Trade Marks & Copyright 2024 Comparisons

Trade Marks

Trade mark rights in the USA are governed by both statutory and common law.

Although registration of a trade mark with the United States Patent and Trade Mark Office (USPTO) provides substantial rights to trade mark owners (see 4.1 Trade Mark Registration), it is not required to establish common law rights in a mark or to commence use of a mark. Under the common law, rights are acquired through actual use of a mark on or in connection with goods and/or services. However, common law trade mark rights are geographically limited to the area in which the mark is used.

Statutorily, trade marks are primarily governed by the Lanham Act, enacted in 1946 and as amended (15 USC Sections 1051 et seq). Additionally, Title 37 of the Code of Federal Regulations provides applicable regulations.

Trade mark rights vary state by state. Generally, states govern trade marks similarly through both statutory and common law.

Copyrights

Copyrights are governed by the Copyright Act 1976 (17 USC Sections 101 et seq). Title 37 of the Code of Federal Regulations also provides applicable regulations.

The Copyright Office provides the Compendium of US Copyright Office Practices. This is a governing administrative manual for registration and recordations issued by the Copyright Office.

Trade Marks

The USA is party to the following treaties concerning trade marks:

• the Trademark Law Treaty;
• the Singapore Treaty on the Law of Trademark;
• the Madrid Agreement Concerning the International Registration of Marks (the “Madrid Protocol”);
• the 1967 Paris Convention for the Protection of Industrial Property;
• the Trade-Related Aspects of Intellectual Property Rights (the “TRIPS Agreement”), as part of the Agreement Establishing the World Trade Organization; and
• General Inter-American Convention for Trade Mark and Commercial Protection of Washington 1929 (the “Pan-American Convention”).

Copyrights

The USA is party to the following treaties concerning copyrights:

• the Berne Convention for the Protection of Literary and Artistic Works (the “Berne Convention”);
• the World Intellectual Property Organization (WIPO) Copyright Treaty;
• the WIPO Performance and Phonograms Treaty; 
• the TRIPS Agreement, as part of the Agreement Establishing the World Trade Organization;
• the UCC Geneva Convention for the Protection of Producers and Phonograms Against Unauthorized Duplication of Their Phonograms;
• the Brussels Convention Relating to the Distribution of Programme-Carrying Signals Transmitted by Satellite; and
• the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired, or Otherwise Print Disabled.

Trade Marks

Owners of well-known or famous foreign trade marks have rights under the Lanham Act to enforce against the unauthorised use of the trade mark in the USA, even if the owner has not used the mark or registered the mark in the US (see 2.1 Types of Trade Marks (Famous Marks Doctrine)).

Copyrights

Under the Berne Convention, foreign copyright holders are permitted to bring infringement claims in the USA even without a US copyright registration. However, certain remedies remain dependent on the work being registered, including statutory damages and attorney’s fees.

Section 104 of the Copyright Act concerns the national origin of works receiving copyright protection.

Types of Trade Marks Recognised

Trade marks identify the source of goods, whereas a service mark identifies the provider of a service. However, it is common for the term “trade mark” to be used to describe both types of marks. In addition to trade marks and service marks, the USA recognises collective marks, certification marks, and trade dress.

Collective marks

A collective mark is owned by a collective organisation and used only by the members of the collective. A collective organisation may include an association, union, co-operative, fraternal society or other organised group.

The two types of collective marks are:

• collective trade marks or collective service marks; and
• collective membership marks.

Collective trade marks or collective service marks are trade marks adopted by a collective for use only by its members to identify their goods or services to distinguish themselves from non-members. However, the collective itself does not offer any goods or services in connection with the trade mark, but may use the trade mark to advertise or promote its members.

A collective membership mark is a trade mark adopted for the sole purpose of indicating membership in a collective. Neither the collective nor its members uses the trade mark in connection with the offering of any goods or services.

Certification marks

A certification mark is a trade mark used to show consumers that particular goods and/or services, or their providers, have met certain standards or originate from a particular geographic region. The owner of the certification mark controls who can use the trade mark if the goods, services, or provider meet the required standards.

Trade dress

Trade dress refers to the look and feel of a product or service that distinguishes the source of that product or service from others. Examples of trade dress may include the product packaging, labels on the package or product, the design of a product, flavour or colour of a product, layout of a restaurant, or the design of a retail store.

To be registrable, trade dress must be distinctive and non-functional. Trade dress is also protected by common law rights.

Types of Source Identifiers

Trade marks indicate the source of goods and/or services. Accordingly, trade marks may consist of words, slogans, names, designs, symbols or any combination. Less commonly, trade marks may also consist of a sound, scent or colour.

Trade marks may be registered either in standard character form or special form. Standard character form is commonly referred to as a “word mark” and provides the broadest scope of protection because it protects the words themselves, not limited to a particular font style, size, or colour. Conversely, a special form includes stylised lettering or a design that is a significant portion of what is protected. Special forms may also include trade dress.

Special Marks

Special marks may be protected and regulated by statute – for example, the use of Olympic symbols, emblems, trade marks and names is regulated. Per 36 USC Section 380, such regulation applies to the use of:

• the Olympic symbol consisting of five interlocking rings;
• the Olympic emblem;
• any trade mark, trade name, sign, symbol or insignia falsely representing association with the Olympic Committee; or
• the words “Olympic”, “Olympiad”, “Citius Altius Fortius”, or any combination tending to cause confusion or falsely suggesting a connection with the Olympic Committee or any Olympic activity.

Famous Marks Doctrine

Under Section 43(a) of the Lanham Act, owners of well-known foreign trade marks may bring claims against the unauthorised use of the trade mark in the USA, even if the owner has not used the mark or registered the mark in the USA. Such claims may include opposing a trade mark application, seeking cancellation of a registration, or bringing a lawsuit.

If the trade mark is famous in the USA, the foreign mark owner could also assert claims for trade mark dilution under Section 43(c) of the Lanham Act. Famous trade marks are those that invoke an immediate connection in the minds of consumers with a specific good or service and the source of that good or service.

There are four primary requirements for trade mark registration. The trade mark must:

• not be confusingly similar to other trade marks;
• be distinctive;
• be in use in US commerce; and
• be a source identifier.

No Conflicts

The USPTO will reject a trade mark application if the proposed mark is close enough to an existing US application or registration to the extent that there is a likelihood of confusion. A finding regarding the likelihood of confusion is determined by considering a number of factors, including the similarity between the marks and relatedness of the goods and/or services.

Distinctiveness

Distinctiveness refers to how well a mark identifies the source of a good and/or service. The more distinctive a trade mark is, the stronger. A distinctive trade mark may be either inherently distinctive (fanciful, arbitrary or suggestive) or have acquired distinctiveness through use.

The USPTO employs a spectrum when determining the distinctiveness of a trade mark, as follows.

• Fanciful trade marks ‒  the strongest and most distinctive marks, consisting of invented words.
• Arbitrary trade marks – strong and distinctive marks consisting of words with dictionary meanings but that have no association with the claimed goods and/or services.
• Suggestive trade marks – distinctive and thus protectable marks consisting of words that have a dictionary meaning and require a mental step between the meaning of the words and the claimed goods and/or services.
• Descriptive trade marks – immediately convey an ingredient, quality, or characteristic of the claimed goods and/or services. Descriptive marks are weak and registrable only if the applicant can show the mark has acquired secondary meaning.
• Generic trade marks – describe the goods and/or services the mark is used in connection with and cannot be registered.

Acquired distinctiveness (or “secondary meaning”) occurs when a descriptive term acquires unique significance over time through actual use in connection with goods and/or services to the extent that consumers associate the trade mark with a particular source. Proof of ownership of a prior registration for the same mark or five years of substantially exclusive and continuous use of the trade mark in commerce may also prove acquired distinctiveness.

If acquired distinctiveness is proven, a descriptive mark can be registered pursuant to 15 USC Section 1052(f).

Use In Commerce

See 2.4 Use in Commerce.

Source Identifier

The trade mark must be capable of identifying the source of a good and/or service. Generally, this means the trade mark is not generic, deceptive, ornamental, or otherwise prohibited by law.

Common law trade mark rights continue indefinitely, so long as the trade mark remains in use in connection with the goods and/or services.

Federal trade mark registrations may also continue indefinitely, provided the trade mark remains in use in connection with the claimed goods and/or services. Trade mark owners must renew registrations by filing maintenance documents with the USPTO every ten years (and a declaration of continued use between the fifth and sixth anniversary of the registration date). Such renewals require submission of a declaration and evidence that the trade mark is in use in commerce with the claimed goods and/or services. The renewal may be filed as early as one year before the expiration date or as late as six months after the expiration date, with payment of an additional fee. If the registration is not timely renewed, it will expire and cannot be revived.

A trade mark must be used in connection with the claimed goods and/or services in order to be registrable. Such use must be “in commerce” – meaning that it crosses state, national or territorial lines, or affects interstate commerce (eg, sales online), or caters to interstate or international customers.

Registered trade marks may be denoted by using the ® symbol (or by “Registered in the U.S. Patent and Trademark Office,” “Registered in U.S. Patent Office,” “Reg. U.S. Pat. & Tm. Off.” or “Reg. U.S. Pat. Off.”). Although not required, use of the ® symbol entitles the trade mark owner to an award of damages of the infringer’s profits without having to prove the infringer’s actual notice of the registration. The ® symbol may not be used with unregistered marks.

The owner of an unregistered trade mark can use the ™ symbol. The ™ symbol does not have legal meaning but provides notice that the trade mark owner claims rights to the trade mark. The ℠ symbol may be used in connection with service marks. However, it is common for the ™ symbol to be used for both types of marks.

Copyrights and trade marks are different types of IP covering different rights. A trade mark identifies the source of goods and/or services, while copyrights protect original, creative works fixed in a tangible medium. Generally, IP that can be trade marked cannot be copyrighted, and vice versa. There are a few exceptions that can be protected by both a trade mark and copyright – for example, logos or jingles.

Types of Works Protected by Copyrights

Copyrights protect “original works of authorship” that are “fixed in any tangible medium of expression.” The following types of works may receive copyright protection:

• literary works (eg, novels, poems, articles, essays, advertising, catalogues, computer programs);
• musical works (eg, musical notation and accompanying words);
• dramatic works (eg, plays, operas, scripts, screenplays, accompanying music);
• pantomimes and choreographic works (eg, dance steps, physical acting);
• pictorial, graphic, and sculptural works (eg, visual art such as sketches, drawings, cartoons, paintings, photographs, maps, sculptures, jewelry and tapestries);
• motion pictures and other audiovisual works (eg, movies, videos, film strips);
• sound recordings (eg, recorded music, voice, and sound effects); and
• architectural works (eg, buildings).

Copyright does not protect facts, ideas, systems, or methods of operation (but may protect the way these things are expressed).

Software

Software is protected as a literary work. Each version of a published software program that contains new, copyrightable authorship, requires a new copyright application. Subsequent copyright registrations do not cover previously published or registered source code, source code in the public domain, or copyrightable source code owned by a third party. The Copyright Office permits registration of hypertext markup language (HTML) as a literary work, provided it is created by a human rather than a website design program and contains sufficient creative expression.

