Avoiding Trademark and Domain Name Scams

It’s only a matter of time.  If you own a trademark application or registration, at some point, you are going to receive a fraudulent request to make a payment or take some other unnecessary action relating to the trademark or a related domain name.  At first glance, these fraudulent requests may appear legitimate, but they are invariably scams of one sort or another.  The following outlines how to avoid the most common scams.

The Fraudulent Trademark Invoice Scam

The most common trademark scam is the fraudulent invoice scam.  This scam, which usually involves U.S. trademarks (but sometimes involves foreign trademarks), is very simple.  The scammers send invoices to trademark owners indicating that some action must be undertaken in connection with the owner’s applications or registrations, such as “publication,” “registration,” “renewal,” or “recordation,” and that, if payment is not sent by a certain date, the trademark owner’s rights will be adversely affected.  The invoices are usually for about $500-$2000.

Many trademark owners pay these fraudulent invoices because they tend to look authentic.  The invoices often use official sounding names, such as the “United States Trademark Maintenance Service,” the “Patent and Trademark Organization,” and the “Trademark Office, Ltd.”  One scammer even uses the name “Patent & Trademark Office,” which is virtually identical to the official name of the real Patent and Trademark Office.  In addition, the invoices often include the details of the trademark owner’s applications and registrations, such as the filing date, application number, registration date, and registration number.

However, none of these invoices are authentic.  They are fakes, and paying them will not benefit the trademark owner in any way.  The scammers will take the trademark owner’s money, and in most cases, they will not do anything in return.  Moreover, if a trademark owner pays a fraudulent invoice, there is little or no recourse.  Most scammers are located abroad, and as a result, there is usually no way to contact them or take action against them.  One scammer, operating under the names “Trademark Clearance Center” and “Trademark Compliance Office,” was recently prosecuted.  However, this is the first time a trademark scammer has ever been prosecuted, and while the scammer was in business, he is believed to have collected $1.85 million over a two-year span.  Clearly, trademark scammers operate with near impunity, and thousands of trademark owners pay their fraudulent invoices every year.

The only way to avoid falling prey to this scam is to refrain from paying any trademark invoices from unknown sources, no matter how authentic they may seem.  Such invoices cannot possibly be authentic for the simple reason that legitimate requests for payment will only come from the PTO or the trademark owner’s attorney.  All official correspondence relating to U.S. trademark applications and registrations will be from the “United States Patent and Trademark Office” in Alexandria, Virginia, and if by email, from the domain “@uspto.gov.”  Such correspondence will be delivered directly to the trademark owner (if an attorney is not identified in the application or registration) or to the trademark owner’s attorney (if an attorney has been identified).  Moreover, the PTO will never send a trademark owner or the owner’s attorney an invoice.  PTO fees are almost always due when documents are filed, and if additional payment is ever required, the trademark owner or the owner’s attorney will be notified through a PTO “Office Action,” not an invoice.  In brief, any request for payment that does not come from the PTO or the trademark owner’s attorney is, by definition, fraudulent.

The Foreign Domain Name Registrar Scam

The most common domain name scam is the foreign registrar scam.  This scam involves emails from foreign domain name registrars (foreign companies authorized to register country-code top-level domains, such as .cn for China), or companies purporting to be foreign name registrars, alerting trademark owners that foreign companies are seeking to register domain names incorporating the marks.  The emails typically indicate that the registrars are aware of the trademark owners’ rights, that they have placed the domain names on hold for a brief period of time to give the owners an opportunity to register the names, and that, if the owners fail to act, the names will be registered to the foreign company.  Basically, the registrars are attempting to pressure trademark owners into buying the domain names by misleading the owners into believing foreign companies are trying to purchase the names.  Numerous trademark owners have been tricked by this scam, especially when the emails are from registrars who operate authentic-looking websites, which tends to cause the owners to let their guard down.

