Trademark in the USA: Meaning and Provisions

This article titled ‘Trademark in the USA: Meaning and Provisions’ by Adv. Nikita Pandit and discusses trademarks in the USA.

I. Introduction

Trademark can be any sign, symbol, design, word, name – individually or in a combination of one or more, which helps in identifying the goods and services belonging to a person or an entity. It is an identity of a product or a service. Usually, the mark which is used to represent the goods is called trademark and when used for services it is called a service mark.

Trademark:

1. Right to the owner of the trademark to use such element in association with the product or service that he is providing.
2. No exclusive right over that word, phrase or sign.
3. Others can also use such words, symbols or marks.
4. Condition – different and not associated with the one that is similar to that former one.

In the USA, the owner of the trademark gets the right over his mark the moment he starts using it in association with his business. Use of the mark is considered as a pre-requisite to get the rights.

Rights on the basis of the USE – protection limited to the territory in which such goods and services are provided.

Registration of the trademark – more protection under the law than the unprotected trademarks. This protects the trademark in the entire USA and is not restricted to small territories.

These unregistered trademarks are allowed to use the TM or SM sign along with their mark to let the purchasers and the competitors know that they are using the mark for their product or services. When it is registered they can use the R mark.

II. Constitutional Provisions

Unlike the copyright and patent, Congress does not get the power by the virtue of Article 1 Section 8 Clause 8. It has its roots in the Commerce Clause of the constitution of the USA in its Article 1 Section 8 Clause 3 where the congress has the power to do the acts to regulate the commerce with the foreign countries, among states and with the Indian tribes.

III. Legislative Provisions

The Trademark Act, 1870 was the first trademark law in the USA. Further several amendments were made to this and in a Trademark Case in 1879, all such amendments along with the legislation were held unconstitutional.

The main federal law for trademarks in the USA is the Laham (Trademark Act), 1946 which provided for a legislative framework of the rights and liabilities associated with the trademark. This is a part of Title 15 of the US Code. Along with this the Trademark Counterfeiting Act, 1984 was passed making it a crime to deal with counterfeit goods. Eg: Imitation and duplicate goods.

IV. Registration

The person who wants to register the trademark has to approach the US Trademark and Patent Office and make an application with appropriate fees and also provide the mark to be used. The domicile and the date of the first use of the trademark must be given with the application.

Such trademark should be such that it should be able to be distinguished from the products or services of another person. Once the application is filed the examination attorney sees if the application meets the legal requirements. If it complies with the provisions, the publication of the trademark is approved.

If it does not comply with the provisions, the attorney gives notice to the applicant mentioning why the application was rejected and makes suggestions if any changes are required in the application for approval. If within the given time period the changes are made, the application may be approved. If no changes are made or if the changes are not adequate the final notice is given of rejection.

An appeal can be made against this final decision with the Trademark Trial and appellate board. If no reply is filed, the trademark is considered to be abandoned by the applicant. The Director publishes the prospective mark in the Gazette so that any person can oppose or apply for the concurrent use if he is also using a similar trademark.

The law provides that the trademark should not be denied by the authority if it is distinguishable from the other marks. The service marks can also be registered which represent a service provided by a person or an entity. The registration certificate proves in the court that whose name appears on the certificate is the owner of the trademark. USTPO maintains a register of trademark and the date of registration is recorded.

V. How a mark should be?

The mark cannot be scandalous, immoral or deceptive in nature which might confuse the consumers. It should not make any false statements about living or dead persons. It should not make any suggestions as to a belief or institute. It should not be a geographical indication or a trademark that is already registered by another person or entity for their product or services. The mark or name should not be generic.

In the United States Patient and Trademark Office et al. v. Booking.com B. V., the Supreme Court. The USPTO had rejected a trademark and held that a generic name cannot be eligible for a trademark. In this case, it was “booking.com” and their contention was that such a term is easily used in the case of hotels and tour bookings.

However, when the judicial review was taken, the district court and further the court of appeals rejected this view. This was because the two terms booking and .com were combined to form a mark. In such a case, the only test that can be taken is what do consumers view such marks as and whether they can distinguish the same from others.

The registration of a trademark is for a period of 10 years. The non-submission of the required affidavits in the given time may lead to the cancellation of the registration. After 10 years it can be renewed for another 10 years and this can be done after every 10 years by paying appropriate fees. In order to renew the registration, the application should be made 1 year in advance before the period of 10 years expires.

VI. Transferable Right

Trademark Rights can be transferred – Assignment.

