Trademark Trial and Appeal Board Electronic Filing System. 3935
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`ESTTA Tracking number: ESTTA34480
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`Filing date3
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`06/01/2005
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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
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`Proceeding
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`91160985
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`Defendant
`Rhoades, Dean L.
`Rhoades, Dean L.
`i 9107 Wilshire Boulevard, Suite 400
`Beverly Hills, CA 90210
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`Wesley T. Miller, Esq.
`DermaNeW, Inc.
`Correspondence 9107 Wilshire BlVd., Suite 400
`Address
`Beverly Hills, CA 90210
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`Submission
`Filer's Name
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`Wes1eytmi11er@coX.net
`Opposition]Response to Motion
`Wesley T. Miller
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`Filer's e-mail
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`Wes1eytmi11er@coX.net
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`Signature
`“Date
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`Attachments
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`/Wesley T. Miller!
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`99’o.;.;’.;;99M;;¢;;;;.9;;; iéiéfiifiiéi“L“i0}5§1§iE{91iiébiéiéiéflfiéiffiiiéiiifiégéiéiji
`Miller Decl - Opposition to Motion to Compel - Opp No
`91160985.pdf( 4 pages)
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`

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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
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`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
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`Opposition No. 91160985
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`Avon Products, Inc.,
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`Opposer,
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`V.
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`Rhoades, Dean L.,
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`Applicant
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`\_/\_/\_/\_/\_/\_/\_/\_/\_/
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`APPLICANT’S OPPOSITION TO OPPOSER’S MOTION TO COMPEL
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`DISCOVERY AND FOR DISCOVERY SANCTIONS
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`1. PRELIMINARY STATEMENT
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`Applicant Dean L. Rhoades (“Applicant”) submits this OPPOSITION to
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`OPPOSER Avon Products, Inc.’s MOTION TO COMPEL DISCOVERY AND FOR
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`DISCOVERY SANCTIONS ("MOTION TO COMPEL"). By its MOTION TO
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`COMPEL, Avon Products, Inc. (“Avon”) attempts to prolong proceedings before the
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`Trademark Trial and Appeal Board ("TTAB") when in fact the proper forum for the
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`dispute between Applicant and Avon is in federal court. Moreover, Avon's MOTION TO
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`COMPEL causes undue hardship and expense to Applicant and usurps the resources of
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`this Board for no legitimate or meritorious purpose.
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`Indeed, Avon's MOTION TO
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`COMPEL fails to explain why Avon requires discovery in the TTAB proceeding when it
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`will have the same opportunity to request discovery in the pending federal court action.
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`Finally, Avon offers no legal or factual support for sanctions against Applicant, who
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`declined to respond to discovery requests after making a procedurally proper motion to
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`suspend the TTAB proceedings.
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`Accordingly, the Board should grant Applicant’s pending MOTION TO
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`SUSPEND PROCEEDING PENDING CIVIL ACTION and deny Avon’s MOTION TO
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`COMPEL: l) as lacking merit based upon the circumstances presented; 2) as contrary to
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`long—standing Board policy and the authority granted the Board under Trademark Trial
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`and Appeal Board Manual of Procedure (“TBMP”) § 510.02 and 37 C.F.R. § 2.1 l7(a);
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`3) to promote judicial economy by allowing a consolidation of the issues presently before
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`the Board to be more fully and uniformly litigated in the United States District Court
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`Civil Action No. 05—02l69R (MANX); and, 4) to avoid inconsistent judgments in the civil
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`action in the District Court and in the multitude of TTAB proceedings.
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`This OPPOSITION TO MOTION TO COMPEL is supported by the Declaration
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`of Wesley T. Miller ("Miller Decl."), Counsel for Applicant, which is attached hereto and
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`incorporated by reference.
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`II.
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`ARGUMENT
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`A.
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`AVON MISCHARACTERIZES THE CIRCUMSTANCES
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`LEADING UP TO ITS MOTION TO COMPEL IN AN ATTEMPT
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`TO NEEDLESSLY PROLONG THE TTAB PROCEEDINGS
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`Contrary to Avon's assertions, Applicant had been engaged in good faith
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`settlement negotiations with Avon until the final breakdown of the negotiations on March
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`24, 2005. On that date, and after Applicant rejected oppressive and overreaching
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`settlement terms having nothing to do with the trademark dispute, in—house counsel for
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`Avon, John Bergin, declared the negotiations to be “at an impasse,” and he went on to
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`state that the attorneys for Avon wanted to confer privately to “examine their options.”
