Seattle Trademark Lawyer

It’s an innocent mistake. 

You sign your company’s application for trademark registration in your individual name, rather than in the name of your company. Innocuous, right? Yet, if your company is the one that uses the trademark, that mistake could be fatal to your application.

The USPTO clarifies: “If an applicant is not the owner of (or entitled to use) the mark at the time the application is filed, the application is void and cannot be amended to specify the correct party as the applicant, because the applicant did not have a right that could be assigned.” Trademark Manual of Examining Procedure § 803.01, citing 37 C.F.R. § 2.71(d).  

In particular, the USPTO notes that an officer who applies to register his or her organization’s trademark in his or her individual name commits a fatal error in the filing that cannot be corrected:

Non-Correctable Errors. The following are examples of non-correctable errors in identifying the applicant:

(1) President of Corporation Files as Individual. If the president of a corporation is identified as the owner of the mark when in fact the corporation owns the mark, and there is no inconsistency in the original application between the owner name and the entity type (such as a reference to a corporation in the entity section of the application), the application is void as filed because the applicant is not the owner of the mark.

Id. at § 1201.02(c).

So whether you seek an advantage by keeping the trademark in your personal name, or because you don’t know any better, listing yourself as the owner when the trademark is actually owned by your entity can be dangerous. It can render your application void — as well as any registration that later issues.

Timing often doesn’t play a significant role in trademark filings. Because localized rights automatically arise through trademark use, an effort to expand those rights by obtaining a trademark registration is often driven by other factors.

In many cases, that works out fine. But in some, trademark owners should be more strategic — particularly with regard to timing. Here are three situations in which it pays to be smart about when to make trademark filings.  

1. Beat third-party filers. Before alerting third parties about your trademark rights (through a cease-and-desist letter or otherwise), make sure your trademark house is in order. Part of that effort may involve applying to register the trademark. Even if you used your mark first, complaining about a third party’s infringing use may motivate that party to get their trademark house in order, too. If they beat your trademark filing by even a day, their application will be considered first. That risks delaying and even blocking your application, even if you have superior trademark rights. (Less nefariously, the same is true if a third party randomly happens to apply to register the same mark as yours.) Overcoming this obstacle can be a time-consuming and expensive undertaking. It’s so much better to avoid it by filing first.

2. Outsmart cybersquatters. Cybersquatters — people who register domain names on spec and make money selling them to trademark owners — routinely register domain names based on new trademark filings. They know if someone registers a trademark, they already have begun to invest in that brand. Cybersquatters rightly understand that many brand owners will pay a premium to own a domain name reflecting their name, particularly with the .com extension. Don’t let them profit from this logic. Trademark filings are public. Before showing your cards to the world, register your target domain name. Doing so before applying to register your trademark will ensure that your preferred domain name is yours — without delay and without enriching a cybersquatter.

3. Frustrate bad actors abroad. The United States is in the minority when it gives trademark rights to owners automatically through use. In most countries, the only way to get trademark rights is through registration. Like cybersquatters, free riders can take advantage of this norm by registering your brand in their country. Indeed, there’s nothing legally wrong with their doing so. Fortunately, there’s an easy solution: registering your trademark first. Doing so in the countries in which you manufacture and sell can eliminate the irony of infringing the trademark rights of someone who did nothing more than register your trademark first.

The Cup, from www.CascadiaCup.com

This is awesome.

Pacific Northwest soccer fans have been up in arms about Major League Soccer’s recent application to register CASCADIA CUP as a trademark with the Canadian Intellectual Property Office — Canada’s counterpart of the U.S. Patent and Trademark Office.

The Cascadia Cup is awarded to the fans of the team with the most points in a season between the Seattle Sounders, Portland Timbers, and Vancouver Whitecaps — by the fans of those teams. It’s been around since 2004.

So why did the league lay claim to the brand in December when it applied to register the mark in Canada? It’s not theirs to register.

True, the league could be trying to make sure a rogue didn’t claim it, but from the looks of it, the league’s the rogue. As in the States, the first to use a mark in Canada generally has superior rights. Since it’s a trophy by fans, for fans, it’s unclear what business the league has to protect it.

