By: Stephen Agnatovech
Despite the perception that life has stood still since March of 2020 due to the pandemic, time keeps passing by and trademark owners are facing new challenges. As we move into the second year of the COVID-19 pandemic, trademark maintenance deadlines in 2021 create new barriers for restraints for trademark owners who want to hold on to their mark. U.S. trademark law requires trademark holders to continuously use their trademarks in commerce or risk being challenged or canceled for abandonment. This is particularly difficult for trademark owners who had to shut down their place of business due to the pandemic. The USPTO has not given any leniency to trademark owners during the shutdown which means that trademark holders must adapt to the circumstances and find a way to use their mark in commerce or be subjected to the rules of abandonment.
According to the U.S. Customs & Border Protection (“CBP”), criminals are taking advantage of the concerns involved with the pandemic, with an increase in counterfeit products at U.S. ports. There is also an uptick in COVID-formative trademark applications, phishing scams, fake charitable websites, and price gouging of legitimate products. This type of criminal activity can cause confusion for consumers and damage the leading brand’s reputation and consumer loyalty. Due to these new challenges, trademark owners are faced with, it is becoming more difficult for legitimate trademark owners to protect their marks through the litigation processes.
While courts are continuing to receive filings electronically, they are truncating other operations, including in-person hearings and jury trials. In response to these concerns, the Trademark Modernization Act of 2020 revised various provisions of the Lanham Act, 15 U.S.C. §§ 1501. Specifically, the Act enhances trademark examination proceedings by formalizing the process third parties may use to submit evidence to the USPTO, and by providing the Office with greater authority and flexibility to set deadlines for trademark applicants to respond to actions taken by examiners. While this may provide leeway for trademark owners in the litigation process, the USPTO has not acknowledged the COVID-19 pandemic as an acceptable excuse for nonuse for a trademark or service.
Under the Trademark Act 15 U.S.C. § 1127, a person must have the bona fide use of a trademark in the ordinary course of trade and shall be deemed to be in use in commerce. If the mark has not been in use for three consecutive years and the holder has done nothing to resume the use of the mark, then it is presumed that the holder has abandoned the mark. The Trademark Manual of Examining Procedure identifies a lack of use in commerce due to a trade embargo, for example, as excusable nonuse. Another example is a product that cannot be produced quickly or in large numbers, such as airplanes.
Other excusable nonuse includes the Sale of a business, retooling that is essential to the production of the goods, illness, fire, and other catastrophes. However, merely having decreased demand or a business decision within the owner’s control are exemplary instances where nonuse is not excusable. A recent example of this was in the registration for Doc Martens, where the applicant claimed use as to the footwear and excusable nonuse as to the remaining non-footwear apparel due to the pandemic interrupting sales, forcing its retail outlets to close due to various local, state, and federal restriction orders. The USPTO was not convinced and resorted to the fact that goods were still available for purchase online. This has been the ongoing theme by the USPTO, so where does this leave trademark holders?
They may not have recourse through the USPTO, but trademark holders should act early, proactively, quickly, and with a balanced approach, never tossing conventional wisdom aside. Never be draconian, and never price gouge with the potential of damaging your brand and long-term goodwill for a temporary gain. When it comes to the process that the registrant is involved in, if possible, they should delay and wait long enough for their goods and services to go back on sale before the filing deadline arrives.
Alternatively, if a registrant’s goods are in use now but may be shut down again in the near future, the registrant ought to file promptly. Only allege use for the goods that you can verify are in use when you file and confirm that it is in use in interstate commerce, not just local or intrastate use. Trademark users should also consider if their goods and services not in use are due to the pandemic, and if so, find a viable excuse through the Trademark Manual of Examining Procedures. These tactics could save trademark user’s marks or services during a time where everyone is trying to find a new sense of normalcy due to the uncertainty caused by the pandemic.
Student Bio: Stephen Agnatovech is a second-year law student at Suffolk University Law School. He currently serves as a staff member on the Journal of High Technology Law. Stephen received his Bachelor of Arts in Political Science from Stonehill College and wants to pursue a career in either intellectual property or sports & entertainment law.
Disclaimer: The views expressed in this blog are the views of the author alone and do not represent the views of JHTL or Suffolk University Law School.
