US Trademark Modernization Act Takes Effect

• Published date: 25 January 2022
• Subject Matter: Intellectual Property, Copyright, Trademark
• Law Firm: Mayer Brown
• Author: Ms Kristine Young, Michael D. Adams, Richard M. Assmus, Guy W. Barcelona Jr. and Todd A. Davidovits

The Trademark Modernization Act of 2020 (TMA)¹ took effect on December 18, 2021, creating additional avenues for enforcement and updating rules pertaining to trademark prosecution and maintenance. The most significant changes include new ex parte expungement and re-examination proceedings before the United States Patent and Trademark Office (USPTO), new rules pertaining to Letters of Protest and deadlines for office action responses, and the resolution of a circuit split by establishing a rebuttable presumption of irreparable harm in cases where infringement is found, making it easier for brand owners to secure injunctive relief. The TMA also includes the Copyright Alternative in Small-Claims Enforcement Act of 2019 (CASE Act),² which implements a new Copyright Claims Board (CCB) charged with hearing disputes valued under $30,000, providing an alternative and lower cost avenue for copyright owners seeking to enforce their rights. These changes give rise to new strategy considerations for brand owners seeking to protect, maintain and enforce their trademarks and copyrights, which are discussed in this Legal Update.

Ex Parte Expungement and Re-Examination Proceedings, and New Grounds for Cancellation, to Remove "Deadwood" Trademarks

"Deadwood" registrations are trademarks that are registered but not in use. Once a mark registers, the registrant only needs to submit proof of use at six years, 10 years and every 10 years thereafter. As a result, marks can remain on the Trademark Register for years even though they are not in use. These "deadwood" marks can block parties from registering similar marks for similar goods or services and can present hurdles to launching new brands.

To address this issue and help clear the Trademark Register of zombie marks, the TMA enacted ex parte re-examination and expungement proceedings, which can be filed with the USPTO either by third-party petitioners or by the Director of the USPTO (Director) on their own initiative.³ Re-examination proceedings can be used to remove or limit trademark registrations where a registrant inaccurately claimed it was using the trademark in commerce as of a certain relevant date (i.e., the application filing date for marks applied for on a 1(a) "use" basis or the Statement of Use date for marks applied for on a 1(b) "intent-to-use" basis). Such proceedings must be filed within five years after a mark's registration.

An expungement proceeding can be used to remove trademarks from the Trademark Register that have never been used in US commerce in connection with some or all of the registered goods and services. These proceedings can currently be filed after a trademark has been registered for three years. After December 27, 2023, expungement proceedings will be available for trademarks that have been registered between three and 10 years. Although expungement proceedings were aimed at addressing trademarks filed by foreign entities using the Madrid Protocol or Paris Convention, under which a use showing was not required to secure registration, these proceedings can be instituted against any registration that meets the relevant criteria.

Once a re-examination or expungement proceeding has been instituted and is pending, no similar proceeding may be instituted for that registration with respect to the same goods or services. If a subsequent proceeding identifies additional goods or services, it may proceed only with respect to the additional goods or services.

Both proceedings provide an alternative to a contested inter partes cancellation proceeding before the Trademark Trial and Appeal Board (TTAB), which can be costly to pursue. To initiate re-examination or expungement proceedings, a petitioner must:

• Pay a filing fee ($400 per class of goods or services challenged);
• Submit a verified...