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USPTO announces new trademark sanctions process

June / July 2022 IP Newsletter

The U.S. Patent and Trademark Office (USPTO) has taken another step in its ongoing campaign to protect the integrity of the trademark register. It recently announced a new administrative process it will wield to investigate improper submissions filed with the USPTO in trademark matters.

Investigation can mean suspension

The agency will use the new process to investigate suspicious submissions related to trademark applications or registrations to determine whether they:

The USPTO may identify or otherwise learn of a suspicious submission through various means. Those include information received from internal sources (for example, examining attorneys and data analytics staff) or through external sources (for example, letters of protest, law enforcement, media reports or the agency’s scam-reporting email account).

Once an investigation is launched, the relevant trademark application(s) may be removed from examination status. In such circumstances, the agency will update the application’s prosecution history to indicate the application is suspended pending administrative review.

Any associated deadlines also are suspended. The applicant will be unable to make any electronic submissions other than an express abandonment of the application, a withdrawal of attorney or a petition to the USPTO director. If an applicant wishes to make an additional submission, it will need to file a petition to the director that satisfies the applicable requirements.

Cause required to shake sanctions

If an investigation turns up conduct that “illustrates violations” of the rules or terms of use — especially conduct suggesting an intent to circumvent USPTO rules — the agency may issue the individuals or entities involved an order to show cause. This is a type of court order demanding an explanation of why sanctions shouldn’t be imposed. Potential sanctions include:

The USPTO announcement of the new process notes that merely resubmitting documents or appointing a new attorney won’t preempt sanctions. The agency will set a deadline for responses to orders to show cause and consider only timely responses that explain why it shouldn’t impose sanctions.

The announcement also stresses that trademark applicants and registrants are responsible for all actions or omissions made by representatives on their behalf. Specifically, misrepresentation or deceit by a representative doesn’t necessarily constitute an “extraordinary situation” that might warrant a petition to the director to request suspension or waiver of a rule.

Sanctions throw a long shadow

Ultimately, the USPTO will issue a final decision that could include an order for sanctions. If an order calls for termination of a pending application, the agency will terminate that application and update its electronic records to indicate that the application was terminated on the entry of sanctions.

Applicants generally won’t be allowed to revive terminated applications unless they can demonstrate that the USPTO erred in including the application in the sanctions order. Rather, they’ll need to file new applications to seek registration of marks that were the subject of terminated applications.

When a sanction terminates an existing trademark registration, the USPTO will deem the sanctions order to be a final decision adverse to the owner’s right to keep the mark registered. These owners can file new applications for their marks.

If sanctioned actors continue to violate the USPTO rules or website terms of use, the agency may take additional actions to enforce sanctions orders. The announcement doesn’t go into detail on what such actions might entail, though.

Transparency moving forward

The USPTO has signaled its intention to promote transparency in the sanctions process for applicants, registrants and third parties who are interested in a particular application or registration. It will place documents — including orders to show cause and for sanctions regarding specific applications and registrations — in the USPTO’s public online Trademark Status and Document Retrieval database. The database also will show if an application’s examination is suspended because of a pending investigation or order.

Contact us for more information on the new sanctions process or any other trademark concerns.

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