Trademark Cancellation Proceedings: A Complete Guide

A trademark cancellation proceeding is exactly what it sounds like. It’s a legal case, similar to a civil lawsuit (although it is by contrast processed in the Trademark Trial and Appeal Board (TTAB)), in which a complainant is provided with the opportunity to attack and ultimately cancel a defendant’s trademark rights. The fundamental purpose of a trademark cancellation proceeding is to allow?a new?trademark applicant to register a trademark which would otherwise be owned by a different party.

Principally, the process, governed by the Lanham Act, is designed to account for the situation whereby an individual is illicitly maintaining trademark rights, to the detriment of the plaintiff. Successfully prosecuting a trademark cancellation proceeding enables the aggrieved party to remedy the harm of the defendant maintaining his trademark rights.

Here’s what you need to know about trademark cancellation proceedings.

TRADEMARK CANCELLATION SECTION 8 – THE ESSENTIAL IDEA

The USPTO is chiefly concerned with maintaining and protecting the trademark rights of worthy owners. However, if the USPTO determines that an existing owner of a trademark does not have the right to the trademark, it will strip the applicant of the mark. If a junior applicant believes that a senior, existing applicant is negatively affecting and/or preventing its own mark from registering, the junior applicant can file a Petition for Cancellation before the United States Trademark Trial and Appeal Board (TTAB). Please note, this is different than a Trademark Opposition proceeding which occurs before the trademark has officially registered.

TRADEMARK LAW GOVERNED BY THE LANHAM ACT

The Lanham Act, officially known as the Trademark Act of 1946, is a federal statute in the United States that governs trademark law. It was enacted by President Truman and provides a comprehensive framework for the registration, protection, and enforcement of trademarks. The primary purpose of the Lanham Act is to prevent consumer confusion and deception in the marketplace by regulating the use of trademarks, service marks, and other identifying marks associated with goods and services. The Lanham Act not only grants offensive rights to the trademark holder but indeed provides for the means by which an individual may challenge the validity of the trademark under a cancellation proceeding.

Ultimately, the Lanham Act plays a crucial role in safeguarding the rights of trademark owners, promoting fair competition, and maintaining the integrity of the marketplace by regulating the use of trademarks and related aspects of intellectual property.

TRADEMARK CANCELLATION PROCEEDINGS VS. OPPOSITION PROCEEdINGS

Trademark cancellation and opposition are two distinct legal proceedings that occur during the registration process of a trademark. They involve different parties and serve different purposes:

Trademark Cancellation:

• A trademark cancellation proceeding takes place after a trademark has been registered with the relevant trademark office.
• It allows any interested party, such as a competitor or the public, to petition for the cancellation or invalidation of an existing trademark registration.
• The grounds for trademark cancellation can include issues such as non-use of the trademark, abandonment, fraud in the application process, genericness, or other factors that render the trademark registration invalid.
• Cancellation proceedings are typically initiated before the trademark office or a relevant administrative body, and they seek to remove the registered trademark from the official registry.

Trademark Opposition:

• A trademark opposition occurs during the application process of a trademark, before it is officially registered.
• It allows third parties to oppose the registration of a trademark that they believe conflicts with their own existing trademark rights or that violates other legal grounds for refusal.
• Opposition proceedings provide a formal mechanism for resolving conflicts between trademark applicants and third parties before the trademark is officially registered.
• Oppositions are often filed with the trademark office or a designated administrative body and involve presenting arguments, evidence, and legal reasons for why the applied-for trademark should not be registered.
• If an opposition is successful, it can result in the refusal of the trademark application or the need for the applicant to modify the application to address the concerns raised by the opposer.

In sum, trademark cancellation occurs after a trademark is registered and aims to invalidate an existing registration, while trademark opposition takes place during the application process and involves a third party objecting to the registration of a new trademark. Both procedures contribute to maintaining the integrity of the trademark system by addressing potential conflicts and ensuring that only valid and distinctive trademarks are registered and protected.

WHERE ARE TRADEMARK CANCELLATION PROCEEDINGS HELD?

