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Improper Descriptions of Use in TM Registrations

Lawrence Stanley July 25, 2014

The United States Patent and Trademark Office (“USPTO”) is currently considering ways to ensure that trademark registrants claim only those goods and services for which they are actually using their marks. All the proposals involve time and expense to the trademark owner. For that reason alone, it’s important to get registration – and subsequent Declarations of Use – right the first time. But there’s more you need to know…

Trademark registration in the United States, unlike most of the rest of the world, is based on use: that is, the USPTO requires that the registrant actually use (or have a bona fide intent to use) its mark in U.S. commerce on all the goods and/or services listed in the application. In order to enforce that requirement, the registrant is required to attest to such actual use through post-registration “Declarations of Use” under Section 8 of the Trademark Act. Declarations of Use must be filed between the 5th and 6th anniversaries of registration, between the 9th and 10th anniversaries of registration, and in each successive ten-year period thereafter. For a fee, the registrant may file within a six-month grace period, but failure to file a Declaration will result in cancellation of the registration.
Normally, a registrant submits a specimen showing use of the mark on one of the goods and/or services listed in each class of goods/services listed on the registration, and attests that “[t]he mark is in use in commerce on or in connection with all of the goods or services listed in the existing registration for this specific class…”

The Declaration also gives the registrant the opportunity to delete goods and services that are not in use or to explain an excusable failure to use the mark in connection with particular goods or services. The registrant is warned that “willful false statements and the like are punishable by fine or imprisonment or both” and “may jeopardize the validity of this document.”

In fact, the penalty can be severe if the registrant’s mark is ever challenged by a third party in a cancellation proceeding before the Trademark Trial and Appeal Board. If the mark is not being used in connection with all the listed goods and services, the entire registration may be cancelled on the basis of non-use and falsely representing that the mark was in use when it wasn’t.

Even given that risk, the USPTO is aware that many registrants are not using their trademarks on all the goods and services listed on their registrations. This is particularly the case with registrants under Section 44(e) (registrations based on a foreign registration) and Section 66(a) (registrations based on Madrid Protocol). In many countries outside the U.S., the registrant, aiming to obtain a greater scope of protection, will register its mark using descriptions of goods and services that are much broader than the USPTO permits, with the only risk being the deletion of some goods or services from the registration after the first 3 or 5 years. We have assisted numerous non-U.S. clients in avoiding this potential pitfall in their United States registrations by querying them closely as to actual use and narrowing the description of goods and services where appropriate.

Recently the USPTO completed a pilot program, which was really a spot check of 500 randomly selected registrations for which Declarations of Use were being filed. The results confirmed our observation in practice that non-U.S. registrants who obtain their registrations based on a foreign registration or the Madrid Protocol often have difficulty understanding the requirements of the USPTO.

Among the 500 registrants was a statistically significant sample of registrations under Trademark Act Sections 1(a) {use-based}, 44(e) {foreign registration based}, 66(a) {International Registration/Madrid Protocol based}, and 1(a) and 44(e) combined (dual basis). Each of the selected registrants was required by the USPTO to submit proof of their marks for two additional goods and/or services per class, in addition to the specimen(s) submitted with their Declarations of Use. If the registrant failed to submit the required proof or requested that goods and/or services be deleted, the USPTO asked for additional proof.

The results were striking. The majority of foreign-based registrations – 56% of Section 44(e) registrants, 61% of Section 66(a) registrants and 63% of dual basis registrants – ended up requesting deletion of goods and/or services that they weren’t using. In contrast, 27% of Section 1(a) registrants requested deletions of goods and services. The latter figure is still unacceptably high, however, and highlights the necessity among trademark registration service providers to take the time to limit their clients’ descriptions of goods and services to those that the client is actually using or has an excusable reason for not using. Had any of these registrants’ marks been challenged by third parties, their U.S. registrations could have been cancelled.