TTAB Proceeding

Undeterred, Virgin issued a Rule 30(b)(6) subpoena from the District Court for the Eastern District of Virginia and served it on the lawyer named in the '1051(e) designation. The subpoena directed RG to produce for deposition in the Eastern District of Virginia 'the person having [the] most knowledge' as to various subjects including'[t]he factual allegations made in [RG's] Application.' 35 U.S.C. '24 provides authority for a district court, in any contested case in the Patent and Trademark Office, to issue a subpoena for 'any witness residing or being within such district,' commanding him to appear and testify [at an oral deposition]. RG moved the Eastern District of Virginia court to quash the subpoena under Rule 45(c)(3)(A) arguing: a) that the statute did not provide authority for the court to require a foreign resident to appear in the district for a deposition, and b) that service of the subpoena on the lawyer was ineffective.

The District Court's Ruling

The district court initially ruled that the subpoena was proper under '24 and that service on the attorney was effective. It ordered RG 'to designate a Rule 30(b)(6) witness residing or being within this judicial district to appear for deposition.' On the appointed day, RG's counsel appeared and announced that RG did not have a witness ready to testify on its behalf because there was no person 'residing or being' within the Eastern District of Virginia. VE then asked the court to compel RG to obey the subpoena, which the court had already found valid and effectively served. RG resisted, arguing that all its potential Rule 30(b)(6) designees were foreign citizens residing outside the United States and that RG, which had not conducted business in the United States, was not subject to the court's jurisdiction. It further argued that '24 applied only to natural person witnesses, and not to corporations. This time the district court agreed, holding that 'witness' in the statute covered only natural persons. VE appealed to the Fourth Circuit.

The Fourth Circuit's Decision

The Fourth Circuit noted that although the TTAB itself lacked subpoena authority to compel witnesses to testify, the purpose of '24 was to provide that authority so that district courts could assist the administrative functions of the PTO by issuing and enforcing subpoenas in connection with the preparation of evidence. Frilette v. Kimberlin, 508 F.2d 205, 207 (3d Cir. 1975) (en banc).

The Fourth Circuit first held that 'witness' as used in '24 is not limited to natural persons, but includes corporate entities. The TTAB rules generally incorporate the deposition procedures of the Federal Rules of Civil Procedure, including Rule 30(b)(6). Rule 45 requires the 'person' named in a subpoena to attend and give testimony, and it is well established that this applies to corporations. Fed. R. Civ. P. 45(a)(1)(c), 30(a)(1), see, e.g., Yousuf v. Samantar, 451 F.3d 248, 257 (D.C. Cir. 2006). Moreover, foreign corporations are frequently required under the federal rules to submit to Rule 30(b)(6) depositions, even if the designated representatives all reside outside the United States. Custom Form Mfg., Inc. v. Omron Corp., 196 F.R.D. 333, 336 (N.D. Ind. 2000); In re Honda Am. Motor Co. Dealership Relations Litig, 168 F.R.D. 535, 540-42 (D. Md. 1996). Thus, '24 covers both corporations and natural persons within the meaning of 'witness' and because Rule 30(b)(6) is a proper way of compelling a corporation to testify, it can be used under '24. If, the Fourth Circuit held, the corporation is properly subject to subpoena under the statute, the residences of the designated representatives are immaterial.

The Fourth Circuit, therefore, considered whether RG was properly subject to subpoena under '24 as 'residing or being within' the district. The TTAB construes '24 as requiring that the deponent 'reside or is regularly employed' in the district in which the subpoena is issued. TBMP '703.01(f)(2). The Fourth Circuit, however, focused on the 'or being within' language of the statute. The court understood RG's argument to be that the 'residing or being within' standard is equivalent to the 'continuous and systematic contacts' required for a court to exercise general jurisdiction over a party. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984). However, it held that RG had not preserved this as an argument on appeal because it had not appealed the district court's initial ruling that the subpoena was valid. Thus, the Fourth Circuit did not need to determine the parameters of the 'residing or being' element of the statute. It did, however, remark in a footnote that if the issue were before it, it would conclude that RG's activities were sufficient for it to be considered as 'being within [the] district.' 511 F.3d at 446, n 5.

