By Matthew J. Clark,
This article originally appeared on the IndyBar Intellectual Property Section webpage. Check out even more news and resources from the section at indybar.org/ip.
Trademark practitioners will tell you the U.S. Trademark Office has a deadwood problem – and they do not mean the Trademark Office has an addiction to watching the HBO television series. Rather, the Trademark Office’s register is full of registrations for trademarks no longer in use (or in the case of some, never used) and no longer entitled to registration, often referred to as “deadwood registrations.” Fortunately, the Trademark Office has been listening and is developing strategies to help remove deadwood.
In order to obtain a trademark registration, the applied-for mark cannot be confusingly similar to a prior registration. If a registration suspected of being deadwood is cited as a block to a mark’s application, the only way to actively remove it is to file a petition to cancel the registration with the Trademark Trial and Appeal Board (“TTAB”). U.S. cancellation proceedings function much like a lawsuit in federal court. In fact, the Federal Rules of Civil Procedure govern them. Accordingly, proceedings are initiated with a complaint-like petition to which a respondent must answer, parties engage in full discovery and motion practice, and the proceedings conclude with a trial period for briefing and oral arguments. Cancellations can be costly and take years to finish. As a result, trademark applicants are apt to either abandon the registration process altogether or try to develop a new mark as opposed to engaging in a cancellation. But with over two million active trademark registrations on file in the U.S., clearing a new mark for registration is increasingly getting more difficult.
Thus, in an effort to maintain a more accurate registry of active trademark registrations, the Trademark Office is proposing a new streamlined cancellation proceeding intended to be more efficient and cost-effective than a full-blown cancellation proceeding. The clear hope, in part, is to incentivize applicants to cancel suspected deadwood registrations.
The accelerated cancellation process would only have two available grounds for cancellation – abandonment and nonuse. In addition, the proposed process would require that evidence be submitted with the pleadings and would only allow, upon motion, limited discovery solely for the issue of standing. Moreover, the proceedings would have no oral hearings and would not allow respondents to assert counterclaims.
To initiate, a petitioner would be required to set forth facts establishing its standing and set forth with particularity the factual basis for the ground or grounds asserted as the basis for the cancellation. As noted above, the petitioner would need to provide evidence supporting both its standing and grounds for cancellation. For example, the Trademark Office suggests that a petitioner could provide a declaration describing its search for use of the mark and the results of the search. The proposed petition fee is $300 per class of goods/services when filing electronically and $400 per class of goods/services when filing by paper.
A respondent would have 40 days to answer the petition with only one opportunity to extend this deadline. In addition to admitting or denying allegations in the petition and stating any applicable defenses, a respondent would need to provide evidence of use and evidence to support any pleaded defenses. After reviewing the answer and submitted evidence, a petitioner would have 40 days to either (1) reply and provide any rebuttal evidence, (2) withdraw the petition without prejudice to its right to file another cancellation proceeding on grounds other than the grounds raised in the initial petition, or (3) convert the streamlined proceeding into a full cancellation proceeding with the appropriate fee and any proposed amendment to the petition to cancel.
While a respondent would not have the ability to convert the streamlined proceeding into a full cancellation proceeding, both parties would retain the right to seek judicial review of the TTAB decision in a streamlined proceeding.
The expedited procedure should allow for quicker resolutions. The Trademark Office predicts that the entire proceeding could conclude in approximately 70 days where a respondent does not respond to the petition and 170 days where a respondent does respond to the petition.
The proposed streamlined proceeding would be akin to expungement proceedings in Canada, which allows interested third parties to challenge a mark that has been registered for at least three years on nonuse grounds. Like the Trademark Office’s proposed proceeding, a respondent in an expungement proceeding must provide evidence of use of the mark with all of the goods/services identified in the registration at any time during the three-year period immediately preceding the notice of expungement. If no evidence is submitted, the registration is expunged. If evidence is lacking only in respect to certain goods/services, then the registration is maintained but amended to delete those goods/services that lack evidence of use. Various other countries have similar processes as well.
The Trademark Office is seeking public comment on the proposed streamlined proceeding by Aug. 14, 2017. If the proposed system is implemented, mark owners will want to consult with trademark practitioners to reassess those marks previously unregistrable, or thought to be unregistrable, as well as for developing strategies for maintaining evidence of use for existing active registrations.•