Databases

Copyright law does not protect databases as a category of creative works. However, a database comprising a collection and arrangement of material may be registrable as a compilation of copyrightable work or alternate work.

Industrial designs

Industrial designs do not receive copyright protection. However, they may qualify for a design patent under 35 USC Section 171, which protects the ornamental design of an article of manufacture.

Collective Works

Collective works contain multiple contributions, consisting of separate and independent works, assembled into a collective whole (eg, newspapers, magazines, anthologies, encyclopedias). The authorship of a collective work is established from the original selection and arrangement of the independent works to create the collective whole. For the purposes of copyright registration, a collective work is considered one work. Copyright registrations cover the collective work and may cover the individual works if the individual work is owned by the same party as the collective, has not been previously published or registered, and is not in the public domain.

Compilations

Compilations are works composed of a collection of pre-existing materials selected and arranged in a way that results in an original work of authorship. A copyright over a compilation does not include the individual works within it. Copyright protection is limited to the creative or original aspects of the compilation, meaning the selection and arrangement of the materials within the compilation.

For a work to be protected by copyright, it must be:

• a work of authorship;
• an original; and
• fixed in a tangible medium of expression.

Work Of Authorship

Work of authorship refers to both published and unpublished works (see 3.1 Types of Copyrightable Works).

An Original

Originality requires some creativity, meaning the work may not be a copy of an earlier work. However, a work based on or inspired by an earlier work may be copyrightable if there is some creativity involved that makes it different.

Fixed in a Tangible Medium of Expression

The work must be captured and perceived, reproduced, or communicated for more than a short period of time.

Authorship

Under the Copyright Act, an author is the creator of the original expression in a work. An author may be a person or an institution. Generally, the author of a work is also the owner of the copyright, unless the work is made for hire (eg, prepared by an employee within the scope of employment) or a commissioned work.

Authors may claim copyright protections anonymously or under a pseudonym.

Joint Authorship

Joint authorship is created when two or more creators of a work have the intent, at the time of creation, that their contributions be merged into inseparable or interdependent parts of a unitary whole. A unitary work is “inseparable” if it contains a single form of authorship (eg, novel or painting) and is “interdependent” if it contains multiple forms of authorship (eg, motion picture or music and song lyrics).

Joint authors jointly own the copyright in each other’s contributions and an undivided interest in the copyright for the work as a whole. Accordingly, joint authors have independent rights to use or license a joint work. However, joint authors must account for the profits of their use or licence and may not grant exclusive rights or transfer all interest in the work without consent from the other joint author(s).

Authorship Issues Raised by AI

The question of whether a work created by or with the assistance of AI is copyrightable is part of an evolving landscape. In March 2023, the Copyright Office announced its first formal guidance on this issue stating that works created with the assistance of AI may be copyrightable if the work involves sufficient human authorship. However, the parts of the work created by AI must be identified and disclaimed.

Economic Rights

Generally, a copyright grants the owner the sole right to produce, reproduce, perform, and publish the work. Economic rights persist throughout the term of the copyright.

Copyright registrations grant the following economic rights to owners:

• the right to reproduce the work in copies or phonorecords;
• the right to prepare derivative works based upon the work;
• the right to distribute copies or phonorecords of the work by sale or other transfer of ownership, or by rental, lease or lending;
• for literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, the right to perform the work publicly;
• for literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, the right to display the work publicly; and
• for sound recordings, the right to perform the work publicly by means of a digital audio transmission.

Moral Rights

The creators of select visual art works retain moral rights in the work, even if the copyright (ie, control over publication and reproduction) is transferred to someone else, unless waived by written agreement. Such works included are paintings, drawings, prints, sculptures and photographs.

Moral rights include:

• attribution – allowing the author to be credited as the author of the work; and
• integrity – preventing the distortion, mutilation, or other modifications that would prejudice the creator’s reputation.

Moral rights persist only throughout the author’s lifetime or, in the case of works of joint authorship, throughout the life of the last surviving author.

Synchronisation Rights

A music synchronisation (also known as “sync”) licence refers to a licence that allows the licensee to synchronise the music with a visual media output (such as movies, movie trailers, television shows, video games, advertisements, etc). Sync licences are granted by the copyright owner of a musical composition.

Transfer of Rights

Copyrights may be transferred. Transfers of exclusive rights must be in writing and signed by the copyright owner or the owner’s representative. See also 7.5 Transferred Rights and Termination.

Alienable Rights

Copyrights are freely alienable. For a transfer of rights to be valid, it must be in writing and signed by the copyright owner or the owner’s representative. Transfers are made by an assignment, mortgage, exclusive licence, or other conveyance. A certificate of acknowledgement, although not required, is prima facie evidence of a valid transfer. If executed in the USA, the certificate must be executed by a person who administers oaths within the USA. If executed internationally, the certificate must be issued by a diplomatic or consular office of the USA or by a person authorised to administer oaths.

Transmissible Rights

Economic rights are transmissible upon death either by will or under the law, in whole or in part. Moral rights are not transmissible as they cease at the death of the author.

Term of Protection

For works created on or after 1 January 1978, copyrights persist for the life of the author plus 70 years. Works are automatically protected by copyrights from the date the work is created and fixed in a tangible medium of expression.

For works created and published prior to 1978, the copyright term was originally for 28 years plus a 28-year renewal term. The 1976 Copyright Act extended the renewal term to 47 years and the 1998 Copyright Term Extension Act further increased the renewal term by another 20 years, for a total of 67 years. Accordingly, the max term of protection for a copyright established prior to 1978 is 95 years (a first term of 28 years plus a renewal term of 67 years).

Joint Works

For a joint work, the copyright expires 70 years after the death of the last surviving author. If the joint work was created by two or more authors as a work made for hire, an anonymous work, or under a pseudonym, the copyright term expires 95 years from the year of publication or 120 years from the year of creation (whichever is shorter).

Anonymous or Pseudonymous Works

For copyrights claimed anonymously or under a pseudonym, the copyright expires 95 years from the last year of publication or 120 years from the year of creation (whichever is shorter). However, if the author reveals their identity, the term converts to the life of the author plus 70 years.

Proper copyright notice consists of:

• the © symbol or the word “Copyright” or abbreviation “Copr.”;
• the year of first publication of the work; and
• the name of the copyright owner.

Copyright notice was required for all “visually perceptible” copies of works first published before 1 March 1989, subject to some exceptions. Visually perceptible copies include books, photographs, films, or sheet music.

Copyright notice is optional for works published on or after 1 March 1989, unpublished works, and foreign works. Even if optional, legal benefits for using a copyright notice include:

• notice of claimed copyright;
• for copyright infringement claims involving a published work, notice may prevent the infringer from raising an innocent infringement defence;
• identifies the copyright owner at the time the work was first published for parties seeking permission to use the work;
• notice identifies the year of first publication, which may be used to determine the copyright term (for anonymous works, pseudonymous works, or a work made for hire); and
• notice may prevent a work from becoming an orphan work by identifying the owner and specifying the copyright term.

Use of copyright notice does not require permission from the Copyright Office or a registration.

Collective rights management (CRM) refers to organisations that act on behalf of copyright owners to manage the licensing of copyrights and related rights to users. A CRM may also monitor the use of the copyright, collect licensing fees, and distribute royalties. Such CRM organisations typically handle licensing of copyrights within a particular industry (eg, works in print, musical works, dramatic works, software, religious works, etc). Participation in a CRM organisation is voluntary and most CRM organisations charge a fee for their services.

Although registering a copyright with the Copyright Office is not mandatory, it is a prerequisite for filing a claim in federal courts to enforce a copyright and to seek remedies under the Copyright Act (see 8.6 Prerequisites and Restrictions to Filing a Lawsuit (Copyright Infringement – Prerequisites and Restrictions)).

Searches for copyright registrations can be conducted in person at the Records Room of the Copyright Office or by a request made to the Office to conduct a search (fee: USD200 per hour, with a two-hour minimum). The print Catalog of Copyright Entries (“the Catalog”) includes registrations from 1891 to 1978. An electronic version of the Catalog is available for works registered after 1978, which allows individuals to search public records online.

To register a work with the Copyright Office, an applicant must submit:

• a completed application form;
• a non-refundable filing fee; and
• at least one copy of the work being registered.

The Copyright Office will accept paper applications. However, it is faster and more cost-effective to file online. Filing fees for copyright applications are available at copyright.gov.

Fixing Incorrect Information

To request minor corrections to the copyright application prior to registration, the applicant may contact the Public Information Office at the Copyright Office. If there are multiple or substantial corrections needed, the applicant may be required to resubmit the application.

If a certificate of registration has already been issued, the applicant must file a Supplemental Registration (Form CA) and submit the required fee (USD130). The supplemental registration will result in a separate effective registration date. The Copyright Office defers to the courts regarding which effective date is applicable in an infringement lawsuit.

Safe Harbour Provision

If an applicant unintentionally provides incorrect information in an application, the copyright may remain valid by operation of the safe harbour provision found in 17 USC Section 411(b)(1)(A).

Under the safe harbour provision, the registration remains valid unless:

• the applicant had knowledge the information was inaccurate; and
• if known, the inaccurate information would have caused the registration to be refused by the Copyright Office.

In 2022, the US Supreme Court clarified in Unicolors, Inc v H&M Hennes & Mauritz, LP, 595 US 178 (2022) that the safe harbour provision applies equally to mistakes of law and fact.

To register a copyright, the Copyright Office must determine that the material deposited constitutes copyrightable subject matter and that all other legal and formal requirements have been met by the applicant. If either are missing, the Copyright Office will issue a refusal, providing the reasons for the denial.

Common grounds for refusal:

• work lacks the minimum level of creative authorship;
• incomplete application, filing fee, and/or deposit copies;
• work is not covered by US copyright law;
• work lacks human authorship; and
• work is not fixed in a tangible medium of expression.

Requests for Reconsideration

Applicants may request reconsideration through an administrative appeal process. Applicants may make two such requests, with the required fee. The first request must be made within three months from the date of the initial refusal. The second request must be made within three months from the date of the Copyright Office’s response to the first request.

A request for reconsideration must include applicant’s argument as to why registration was improperly refused and any supplemental information or legal support.

The first request for reconsideration is reviewed by a Registration Programme staff attorney who did not participate in the initial examination of the application. A second request for reconsideration will be reviewed de novo by the Review Board. The Review Board consists of the Register of Copyrights, general counsel for the Copyright Office (or a designee), and a third individual designated by the Register.

A decision by the Review Board constitutes a final agency action on the application. If the Review Board upholds the refusal to register, the applicant may appeal the decision to federal court under the Administrative Procedure Act.

See 2.6 Related Rights.

In the USA, trade mark rights arise from use of the mark in connection with goods and/or services, not by registration. However, such common law rights are limited to the geographic area where the mark is in use.

Although registration is not necessary, it conveys significant legal benefits, including: 

• legal presumption of the owner’s exclusive right to use the mark in connection with the claimed goods and/or services throughout the entire USA;
• legal presumption of validity and ownership of the trade mark;
• the right to use the federal registration symbol (®);
• constructive notice of ownership;
• the right to file the trade mark registration with US Customs and Border Patrol to aid in preventing the importation of counterfeit or infringing goods;
• registration may serve as the basis for filing an application in a foreign country;
• the right to certain damages in federal infringement lawsuits (eg, profits, increased statutory damages, and costs); and
• the ability to obtain incontestable status after five years of registration, limiting available grounds for cancellation

For information regarding standards for registering different types of marks, see 2.1 Types of Trade Marks and 2.2 Essential Elements of Trade Mark Protection.

