On Monday as part of the Consolidated Appropriations Act for 2021 that included the COVID-19 relief package, Congress passed the Trademark Modernization Act, which President Trump is expected to sign.
With respect to trademark infringement litigation, the act restores the rebuttable presumption of irreparable harm to support injunctive relief on proof of trademark infringement. The United States Supreme Court decision in the patent infringement case of eBay, Inc. v. MercExchange had been applied in several circuits to eliminate the presumption of harm in trademark cases, requiring evidence of harm instead. The act resolves the split among the circuit courts and provides a valuable tool to trademark owners seeking to enjoin infringers.
The act also created expedited, ex parte procedures to deny registration to applications where the specimen is shown to be false and to cancel registrations of marks that can be shown never to have actually been used in commerce.
Specifically, as to pending applications, the act now permits third parties to submit evidence to the director of the United States Patent and Trademark Office with a concise description supporting denial of registration. The director may send the submission to the examining attorney to further investigate the specimen and deny registration if the specimen is shown to be false.
For marks that have already been registered, the act creates two new ex parte procedures to challenge the registration. The first is a third-party expungement procedure, pursuant to which “[a]ny person may file a petition to expunge a registration on the basis that the mark has never been used in commerce on or in connection with some or all of the goods or services recited in the registration.” The second is a process by which “[a]ny person may file a petition to reexamine a registration on the basis that the mark was not in use in commerce on or in connection with some or all of the goods or services recited in the registration on or before the relevant date.”
In both cases, the law also allows the director to initiate either an expungement proceeding or a reexamination proceeding if the director discovers information warranting that procedure.
An expungement proceeding may be initiated after the registration has been in effect for three years. A reexamination proceeding may be initiated not later than five years after registration.