Pitfalls in Trademark Prosecution

Guest Post by James Major.

In a post entitled “Trademark: Registration Void if Completed Prior to Actually Rendering Services in Commerce,” Prof. Crouch asserted that “[o]ne of the traditional benefits of trademark law is that it has fewer disastrous pitfalls for the uninformed (as compared with patent law).”[1]  This guest post respectfully disagrees with Prof. Crouch and asserts that trademark law contains administrative traps for the unwary not commonly found in patent law.

Of course, a patent prosecutor and a trademark attorney can each make substantive and procedural errors; creating an estoppel and blowing a deadline, respectively, are just two.  But, substantive and procedural errors are hardly unique to patent and trademark law.  This post argues that there is the possibility of what I will call “administrative” errors that are unique to trademark law. These administrative errors arise partly because of the ease of submitting documents to the United States Patent and Trademark Office (the “USPTO”) through the Trademark Electronic Application System (“TEAS”),[2] and partly because of the fundamentals of U.S. trademark law.

1)         The Risk of Inadvertent Factual Assertions

Imagine the following scenario: the client asks the trademark attorney to submit an application for U.S. trademark registration based on a bona fide intent to use the trademark in commerce.[3]  The trademark attorney completes the form on TEAS, signs where instructed, and submits the form.[4]  Simple as that, right?  In a way, yes.  But, there’s a problem here: in submitting the intent‑to‑use application, the trademark attorney has just asserted that he or she knows the client has a bona fide intent to use the trademark in commerce.  Does the trademark attorney have first‑hand knowledge of that?  Is there evidence of “circumstances showing the good faith” of the client?[5]  A deposition would resolve those issues nicely.  And, the opposing party in a dispute could move to disqualify the trademark attorney and his or her firm from representing the client to boot.  After all, the trademark attorney is now a fact witness.

The TEAS system has a neat way round this administrative problem: the trademark attorney can e‑mail the application to the client to sign electronically.[6]  And, the signatory will hopefully have the first‑hand knowledge necessary to make the assertion under “circumstances showing the good faith” of the client.

2)         Use of the U.S. Acceptable Identification of Goods and Services Manual Can Be Dangerous

Now imagine the trademark attorney is working on behalf of a client that performs trademark searches, and only trademark searches.  The client instructs the trademark attorney to prepare an application for U.S. service mark registration of the client’s service mark, XXXXX.  The U.S. Acceptable Identification of Goods and Services Manual helpfully gives the trademark attorney plenty of options as to what recitation of services to choose, including:

  1. “Legal services”;
  2. “Legal services, namely, trademark searching and clearance services”; and
  3. “Legal services, namely, intellectual property consulting services in the field of identification, strategy, analytics, and invention.”[7]

So, the trademark attorney chooses recitation (2), e‑mails the application to the client for signature, and ultimately submits the application.  After all, the USPTO has approved all of these recitations.  But, the USPTO states:

You must ensure that statements made in filings to the USPTO are accurate, as inaccuracies may result in the cancellation of a trademark registration.  The lack of a bona fide intention to use the mark with all goods and/or services included in an application, or the lack of use on all goods and/or services for which you claim use, could jeopardize the validity of the registration and result in its cancellation.[8]

Because the client is not using the XXXXX service mark in commerce in connection with “trademark clearance services,” the client has made an inaccurate statement that could be grounds for cancellation of any service mark registration.

This administrative error may come as a surprise to patent attorneys, who typically write as broader claims as possible.  But, in U.S. trademark registration practice, there is a danger in unwitting over‑breadth.

Neither point (1) nor point (2) is a criticism of TEAS overall, nor should either be deemed so.  In some ways, TEAS is a victim of its own success.  In making trademark filing and prosecution so straightforward, it is easy to forget that one is submitting a legal document.

