The Trademark Modernization Act of 2020 (TMA) introduced several amendments to federal trademark statutes, known as the Lanham Act, that should prove favorable to brand owners when the TMA becomes effective on Dec. 27.
Hargis
There has been much written of late about trademark depletion or congestion theories, which suggest there are only so many words and that all of the “good” words/marks are taken. With more than 2 million marks on the federal register, the suggestion seems plausible. This is particularly true if you are a business owner on a budget. Maybe you have worked with a creative group to identify the perfect mark, only to receive a less than favorable clearance report declaring your mark too similar to another’s registered mark. What if the report also suggests that the similar registered or blocking mark appears to be no longer in use?
How can this be? Registration owners, or registrants, are required to submit a declaration and proof of continued use of their mark to the U.S. Patent and Trademark Office (USPTO) between the fifth and sixth years after registration, again at the 10th year, and every 10 years thereafter. A goal of these requirements is to rid the register of unused marks so others can use them. Under this system, however, an unused blocking mark can remain on the register for nearly a decade.
What can you do? Prior to the TMA, your options for overcoming such a scenario were limited. You could abandon the perfect mark or petition the Trademark Trial and Appeal Board to cancel the registration for the blocking mark. Neither were good options, and the latter could add significant cost to your brand development endeavors.
Thankfully, the TMA offers two additional tools designed to simplify the removal of such blocking marks. The first is ex parte reexamination, and the second is ex parte expungement.
Reexamination permits challenges to use-based registrations by any third party for five years after a mark is registered. In other words, a registrant’s allegation of use of a mark for each of the goods in a registration can be challenged, if the challenger is able to submit evidence to the USPTO establishing an authentic case of nonuse as of the date on which the registrant alleged use in support of their application.
Expungement, on the other hand, permits challenges to all registrations, including registrations that did not require an allegation of use by any third party between the third and 10th years after registration. This tool primarily targets registrations based solely on a foreign/international registration rather than an allegation of use. These registrations can be challenged if the challenger is able to submit evidence to the USPTO establishing an authentic case that the mark has never been used.
Whether reexamination or expungement is sought, a challenger must establish nonuse at the time use was alleged (reexamination) or that the mark was never used (expungement), and provide a verified statement that “sets forth the elements of the reasonable investigation the petitioner conducted to determine” nonuse/never used and “any additional facts that support the allegation.” Once a proceeding is instituted, registrants will be provided an opportunity to refute the allegations by submitting evidence of use of their mark and a determination on cancellation will follow. While specific rules for these proceedings are yet to be provided, the required effort will certainly be less costly and time consuming than a cancellation proceeding.
While these tools are beneficial to all brand owners, entrepreneurs, start-ups and small businesses should benefit most from the TMA and its provision of relatively inexpensive tools to quickly clear a path for the use and registration of their perfect mark.