What’s cool is the fans have filed their own application to register the mark in the States. Just last week, the “Cascadia Cup Council,” an Oregon corporation, filed for CASCADIA CUP in Class 41 for “Entertainment services, namely, a contest designed to reward and honor professional soccer teams.” The Council claims a first use date in 2004 — the first year the cup was awarded.

From the Council’s press release:

“The supporters groups in Seattle, Portland and Vancouver jointly oppose Major League Soccer’s claim of ownership of the Cascadia Cup trademark. The three supporters groups have jointly used the Cascadia Cup mark for many years and have been the rightful owners of the mark. In response to recent statements and actions by MLS, the supporters groups recently formed a new entity, the Cascadia Cup Council, which acquired the supporters’ groups trademark rights in the Cascadia Cup mark. The Cascadia Cup Council will ensure that the mark remains in the hands of the very supporters who created it.”

It looks like the Council intends to oppose the league’s application in Canada as well.

Like I said, this is awesome. All I can say is, “Go Sounders!”

HT: Rachel Buker of the China Law Blog.

Plaintiff Ezell’s Fried Chicken, Inc.’s logo

Fellow Seattle IP lawyer Gary Marshall put me onto this.

It’s a struggle over use of the restaurant name “Ezell’s Fried Chicken” between its founder, Ezell Stephens — now separated from the company — and the company’s board. Both parties now sell fried chicken in the Seattle area under the Ezell name.

Gary asks some good questions about who owns a company’s technology. The same questions can be asked about who owns the company’s trademark.

“Founders often neglect to put licenses between themselves and their company in writing. They just assume that the company can use the technology they create. But what happens when they are no longer associated with the company? Can the company continue to use the technology? Can the founder?”

Those are questions the court will have to decide. But as Gary points out, it needn’t be that way.

Decide from the outset who owns the trademark. The founder or the company? Then decide what happens if the company breaks up. Who will own it then?

Just last week I traded emails with a small business owner faced with this very problem. His partnership operated under a single brand. The partnership split up, and the partners are on their own. They now compete against each other offering the same services on the same turf. And both partners continue to operate under the partnership’s brand. Confusing to consumers? You bet.

It raises the same questions the Ezell’s litigants face. Which partner can use the brand? Can either? If one applies to register the mark, can the other object?

Don’t roll the dice with the court. That’s expensive and disruptive. Control your own fate and get these issues hammered out between partners, shareholders, and joint venturers when times are good. It might cost a bit in legal fees up front, but it’ll save you lots more down the road.

So what’s up with the Ezell’s case? The Western District sent it back to King County Superior Court — from which the case had been removed — finding plaintiff’s causes of action sound in state court, the court plaintiff had selected. It also awarded fees, finding the removal had been improper (though it later reduced the amount of the award).

Story on the Ezell’s dispute here.

The case cite is Ezell’s Fried Chicken, Inc. v. Stephens, No. 10-1424 (W.D. Wash.).

The New York Times reported the “Brand Name Auction” raised a bunch of money — over $100k in all. (STL background post here.)

SHEARSON garnered the highest bid at $45,000, followed by MEISTER BRAU at $32,500 and HANDI-WRAP at $30,000.

I’m still not entirely sure what this money bought.

“You’re paying for a license for an interim period till the trademark issues,” NYT quoted one observer.

The Trademark Blog wonders if that means anything for marks that have never been used (after being abandoned) and the intent-to-use applications were signed when the applicants never had a bona fide intent to put the marks to actual use.

Right, the whole swearing-under-oath part of the application.

Notwithstanding that potential hitch, the auction apparently garnered public interest. The auction organizer told the World Trademark Review Blog his firm had 20,000 inquires from interested parties.

Apparently 45% of the inquiries came from private-label manufacturers; 45% came from entities that represent other brand manufacturers; and 10% from investors hoping to license the mark and from domain name owners seeking to marry their domain names with federal trademark registrations.

The organizer, a private investment firm, said the so-called first-ever trademark auction won’t be its last.

“We’ve made a decision to be in this space,” its CEO told the World Trademark Review a week before the auction was held. “Whatever happens at the auction will not deter us from owning this space.”