3)         The Joys of Good Will

Patents have the attributes of personal property.[9]  So do trademarks, inasmuch as the owners can buy them, sell them, transfer them, securitize them, etc.[10]  So, the trademark attorney take a patent assignment form and simply replace the word “patent” with the word “trademark,” right?  Wrong again, because, by making an administrative error with the form, the trademark attorney has just separated the trademark from the good will.  Prof. McCarthy defines good will as “a business value that reflects the basic human propensity to continue doing business with a seller who has offered goods and services that the customer likes and has found adequate to fulfill his needs.”[11]  And, it’s the good will that gives the trademark value.  An assignment that transfers trademark ownership but leaves the good will behind is a naked assignment that effectively destroys the value of the trademark.[12]

The solution to this administrative problem is relatively straightforward: use a form that assigns the trademark and the associated goodwill.

4)         More Assignment Antics

Now, the trademark attorney has the correct form, and assigns the intent‑to‑use application to a third party.  But, again, there’s a problem: in most cases, the statute forbids the assignment of intent-to-use applications.[13]

Given its statutory origin, there is no easy way to circumvent this administrative problem.  But, this problem is certainly an issue in trademark due diligence.

This post describes some of the administrative traps for the unwary trademark attorney.  There are probably others, only I haven’t found them (or worse, fallen into them).  But, to say that “[o]ne of the traditional benefits of trademark law is that it has fewer disastrous pitfalls for the uninformed (as compared with patent law),” hasn’t been my experience, at least on the administrative level.

= = = = = =

[1]               Dennis Crouch, Trademark: Registration Void if Completed Prior to Actually Rendering Services in Commerce, Patently-O (Mar. 2, 2015), https://patentlyo.com/patent/2015/03/trademark-registration-rendering.html.

[2]               U.S. Patent & Trademark Office, http://www.uspto.gov/trademarks-application-process/filing-online (last visited Mar. 9, 2015).

[3]               See 15 U.S.C. § 1051(b) (2012).

[4]               See generally Trademark/Service Mark Application, Principal Register, U.S. Patent & Trademark Office, 1‑21, http://www.uspto.gov/sites/default/files/documents/new_teas.pdf (last visited Mar. 9, 2015) [hereinafter TEAS Regular Form] (providing a preview of a “TEAS Regular” form).

[5]               15 U.S.C. § 1051(b).

[6]               TEAS Regular Form, supra note 4, at 18‑19.

[7]               U.S. Patent & Trademark Office, U.S. Acceptable Identification of Goods and Services Manual (ID Manual), http://tess2.uspto.gov/netahtml/tidm.html (enter “legal services”) (last visited Mar. 9, 2015).

[8]               TEAS Regular Form, supra note 4, at 15 (underlining added).

[9]               35 U.S.C. § 261.

[10]             See 1 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 2:14 (4th ed. 2014).

[11]             Id. § 2:17.

[12]             Id. § 2:15 (“Trademarks, unlike patents and copyrights, have no existence independent of the good will of the products or services in connection with which the mark is used.”).

[13]             15 U.S.C. § 1060(a)(1).

16 thoughts on “Pitfalls in Trademark Prosecution

  1. 8

    I like the comment…… Many cases. “Naked asssignment” or “assignment in gross” are the terms of art used in the case law. McCarthy cites many cases.

  2. 7

    Nice ……As an old time paper practitioner, the new e-filing systems can really put the attorney in hot water. The problems listed in item 1, when the attorney affirms, makes the attorney a material witness in an embarrassing situation revealed, as noted by deposition.

  3. 4

    As to whether a client has a bona fide intent to use a trademark in a 1(b) application, I ran into an interesting situation a few years back.

    I had a client who wanted to submit 15 ITU applications for new trademarks for a product the client was already shipping under other (very different) names. The client did intend to use one or two of the marks if any were allowed. If all 15 were allowed, the client would have likely picked 2 or three the client liked best and abandoned the remainder. However, there was certainly no intent to use ALL allowable TMs.

    I wasn’t completely comfortable with this strategy, though I didn’t turn up any case law that indicated such a tactic could backfire..

    My client was essentially using the USPTO as a TM search service, which tactically, has some value. My gut feeling is, however, is that it borders on unethical and potentially risky.

    1. 4.1

      Two thoughts strike me:

      1) are you jumping the gun by assuming any marks are in fact “allowable” prior to the marks actually allowed (including any pertinent opposition periods)…?

      2) are you assuming a total absence of objective evidence of intent to use at least one or more of the family of marks?

