United States Trademark Registration and Protection:
Five Potentially Fatal Mistakes Made by U.S. and Foreign Brand Owners
Seeking United States trademark registration protection is full of traps for the unwary, not only for pro se applicants but also for attorneys that step outside of their every-day specialties. This post focuses on five trademark traps (and there are many others) that U.S. and foreign brand owners make when seeking U.S. trademark registration and protection.
1. United States is not a “first-to-file” country. Because many foreign trademark applicants are domiciled in countries that grant exclusive trademark rights to those that file and register first, they fail to understand that trademark rights in the United States are created based upon trademark use rather than federal trademark registration. Thus, even if there are no pending trademark applications or registrations on the United States Patent and Trademark Office (“USPTO”) database for the same or similar mark that does not mean that a trademark is available for use and registration.
- In 2008, Company A begins using the mark APEX in San Francisco for insurance services and begins expanding into neighboring states.
- Company A does not seek federal trademark registration.
- In 2011, Company B begins using the mark APEX in NYC for insurance services and secures a U.S. trademark registration for its mark and services.
- Although Company B is the first to file a trademark application with the USPTO for the mark APEX, Company A may still object to the filed application for APEX via an opposition proceeding or seek cancellation of a resulting registration, within a certain period of time, on the basis of priority of use rights.
It is well established that the first company to use a mark in the U.S. (on a systematic and continuous basis) has priority not only with respect to use of the subject mark for the associated, and related, goods/services (in the geographic regions within which the mark is used) but also with respect to federal trademark registration.
For that reason, it is imperative that companies undertake a comprehensive trademark search not only for marks on the USPTO database but also for common law trademarks (those in use but not federally registered) as well as business names to ensure that the proposed mark is available.
Failure to undertake such review is risky and may result in thousands, if not hundreds of thousands, of dollars in litigation costs and re-branding efforts.
Read more about how trademark rights are created here.
2. Lack of bona fides (navigating this slippery slope). Under U.S. trademark law, brand owners may file U.S. trademark applications either before or after their marks launch. If they file before brand launch, they must have a bona fide intent to use the applied-for mark for the listed goods/services in U.S. commerce as of the trademark application filing date.
U.S.-based (and foreign) applicants may file, what is known as, an intent-to-use (a/k/a 1(b)) trademark application prior to brand launch; however, they must ultimately use the mark in U.S. commerce before a registration will issue.
Unlike U.S.-based applicants, however, foreign applicants may secure U.S. trademark registration without using the mark in the U.S. prior to registration issuance under Section 44(e) (based upon a foreign registration) and Section 66(a) (based upon a foreign registration and filed via the Madrid Protocol). Those filing basis still require foreign applicants to have a bona fide intent to use the applied-for mark in U.S. commerce for the listed goods/services.
Lack of a bona fide intent to use a mark for the goods/services listed in an application (i.e., lack of a written plan to use the mark for the goods/services or actions taken to bring the mark/brand to market) renders an application and resulting registration vulnerable to attack by third parties on the basis the applicant lacked the pre-requisite “bona fide intent to use” the mark in the U.S.
This is problematic for many foreign applicants because many rely upon their home country trademark registration(s) for securing U.S. trademark registration, which may list goods and/or services of which they never intend to sell under the applied-for mark, which is permissible under their own country trademark law.
For those reasons, U.S. and foreign applicants should list only those goods/services in their U.S. trademark applications that they intend to sell in U.S. commerce or run the risk of third party challenges and losing valuable trademark rights.
To read more about lack of bona fides, read my blog post here.
3. Trademark use is required to maintain registrations. As mentioned above, foreign applicants may secure U.S. trademark registration without having used an applied-for mark in U.S. commerce prior to registration. At a certain point, however, the foreign registrant must show use of a registered mark in the U.S. in order to maintain its registration.
During the fifth and sixth year of registration, and at the tenth-year anniversary and every ten years thereafter, a trademark registrant must provide evidence of use of the mark, as registered, in the United States for the goods/services listed in the registration. Failure to show valid use of the registered mark in the U.S. during those periods will result in the cancellation of a registration by the USPTO. Note that even slight changes to the manner in which the mark is used may render the registration invalid (i.e., using the registered mark APEX as “APEX PLUS”).
Failure to use a registered mark in a manner acceptable to the USPTO may result in application abandonment or registration cancellation. Furthermore, a mark not used during a consecutive three-year period post registration is vulnerable to cancellation on the basis of non-use.
For more information about acceptable specimens of use, read my blog post here.
4. “I searched the USPTO trademark database and my name is available because a “competitor” abandoned its trademark registration for the same mark”
Unfortunately, it’s not that simple. Trademark rights in the U.S. are not
created based on trademark registration; they are based on actual use. Therefore, if the owner of the now cancelled trademark registration is still using the once-registered mark, that continued use would trump the “new-comer’s” use and even a “new-comer’s” issued trademark registration.
Don’t get caught in this trademark trap…trust me.
5. “I secured my “Business Name LLC” with the state, so I own the name and trademark”
Although you have successfully registered “Business Name LLC” with state “x” … that does not give you any legal right to use that name and corresponding trademark in consumer-facing marketing and business activities if that name infringes existing third-party business name and/or trademark rights.
States typically review names to ensure that they are “distinguishable on the record” from other registered business names for the purpose of identifying a specific entity from another, not whether the names are “confusingly similar” (a/k/a infringing).
The only way to know if a selected name is available for use and registration is to conduct initial trademark and business name clearance.
You can read more about trademark clearance here.
Intellectual property law (patents, copyrights, trademarks, trade secrets) is filled with traps for the unwary; and in many cases IP attorneys specialize in one of those areas only. Just as you would hire a heart surgeon for your heart surgery, hire a “trademark attorney” for your trademarks and not “an attorney that does trademarks” because, as I have said before, there is a difference and it could mean the difference between life and death for your brand launch…
IS THERE A “TRADEMARK ATTORNEY” IN THE HOUSE!?
Roger Bora is a former U.S. Trademark Examining Attorney, a partner in a major law firm, the creator of this blog and, most importantly, a husband and a father of an amazing 13-year-old son.