Congress Passes the Trademark Modernization Act of 2020 as Part of Coronavirus Relief

Also dubbed the TM Act of 2020, Congress has made sweeping changes to trademark law and US Patent and Trademark Office (USPTO) procedure as part of the bipartisan coronavirus relief bill passed on December 21st.  The Trademark Modernization Act of 2020 could become law as soon as this week.

Amendments to the Lanham Act are intended to reduce the number of spurious trademark registrations and marks that remain on the register but are not in use in commerce.  Congress has provided for third-party submission of evidence relating to a trademark application to oppose the registration of the mark and has established expungement and ex parte proceedings relating to the validity of marks that are not in use in commerce.  The PTO may also initiate an expungement or reexamination proceeding for marks not in use in commerce.  Congress also has provided for a new ground for cancellation, namely, that a registered mark has never been used in commerce on or in connection with some or all of the goods or services cited in the registration at any time after the three-year period following the date of registration. Importantly, the new legislation expressly provides that Congress is not altering the standards for use in commerce. 

These changes provide for additional hurdles to registration and also can affect the longevity of trademark registrations.  We expect US registrations that are based on foreign registrations reciting many goods and services without the need to prove use in commerce during examination to be particularly vulnerable to cancellation.  Trademark owners should carefully review their recitation of goods and services to avoid these new proceedings. 

We also expect that third parties will submit evidence during examination to oppose registration in an attempt to avoid costly litigation in opposition and cancellation proceedings.  Having watch notices set up to reveal new applications filed in the USPTO will assist trademark owners in this type of enforcement.

In addition to USPTO changes, Congress has also addressed an important aspect of trademark litigation.  Plaintiffs who have prevailed in court in asserting trademark rights now have a presumption of irreparable harm for purposes of determining whether the plaintiff should be entitled to a permanent injunction. A trademark plaintiff seeking a preliminary injunction is entitled to this presumption upon a court finding that the plaintiff is likely to succeed on the merits of the case and no longer needs to establish irreparable harm to secure an injunction.

Finally, Congress has provided that the Government Accountability Office shall report to Congress on the USPTO efforts to address false and inaccurate claims in trademark registrations and applications. This provision may result in increased USPTO audits of registrations after a registrant files a declaration of use to maintain a registration.

Our trademark practitioners are here to help all clients navigate this new law, and protect and enforce their trademarks pursuant to these amendments.