Weekly IP Takeaways

Prepared by Cislo & Thomas LLP Attorney Mark D. Nielsen, Ph.D.

Embellishing on a recent post, the COVID relief package at the end of 2020 contained interesting IP-related provisions, including the Trademark Modernization Act and the Copyright Alternative Small-Claims Enforcement Act. These are the standalone versions of the bills, which are the same or nearly the same as the versions included in the COVID relief package.

The Trademark Modernization Act is largely intended to address false claims of trademark use in commerce in the U.S., bogus specimens of use, and a dwindling of available trademarks because of illegitimate trademark registrations. Another significant element of the Act is the restoration of the presumption of irreparable harm upon a finding of infringement for purposes of securing injunctive relief, a proposition that was not always easy since the Supreme Court’s decision in eBay v. MercExchange.

The Trademark Modernization Act creates a right of protest for third parties in which they can submit evidence of a likelihood of confusion for consideration by the Examining Attorney while a trademark application is pending (but before an application is published for opposition). The Act also created an expungement proceeding where an existing trademark registration can be challenged because it was never used in commerce in the U.S. The Act further created a reexamination proceeding where the concern is not non-use, but non-use prior to the registration date, which would normally not be possible in the U.S. (use is required to secure a registration). Finally, the Act added non-use as a basis for cancelling a registration. There are limitations and caveats to each of these procedures, but these are certainly new and interesting means of defending and enforcing one’s trademark rights.

Regarding the Copyright Alternative Small-Claims Enforcement Act, the idea with the bill is to create a forum for resolution of small copyright disputes. The Act creates a three-person tribunal (or Board) within the Copyright Office to handle disputes brought before it. The value of the disputes must be no more than $30,000. Attorneys’ fees would generally be unavailable. Discovery would be limited to written discovery, but no depositions, and expert witnesses would not be permitted except in exceptional situations. If you are on the receiving end of one of these proceedings, you can opt out within 60 days of service. If you are on the losing end of one of these proceedings, appeal rights are very limited to issues such as fraud and corruption. Thus, in garden-variety, small copyright matters, the decision of the Board will essentially be final. At this point, it is entirely unclear what standard the Board will apply for infringement or challenges to a registration, for example. Finally, one very interesting issue that arises from the ability of an executive branch tribunal to award damages is whether that is a usurpation of the province of Article III courts such that it raises a constitutional issue. For small copyright disputes, however, this may be a viable option for enforcement.