This article is devoted to the specifics of the international registration system based on the Madrid Protocol when utilized for obtaining trademark protection in the United States Patent and Trademark Office (US PTO).
The United States joined the Madrid Protocol (The Protocol) governing the International Protection of Trademarks in August 2003 and started its implementation in November of the same year. The United States accession to the Madrid Protocol was a long anticipated event, met with great enthusiasm among the other members of the international registration system trademark regulated by The Protocol.
The Protocol offered a cost effective and efficient way for trademark owners – individuals and companies – to ensure the protection of their marks in multiple countries by filing a single application with one office, in one language, with one set of fees in the same currency.
The Madrid Protocol also proffered simplified way to manage and maintain already internationally registered trademarks through one procedural step for recording subsequent transfers of the ownership, or changes in the name or address of the holder at the International Bureau of the World Intellectual Property Organization (International Bureau of The World Intellectual Property Organization – WIPO), filing renewals etc. The Madrid Protocol was regarded by the legal practitioners as a powerful tool for offering their clients international trademark protection at more competitive prices.
While, these advantages should not be underestimated, there are certain key questions that foreign trademark attorneys need to discuss with their clients before applying for trademark protection in the United States on the basis of an international registration.
There are two main limitations of the Madrid Protocol that apply in all cases, not just in relation to the United States, and should always be discussed when the international registration system is at issue.
“Central Attack”
The first weak point is the so called “central attack,” meaning that the international registration depends on the basic application or registration for the first five years of the issuance of the International Registration. If the basic mark is cancelled or abandoned by its owner, the international registration will also be cancelled, along with any protection claimed in other countries. Each of these canceled local applications can be transformed into a national one, but only at a considerable price and efforts.
Limitations on the Transfer of the Mark
The second weakness is that ownership of the mark along with its international registration cannot be transferred to an individual or entity not domiciled in a member state of the Madrid Protocol. For example, if the holder of an international registration decides to assign the mark and sell the underlying business to a legal entity or an individual from Canada, which is not a member state of the Madrid Protocol, it cannot be done. The way around this limitation is by pulling the mark out of the international registration system, which is also associated with significant costs and endeavor.
The following restrictions apply only to extensions of international registrations to the United States.
Unavailability of the Supplemental Register for Merely Descriptive Marks
In the US PTO there are two registers that provide protection for trademarks – Principal and Supplemental Register. When the mark, for which protection is sought, is of the category of merely descriptive marks it cannot be registered on the Principal Register, unless it has acquired a secondary meaning as a trademark. Where this is not possible, The Lanham Act provides for the existence of a Supplemental Register. The Supplemental Register is the place where descriptive marks are registered, without the need to show secondary meaning.
There are significant differences between the two registers, such as: (1) While registration on the Principal Register is a prima facie evidence of the exclusive right of the owner to use the mark, registration on the Supplemental Register does not provide such benefit; (2)The existence of registration on the Principal Register invalidates the bona fide defense to third parties’ infringing uses, while the Supplemental Register has no such effect; (3) Registration on the Principal Register may become incontestable after five years of use of the mark in commerce, while the Supplemental Register does not offer such a benefit; (4) Unlike the Principal Register, registration of the Supplemental Register cannot be used to stop the import of counterfeits in the United States.
Nevertheless, the Supplemental Register has also a number of advantages, which should not be disregarded: (1) The owner of a registration on the Supplemental Register may bring an infringement lawsuit in federal court, together with a claim for unfair competition; (2) The owner of a registration on the Supplemental Register is entitled to use the symbol “®”, which is a proof of federal protection for the brand; (3) The Supplemental Register provides additional protection for so-called “merely descriptive marks” when they have not acquired secondary meaning and, therefore, cannot be registered on the Principal Register; (4) Mark on the Supplemental Register is not published in the Trademarks Official Gazette and, once accepted, it registers immediately. This can help the brand to remain “unnoticed” until the moment it begins to acquire “secondary meaning,“ which, in turn, is a prerequisite for registration of the principal register; (5) A trademark that is registered on the Supplemental Register for five years has greater chances to be accepted on the Principal Register as a mark acquired secondary meaning, without the need to provide strong evidence in support thereof; (6) A trademark examiner may cite the mark against future applications of confusingly similar marks for registration on either register; (7) Finally, registration on the Supplemental Register establishes mark’s priority over other, later filed, marks by officially recording the date of first use.
Marks that have been filed under the Madrid Protocol, however, are not allowed for registration on the Supplemental Register. Therefore, if such mark is held to be merely descriptive by the trademark examiner, it is not possible to move it to the Supplemental Register and the application will be abandoned. The only way to ensure protection of such marks is filing a national application for registration directly with the US PTO. But this, of course, involves additional fees (government and legal) and loss of the priority date from the Madrid Protocol filing.
The next three points apply to the class and description of the goods and services within a U.S. application for registration under the Madrid Protocol. Foreign attorneys already know that the US PTO requirements concerning the description of goods and services are stricter than those in foreign IP offices. The US PTO, however, applies much more relaxed standard for amendments to the goods and services in a national trademark application for registration, then in those based on Section 66(a) under the Madrid Protocol.
Inability to Change the International Class Number
The first limitation is that the International Class enumeration cannot be changed in applications filed under the Madrid Protocol. For example, if an application filed under the Madrid Protocol contains “art paints,“ listed in International Class 002, the US PTO will reject the description, as the goods are properly classified in International Class 016. In such case, the only possible action is to remove class 002 from the application or, if it is the only class, the application to be abandoned in its entirety.
