]ecause the tacking inquiry operates from the perspective of an ordinary purchaser or consumer," "a jury should make th[e] determination" "whether tacking is available in a given case." The Court observed that it has "long recognized across a variety of doctrinal contexts that, when the relevant question is how an ordinary person or community would make an assessment, the jury is generally the decisionmaker that ought to provide the fact-intensive answer." The Court made clear, however, that its holding is limited to situations in which "a jury trial has been requested" and "the facts do not warrant entry of summary judgment or judgment as a matter of law."

Federal Appellate Jurisdiction—Finality Of Order Dismissing One Among Many Consolidated Cases

Gelboim v. Bank of America Corp., No. 13-1174 (described in the June 30, 2014, Docket Report)

Under 28 U.S.C. § 1291, the federal courts of appeals have jurisdiction over "final decisions of the district courts." Today, the Supreme Court unanimously held that complaints that have been consolidated for purposes of multidistrict litigation ("MDL") pretrial proceedings "retain[] [their] independent status for purposes of appellate jurisdiction under § 1291." Thus, plaintiffs may appeal "when the District Court dismisse[s] their case, not upon eventual completion of multidistrict proceedings in all of the consolidated cases."

The Supreme Court's decision arose from more than 60 lawsuits alleging that financial institutions had manipulated the London Interbank Offered Rate ("LIBOR"), which provides a benchmark for short-term interest rates. The Judicial Panel on Multidistrict Litigation transferred the LIBOR-related litigation to the United States District Court for the Southern District of New York for consolidated pretrial proceedings. One of those lawsuits was Gelboim, a putative class action alleging violations of the federal antitrust laws. Other lawsuits in the MDL proceeding asserted similar antitrust claims, as well as claims under other federal and state laws.

The district court subsequently dismissed the antitrust claims in all the MDL proceedings—and those were the only claims asserted in Gelboim—but concluded that various other claims raised in the other consolidated actions could proceed to discovery.

The Gelboim plaintiffs appealed the dismissal of their action. The Second Circuit dismissed the appeal, however, because the district court had not dismissed all the claims in all the consolidated actions. The Supreme Court unanimously reversed and remanded for further proceedings.

In an opinion by Justice Ginsburg, the Court unanimously held that "[c]ases consolidated for MDL pretrial proceedings ordinarily retain their separate identities, so an order disposing of one of the discrete cases in its entirety should qualify under § 1291 as an appealable final decision." The Court made clear, however, that its holding was limited to the procedural posture of the case. Although the various actions had been transferred to the MDL court for pretrial proceedings, the actions had not been consolidated for all purposes, including trial, as sometimes occurs when the Judicial Panel on Multidistrict Litigation transfers related lawsuits to a single court. The Supreme Court stated: "We express no opinion on whether an order deciding one of multiple cases combined in an all-purpose consolidation qualifies under § 1291 as a final decision appealable of right."

The decision in Gelboim is of significant interest to businesses that are or may be involved in MDL litigation in federal court because the Supreme Court's decision will determine whether appeals in those actions must await the final resolution of all the consolidated cases.

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