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`Miller Decl., ‘][ 5. Before the negotiations broke down, Mr. Bergin had insisted on terms
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`that Applicant believed to be oppressive and overreaching and unrelated to the
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`trademarks at issue in the dispute between Applicant and Avon. Id. Mr. Bergin prefaced
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`his insistence on the oppressive and overreaching terms by stating that Avon would not
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`give up its “right to damages” in settlement without obtaining those terms. Id. As the
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`Board is well aware, its powers do not include the right to award damages of any kind.
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`Therefore, a claim for damages could only be made in litigation at the District Court
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`level, which is where the parties are now. It was in this context that Applicant made the
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`decision to seek full and uniform litigation of all trademark issues with Avon, and to
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`obtain finality to theses issues, in the Unites States District Court.
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`Avon asserts in its MOTION TO COMPEL that Applicant filed a Complaint for
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`declaratory judgment “in order to thwart Avon’s discovery.” This assertion lacks any
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`factual or legal foundation or any foundation in the long—standing policies and practices
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`of the Board in promoting judicial economy. Indeed, given that full discovery will occur
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`and depositions will be taken as a result of, and incident to, the pending civil action,
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`Avon's assertion of dilatory tactics is disingenuous.
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`Moreover, Applicant did not make the decision to file a federal court action
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`lightly. Federal court litigation presents a serious financial burden to Applicant and his
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`company. As a plaintiff in a federal court action, Applicant is required to prosecute the
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`case or else face the risk of dismissal. Because of the serious nature of federal court
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`litigation, it is inconceivable that Applicant filed a federal lawsuit simply to "sidle out
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`from under Board discovery deadlines", as Avon has asserted.
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`In its MOTION TO COMPEL, Avon offers as additional alleged evidence of
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`Applicant’s “delaying tactics” the fact that Applicant has experienced several changes of
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`counsel representing him in these proceedings. This assertion stands in contrast to the
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`well—established public policy against punishing a party or allowing any negative
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`inferences to be drawn from a party’s selection of more effective representation.
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`Moreover, at the times of Applicant’s changes in counsel of record, there were no
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`pending discovery requests from Avon, and the changes in counsel had no significant
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`impact in prolonging either the negotiations with Avon or these proceedings. Miller
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`Decl. ‘][ 9. Accordingly, Avon’s argument is completely without merit.
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`Avon has mischaracterized Applicant's intent in filing a federal court action in yet
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`other ways. For example, on page 1 of Avon’s MOTION TO COMPEL, Avon asserts
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`that Applicant “cobbled together” a declaratory judgment complaint. Avon goes on to
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`contradict this very assertion on page 3 of its MOTION TO COMPEL when it implies
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`that Applicant stalled out the settlement negotiations in bad faith for several weeks and
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`used this time to prepare a declaratory judgment complaint. Additionally, Avon asserts
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`that Applicant’s attempts at settlement negotiation were “a ruse”; however, Avon
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`conveniently fails to account for their role in the final breakdown in negotiations, just
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`prior to the filing of the civil action, which resulted due to Avon’s attempted
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`overreaching in the proposed settlement terms, as discussed above.
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`Avon’s disingenuous and inconsistent statements are illustrative of Avon's use of
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`rhetoric to disguise its real goal in bringing this MOTION TO COMPEL — to thwart
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`judicial economy and needlessly prolong the TTAB proceedings despite the proper forum
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`for these trademark disputes resting in the District Court. The Board should recognize
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`Avon’s actions for the oppressive tactics that they are, and reject its MOTION TO
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`COMPEL outright.
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`B.