Sometimes the scammers register the foreign domain names, and sometimes they disappear after receiving payment.  However, even when trademark owners acquire the names, they are usually purchased at inflated prices.  Moreover, the purchases are often unnecessary.  No one is attempting to register the foreign domain names, and as a result, there is no reason to register them.  This is not to say that trademark owners should never register foreign domain names—they should register such names if doing so makes commercial sense—but there is no need to register the names as a result of this scam.

The best defense against this scam is simply to ignore all emails from unknown sources containing warnings about the registration of foreign domain names, no matter how authentic the emails or the companies sending the emails may seem.  The clearest indication that the emails are fakes is that they indicate the registrar is aware of the trademark owner’s rights and has placed the foreign domain name registrations on hold.  Domain name registrars do not research whether anyone has prior rights in a domain name, and there is no procedure for placing holds on domain name registrations.  As in the United States, foreign domain names are registered on a first come, first served basis.  Further, in most cases, domain name disputes can only be resolved through the arbitration procedures set forth in domain name registration agreements.  Another sign that the emails are fakes is that the cost of the foreign domain names is several times higher than the usual domain name price of about $10-$20.  Finally, the emails usually contain generic salutations, such as “Dear Sirs,” and they tend to be poorly written.  Any emails meeting some or all of these criteria are scams.

Questions About Scams

The fraudulent invoice and foreign registrar scams are the most common trademark and domain name scams, but there are many others.  If you have any questions about whether a particular invoice or email is a scam, it should be treated with caution and you should contact an attorney before responding.

The Effect of TTAB Proceedings on Federal Court Litigation

The U.S. Supreme Court’s recent trademark decision in B&B Hardware v. Hargis Industries (March 25, 2015) has generated a substantial amount of concern. According to some lawyers, there has been a sea change in the law. They say the Supreme Court’s decision means that, once the Trademark Trial and Appeal Board (“TTAB”) (the judicial arm of the PTO) decides whether there is a conflict between two trademarks, the same issue can never be decided by the federal courts. They say this increases the importance of TTAB decisions, and hence the amount of money that litigants will spend on TTAB actions. Time will tell if B&B has a major effect on trademark law, but for the time being, there is no reason to expect that the Supreme Court’s decision will have a substantial impact on TTAB actions or will significantly increase their cost.

The precise question in B&B was whether a “likelihood of confusion” decision by the TTAB can be binding on federal courts under the doctrine of “issue preclusion” (i.e., the doctrine that earlier decisions trump later ones if the parties and the issues are the same). Some say this should never be the case because the TTAB’s likelihood-of-confusion decisions are fundamentally different from federal courts’ likelihood-of-confusion decisions. The TTAB decides whether a mark is entitled to registration over another mark based on a comparison of the marks as shown in the parties’ trademark applications or registrations, whereas federal courts decide whether a mark infringes another mark, based on a comparison of the marks as used in the marketplace. In other words, both the TTAB and federal courts decide likelihood of confusion issues, but they are looking at different things. The TTAB focuses on the parties’ applications and registrations, whereas the federal courts focus on what happens in the real world. This is the primary reason why some commentators believe that TTAB decisions can never be binding on federal courts.

However, B&B dispels this misconception and clarifies that TTAB decisions can be binding on federal courts in certain limited circumstances. What if the marks considered by the TTAB (the marks as they appear in the parties’ applications and registrations) are essentially the same as the marks considered by a federal court (the marks as they are used in the marketplace)? In those limited circumstances, and only in those limited circumstances, the TTAB and the federal courts are looking at the same things, and there is no reason why the decisions of the TTAB should not be binding on federal courts. Conversely, when the marks considered by the TTAB and the federal court are different, the TTAB’s decision will not be binding. This is exactly what the Supreme Court held.

According to the B&B decision:

If a mark owner uses its mark in ways that are materially the same as the usages included in its registration application, then the TTAB is deciding the same likelihood-of-confusion issue as a district court in infringement litigation. By contrast, if a mark owner uses its mark in ways that are materially unlike the usages in its application, then the TTAB is not deciding the same issue. Thus, if the TTAB does not consider the marketplace usage of the parties’ marks, the TTAB’s decision should “have no later preclusive effect in a suit where actual usage in the marketplace is the paramount issue.”(Citation omitted.)

