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Client Alert - Be Ready to Prove Intent to Use or Actual Use of a Trademark

02.10.2017

Two recent developments convey similar messages regarding the need to maintain supporting evidence at both the trademark application and registration stages.  

If you file an application alleging an intention to use the mark in commerce, you may be required to support that allegation if it is challenged in an opposition, cancellation or infringement proceeding. 

Further, the United States Patent and Trademark Office (“USPTO”) may now require you to prove the actual use of your mark in connection with all of the goods and services listed in your trademark application or registration.

Be prepared to demonstrate your bona fide intent to use

The U.S. Trademark Law (known as the Lanham Act) has long required applicants seeking registration of a trademark before actual use of the mark in commerce to have a “bona fide intention” to use that mark in commerce.  This requirement also applies to a U.S. application based on a non-U.S. country-of-origin registration, which can be issued without proof of use in commerce. 

The Lanham Act does not define what a “bona fide intention” is or what is required to prove it.  Nevertheless, when this issue was raised in oppositions or cancellations, trademark applicants have been required to demonstrate in some objective way, preferably through documentary evidence, that they intended to use the mark in commerce.

This requirement is not a mere formality.  As an applicant filing an intent to use trademark application, you must be able to demonstrate a firm intention to use the mark in commerce or you will risk having the application refused or, if the mark is already registered, having the registration cancelled in whole or in part.  Merely asserting a “generalized intention or desire to license the mark or partner with others at some indefinite time in the future” is not enough to establish the requisite bona fide intent. 

Here are two examples: (1) Lincoln Nat’l Corp. v. Anderson, 110 U.S.P.Q.2d 1271 (T.T.A.B. 2014) (precedential) (“We find that applicant’s idealistic hopes for forming a futuristic company based on his FUTURE mark, as reflected by the above-quoted excerpts from his testimony and website, do not suffice as the requisite Section 1(b) specific bona fide intention to use the mark in commerce in connection with the Class 35 and Class 36 services identified in the application. Rather, we find that applicant, in filing the application, was merely attempting to reserve a general right in the mark for potential use on some undetermined goods or services at some indefinite time in the future.”); (2) L’Oreal S.A. v. Marcon, 102 U.S.P.Q.2d 1434, 1443 (T.T.A.B. 2012) (precedential) (“Applicant’s very generalized and non-specific reference to licensing and outsourcing as potential strategies to bring the product to market at an unspecified time in the future [is] woefully deficient in showing a bona fide intent to use the mark.”). 

Further, Swatch AG v. M.Z. Berger & Co., 787 F.3d 1368, 1375 (Fed. Cir. 2015) established that, if an opposer challenges your trademark, the opposer may satisfy its initial burden at trial by simply showing the absence of documentary evidence regarding your bona fide intent.  Once an opposer has established that contemporaneous documentary evidence of the claimed bona fide intent is absent from the record, the “burden of production shifts to applicant to come forward with evidence adequately explaining or outweighing the failure to provide such documentary evidence.”  Id.  The burden, therefore, is always on the trademark applicant to prove that there was a bona fide intention to use.

However, in Kelly Servs., Inc. v. Creative Harbor, LLC, 121 U.S.P.Q.2d 1357, 1370 (6th Cir. 2017), an infringement action with cross motions for a declaratory judgment, the appellate court held that, where an applicant lacked a bona fide intention as to some, but not all, of the listed goods or services, the overbroad portions should be excised but the application should not be voided in its entirety absent fraud or other egregious conduct.

Even though an Examining Attorney will not question the verified statement of an intention to use that you file with your trademark application, that statement is not enough to establish the required bona fide intent.  You should maintain documentation that substantiates your firm bona fide intention to use the mark, and this documentation should either predate or coincide with the filing date of the application.  Otherwise, when you seek to enforce rights against a later applicant or an infringer, failure to have proof on this point could negate the reason for, and the effort and expense of, getting the registration just at the time you most need it. 

The potential consequences go beyond refusal or cancellation – you may even lose priority for the trademark, especially if another party has commenced actual use of the mark between the date you filed your application and the date that you first used your mark in commerce. 

This documentary evidence requirement is particularly likely to be applied to a non-U.S. applicant who has extended a Madrid Protocol international registration to the U.S. with a very long description of various goods or services. 

Be prepared to verify use in commerce

Effective March 21, 2017, the USPTO is amending its rules regarding the examination of (a) a statement of use filed after a Notice of Allowance is issued for an intent to use application; and (b) an affidavit or declaration of continued use or excusable nonuse filed under Section 8 or 71 of the Lanham Act to maintain a registration.

Under these new regulations, even when the statement, affidavit or declaration is accompanied by the required specimen showing the use of the mark on one listed good or service in each class, the USPTO may require submission of additional proof (such as additional specimens, information, exhibits, affidavits or declarations) to demonstrate use of the mark in commerce on some or all of the other listed goods or services. 

The USPTO has stated that it will conduct random audits of up to 10 percent of the Section 8 and Section 71 affidavits or declarations filed each year for registrations with more than one good or service per class.  If audited, trademark owners will have up to six months to respond to the Office Action.  In response, the trademark owner may submit the required proof of use or delete the goods or services for which the mark is not being used.  If the trademark owner fails to respond, the USPTO will cancel the entire registration unless time remains in the grace period for the Section 8 or 71 filing.

According to the USPTO, these rules are meant to diminish the costs associated with determining whether a mark is available for use or registration and to help the USPTO clear the register of unused marks, commonly called “dead wood.”

Conclusion

You must be prepared to show contemporaneous, specific and concrete evidence of your bona fide intention to use the mark in commerce for any U.S. application that is not based on use in commerce.

Likewise, if your U.S. application or registration claims use on or in connection with multiple goods or services, you need to be prepared to prove that the mark has been used in commerce for all of the listed goods and services. 

For these reasons, it would be helpful to maintain a file of evidence to support your intention to use the mark, and specimens showing the actual use of the mark on all of the goods and services listed in your U.S. applications and registrations. 

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