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`APPLICANT DENIED AVON'S CONTINUED DISCOVERY
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`DEMANDS IN GOOD FAITH ANTICIPATION THAT THE
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`BOARD WOULD SUSPEND THE TTAB PROCEEDINGS
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`Applicant filed his declaratory relief action in the District Court on March 24,
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`2005, before discovery responses were due in this matter or in any of the related TTAB
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`proceedings. Applicant then properly filed a MOTION TO SUSPEND PROCEEDING
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`PENDING CIVIL ACTION on March 28, 2005, again prior to the close of the discovery
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`period. Applicant, legitimately concerned about duplication of discovery efforts and the
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`waste of resources that would occur in multiple discovery responses in multiple forums,
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`rejected Avon’s continued attempts at oppressive and wasteful discovery demands based
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`upon Applicant’s good faith anticipation of the Board’s favorable ruling on his MOTION
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`TO SUSPEND. As the Board is aware, such a favorable ruling would suspend all
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`deadlines in the opposition matters, including the deadlines for the discovery responses
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`which had not yet passed at the time of Applicant’s filing of his MOTION TO
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`SUSPEND.
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`Applicant’s reliance upon a favorable ruling from the Board on his MOTION TO
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`SUSPEND is well founded in law and in the practices of the Board. The Board is
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`authorized by law to suspend matters before it when the parties thereto become engaged
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`in litigation of issues before the Board. 37 C.F.R. § 2.ll7(a) provides that:
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`“Whenever it shall come to the attention of the Trademark Trial and
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`Appeal Board that a party or parties to a pending case are engaged in a
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`civil action. . .proceedings before the Board may be suspended until
`tern1ination of the civil action.”
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`It is the long—standing policy and practice of the Board to suspend proceedings when, ‘‘In
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`View of the fact that the issues involved in the civil action may have direct bearing upon
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`applicant's right to register its mark. . .suspension of proceedings pending final disposition
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`of the civil action [is] correct and proper.” The Other Telephone Company v. Connecticut
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`National Telephone Company, Inc., l8l USPQ 779 (Con1rPats 1974). See also Tuvache
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`Inc. v. Emilio Pricci Perfumes, International Inc. et al., 152 USPQ 574 (S.D. N.Y.
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`1967); Whopper—Burger, Inc. v. Burger King Corporation, l7l USPQ 805 (TTAB 1971).
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`In the present circumstances, Applicant is engaged in six opposition and/or
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`cancellation proceedings in the U.S. brought by Avon, as well as similar proceedings
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`brought by Avon in six foreign jurisdictions. Miller Decl. ‘J1 7 & 8. Avon’s actions in
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`these matters make clear its intention to oppressively take advantage of its extensive
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`resources to the detriment of the Applicant by forcing the Applicant to defend his marks
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`in many jurisdictions simultaneously and at great expense. Applicant’s desire to preserve
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`resources and to consolidate the U.S. trademark issues with Avon into a single action, to
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`be fully litigated and resolved with finality in federal court, should not be thwarted by
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`Avon’s attempt to unnecessarily prolong these proceedings. Further, “judicial economy
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`warrants a consolidation of issues, including those which may be presented for
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`determination by the Board or which may have a bearing on an issue before the Board,
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`into one forum vested with the authority to hear all issues presented. It is not
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`unreasonable, in such a case, that proceedings be stayed in the administrative tribunal
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`pending the final disposition of issues by the other forum.” The Other Telephone
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`Company, at p. 782. As Applicant’s District Court complaint consolidates all of the
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`trademark issues presently before the Board in this, and the related, TTAB proceedings,
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`and since adjudication in the District Court will be dispositive of these issues, suspension
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`of the current TTAB proceedings pending the outcome of the civil action is appropriate
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`and properly anticipated by Applicant in good faith. Miller Decl. ‘H 7.
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`Moreover, in upholding the Board’s sound exercise of discretion to suspend
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`proceedings pending the outcome of civil litigation, the Commissioner for Trademarks
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`has acknowledged the wastefulness of continued discovery to the parties while they wait
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`for a formal suspension ruling by the Board. In The Other Telephone Company v.