RG relied on the TBMP as authority for its argument that a foreign witness in a TTAB proceeding cannot be compelled by subpoena, only by the letters rogatory procedure or The Hague Convention letter of request procedure. TBMP '703.01(f)(3). The court was unimpressed, observing that the TBMP provides basic information for practitioners and does not 'modify, amend, or serve as substitute for any statutes, rules, or decisional law and is not binding upon the TTAB.' The court designated the cited provision as 'the TTAB's informal opinion that the statute does not provide authority for a district court to issue a subpoena to an unwilling foreign deponent.' The court noted that it was not 'obligated to consider [the TTAB's] statutory interpretation particularly persuasive.'

The Dissent

The majority opinion was subject to a strong dissent that sees the decision as a major expansion of the scope of discovery, subjecting, for the first time, foreign companies to the requirement that they provide oral depositions in the United States as a price for filing a trademark application.

The dissent first agreed that 'witness' in '24 covers corporations, but took issue with the finding that RG qualified as 'residing or being within' the Eastern District of Virginia. The 'residing or being' test is apparently found in few other statutes and no cases were cited as to its meaning in those contexts. The dissent considered the filing of the trademark application and the designation of the attorney as a domestic representative insufficient to support a finding of RG 'being within' the Eastern District of Virginia and would quash the subpoena on that ground. The dissent also disapproved of the decision on the grounds of comity and respect for the rights of foreign countries. Requiring a foreign corporation to shoulder the burdens, financial and other, of appearing for a deposition in the United States was viewed as disregarding international concerns and unfairly penalizing foreign applicants who want U.S. trademark registrations. These concerns, the dissent urged, should lead to a narrow interpretation of '24 to avoid creating international discord and 'unreasonably interfering with the sovereign authority of other nations.'

The dissent does not, however, explain how foreign sovereign interests are interfered with or why Congress should not have considered applying for a patent or trademark in the United States a sufficient basis for requiring the applicant to provide an oral deposition in inter-parties proceedings, particularly as this tool is often regarded as a most efficient mechanism for developing evidence in U.S. proceedings. See Vogel v. Jones, 443 F.2d 257 (3d Cir. 1971) (holding that the court's personal jurisdiction over a foreign party was acquired when it became party to a patent interference proceeding; filing for U.S. patent involves seeking the protection and benefits of U.S. law, and a foreign corporation may, under 28 U.S.C. '1391(a) be 'sued in any district'). The issues to be developed in future cases include the proper scope of the 'or being within' language of '24 and the significance of the appointment of a domestic representative under 15 U.S.C. '1051(e) in making service of the subpoenas on the attorney effective.

A narrow reading of '24 means that a U.S. party to a trademark opposition can be compelled to give oral deposition testimony, while a foreign adversary can refuse, leaving the U.S. party to the clearly less efficient tool of deposition on written questions and the mercy of The Hague Convention and letters rogatory.

John M. Cone is an attorney at Hitchcock Evert LLP, specializing in intellectual property. He can be contacted at [email protected].

In a proceeding before the Trademark Trial and Appeal Board ('TTAB'), if your adversary is a foreign entity with no employees in the United States, can you compel an oral deposition of the entity in this country? 'No,' says the TTAB, through its Manual of Procedure ('TBMP'). 'Yes,' says the Fourth Circuit, relying on '24 of the Patent Act, 35 U.S.C. '24 in Rosenruist-Gestao E Servicos LDA v. Virgin Enterprises Ltd., 511 F.3d 437 (4th Cir. 2007).

Virgin Enterprises ('VE'), a United Kingdom company, opposed a trademark application by Rosenruist-Gestao, a Port- uguese company ('RG'), for the mark VIRGIN GORDA for various clothing and travel accessories. RG had not used its mark in the United States, had no place of business in the United States, no employees or agents resident in the United States, and owned no U.S. property ' in fact, it
had none of the 'contacts' traditionally necessary for personal jurisdiction. RG had, however, filed a U.S. trademark application and had appointed a U.S. lawyer as its domestic representative, as encouraged by 15 U.S.C. '1051(e). The authorization empowered the attorney to prosecute the application and also to act as RG's designee 'upon whom notices or process in proceedings affecting this mark may be served.'

