A trademark cancellation proceeding is a mini-trial that is similar to a civil suit (but it is under the jurisdiction of the Trademark Trial and Appeal Board (TTAB). where a complainant has the chance to challenge and eventually cancel the trademark rights of a defendant. The process resolves whether an individual is illegally maintaining trademark rights to the disadvantage of the plaintiff.
When filing for trademark cancellation, you should consider the costs of filing, the right to oppose or object to your competitor’s use of your trademark, and steps to ensure you get the best results. You must file your response by the deadline or risk losing your trademark. Listed below are some important steps to follow.
Here are some things you should know about trademark cancellation proceedings.
Table of Content
Trademark Cancellation Proceeding Venue
Standing to file an Opposition or Cancellation
Steps to take if You Want to Cancel A Mark
Step to take if you received a Cancellation Notice
TTAB Expedited Cancellation Pilot Program
Costs
In the United States, costs of trademark opposition and cancellation are set by the United States Patent and Trademark Office (USPTO). These fees are increased periodically. The real cost is the attorney fee.
The defendant in a trademark cancellation proceeding must consider the costs involved in mounting a defense and determine if it is indeed worth the time/money/energy/resources. Initial costs for responding to a petition canceling a trademark will be between $3,000 and $5,000, depending on the nature of the claim and how complex it is.
After the response has been filed, there will be a mandatory pre-trial settlement conference that will cost between $1000 and $2200. As the case progresses through the actual litigation process (discovery and trial), the costs will only go up. It is clear that trademark cancellations can be costly for both plaintiffs as well as defendants. This should not be taken lightly.
It is not worth responding to a trademark cancellation complaint if there is no interest of the defendant in keeping the mark. Some trademark owners may not defend against cancellation. This may result from various factors, including a lack of resources to fight against the cancellation.
For example, perhaps the trademark owner does not earn enough money from using the mark to justify keeping the registered mark. Or perhaps the parties have agreed to surrender registration as part of a trademark dispute settlement.
In these circumstances, the costs of trademark cancellation can affect the resolution of the dispute.
Trademark Cancellation Proceeding Venue
Trademark cancellations can only be made before the TTAB which has its own rules for oppositions and cancellations. The main difference between a traditional trademark infringement litigation in court and the TTAB is that the TTAB is only concerned about the cancellation of the mark at dispute. No monetary or punitive damage is addressed in the cancellation proceeding.
The Petition to Cancel can be filed with TTAB within five years of the trademark registration date. The entire trademark cancellation proceeding is done electronically by uploading and downloading the relevant files through TTAB’s ESTTA system (Electronic System for Trademark Trials & Appeals).
Either party may request a phone conference with the TTAB attorney who is handling the case. Rarely, the TTAB will grant an oral hearing request. The TTAB will issue a trial plan with deadlines that span 12-18 months. The average trademark cancellation hearing takes between 30 and 36 months.
Standing to file an Opposition or Cancellation
If you have applied for trademark registration, you may wonder if you have the standing to file an opposition or cancellation of that trademark. A request to cancel must be filed by a plaintiff (or “petitioner”) who has a reasonable basis to believe that the trademark’s registration is causing them harm.
This is known as “Standing”. It is usually not difficult for plaintiffs, especially if they are alleging trademark confusion and infringement, to show they have a basis for their cancellation request.
Importantly, trademark cancellation proceedings can only be initiated by petitioners challenging trademarks that have been registered. If the trademark is still pending registration the petitioner/plaintiff must instead initiate a Trademark Opposition proceeding.
The United States Patent and Trademark Office publishes all preliminarily approved trademarks for the opposition. A third party can challenge the trademark application during this 30-day period and present evidence that could prevent the final approval of a trademark registry.
Grounds for Cancelling Marks
In your legal briefing, you must prove that the trademark will cause harm to your business. A plaintiff can file a trademark cancellation for a variety of reasons, including:
Fraud
To show “Fraud” an applicant must have been found guilty of making a major misrepresentation to USPTO regarding a trademark application and must have had a specific intent to deceive USPTO.
This ruling was extremely difficult for an entity to cancel an application of another person on the grounds of Fraud. According to the Court, circumstantial evidence, rather than direct, may be sufficient to prove fraud.
No bona fide intent to use for ITU application
If the petitioner is unable to prove an adversary’s intent to deceive USPTO, the Petitioner might want to try to show that the competitor-applicant never intended to use the goods/services stated in the original “Intent to Use” trademark application.
A successful fraud claim does not remove trademark protection for items listed in the trademark registration or application. However, a successful challenge of a bonafide intent-to-use only invalidates trademark protection for goods and services for which there is no evidence.
Non-use or Abandonment
A no-use action may be possible if a trademark application has been filed under 1 (a) of the Trademark Act. If the applicant fails or is not allowed to use the trademark with any goods or services that are associated with the trademark registered trademark, the trademark can be canceled.
If the plaintiff can show that the mark was not used for at least three years consecutively, this is considered “Prima facie evidence (or abandonment)”. The trademark owner must continue to use trademarks and keep records of their consistent and continued use.