Thus, B&B is an important clarifying decision, but it does not signal a major shift it trademark law.  In fact, B&B will probably not apply in the majority of cases. B&B will only apply when the marks considered by the TTAB and federal courts are essentially the same, without the addition or subtraction of any, words, letters, numbers, designs, or trade dress having trademark significance, and without any significant differences in the parties’ goods, customers, channels of trade, etc. Even the Supreme Court notes that B&B will not apply in most cases. According to the court:

[A]s explained [in this decision], for a great many registration decisions issue preclusion obviously will not apply because the ordinary elements [most importantly, the element that the issues must be the same in the two proceedings] will not be met. For those registrations, nothing we say today is relevant.

Further, while B&B may prompt some litigants to spend more money on TTAB actions, there is no reason why they should adopt such a strategy, unless the proceedings involve the parties’ marks as used in the marketplace (which is often not the case in TTAB actions), and unless the TTAB discusses such uses (which, again, is often not the case in TTAB actions).

None of this is to say that B&B is irrelevant.  While B&B may not have created a tidal wave, it has certainly created waves, and trademark owners will need to take account of its implications in the future.

U.S. Patent Claims: An Introduction for the Patent-Newbie

If you are reading this, then some twist of fate has created a compelling need for you to become acquainted with one of the fundamental concepts in U.S. patent law, namely patent claims. Welcome, patent newbie! For most lay people, patent law is like a giant loaf of dry white toast. And, newbie, you’re about to consume a few slices of that dry white toast. Bon appetite!

A more helpful (but less amusing) metaphor is a fence, namely a physical structure often used to mark the perimeter of a person’s plot of land. Claims are the part of a patent which defines the scope of protection which the patent provides for an invention. The land enclosed by a fence is land from which the land owner can exclude the presence of others (would-be trespassers). Subject matter that falls within (or is enclosed by) the scope of a patent’s claims is subject matter which the patent owner can exclude others from making, using and/or selling. Hence, a patent claim is like a fence.

Constructing a fence to enclose the plot of land is analogous to preparing, filing and then prosecuting a patent application. The land itself is like the specification of the patent application. A map of the land is like the drawings of the patent application. Patents typically include multiple claims of varying scope. Such claims are like nested fences.

If you hunger for more dry white toast, an expanded version of this discussion can be found at this link. The expanded version explores the fence-analogy via a detailed, hypothetical example set in the late 1880’s in the USA, during the era of the “land rush” (or “land run”).

Key Considerations in Patent Monetization

Corporations and individual patent owners alike are more interested than ever in seeking to generate revenue from their patent holdings. That revenue can come in the form of a one-time lump sum payment, a running royalty stream, some combination of both or even some other creative financial structure. Companies both large and small may be willing to license or sell patents in their portfolio that are non-core to their business. Alternatively, a strategic decision may be made to license or sell a patent even if it does cover a core aspect of the ongoing business. In this latter case, the sale or license may be conditioned on a grant-back of license rights and/or other rights such as rights to improvements so as to minimize the impact to the company’s IP position in the context of such a sale or license. In the case of individual patent holders, the sale or license of patent assets may be more of a financial decision with less concern for the operational impact of such a transaction.
There exist a great many professionals that offer patent marketing services with the goal of generating revenue based on patent assets whether the ultimate transaction is a license or sale or some form of hybrid arrangement. These professionals come from a many diverse backgrounds such as patent attorneys, licensing professionals, marketers, business development professionals and technologists. Often, these service providers will comprise a team of individuals with the collective skill sets which are desirable in achieving the best result.
It is very difficult to determine a strict value for a particular patent or a portfolio given the many variables that go into the determination. In the end and in the context of a non-litigious business transaction, the patent or portfolio is only worth what a willing buyer will pay for the relevant patent assets. That being said, there are some key indicators that are important in assessing potential value of a patent portfolio. For example, one key factor is the scope of potential infringement (current, present and expected future) in the market. Another important factor is the inherent strength of the patent or set of patents. This includes, for example, the breadth and clarity of the claims as well as the extent and clarity of the disclosure in the patent. Patent strength is also dependent upon the prior art (of record and not of record) as that prior art applies to the issued claim set. An often overlooked factor in assessing potential value of a patent portfolio is the condition of the patent sale and purchase market at the time of the marketing. If there are many buyers at the specific time, then the portfolio is likely to fetch a higher price than if buyers are not relatively active, particularly if they are not currently active in the technology area represented by the portfolio.
There are many other factors that impact the ultimate expected sale price or license revenue which can be generated from a patent portfolio. If you or your company are interested in potentially unlocking the value of patent assets, then the best course of action is to locate a reputable patent monetization expert and ask for an assessment of your portfolio. In almost all cases, this can be done without charge and the expert should be able to provide a general idea of expected value and potential for a sale or successful licensing program. Some of these experts will market portfolios at no cost to the owner in return for a success based portion of the proceeds generated through the marketing of the assets.