The USPTO maintains a Principal and Supplemental Register. The records on both registers are publicly available and accessible online. An attorney or outside search provider should conduct searches on behalf of applicants, as results may be misleading owing to USPTO registrability standards and conflicting marks that may not be identical matches.

The Supplemental Register allows for registration of trade marks that are in use in commerce but are otherwise ineligible for registration on the Principal Register. Such marks include:

• descriptive marks that are capable of acquiring distinctiveness or secondary meaning;
• surnames;
• geographic terms; and
• non-distinctive and non-functional trade dress.

Although not as broad as those afforded to marks on the Principal Register (see 4.1 Trade Mark Registration), the Supplemental Register still affords several benefits, including:

• the right to use the federal registration symbol (®);
• the ability to bring suit in federal court for trade mark infringement and unfair competition;
• the mark may be cited by an examining attorney against a later-filed application to refuse registration on the basis of likelihood of confusion;
• registration may serve as the basis for filing an application in a foreign country; and
• registration on the Supplemental Register may be used to prove exclusive use of a mark over a five-year period to support a claim of acquired distinctiveness.

The USA does not allow registration of series trade marks.

Term of Registration

Federal trade mark registrations may continue indefinitely if the trade mark remains in use in connection with the claimed goods and/or services. Trade mark owners must renew registrations by filing maintenance documents with the USPTO every ten years (and a declaration of continued use between the fifth and sixth anniversary of the registration date). Such renewals require submission of a declaration and evidence that the trade mark is in use in commerce with the claimed goods and/or services. The renewal may be filed as early as one year before the expiration date or as late as six months after the expiration date, with an additional fee. If the registration is not timely renewed, it will expire and cannot be revived.

Updating or Refreshing Registrations

A trade mark owner may update, refresh or modernise the mark reflected in its trade mark registration by filing a request to amend the registration certificate under Section 7(e) of the Lanham Act. Such amendments are generally permitted, as long as the updated version does not constitute a material alteration of the original mark. The relevant question is whether the new and old mark create essentially the same commercial impression.

Application Requirements

The USPTO provides the Trade Mark Manual of Examining Procedure (TMEP), which outlines all requirements to obtain a federal trade mark registration.

Since 15 February 2020, the USPTO requires mandatory electronic filing through the Trade Mark Electronic Application System (TEAS). Paper trade mark filings are no longer accepted.

An application for trade mark registration must include:

• a drawing of the mark;
• a verified statement executed by an authorised signatory for the applicant attesting to the accuracy of the application and the applicant’s belief of ownership over the mark;
• a completed trade mark application, including:
1. date application signed;
2. applicant’s identifying information;
3. identification of the goods/services claimed;
4. filing basis for registration; and
5. description of the mark;
• filing fee for each class of goods and/or services; and
• a specimen of use evidencing the mark’s use in commerce in connection with the claimed goods and/or services for an application based on Section 1(a), or a true copy of the applicant’s home country certificate of registration if application based on Section 44(e)

A complete application checklist is available at Section 818 of the TMEP.

Filing Basis

An applicant must specify the filing basis or the legal reason for why the applicant is entitled to registration of the trade mark.

Potential filing bases include:

• use in commerce (Section 1(a));
• intent to use in commerce (Section 1(b));
• foreign trade mark application (Section 44(d));
• foreign trade mark registration (Section 44(e)); and
• international registration filed through the Madrid Protocol.

Multi-Class Applications

The USPTO allows multi-class applications consisting of a single application requesting registration of a mark for goods and/or services in more than one international class. The applicant must pay a filing fee for each claimed class. For applications based on Section 1(a), the applicant must provide one specimen supporting use of the mark for each class. A single certificate of registration is issued.

Filing Fees

Fees vary depending on the type of application filed. The USPTO provides a complete list of fees on its website.

Applicants

A trade mark applicant can be:

• a natural person;
• a juristic person (eg, a firm, corporation, union, association, or other organisation capable of suing and being sued in a court of law); or
• nations, states, municipalities, or other governmental bodies.

Foreign applicants must appoint US counsel to represent them before the USPTO.

Use Required Prior to Registration

Use in commerce is a prerequisite to registration for applications filed under Section 1 of the Lanham Act, even if there is a secondary basis such as a foreign trade mark application (Section 44(d)) or a foreign trade mark registration (Section 44(e)).

For a use-based application (Section 1(a)), the mark must be in use in commerce on or in connection with all the goods and/or services listed in the application as of the application filing date.

For an intent-to-use application (Section 1(b)), the mark must be in use in commerce on or in connection with all the goods and/or services listed in the application as of the date of filing the statement of use. The statement of use must be filed within six months from the date of the Notice of Allowance issuance. If not in use, the applicant may request a six-month extension. A total of five extensions may be requested.

Applications relying solely on a foreign registration as the filing basis (Section 44(e)) or applications for an extension of protection of an international registration (Section 66(a)) are not required to assert actual use of the mark prior to registration. After registration, the trade mark owner must file a declaration of use to maintain the registration (see 2.3 Trade Mark Rights).

Requirements for Establishing Genuine Use

Use must be “in commerce” (see 2.4 Use In Commerce) and meet the statutory requirement of bona fide use of the mark in the ordinary course of trade, not made merely to reserve a right in a mark. To determine compliance with the bona fide use requirement, the following factors are considered:

• amount of use;
• nature or quality of the transaction; and
• what is typical use within a particular industry.

Goods

A trade mark must be placed in any manner on the good or its packaging, tags, labels, or on displays. If such placement is impracticable, then use can be established by using the mark on documents associated with the goods or their sale and the goods are sold or transported in interstate commerce.

Services

A trade mark must be displayed in the sale or advertising of services rendered in interstate commerce.

A trade mark application may be rejected if the mark is confusingly similar to an existing prior-filed trade mark. Likelihood of confusion is determined by considering a number of factors, including relatedness of the goods and/or services and the similarity between the marks.

If a refusal is issued on the basis of likelihood of confusion, the applicant can take any of the following paths to try to overcome it:

• submit arguments and evidence against the rejection to try to change the examiner’s mind;
• file a petition for cancellation against the cited; and/or
• seek consent or a co-existence agreement with the owner of the cited mark.

If the owner of the cited mark provides consent, the applicant should file a consent agreement with the USPTO to try to overcome the refusal. A valid consent must include a recitation of the facts and reasons why the parties believe there is no likelihood of confusion between the marks. In the absence of such facts and reasons, the consent will hold little to no weight and will likely be disregarded by the examiner.

Letters of Protest

During the examination period and prior to publication, a third-party may file a letter of protest presenting evidence bearing on the registrability of a mark. A letter of protest will be accepted if the evidence provided is relevant and supports any reasonable ground for refusal during examination. Upon acceptance, the evidence will be forwarded to the examining attorney for consideration during the examination of the application.

Common issues raised in letters of protest include:

• likelihood of confusion;
• mark is merely descriptive or generic for the identified goods and/or services;
• mark suggests a false connection with the protestor or a third party;
• mark is a widely used or commonplace message that fails to function as a trade mark;
• a registered trade mark appears in the identification of the goods and/or services in the application; and
• the specimen of use is fraudulent.

Opposition

Once an application has been published for opposition, any person who believes that they are or will be damaged by the registration of the mark may oppose registration by filing a notice of opposition with the Trade Mark Trial and Appeal Board (TTAB) (see 5. Trade Mark Opposition Procedure).

During the prosecution of a trade mark application, limited amendments may be made by the applicant or the USPTO. The applicant can narrow or limit the claimed goods and/or services but may not broaden them. The applicant can also alter or update the mark, provided the alteration is not material (see 4.4 Term of Registration (Updating or Refreshing Registrations)). Additionally, the listed applicant can be changed if there was a clerical error or if the application was properly assigned (7. Assignments and Licensing).

Amendments may also be made by the examining attorney through an examiner’s amendment. The applicant, or its representative, may authorise such amendments via telephone, email, or interview with the examining attorney.

When a mark is in use with some – but not all – of the goods and/or services listed in the application, an applicant may file a request to divide the application with payment of a fee. The result is the creation of a second “child” application under a new serial number. Typically, the child application will retain the same priority filing date as the original application. Following division, the mark may proceed to registration for the goods and/or services for which it is in use.

Generally, clerical-type errors in an application can be corrected. More substantive errors cannot be corrected and a new application is required. Decisions regarding corrections of incorrect information are made on a case-by-case basis by the examining attorney, subject to review by the director of the USPTO.

If an application meets the application requirements (see 4.5 Application Requirements), it is approved for registration unless there is a statutory basis for refusal.

Section 2 of the Lanham Act provides the following statutory bases for refusing registration if the mark:

• consists of deceptive matter;
• falsely suggests a connection with persons (living or dead), institutions, beliefs or national symbols;
• consists of geographical indication that, when used on or in connection with wines or spirits, identifies a place other than the origin of the goods;
• consists of or comprises the flag or coat of arms or other insignia of the USA, any state or municipality, or any foreign nation;
• consists of a name, portrait or signature identifying a particular living person without written consent;
• when used in connection with the goods and/or services of applicant, is likely to cause confusion, mistake or deception in relation to a prior registration;
• is merely descriptive or deceptively misdescriptive;
• is geographically descriptive or geographically deceptively misdescriptive;
• consists primarily of a surname;
• is comprised of matter that, as a whole, is functional; and
• is likely to cause dilution by blurring or tarnishment.

The Lanham Act also prohibits registration on the basis that the mark comprises immoral or scandalous matter. However, the Supreme Court has held in Iancu v Brunetti, 139 S Ct 2294 (2019) that such restrictions violate the First Amendment.

If an application is refused for failing to comply with any application requirement (see 4.5 Application Requirements) or on any statutory basis (see 4.12 Refusal of Registration), the examining attorney will issue an official letter known as an office action.

A first refusal is raised in a non-final office action. The applicant must respond within three months from the date the non-final office action issues, with an optional three-month extension available for a fee. However, for applications filed under the Madrid Protocol (Section 66(a)), the response deadline is six months with no extension option. If the applicant’s response satisfies all refusals raised in the non-final office action, the application will proceed toward registration. If the response fails to address the refusals raised, the examiner will issue a final office action. If new issues are raised as a result of the response, a new non-final office action will issue to address the new issues.

A final office action is the final refusal issued by the examining attorney. To respond to a final office action, the applicant must file a request for reconsideration to the examining attorney and/or a notice of appeal to the TTAB. The response time for a final office action is the same as for non-final office actions. Similarly, an appeal to the TTAB must be filed within six months of the final office action issue date. If the request for reconsideration satisfies each refusal in the final office action, the application will proceed toward registration. If not, the application will abandon unless the applicant filed a timely appeal with the TTAB (see 5.5 Legal Remedies Against the Decision of the Trade Mark Office).