If the trademark registration has multiple classes of goods/services, registration can be canceled for non-use of some listed goods/services and if all of the goods/services mentioned in the filing are no longer being used, the plaintiff can seek a total cancellation of the registration.
Likelihood of Confusion
Trademark Act 2 (d) states that marks that are so similar to trademarks already registered in the USPTO or marks protected by Common Law trademark rights.
The test is whether the mark is sufficiently similar given the nature of the products being sold under the trademarks to cause confusion for consumers. The likelihood of confusion cancellation request must be filed within five years of the date of registration of the senior trademark.
Generic or Merely Descriptive
An applicant may petition to cancel your registration on grounds that the mark’s generic nature is a problem. If you have owned your trademark for longer than five years (incontestable), this is one ground to overcome this challenge.
Informational and Failure to Function
A trademark’s purpose is to identify the origin of goods or services. If your registration is not sufficient to convey an informational matter, others may attempt to cancel it.
Dilution of Existing Mark
This claim requires the plaintiff to own a famous mark and thus fewer companies’ quality for the fame and popularity of the plaintiff’s trademark. The trademark owner can rely on “Dilution” based on tarnishment of the mark that allows it to object to the use of its trademark in this way without needing to argue that there would be a Likelihood of Confusion.
Steps to take if You Want to Cancel A Mark
If you want to use a mark owned by another and have a solid basis for attacking the registered mark, you should consider filing a petition for trademark cancellation. This action is not always straightforward.
However, you must consider some key factors to ensure the success of your trademark cancellation strategy. The priority date of your trademark is an essential factor to consider, as is the likelihood of confusion.
First, you must file a Petition for Trademark Cancellation with the USPTO. This document provides basic information about the cancellation process and identifies the petition number. It also includes a schedule of important deadlines.
The schedule of the proceedings is often subject to change by either party, but the trademark cancellation process will usually take at least six months. You can get a free estimate from a trademark attorney.
The next step in pursuing trademark cancellation is deciding what grounds to assert. You may assert any of these grounds in your trademark cancellation petition. If you want to apply for partial or complete cancellation, you must ensure that your mark has not been actively used for three years.
If it has been for more than three years, you may want to wait a little longer before filing your petition. In this case, the burden of proof is on the defendant.
While a trademark cancellation is possible, it’s not a decision that comes easily. You’ll need to take the lead in the case and work with an IP attorney to ensure the best possible outcome.
In addition, there are some exceptions to this general rule. In particular, your trademark registration must have been canceled as a brand or a descriptive term. If you have made this mistake, you may lose the right to use it in the future.
You must file a petition with the United States Patent and Trademark Office to pursue trademark cancellation. You must file a petition within five years of trademark registration.
Step to take if you received a Cancellation Notice
The defense against a cancellation proceeding requires you to refute the same allegations as the complaint. Attacking the plaintiff’s “Standing”, which is the simplest and easiest, will allow you to ask yourself if the plaintiff has a valid, personal and relevant grievance. If so, the case is dismissed.
What about the 5-year limit? If the time limits are exceeded, the case should be closed on procedural grounds. If the case is allowed to proceed, the defendant should focus on the substantive claims in Cancellation proceedings.
If Trademark Cancellation is based on a 2d Likelihood of Confusion issue, then the defendant must prove that there is no likelihood that confusion. This is usually done by demonstrating the differences between the marks and/or goods/services.
If the defendant has strong Counterclaims that are similar to those in the Complaint it is important to identify and bring them forward with the Response to the Complaint.
TTAB Expedited Cancellation Pilot Program
The PTO is trying to remove registered marks that are no longer used. Through the Expedited Cancellation Pilot Program, the TTAB has made it easier and more efficient to cancel trademarks.
The Trademark Trial and Appeal Board has taken major steps to streamline and cleanse the registration of trademarks. They have removed antiquated trademarks from the register that are not used in commerce. The pilot addresses mark where the only grounds for cancellation are abandonment or non-use.
The pilot allowed the TTAB to identify newly filed cancellation proceedings that were limited to abandonment and non-use claims and did not result in a default judgment, to engage and encourage the parties, and to agree to some form of the Board’s existing Accelerated Case Resolutions (ACR).
The TTAB is well-known for offering ACR in interpreting proceedings. This allows parties to speed up and save time, as well as allowing them to reduce costs. ACR proceedings have the same standards of proof as traditional proceedings. A final decision made under ACR can be appealed in exactly the same way and within the same timeframes as non-ACR decisions.
The TTAB identified cancellations involving abandonment or non-use as eligible for the program between March 2018 and February 2020. Once an answer had been filed, the TTAB interlocutory lawyer informed the parties that they would be participating in the mandatory settlement and discovery conference (discovery conference).
The interlocutory lawyer advised parties to familiarize themselves with ACR before the conference. This included reviewing TBMP SSSS 528.05 (a)(2), and 702.04). They should also be prepared to discuss any ACR measures they may agree to.
The conference was attended by the interlocutory lawyer and one of the administrative trademark judges who were supervising the pilot program. The conference judge would not be later assigned to the panel judges who would decide the case on its merits. These conferences covered the usual topics of a discovery conference. They also explored possible stipulations and evidentiary stipulations.