“Lack of Intent to Use” – An Increasingly Common Weapon in Trademark Cases

The number of successful attacks on trademark applications and registrations based on a “lack of intent to use” has been increasing in recent years.

Trademark owners often include as many products and services in their applications as possible, describing their products and services in various ways, and listing assorted products and services related to their primary offerings. While this approach is understandable, it may lead to serious consequences. If the trademark owner cannot demonstrate an intent to use the mark for the all of the products and services in the application, the application and any registration resulting from the application may be in jeopardy.

Intent to Use

Intent-to-use trademark applications must include a declaration indicating that the owner has a “bona fide” intent to use the mark in U.S. commerce for the products and services in the application. The same is true of trademark applications based on foreign applications, foreign registrations, and Madrid Protocol registrations. A bona fide intent to use a trademark is an intent to commercialize the products and services in the application, not merely an intent to “lock up” or otherwise reserve rights in the mark.

Lack of Intent to Use

The USPTO generally accepts a trademark owner’s declaration of intent to use a mark at face value during the application process. This is not the case in opposition and cancellation proceedings before the USPTO’s Trademark Trial and Appeal Board (“TTAB”). Third parties can attack applications and registrations in such proceedings on the ground that the trademark owner lacked an intent to use the mark when the application was initially filed.

The TTAB has held that ascertaining whether the necessary intent exists is an “objective determination based on all of the circumstances” of a particular case. There are no hard-and- fast rules regarding the type of evidence required. In practice, however, the most important factor in finding a “lack of intent to use” is often the failure to produce documentary evidence of such intent—i.e., documentary evidence beyond the intent stated in the application. Mere statements of an intent to use a mark are insufficient to prove the trademark owner’s intent.

If the trademark owner cannot show the existence of a bona fide intent to use the mark for all of the products and services in the application, the TTAB will void the application or cancel any registration resulting from the application. If the trademark owner fails to prove the requisite intent for some of the products and services in an application or registration, the TTAB will delete those products and services, and in certain situations, it may delete the entire class in question.

Lack of Intent to Use Cases

The following are some recent TTAB cases involving the “lack of intent to use” doctrine:

  • Research in Motion Limited v. NBOR Corporation, 92 USPQ 1926 (TTAB 2009) (lack of intent to use found where applicant produced no evidence of “product design efforts, manufacturing efforts, graphic design efforts, test marketing, correspondence with prospective licensees, preparation of marketing plans or business plans, creation of labels, marketing or promotional materials, and the like.” “The absence of any documentary evidence on the part of an applicant regarding such intent constitutes objective proof that is sufficient to prove that the applicant lacks a bona fide intent to use its mark in commerce.”).
  • The Saul Zaentz Company d/b/a Tolkien Enterprises v. Joseph M. Bumb, 95 USPQ2d 1723 (TTAB 2010) (lack of intent to use found where applicant did not produce any evidence of intent other than documents submitted in connection with the application and several domain name registrations).
  • Spirits International, B.V. v. S.S. Taris Zeytin Ve Zeytinyagi Tarim Satis Kooperatifleri Birligi, 99 USPQ2d 1545 (TTAB 2011) (lack of intent to use found where applicant acknowledged it had no documents regarding its intent, such as promotional or marketing materials, and had not obtained any permits or approvals to import or sell the products covered by the application).
  • L’Oreal S.A. and L’Oreal USA, Inc. v. Robert Victor Marcon, 102 USPQ2d 1434 (TTAB 2012) (lack of intent to use found where applicant produced no documents evidencing the required intent; had no industry experience, partners, investors; and engaged in no concrete activities toward using the mark. Lack of documentation or other objective evidence “outweighs any subjective (or even sworn) intent to use the mark.”).
  • Swatch AG v. M.Z. Berger & Co., 108 USPQ2d 1463 (TTAB 2013) (lack of intent to use found where applicant only produced documents submitted in connection with the trademark application and internal documents showing the mark on mockups or renderings of a single product).


These and other “lack of intent to use” cases show that trademark owners may wish to consider documenting their steps to bring their products and services to market in certain circumstances, such as when their trademark applications cover long lists of products and services, many different types of products and services, or unique products or services. Trademark owners may have the requisite intent with regard to all of the products and services in their applications, but this may be irrelevant if evidence of such intent is unavailable.

Such evidence may include:

  1. Documents concerning the design, development, and manufacturing of the products or services;
  2. Documents concerning logos, advertising and promotional materials (including websites), and labeling and packaging for the products or services;
  3. Marketing plans or business plans concerning the products or services;
  4. Documents concerning marketing, advertising, and promotion of the products or services;
  5. Licensing and distribution agreements, and documents concerning the licensing and distribution of the products or services;
  6. Permits or approvals, and documents concerning permits or approvals required for the products or services;
  7. Invoices, purchase orders, and price quotes;
  8. Documents concerning, investor, partner, contractor, employment, and other relationships relating to the products or services; and
  9. Documents concerning the ability to offer the products and services.

There is no requirement that such evidence must be extensive. However, as the TTAB requires evidence relating to the mark shown in the application, it stands to reason that the evidence will be given most weight if it refers to the mark, not merely to the trademark owner’s products and services. Further, as the TTAB requires evidence relating to the use of the mark in U.S. commerce, evidence supplied by foreign applicant’s is likely to be considered most persuasive if it refers to the use of the mark in the United States, not merely to the use of the mark in the trademark owner’s home country.

As “lack of intent to use” claims have become an increasingly common weapon in trademark cases, trademark owners may need to memorialize the fact that they intend to use their marks to protect their rights.

Declaratory Judgment Actions in Intellectual Property Cases

When a company is accused of intellectual property infringement, it can respond in several ways. The accused party can agree to the other side’s demands. The accused party can try to negotiate with the other side. The accused party can reject the other side’s demands and adopt a wait-and-see approach. Or, in certain circumstances, the accused party can sue first.

When the accused party sues first, it files what is called a “declaratory judgment action” (sometimes called a “DJ action,” “pre-emptive lawsuit,” or “anticipatory lawsuit”). A declaratory judgment action is a special type of lawsuit where the accused party asks the court for a binding declaration that it has not infringed the other side’s rights. The accused party may gain a number of advantages by suing first, assuming it can satisfy the requirements for filing a declaratory judgment action.

Requirements for Filing Declaratory Judgment Actions

The U.S. Supreme Court adopted a new standard for filing declaratory judgment actions in 2007. The adoption of this standard is widely considered to have made it easier to file declaratory judgment actions. According to the Court’s decision in MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007), the main requirement for filing a declaratory judgment action is that a “substantial controversy” must exist between parties having “adverse legal interests,” as shown by “all the circumstances” of the case. The accused party cannot file a declaratory judgment action out of the blue. As the Court of Appeals for the Federal Circuit held in SanDisk Corp. v. STMicroelectronics, Inc., 480 F.3d 1372 (Fed. Cir. 2007), there must be “some affirmative act” by the accuser that creates a substantial controversy.