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`Connecticut National Telephone Company, Inc., l8l USPQ 779 (Con1rPats 1974), the
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`Commissioner denied a petition to vacate the Board’s order suspending TTAB
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`proceedings. In supporting the Board’s exercise of discretion to suspend the proceedings,
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`the Commissioner stated,
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`“Since a civil action had been instituted and the request for suspension had
`occurred prior to the close of opposer's testimony period it was not unreasonable
`under the circumstances for the opposer to forego moving forward and taking
`costly testimony for presentation as evidence in the opposition proceedings. If
`the civil action would, in fact, dispose of the issues currently before the Board it
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`would be an exercise in futility to pursue evidence at this time which would not
`necessarily affect the outcome of the opposition. ”
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`Id at p. 781 (emphasis added).
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`In the present case, Applicant filed his MOTION TO SUSPEND prior to the close
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`of the discovery period and he chose to forego further discovery in the TTAB
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`proceedings based entirely upon his concern over the duplication of efforts, the waste of
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`resources that would result from continued discovery in the TTAB and in the civil action,
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`and in good faith anticipation of the Board’s favorable ruling on his MOTION TO
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`SUSPEND. Further, since the issues presented for adjudication in Applicant's civil action
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`have direct bearing upon the issues before the Board, there is a present and obvious risk
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`of inconsistent judgments, and the adjudication of those issues in U.S. District Court will
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`be dispositive of the issues before the Board, the present matter is M the type of
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`circumstance contemplated by 37 C.F.R. § 2.1 l7(a) and put into practice by the Board.
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`Therefore, a ruling in favor of Avon's MOTION TO COMPEL would in fact be
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`duplicative and wasteful to the parties and to the Board, and it would inconsistently stand
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`against the intent and prior application by the Board of 37 C.F.R. § 2.1 l7(a) and
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`Trademark Trial and Appeal Board Manual of Procedure (“TBMP”) § 510.02.
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`Moreover, in light of the authority for suspension of TTAB proceedings pending the
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`outcome of civil litigation, there is no basis for sanctions against Applicant for
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`Applicant's failure to respond to discovery requests from Avon after filing a procedurally
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`proper motion to suspend the TTAB proceedings.
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`III.
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`CONCLUSION
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`The long—standing policy of the Board, well— grounded in law and practice, and the
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`principles of judicial economy dictate a ruling by the Board in favor of Applicant’s
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`MOTION TO SUSPEND PROCEEDINGS PENDING CIVIL ACTION. As it is both
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`reasonable and appropriate under these circumstances for the Applicant to forego
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`wasteful and duplicative discovery requests while awaiting formal action from the Board
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`on his MOTION TO SUSPEND, Avon's MOTION TO COMPEL DISCOVERY AND
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`FOR DISCOVERY SANCTIONS is disingenuous in its assertions and inappropriate at
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`///
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`///
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`///
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`this stage of the proceedings. AVon’s MOTION TO COMPEL DISCOVERY AND FOR
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`DISCOVERY SANCTIONS should be flatly rejected by the Board following the Board’s
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`favorable ruling on Applicant’s MOTION TO SUSPEND.
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`DATED: June 1, 2005
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`By:
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`/Wesley T. Miller/
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`Wesley T. Miller
`Attorney for Applicant Dean L. Rhoades
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`CERTIFICATE OF SERVICE
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`It is hereby certified that a true copy of the within APPLICANT’S RESPONSE
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`TO OPPOSER’S OPPOSITION MOTION TO SUSPEND PROCEEDING PENDING
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`CIVIL ACTION was served Via first class mail upon the Opposer by depositing a copy
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`thereof in the mail, postage prepaid, directed to MICHELLE GRAHAM, KELLEY
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`DRYE & WARREN, LLP, l0l PARK AVENUE, NEW YORK, NY l0l78, this lst day
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`of June, 2005.
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`/Wesley T. Miller/
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`Wesley T. Miller
`Attorney for Applicant Dean L. Rhoades
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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`Opposition No. 91160985
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`Avon Products, Inc.,
`
`Opposer,
`
`V.
`
`Rhoades, Dean L.,
`
`Applicant
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`\_/\_/\_/\_/\_/\_/\_/\_/\_/
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`DECLARATION OF WESLEY T. MILLER
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`I, Wesley T. Miller, hereby state and declare as follows:
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`1.
