Expunge-Examine-Ex Parte; the Trademark Office Seeks to add Arrows to its Quiver
According to a recent audit carried out by the Trademark Office and evaluating over 8000 registrations, as many as 46% of US use-based registrations were unsupported by actual use, with the percentages for Paris Convention and Madrid Protocol registrations reaching 66% and 65 respectively.
In other words, almost two-thirds of treaty-based applications arriving at the Trademark Office from outside the United States failed to meet a proof-of-use test.
For example, in late January 2018 The United States Patent and Trademark Office received a new application for federal trademark registration and assigned it an “87” series number. The application was for a mark in standard characters, and was based on a Section 44(d) filing basis (15 USC § 1126(d)); i.e., an application accepted by the USPTO under treaty obligations with reciprocating countries. (As a quirk of trademark law, practitioners tend to refer to sections of the original 1946 Lanham Act, even though their statutory citations are numbered quite differently.)
Under goods and services, the Applicant listed 115 different items (count ‘em) in International Class 03 (“bleaching preparations and other substances for laundry use; cleaning, polishing, scouring and abrasive preparations; soaps; perfumery, essential oils, cosmetics, hair lotions; dentifrices”).
Because the application was a treaty document, rather than a US use-based application, the Applicant provided neither a specimen nor any other evidence of use. Following a brief prosecution, the registration issued in February 2019.
Trademark registration, of course, carries some important benefits including (but not limited to) “prima facie evidence of the validity of the registered mark and of the registration of the mark, of the owner’s ownership of the mark, and of the owner’s exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the certificate….” (15 USC § 1057).
Hunting down the Registrant’s website (or what appears to be the Registrant’s website) took some effort and indicated that the Registrant does not even provide the goods listed in the application, but rather is a service provider who consults with manufacturers and retailers. These third parties use their own trademarks on their goods rather than the Registrant’s mark on Registrant’s goods. Thus, this registrant starts with a presumption of rights to which it may not be entitled.
So, what is a competitor to do? Respect a registration that is arguably invalid? Such undeserved respect can result in the loss of business. Obtain a clearance opinion from your intellectual property attorney? Better, but potentially expensive depending upon circumstances. File a cancellation proceeding? Useful, but drawn out and potentially expensive.
The proposed amendments to the Trademark Act Of 1946 (15 USC § 1051 et seqq.; see, H.R. 6196; congress.gov); are intended to provide relief against invalid registrations that is faster, easier, and less expensive, than litigation, opposition, or cancellation.
The amendments also add some administrative touches that should make life better all around, but that will also introduce some new docketing deadlines for practitioners.
Third Party Submissions: An amendment to current Section 1 (15 USC § 1051) will allow third parties to gain admission to a pending application and submit evidence that the legislation euphemistically refers to as "for inclusion in the record of an application…relevant to a ground for refusal of registration." In other words, "Dear Examiner the Applicant should never have been granted a registration because…." This provision requires both submitting the evidence and giving a concise explanation of the grounds for refusing registration provided by that evidence. The examining attorney is then entitled to use the information as they believe best. This amendment will take effect one year after the final bill passes
Flexible response deadlines (amendments to Section 12(b); 150USC § 1062(b)): This is an administrative touch which allows the Trademark Office to establish intermediate deadlines less than the statutory six months with appropriate extensions available (read: “pay extension fees”) in a manner analogous to extensions granted by the Patent Office. In accordance with US membership in certain treaty organizations, minimum deadlines are 60 days.
Expungement (a new Section 16A, inserted after current 15 USC § 1066): This is a substantive provision adding collateral attacks on registrations short of a full cancellation proceeding. In particular, expungement is based on a registrant’s failure to ever use the mark in commerce with some (or presumably all) of the goods and services identified in the petition to expunge (“never been used in commerce”). The attack requires both supporting evidence and a fee, following which the Office has the authority to initiate an expungement proceeding. Expungement will generally follow the examination steps for new applications, with the Director given rulemaking powers to establish potential exceptions.
A registrant can respond to expungement by documenting evidence of use, consistent with the “in commerce" requirements of 1946 Trademark Act. The registrant is also given the opportunity to show some excusable nonuse.
Once the expungement evaluation has been completed, the examiner has the right to cancel the registration for any goods or services for which the owner cannot establish use in commerce.
The Director can also start such an expungement proceeding on his or her own initiative.
In each case, however, an expungement proceeding cannot be initiated until three years following the date of registration. This provides both docketing obligations and marketing opportunities for practitioners because it would presumably be a practitioner’s responsibility to remind clients that if they had included numerous goods and services in their application and registration, they will need to show such use for all of those specific items.
Ex Parte Reexamination (and its differences from Expungement; a new Section 16B following the proposed Section 16A): At first glance, ex parte reexamination appears to track expungement, but there is an important difference. To repeat, in expungement, portions of the registration are deleted based on the fact that the mark has “never been used in commerce” on those particular goods and services.
Reexamination applies a different standard to a different situation: registrations for which the mark was not in use on the goods or services on or before “the relevant date.” Normally that “date” would be the filing date for a use-based application or the statement of use date for an intent-to-use (“ITU”) application.
As in the case of expungement, the party petitioning for re-examination needs to raise relevant arguments and submit supporting proofs, and the Director can again cancel the registration for some or all of the goods depending upon the proof presented.
The timing for re-examination, however, moves differently than expungement. In particular, once the registration reaches the five year anniversary, re-examination is no longer permitted. This of course differs from expungement which cannot be initiated until three years after registration, but presumably remains available for the lifetime of the registration.
Again, this will potentially require some additional docketing by practitioners. At a minimum, practitioners will need to docket this for their own clients, and presumably enterprising practitioners might track competitors’ registrations to give their clients an appropriate opportunity is to seek reexamination if they believe it worthwhile.
In summary, the amendments are attractive to at least the Trademark Office and competitors of registrants with flimsy factual support for their trademark claims. The Office gets to clear out the dead wood, legitimate registrants have nothing to fear, and competitors get three flanking attacks, each of which appears to be faster, easier, and less expensive than any other current option.