The Importance of Trademark Application Accuracy in Obtaining and Retaining a Registered Mark

A ‘trademark’ is a legal term that represents the source of a product or service and includes any name, brand, packaging, logo and sound that causes the consumer to associate the good/service with the source.  Many businesses seek to formerly register their marks through the United States Patent and Trademark Office to enhance the value and geographic reach of their mark(s) through the fifty states and US territories and thereby obtain a valuable business asset(s).  

The filing of a trademark registration application may seem relatively straightforward.  However, things can fall apart either during trademark application prosecution or even after a registration has been obtained if errors in the application were made.   This is so even where the applied-for mark meets the threshold requirements for registration: 1) there is no likelihood of confusion with existing marks; and 2) the mark is not merely descriptive or generic.  

This blog addresses errors in a trademark application, whether innocent, sloppy, or intentional, that can prevent registration of a proposed mark or cause a registration to be later cancelled.  

Take Home Points:

1. 1. Never file an intent-to-use (1B) application without having a bona-fide intent to use it in commerce – i.e., to use it in a commercial setting.  
   2.  Make sure you understand what bona fide use in commerce means under trademark law.  The use must be verifiable, real, genuine, legitimate and on-going at the time a 1A application is filed or when a 1B application’s Statement of Use is filed.  
   3. Common law rights can trump registered trademarks on the basis of priority of use.  Always provide accurate date information on mark usage in trademark applications.  
   4.  Develop and retain objective documentary evidence showing the dates of first use anywhere and in commerce for every identified good/service in the application.  

 A. Introduction 

Two trademark registration requirements that applicants must pay attention to are: 1) the need to provide accurate information related to the dates of first use anywhere and in interstate commerce; and 2) the need to ensure that all of the listed goods/services are indeed in interstate commerce as of the date specified in the application for a 1A application or a Statement of Use for an intent to use (1B) application. Failure to provide accurate information related to these two requirements during prosecution of a trademark application could result in cancellation of an issued registered mark or an application being declared void ab initio by the Trademark Trial and Appeal Board (TTAB).  Alternatively, the TTAB could require amendment of the application or registration to delete and unused goods/services.   The TTAB’s decision will depend on whether or not it concludes that the applicant had engaged in fraud to obtain its registered mark. 

This blog examines these two requirements in detail.  

B. Comparison of 1A and 1B Trademark Applications

1A applications apply to those marks which are already being used in interstate commerce at least as early as the application’s filing date.  1A applications must include specimens showing usage of the mark for the application’s specified goods/services by the applicant.  That is, specimens must identify the source or provider of the mark’s associated goods/services.   The application must also specify both the dates of first use anywhere and the date of first use in interstate commerce.  Furthermore, by filing a 1A application, the applicant is representing that all of the identified goods/services are being used in interstate commerce as of the application’s filing date.   

What if the 1A applicant is not actually using the mark on all of the application’s identified goods/services?   How can the applicant try to avoid an issue down the road?  The applicant may cure the problem by timely amending the application’s basis to a Section 1B application.  

1B applications, known as intent-to-use applications, serve as a means to “reserve” the mark and have it undergo preliminary evaluation while the applicant is developing the goods and/or services which are to be offered under the mark in interstate commerce.  The 1B applicant must have a bona fide intent to use the applied-for mark for all of the goods and/or services identified in the application.  If the 1B mark receives a Notice of Allowance, the applicant’s next step is to file a Statement of Use (SOU) alleging that the mark is being used in commerce for the application’s identified goods/services application’s specified goods/services.  The SOU must include specimens and specify the dates for first use anywhere/first use in commerce.   

As further discussed below, in both cases, the use in commerce must be bona fide meaning real, genuine, legitimate and on-going commerce.  The USPTO examining attorney is relying on the applicant’s honesty that the in-commerce standard is met.   Additionally, bona fide use applies to all of the application’s listed goods and services.  

