Use of trademarks is an area where U.S. trademark law differs from many other jurisdictions. The general rule is that a mark must be in use as a trademark in order to acquire and maintain trademark rights, although there are some exceptions to this rule. This article summarises key areas where use of a trademark is critical to trademark protection.
Use required for registration.
Before a trademark is granted registration in a trademark, U.S. trademark applicants must demonstrate “bona fide use of the mark in the ordinary course of trade”. Token use, or use merely for purposes of reserving a right, is insufficient.
According to the federal law defining the required use, use of a mark on goods must be demonstrated by showing some affixation of the mark to the goods or their packaging and that the goods are sold in interstate commerce. Use of a mark for services are demonstrated through advertising materials combined with the ability to order and purchase the services. In practice, a trademark applicant need only submit 1 specimen of use for some goods/services in each Nice Classification in the application, although the USPTO Examining Attorney may request more specimens during the prosecution. The “use in commerce” requirement has had updates of sorts, through case law, relating to the use of marks on the internet.
There are exceptions to this rule. First, the Section 1(b) Intent-To-Use application (“ITU”) allows an applicant at the time of application to file a declaration of a “bona fide intent to use” the mark instead of proof of actual use. Foreign applicants making Section 44(d), 44(e), or 66(a) applications need not file proof of use or an ITU declaration in order to gain registration. However, they can be required to prove use in commerce within a “reasonable” time after registration, especially in the case of a petition for cancellation.
Use of a mark in opposition/infringement proceedings
The date of first use of a mark in commerce is paramount in inter partes trademark proceedings in the U.S. As the “first in time, first in right” rule applies even where the junior user has a U.S. trademark registration, it serves trademark applicants well to conduct comprehensive clearance searches prior to deciding on a mark for a trademark application. While the senior user of an unregistered right will face heavy legal costs in establishing its rights against the junior user (compared to the same situation if it had an earlier registration), the junior user/registrant would never be able to wrestle the right to use the mark from the senior user.
Non-use as a grounds for cancellation
The failure to use a mark in commerce can lead to abandonment of the mark, making a trademark registration vulnerable to cancellation. A trademark right can be abandoned in a few ways, but 3 continuous years of non-use or evidence of intent to abandon use are the usual paths to abandonment of a trademark right.
A petition to cancel that alleges and demonstrates the lack of bona fide use of a registered mark for 3 continuous years establishes a prima facie case of abandonment. The burden of proof then shifts to the registration holder to prove that it has in fact used its mark in a sufficient way. Again, evidence of use which only has the purpose of reserving the rights in a mark is insufficient to save a mark from a prima facie case of abandonment.
A cancellation petitioner may also present evidence of intent to abandon use. An example of this is found in rebranding campaigns, and public communications by a registration holder that a brand will cease to exist and that all future goods/services will be marketed under a new mark would be strong evidence for abandonment. For example, changes in a website landing page or a press release explaining the rebranding and the schedule for changing the name of the brand.
If a registration holder grants “naked” licenses it may bare itself to cancellation. A license is “naked” when there are no or few quality controls imposed and enforced upon the licensee and the licensee is free to use the mark with no actual control from the licensor.