Trademark cancellations are held before the?Trademark Trial and Appeal Board (TTAB)?of the USPTO. The TTAB is a governmental agency and as such, has its own set of rules governing both cancellations and oppositions. The main difference between the TTAB and a traditional trademark infringement proceeding in a court is that the TTAB is only concerned with answering one question; should the plaintiff be stripped of his trademark rights. The TTAB IS NOT interested nor capable of awarding monetary damages or indeed of issuing other punitive measures against the loser in the case.

There are no in-person court hearings during trademark cancellation proceedings. The entire process is conducted through the digital process of uploading and downloading relevant files directly through TTAB’s proprietary ESTTA (Electronic System for Trademark Trials and Appeals. ?Phone conferences with the TTAB attorney assigned to the case may be requested by either party. In rare occasions, the TTAB will agree to an oral hearing upon request. The TTAB will issue a trial schedule with deadlines spanning 12 to 18 months. Most trademark cancellation hearings take a total of 30 to 36 months from start to finish.

WHEN CAN A TRADEMARK CANCELLATION PROCEEDING BE FILED?

Like every else involving the USPTO, timing is key. The time in which a cancellation proceeding must be filed is a function of the nature of the proceeding and the grounds upon which it sands. Ultimately, there are a few key benchmark dates that the Petitioner should keep in mind.

Trademark Cancellation within 5 years:

If the Petition to Cancel is filed with the TTAB within 5 years of the trademark registration date, the?grounds for the petition are more expansive and provides for a mechanism for addressing any potential issues with the trademark registration that might not have been discovered during the examination process. This could include situations where the registered trademark should not have been granted due to factors such as:

1. Non-Use: If the trademark owner has not made genuine use of the registered trademark in connection with the goods or services for which it was registered.
2. Abandonment: If the trademark owner has abandoned the use of the trademark, effectively rendering it inactive.
3. Genericness: If the trademark has become generic and no longer serves as a distinctive identifier of the source of goods or services.
4. Fraud: If the trademark registration was obtained through fraudulent or deceptive means.
5. Likelihood of Confusion: If the registered trademark is likely to cause confusion with another existing trademark.

Plaintiffs seeking to cancel a trademark within this must file a formal petition with the TTAB, presenting evidence and legal arguments to support the claim for cancellation.

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Trademark Cancellation AFTER 5 years:

After the initial five-year period following trademark registration has passed, grounds for canceling a trademark may still exist, but the procedures and requirements for seeking cancellation may differ from those within the first five years. Here are some common grounds for canceling a trademark registration after the initial five-year period:

1. Non-Use: If the trademark owner has not made genuine and continuous use of the registered trademark in connection with the goods or services covered by the registration for a certain period of time, it may be vulnerable to cancellation on the grounds of non-use. The required period of non-use and the evidence required to demonstrate non-use can vary by jurisdiction.
2. Abandonment: Similar to non-use, if the trademark owner has completely abandoned the use of the trademark without any intention to resume its use, the trademark registration may be canceled on grounds of abandonment.
3. Genericness: If the trademark has become generic over time and is commonly used to refer to a category of goods or services rather than indicating a specific source, it may be subject to cancellation.
4. Misrepresentation or Fraud: If it can be proven that the trademark registration was obtained through fraudulent or deceptive means, it might be subject to cancellation.
5. Bad Faith Registration: If it can be shown that the trademark was registered in bad faith or with the intent to unfairly compete, the registration might be subject to cancellation.

If you are considering seeking cancellation of a trademark registration after the initial five years, it’s advisable to consult with a trademark lawyer who specializes in this area of the law and is familiar with the laws and regulations in the relevant jurisdiction.

TRADEMARK CANCELLATION BURDEN OF PROOF

As the previous section just discussed, it is important to remember that trademark cancellation proceedings are bound by time-constraints and depending on the reason for the proceeding, must be filed against a defendant within five (5) years from the date of the registration of the trademark.