With either type of application, upon approval by the USPTO examining attorney, the mark will be published for opposition in the Official Gate.   A third party may file an opposition proceeding with the Trademark Trial & Appeal Board to try and prevent registration of the mark if it would be harmed by the registration.  The three opposition grounds pertinent to this blog are: 

1. The Opposer has priority rights in the mark.  Manual of Trademark Trial Board Proceedings (TBMP) 309.03(c)(2)(A).  
2. There was no bona fide use of the defendant’s mark in commerce prior to the filing date of the 1A application or, for the 1B application, within the expiration of the time for filing an SOU (TBMP 309.03(c)(3).  
3. That defendant did not have a bona fide intent to use the mark in connection with the identified goods/services as of the filing date of the 1B application (TBMP 309.03(c)(3).

Even if a “faulty application” results in a registered mark, the registered mark may later be subject to cancellation.  A cancellation proceeding for a registered mark may be commenced within 5 years of the mark’s registration date on any ground that an opposer could have claimed in opposing registration of the mark including the above three stated opposition grounds.  After the 5-year period, cancellation grounds are more limited.  Two additional procedures are also now available for contesting registered marks: 1) Expungement Proceedings within the 3rd and 10th year of registration for marks which are allegedly never used; and 2) Reexamination Proceedings within 5 years of registration wherein the registered mark was allegedly not used on or before a particularly relevant date. 

C. The Importance of Accurate Dates in a Trademark Application to Avoid a Priority of Rights Contest

Regarding the priority of rights grounds for filing an opposition proceeding, this is where the applicant’s specified first use anywhere and first use in commerce become critical.  In the US, prior users of a mark are afforded important rights under trademark law.   Proving priority can be based solely on intrastate use. “Proof of prior and continuous use in intrastate commerce [by the opposer] is sufficient to preclude registration.”  McCarthy at Section 20:17. 

  If an application is refused as the result of an opposition proceeding, each party may have common law rights in different states/territories, but the applicant’s mark will not be federally registered.  In an opposition proceeding involving priority rights, the TTAB will rely on the dates specified in the application and also determine if the use as of the specified dates was bona fide.   The opposers in this type of proceeding are generally common law trademark rights holders.  That’s why it’s recommended that common law rights are considered when clearing marks for registration via a trademark search.  Priority of use claims are not available for merely descriptive common law marks unless the common law mark has acquired distinctiveness, a very challenging criterion to meet.  

Where there are two pending applications for similar marks applying to the same types of goods and services before the USPTO, the first-filed application is first in line for examination.  If it registers, the later-filed application may be rejected.   The USPTO examining attorney may also suspend examination of the second application until prosecution of the first application is completed. 

 The owner of the later-filed application should monitor the prosecution history of the first-filed application.   If the first-filed application is published for opposition, the owner of the second-filed application has the option to file an opposition proceeding on priority of use grounds. The owner of the second-filed application may also consider filing a Letter of Protest on priority grounds which will be provided to the first application’s examining attorney.  Such letters, however, are not intended to replace opposition proceedings.  

Based on the importance of priority use in trademark law, a trademark applicant should develop and retain objective evidence to establish when bona fide use of the mark commenced for each and every identified goods/services. The specified dates of first use anywhere and interstate commerce in the application (which may be the same) should match up with the objective evidence. 

And remember that a registered mark can be contested in a Cancellation Proceeding or a Reexamination Proceeding on the basis of “faulty” dates provided in the original application. 

D. The Importance of Bona Fide Use to Avoiding an Opposition/Cancellation Proceeding Alleging Lack of Bona Fide Use

For both 1A and 1B application, the use in commerce must be bona fide meaning real, genuine, legitimate and on-going commerce.  The standard applies to each and every good/service identified in the application.  “In commerce” means that the mark is being used with the goods or to promote the services and the goods have actually been sold and transported across state lines.  For service marks, the services must have actually been rendered in the US.  Commerce involving US territories also counts.  

An opposition/cancellation proceeding commenced on an allegation of lack of bona fide use may also include a claim for fraud.  If fraud is proven, the application will be declared void ab initio for any class of goods/services for which fraud is proven.  Similarly, a finding of fraud with respect to a particular class of goods/service specified in a registration will be cancelled.  This is so even if the fraud is found to pertain to only one specified good or service in an identified class where the description for the class specified more than one good or service.  