If the refusal is maintained for failure to comply with procedural requirements, with no statutory refusals to register, the applicant may respond by filing a timely petition to the director within six months from the date of the final office action in order to cure the procedural defects.

Filing a request for reconsideration does not extend the deadline for filing a notice of appeal or a petition to the director. Accordingly, the applicant should file a notice of appeal prior to the expiration of the six-month deadline to preserve their right to appeal.

The USA is a party to the Protocol Relating to the Madrid Protocol. The Madrid Protocol allows trade mark owners to file one application to register a trade mark in multiple countries, if such countries are signatories.

Outbound Madrid Protocol Applicants

A US registration or application may be used as the filing basis for a trade mark application filed under the Madrid Protocol at the International Bureau of the WIPO. An applicant must own a US trade mark registration or pending application and must meet at least one of the following:

• be a national of the USA;
• have a domicile address in the USA; or
• have a real and effective industrial or commercial establishment in the USA.

An international application filed through the USPTO requires two fees:

• a fee for certifying the applicant’s international application (paid to the USPTO); and
• a fee for registering the international application and filing requests for extension of protection in the designated Madrid members (paid to WIPO).

Inbound Madrid Protocol Applicants

A trade mark owner may seek an extension of protection of the international registration to the USA. Applications filed through the Madrid Protocol (Section 66(a)) are examined by the USPTO in the same manner as US applications.

International registrations that designate the USA are renewed through WIPO. However, the trade mark owner must also file an Affidavit of Continued Use or Excusable Non-use at the USPTO between the fifth and sixth anniversary of the registration date to prevent cancellation. Likewise, trade mark owners must also file renewals every ten years from the date of registration (see 2.3 Trade Mark Rights and 4.4 Term of Registration).

The USPTO requires that a US-licensed attorney represent any applicant domiciled outside of the USA.

After a trade mark application is published in the Official Gazette, the initial deadline to file an opposition with the TTAB is 30 days. The opposition deadline may be extended, upon request from the potential opposer, to a maximum of 180 days from the date of publication. Extensions of time totalling 90 days are available without consent from the applicant. Cooling-off periods are not available; however, an opposition proceeding may be suspended for settlement discussions.

A notice of opposition must include a concise statement of the reasons the opposer believes it will be damaged by the registration and state the grounds for opposition. A notice of opposition may be based on any ground for refusal of registration (see 4.12 Refusal of Registration). If the opposer owns a famous mark, it may oppose on the grounds that the applied-for mark is likely to dilute the distinctiveness of the famous mark by blurring or tarnishment.

An opposition may be filed by any person or entity that believes it is or will be damaged by registration of the mark. An opposer is not required to own a trade mark registration to bring an opposition. At the pleading stage, the notice of opposition must allege facts sufficient to show that the opposer has an entitlement to a statutory cause of action (previously referred to as “standing”).

An entitlement to a statutory cause of action is established by:

• sufficient facts to demonstrate the plaintiff has a “real interest” in the proceeding; and
• a “reasonable basis” for the plaintiff’s belief that it would suffer some kind of damage if the mark is registered.

Common examples of an entitlement to a statutory cause of action include:

• competitors; and
• an applicant whose application was refused based on a likelihood of confusion with the opposed application.

Discovery and Motion Practice

Proceedings before the TTAB follow the Federal Rules of Civil Procedure and conduct discovery in a similar manner to those before federal courts. In opposition proceedings, there is a mandatory discovery conference, as well as initial disclosure requirements, followed by a period of discovery that typically includes interrogatories, requests for admission and requests for production of documents (each limited to 75 requests). Parties may request depositions.

Parties to an opposition proceeding may file the same motions as available in federal courts.

Testimony Period

At the conclusion of the discovery period and once the parties have complied with the pre-trial disclosure requirements, each party will have a 30-day testimony period to present – starting with the opposer. After the applicant’s testimony period, the opposer has an additional 15-day rebuttal period.

Following the testimony period, both parties submit briefs on the merits of the case and opposer may submit a reply brief. The opposition is then decided based on the parties’ briefs and accompanying evidence.

Oral Hearings

Oral hearings are optional and are scheduled only if a party submits a request with a fee. Most cases proceed without an oral hearing. An oral hearing may be useful in complex cases or cases with a complex record. If neither party requests an oral hearing, the case will be decided on the briefs and evidence submitted at the close of the testimony period.

Appeal to the Trade Mark Trial and Appeal Board

If the examining attorney issues a final office action and the applicant’s response fails to satisfy each refusal (see 4.13 Remedies Against the Trade Mark Office), the application will be abandoned unless an appeal is filed with the TTAB. During an appeal to the TTAB, both the applicant and examining attorney submit briefs supporting their positions regarding registration and no new evidence is permitted.

Appeal to Federal Court

An adverse decision by the TTAB may be appealed within 60 days of the decision to either the US Court of Appeals for the Federal Circuit or a federal district court. Federal courts give no deference to the TTAB decision and the applicant may present additional evidence, new issues and additional claims.

Trade Mark Cancellation

Within five years from the date of registration, a cancellation action may be initiated against a registration seeking cancellation on any basis for which it can be shown that the registration should not have been issued or should not be maintained. Once a registration has been registered for more than five years, the grounds for cancellation are limited by statute (see 6.2 Legal Grounds for Filing a Revocation/Cancellation Proceeding (Trade Marks – Grounds for Cancellation)).

Copyright Cancellation

Cancellation is an action taken by the Copyright Office whereby either the registration is invalidated under the applicable law and regulations or the registration number is replaced by a new registration under a different class.

If the cancellation is on the basis that the work does not constitute copyrightable subject matter or there is an unsatisfied statutory requirement (see 6.2 Legal Grounds for Filing a Revocation/Cancellation Proceeding (Copyrights – Grounds for Cancellation)), the copyright claimant will be notified of the proposed cancellation and will have 30 days to respond. If there is no response or the Copyright Office is unpersuaded by the claimant’s response, the registration will be cancelled.

The party seeking cancellation of another’s copyright must meet a high bar. Federal courts have held that cancellation of a copyright requires scienter (ie, intentional ill will) on behalf of the copyright claimant – see, for example, Original Appalachian Artworks, Inc v Toy Loft, Inc, 684 F.2d 821 (11th Cir 1982). In the absence of a showing of scienter, any inaccuracies in the copyright registration will be saved by the safe harbour provision (see 3.10 Incorrect Information in an Application (Safe Harbour Provision)).

Trade Marks – Grounds for Cancellation

Available grounds for cancellation depends on the length of registration.

Registered less than five years

Within five years of the registration date, a cancellation proceeding can be initiated against a registration on any basis for which it can be shown that the registration should not have been issued or should not be maintained. Cancellation based on the mark never being used in connection with some or all of the goods and/or services recited in the registration can be brought after three years from the date of registration.

Registered five or more years

After the fifth anniversary of registration, grounds for cancellation are limited to the following:

• genericness;
• functionality;
• abandonment;
• registration fraudulently obtained;
• mark has never been used in commerce (if registration less than ten years old);
• registration for a collective or certification mark obtained in contravention of the statute;
• mark consists of deceptive matter;
• mark falsely suggests a connection with persons, institutions, beliefs or national symbols (or brings them into contempt or disrepute);
• if the registration covers wines or spirits, the mark consists of a geographic indication other than the origin of the goods;
• mark consists of the flag, coat of arm or insignia of the USA, any state or municipality, or any foreign nation;
• mark consists of or comprises a name, portrait or signature identifying a particular living individual without their written consent;
• mark consists of the name, signature or portrait of a deceased President of the USA during the life of his widow (without written consent);
• mark is being used by, or with the permission of, the registrant to misrepresent the source of the goods and/or services on or in connection with which the mark is used; or
• for certification marks, on the ground that the registrant:
1. does not control, nor is able to legitimately exercise control over, the use of such mark;
2. engages in the production or marketing of any goods or services to which the certification mark is applied;
3. permits the use of the certification mark for purposes other than to certify; or
4. discriminately refuses to certify or to continue to certify the goods or services of any person who maintains the standards or conditions that such mark certifies.

Trade Marks – Expungement/Re-examination Procedures

The Trade Mark Modernization Act 2020 created two new statutory procedures for cancelling federal trade mark registrations that have not been used in commerce in connection with the claimed goods and/or services of the registration, as follows.

• Expungement proceedings – trade mark registrations may be subject to petitions for expungement, which are:
1. filed between three and ten years from the registration date;
2. applicable to registered marks that have never been used in commerce on or in connection with some or all of the claimed goods and/or services in the registration; and
3. available for registrations filed based on use in commerce (Section 1(a)), foreign registrations (Section 44(e)), or the Madrid Protocol (Section 66(a)).
• Re-examination proceedings – trade mark registrations may be subject to petitions for re-examination, which are:
1. filed within five years of the registration date; and
2. applicable to registered marks not in use in commerce in connection with the claimed goods and/or services as of the relevant date (either the date of filing for applications filed based on use (Section 1(a)) or as of the date of filing the allegation of use for applications filed based on an intent to use (Section 1(b)).

If the USPTO institutes expungement or re-examination proceedings, an office action will be issued – to which the trade mark owner will have three months (with a one-month extension available) to respond and provide evidence of use or prove excusable non-use, if applicable. The examining attorney will examine the evidence to decide whether the registration should be cancelled with regard to some or all of the goods and/or services at issue. If no response is received, the proceeding will terminate and the registration will be cancelled in whole or part, as appropriate.

Copyrights – Grounds for Cancellation

The Copyright Office may cancel a copyright registration in the following cases:

• the registration should not have been granted because the work does not constitute copyrightable subject matter or fails to satisfy a legal or formal requirement;
• the application, deposit material, or fee does not meet the requirements and the Copyright Office is unable to correct the defect; or
• an existing registration in the wrong class is replaced by a new registration in the correct class.

The Copyright Office may determine a work is not copyrightable if the authorship is insufficiently creative or the work does not contain authorship subject to copyright.

A trade mark cancellation proceeding may be initiated by any person who believes they are or will be damaged by the continued registration of a mark. The TTAB and federal courts have interpreted the standing requirement for petitioners to be relatively low, allowing anyone who is more than a “mere interloper” to institute a cancellation proceeding.

Expungement and re-examination proceedings have no standing requirements. The real party in interest does not even have to be identified in the petition.

A petition to cancel a federal trade mark registration is typically filed with the TTAB. Federal courts do not have independent jurisdiction to hear cases filed solely to cancel a federal trade mark registration. However, if the lawsuit involves claims related to the trade mark registration (ie, infringement), either party may request cancellation of the registrations at issue as a remedy. Petitions for expungement and re-examination are filed with the USPTO.

A trade mark registration can be partially cancelled if the grounds for cancellation apply only to a portion of the goods and/or services of the registration. By way of example, if the mark has never been used in connection with some of the listed goods and/or services, the registration will only be cancelled with regard to those goods and/or services with which the mark has never been used. The registration will remain in full force and effect with regard to the goods and/or services with which the mark has been used in commerce.

In trade mark cancellation proceedings where concurrent use is established, the USPTO may amend a registration to limit the identified goods and/or services to restrict the scope. In other cases, petitioners may seek a partial cancellation on the grounds of likelihood of confusion, which could be eliminated by a limitation to the conflicting goods and/or services in the registration. To succeed, the petition must prove that the limitation properly applies to the registrant’s goods and/or services as used and that such limitation will obviate the likelihood of confusion between the petitioner’s and registrant’s respective goods and/or services.

