The Trademark Modernization Act of 2020

On December 21, 2020, Congress passed the Consolidated Appropriations Act, 2021, a $2.3 trillion spending bill, which former President Trump signed into law on December 27, 2020.  While the primary focus of the Appropriations Act was the $900 billion in stimulus relief for the COVID-19 pandemic, notable trademark legislation was also included in the relief bill.  The Trademark Modernization Act of 2020 (the “Act”) was passed as part of the Appropriations Act, and impacts various aspects of the trademark process as the United States Patent and Trademark Office (the “USPTO”).   The Act achieves these changes via amendment to the Lanham Act, which is the primary federal trademark law.  These amendments from the Lanham Act range from the more administrative to creating new rights and defined standards under the law, including the following:

• Shortened Response Deadlines. Presently in response to office action communications from the USPTO, trademark applicants have six months to respond to the USPTO.  The Act allows a shortened response deadline, with as few as 60 days permitted to respond, however, this deadline must be extendable for up to six months.  The Director may set the extendable time periods and fees associated with these extensions.  This is very similar to the response deadline concept on the patent side of the USPTO, where office action communications have shortened response deadlines that are extendable by one month periods, where each additional month includes a fee that balloons as additional months are added to the extension.
• Ex Parte Expungement; Cancellation.  The Act provides a new procedure for expungement of a mark, as well as a new ground for cancellation, for marks that have never been used in commerce on or in connection with some or all of the goods or services recited in the registration. An expungement proceeding may be instituted at any time following the expiration of three years after the date of registration and before the expiration of 10 years following the date of registration.  And cancellation on these grounds may be instituted at any time after the three-year period following the date of registration. 
• Ex Parte Reexamination.  This procedure is instituted by a third party when a mark was not used in commerce either at the time of registration for marks filed on an actual use basis, or at the time an amendment to allege use is filed for marks filed on an intent-to-use basis. Reexam must be brought within five years after the mark registers, and according to initial guidance from the USPTO, should generally be used for “registrations where a questionable specimen showing use in commerce of the trademark was submitted during examination.” This procedure, in connection with Ex Parte Expungement and Cancellation is aimed at providing additional grounds for parties to challenge improperly (and at times fraudulently) registered trademarks.
• Rebuttable Standard Presumption.  The Act sets for the standard required for a plaintiff to succeed on a temporary restraining order or permanent injunction, which alleviates previous ambiguity in this standard due to a court circuit split.  The standard provides that a plaintiff has a rebuttable presumption of irreparable harm upon a finding of trademark infringement or upon a finding of likelihood of success on the merits of infringement in the case of a motion for a preliminary injunction or temporary restraining order.  This standard will be more favorable to plaintiffs enforcing their trademark rights.

The provisions of the Act will be implemented by December 27, 2021, and we will keep you updated on additional substantive updates as the Act is implemented.