If fraud is not proven or in the absence of a fraud claim, a 1A applicant who bases its application on use in commerce as of the filing date but who was not using the mark on some or all of the goods or services identified in the application as of the application’s filing date may “cure” this problem by amending its original 1A filing basis to a 1B filing basis.  Grand Canyon West Ranch, LLC  v. Hualapai Tribe, 78 USPQ 2d 1696 (TTAB 2006)(precedential).   A registration may be amended to remove any “offending” specified goods/services. 

E. Bona Fide Intent in 1B Applications

The bar for establishing bona fide intent is not high but does require something more than “mere subjective belief.”  Trademark Act Section 1(b)(1), 15 U.S.C. § 1051(b)(1).  M.Z. Berger, 114 USPQ2d at 1897–98, Swiss Grill, 115 USPQ2d at 2008.  Ideally, the applicant has objective proof of such intent at the time the application is filed. A business plan, NDA, website developer contract, registered domain name, patent application or patent grant, copyright registration/application prototype, etc. existing as of the application’s filing date will provide actual evidence of the applicant’s bona fide intent should a third party ever challenge a registration.  The absence of any documentary evidence regarding an applicant’s bona fide intention to use a mark in commerce establishes a prima facie case that an applicant lacks such intention as required by Section 1(b) The applicant may counter with facts that adequately explain or outweigh its failure to provide document.  

Generally, the examining attorney will not question an applicant’s bona fide intent declaration.  That is, the applicant’s declaration within the 1B application is sufficient to support the filing of an intent-to-use application.  

However, the issue may be raised in an opposition proceeding brought by a third party claiming that it would be harmed by the registration.  Whether an applicant has a bona fide intention to use the mark in commerce is an objective determination based on the totality of the circumstances. See M.Z. Berger & Co. v. Swatch AG, 787 F.3d 1368, 114 USPQ2d 1892, 1898 (Fed. Cir. 2015); Swiss Grill Ltd. v. Wolf Steel Ltd., 115 USPQ2d 2001, 2008 (TTAB 2015). The evidentiary bar for showing bona fide intent to use is not high, but more is required than “a mere subjective belief.” The objective evidence must indicate an intention to use the mark at the time the 1B application was filed that is “firm” and “demonstrable.” 

What about allegations of an applicant’s fraud by an opposer in an opposition proceeding to prevent registration of a mark?  Since the TTAB’s decision in In re Bose, fraud related to lack of intent to use is quite difficult to prove.  However, a finding of fraud with respect to a particular class of goods/services specified in an application is still a serious matter post-Bose because it renders any resulting registration void as to that entire class.  This is so even if the fraud is found to pertain to only one specified good or service in a particular class where the description for the class comprised numerous associated goods or services.  See Saul Zaentz Company dba Tolkien Enterprises v. Joseph M. Bumb, Opposition No. 91170589.

On the other hand, where a successful claim of lack of bona fide intent without a fraud claim by an opposer pertains to only certain goods/services as to where there was no such intent, the entire class will not be knocked out.  Instead, the TTAB will require the goods/services for which there was no bona fide intent to be deleted from the application. 

For a 1B application where several goods/services are identified, it is conceivable that all such goods/services will not enter interstate commerce all at the same time.  The applicant of such an application may file a request to divide the application under such circumstances.  That is, the applicant may file a Statement of Use showing use of at least some of the goods and services to obtain a registered mark for those goods/services and proceed with prosecution of the remainder of the application with respect to the other identified goods/services through a request to divide the original application into two applications (the parent and child applications).  The request to divide can involve a dividing of goods/services within a classification such that certain of the goods/services from the classification are now transferred to the new application.  Where the application has at least two classes of goods/services specified, another option is to “transfer” an entire class of the specified goods/services to a new application.  Eventually, a Statement of Use will also need to be filed for these “transferred” goods/services. 

THANK YOU FOR YOUR INTEREST IN THIS ARTICLE.  THE CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT LEGAL ADVICE.