      I think if you have that objective evidence of intent – even perhaps merely at the “one of this family” level, then you have evidence that distinguishes the several cases in which opposition was successful for a lack of any objective evidence.

      That being said, I am not aware of any case directly on point to such a “family of marks” proceeding. I do think that the tendency towards some sort of “fraud” in lacking extant objective evidence tends to fly in the face of the ability to develop such evidence while filing up to 36 months worth of delays (Judith Grubner wrote a Law360 article on the subject about a year ago iirc).

  4. 3

    As an old time paper practitioner, the new e-filing systems can really put the attorney in hot water. The problems listed in item 1, when the attorney affirms, makes the attorney a material witness in an embarrassing situation revealed, as noted by deposition.

    The government in its quest for expediency has made the attorney the “fall guy.”

    1. 3.1

      I wonder how big a problem that is. It is certainly best if you make the client sign those declarations for the SOU, but does it really matter?
      If I were to sign a declaration to support intent to use, and later be deposed, and asked what evidence of bona fide intent to use, wouldn’t it be sufficient to say “cause they paid me to file an ITU application”? If asked how I knew the specimen had been used, wouldn’t it be sufficient to say “they sent me a sample and an invoice”? or “I bought one at the store”? Even if that waived some privilege, the entire communication might consist of a manila envelop that the sample and invoice came in.
      Also, who, after proving actual use, will be questioned about a lack of bona fide intent to actually use a mark? Is it likely that a client will file in bad faith and then actually end up using the mark? And what other “circumstances showing the good faith” might there be, beyond having enough interest to pay for an application? Maybe if a client asked you to file an application for APPLE for use in connection with computers this is not bona fide intent, but if you file that even with a declaration by the client you could be sanctioned on other grounds, and the application would be unsuccessful. In a few known cases (link to tmfive.org) the bad faith is so evident that an attorney filing the application should know it is bogus, and being careful to have the declaration signed by the client would not absolve the attorney. In the typical case, I don’t think it matters much.

      1. 3.1.1

        The easy answer is “Yes, it does matter.”

        Being sloppy in this regard (even if you were to spot that “most times” it may have little effect) is an invitation for Murphy to come by and smack you with his law.

        The better avenue (always) is to understand what you are doing and NOT to “dabble” where you don’t understand.


          I would be interested in anecdotes or scenarios illustrating this. Just exploring: I don’t advocate signing declarations for SOU/Renewal/Actual use because there is that bogeyman out there. But is the bogeyman real?
          Harper at comment 4 provides a scenario in which the “intent to use” might not be bona fide. If an attorney signed declarations for 15 ITU applications that, given the circumstances, are not filed with bona fide intent, that is bad. If, on the other hand, an attorney prepares and submits 15 declarations signed by the client, which are equally bogus, that it also bad. A difference is that the attorney might be disciplined under different theories (perjury versus suborning perjury?). Another difference is that attorney-client privilege might be waived under different theories (direct waiver versus crime-fraud exception?). In either case a resultant registration might be invalid.


            I answered Mr. Harper above. It appears that you too are perhaps too quick to find malfeasance where none may exist.

  5. 2

    Has there ever been a case where assignment of a trademark without corresponding assignment of good will was found to have a material impact?

  6. 1

    Nice post, James. All this is why I send clients elsewhere when they ask for help with trademarks. It can be dangerous to dabble.

    1. 1.1

      Dan has nailed it, dabbling is both rampant and dangerous. All of the traps that James mentions are real, but they are so basic that if you don’t understand them you shouldn’t be holding yourself out as qualified to represent clients for pay in this area.

      1. 1.1.1

        Thanks Brad and DanH,

        On point and exactly true for ANY area of law.

        Personally, I enjoy the trademark area just as much as the patent and copyright areas (even if the genesis stems from a different section of the constitution).

        That being said, it would be nice if more development of trademark law occurred on this blog. We could start with this blog post, or perhaps pursue this: link to patentlyo.com

      2. 1.1.2

        Many cases. “Naked asssignment” or “assignment in gross” are the terms of art used in the case law. McCarthy cites many cases.

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