In a year too often filled with unforeseen developments of every kind, a final surprise for many who were not paying close attention has emerged from December’s marathon stimulus and budget negotiations. This week, Congress included a trio of notable and hotly debated intellectual property measures in its multi-trillion-dollar spending and relief package. These bills, if signed into law as expected, could fundamentally alter the manner in which intellectual property owners protect and enforce their rights.
- The Trademark Modernization Act of 2020, among other technical changes to the Lanham Act:
- Allows third parties to submit evidence to the United States Patent and Trademark Office (USPTO) during the examination phase of an application, under certain circumstances, to encourage the USPTO to refuse registration on the ground that claims of use in the application are inaccurate;
- Allows third parties to submit evidence in so-called ex parte re-examination and expungement proceedings, seeking to cancel registrations (in whole or in part) for non-use; and
- Provides plaintiffs seeking an injunction under the Lanham Act with a statutory rebuttable presumption of irreparable harm, thus significantly lessening the evidentiary burden. When considered in light of the spread of prevailing party fee shifting awards in Lanham Act cases, and the potential for greater access to profit awards due to the Supreme Court’s recent Romag decision, Lanham Act plaintiffs may be more encouraged to litigate their claims.
- The CASE Act creates a voluntary, quasi-judicial tribunal that would resolve copyright infringement claims outside of federal court where the rights owner seeks $30,000 or less in damages — $15,000 per work, $30,000 per matter, with each party to pay their own attorney fees. Supporters argue that the Act will make it easier for independent artists to enforce their rights and combat piracy, while critics fear that it could be weaponized by copyright trolls looking to extract settlement dollars from unsophisticated targets for commonplace online behavior.
- New language criminalizes the operation of a website that is “primarily” engaged in streaming unlicensed or pirated copyrighted works, potentially allowing the Justice Department to charge businesses with felonies.
While the full impact of these new provisions will remain uncertain for months as rules and regulations implementing these new processes are promulgated by the Copyright Office and the USPTO, some of the impact will be immediate, especially for those concerned with trademarks and branding. First, mark owners need to consider whether their own portfolio of trademark registrations (or a competitor’s portfolio) is potentially a target for these new cancellation tools. Second, businesses and practitioners alike need to think through how these new rules may impact their efforts to search and clear new marks, and whether marks uncovered in watch programs should be more aggressively challenged at earlier stages. Third, anyone considering an action alleging trademark infringement or violations of Section 43(a) of the Lanham Act should consider how a new presumption of irreparable harm can alter their broader enforcement strategy if injunctions are indeed more attainable.
In the months to come, you can expect that we will provide you with additional insights and practice tips addressing these new developments. In the meantime, while the arrival of a new year often inspires a reassessment of strategies and goals, these important changes to critical intellectual property statutes have guaranteed that this January will require an even greater level of planning for companies and practitioners alike.