313.04    Compulsory Counterclaims

37 CFR § 2.106(b)(2)(i) A defense attacking the validity of any one or more of the registrations pleaded in the opposition shall be a compulsory counterclaim if grounds for such counterclaim exist at the time when the answer is filed. If grounds for a counterclaim are known to the applicant when the answer to the opposition is filed, the counterclaim shall be pleaded with or as part of the answer. If grounds for a counterclaim are learned during the course of the opposition proceeding, the counterclaim shall be pleaded promptly after the grounds therefor are learned. A counterclaim need not be filed if it is the subject of another proceeding between the same parties or anyone in privity therewith.

37 CFR § 2.114(b)(2)(i) A defense attacking the validity of any one or more of the registrations pleaded in the petition shall be a compulsory counterclaim if grounds for such counterclaim exist at the time when the answer is filed. If grounds for a counterclaim are known to respondent when the answer to the petition is filed, the counterclaim shall be pleaded with or as part of the answer. If grounds for a counterclaim are learned during the course of the cancellation proceeding, the counterclaim shall be pleaded promptly after the grounds therefor are learned. A counterclaim need not be filed if it is the subject of another proceeding between the same parties or anyone in privity therewith.

Counterclaims for cancellation of pleaded registrations in Board proceedings are governed by 37 CFR § 2.106(b)(2)(i)  and 37 CFR § 2.114(b)(2)(i) . [ Note 1.] If the defendant knows the grounds for a counterclaim to cancel a pleaded registration when the answer is filed, the counterclaim must be pleaded with or as part of the answer. [ Note 2.] If grounds are learned during the course of the proceeding, through discovery or otherwise, the counterclaim must be pleaded promptly after the grounds therefor are learned. [ Note 3.]

A defendant who fails to timely plead a compulsory counterclaim cannot avoid the effect of its failure by thereafter asserting the counterclaim grounds in a separate petition to cancel. In such a case, the separate petition will be dismissed, on motion, on the ground that the substance of the petition constitutes a compulsory counterclaim in another proceeding, and that it was not timely asserted. [ Note 4.]

If a defendant confronted with a motion for summary judgment knows of grounds for a counterclaim that might serve to defeat the motion, the counterclaim should be asserted in response to the motion, even if no answer to the complaint has yet been filed. [ Note 5.]

A plaintiff which fails to plead a registration, and later seeks to rely thereon, will not be heard to contend, if defendant then moves to amend its answer to assert a counterclaim to cancel the registration, or then files a separate petition to cancel the registration, that the counterclaim or separate petition is untimely because it was not pleaded when defendant filed its answer. A plaintiff may not, by failing to plead a registration on which it intends to rely, deprive a defendant of its right to petition to cancel the registration, either by counterclaim or by separate petition, at such time as opposer seeks to rely upon the registration. Even if the defendant knows grounds for cancellation of a plaintiff’s unpleaded registration when the defendant files its answer, the defendant is under no compulsion to seek to cancel the registration unless and until the plaintiff pleads the registration. [ Note 6.]

NOTES:

 1.   See 37 CFR § 2.106(b)(2)(i)  and 37 CFR § 2.114(b)(2)(i) . See also TBC Corp. v. Grand Prix Ltd., 12 USPQ2d 1311, 1313 (TTAB 1989) (although parties referred to the "when justice requires" element of Fed. R. Civ. P. 13(f), counterclaims to cancel pleaded registrations in oppositions are governed by 37 CFR § 2.106(b)(2)(i). But see See’s Candy Shops Inc. v. Campbell Soup Co., 12 USPQ2d 1395, 1397 (TTAB 1989) (Board applied Fed. R. Civ. P. 13(f) "when justice requires" standard where grounds for counterclaim filed as a separate petition to cancel were known at time of answer to opposition). Please Note: Effective December 1, 2009, Fed. R. Civ. P. 13(f) was abrogated as being redundant of Fed. R. Civ. P. 15(a)(2). That section still holds that leave should be freely given "when justice so requires."

