- Background
So you or your company have met the requirements for receiving a registered trademark or patent from the United States Patent and Trademark Office (USPTO). Your efforts to obtain these valuable intellectual property rights (especially for the patent) involved considerable costs ranging from legal fees to filing fees charged by the USPTO and maybe even an appeal. Does your success in obtaining a registered trademark or a patent mean that your “interaction” with the USPTO is now over and done with? Not if you wish to retain your trademark registration and patent rights!
Both registered trademark rights and patents require the payment of maintenance fees to the USPTO to maintain their “active” status. Additionally, the owner of registered trademarks must also establish periodically that the mark is still in use to enjoy the benefits of registration. Patents, on the other hand, need never be practiced to enjoy continuing patent rights during the effective patent term providing the maintenance fees are timely paid.
Unfortunately, many patent and registered trademark owners are not aware of the ramifications of failing to pay maintenance fees until it’s too late. This article summarizes important information related to maintaining the active status of registered trademarks and issued patents.
- Maintenance of Registered Trademarks
The USPTO is required to strictly comply with the federal statute governing registered trademark maintenance fees. Failure to timely pay the maintenance fees will result in administrative cancellation of the mark by the USPTO. These fees are due within the 5th and 6th years of registration, the 9th and 10th years of registration and every 10th year thereafter. Once cancelled as the result of non-payment of the required maintenance fee, the only way to again acquire registration rights in that mark is to file another trademark application and go through the prosecution process again.
This new trademark prosecution process may not necessarily result in registration of the mark that had been cancelled. This commentator encountered such a scenario with a client who had inadvertently failed to pay the maintenance fee by the 6th year of registration on a valuable registration originally obtained by the client. The commentator was retained to file a new application for the cancelled mark. The new examining attorney initially refused registration of the mark as being merely descriptive despite the fact that the same mark had once been registered. The commentator was able to obtain registration of the mark on distinctiveness grounds.
Proving distinctiveness to the satisfaction of the USPTO is no easy task as the case law demonstrates and can be a very costly endeavor because of the legal fees. The commentator’s client would have appealed any final rejection by the examining attorney to the Trademark Trial and Appeal Board (TTAB) because of the value of mark. Appeals are expensive and time-consuming. Additionally, statistics available for TTAB decisions show that examining attorneys’ rejections are affirmed more often than not. Hence another reason for ensuring that trademark registration fees are timely paid to prevent a situation where a new examining attorney may conclude that the “re-filed” mark does not qualify for registration.
In addition to paying the maintenance fee, the mark owner must file documentation with the maintenance fees declaring that the mark is still in use and provide specimens proving as such. As long as the declaration and specimens are filed according to the above specified schedule and the declaration/specimens meet the requirements USPTO’s requirements, the registered trademark will remain in effect with three exceptions: (1) it becomes cancelled as the result of a cancellation proceeding filed with the TTAB by a third party; (2) it becomes cancelled as the result of a trademark infringement lawsuit in federal court wherein the court issues an order directing the USPTO to cancel the mark; or (3) it is voluntarily cancelled by the registrant, the mark’s current owner, or the registrant/owner’s legal representative. See 37 U.S.C. § 1904.07(a).
Registered trademarks that end up being cancelled by the USPTO for any statutory reason will be designated as cancelled in the records of the USPTO. Registered trademarks may also be cancelled by a federal court to which a party (petitioner or registrant) in a TTAB cancellation proceeding has appealed the TTAB’s cancellation decision.
The actual trademark registration maintenance fees due are dependent upon the number of international classes designated for the registered trademark. If the trademark owner is no longer using the mark with one more of the designated classes in a multi-international class registration, then the declaration should indicate as such and request deletion of the “inactive” classes of goods/services. The payment due is based on the number of “remaining” classes and the registrant must provide specimens showing how the mark is still being used with the “remaining” classes.
A registered mark may remain in effect indefinitely providing declarations/fees are timely submitted to the USPTO and accepted and assuming that the registered mark is not cancelled as the result of one of the above three specified scenarios. That is, there is no statutory “cut-off” period for enjoying registered mark status.
- Maintenance of Patents
Maintenance fees on utility patents in the United States are due 3½, 7½ and 11½ years after grant of the utility patent. In contrast to many other countries, no maintenance fees are due while a US patent application is pending. Maintenance fees are not required for design patents and plant patents.
