New Trademark Procedures Make It Easier to Protect Your Brand

The United States Patent and Trademark Office (USPTO) has rolled out some new procedures of the recently passed Trademark Modernization Act (TMA) that will be helpful for trademark owners and their IP counsel. Two of the most important are as follows:

Expungement and Reexamination of Trademark Registrations.

This procedure will be helpful if you are applying for a trademark and your application is flagged due to a trademark registration that is considered a conflict. If you discover through your fact-finding that the conflicting trademark is not being used in commerce as it states in the registration (i.e., insufficient use or non-use of the goods or services described in the registration), then you can use one of the following methods to possibly cancel the registration and clear the path for your application.

Expungement

An expungement proceeding against a registered mark that is 3 to 10 years old that has never been used in commerce in connection with the registered goods and services will be canceled.

Reexamination

A reexamination proceeding against a registered mark less than five years old that was not in use for some or all of the goods or services when the registrant filed its declaration of use will be canceled.

Any party, regardless of standing, can challenge a registered trademark by filing either of the above. Once this filing is received, the Trademark Office will issue a notice (post-registration Office Action) to the registrant of the potentially bogus registration, and the registrant will have three months to prove that the claim is not valid. If the registrant cannot disprove the claim, the Trademark Office will cancel all or part of the registration.

Previously, the only way to cancel a fake registration was through a long and expensive TTAB cancellation proceeding. This new procedure is a quick and inexpensive way to overcome a sham registration that prevents your mark from registering.

Letter of Protest Decisions

This procedure previously existed; however, it was not very effective. The TMA has updated it so that it is more effective. This tool can be used when you discover that someone has filed a trademark application that you know is fraudulent. Common grounds for filing a letter of protest against a pending application include, but are not limited to, where the following exists: a likelihood of confusion with a prior pending application or registration owned by the protesting party, a term within the trademark that is allegedly generic or descriptive, a notice of a pending litigation matter involving the trademark, a known discrepancy of ownership exists (i.e., a contract exists that contradicts with the applicant), or an inappropriate specimen of use filed as part of the application.

For a nominal fee, anyone can file a letter of protest that details legitimate reasons why the fake trademark application should not be granted registration accompanied by supporting evidence. A USPTO Director first reviews the letter, who decides whether it should become part of the evaluation file that the application’s Examining Attorney should consider. If the Director accepts the letter of protest, the Examining Attorney must consider the evidence submitted in the protest when determining if there are reasonable grounds to refuse registration.

I believe that these two procedures will be valuable tools that your IP attorney can use to protect your brand!

Richard B. Jefferson, Esq.

Copyright Alternative in Small-Claims Enforcement Act of 2020 (CASE Act) Explained

The United States Copyright Office is establishing a Copyright Claims Board (CCB) to hear claims for disputes under $30,000, including those for take down violations. This will allow many copyright holders who would otherwise avoid suits for infringement an affordable alternative to Federal Court.  The party making a claim must have a valid copyright registration, or have an application pending. A process for expedited registration is being established. (See blog on expedited registration.)

A party may opt out of being heard by the CCB (without prejudice), and either party can still choose to make their case in Federal Court. However, claims and counterclaims cannot be filed in both venues. If a party does not opt out within 60 days of being served, the opportunity to file in federal court and the right to jury trial are waived.  Parties may be represented by an attorney or a law student certified to do pro bono representation.

The proceedings will take place online or by way of other telecommunications. There will be discovery limitations and formal motions will only be used on special request. The final written determination must come from a majority of the board, and these determinations will get posted to a public website with certain confidential information redacted.  Frivolous claims and those made in bad faith may result in sanctions. To prevent abusing the system a limit on the number of claims per party, per year is likely to be implemented.

Presently, the office is formulating regulations for operations and procedures including fee setting, an opt-out process, and decision review. NOTE: Claims made with the CCB cannot be appealed in federal court.  The board is expected to begin operation in Spring 2022.

How To Run A Legal Social Media Campaign

Many companies are using social media sweepstakes and contests, as promotional tools (there is a difference!). Some are done by in-house employees, but the majority of campaigns are either run by social media influencers or done as part of the services offered by public relations and consulting firms.

Who do you think is on the hook if a company, influencer, or PR/consulting firm fails to conduct a legal campaign? The answer is a no-brainer to the authorities, its the sponsoring company in each case because companies have an obligation to monitor what third parties do on their behalf.

Running a legal online promotion is not tricky, but noncompliance can be costly. Below are 5 essential things to consider before launching a social media campaign. Make sure you read to the end to have the opportunity to enter an actual sweepstakes!

 

1. IS YOUR CAMPAIGN A SWEEPSTAKES OR A CONTEST? 

In the eyes of the law, your campaign is a sweepstake, contest, or illegal lottery!