It is a right that belongs to the trademark owner which is given to some other person along with the reputation that the mark carries that is goodwill. Such assignment must necessarily be in writing and signed by the parties and the same must be intimated to the US Patent and Trademark Office. If it is not recorded by the office, it is not a valid assignment.

VII. Cancellation

Section 1064 provides for the cancellation of the registration. So if any person feels that the trademark which is registered has the capacity to damage his reputation or cause any harm to his title due to such registration, he can file a petition for cancellation of the registration of such marks by mentioning the grounds of such petition. They should show how it will harm their reputation by giving such evidence. This has to be done within 5 years of registration.

VIII. Infringement

Section 1114 of the Code provides that if any person uses, or makes copies or uses imitation or duplicate goods having such trademark of the owner or sells, distributes or offers for sale any such goods using the trademark of the owner without taking his permission it amounts to infringement and civil action can be taken against such a person.

This also includes using the mark of the plaintiff on some products or packages or labels. The word person also includes the association of persons like corporate, firms, the state and the state bodies are also included within this term. So if the US government also infringes the trademark, the action can be taken, provided it is within the scope of legal provisions.

It should be proved in case of imitation that it was purposely done with the knowledge that it is against the law and to confuse or deceive the public with respect to the trademark.

Counterfeiting of goods is also held as a crime and the fine for an individual may go up to 20 Lakh Dollars and other than individual 50 Lakh Dollars or imprisonment up to 10 years or both. In case of repeating or continuous offence, the fine for an individual rises to 50 Lakh Dollars and for others 1 crore 50 Lakh Dollars or imprisonment up to 20 years or both.

Unauthorized use of trademark – 1-800Contacts v. WhenU.com

The appellant was WhenU which was an internet company that provided pop up ads on the computer. The Respondents 1800 Contacts were the sellers of the contact lenses by internet and telephones. It was their trademark in the phrase We deliver you save and got a service mark in 1-800Contacts and the logo.

They contended that WhenU created popups of the competitors to be seen on the pc when consumers opened 1-800Contacts’ website. Court held that such creation of pop up is not per se use of the trademark of Respondents. The use should be commercial use.

IX. Reliefs and remedies

1. Injunction

Under Section 1116, the relief that is given under the law against infringement is an Injunction to put a stay on the acts amounting to the infringement. After such a decision, within 30 days the infringer has to give in writing to the court and to the plaintiff that he shall follow the order of the court and prevent himself from doing any such actions mentioned in the decision of the court.

The district courts have jurisdiction over such matters. The courts also have to inform the Director about the litigation details within one month once the proceedings start. In the counterfeit claim or when such goods are sold, distributed or offered for a sale, the court can also direct to confiscate such goods and all the required documents in association with such duplication and this can be done ex parte.

2. Profits

Section 1117 provides for the remedy of claiming the profits that the defendant may have made by infringing the trademark.

3. Damages

He can ask for compensation for the loss suffered by him and also the money that he spent for the sake of the action in court. The court has the power to award as much as 3 times the actual damage caused to the trademark owner.

4. Legal Fees

Fees spent on the appointment of an attorney can also be claimed in certain circumstances depending upon the court’s decision.

5. Seizure and destruction

The court has the power to direct the infringer to destroy all the infringing articles like packages, labels, wrappers or any other advertisements. The attorney can hear such a case of destruction and evaluate the evidence on 10 days notice given by the trademark owner.

In D2 Holdings v. MRC 11 distribution Co.

A show named House of Cards was broadcast on Netflix. D2 had contended that they had a game show on radio with the same name way before the show aired. It was also contended that MRC 11 had failed to get the trademark and without permission started selling merchandise in that name. The matter is still pending in court. The claim is actual damages and punitive damages.

6. Appeal

An appeal can be made against the decision of the District Court in respect of infringement to the US court of appeal which is a federal circuit court under Section 1121.

X. International treatment

Under Section 1126, the USPTO has to keep a record of all the trademarks registered internationally. It includes all the details including name, address, country and date. It ensures protection in all nations that are party to the convention where the US has signed the convention. The date of application applied from any country under convention remains the priority date which helps to prove the use of the trademark.

These are the peculiar provisions followed in the USA in case of dealing with the trademarks.

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References

1. Constitution of the United States, Available Here.
2. Trademark Act 1946, Available Here.
3. OLRC, Available Here.
4. UNITED STATES PATENT AND TRADEMARK OFFICE ET AL. v. BOOKING.COM B. V., Available Here.
5. 1-800 CONTACTS, INC., Plaintiff-Appellee, v. WHENU.COM, INC. and VISION DIRECT, INC., Defendants-Appellants, Available Here.
6. ‘House of Cards’ Distributor Sued for Trademark Infringement, Available Here.

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