The USPTO Implements the Trademark Modernization Act: Considerations for Applicants, Brand Owners and Practitioners

Written By: Francelina Perdomo Klukosky

01/24/22
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Regulations recently went into effect that will make it easier to challenge existing trademark registrations, in order to cancel registrations that were obtained fraudulently or that are no longer in use. In recent years, the trademark Principal Register has been cluttered with fraudulent trademark registrations. Fraudulent applications that successfully register deplete the availability of marks for legitimate business owners. The Trademark Modernization Act of 2020 (“TMA”) was enacted to clean up the Register in a fast and cost-effective manner. The regulations implementing the TMA went into effect as of December 27, 2021.
 
The TMA amends the Lanham Act by enabling businesses, individuals and the United States Patent and Trademark Office (USPTO) to initiate ex-parte proceedings related to the validity of trademarks, restoring the rebuttable presumption of irreparable harm for owners seeking injunctions and modifying the procedural rules for letters of protest. The ex-parte proceedings will prove to be important tools during pre-registration clearance evaluations as well during trademark prosecution.
 
While the TMA provides useful tools to remove defective registrations from the federal trademark register, owners should carefully re-evaluate their portfolios. The new mechanisms, although useful to attack fraudulent applications, could present challenges to legitimate registrations.
 
What is “Use In Commerce”?
 
When a trademark application is filed, the applicant must attest that the mark is being used in commerce or that the applicant has a good faith intent to use the trademark in commerce. The definition of “use in commerce” means the use of mark in the ordinary course of trade and not merely to reserve a right in mark.
 
Any “use” application must be filed along with a sworn declaration detailing that the mark is in use and the date of first use of the mark anywhere, and the date of first use of the mark in commerce. Submitting proof to the USPTO showing that the mark is in use varies depending on whether the mark protects goods or services. If the mark protects goods, it must be displayed on the goods directly. For example, the Nike™ word or logo embedded on the sneakers or on the box used for packaging the sneakers. However, when a mark protects services an adequate statement of use will feature the mark while advertising services in commerce – websites, and social media sites offering services and engaging with customers or clients are common examples.
 
 
The Ex-Parte Proceedings
 
The TMA creates two new ex parte proceedings, expungement, and reexamination. These new proceedings allow any party to request the cancellation, in whole or in part, of a registered trademark that was not actually used in commerce when the statement of use was filed or that has never been used in commerce. These new proceedings are intended to provide a faster, more efficient, and less expensive alternative to a contested inter parties cancellation proceeding before the Trademark Trial and Appeal Board. The office action response periods are 90 days with an optional 90-day extension of time.
 
The highly anticipated regulations implementing the TMA went into effect on December 27, 2021. Petitions requesting institution of proceedings for reexamination or expungement are now being accepted through the Trademark Trial and Appeal Board (TTAB) portal. According to the U.S. Patent and Trademark Office (USPTO) “individuals, businesses, and the USPTO will now have new tools to clear away unused registered trademarks from the federal trademark register, and the USPTO will have the ability to move applications through the registration process more efficiently.” See. https://www.uspto.gov/trademarks/laws/2020-modernization-act.
 
Following is a more detailed description of the new proceedings:
 

  • The expungement proceeding allows for cancellation of registrations for marks that have never been used in commerce. Expungement is available against registrations that are over three years old if filed on or before December 27, 2023. After this date, expungement is limited to registrations that are 3 to 10 years old.
  • The re-examination proceeding allows for cancellation of registrations for marks that were never used in commerce as of the application date or deadline to file the statement of use. If the trademark application was filed on an intent to use basis, the petition must provide evidence that the trademark was not used in commerce on the date that petitioner filed the allegation of use or the date the deadline to file a statement of use expired, whichever is later.

 
The petitioner must conduct a reasonable investigation into the use of the mark. Thereafter, the petitioner can choose to request cancellation of some, or all of the goods and services listed in a registration. The registrant will have the opportunity to present evidence of use, and the USPTO will render its final decision regarding cancellation. 
 
Letters of Protest
 
Letters of Protest (LOP) are often used in practice to challenge the registrability of a pending trademark application. The procedure is valuable to the trademark application examination process without causing undue delay. The USPTO will consider letters of protest that are based on grounds such as likelihood of confusion, that the applied for trademark is merely descriptive, generic for the identified goods or services, that the mark in the application suggests a false connection with the protestor’s mark or the application includes an inappropriate specimen of use.
 
The TMA updates the procedure and refines the requirements for acceptable letters of protests. First, it provides statutory authority for the existing procedure before the USPTO. Additionally, the TMA grants authority to the Director of the USPTO in deciding whether to include evidence submitted with the LOP in the record within two months after the date of submission. Any decision to include or exclude the evidence in the record will be final and non-reviewable. However, the decision will not preclude any party from relying on that same evidence in subsequent proceedings.
 
Presumption of Irreparable Harm
 
The TMA amends the Lanham Act to reinstate this presumption for plaintiffs seeking injunctive relief. Plaintiffs will now be entitled to the presumption of irreparable harm upon a finding of likelihood of success on the merits for preliminary injunctions, or a finding of infringement in a motion for a permanent injunction. Consequently, the TMA makes it easier for trademark owners to obtain injunctive relief, particularly when monetary damages are not an adequate remedy.
 
Conclusion
 
The new TMA provisions are valuable tools in a practitioner’s arsenal to protect their clients’ portfolios, fight cease and desist letters and prosecute new applications.
 
During clearance searches, these proceedings open new possibilities in potential trademark availability. When submitting new applications and filings statements of use, applicants should consider submitting specimens of use for multiple items within each class of goods and services. Brand owners are encouraged to review their portfolios with counsel and ensure their marks are not at risk of cancellation. In some instances, the only option to cure any deficiency is by filing a new application.

about the authors

Francelina Perdomo Klukosky

Partner

Ms. Perdomo focuses her practice on intellectual property, corporate and commercial matters involving copyrights, trademarks, patents, false advertising, technology, digital media, music publishing, licensing, publicity rights, live events, table-top, and video games. Francelina represents authors, content creators and developers, music publishing, record and production companies in their ongoing business affairs. She often serves as outside general counsel to companies handling a variety of intellectual property and commercial matters.

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