During its testimony period, VE asked RG to produce a Rule 30(b)(6) representative to testify on its behalf. When RG would not agree to produce a witness, VE filed a motion asking the TTAB to compel RG to produce a witness to testify at an oral deposition in Portugal. The TTAB refused. The TBMP states that an adverse party who does not agree to give a testimony deposition cannot be compelled to do so by a notice of deposition alone. Rather, attendance must be compelled. The means for compulsion is the subpoena power of a federal district court under 35 U.S.C. '24. The TBMP observes that 'there is no certain procedure for obtaining, in a Board inter-parties proceeding, the trial testimony deposition of a witness who resides in a foreign country … and is not willing to appear voluntarily to testify.' It adds, optimistically, that 'the deposing party may be able to obtain the testimony deposition of such a witness through the letters rogatory procedure or The Hague Convention letter of request procedure.' TBMP '703.01 (f)(3).

Undeterred, Virgin issued a Rule 30(b)(6) subpoena from the District Court for the Eastern District of Virginia and served it on the lawyer named in the '1051(e) designation. The subpoena directed RG to produce for deposition in the Eastern District of Virginia 'the person having [the] most knowledge' as to various subjects including'[t]he factual allegations made in [RG's] Application.' 35 U.S.C. '24 provides authority for a district court, in any contested case in the Patent and Trademark Office, to issue a subpoena for 'any witness residing or being within such district,' commanding him to appear and testify [at an oral deposition]. RG moved the Eastern District of Virginia court to quash the subpoena under Rule 45(c)(3)(A) arguing: a) that the statute did not provide authority for the court to require a foreign resident to appear in the district for a deposition, and b) that service of the subpoena on the lawyer was ineffective.

The District Court's Ruling

The district court initially ruled that the subpoena was proper under '24 and that service on the attorney was effective. It ordered RG 'to designate a Rule 30(b)(6) witness residing or being within this judicial district to appear for deposition.' On the appointed day, RG's counsel appeared and announced that RG did not have a witness ready to testify on its behalf because there was no person 'residing or being' within the Eastern District of Virginia. VE then asked the court to compel RG to obey the subpoena, which the court had already found valid and effectively served. RG resisted, arguing that all its potential Rule 30(b)(6) designees were foreign citizens residing outside the United States and that RG, which had not conducted business in the United States, was not subject to the court's jurisdiction. It further argued that '24 applied only to natural person witnesses, and not to corporations. This time the district court agreed, holding that 'witness' in the statute covered only natural persons. VE appealed to the Fourth Circuit.

The Fourth Circuit's Decision

The Fourth Circuit noted that although the TTAB itself lacked subpoena authority to compel witnesses to testify, the purpose of '24 was to provide that authority so that district courts could assist the administrative functions of the PTO by issuing and enforcing subpoenas in connection with the preparation of evidence. Frilette v. Kimberlin , 508 F.2d 205, 207 (3d Cir. 1975) ( en banc ).

The Fourth Circuit first held that 'witness' as used in '24 is not limited to natural persons, but includes corporate entities. The TTAB rules generally incorporate the deposition procedures of the Federal Rules of Civil Procedure, including Rule 30(b)(6). Rule 45 requires the 'person' named in a subpoena to attend and give testimony, and it is well established that this applies to corporations. Fed. R. Civ. P. 45(a)(1)(c), 30(a)(1), see, e.g., Yousuf v. Samantar , 451 F.3d 248, 257 (D.C. Cir. 2006). Moreover, foreign corporations are frequently required under the federal rules to submit to Rule 30(b)(6) depositions, even if the designated representatives all reside outside the United States. Custom Form Mfg., Inc. v. Omron Corp. , 196 F.R.D. 333, 336 (N.D. Ind. 2000); In re Honda Am. Motor Co. Dealership Relations Litig, 168 F.R.D. 535, 540-42 (D. Md. 1996). Thus, '24 covers both corporations and natural persons within the meaning of 'witness' and because Rule 30(b)(6) is a proper way of compelling a corporation to testify, it can be used under '24. If, the Fourth Circuit held, the corporation is properly subject to subpoena under the statute, the residences of the designated representatives are immaterial.

