527.03 Inherent Authority to Sanction
Flowing from the Board’s inherent authority to manage the cases on its docket is the inherent authority to enter sanctions against a party. [ Note 1.] The Board’s exercise of this authority is clearly permitted in a variety of situations where the conduct in question does not fall within the reach of other sanctioning provisions of the rules. [ Note 2.]
For example, when a party to an inter partes proceeding before the Board advises an adverse party that it will not take any further action in the case, the adverse party may file a motion asserting this fact and request entry of judgment in its favor. If, as is usually the case, the motion is uncontested, the Board normally will grant it. [ Note 3.]
Similarly, if a registrant (having been served by the Board with a notice of institution and a web link or web address to access a petition to cancel its registration on TTABVUE) or any other party to an inter partes proceeding before the Board, relocates, and fails to inform its attorney (if it is represented by an attorney) or the Board or any adverse party of its new address, with the result that the party cannot be found, and papers relating to the proceeding cannot be served upon it, any adverse party may file a motion asserting such fact and requesting entry of judgment in its own favor. Again, if the motion is uncontested, the Board normally will grant it. Alternatively, under these or similar circumstances indicating that a party is no longer interested in the case, the Board may, either upon motion by the adverse party or upon its own initiative, issue an order that the party show cause why the Board should not enter judgment in view of the party’s apparent loss of interest in the case. If the party files no response to the order, judgment will normally be entered. Furthermore, inasmuch as the assigned Board attorney has the authority to act upon on motions, requests, and other matters not actually or potentially dispositive of a proceeding, the assigned Board attorney has the discretion to issue sanctions addressing party conduct with respect to motions, requests, and other matters not actually or potentially dispositive of a proceeding. See 37 C.F.R. § 2.127(c).
Other circumstances involving the Board’s inherent power to sanction are set forth in the cases cited in the note below. [ Note 4.]
NOTES:
1. See Chambers v. NASCO, Inc., 501 U.S. 32, 49 (1991) (stating that this inherent power "stems from the very nature of courts and their need to be able to manage their own affairs so as to achieve the orderly and expeditious disposition of the cases") (citations omitted).
2. See Chambers v. NASCO, Inc., 501 U.S. 32, 50 (1991) (stating that "[i]f in the informed discretion of the court, neither the statute nor the Rules are up to the task, the court may safely rely on its inherent power."); NSM Resources Corp. v. Microsoft Corp., 113 USPQ2d 1029, 1038 (TTAB 2014) (entering sanction of entry of judgment for bad-faith litigation under both the Board’s inherent authority to sanction and Rule 11); HighBeam Marketing LLC v. HighBeam Research LLC, 85 USPQ2d 1902, 1906-07 (TTAB 2008) (sanction of precluding use of testimony granted where attorney ensured witness would not appear); Central Manufacturing Inc. v. Third Millennium Technology Inc., 61 USPQ2d 1210, 1215 (TTAB 2001) (applying sanction for bad-faith conduct under the Board’s inherent authority to sanction, regardless of whether sanctions available under Fed. R. Civ. P. 11); Carrini Inc. v. Carla Carini S.R.L., 57 USPQ2d 1067, 1071-72 (TTAB 2000) (opposer’s conduct did not "fall within reach" of Rule 11 but resulted in judgment under Board’s inherent power to sanction).
3. See 37 C.F.R. § 2.127(a).
4. Schering-Plough Animal Health Corp. v. Aqua Gen AS, 90 USPQ2d 1184, 1185 (TTAB 2009) (Board required party to obtain permission before filing any unconsented or unstipulated motion); International Finance Corp. v. Bravo Co., 64 USPQ2d 1597, 1604 n.23 (TTAB 2002) (following opposer’s third motion to compel, Board prohibited opposer from filing any further motions to compel without prior Board permission); Central Manufacturing Inc. v. Third Millennium Technology, Inc., 61 USPQ2d 1210, 1212-13 (TTAB 2001) (extensions of time based on false allegations of continuing settlement negotiations resulted in imposition of continuing sanctions in future cases); Carrini Inc. v. Carla Carini S.R.L., 57 USPQ2d 1067, 1071-72 (TTAB 2000) (opposer’s "callous disregard for Board orders and ignorance of warnings" including violation of order prohibiting filing of any further papers without prior leave, resulted in order dismissing opposition without prejudice, and holding opposed application abandoned without prejudice); Johnston Pump/General Valve Inc. v. Chromalloy American Corp., 13 USPQ2d 1719, 1721 n.4 (TTAB 1989) (opposer’s counsel warned that Board would not tolerate any further "game playing" or evasiveness in discovery). Cf. Thrifty Corp. v. Bomax Enterprises, 228 USPQ 62, 63 n.2 (TTAB 1985) (Board, while noting that it did not condone applicant’s repeated failure to comply with the requirements of 37 C.F.R. § 2.119(a) and 37 C.F.R. § 2.119(b) found that, in absence of any prejudice to opposer, such conduct did not justify the harsh result of entry of default judgment).