Among the provisions of the recent COVID-19 Economic Relief Bill, signed into law December 27, 2020, was the inclusion of the Trademark Modernization Act of 2020 (“TMA”) which includes important changes to trademark law. The TMA helps clarify the standard for brand owners seeking injunctions and introduces a more efficient mechanism for removing trademark “dead wood”–i.e., registered marks that are no longer in use. Further, one of the more significant changes, is the reinstatement of the rebuttable presumption of irreparable harm upon a trademark owner’s showing of infringement.
Prior to the changes in the TMA, federal courts were split regarding their rulings to injunctions in trademark infringement actions. Some courts presumed irreparable harm, while others applied a more demanding standard. Moving forward, all federal courts will be guided by the new TMA provisions that entitle a trademark owner to a presumption of harm upon demonstrating that a party is infringing its trademark. A finding of irreparable harm is a requirement for a trademark owner to be granted injunctive relief, so the TMA may make it easier for brand owners to obtain injunctions.
The TMA also aims at reducing “dead wood” on the U.S. trademark registry by providing procedures to seek cancellation of a registration based on its lack of use in commerce. Two mechanisms were established, neither of which requires the party to have standing, and both can be initiated by any party or the U.S. Trademark Office. The first, ex parte reexamination, allows a party to question use-based registrations—i.e., registrations based on a trademark owner’s statement under oath that the mark is in use in commerce. For the reexamination mechanism, the USPTO will reexamine the accuracy of the statement at the time of its filing date. The reexamination proceeding must be brought within 5 years after a mark’s registration. The second mechanism, ex parte expungement, concerns U.S. registrations based on foreign registrations. For this mechanism, a proceeding must be brought between 3 and 10 years after the challenged mark’s registration. For either proceeding, should the USPTO determine that the challenging party has sufficiently demonstrated non-use, the registrant then faces the burden of presenting evidence showing legitimate use of the trademark in U.S. commerce. The USPTO then either cancels the mark (subject to appeal) or may find the mark valid and bar future ex parte challenges of that registration.
For more information on the Trademark Modernization Act and other intellectual property matters, please contact the attorneys at Rock Fusco & Connelly, LLC.