The plaintiff or “petitioner” who files a request for cancellation must have a reasonable basis for believing that they are being damaged by the trademark’s registration – this is called, “Standing”. It’s typically not too difficult for plaintiffs to show that they have a basis for the cancellation request—especially if they are alleging trademark confusion or infringement.

Critically, trademark cancellation proceedings are only available to petitioners who are challenging trademarks that have actually achieved Registration – if the trademark is still pending registration, the petitioner/plaintiff should instead commence a Trademark Opposition Proceeding. Recall, the United States Patent and Trademark Office (USPTO) publishes all preliminarily approved trademarks for opposition. It’s during this 30-day opposition period that a third party may challenge the trademark application and present evidence which may stop final approval of a trademark registration.

HOW TO FILE A PETITION TO CANCEL WITH THE TTAB

The mechanics for filing a Petition to Cancel may be found in the Trademark Trial and Appeal Board Manual of Procedure (TTAB). Specifically, under 15 U.S.C. § 1064 [Trademark Act § 14], “A petition to cancel a registration of a mark, stating the grounds relied upon, may, upon payment of the prescribed fee, be filed as follows by any person who believes that he is or will be damaged, including as a result of a likelihood of dilution by blurring or dilution by tarnishment under section 1125(c) of this title, by the registration of a mark on the principal register established by this Act…”

Simply, to file a Petition to Cancel with the TTAB, one must state the his/her interest in the case, the cause to action of the case (why the mark deserves to be canceled) and pay the required fee. Here’s a general overview of the steps you might need to take to file a trademark cancellation proceeding:

1. Consult an Attorney: Before proceeding, it’s highly recommended to consult with an experienced trademark attorney who is familiar with the laws in the relevant jurisdiction. Trademark law can be complex, and an attorney can provide guidance and ensure that you follow the correct procedures.
2. Grounds for Cancellation: Determine the grounds on which you are seeking to cancel the trademark. Common grounds include non-use, abandonment, genericness, descriptiveness, likelihood of confusion, fraud, bad faith, or prior rights.
3. Review Trademark Registration: Obtain a copy of the trademark registration you wish to challenge. Review the registration details, including the owner’s name, registration number, and the goods or services covered by the trademark.
4. Gather Evidence: Collect evidence to support your claim for cancellation. This could include documents, records, market research, and other materials that demonstrate the grounds for cancellation.
5. Prepare the Cancellation Petition: Work with your attorney to draft a formal petition for cancellation. The petition should clearly state the grounds for cancellation, provide supporting evidence, and explain why you believe the trademark registration should be canceled.
6. File the Petition: Submit the cancellation petition to the appropriate trademark office or administrative body. Follow their specific filing procedures, which may include completing application forms, paying filing fees, and submitting the required documentation.
7. Notification to Trademark Owner: In many cases, the trademark owner will be notified of the cancellation proceeding and given an opportunity to respond to the petition. The owner will have a chance to defend the validity of their trademark registration.
8. Proceedings: The cancellation proceeding may involve various stages, including the submission of evidence, legal arguments, and potentially oral hearings. Your attorney will guide you through each step and represent your interests.
9. Decision: The trademark office or administrative body will review the evidence and arguments presented by both parties and make a decision regarding the validity of the trademark registration. The decision may result in the cancellation of the trademark, its maintenance, or other outcomes.
10. Appeals: Depending on the outcome, there might be options for appeal if you or the trademark owner disagree with the decision.

It’s important to emphasize that the process outlined above is a general guide, and the specific steps and requirements can vary widely depending on the jurisdiction and the applicable laws. To ensure that you navigate the trademark cancellation proceeding correctly, it is strongly recommended to work closely with a qualified trademark attorney who can provide personalized advice and assistance throughout the process.

TTAB Expedited Cancellation Proceedings Program

The Trademark Trial and Appeal Board (TTAB) is taking major steps to cleanse and streamline the registration of new trademarks by effectuating the removal of antiquated trademarks listed in the register that are no longer used in commerce.

