New Trademark Modernization Act Strengthens Protections for Trademark Owners
Congress recently passed the Trademark Modernization Act (TMA), which makes it easier for trademark owners to protect their trademark rights.
The most important protection in the TMA makes it easier for trademark owners to stop infringers from violating trademark rights. The TMA makes injunctions and temporary restraining orders simpler to get by stating clearly that a trademark owner does not have to prove irreparable harm to make a case. In most lawsuits outside the trademark arena, a court will not grant an injunction unless the plaintiff proves that it will be damaged in a way that cannot be remedied with monetary damages. The TMA removes the requirement of irreparable harm and places the burden on the defendant to show that the injunction is not needed.
Easier to stop competing trademark registrations
Another welcome change for trademark owners is that the TMA allows them to show they were using the trademark before the new user earlier in the registration process. They can submit evidence of prior use before a trademark application has been preliminarily approved by the trademark examiner or published for opposition. This change gives trademark owners a chance to affect whether a trademark is approved in the first instance, in a less expensive setting than a formal opposition proceeding, as the case is now.
Combats fraud and deadwood
In a major win for prospective trademark applicants, the TMA makes it easier to cancel another company’s trademark registration for fraud or deadwood (trademarks that are no longer being used by their owners). While intentional fraud has always been a ground for cancellation, it is hard to prove. The new law does not require proof of fraud in cases where the owner of the registration is not using the trademark in the U.S. as required.
Congress found that the U.S. Patent and Trademark Office (USPTO) has been getting more trademark registration applications and renewal requests with false claims that the trademark is being used in commerce or even fake or digitally altered samples of supposed use. The TMA makes it easier for U.S. businesses to combat this kind of abuse.
New procedures to reexamine invalid trademark registrations
Under the TMA, a trademark owner can file a petition for expungement or reexamination of a trademark registration on the ground that it is not being used in commerce in the U.S., as registration requires. This kind of petition must be filed within 3 or 5 years after the registration, depending on the procedure used.
The TMA also allows trademark owners to request cancellation of a trademark that has never been used in the U.S. These new procedures are designed mainly to stop foreign companies from exploiting vulnerabilities in the registration process to register trademarks that should not have been registered.
Faster trademark registration decisions
In another change from the current trademark registration system, the TMA allows trademark examiners to set shorter deadlines for applicants to respond to trademark application rejections. The current rules give applicants six months to respond to notices from the Trademark Office. Under the TMA, examiners can set deadlines of 60 days instead.
Applicants can request more time if needed, but they will have to pay an extra fee to get the full six months to respond to a rejection. While this change may work a hardship on some trademark owners, the overall effect will be to speed up the trademark registration process.
Most changes take place in one year
Except for the change in the burden of proof of injury in injunction proceedings, which takes place immediately, most of the TMA’s administrative revisions take effect on Dec. 27. This gives the USPTO a full year to draft regulations to implement the TMA’s changes in the law.
Please contact David L. Patrón, Mary Ellen Roy or any other member of Phelps’ Intellectual Property team if you have questions.