There are no set rules regarding the affirmative acts required to create declaratory judgment jurisdiction, but numerous types of acts have been found to trigger such jurisdiction, or to contribute to the exercise of such jurisdiction, including threats of litigation, accusations of infringement, offers to license intellectual property rights, and other actions that create a “reasonable apprehension of suit.”

If the accusing party has engaged in these types of acts, there is a significant chance that the court hearing the dispute will find a substantial controversy exists and exercise declaratory judgment jurisdiction. This is the case even if the accusing party denies an intent to file a lawsuit, but otherwise demonstrates such an intent, as occurred in SanDisk v. STMicroelectronics.

Advantages of Filing Declaratory Judgment Actions

Assuming the accused party can satisfy the requirements for filing a declaration judgment action, suing fist may provide the accused party with several advantages.

First, filing a declaratory judgment action may help set the tone of a dispute. The accused party can tell the court its side of the story first and, as a result, it can frame the dispute in a way that benefits its case. The accused party may find this approach preferable to merely responding to the accusing party’s version of events.

Second, suing first may help the accused party obtain a procedural advantage. The accused party in most lawsuits is the defendant, but in a declaratory judgment action, the accused party becomes the plaintiff. While both parties are responsible for the conduct of the litigation, acting as the plaintiff may help enable the accused party to take the initiative in several areas (such as serving discovery requests and filing motions), rather than always reacting to the other side’s initiatives and being on the defensive throughout the litigation.

Third, suing first may allow the accused party to select the court where the litigation will occur. This may provide the accused party with a legal advantage if the court follows law that is more favorable to the accused party than to the accusing party, or if the forum is more convenient to the accused party than other forums. The accusing party may try to disturb the accused party’s choice of forum by filing its own lawsuit, but the accused party’s choice of forum is generally entitled to substantial weight under the “first to file” rule.

Fourth, as a practical matter, suing first may place unexpected budgetary and other pressures on the accusing party. This may lead to early settlement negotiations, and perhaps to a better result for the accused party than otherwise would have been possible.

Implications for the Accused and the Accuser

In view of the new standard for filing declaratory judgment actions and the potential advantages of suing first, companies accused of intellectual property infringement may have increased incentives to initiate litigation in response to such accusations.  Conversely, companies accusing others of intellectual property infringement may have increased incentives to adopt a cautious approach in cease-and-desist letter, demand letters, and other communications with infringers when they wish to avoid litigation, or to sue first when they wish to preserve their right to choose the time and place of such litigation.

The Importance of the Rocket Docket Under the America Invents Act

The America Invents Act (AIA) has elevated the status of the United States District Court for the Eastern District of Virginia (Eastern District).  The Eastern District is a speedy no-nonsense federal court with the well-earned reputation as the “Rocket Docket.”  The United States Patent and Trademark Office (USPTO) is located in Alexandria, Virginia, a short distance from the Alexandria Division of the Eastern District.  In 1999, under the American Inventors Protection Act (AIPA), 35 USC §1(b) provided that the USPTO “shall be deemed, for purposes of venue in civil actions, to be a resident of the district in which its principal office is located, except where jurisdiction is otherwise provided by law.”  Despite this close proximity to the Virginia federal court, prior to the AIA, certain actions were required to be filed in the U.S. District Court for the District of Columbia.  The AIA rectified that anomaly.

The Patent Statute, 35 USC §145, provides for a civil action to obtain a patent in the event that an applicant is dissatisfied with the decision of the Patent Trial and Appeal Board of the USPTO.  That provision formerly provided jurisdiction for such action in the D.C. federal court.  The AIA amended the provision to change the venue of such civil action to the Eastern District, consistent with the venue provision of 35 USC §1(b).

Similarly, the AIA, pursuant to 35 USC §146, provides for a civil action in case of a derivation proceeding in which any party is dissatisfied with the decision of the Patent Trial and Appeal Board.  Such civil action challenging the derivation decision is to be brought in the Eastern District, again in conformance with 35 USC §1(b).

