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Foreign Applicants for United States Tradermarks Must (NOW) Use U.S. Licensed Attorneys: Is China to Blame?
Monday, July 22, 2019 15:53
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Flood of illegimate Chinese trademark filings forces USPTO rule change
Last week, the United States Patent and Trademark Office (USPTO) announced that as of August 3, 2019, all foreign-domiciled trademark applicants, registrants, and parties to Trademark Trial and Appeal Board (TTAB) proceedings must be represented by an attorney who is licensed to practice in the United States. This will apply to all trademark applicants, registrants, and parties whose permanent legal residence or principal place of business is outside the United States. These parties must all have a U.S.-licensed attorney representing them in all USPTO trademark matters.
In addition, the USPTO will require that all U.S.-licensed attorneys who represent anyone before the USPTO in trademark matters must provide their State bar membership information and confirm they are an active member in good standing of that bar.
According to the director of the USPTO, Andrei Iancu, “Businesses rely on the U.S. trademark register to make important legal decisions about their brands. In order to maintain the accuracy and integrity of the register, for the benefit of all its users, the USPTO must have the appropriate tools to enforce compliance by all applicants and registrants. This rule is a significant step in combatting fraudulent submissions.”
This new rule requiring a U.S.-licensed attorney in all trademark matters will likely streamline the trademark prosecution process and ensure trademark applicants are represented by a party familiar with United States trademark law. This new trademark rule is also expected to improve the quality of trademark application submissions. This rule change should come as no surprise to those practicing in the international trademark space, since many other countries require a domestic attorney to represent foreign trademark applicants.
Beginning August 3rd, pursuant to this rule, Canadian patent agents will no longer be authorized to represent Canadian trademark applicants, registrants, or parties before the USPTO in trademark matters. However, Canadian trademark attorneys and agents will (if eligible )continue to be able to represent their Canadian clients, though the USPTO will correspond only with the appointed U.S. licensed attorney.
This change is significant for foreign companies looking to protect their brands with United States trademarks and we recommend you speak with a U.S. licensed trademark attorney to prepare for this transition.
This rule change is widely believed to stem from Chinese companies having abused the United States trademark filing system. In Flood of Trademark Applications from China Alarms U.S. Officials, the Wall Street Journal wrote extensively about how Chinese companies were “flooding” the USPTO with trademark applications “rife with false information”:
Huge numbers of Chinese citizens are seeking trademarks in the U.S., flooding the U.S. Patent and Trademark Office with applications that officials say appear to be rife with false information.
The surge of filings from China has surprised the patent office. Officials say it could be fueled by cash subsidies that Chinese municipal governments are offering to citizens who register a trademark in a foreign country.
Trademark applications from China have grown more than 12-fold since 2013 and for fiscal 2017 totaled thousands more than the combined filings from Canada, Germany and the U.K. About one in every nine trademark applications reviewed by the U.S. agency is China-based, according to government data.
Patent and trademark officials say cash incentives could be a factor. As part of a national effort to ramp up intellectual-property ownership, China’s provincial governments are paying citizens hundreds of dollars in Chinese currency for each trademark registered in the U.S.
Many Chinese applicants list addresses in the southeastern city of Shenzhen, often referred to as the Silicon Valley of China. Shenzhen pays companies and individuals as much as roughly $800 for a U.S. registered trademark, according to the city’s intellectual-property bureau.
The U.S. officials say many China filings show a pattern of suspicious claims about the goods in question and the qualifications of the attorneys handling them.
“There’s been a dramatic increase in Chinese filings. A lot of [them] seem to be not legitimate,” the patent office’s trademarks commissioner, Mary Boney Denison, said at a Trademark Public Advisory Committee meeting last fall, according to a transcript.
The WSJ article goes on to discuss how fraudulent trademark filings by Chinese companies are delaying legitimate trademark filers trying to secure trademarks with names are similar those sought or secured fraudulently from China.
To qualify for a United States trademark, the product or service for which the U.S. trademark is being sought must be “used in commerce.” But unless another company is challenging the trademark, very little evidence is needed to support the “in use” claim. “There have been instances when a screenshot of a listing on Amazon or another e-commerce site is all an applicant needed to demonstrate market activity.”
Chinese companies essentially flat out lie about having used a particular brand name in commerce in the United States. “The Patent and Trademark Office has found numerous instances of Chinese applicants asserting that a proposed trademark is used in commerce, while submitting multiple nearly-identical images of the same consumer product with a different word on the brand tag. FORLISEA, CINYIFAAN, ENJOYSWEETY and GOOKET are some of the two dozen Chinese brands shown on an identically designed pair of zebra-print pants, for example.”
According to the Wall Street Journal, a number of the Chinese companies that falsely claimed to have been using their brand name in U.S. commerce were represented by foreign attorneys not licensed to practice law in the U.S., “In one recent application, a Shenzhen address was listed for an attorney representing a Hong Kong client who had digitally altered a photo to insert the word “Instamarket” over a Walmart storefront” and “more than a dozen Chinese applicants entered the name “Wendy” into the entry box for the attorney name on the trademark application.”
Many months ago, the World Intellectual Property Review, quoted a leading U.S. trademark attorney as saying, “If it weren’t politically taboo, there could be a section header in the rule change that reads ‘The USPTO is seeking to curtail problematic Chinese filings’.”
Come August 3, that rule change will be here.
We will be discussing the practical aspects of Chinese law and how it impacts business there. We will be telling you what works and what does not and what you as a businessperson can do to use the law to your advantage. Our aim is to assist businesses already in China or planning to go into China, not to break new ground in legal theory or policy.