Parties may also agree to an amendment of the trade mark registration to resolve disputes such as entering into a co-existence or consent agreement (see 4.7 Consideration of Prior Rights in Registration).

The TTAB’s jurisdiction is limited to decisions regarding the registrability of trade marks and thus never decides claims of trade mark infringement.

Generally, when there is both a federal lawsuit for trade mark infringement and a related cancellation action at the TTAB, the TTAB will stay the cancellation proceedings pending the resolution of the civil action. Although the Supreme Court held in B&B Hardware, Inc v Hargis Industries, Inc, 135 US 1293 (2015) that issue preclusion can be based on a decision by the TTAB in a case where the ordinary elements of issue preclusion are met, the TTAB has continued its policy to suspend in favour of a civil action. Federal courts do not have independent jurisdiction to hear cases filed solely to cancel a federal trade mark registration. However, if there is some other independent basis for jurisdiction before the court, a cancellation claim may be pleaded as an additional claim or counterclaim for relief. 

Addressing Trade Mark Fraud

Trade mark registrations obtained by fraud are subject to cancellation actions (see 6.1 Timeframes for Filing Revocation/Cancellation Proceedings (Trade Mark Cancellation) and 6.2 Legal Grounds for Filing a Revocation/Cancellation Proceeding (Trade Marks – Grounds for Cancellation)). Additionally, registrations filed under Section 1 of the Lanham Act that are obtained by a fraudulent claim of use in commerce are subject to a petition for re-examination (see 6.2 Legal Grounds for Filing a Revocation/Cancellation Proceeding (Trade Marks – Expungement/Re-examination Procedures)).

In recent years, the USPTO has made a push to combat the submission of fraudulent specimens. If an examining attorney believes there is any indicia of fraud, they may issue an office action seeking further information or specimens and may refuse registration if the applicant fails to provide satisfactory responses.

The USPTO has also launched the Trademarks Administrative Sanctions Process to investigate improper trade mark-related submissions. If the process uncovers a submission that violates the Trademark Rules, the USPTO will issue an administrative order that may include the imposition of sanctions.

Sanctions may include:

• striking submissions;
• precluding parties from appearing before the USPTO;
• terminating USPTO.gov accounts; and
• terminating proceedings.

Addressing Copyright Fraud

Incorrect information in a copyright application may be saved by operation of the safe harbour provision if the mistake was made without knowledge (see 3.10 Incorrect Information in an Application (Safe Harbour Provision)). Moreover, federal courts have held that cancellation of a copyright registration based on incorrect information requires a finding of scienter (see (see 6.1 Timeframes for Filing Revocation/Cancellation Proceedings (Trade Mark Cancellation)).

Trade Mark Assignment

A trade mark assignment is a transfer of all rights, title and interest in a trade mark. The assignor (transferring party) transfers the rights to the assignee (receiving party).

An assignment must be a writing duly executed by the assignor (or an authorised representative) and identify:

• the parties;
• the mark(s) being assigned;
• the USPTO application(s) and/or registration(s) for such mark(s), if applicable; and
• the effective date of the assignment.

An effective assignment must include a transfer of the goodwill of the business associated with the trade mark. Failure to include the associated goodwill can result in an assignee losing rights to the assigned trade mark.

Copyright Assignment

A “transfer of copyright ownership” includes:

• assignments;
• mortgages;
• grants of an exclusive licence;
• transfer by will or intestate succession; or
• any conveyance, alienation or hypothecation of any or all of the exclusive rights in a copyright.

It does not include a non-exclusive licence. Generally, assignments must be made in writing and signed by the owner of the rights or the owner’s authorised agent. If the assignment involves the transfer of a non-exclusive right, a writing is not required.

Trade Mark Licensing

A licence grants permission to use a trade mark in some manner but does not transfer any rights of ownership in the mark. Licences include: exclusive, non-exclusive, for some or all the goods and/or services listed in the registration, for specific geographic areas. A licence must include quality controls ensuring the trade mark is being used precisely as the trade mark owner designates. Failure to include quality controls will result in a “naked licence”. There is no requirement to record a licence – although doing so provides notice to third parties of the licensee’s rights.

There is no limit to the duration of a licence. Most licences are not perpetual, however, as this would raise issues regarding the requirement to exercise quality control.

Copyright Licensing

If a copyright licence transfers economic rights, it must be in writing and signed by the copyright holder. However, if the right transferred is on a non-exclusive basis, no writing is needed. Often, third-party organisations are authorised to grant licences on the copyright owner’s behalf; this is known as collective rights management (see 3.7 Collective Rights Management Systems).

Common types of licences include:

• Creative Commons licence – applied by the copyright owner to its own works, thereby allowing the free distribution of an otherwise copyrighted work; and
• copyleft licence – offering users of a work the right to freely distribute and modify the original work, under the condition that the derivative work be licenced with the same rights.

Trade Marks

Both trade mark registrations and applications may be assigned. However, the USPTO places restrictions on assigning applications filed on an intent-to-use basis to prevent trade mark prospecting or filing applications to sell them to others.

A trade mark application filed on an intent-to-use basis may only be assigned after filing a statement of use. However, an intent-to-use application that is not yet in use may be assigned together with the assignor’s business connected with the mark. Assigning an intent-to-use application without meeting the statutory requirements can invalidate the trade mark rights.

If a mark is not yet in use in commerce but is the subject of an intent-to-use application, it can be licensed and the licensee’s use of the mark will inure to the benefit of the licensor and can be used to demonstrate use for purposes of registration.

Copyrights

Copyright applications may be assigned by the same means as assigning a registration (see 7.1 Assignment Requirements and Restrictions (Copyright Assignment)).

Recording a Trade Mark Assignment or Licence

Even though recordation of a trade mark assignment with the USPTO is not required, a written assignment – duly acknowledged and recorded – is prima facie evidence that enables the assignee to invoke the registration against third parties.

A trade mark assignment is void against any subsequent purchaser for valuable consideration who is without notice of the prior assignment, unless the assignment is recorded in the USPTO within three months after the date of the assignment or prior to the subsequent purchase. Additionally, an unrecorded assignment may not be effective against a subsequently dated but recorded assignment.

Similarly, a trade mark licence is not required to be recorded. However, as mentioned in 7.2 Licensing Requirements or Restrictions (Trade Mark Licensing), doing so provides notice to third parties of the rights of the licensee.

Recording a Copyright Assignment or Licence

Although not required, a copyright assignment or licence may be recorded with the Copyright Office. Recordation may provide several benefits, including:

• establishing legal priority between conflicting transfers or between a transfer and a nonexclusive licence;
• establishing a public record of the contents of the transfer;
• some courts require recordation of a transfer to perfect a creditor’s security interest; and
• providing “constructive notice” imputed on third parties.

Under the Copyright Act Sections 203 (applicable to transfers and licences executed after 1 January 1978) and 304 (applicable to transfers and licences executed before 1 January 1978), an author or their surviving spouse or heirs may recapture transferred rights for works not made for hire. Grants may be terminated during a five-year window from the 35th anniversary of the grant (under Section 203) or during a five-year window from the 56th anniversary of the date the copyright was secured (under Section 304).

For termination to be effective, the author or heirs must serve an advance written “notice of termination” on the grantee or the grantee’s successor-in-interest. The notice must be recorded with the Copyright Office, along with payment of the required fee. Recordation must occur before the effective date of termination specified on the notice.

The purpose of allowing such termination is to allow authors and successors to regain rights they may have granted at a time when they lacked bargaining power. If exercised, only the US rights will revert; foreign granted rights are excluded.

Trade Marks as Security

A trade mark is a form of property and an asset to the trade mark owner. As such, trade marks can be:

• used as a security interest;
• subject to rights in rem;
• assigned by way of security; and
• levied in execution.

Each of the above-mentioned transactions should be recorded with the USPTO. However, an assignment of an application filed on an intent-to-use basis and not yet in use cannot be used as a security interest. Assignment of an intent-to-use application for purposes of a security interest will void both the assignment and the application.

Copyrights as Security

A copyright may be used as a security interest. However, in order to perfect a security interest in a registered copyright (or a pending application), lenders must file a security agreement with the Copyright Office. Generally, priority is given to the first executed transfer over the first recorded transfer.

Trade Mark Infringement Lawsuits

There is no statute of limitations for filing trade mark infringement claims under the Lanham Act. Such claims are subject to the equitable defence of laches – ie, the plaintiff has unduly delayed in bringing an action to the extent that the defendant has been prejudiced. If laches is asserted as a defence, the federal court will look to the analogous statute of limitations for the corresponding claim under state law in the state where the federal court sits. The court then applies a rebuttable presumption that the state statute of limitations is applicable to the laches claim to determine whether the plaintiff’s claim should be barred.

Copyright Infringement Lawsuits

The statute of limitations for a copyright infringement claim is three years. Jurisdictions vary on how to measure the time. Some jurisdictions measure from the date of the infringement, others measure from the time that the infringement was discovered or should reasonably have been discovered using reasonable diligence.

The statute of limitations for a copyright ownership claim is three years from the time when a reasonably diligent plaintiff would have been put on notice that someone else was making a claim of ownership or repudiating the plaintiff’s ownership.

Trade Mark Infringement – Available Claims

In addition to trade mark infringement, a plaintiff may bring a variety of claims, including:

• false advertising;
• unfair competition;
• dilution by blurring or tarnishment;
• unjust enrichment;
• injury to business reputation; and
• cybersquatting.

Trade mark infringement

Per 15 USC Sections 1114 (registered mark) and 1125(a) (unregistered mark), a successful trade mark infringement claim may be made where:

• the plaintiff has a valid and legally protectable mark;
• the plaintiff owns the mark; and
• the defendant’s use of the mark to identify goods and/or services causes a likelihood of confusion (as discussed in 8.3 Factors in Determining Infringement (Trade Mark Infringement Factors)).

Unfair competition/false advertising

Per 15 USC Section 1125(a), the following elements must be present to prove unfair competition/false advertising:

• use of false or misleading statements of fact;
• actual or likely deception among substantial portions of likely audience;
• deception is material as it is likely to influence purchaser decision;
• must involve interstate commerce; and
• commercial or competitive injury has occurred or is likely to occur.

Trade mark dilution

Per 15 USC Section 1125(c), a successful trade mark dilution claim may be made where:

• the plaintiff owns a famous mark that is distinctive;
• the defendant is using a similar mark in commerce that confuses or diminishes the public’s perception of plaintiff’s famous mark;
• the defendant’s use of the mark began after the plaintiff’s mark became famous; and
• the defendant’s use of the mark is likely to cause dilution by:
1. blurring – the distinctiveness of a famous mark is impaired by association with another similar mark or trade name; or
2. tarnishment – the reputation of a famous mark is harmed through association with another similar mark or trade name.

Copyright Infringement – Available Claims

Copyright infringement

Per 17 USC Section 501, a successful copyright infringement claim may be made where:

• the plaintiff owns a valid copyright; and
• the defendant infringed upon plaintiff’s copyright (such as by distributing, copying, publicly displaying, performing, and/or using plaintiff’s copyrighted work without plaintiff’s permission).