Finally, the Patent Statute provides for the appeal of a patent term adjustment determination under 35 USC §154(b)(4)(A).  The AIA amendment changed the jurisdiction for such appeal from the D.C. federal court to the Eastern District, as contemplated under 35 USC §1(b).

In addition to the Eastern District having jurisdiction over the three appeals of actions before the USPTO, the AIA amended 35 USC §293 to confer jurisdiction of the Eastern District over proceedings affecting patent rights over nonresident patentees who have not designated a representative upon whom service of process or notice of proceedings may be served.  Thus, foreign owners of U.S. patents may unwittingly become subject to jurisdiction of the Rocket Docket in actions such as declaratory judgment actions.

The rapidity of proceedings before the Eastern District is largely the result of the Local Rules of that court.  Because the AIA has now conferred jurisdiction upon the Eastern District for the actions mentioned above, patent applicants and nonresident foreign patent owners need to be cognizant of those Local Rules.  Because the USPTO is located in Alexandria, pursuant to Local Rule 3(C), the Alexandria Division is the proper division for such actions in the Eastern District. The dilatory tactics frequently employed by litigants in other federal courts will not be countenanced by the Eastern District.  This is especially the case for discovery.  Local Rule 26(C) provides that objections must be filed within 15 days of service of discovery requests.  This permits expedited time for motions to compel to be briefed and argued under Local Rules 7(F) and 37 so that prompt responses close to the 30 day response times set forth in the Federal Rules of Civil Procedure can be obtained.

The Eastern District does not currently have patent-specific local rules, nothwithstanding the court’s elevated status in the patent realm.  Nonetheless, patentees and patent applicants need to be aware of the Eastern District and its importance under the AIA.

The Phillies Strike Out At The TTAB

If you are a fan of the Philadelphia Phillies you probably already know it has been a tough season. The team has lost more often than it has won and now the losing streak extends to the TTAB. See the recently published case The Phillies v. Phila. Consol. Holding Corp., T.T.A.B., No. 91199364, decided August 19, 2013, (precedential), at http://ttabvue.uspto.gov/ttabvue/ttabvue-91199364-OPP-25.pdf. In this case the TTAB found that a request for 507 admissions is not per se oppressive or unreasonable, which is the standard for issuing a protective order under Fed.R.Civ.P.26 (c)(1).

The Phillies opposed applications for GREENPHLY (and design of a globe) and TEAMPHLY (and design of the Liberty Bell) for a variety of services, including insurance services, charitable fundraising services, and organizing community sporting and cultural events. The Notice of Opposition relied on 26 trademarks that covered a broad scope of goods and services. The Applicant served The Phillies with 507 requests for admission, requiring them to admit or deny whether it was selling or licensing specific goods and services under the pleaded marks. The Phillies responded by filing a motion for a protective order arguing in part that the requests were unduly burdensome. The TTAB declined to issue the protective order against all of the 507 requests on the ground that The Phillies did not show good cause as the number of requests was high because counsel for The Phillies chose to draft the Notice of Opposition broadly and plead 26 marks, many of which were cumulative in nature. The Board did however issue a protective order against 96 of the requests noting that those requests were duplicative or outside of the scope of discovery.

A lesson in The Phillies case is that one should be careful in drafting a Notice of Opposition and balance the benefits of including all possible registrations and applications against the disadvantages of overly complicating a case.  Pleading numerous trademark registrations and applications inevitably leads to a dramatic increase in the effort and costs associated with the discovery phase of a case. This may be unnecessary if the registrations and applications are duplicative in nature.

Patent Office After Final Consideration Pilot (AFCP) 2.0 Launched

After receiving a final Office Action, a patent applicant typically has a decision to make whether to appeal the decision or to request continued examination by the Examiner assigned to the application. If allowance of the application can be achieved by correcting informalities, the Examiner usually permits that without the filing of a Request for Cotinued Examination (RCE). However, the Examiner will generally refuse to enter or consider any substantive amendment without the filing of an RCE.