To achieve this aim, the Board has implemented a pilot program titled the “Expedited Cancellation Proceedings.” This program will abbreviate proceedings on marks when the only alleged grounds are non-use or abandonment.

The basic premise undergirding this new pilot program is that the TTAB will proactively identify newly-filed cancellation proceeds and screen them for abandonment or nonuse claims. Then, the TTAB will speed up the proceedings by allowing the cancellation proceedings to be reviewed under the Accelerated Case Resolution (ACR) procedures. In order to make this identification, the TTAB will assign an Interlocutory Attorney to review the cancellation proceeding and determine eligibility. However, notably, parties to the proceeding may elect to make use of the Pilot, even in the event that the case not initially selected for participation by the TTAB.

The TTAB is an active participant throughout the proceedings and during the Discovery Conference, both the Interlocutory Attorney AND an Administrative judge will participate.

The conference will evaluate all noteworthy subjects and will also weigh whether or not parties can bring forward certain facts and evidence, posit means to restrict discovery, and potentially come to terms on the use of the “summary judgment ACR” model. This model permits the Board to regard the motion as the final record and therefore serve as the determination of factual matters being argued.

Remember, trademark registrations often contain more than one class of goods/services and it is quite common for Applicants to have used some of the listed goods/services in commerce while completely neglecting others. In the event that ALL of the goods/services listed in the opponent’s application are no longer in use, the Petitioner should pursue a complete cancellation of the registration. If, however, only a portion of the goods or services have been abandoned, the Petitioner should then pursue only a partial cancellation. Those petitioners whose cancellation proceedings are not chosen for the pilot program, and who can find agreement with their opposing counsel on expedited hearings, should communicate with the Interlocutory Attorney to formally request their services.

In order for a Petitioner to succeed in an abandonment-based Cancellation Proceeding, the Petitioner must demonstrate first and foremost that he has “standing”, or legitimate interest in the case, in order have even the preliminary right to challenge the application. Assuming that the Petitioner can indeed demonstrate a legitimate interest in the case, or Standing, he next needs to meet the burden of making a “prima facie” case of abandonment via a preponderance of the evidence. What would such a case look like? Principally, it is the demonstration that the defendant has terminated use of the trademark vis-a-vis the indicated goods or services in the registration with a clear intention of not resuming usage. Alternatively, the Petitioner may decide instead to marshall forth evidence demonstrating that the Registrant has simply not actively used the trademark, vis-à-vis the goods/services, for a period of three consecutive years. Of course at that point, the burden shifts to the defendant who must counter the claims made by the plaintiff. And on and on it goes.

The key take-away here is that the TTAB has clearly and meaningfully expressed its disdain towards trademark holders who are illegitimately holding onto marks that they are no longer using. The TTAB, through the use of the Expedited Cancellation Pilot Program, has now enabled the cancellation process to proceed with greater ease and expediency.

UNDERSTANDING THE “GROUNDS” REQUIREMENTS FOR A TRADEMARK CANCELLATION PROCEEDING

While it is necessary for the plaintiff to show that he/she would be “damaged” in order to file a cancellation proceeding, this preliminary threshold issue is not enough to sustain a Cancellation Request – the plaintiff must also demonstrate why the trademark itself no longer warrants the protections afforded to Registered Trademarks. Some of the more common reasons a plaintiff may file a trademark cancellation include:

Trademark Cancellation on the Basis of Fraud:

Fraud claims are unfortunately, or fortunately depending on one’s perspective, challenging to enforce. This is especially the case since the Court of Appeals for the Federal Circuit heard the critically important case of In re Bose, 580 F.3d 1240, 91 USPQ 2d 1938 (Fed. Cir. 2009). Fraud, of course, is a legal term of art with a specific meaning in the context of the law; legal standards must be met before an inappropriate action to rise to the level of “Fraud.” Prior to In re Bose, an applicant simply had to have been found to have made a magterial misrepresentation to the USPTO concerning the trademark application that the applicant should have known to have been false or misleading. However, post In re Bose, the court narrowed the definition of “Fraud” to be far more constraining and found that there must be a specific intent on the part of the applicant to deceive the USPTO.