Patents have a defined lifetime generally equal to twenty (20) years from the application’s filing date; the actual expiration date is determined under the patent term extension statute where the 20 year date may be adjusted to a later or earlier date according to the patent’s prosecution history. Patents therefore have a cut-in-stone expiration date while registered trademarks may last indefinitely.
Patent maintenance fees may not be paid in advance; the patentee must wait until the payment window opens six months before the due date before paying a maintenance fee. At the end of the half-year window during which a maintenance fee may be paid, a six-month grace period begins during which a patentee may still pay the maintenance fee along with a small surcharge. The maintenance fees are determined on the basis of the patentee’s designated status: large entity, small entity, or micro entity. This status must be reasserted with the payment of each maintenance fee.
If the maintenance fee has not been paid at the conclusion of the grace period, the patent expires for non-payment of maintenance fees. In contrast to trademark registrations for which the declaration/maintenance fee was not timely filed, a patentee may file a petition indicating that the non-payment was unintentional. This petition must be timely filed and there is no guarantee that the petition will be granted and the expired patent reinstated.
Patent claims may be invalidated as the result of proceedings involving the USPTO’s Patent Trial & Appeal Board (PTAB) (see 35 U.S.C. § 311) or by federal court order resulting from: (1) a patent infringement case wherein the alleged infringer successfully argues that at least some of the patent claims should be invalidated; or (2) an appeal of a PTAB decision to the court. As long as an issued patent has claims that are not invalidated as the result of proceedings before the PTAB or a federal court, maintenance fees will be due.
- Assignment of Registered Trademarks and Patents
The assignee of any registered trademark or patent rights will generally assume the responsibility of paying any future maintenance fees as the mark owner and filing the required declaration/specimens. Any assignment document should always specify which party has the obligation to pay the maintenance fees. Assignees should always ensure that any assigned trademark registration or patent is full effect and that the assignor is indeed the legal owner of an “active” trademark registration or patent. Recordation of any trademark or patent assignment with the USPTO is highly recommended. Licensors of trademarks and patents are generally responsible for paying the maintenance fees, but any licensing agreement should nevertheless clearly state who has the obligation to do so. The licensor remains the owner of the registered mark or patent.
- Ensuring that Valuable Registered Trademark and Patent Rights Are Not Lost for Failure to Maintain
Large companies generally have procedures in place for monitoring the status of their trademark and/or patent intellectual property. The in-house legal team, if any, is generally involved in monitoring the “active” status of the company’s IP.
Startups and small companies, on the other hand, often do not have a formal mechanism in place for ensuring that the future required maintenance fee dates are adhered to. Furthermore, these time periods occur over a period of many years and can easily be “forgotten.” It is thus highly recommended that any entity owner of any registered trademark and/or patent adopt a procedure for annually reviewing the status of its intellectual property by designated managers/officers to ensure that maintenance dates are kept on the radar. Additionally, a department and/or employee should be assigned the responsibility of ensuring compliance with registered trademark and patent maintenance fee/document filing requirements by the due date. Payments/filings are preferably made “earlier” rather than “later.” Proof of payment/document filings should be maintained with the other records associated with the corresponding patent or registered trademark.
For registered trademarks, either in-house counsel or outside counsel should be consulted if there are any questions concerning the declaration/specimen documents that will need to be filed with the USPTO to ensure that the registration status will remain in effect. The USPTO will reject declarations that do not meet statutory requirements, including establishing that the declaration filer is the owner of the registered mark.
- A Brief Comment on Copyright and Trade Secret Lifetimes
Although not discussed above, registered copyrights enjoy decades of protection under the copyright statute and maintenance fees are not required. Trade secret protection can last for decades or far beyond the lifetime a patent providing, of course, that the trade secret remains just that – secret. The best example of a long-time trade secret is the formulation for Coca Cola.
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The foregoing is not legal advice but is provided for information only. Contact the office to receive a complimentary checklist for monitoring the status of your valuable IP at [email protected]. The commentator is available to assist clients in obtaining and maintaining intellectual property rights protection as well as protecting their valuable intellectual property from the unauthorized use by others at a predictable, reasonable legal fee.
© Troy & Schwartz, LLC 2019
Where Legal Meets Entrepreneurship™