Most patent practitioners generally prefer filing an RCE due to the time and expense of an appeal, unless they have reached a true impasse with the Examiner. However, RCE filing fees can be significant and RCEs have recently resulted in long delays as well due to the recent change in Examiner incentives that discourages them from acting on RCEs.

To address concerns about rising costs and delays associated with RCE practice, the USPTO has instituted a pilot program to encourage the resolution of issues after final without the need for filing an RCE. The program provides additional time (three hours) for Examiners to review and search after-final amendments without RCEs and for interviews to discuss the results of the review.

To participate in the program, applicants should submit a request to participate in the AFCP using the USPTO form SB/434, along with a response and amendment as normal (the amendment may not broaden the scope of the claim in any way). The Examiner will make an independent determination as to whether the amendment can be reviewed in the time provided. If so, the Examiner will fully consider the amendment, and either send a notice of allowance or contact the applicant to arrange an interview to discuss the results of the search and why the application cannot be allowed.

If the application is not allowed, after the interview the Examiner will send an advisory action as normal. The applicant will then be back in the position of deciding between an RCE and a notice of appeal, without receiving any additional time. However, the Applicant will have the advantage of having the previous amendment already entered, searched, and discussed. This should lead to more progress towards allowance in a shorter period of time.

Under the AFCP, substantial amendments requiring significant search time will not be considered. However, after-final amendments are frequently fairly minor, and therefore the program could often be useful. The main downside comes from timing issues. Filing the request for after-final consideration and amendment does not give the applicant any additional time to file an RCE or notice of appeal, in the event that the amendment does not result in allowance.

That means that the Applicant will have to act very early after receiving the final Office Action to avoid costly extensions or even abandonment. An applicant filing the request at the three-month deadline might not hear back from the Examiner until two months later, necessitating a three-month extension along with the RCE or Notice of Appeal. A three-month extension is about the same cost as an RCE, so if the Applicant is not able to submit the request early it often makes more sense just to proceed with an RCE. On the other hand, for applicant and practitioners able to respond very quickly and likely avoid the need for extensions even if a notice of allowance is not received, the program may be useful.

The current version of this program runs through September 30, 2013. It is unclear what will happen after that time, but the USPTO will most likely consider the results of the program and either tweak it and run it again, or make it permanent. For applicants and patent practitioners, it is important to keep this program in mind while it is active.

Trademark Examiners: A Little Consistency Please!

Every lawyer who prosecutes trademarks knows that old adage that every case has to be considered on its own merits. But what do you do when an Examiner decides that a mark is entirely descriptive, and that decision goes against dozens of other marks on the Principal Register in which the legal basis is indistinguishable? Try using the Consistency Initiative of the Patent and Trademark Office.

Our firm represents a client that has several two-word marks using a descriptive word followed by the word CENTRAL for services of various kinds. When our troubles began, this client already had five registrations on the Principal Register and two pending applications in which the initial word had been disclaimed, but no disclaimer of CENTRAL had been required. Further, there were countless other registered marks in the same classes in which the same word, in the same secondary position, was not deemed descriptive.

Then I encountered an Examiner handling two newer applications that refused registration on the Principal Register because he considered the marks in their entirety to be merely descriptive. This was quite a blow to a client who was developing a family of marks and who was, in my opinion, fully justified in relying on the rights they had secured previously. Now the client was being told that at least a few of his marks were not entitled to full protection on the Principal Register. I put forth my best argument, including a rant about being “arbitrary and capricious”, but I got a final rejection, and was looking forward to a long and uncertain appeal.

Then I ran across the so-called “Consistency Initiative.” Here an applicant can bring to the attention of the Office those situations in which, in Applicant’s opinion, the Office has acted inconsistently in its treatment of pending applications or recent registrations (up to five years old.) I dashed off a one-page summary of my position and only a couple of weeks later, I was astonished that my petition was granted and the Examiner withdrew his objection.

Attorneys have to be able to rely on what they see in the records of the PTO in order to advise their clients, and when an Examiner takes a contrary position, the Consistency Initiative can be a very useful tool.