 2.   See Vitaline Corp. v. General Mills Inc., 891 F.2d 273, 13 USPQ2d 1172, 1174 (Fed. Cir. 1989); TBC Corp. v. Grand Prix Ltd., 12 USPQ2d 1311, 1314 (TTAB 1989) (since it was unclear from applicant’s submissions to amend whether counterclaim was timely, i.e., whether grounds were known by applicant at time original answer was filed, applicant was allowed time to explain why it was not pleaded with answer); S & L Acquisition Co. v. Helene Arpels Inc., 9 USPQ2d 1221, 1224 (TTAB 1987) (motion to amend answer to add additional ground to existing counterclaim denied since such ground was available at time of original answer); Consolidated Foods Corp. v. Big Red, Inc., 231 USPQ 744, 746 (TTAB 1986) (petitioner cannot avoid effect of its failure to timely assert counterclaim at time it filed its answer as defendant in prior opposition since grounds existed and were known to petitioner at that time). But see See’s Candy Shops Inc. v. Campbell Soup Co.,12 USPQ 1395, 1397 (TTAB 1989) (although counterclaim [filed as separate petition to cancel] was premised on facts known by applicant at time it filed its answer in the opposition, Board allowed the petition to go forward, notwithstanding that the petition was filed two weeks after answer was filed in the opposition).

 3.   See VitalineCorp. v. General Mills Inc., 891 F.2d 273, 13 USPQ2d 1172, 1174 (Fed. Cir. 1989); Zanella Ltd. v. Nordstrom Inc., 90 USPQ2d 1758, 1759 (TTAB 2008) (motion to amend answer to assert counterclaim granted); Turbo Sportswear Inc. v. Marmot Mountain Ltd., 77 USPQ2d 1152, 1155 (TTAB 2005) (motion to amend answer to assert counterclaim granted);Libertyville Saddle Shop Inc. v. E. Jeffries & Sons Ltd., 22 USPQ2d 1594, 1597 (TTAB 1992) (petitioner permitted to brief and present evidence on the issue of whether he had prior knowledge of the facts forming the basis of the newly-asserted counterclaim for cancellation), counterclaim dismissed, 24 USPQ2d 1376 (TTAB 1992); Marshall Field & Co. v. Mrs. Fields Cookies, 11 USPQ2d 1355, 1359 (TTAB 1989) (counterclaim pleaded promptly after obtaining the information necessary to assert counterclaim during discovery and before discovery had closed); S & L Acquisition Co. v. Helene Arpels Inc., 9 USPQ2d 1221 (TTAB 1987); M. Aron Corp. v. Remington Products, Inc., 222 USPQ 93, 96 (TTAB 1984). See also J.B. Williams Co. v. Pepsodent G.m.b.H., 188 USPQ 577, 579 (TTAB 1975) (if applicant learns through discovery that grounds exist for counterclaim, applicant may move to amend answer to assert such counterclaim); Johnson & Johnson v. Rexall Drug Co., 186 USPQ 167, 170 (TTAB 1975) (applicant would not be barred by the dismissal with prejudice of its counterclaim in prior proceeding thirteen years earlier from asserting new counterclaim on same ground, i.e., that registered mark has become common descriptive name of identified goods, provided new counterclaim is based solely on circumstances occurring subsequent to termination of prior proceeding); Neville Chemical Co. v. Lubrizol Corp., 183 USPQ 184, 187 (TTAB 1974) (same).

 4.   See Vitaline Corp. v. General Mills Inc., 891 F.2d 273, 13 USPQ2d 1172, 1174 (Fed. Cir. 1989) (Trademark Rule requiring the pleading of compulsory counterclaims was "clearly violated" by an assertion of a claim not as a counterclaim in the original proceeding but as a "purportedly new claim in a separate [cancellation] proceeding"); Consolidated Foods Corp.v. Big Red, Inc., 231 USPQ 744, 746 (TTAB 1986) (failure to seasonably assert a compulsory counterclaim in opposition cannot be avoided by filing a petition to cancel).

 5.   See Libertyville Saddle Shop Inc. v. E. Jeffries & Sons Ltd,22 USPQ2d 1594 (TTAB 1992)summ. judgment granted, 24 USPQ2d 1376 (TTAB 1992).

 6.   See 37 CFR § 2.106(b)(2)(i)  and 37 CFR § 2.114(b)(2)(i); M. Aron Corp. v. Remington Products, Inc., 222 USPQ 93, 95-96 (TTAB 1984). See also Notice of Final Rulemaking, 46 Fed. Reg. 6940 (January 22, 1981).