Criminal copyright infringement

Per 17 USC Section 506(a), criminal copyright infringement occurs where:

• the plaintiff owns a valid copyright;
• the defendant infringed upon plaintiff’s copyright;
• the defendant acted wilfully; and
• the defendant sought financial gain or had another commercial impetus.

Indirect Liability

Secondary or indirect liability is a judicially created doctrine that has evolved with common law and is highly dependent on the relationship between the accused party and the direct infringer.

Contributory liability

To establish contributory liability, a plaintiff must show that the defendant either:

• intentionally induced another to infringe on the plaintiff’s trade mark or copyright; or
• continued to supply its product to one whom it knows or had reason to know was engaging in infringement of the plaintiff’s trade mark or copyright.

Vicarious liability

Courts have applied vicarious liability in two circumstances:

• application of agency principles to parties involved in the infringement; or
• the joint-tortfeasor liability doctrine.

Trade Mark Infringement Factors 

As mentioned in 8.2 Legal Claims for Infringement Lawsuits and Their Standards (Trade Mark Infringement – Available Claims), in order to establish a trade mark infringement claim, the plaintiff must show that:

• the plaintiff owns a valid trade mark;
• the plaintiff’s trade mark rights were established prior to the defendant’s alleged infringement; and
• the defendant’s use of its mark used in connection with defendant’s goods and/or services is likely to cause confusion.

In evaluating whether there is a likelihood of confusion, courts consider various factors, including (but not limited to):

• similarity of the marks;
• commercial strength and inherent distinctiveness of the plaintiff’s mark;
• relatedness of the goods and/or services for which the competing marks are used;
• channels of trade through which the parties offer their respective goods and/or services;
• relevant class of potential purchasers of the respective goods and/or services;
• sophistication of those purchasers; and
• evidence of actual confusion.

Copyright Infringement Factors

Under the Copyright Act, determining whether a defendant has infringed a plaintiff’s copyright requires a determination of whether defendant’s use constitutes “fair use” (see 10.2 Defences to Copyright Infringement (Fair Use/Fair Dealing)).

In civil actions for trade mark or copyright infringement, the parties typically include the trade mark or copyright owner (plaintiff) and those parties accused of infringement (defendant(s)). When the defendant(s) include corporations or other business entities, the owners, managers, officers and/or directors may also be named as a defendant and held personally liable if they actively participated in or directed the infringement.

If an exclusive licensee has a licence that effectively grants rights akin to ownership of the mark, the licensee may initiate a claim for infringement and/or false designation of origin. Non-exclusive licensees do not have standing to pursue infringement claims.

Class actions are permitted in the USA and are more common for copyright proceedings than for trade marks. Given the nature of trade marks being a single source identifier, it is unlikely the circumstances would arise that would make a class action appropriate. Additionally, multiple plaintiffs could join together in an action against a defendant or group of defendants without constituting a class action.

Plaintiffs must demonstrate the following to bring a class action:

• the class is so numerous that joinder of all members is impracticable;
• there are common questions of law or fact applicable to the entire class;
• the defences of the representative parties are typical of the entire class; and
• the representative plaintiffs will fairly and adequately protect the interests of the class.

Trade Mark Infringement – Prerequisites and Restrictions

There are no prerequisites required before filing an infringement lawsuit. It is common practice to send a demand letter to try to resolve the dispute prior to filing a lawsuit, but that is optional. However, a demand letter will help establish the infringer’s actual knowledge of the trade mark owner’s claims, which can be used as evidence to establish intentional infringement if the infringer does not cease the infringement. Intentional infringement can entitle the plaintiff to enhanced damages.

While not a prerequisite for filing a lawsuit, the owner of a federal trade mark registration should give notice of its registration through use of the ® symbol or other forms of acceptable notice (see 2.5 Notices and Symbols). Failure to give notice that the mark is registered will prevent the plaintiff from being able to recover certain damages, including the infringer’s profits, in the absence of proof of the infringer’s actual knowledge of the registration.

Copyright Infringement – Prerequisites and Restrictions

Registration with the Copyright Office is a prerequisite for filing a copyright infringement claim in federal court and is necessary in order to seek remedies under the Copyright Act. The plaintiff must also prove that it holds the copyright interest through creation, assignment or licence.

Although not required, it is common practice to send a demand letter to try to resolve the dispute prior to filing a lawsuit. A demand letter may establish the infringer’s actual knowledge of the copyright owner’s claims, which can be used as evidence to establish wilful infringement if the infringer does not cease the infringement.

Copyright notice is optional for works published on or after 1 March 1989, unpublished works, and foreign works and thus is not a prerequisite for filing a lawsuit. However, use of proper copyright notice (see 3.6 Notices and Symbols) may provide benefits to the claimant – for example, preventing the infringer from raising an innocent infringement defence.

In federal court, a lawsuit is commenced in district court. The district court’s decision may be appealed to the appropriate circuit court of appeal based on the geographic location of the district court. The federal appellate court’s decision may be appealed to the US Supreme Court.

In state court, a lawsuit is commenced in the trial court. The trial court’s decision may be appealed to the appropriate state court of appeals based on the geographic location of the trial court. The state appellate court’s decision may be appealed to the state’s highest court.

Pursuant to Federal Rule of Civil Procedure 8, a complaint must contain:

• a short plain statement of the basis of the court’s jurisdiction;
• a short plain statement of the claim; and
• a demand for judgment for the relief sought.

A complaint may plead claims or request certain relief, in the alternative. While a detailed recitation of the facts is not necessary, the complaint must be plausible on its face and bring forth sufficient factual allegations to nudge the claim across the line from conceivable to plausible.

An initial complaint can be amended once as a matter of course within 21 days after service or 21 days after an answer or motion to dismiss, motion to strike, or motion for a more definite statement has been filed by the defendant. Thereafter, the complaint may only be amended with the defendant’s consent or the approval of the court. Local rules may slightly modify these rules and state courts have similar but not necessarily identical rules.

A defendant may file a counterclaim against the plaintiff if such claims exist. Often in infringement cases, counterclaims include a claim to cancel the plaintiff’s claimed registration. If the counterclaim is related to the plaintiff’s claims, it is a compulsory counterclaim that must be asserted or the defendant will likely be barred from asserting the claim in a subsequent lawsuit.

An accused infringer may bring a declaratory judgment action if a trade mark or copyright owner has threatened to take legal action, but has not yet filed a lawsuit. Generally, declaratory judgment actions request that the court issue an order declaring that the accused infringer is not infringing the trade mark owner’s alleged rights and/or that the trade mark or copyright is invalid or unenforceable.

To establish the court’s jurisdiction over a declaratory judgment action, the plaintiff cannot merely seek the advice of the court but must demonstrate there is an actual controversy between the parties that the declaratory judgment will resolve.

An actual controversy may be established by demonstrating an injury in fact that is:

• concrete and particularised and actual or imminent, rather than conjectural or hypothetical;
• causally connected and fairly traceable to the conduct complained of; and
• addressable by a favourable decision.

A request for declaratory judgment may also be raised in a counterclaim once a plaintiff has already filed a lawsuit alleging infringement. However, if the declaratory judgment counterclaim merely mirrors the claim for infringement, it may not survive a motion to dismiss.

Demand and Notice Letters

Whether a demand letter is enough to establish standing to bring a declaratory judgment action is determined on a case-by-case basis. A letter demanding that the infringer cease all alleged infringement by a particular date under the threat of an impending lawsuit would likely establish the requisite standing. Conversely, a letter simply putting the accused infringer on notice of the trade mark owner’s rights and the potential for a conflict may not be enough to establish there is an actual controversy.

Opposition/Cancellation Proceedings

Federal courts have held that the filing of an opposition or cancellation before the TTAB is not enough to establish standing to bring a declaratory judgment action.

There are no administrative or judicial bodies that handle small claims regarding trade marks.

The Copyright Claims Board (CCB) is an ADR forum to resolve copyright disputes up to USD30,000 total. Bringing a claim to the CCB is voluntary but there are advantages to utilising the CCB proceedings for smaller claims. CCB proceedings are intended to be streamlined, less expensive, and before a panel of copyright experts as opposed to a jury or federal judge. Proceedings are handled completely electronically and remotely. The CCB consists of three officers appointed by the Librarian of Congress on the recommendation of the Register of Copyrights.

The CCB hears the following claims:

• infringement of one of the exclusive rights in the Copyright Act;
• declaration of non-infringement;
• misrepresentation during the notice and counter-notice process for takedown or reinstatement of material on the internet under the Digital Millennium Copyright Act (DMCA);
• counterclaims related to the original claims; and
• all legal or equitable defences under copyright law or otherwise available.

To bring a claim before the CCB, a plaintiff must either:

• have a copyright registration from the Copyright Office for the work(s) at issue; or
• have submitted an application to register the work(s) at issue either before or simultaneously with filing the claim.

The applicable statute of limitations to bring a claim in front of the CCB is three years from the date on which the infringing activity took place.

Relief at the CCB is primarily monetary, capped at USD30,000. The CCB cannot issue injunctions.

For claims seeking damages less than USD5,000, a claimant may utilise the CCB’s “smaller claims” procedures, meaning the case will be determined by a single officer.

Effect of Decisions by the USPTO and the TTAB

Decisions by the USPTO examining attorneys, such as refusing registration, do not have preclusive effect on the TTAB or federal courts but may have limited persuasive value.

The US Supreme Court has held in B&B Hardware, Inc v Hargis Industries, Inc, 135 US 1293 (2015) that decisions by the TTAB may be preclusive on federal courts in cases where the ordinary elements of issue preclusion are met. This decision specifically addressed the preclusive effect of TTAB decisions on the issue of likelihood of confusion in an inter partes proceeding (eg, opposition or cancellation proceeding). However, federal courts have expanded the Supreme Court’s decision to include other potentially dispositive issues such as priority of rights and fraud on the USPTO.

Effect of Decisions by the Copyright Office and the CCB

Decisions by the Copyright Office regarding whether to register a copyright do not have any preclusive effect on federal courts but may have limited persuasive value.

A final decision by the CCB has limited preclusive effect in that it precludes the re-litigation of the same issues between the same parties before any court, tribunal, or the CCB. However, the decision will not have preclusive effect in the following circumstances:

• litigation between the same or different parties before any court, tribunal, or the CCB, of the same or similar issues of fact or law in connection with claims or counterclaims not asserted or finally determined by the CCB;
• a determination of ownership of a copyrighted work for purposes of resolving a matter at the CCB may not be relied upon or have preclusive effect before any court, tribunal, or the CCB; and
• any determination of the CCB may not be cited or relied upon as legal precedent in any other action or proceeding before any court, tribunal, or the CCB.

Trade Mark Counterfeiting

A counterfeit mark is a spurious mark that is identical to, or substantially indistinguishable from, a registered trade mark. Special damages are available in civil cases where trade mark counterfeiting is established – namely, in lieu of actual damages, the plaintiff may elect to recover statutory damages between USD1,000 and USD200,000 per counterfeit mark per type of good or service. Where the counterfeiting is found to be wilful or intentional, statutory damages may be increased to a maximum of USD2 million per counterfeit mark per type of good or service and actual damages can be increased by up to three times. Additionally, where intentional counterfeiting is proven, an award of attorney’s fees is mandatory, unless there are extenuating circumstances.