For an individual attempting to cancel another’s application on the basis of Fraud, this ruling made this task far more challenging. Naturally, it is immensely difficult for a petitioner to prove that a false statement contained within the trademark application was made with the intent to deceive the USPTO – a material misrepresentation alone does not prove intent to deceive when challenging a trademark application. However, if a petitioner alleges multiple claims of fraud against a trademark holder, only one of those claims needs to be substantiated to have the trademark application or registration voided. How does one go about demonstrating Fraud? The Court’s have held that circumstantial, rather than direct, evidence may suffice to prove Fraud.

Lacked Bona Fide Intent to Use:

Remember, trademark applications may be filed on an “Intent-to-Use” basis Section 1(b) of the15 U.S. Code § 1501, which simply says, “I am not using my trademark in commerce yet but I intend to use it in commerce.”

If a petitioner cannot satisfactorily demonstrate an adversary’s specific intent to deceive the USPTO, a Petitioner may very well want to consider attempting to demonstrate that the competitor-applicant never actually intended to use the goods/services as stated in the original “Intent-to-Use” trademark application.

However, unlike a successful claim of fraud which eliminates all trademark protection for the items listed in the trademark application or registration, a successful challenge to a bona fide intent-to-use only eliminates trademark protection only for the goods or services where no bona fide intent-to-use can be proven. See Saul Zaentz Company dba Tolkien Ent. v. Joseph M. Bumb, Opposition No. 91170589 (May 18, 2010).

Abandonment or Non-Use:

If a trademark application was filed under 1(a) of the Trademark Act, and the applicant fails to use the trademark with any of the goods or services associated with the registered trademark on or before the date of filing, a no-use action could be a viable challenge. If a court agrees that the trademark is not being used with any of the goods or services listed in the trademark application, the application can be declared void ab initio, and the trademark registration may be canceled. if the plaintiff can prove that the mark has not been used for three consecutive years, the nonuse constitutes “Prima facie evidence of Abandonment”. Defendants must therefore continue to make uses of trademarks and maintain records of the continued and consistent use of the trademark. Remember, trademark registrations often contain more than one class of goods/services and it is quite common for Applicants to have used some of the listed goods/services in commerce while completely neglecting others. In the event that ALL of the goods/services listed in the opponent’s application are no longer in use, the Petitioner should pursue a complete cancellation of the registration. If, however, only a portion of the goods or services have been abandoned, the Petitioner should then pursue only a partial cancellation. Those petitioners whose cancellation proceedings are not chosen for the pilot program, and who can find agreement with their opposing counsel on expedited hearings, should communicate with the Interlocutory Attorney to formally request their services.

In order for a Petitioner to succeed in an abandonment-based Cancellation Proceeding, the Petitioner must demonstrate first and foremost that he has “standing”, or legitimate interest in the case, in order have even the preliminary right to challenge the application. Assuming that the Petitioner can indeed demonstrate a legitimate interest in the case, or Standing, he next needs to meet the burden of making a “prima facie” case of abandonment via a preponderance of the evidence. What would such a case look like? Principally, it is the demonstration that the defendant has terminated use of the trademark vis-a-vis the indicated goods or services in the registration with a clear intention of not resuming usage. Alternatively, the Petitioner may decide instead to marshall forth evidence demonstrating that the Registrant has simply not actively used the trademark, vis-à-vis the goods/services, for a period of three consecutive years. Of course at that point, the burden shifts to the defendant who must counter the claims made by the plaintiff. And on and on it goes.

Likelihood of Confusion:

Under Trademark Act 2(d), marks that so resemble existing trademarks registered in the USPTO and/or marks protected under Common Law trademark jurisprudence are “Likely to Cause Consumer Confusion” and are therefore ineligible for registration. An owner of a trademark excessively similar to yours may claim that your trademark is causing “consumer confusion”. Remember – the test is not whether or not your plaintiff’s mark is identical to the defendant’s mark but rather whether or not the mark’s are sufficiently similar, given what is being sold under the banner of the trademarks, to cause consumer confusion. In order for a likelihood of confusion cancellation to be considered by TTAB, it must be filed within 5 years of your trademark’s registration date. If you’ve had your trademark for more than 5 years, then this cancellation request can be thrown out.

