First Implementation of Trademark Modernization Act Rules Provides More Tools For Brand Owners to Remove Unused and Improper Registration of Competitors
On December 18, 2021, the United States Patent and Trademark Office (“USPTO”) implemented the first set of rules for the Trademark Modernization Act of 2020 (the “TMA”). The TMA will help businesses remove registrations of trademarks where the registrant has not used the mark on the goods and services in United States commerce. Prior to the implementation of the new rules, a business faced a longer and more complicated process if they wanted to clear potentially blocking registrations. Consequently, many businesses may abandon or change branding strategies rather than try to challenge improper registrations by competitors.
The US trademark registry should provide an efficient means to allow marketing departments to make decisions about the brands they develop for goods and services. Prior to expending large sums on marketing and risking potential infringement contests with other enterprises, the business could search the registry to see if their brand, or consumingly similar brands, have already been registered by another company. Unfortunately, in recent years, the USPTO has had a flood of new registrations. In many of these cases, applicants have listed more goods and services than they actually use in commerce. While the USPTO requires the applicant to submit a specimen of the mark as it has been used in commerce, only 1 specimen is required per international class. Thus, many applications proceed to registration listing goods that haven’t yet had any use of the applied-for trademark in international commerce. In extreme cases, the new registration may not ever use the registered marks on those goods and services. While the USPTO does have a process to audit certain registrations that list multiple goods in multiple international classifications, or a large number of goods in 1 international class, that process may not occur until years after registration, if at all.
Often a competing business knows that the current registrant hasn’t used the mark on those goods and services. Prior to the TMA, if a company wanted to remove this improper registration, the company would need to initiate a contested proceeding involving both themselves and the existing registrant. These proceedings would often be long and expensive. Additionally, the careless use of the proceeding might also impact the company’s ability to make other challenges against the registrant’s trademark. The TMA allows the company two new tools to remove these proceedings: an expungement proceeding and a re-examination proceeding.
An expungement proceeding allows a party to remove registrations for goods and services when an applicant has never used the goods and services. Until December 27, 2023, the expungement proceeding is available for any registration that is at least three years old. After December 27, 2023, the procedure will be available for registrations that are between three and ten years old.
The re-examination proceeding allows a party to challenge a party to remove a registration when a party hasn’t been used before a specific date. More specifically, if a registrant’s original application alleged the applicant had already used the mark in commerce, a re-examination proceeding would succeed if the applicant did not use the mark prior to the application date. If instead the registrant’s original application was based on an “intent to use” the mark, the re-examination proceeding would succeed if there wasn’t use before the later of: (a) when the application was amended to allege use or (b) the deadline date for the filing of the statement of use.
Before a company can file either of these proceedings, they must conduct a reasonable investigation to determine the use of the mark by the registrant on the contested goods and services. When submitting the application, a party will have to provide evidence to prove their contention, attest that they have conducted the investigation, and pay a fee. Thereafter, the proceeding will largely proceed “ex parte”; that is the petitioner’s involvement will be minimized. They will not have to be involved in the contest at every step. Instead, a trademark examiner will review the evidence submitted. If the examiner does not believe there is enough evidence, the examiner will provide an opportunity for the petitioner to supplement their petition. If the examiner believes the petitioner has provided enough evidence, the proceeding will then take place largely between the examiner and the registrant. The original petitioner will be informed of the final result and have an opportunity to appeal an examiner’s finding, but they will not have to be involved with the back-and-forth between the examiner and the registrant.
The reduced overhead for challengers should lead to more challenges. While this may result in company’s abusing the new procedures to harass or initiate procedures in bad faith, the net result should be less improper registrations on the trademark register. The USPTO will monitor and likely implement future regulations to discourage abuse of the new procedures; however, companies should find these new tools will help clear the way to implementing new branding campaigns.
The TMA has other components, and some will not be implemented until December 2022, but the new expungement and reexamination procedures may change how you plan to choose your brands. The USPTO has a webpage that provides additional information on the TMA, which you may access at: https://www.uspto.gov/trademarks/laws/2020-modernization-act. If you have any questions on the use or availability of this new proceeding, or you have concerns about any of your existing registrations, please feel free to contact our office.