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`I am the Attorney of Record and counsel for the APPLICANT in the
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`aboVe—captioned action before the Trademark Trial and Appeal Board of
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`the U.S. Patent and Trademark Office. The facts stated in this Declaration
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`are of my own personal knowledge, or based upon information and
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`documents to which I have access in the course of my representation of
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`Applicant. I make this Declaration in support of APPLICANT’S
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`OPPOSITION TO OPPOSER'S MOTION TO COMPEL DISCOVERY
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`AND FOR DISCOVERY SANCTIONS.
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`2.
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`Applicant Dean L. Rhoades and his related company DermaNew, Inc.
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`(collectively, "DermaNew"), filed a complaint in the United States District
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`Court for the Central District of California for declaratory relief on March
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`24, 2005, requesting a judgment of non—infringement of AVon’s “ANEW”
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`marks and to establish the right to register Applicant's marks with the
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`USPTO. The complaint requested said judgment for the marks
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`“DERMANEW”, “KERANEW”, “GEMANEW”, “DERMANEW
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`INSTITUTE”, “IF IT IS NOT DERMANEW, IT IS NOT PERSONAL
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`MICRODERMABRASION”, and “DERMANEW PALM
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`MICRODERMABRASION SYSTEM”, amongst others, and collectively
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`referred to hereafter as the “DermaNew marks”. All of these marks are
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`currently at issue in these TTAB proceedings.
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`Prior to the filing of the above—mentioned complaint on March 24, 2005, a
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`conference call was held between attorneys for Avon Products, Inc.
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`(“Avon”), and counsel for Applicant Dean L. Rhoades. Participants in that
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`conference call were: John Bergin, in—house counsel for Avon; Michelle
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`M. Graham, outside counsel for Avon; Christine Lofgren, outside counsel
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`for Applicant Dean L. Rhoades and DerrnaNew, Inc.; and me, Wesley T.
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`Miller, in—house counsel for Applicant Dean L. Rhoades and DerrnaNew,
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`Inc.
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`Prior to the March 24, 2005, conference call, the parties had been
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`negotiating with a view toward the settlement of their trademark disputes
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`on a worldwide basis.
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`On March 24, 2005, counsel for Applicant (Christine Lofgren and Wesley
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`T. Miller) communicated to counsel for Avon that Avon had requested
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`terms that were overreaching and oppressive to Applicant, unrelated to the
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`parties’ trademark dispute, and therefore unacceptable to Applicant. John
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`Bergin, in—house counsel for Avon, then declared that our settlement
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`negotiations were “at an impasse.” Mr. Bergin went on to state that Avon
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`would not give up its “right to damages” in a settlement of the trademark
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`dispute without Applicant’s acquiescence to the unrelated terms demanded
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`by Avon. Mr. Bergin terminated the conference call after stating that he
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`wanted to privately confer with Avon’s attorneys to “examine their
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`options.”
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`On information and belief, Applicant Dean L. Rhoades has been under the
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`implicit threat of litigation with Avon for trademark infringement since the
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`inception of these opposition proceedings, and he has been under the
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`explicit threat of litigation from Avon since at least September of 2003,
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`following a face—to—face meeting with Avon’s in—house counsel, John
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`Bergin, during which Mr. Bergin repeatedly and explicitly threatened to
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`sue Mr. Rhoades for trademark infringement for use of the marks at issue.
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`Avon has filed six opposition and/or cancellation actions in the United
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`States Patent and Trademark Trial and Appeals Board ("TTAB") related to
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`the “DermaNew” marks, all of which are at issue in the pending Civil
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`Action filed by Applicant and DermaNew, Inc.
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`Avon has additionally filed and/or has pending filings for opposition or
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`cancellation actions related to the “DermaNew” marks in at least six
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`foreign jurisdictions, including: the European Community, Israel, Brazil,
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`Canada, Hong Kong, and South Korea.
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`9.
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`At the time Applicant experienced changes in its counsel of record in the
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`TTAB proceedings, there were no pending discovery requests served by
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`Avon.
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`I declare under penalty of perjury under the laws of the United States that the foregoing is
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`true and correct. Executed in Aliso Viejo, California, this lst day of June, 2005.
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`/Wesley T. Miller/
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`Wesley T. Miller
`Attorney for APPLICANT Dean L. Rhoades
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