Inability to Move Goods between International Classes
For direct applications in the US PTO, it is permissible goods and/or services to be moved between classes to achieve correct classification. This means that all the goods, which are covered by the language of the original application, may be placed within each class, which is part of the original application. For example, if the application contains “industrial and art paints” in International Class 002 and “artist materials” in International Class 016, the US PTO will allow the wording “art paints” to be moved from class 002 to the appropriate class 016. In the case of an application filed under the Madrid Protocol, such action is not permitted. In the above example, “art paints” will have to be deleted from the application because these goods are not properly listed in International Class 002 and they cannot be moved from one class to another.
Inability to Add International Classes
Within a direct application for registration, when the listed goods and/or services exceed the international class in which they were originally filed, the US PTO allows new classes to be added to the application for an additional fee, so that the goods and/or services are properly classified. This is useful in at least two instances. First, when the application for registration covers many items, some of which exceed the scope of the International Classes designated in the original application, the trademark examiner will advise that new class(es) may be added, instead of deleting the excessive goods or services. Second, when the owner of the mark wishes to defer payment of certain government fees, goods and/or services may be listed in fewer classes when the application for registration is filed. The examiner, then, will issue a letter (Office Action), which will spell out the classes that need to be supplemented. The applicant can pay an additional fee for each new class in the application for registration or to delete all unnecessary goods and services. Thus, the payment of the majority of government fees may be delayed for more than nine months after the date of filing.
This option is not available for applications based on an international registration under the Madrid Protocol.
Inability to Add Additional Bases for Obtaining Registration
A national application for trademark/service mark registration directly submitted to the US PTO may claim different filing bases, such as, actual use under Section 1(a) of the Lanham Act, intent-to-use under Section 1(b), foreign application and registration under Sections 44(d) and 44 (e) where the Section 44(d) basis entitles the applicant only to a claim of priority but not to a registration. These filing bases may be changed or, in some cases, even combined. Under the Madrid Protocol, however, there is only one possible basis for obtaining a trademark/service mark registration. This is the Section 66 (a) basis, which may not be substituted by or combined with other filing bases. Therefore, an application filed in the US PTO under the Madrid Protocol, cannot be based on use in commerce, which in turn, leads to a weaker registration.
Weakness of Registrations Obtained under the Madrid Protocol in Legal Disputes
In the United States, trademark rights arise from use of the mark in commerce. However, there is an exception for applications filed under the Madrid Protocol or based on foreign registration under the Paris Convention for the Protection of Industrial Property. These exceptions allow for the registration of marks, without proof that the brands are used in commerce. This is considered as one of the biggest advantages of using the Madrid Protocol in the United States. On the other hand, registrations obtained without filing a proof of use are in a very unfavorable position during litigation compared to marks, for which registration was obtained as a result of their use in commerce.
Inability to Change the Mark
Once a mark is registered in the International Bureau of WIPO, the mark may not be changed.
US PTO, however, allows “immaterial” changes to a mark subject of a national application for registration. “Immaterial” changes to the mark are allowed not only during the examination process but also after the registration has issued under Section 7 of the Trademark Act. Thus, if the owner of the mark in a national application, based on Sections 1(a) or 1(b), makes small immaterial changes to it after submission of the initial application, it will still be accepted by the US PTO. This is not the case, however, with brands that have as its basis international or foreign registration.
Risk of Missed Deadlines
International registration can be renewed every 10 years by filing a single form with and paying the appropriate fee to the International Bureau of WIPO. This step ensures the renewal of the registration of the mark in all countries covered by the international registration. In the United States, however, maintenance of registered trademarks, including those, for which registration is available under the Madrid Protocol, is different. In particular, between the fifth and sixth year of the date of registration in the United States, must be filed an affidavit in support of the assertion that the mark is used in commerce (Section 71 Affidavit of Use). Such declaration must also be filed between the ninth and the tenth year from the date of registration in the US PTO, and every ten years thereafter. The fact that in the United States all terms depend on the date of the registration in the US PTO often threatens to skip these deadlines, especially if an American lawyer was not involved in the registration process. All foreign attorneys need to be mindful of the fact that, even if the international registration is renewed, but Section 71 Affidavit of Use is not filed on time, the U.S. registration will be canceled.
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A cursory look at the statistics published on the website of the US PTO gives a general idea of the fate of the applications for registration under the Madrid Protocol in comparison with the direct applications for registration. As seen from the charts for 2013, the number of Section 66(a) applications that matured to registration is only 32,775, almost six times less than the direct applications submitted through the TEAS registration system, and three times less than the applications received by the TEAS Plus electronic form (both forms relate to national applications for registration submitted directly to US PTO). Moreover, if we compare the number of national applications for registration that have been approved for registration without issuing any official actions to those submitted through the Madrid Protocol, we will see that the number of the latter is negligible. This inevitably shows that often applications filed under The Protocol prove to be ineffective in terms of their successful registration.
In summary, the Madrid Protocol is a powerful instrument to reduce costs and facilitate the management of the international trademark portfolio for brand owners. But when the focus is obtaining a trademark protection in the United States, the abovementioned factors should be seriously taken into account in order to secure smooth and effective registration process.
Author:
Milena S. Mishev
Partner
McCarthy Fingar, LLP
Ms. Mishev may be contacted at: moc.ragniFyhtraccMnull@vehsimm