Generic or Merely Descriptive:

A petitioner may seek to cancel your registration on the grounds that the mark is generic. As with likelihood of confusion, this challenge can be thrown out by the TTAB if you’ve had your trademark for more than 5 years.

Informational or Failure to Function as a Trademark:

The purpose of a trademark is to identify the source of goods and services. Others may try to cancel your registration if it’s on the borderline of conveying informational matter.

Trademark Dilution:

This claim is slightly more challenging to actually enforce whose success will depend in large part on the fame and ubiquity of the plaintiff’s mark. Suppose for the moment that a Defendant managed to obtain a trademark registration on the mark MERCEDES, for the sale of Adult Magazines. Of course, no reasonable consumer would think that the Mercedes corportaion was behind the creation of these magazines (therefore eliminating a 2(d) Likelihood of Confusion issue) and yet somehow it doesn’t seem fair to tarnish Mercedes’ good name with such a controversial business. The “Dilution” argument manages to provide Mercedes with a way of objecting to its trademark being used in this manner without having to make the case that there would be Likelihood of Confusion.

HOW TO RESPOND TO A TRADEMARK CANCELLATION PROCEEDING

Naturally, defending against a cancellation proceeding involves rebutting the very same allegations made in the complaint. The simplest and most obvious place to start is by attacking the plaintiff’s “Standing” – does the plaintiff really have a legitimate, personal, and relevant grievance? If not, the case stops there and the complaint is tossed out. What about the 5-year time restriction? Again, if the time limits have been exceeded, the case should end on procedural grounds. Assuming the case can indeed proceed, the defendant must focus on the substantive claims in the Cancellation proceeding. If the Trademark Cancellation is predicated on a 2(d) Likelihood of Confusion issue, the defendant must show that that there is no likelihood of confusion, typically formulated by demonstrating the dissimilarity between the marks and/or goods/services.? In the event that the defendant has strong Counterclaims to those made in the Complaint, it is important to define and bring them forward in the Response to the Complaint.

Defense Example #1: Trademark Challenge Based on a No-Use Allegation:

When an applicant files for trademark protection under 1(a) of the Trademark Act and does not use the trademark in connection with all the goods or services listed on the application, the applicant has the right to amend the application. The applicant has two choices when amending the application to guard against a no-use challenge. One recourse is to ask the USPTO to remove the goods and services from the application where no-use was made. Another strategy to obviate the defect and protect the trademark is to request the application to be converted to a filing under 1(b) of the Trademark Act. This changes the application to an intent-to-use trademark filing, and may permit the trademark applicant to protect the future use of the trademark on those goods and services. There are other requirements for trademark protection to be extended under this section, and a lawyer experienced in Trademark Law can help identify when this strategy can defend a no-use allegation and protect the goods and services identified in the trademark application.

HOW MUCH DOES IT COST TO RESPOND TO A TRADEMARK CANCELLATION PROCEEDING?

On an administrative level, defendants in a trademark cancellation proceeding must of course consider the costs involved in mounting a defense and determine if it is indeed worth the time/money/energy/resources. In certain circumstances, it just doesn’t pay to respond to a complaint targeting a trademark if the defendant has no interest in maintaining the mark. The initial costs of responding to a petition to cancel will run somewhere in the $2,000 to $3,000 range and will vary according to the nature of the complaint and the sophistication of the claims. Once the response to the complaint is filed, there is a mandatory pre-trial settlement conference which will cost around $800-$1200. Unfortunately, from there, the costs only keep going up as the case moves through the mechanical procedures of a real litigation (discovery, trial etc.). There is no doubt that trademark cancellations are expensive for both the plaintiffs and defendants and must not be taken lightly.