The Fourth Circuit, therefore, considered whether RG was properly subject to subpoena under '24 as 'residing or being within' the district. The TTAB construes '24 as requiring that the deponent 'reside or is regularly employed' in the district in which the subpoena is issued. TBMP '703.01(f)(2). The Fourth Circuit, however, focused on the 'or being within' language of the statute. The court understood RG's argument to be that the 'residing or being within' standard is equivalent to the 'continuous and systematic contacts' required for a court to exercise general jurisdiction over a party. Helicopteros Nacionales de Colombia, S.A. v. Hall , 466 U.S. 408, 416 (1984). However, it held that RG had not preserved this as an argument on appeal because it had not appealed the district court's initial ruling that the subpoena was valid. Thus, the Fourth Circuit did not need to determine the parameters of the 'residing or being' element of the statute. It did, however, remark in a footnote that if the issue were before it, it would conclude that RG's activities were sufficient for it to be considered as 'being within [the] district.' 511 F.3d at 446, n 5.

RG relied on the TBMP as authority for its argument that a foreign witness in a TTAB proceeding cannot be compelled by subpoena, only by the letters rogatory procedure or The Hague Convention letter of request procedure. TBMP '703.01(f)(3). The court was unimpressed, observing that the TBMP provides basic information for practitioners and does not 'modify, amend, or serve as substitute for any statutes, rules, or decisional law and is not binding upon the TTAB.' The court designated the cited provision as 'the TTAB's informal opinion that the statute does not provide authority for a district court to issue a subpoena to an unwilling foreign deponent.' The court noted that it was not 'obligated to consider [the TTAB's] statutory interpretation particularly persuasive.'

The Dissent

The majority opinion was subject to a strong dissent that sees the decision as a major expansion of the scope of discovery, subjecting, for the first time, foreign companies to the requirement that they provide oral depositions in the United States as a price for filing a trademark application.

The dissent first agreed that 'witness' in '24 covers corporations, but took issue with the finding that RG qualified as 'residing or being within' the Eastern District of Virginia. The 'residing or being' test is apparently found in few other statutes and no cases were cited as to its meaning in those contexts. The dissent considered the filing of the trademark application and the designation of the attorney as a domestic representative insufficient to support a finding of RG 'being within' the Eastern District of Virginia and would quash the subpoena on that ground. The dissent also disapproved of the decision on the grounds of comity and respect for the rights of foreign countries. Requiring a foreign corporation to shoulder the burdens, financial and other, of appearing for a deposition in the United States was viewed as disregarding international concerns and unfairly penalizing foreign applicants who want U.S. trademark registrations. These concerns, the dissent urged, should lead to a narrow interpretation of '24 to avoid creating international discord and 'unreasonably interfering with the sovereign authority of other nations.'

The dissent does not, however, explain how foreign sovereign interests are interfered with or why Congress should not have considered applying for a patent or trademark in the United States a sufficient basis for requiring the applicant to provide an oral deposition in inter-parties proceedings, particularly as this tool is often regarded as a most efficient mechanism for developing evidence in U.S. proceedings. See Vogel v. Jones , 443 F.2d 257 (3d Cir. 1971) (holding that the court's personal jurisdiction over a foreign party was acquired when it became party to a patent interference proceeding; filing for U.S. patent involves seeking the protection and benefits of U.S. law, and a foreign corporation may, under 28 U.S.C. '1391(a) be 'sued in any district'). The issues to be developed in future cases include the proper scope of the 'or being within' language of '24 and the significance of the appointment of a domestic representative under 15 U.S.C. '1051(e) in making service of the subpoenas on the attorney effective.

A narrow reading of '24 means that a U.S. party to a trademark opposition can be compelled to give oral deposition testimony, while a foreign adversary can refuse, leaving the U.S. party to the clearly less efficient tool of deposition on written questions and the mercy of The Hague Convention and letters rogatory.

John M. Cone is an attorney at Hitchcock Evert LLP, specializing in intellectual property. He can be contacted at [email protected].