Trade mark owners may also seek an order to seize counterfeit materials and instrumentalities if the plaintiff can show that the defendant is likely to conceal or transfer the materials. Such order may be served and executed by federal, state or local law enforcement.

Trade mark counterfeiting can also be a criminal offence, subject to fines and/or imprisonment (see 9.6 Infringement as an Administrative or Criminal Offence (Trade Mark Criminal Offences)).

Copyright Counterfeiting

Copyright counterfeiting refers to the intentional copying of a plaintiff’s copyrighted works, or wilful copyright infringement. Under Section 504 of the Copyright Act, such wilful infringement entitles the plaintiff to enhanced statutory damages “to a sum of not more than USD150,000”.

Bootlegging refers to the illegal production, reproduction or distribution of a copyrighted work without authorisation or licence. Often, bootlegging refers to illegally obtaining a recording that is then distributed.

The Federal Rules of Civil Procedure apply to trade mark and copyright proceedings filed in federal district court. If filed in state court, the state’s rules of civil procedure apply. Local court rules and individual judge’s rules will also apply at both federal and state courts.

Effect of Trade Mark Registration

Trade mark registration is not a requirement to bring a claim of trade mark infringement. However, a registration may convey significant litigation benefits (see 4.1 Trade Mark Registration).

If the registration has become incontestable, the registration constitutes conclusive (rather than presumptive) evidence of the validity and ownership of the mark, and the owner’s exclusive right to use the mark in connection with the claimed goods and/or services throughout the USA. Incontestability also limits the grounds for which a registration can be cancelled.

Effect of Copyright Registration

Registration of the claimed copyright with the Copyright Office is a prerequisite for filing a claim in federal court (see 8.6 Prerequisites and Restrictions to Filing a Lawsuit (Copyright Infringement – Prerequisites and Restrictions)).

Disclosures

In federal court, the TTAB and some state courts, parties must voluntarily disclose certain information at the beginning of the case. Such disclosures typically include the disclosure of documents and potential witnesses with relevant information that the party may use as part of its case. Some courts require more substantial disclosures.

Discovery

Discovery is the formal process by which the parties exchange information and documents related to the case. In federal courts and the TTAB, discovery is governed by the Federal Rules of Civil Procedure, with slight variations found in the TTAB’s Manual of Procedure (TBMP). The Federal Rules of Civil Procedure promote a liberal discovery approach, allowing parties to obtain discovery “regarding any non-privileged matter that is relevant to any party’s claim or defence”.

Parties have several discovery tools, including interrogatories, depositions, requests for production of documents and things, and requests for admission. The number of requests a party may serve is governed by rules of procedure and applicable local rules.

Experts

If a party intends to call an expert witness, it must disclose the identity of the expert and their opinion during the discovery period. Typically, the expert must also prepare and provide a written report and may be deposed by the opposing party.

Trade Mark Infringement – Role of Experts and Surveys

Experts

Most commonly, experts are used to address issues of damages, likelihood of confusion, acquired distinctiveness, and genericness. To be admissible, the party proffering the expert testimony must show that the expert is qualified by knowledge, skill, experience, education and/or training to offer an opinion on the matter.

If qualified as an expert, the expert’s testimony will be admitted if:

• the court determines the expert’s testimony will be helpful to the fact finder (judge or jury) to understand the evidence or determine a fact at issue;
• the expert’s testimony is based upon sufficient facts and is the product of reliable principles and methods; and
• the expert has reasonably applied the principles and methods to the facts at issue.

Surveys

Surveys can provide strong evidence in trade mark litigations, particularly in determining a likelihood of confusion and/or the strength and recognition of a trade mark. Survey evidence is not required, but failure to present survey evidence may be held against a party – particularly in cases concerning an alleged likelihood of confusion.

A party seeking to present survey evidence should consider how the survey is designed and conducted to avoid the court excluding it for lack of reliability. Parties may seek the assistance of experts to design and implement the survey to confirm adherence to legal precedent and rules.

Copyright Infringement – Role of Experts

In addition to the foregoing, the use of experts in copyright matters is not required but may be critical in certain copyright cases, such as those involving nuanced or technical issues concerning copyrights for music and software.

However, in addressing the issue of substantial similarity, experts will carry less weight and parties should instead employ the “ordinary observer test”, which considers a work’s “total concept and feel” to be weighed and decided by the fact finder (judge or jury).

The cost of bringing a civil action through to a decision will vary case by case.

Pre-Filing Costs

Pre-filing costs are largely dependent on factors such as:

• the nature and amount of diligence undertaken in order to investigate the alleged infringement;
• steps taken to negotiate with the infringer prior to filing;
• decisions to hire an investigator to collect evidence or make purchases of infringing goods; and
• electing to conduct a survey and the scope of any such survey.

Litigation Costs

Once filed, the expected cost of litigation from start to finish (exclusive of appeals) is highly speculative. At a minimum, costs that should be anticipated include the filing of the complaint, conducting discovery, pre-trial motion practice, pre-trial preparation, trial, and post-trial motion practice.

How much a party is willing to spend on a litigation can involve several considerations, including the importance of the right at issue, amount in dispute, complexity of the issues, and geographic location of the lawsuit. Additionally, if the case is not settled or disposed of by motion, a final decision can take years.

Trade Mark Criminal Offences 

Claims for trade mark infringement are typically civil matters enforced by a trade mark owner in a civil action filed against the accused infringer(s).

While trade mark counterfeiting can be addressed civilly, criminal offences may also be brought by the government. To establish criminal liability for counterfeiting, the government must prove:

• the defendant trafficked or attempted to traffic in goods or services;
• such trafficking, or attempt to traffic, was intentional;
• the defendant used a counterfeit mark on or in connection with such goods or services; and
• the defendant knew that the mark was counterfeit.

If a criminal defendant is found guilty of counterfeiting, they may be subject to fines and/or imprisonment. Upon determining that goods bear counterfeit marks, courts may order the destruction of the counterfeit goods.

Copyright Criminal Offences

Under Section 506(a) of the Copyright Act, criminal sanctions may be available if a party has wilfully infringed a copyright for the purpose of commercial advantage or private or financial gain by reproducing or distributing one or more copies or phonorecords of a work valued at more than USD1,000 in any 180-day period or by electronically distributing a work being prepared for commercial distribution.

In cases involving criminal infringement, available remedies include:

• forfeiture and destruction of infringing articles; and
• restitution.

It is unsettled whether courts require a copyright registration for the government to bring a criminal complaint. However, an essential element of a criminal copyright infringement claim is the existence of a “valid” copyright – something that a registration strongly evidences.

A defendant may assert affirmative defences – meaning those defences in relation to which the defendant bears the burden of proof .

Available affirmative defences may include:

• the defendant’s prior use of the mark;
• the plaintiff’s mark or registration is invalid;
• the plaintiff’s mark has become generic;
• misuse of trade mark;
• fair descriptive use;
• parody;
• abandonment;
• licence;
• laches;
• acquiescence;
• waiver;
• estoppel;
• use protected by the First Amendment;
• unclean hands; or
• fraud on the USPTO.

Notably, courts differ in their treatment of claims of nominative fair use. Nominative fair use refers to the defendant’s use of the plaintiff’s mark to refer to the plaintiff or the plaintiff’s goods and/or services. Courts such as the Third Circuit Court of Appeals treat nominative fair use as an affirmative defence. Other courts, such as the Ninth Circuit Court of Appeals, apply a different test to the evaluation of likelihood of confusion.

Under the Copyright Act, determining whether a defendant has infringed a plaintiff’s copyrights requires a determination of whether defendant’s use constitutes “fair use”. Fair use is commonly found in instances of “criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research” (17 USC Section 107 (non-exhaustive list)).

Fair use determinations are fact-specific and courts consider the following factors, as per Section 107 of the Copyright Act:

• “the purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes;
• the nature of the copyrighted work;
• the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
• the effect of the use upon the potential market for or value of the copyrighted work”.

Courts generally give the most weight to factors 1 and 4.

Factor 1

In addition to commercial versus non-commercial use, this factor considers whether the new work is “transformative” (ie, whether it adds purpose or character to the prior work).

Factor 2

This factor considers the nature of the copyright work – for example, the unauthorised use of a largely factual work is more likely to be deemed fair use. More creative works are closer to the works intended to be protected by copyrights under the law.

Factor 3

This factor considers the amount of the original work used in the new work. Accordingly, if more of the original work is used, it is less likely the court will find fair use. If copying a large portion of the original work is necessary in order to transform it, the amount copied may be less important in the court’s determination. Connected with this factor is whether the “heart” of the original work was used in the new work.

Factor 4

This factor concerns the likelihood of market harm to the original work and its derivatives that may result from the introduction of the new work into the market. Connected with this factor is the court’s balance between the benefit to the public if the new work is permitted to enter the market versus the personal gain to the copyright owner if the same is denied.

The Copyright Act does not provide for any express exception for private copying, but does contain various provisions that protect forms of private copying.

Education and Computer Programs

Copies made for certain educational purposes are protected as fair use. Covered education purposes include copies for classroom use, back-up copies of electronic media, recording time-shifted television broadcasts, and non-commercial archiving of personal properties (CDs and DVDs).

Audio Home Recordings

The Audio Home Recording Act (Section 1001) protects home copying of pre-recorded music, such as music airing over the radio, for personal use.

Libraries and Archives

See 10.6 Library and Archive Rights.

Trade Marks

There are no special rules or exceptions relating to trade mark infringement carried out by intermediaries such as internet service providers (ISPs). Currently, intermediaries may be liable for trade mark infringement under theories of contributory or vicarious liability (see 8.2 Legal Claims for Infringement Lawsuits and Their Standards (Indirect Liability)).

Copyrights

Under the Digital Millennium Copyright Act (DMCA), there is an exception to copyright infringement for activities carried out by intermediaries such as ISPs. The DMCA provides the following four categories of safe harbours that, if the ISP can satisfy the requirements, will limit the ISP’s liability for infringement claims:

• transitory digital network communications;
• system caching;
• information residing on systems or networks at the direction of users; and
• information location tools.

For the DMCA to be applicable, the ISP must have adopted and reasonably implemented a repeat infringer policy that permits the termination of subscribers in appropriate circumstances. The specific requirements for applicability of each of the above-mentioned safe harbours can be viewed in the statute.

Trade Mark First Sale Doctrine

After the initial sale of a good by the trade mark owner or authorised seller, the trade mark rights are exhausted – meaning the purchaser is free to resell the product without infringing the trade mark owner’s rights. However, such resellers cannot hold themselves out to be authorised or related to the trade mark owner without the trade mark owner’s permission.

Copyright Exhaustion Doctrine

Under Section 109 of the Copyright Act, after the first authorised sale or distribution of the copyrighted work, the copyright owner’s right to control the distribution of the lawful copy is exhausted. Meaning, the purchaser of a copy of the work has the right to resell it or otherwise dispose of the work free from interference by the copyright owner.

