Groq, Inc. v. Groq Health, Inc.

Background

Groq, Inc. brought trademark-infringement and related claims against Groq Health, Inc. and Florence D. Comite, M.D. The defendants asserted counterclaims and affirmative defenses. The two counterclaims at issue sought declaratory relief concerning Groq’s pending intent-to-use application to register the mark “GROQHEALTH.” The defendants asked the court to determine that Groq lacked a bona fide, or genuine, intention to use the mark and to direct the U.S. Patent and Trademark Office to refuse or otherwise reject the application.

Groq moved to dismiss those two counterclaims under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). Groq also moved under Rule 12(f) to strike the defendants’ Second Affirmative Defense, which asserted that Groq’s claims were barred in part because Groq lacked a bona fide intent to use GROQHEALTH when it filed the application.

Court’s Analysis

The court held that Section 37 of the Lanham Act, 15 U.S.C. § 1119, does not authorize a federal district court to adjudicate a pending trademark application in the first instance or direct the Patent and Trademark Office to cancel or refuse it. The court focused on Section 37’s references to a “registered mark,” cancellation of “registrations,” and correction of the trademark register. In the court’s view, those provisions concern marks that have already been registered, not applications that remain pending.

The court also relied on the Lanham Act’s separate process for the Patent and Trademark Office to examine applications, issue refusals, accept replies or amendments, and receive oppositions. After the agency reaches a final decision, the statute provides routes for administrative and judicial review. The court declined to follow a contrary Ninth Circuit decision that had permitted a district court to consider a challenge to a pending application in a trademark-infringement case.

The court further held that describing the requests as declaratory-judgment claims did not change the result. A declaratory judgment must rest on a valid underlying legal basis, and the Declaratory Judgment Act does not independently give a federal court subject-matter jurisdiction or authority to decide the pending application in this setting.

Rulings

The court granted Groq’s motion to dismiss the defendants’ Second and Third Counterclaims. The opinion states that the court lacked authority to grant the requested relief and that the counterclaims therefore had to be dismissed; it does not add a with-prejudice or without-prejudice designation.

The court denied Groq’s motion to strike the Second Affirmative Defense. It concluded that the defendants could present their argument that Groq lacked a bona fide intention to use GROQHEALTH or otherwise engage in healthcare applications. The order did not decide Groq’s underlying trademark-infringement claims, and the court stated that it would address discovery in a separate order. Judge Mary Kay Vyskocil signed the opinion and order.