Here at Ward Trade Marks we are delighted to introduce a guest blog by Susan Colman, an attorney in Washington, DC. Susan’s practice includes trademark and copyright law, software protection, licensing and some IT law.
Since the Madrid Protocol came into force some 25 years ago, many companies outside the United States have taken advantage of the apparent cost advantages there are in filing trademark applications in member countries for much less money in fees and costs than would otherwise occur if those applications were filed country-by-country.
There’s certainly nothing wrong with that.
But, particularly in regard to choosing the United States as a designated country, if something seems too good to be true, this is one of those things.
Indeed, each country has its own set of laws and regulations when it comes to protecting trademarks on a national level and these laws and regs can seriously trip you up in the U.S. if you designate this country under Madrid rather than filing nationally. Thus, any cost savings you would obtain by making a Madrid filing in the U.S. will evaporate into thin air.
The Disadvantages of a Madrid Application compared to a U.S. National Application
It is necessary to pay heed to the down sides of using Madrid when designating the United States:
Drafting an identification of goods that works
In the U.S., care must be taken in describing goods and services, particularly after a comprehensive search has been done that raises potential infringement issues (by your company or to your company). You will need to be able to draft an identification of goods and/or services that will properly distinguish your goods/services from those that either the Examining Attorney will flag or during the opposition period once the mark is published.
Pretending that the identification of goods/services in your country under your laws and regulations would pass muster in the U.S. because they would be acceptable in your own country, may very well doom your application in the U.S.
Thus, if the U.S. application is refused, a new national U.S. application must be filed, and you must start over again. It will cost your business another set of filing fees, which is exactly what you wanted to avoid in the first place.
Madrid Applications cannot be put on the Supplemental Register
In the U.S., a mark can be placed on the less-preferred Supplemental Register when the mark is designated as “merely descriptive” and the mark has not yet acquired secondary meaning or has otherwise acquired distinctiveness in the relevant marketplace. The Lanham Act (the U.S. trademark law) affords a presumption of distinctiveness after a 5-year period of continuous, substantial use by the owner. At that time, it is imperative that a new application be filed for registration on the much more important and preferred Principal Register, meaning another set of filing fees and attorney’s fees.
However, applications filed under Madrid are not entitled to be put on the Supplemental Register in the United States.
If the mark is found to be “merely descriptive” by the Examining Attorney, a new national U.S. application must be filed, and you must start over again.
Intention to Use Applications and Subsequent Designations
A U.S. national application allows for an “Intent to Use” (ITU) filing, with the understanding that once the application passes through the opposition period unscathed, it must be put into use in interstate commerce in the U.S. within an essentially 3-year period after the Notice of Allowance is issued, and a Statement of Use must be filed within that time period. Otherwise, the mark will be deemed abandoned. Extensions of time must be filed every six months, and a filing fee is charged each time (except for the first one).
It is possible to file an ITU application via Madrid and designate the U.S. However, care must be taken when the U.S. is one of several countries which are designated subsequent to an original Madrid filing.
If a U.S. Madrid application based on ITU is subsequently designated, and the declaration of intention to use the mark is not completed correctly or is missing, and that filing is not correctly remedied in the given time, the subsequent designation as a whole is considered abandoned. In other words, all of the applications for other countries in the same subsequent designation will disappear and you must start over again in this case, as well. There is a refund given of the fees paid, although half the basic fee is deducted.
Lack of Freedom to Transfer the International Registration
An International Registration will not be able to be transferable to an owner who is not an inhabitant in a Madrid member country. While there are countries signing up to be Madrid members, not all of them have yet become members. Do your homework first.
Responding to Office Actions
Don’t forget that there are likely to be some procedural snags along the way in the U.S. – typically raised in Office Actions – that require the assistance of U.S. licensed attorneys to address.
Sometimes, the issues raised in Office Actions are ministerial (i.e., clarification of identification of goods/services or need for a different specimen). But many times, a refusal on the basis of a likelihood of confusion will be raised, which will require a response in the nature of a legal argument against that allegation.
If the Examining Attorney issues a final refusal, you will have the choice of proceeding to the U.S. Trademark Trial and Appeal Board to file an appeal. Alternatively, you will have an opportunity to file an appeal in federal court. Consider at this point that the cost and time consumption in litigation in the United States will elevate to the nosebleed level.
Lack of Freedom Regarding Classification Changes
Designating the U.S. under Madrid means that you will not be able to change Class numbers (there is flexibility, however, if you file a direct national application in the U.S.), nor will you be able to transfer goods/services between Classes if your original classification pertaining to your identification of goods/services might be found to be incorrect.
Moreover, you will not be entitled to add Classes to an application once it is filed. If you think of something else to protect under your mark after the application is filed, you will have to file a new application in the U.S. (this is true even for those in the U.S.).
You need a locally qualified trademark attorney on your side
Finally, there are mandatory maintenance filings in the United States, necessary to retain your registrations. These are in addition to, and independent of, any maintenance filings required for an international Madrid registration. Squandered deadlines have killed many a registration.
It is advisable to have a locally qualified trademark attorney. You’ll need someone in the U.S. to keep tapping you on the shoulder to keep up with the deadlines, rather than doing this yourself. You do not want your U.S. registration to die for failure to maintain it.
The Smartest Decision You Will Make
The moral of this story is this: take as much time as you can at the very beginning to:
- plan with your local trademark attorney regarding your mark, after making a search in all the countries you wish to designate under Madrid,
- get connected with a qualified and licensed trademark attorney in the U.S., where another more comprehensive search on your mark will need to be done in the U.S., and
- make sure you understand all of the consequences of filing under Madrid in designating the U.S. for protection of your mark.
The smartest decision you will make, in light of all the reasons not to include the U.S. as a designated country, is to file a separate, direct, national application in the United States and leave it out of a Madrid filing. You will save a lot of grief and, ultimately, save a lot of money if things were to go wrong otherwise.
Plan in advance and Prepare in advance. You’ll be financially happier if you do.
Susan Colman is an attorney in Washington, DC. Her practice includes trademark and copyright law, software protection and licensing and some IT law. She may be reached via telephone at +202 885 5533 and by email at email@example.com. Ms. Colman is also Of Counsel to Technology Law Group (TLG) (www.tlgdc.com), which litigates in the areas of telecommunications, technology and intellectual property. At TLG, Ms. Colman can be reached via telephone at +202 895 1707 and by email at firstname.lastname@example.org.