September 29, 2014
When a trademark owner says the mark is in use on everything in the trademark registration, it is only true half of the time. The U.S. Patent and Trademark Office (USPTO) recently completed an interesting study of trademark registrations. The question addressed in the study was whether in filing documents for the maintenance of registrations, declarants were being entirely candid when they claimed the mark was in use on everything specified in the registration.
A declaration under Section 8 and similar maintenance documents require the signatory to declare that the mark is in use on all the goods (or in connection with all the services), or any not in current use should either be removed from the registration or an explanation of such excusable non-use is required. In the past, the USPTO and courts have taken a strict adherence to the solemnity of such declarations.
Under Medinol Ltd. v. Neuro Vasx Inc., it is fraudulent to execute such a declaration when the declarant knew or should have known that there is not use on all the goods or services specified in the registration. While the legal standard for fraud set forth in that holding was subsequently modified by In re Bose Corp., the ultimate penalty of cancellation still prevails. Under Medinol, the result is cancellation of the entire registration or at least the entire class in question under the subsequent holding in G&W Laboratories, Inc. v. GW Pharma, Ltd.
As a result of discussions between the USPTO and the private bar, there was a question regarding the veracity of the declarations being filed to maintain registrations. In fact, some suggested that in spite of the penalties that decisions such as Medinol sought to impose, declarations were still being filed without complete candor. As a result, the USPTO conducted this pilot study.
In the study they selected a random sample of 500 cases that were spread out among registrations issued under actual use, foreign registration, Madrid Protocol registrations, and combinations of those bases. For each of those registrations, the registrant was required to submit evidence of current use for two additional goods or services per class. The study found that this request resulted in 250 of the 500 registrations ultimately being cancelled for not submitting the required additional evidence of use.
As a result of those findings, the USPTO recognized that there is a need to continue the discussion with respect to best practices for solutions to ensure the integrity of the register. The previous discussions included four potential solutions. One would be to create a more streamlined cancellation procedure, such as the expungement procedure used in Canada. Such a process could allow any third party to raise the non-use objection and then put the burden on the registrant to support such use. Another suggestion is to require specimens for each good or service. The third identified solution is to increase the solemnity of the declaration, such as by giving stronger warning or requiring additional statements to verify such use. The last suggestion is for the USPTO to conduct random audits of the declarations.
While these suggestions have some merit, this is clearly an issue that deserves to be discussed further with the private bar. The USPTO plans to announce future roundtables to discuss the issue. In the meantime, any comments or suggestions may be sent to TMPolicy@uspto.gov.
IP practitioners must be vigilant to counsel trademark registrants to ensure they avoid the potentially severe penalties for false declarations. Registrants must understand the meaning of the declaration and the ramifications of less-than-complete candor.
If you have any questions on the information provided in this alert, please contact Fitch Even partner Joseph T. Nabor.
Adapted from an article written by Joseph T. Nabor and published in Intellectual Property, the newsletter of the Illinois State Bar Association Section on Intellectual Property Law, Vol. 54, No. 1, September 2014.
Fitch Even IP Alert®