The Copyright Exhaustion Doctrine is not applicable to electronic works such as MP3s, e-books, and videostreams, as these works are treated as licensed rather than sold. Additionally, the doctrine would not apply to physical copies of electronic materials, such as printing out an e-book.

The Copyright Act protects libraries or archives that engage in private copying so long as the organisations “reproduce no more than one copy or phonorecord of a work” (17 USC Section 108). Such reproduction must not be made for commercial advantage, the organisation’s collection must be open to the public, and the reproduction must include a notice of copyright or similar “legend” stating that the work is copyright-protected.

For unpublished works, libraries or archives are permitted to duplicate the work from their collection solely for the purpose of preservation or to deposit for research use in another library or archive. However, any digital copy may not be further distributed or shared publicly.

For published works, libraries or archives are permitted to duplicate the works solely for replacement purposes in order to safeguard against damage, deterioration, loss, theft, or obsolescence of its storage format – provided they ensure that the unused replacement cannot be obtained at a fair price and the digital copies are not made publicly available.

In federal courts, plaintiffs may seek equitable relief such as a temporary restraining order or a preliminary or permanent injunction to prevent the defendant from engaging in any future infringement.

Prior to granting a preliminary injunction, the court must consider and balance the following factors:

• the plaintiff’s likelihood of success on the merits;
• whether the plaintiff is likely to suffer irreparable harm in the absence of a preliminary injunction;
• the balance of equities between the plaintiff and defendant; and
• the public interest.

In trade mark infringement cases, upon a showing of likelihood of success on the merits, the plaintiff is entitled to a rebuttable presumption that irreparable harm is likely in the absence of the injunction. Such presumption may be rebutted by showing the plaintiff unreasonably delayed in seeking relief or by presenting evidence that monetary damages would be a sufficient remedy.

Prior to granting a permanent injunction, the prevailing plaintiff must show:

• that it has suffered an irreparable injury;
• that remedies available at law, such as monetary damages, are inadequate to compensate for that injury;
• that, considering the balance of hardships between the parties, a remedy in equity is warranted; and
• that the permanent injunction serves the public interest.

In trade mark infringement cases, the prevailing plaintiff is entitled to a rebuttable presumption of irreparable injury in the absence of a permanent injunction.

Trade Marks

A prevailing plaintiff in a trade mark infringement case may be entitled to recover actual damages, an accounting of the defendant’s profits, statutory damages, and/or enhanced damages.

Actual damages

Actual damages include the defendant’s profits attributable to the infringement, lost sales or other direct harm to the plaintiff, and the costs of the lawsuit.

Defendant’s profits

To calculate the defendant’s profits, once the plaintiff offers evidence of the value of the defendant’s sales, the burden shifts to the defendant to prove any proportion of the total profits that may not be attributable to the infringement. A showing of wilful infringement is not required to recover the defendant’s profits. However, such a showing of wilfulness will increase the likelihood of the court awarding profits.

Statutory damages

In cases involving counterfeit goods, the plaintiff may elect statutory damages in lieu of actual damages (see 8.12 Counterfeiting and Bootlegging (Trade Mark Counterfeiting)).

Enhanced damages

If there is a finding that the infringement was intentional, the plaintiff may be entitled to enhanced damages, including up to three times actual damages (treble damages) and increased statutory damages in cases involving counterfeit marks.

Copyrights

Under Section 504 of the Copyright Act, an infringer is liable for either:

• the copyright owner’s actual damages and the infringer’s profits; or
• statutory damages.

Actual damages and profits

Actual damages refer to the damages suffered by the copyright owner as a result of the infringement. Actual profits are those profits of the infringer that are attributable to the infringement and have not already been taken into account when computing the actual damages. To calculate the infringer’s profits, the copyright owner presents proof of the infringer’s gross revenue and the burden shifts to the infringer to prove any proportion of the total profits that may not be attributable to the infringement.

Statutory damages

A copyright owner may, at any time before final judgment is rendered, elect to recover statutory damages in lieu of actual damages and profits. Statutory damages range from a minimum of USD750 per work infringed to a maximum of USD30,000 per work infringed.

In cases of wilful infringement, statutory damages may be increased at the discretion of the court to a sum of not more than USD150,000 per work infringed.

Where an infringer can successfully prove the innocent infringer defence (eg, that the infringer was unaware of the infringing nature of their conduct), the court may reduce the statutory damages award to no less than USD200 per work infringed. A finding that the infringer reasonably believed the use to be fair use will protect limited classes of infringers against statutory damages, including employees or agents of non-profit educational institutions, libraries or archives.

Under both trade mark and copyright law, certain statutes provide for the shift of a prevailing party’s fees and costs to the non-prevailing party (15 USC Section 1117(a); 17 USC Section 505). Rarely is such an award mandatory and district courts have the discretion to determine whether fees should be awarded based on various factors, including:

• futility of the non-prevailing party’s claims or defences;
• whether an award furthers the prevailing party’s need for compensation;
• deterrence to the non-prevailing party; and
• the non-prevailing party’s motivation.

In trade mark cases, courts have begun applying the standards applied by the US Supreme Court in patent cases to determine whether a case is “exceptional” as required by 15 USC Section 1117(a) such that an award of attorney’s fees is appropriate. Specifically, the court considers the totality of the circumstances to determine if the case is “one that stands out from others with respect to the substantive strength of a party’s litigation position (considering both the governing law and facts of the case) or the unreasonable manner in which the case was litigated” (Octane Fitness, LLC v ICON Health & Fitness, Inc, 572 US 545 (2014)).

An award of attorney’s fees is mandatory in cases involving counterfeit goods if it is proven that the counterfeiting was intentional, unless there are extenuating circumstances.

Attorney’s fees and costs may also be awarded as a sanction under Federal Rule of Civil Procedure 11, if the court finds that “any attorney, law firm, or party” has violated its responsibilities by bringing or maintaining a lawsuit for an “improper purpose” – for example, to harass, to cause unnecessary delay, or to needlessly increase litigation costs. Sanctions may also be warranted if a party brings a frivolous action or makes baseless factual contentions in court filings.

Ex parte refers to the court hearing a request for relief without notice to, or participation by, the opposing party. Such relief may be necessary when seeking a temporary injunction, seizure order, and/or expedited discovery. However, ex parte orders are rarely appropriate and tend to be limited to situations where the disappearance or destruction of evidence is likely, such as in cases involving trade mark counterfeiting.

US Customs and Border Patrol (CBP) allows trade mark and copyright owners to record registrations to aid in the prevention of the importation of counterfeit or infringing goods. The CBP has the authority to detain, seize, forfeit and destroy such goods.

Trade mark and copyright registrations can be recorded online at the CBP’s website via an electronic application and payment of the requisite fee.

Whether to settle a case is within the parties’ discretion and a case may be settled at any time. In federal courts, the parties are required to engage in a conference at the outset of the case (before any discovery is conducted) in order to discuss a variety of topics, including the possibility of settlement. In both federal and state courts, it is likely the judge will actively encourage the parties to at least attempt to settle the dispute. Some courts will set a date in the pre-trial scheduling order by which the parties must have met and conferred regarding potential settlement.

Parties can request formal settlement conferences with magistrate judges or appointed pro tem judges, depending on the court. Parties may also voluntarily agree to participate in private mediation in order to try to settle.

Alternative dispute resolution (ADR) is generally not mandatory – although it is highly encouraged by courts as an efficient and cost-effective means by which to resolve disputes. Many courts require the parties in civil cases to engage in formal settlement discussions and encourage the use of judges or private mediators to assist the parties’ settlement negotiations. Some courts also have panels of practitioners who may be utilised by the parties to assist with mediation.

Additionally, the parties may agree to engage in arbitration or mediation (binding or non-binding). There are several organistions that offer arbitration and mediation services, many of which have specialised panels to handle IP-related issues. Some examples include:

• the American Intellectual Property Law Association;
• the International Trademark Association;
• the American Arbitration Association; and
• JAMS.

It is not uncommon for parties to end up with two concurrent proceedings filed regarding an infringement action. This happens when the trade mark or copyright owner files an infringement action in one jurisdiction, while the alleged infringer files a declaratory action for non-infringement in another. Generally, courts will apply the “first to file” rule unless it determines that the earlier filed action was an improper, anticipatory lawsuit. Accordingly, the second court may either dismiss or stay its proceedings pending the resolution of the earlier filed suit or it may transfer the case to the other court if that court would have jurisdiction over the claims and parties.

Appellate procedures for trade mark and copyright cases mirror any other federal case. See 8.7 Lawsuit Procedure for further details.

Generally, issues before the court may not be appealed until there is a final ruling. A notable exception is a ruling on a preliminary injunction, which may be appealed immediately. Appeals must be filed within 30 days from the entry of final judgment, with some limited exceptions.

Appeals in the federal courts are governed by the Federal Rules of Appellate Procedure and applicable local and court rules.

There are no special appellate rules specific to trade mark or copyright cases.

On appeal, both legal and factual issues may be raised. Factual findings are reviewed under the “clear error” standard. Legal conclusions are reviewed de novo (without any deference to the trial court’s legal rulings).

Trade Marks and the Rights of Publicity 

Rights of publicity protect an individual’s name, likeness and persona from unauthorised commercial use. Such rights are governed by state law. There is minimal overlap between trade marks and the right of publicity – namely, if a person’s name or image serves as a trade mark, it may then be protected as both a trade mark and a publicity right.

Copyrights and the Rights of Publicity 

Copyrights and the rights of publicity are distinct interests. Copyrights protect the copyright owner’s rights in the work or intellectual creation, while publicity rights protect the interests of the person(s) who may be the subject of the work or intellectual creation.

Unfair competition claims allow for businesses and business owners to recover damages that result from unfair, fraudulent or deceptive business practices.

Claims for unfair competition are available under federal statutory law (15 USC Section 1125(a)), federal common law, and state common law (see 8.2 Legal Claims for Infringement Lawsuits and Their Standards (Trade Mark Infringement – Available Claims)).

Trade Marks

Free speech/parody

The intersection between trade mark rights and free speech rights as protected by the First Amendment has been a continuous development. In a significant decision, the Supreme Court ruled that infringers cannot hide behind the First Amendment’s protection for parodies when such infringing use is for commercial or pecuniary gain. Generally, a parody is an imitation of another done for comic relief or to ridicule. Parody has long been a defence available against trade mark infringement. The Supreme Court’s decision in Jack Daniel’s Props Inc v VIP Prods, LLC, 143 S Ct 1578, 1585 (2023) significantly narrows the availability of this defence by holding it is inapplicable when the alleged infringing use is commercial in nature – see the US Trends and Developments chapter in this guide for further discussion.

Copyrights

Generative AI

Whether a work created by or with the assistance of AI is copyrightable is part of an evolving landscape. In March 2023, the Copyright Office announced its first formal guidance on this issue, stating that works created with the assistance of AI may be copyrightable if the work involves sufficient human authorship. However, the parts of the work created by AI must be identified and disclaimed.

In August 2023, the Copyright Office announced it is conducting a study regarding copyright issues raised by generative AI and published a notice of inquiry for public comment. The Copyright Office intends to use the information and comments to analyse whether changes are needed to the law and to evaluate potential areas for congressional action.

See 10.4 Intermediaries.

There are no other special rules or norms regarding trade marks or copyrights as used in business.