The CAFC affirmed the TTAB's decision finding a likelihood of confusion between the two marks shown immediately below for athletic clothing. On appeal, Applicant Hylete argued that the Board erred by considering only Opposer Hybrid's design mark and not its "composite common law mark" comprising the stylized "H" design above the phrase "Hybrid Athletics" and several dots (shown further below). The court, however, found that Hylete had waived this argument because it was not raised prior to the appeal. Hylete LLC v. Hybrid Athletics, LLC, Appeal No. 2017-2057 (August 2, 2019) [precedential].
Before the Board, Hylete had argued that its mark was a "highly stylized design logo" that was "substantially dissimilar" from Hybrid's logo. The Board, however, found that both marks are stylized versions of the letter "H" that have similar commercial impressions, and it concluded that confusion is likely.
At the CAFC, Hylete argued that the Board erred in failing to compare Hylete's "H" mark with Hybrids's "composite common law mark" instead of just Hybrid's common law "H" mark. Hylete posed the issues on appeal as a "single question: is Hylete's mark sufficiently similar to [Hybrid's] composite common law mark to be likely to cause confusion on the part of the consumer ...."
Hybrid responded by pointing out that the "composite common law mark" arguments were never raised before the Board and were therefore waived. The CAFC agreed.
Absent exceptional circumstances, federal appellate courts do not consider issues "not passed upon below," or entertain arguments not made before the lower tribunal. Golden Bridge Tech., Inc. v. Nokia, Inc., 527 F.3d 1318, 1322 (Fed. Cir. 2008); Finch v. Hughes Aircraft Co., 926 F.2d 1574, 1576 (Fed. Cir. 1991). The CAFC has found it appropriate to consider issues raised for the first time on appeal in limited circumstances:
We have articulated limited circumstances in which considering arguments made for the first time on appeal is appropriate: (1) "[w]hen new legislation is passed while an appeal is pending, courts have an obligation to apply the new law if Congress intended retroactive application even though the issue was not decided or raised below"; (2) "when there is a change in the jurisprudence of the reviewing court or the Supreme Court after consideration of the case by the lower court"; (3) "appellate courts may apply the correct law even if the parties did not argue it below and the court below did not decide it, but only if an issue is properly before the court"; and (4) "where a party appeared pro se before the lower court, a court of appeals may appropriately be less stringent in requiring that the issue have been raised explicitly below." Golden Bridge, 527 F.3d at 1322–23 (quoting Forshey v. Principi, 284 F.3d 1335, 1353–57 (Fed. Cir. 2002)).
Hylete did not dispute that it failed to raise the "composite common law mark" issue at the Board. Instead, it contended that the Board "sua sponte" raised the issue in its final decision (here) and that the Board applied an incorrect legal standard in comparing the marks. The CAFC observed, however, that Hylete failed to assert that the Board had compared the wrong marks when Hybrid sought reconsideration of the Board's decision. Instead, it had focused on the two "H" marks.
Hylete was on notice of Hybrid's common law rights from the time when the notice of opposition was filed, and Hybrid subsequently submitted evidence of use of its mark. Hylete could have raised the "composite common law mark" in the opposition proceeding. "Thus, none of the exceptional circumstances in which it is appropriate to consider arguments for the first time on appeal are present here, and declining to consider Hylete's new arguments does not result in injustice. See Golden Bridge, 527 F.3d 1323."
The CAFC therefore held that Hylete had waived its "composite common law mark" arguments. The court declined to address the Board's analysis with regard to Hybrid's "H" mark, since the only issues raised on appeal related to the "composite common law mark." The CAFC accordingly affirmed the Board's decision.
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