  • A sweepstakes is a promotion that anyone who validly enters has a free chance to win a specific prize. Breaking this down, a person does not need to pay or purchase anything to enter; the winner is randomly selected based on chance, and an identified prize of value will go to the winner. It has nothing to do with skill.

For example, the following promotion is considered a sweepstakes according to most state laws:

  1. Create a Playlist in your TIDAL account;
  2. Share your Playlist on Twitter and include the hashtag #sweepstakes to enter;
  3. A winner will be randomly selected on September 15 and win two free tickets to a Beyoncé/Jay-Z concert.
  • A contest is a promotion or competition that requires a person to use a particular skill, knowledge, or ability, and the winner of the prize is selected based on his or her ability. It has nothing to do with chance.

For example, the following campaign by a company is considered a contest according to most state laws:

  1. Create a video that contains your best Beyoncé and Jay Z impersonation;
  2. Post it, follow us, and add the hashtag #Contest to enter;
  3. The owner of the video that has the most likes on September 15 wins two free tickets to a Beyoncé/Jay-Z concert.
  • An illegal lottery is a campaign that has (whether or not intentional) the elements of chance, a prize, and requires entrants to pay or give some kind of consideration to enter. This is apparently what you want to avoid. It is not likely that a campaign that is intended to be a contest could accidentally morph into a lottery because as long as skill is required, the element of chance is not present. However, a sweepstakes can inadvertently require entrants to give or do something that could be considered “consideration” according to the law, which would make it an illegal lottery. This is why you have legal review your campaigns before making them public!

 

2. WHAT ARE YOUR CAMPAIGN RULES?

Your campaign should include specific rules to avoid problems, such as a complaint by an entrant that it is unfairly run. One complaint to a federal or state authority could quickly get you fined.

Federal law requires some campaigns to have specific conspicuous language (i.e., capitalized). Campaigns should also explicitly specify the details of the promotion. Generally, the following will be of interest to entrants:

  • Eligibility requirements (i.e., age, citizenship, geographic location)
  • How to enter
  • Entry limitations (i.e., 1 entry per household)
  • Beginning and end dates and times
  • Identify the prize and details, such as its pecuniary value
  • State the odds of winning or at least something like “odds of winning depends on the number of entries received”
  • Winner information, such as when the winner is chosen, how the winner is notified, and how the winner can claim his or her prize.

This is just an example list. A complete list would depend on your specific campaign.

 

3. ARE YOU SURE YOUR SWEEPSTAKES IS NOT AN ILLEGAL LOTTERY?

Many people interchange the words “contest” with “sweepstakes,” but, as stated above, it is critical to know the difference. A sweepstakes contains the elements of prize and chance, so if a person is required to pay or give something of value to enter then the law will consider your campaign an illegal lottery. It is generally accepted that the availability of a “free method” of participation that places all entrants on equal footing avoids the problem of consideration in a sweepstakes (i.e., NO PURCHASE NECESSARY).

 

4. DOES YOUR CAMPAIGN COMPLY WITH STATE, FEDERAL, AND INTERNATIONAL LAWS?

Federal agencies with jurisdiction to regulate sweepstakes and contest promotions include the Federal Trade Commission (“FTC”), the Federal Communications Commission (“FCC”), and the United States Department of Justice (“DOJ”). Federal law is mostly directed toward prohibiting false, deceptive or unfair acts related to advertising a promotion.

Most state laws regarding sweepstakes and contests are also geared toward preventing false, deceptive, or unfair acts and are widely similar; however, certain states are stricter than others. New York, Florida, Texas, and Rhode Island have the most stringent laws in the U.S., such as registration requirements where the approximate retail value (ARV) of a prize exceeds a specific dollar amount, or the campaign is connected to a retail establishment. 

If you are accepting entrants from outside the United States then you may have other laws to consider, such as the General Data Protection Regulation (GDPR) that applies to people located in the European Union.

 

5. DOES YOUR CAMPAIGN COMPLY WITH THE HOSTING PLATFORM’S RULES AND REGULATIONS?

In addition to legal concerns, you must comply with the rules and regulations for the social media platform that you are using to run your campaign. For example, Instagram requires you to state that it is not responsible for, sponsored, endorsed or administered by, or associated with your contest or what happens during. Here is a link so that you can see precisely what Instagram requires.

Lastly, be aware that it is not a good idea to change your sweepstakes rules after it has started. This could trigger potential penalties or fines.

– Richard B. Jefferson, Esq.

Disclaimer: Nothing stated in this blog is intended to be, or shall be considered, legal or other professional advice. To properly run a social media campaign you need to have a competent attorney assess your specific situation. Also, note that all of the disclaimers to this site also apply.