IP Law Daily, TRADEMARK—W.D. Ky.: District court has jurisdiction in trademark cancelation claim against PetSmart, (Oct 7, 2024)

By Jonathan Anderson

The court applied Continental Connector and declined to take a stance on a recent Ninth Circuit decision that held district courts can review and rule on pending trademark applications.

The U.S. District Court for the Western District of Kentucky has declined to dismiss part of a complaint seeking refusal of an application for registration in a trademark dispute between a dog food manufacturer and pet retailer PetSmart. Holding that it has subject matter jurisdiction, the court applied the Continental Connector exception allowing district courts to cancel patent applications when there is a sufficient nexus to litigation involving a registered mark. The court declined to take a stance on BBK Tobacco & Foods LLP v. Central Coast Agric., Inc., 97 F.4th 668 (9th Cir. 2024), a recent Ninth Circuit decision holding district courts can review and rule on pending trademark applications (Rudy Green, Inc. v. PetSmart, LLC, No. 3:24-cv-00322-RGJ (W.D. Ky. Oct. 4, 2024)).

Background. Between 2008 and 2014, Rudy Green, Inc., a manufacturer of frozen human grade dog food, filed three trademarks for use with pet foods and treats with the U.S. Patent and Trademark Office (USPTO): “Rudy Green’s Doggy Cuisine®,” with first use at least as early as May 1, 2007, in addition to “Rudy Green’s®” and “Chef Rudy®.” The company alleged that in 2008 and 2021, it held discussions with PetSmart about selling its products in PetSmart stores, but the two never agreed to terms.

On July 28, 2023, PetSmart filed for use of the mark “RUDY’S” in connection with rawhide dog chews with the USPTO. The USPTO issued a Nonfinal Office Action on March 6, 2024, refusing the application in view of registrations owned by Rudy Green. PetSmart had until Sept. 6, 2024, to either file a substantive response or abandon the application by not responding.

On May 30, 2024, Rudy Green filed a five-count complaint against PetSmart in Federal District Court alleging (I) federal trademark infringement under the Lanham Act, 15 U.S.C. § 1501, et seq.; (II) refusal of application for registration under 15 U.S.C. § 1052(d); (III) trademark infringement under Kentucky common law; (IV) federal unfair competition and false designation of origin under the Lanham Act; and (V) unfair competition under Kentucky common law.

PetSmart moved to dismiss Count II of the complaint for lack of subject matter jurisdiction, arguing that the ability to adjudicate pending trademark applications belongs exclusively to the USPTO. Rudy Green countered that the Lanham Act and relevant case law create an exception that allows district courts to cancel pending trademark registration applications.

Jurisdictional analysis. The court concluded it has subject matter jurisdiction and denied PetSmart’s motion to dismiss count II of the complaint. The court recognized the exception established in Continental Connector, which allows district courts to cancel patent applications when there is a sufficient nexus to litigation involving a registered mark. PetSmart had argued that Continental Connector is not binding authority, and that the exception it presents has not been adopted in the Sixth Circuit. However, the court observed that numerous courts within the Sixth Circuit have followed Continental Connector.

As part of its analysis, the court rejected an argument by PetSmart that even if Continental Connector applies, count II should be dismissed because its mark, “RUDY’S,” is not sufficiently similar to any of Rudy Green’s marks to qualify for the exception. PetSmart claimed that in all cases accepted under the exception, the marks have been “nearly identical.” The court said PetSmart’s argument was a misstatement of the rule, which allows cancellation of an application “so long as the applicant was a party to the lawsuit and the application was for a mark sufficiently related to a registered mark.” The court said PetSmart is a party to a lawsuit involving another registered mark, namely Rudy Green’s three registered marks. Both marks deal with sufficiently similar product lines, the marks are sufficiently similar, and both marks are made up of the same base mark, “RUDY,” but with different modifying words. Further, the USPTO acknowledged the marks are sufficiently similar in refusing registration of PetSmart’s mark.

Given the applicability of Continental Connector, the court declined to take a stance on BBK Tobacco & Foods LLP v. Central Coast Agric., Inc., 97 F.4th 668 (9th Cir. 2024), a recent decision from the Ninth Circuit that held district courts had the ability to review and rule on pending trademark applications.

The Case is No. 3:24-cv-00322-RGJ.

Judge: Jennings, R.

Attorneys: Andrew Dorisio (Dickinson Wright PLLC) for Rudy Green, Inc. Jacob S. Wharton (Womble Carlyle Sandridge & Rice, PLLC) for PetSmart, LLC.

Companies: Rudy Green, Inc.; PetSmart, LLC

Cases: Trademark KentuckyNews