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Trademarks on Software During Beta Testing

A trademark application filed with the United States Patent and Trademark Office must meet certain requirements to be eligible for registration.  At some point, almost all trademarks must be deemed “in use” before the Trademark Office will register them.  “In use” is short for “in use in commerce,” which itself is short for “in use in commerce that can be regulated by Congress,” i.e. interstate commerce or activities that impact or affect interstate commerce. 

Often, determining whether a trademark is in use is not a difficult act.  A restaurant has been operating for years with customers from all over the state?  In use.  Products are branded and sold to customers across the country?  In use.  A blog gets traffic everyday from all over the world?  In use. 

But the law is defined by its contours, its grey areas, and beta testing of software is one of them.  Beta testing, most frequently associated with software, is the practice of releasing a product to a group of customers who not only use it, but test it.  They may provide direct or indirect feedback about its operation.  It is a near-real-world test, allowing the owner to find and fix issues before a widespread release or launch. 

Because beta testing is often experimental, limited to a small number of customers, and done without a fee exchange, questions arise as to whether a trademark used in beta testing is “used in commerce.”  There are no clear answers here.  Courts have found beta testing to be either sufficient or insufficient to establish trademark use, each case having its own set of facts that leaned one way or the other. 

There are some factors that be evaluated to attempt to determine whether a trademark is in use during beta test.  More testers are more likely to be considered “in use.”  Testers outside the state that the company is in will weigh toward a finding of use in commerce.  Arms-length testers – not friends and family – will help lean toward use.  If the beta testing is consistent with other forms of beta testing in the ordinary course of trade within the relevant industry, use is more likely to be found.  The beta testing should not be simply marketing, but rather be part of an ongoing and eventually successful march toward launch.  The more widely available the beta testing is to the public, the better.  The consistency and normalcy with which the beta tested product is marked can affect the “in use” determination.  These factors are not determinative or exhaustive – others may exist and may be more influential, so it always a good idea to contact a trademark attorney to discuss whether your particular use of a trademark is sufficient. 

Lastly, to emphasize that this not a clear test, here is an excerpt from some of the Trademark Office rules:  “Specimens for software may also indicate that the software is a ‘beta’ version. This term is commonly used in the software field to identify a preliminary version of a product. Although some beta products may not be made available to consumers, others are. Thus, the appearance of this term on a specimen for software does not, by itself, necessarily mean that the relevant goods are not in actual use in commerce or that the specimen is unacceptable. However, if examination of the specimen indicates that the beta version is not in actual use in commerce, the examining attorney must refuse registration … because the applicant has not provided evidence of use of the applied-for mark in commerce. ”  TMEP 904.03(e). 



The Patent Office is Not (Yet) Affected by the Government Shutdown

Nearly a month into the government shutdown, the United States Patent and Trademark Office continues to run at full capacity.  The Patent Office is somewhat self-funded, in that the fees that applicants pay to file and prosecute patent applications are used to pay examiners and other staff.  However, the Patent Office is not allowed to spend all of that money willy-nilly; its budget is set by Congress, and the Office is permitted to spend up to that budget limit assuming sufficient fees are collected. 

In past years, sufficient fees have been collected, and with great foresight, the Patent Office has funded an operating reserve account with some of those fees.  While the Patent Office has a separate reserve fund which is supplied by fees paid in excess of the budget, the money into the operating reserve represent fees siphoned from the budget, perhaps the delta between the budget and the operating costs of the PTO.  And, while the reserve fund is empty, the operating reserve has about $300 million.  This is enough to keep the Patent Office running for a short time, about five weeks.

The operating reserve is not exhausted, but is being steadily consumed with this shutdown.  As it drains further, “non-essential” activities will be suspended.  Examiners will likely pause their reviews of applications.  However, the filing systems – and the staff necessary to support them – will remain online so that application filing deadlines can continue to be met.  It is not clear what will happen if the shutdown continues to the point where there aren’t even fees to keep the filing systems up….



Request to Divide a Trademark Application

Occasionally, there will be a need in a trademark application to divide a portion of it out of the application. Dividing an application removes, but does not delete, the identified portion and creates a new application on that portion. This will be done for a number of reasons, such as:

  • The application has been rejected on some of the goods or services but not all of them
  • The mark is being used on some goods or services but not all
  • A suspension has been issued, but only against some of the goods or services

Dividing the goods or services will allow the original application to proceed for further examination. The divided goods or services are made subject to a new application where their particular issues can be addressed separately, without affecting the original application.

There is a cost for dividing an application. In the case of a request to divide out one or more entire classes of goods or services, only a dividing fee is necessary ($100 at the time of this writing). However, in the case of a request to divide out some, but not all, of the goods or services in a class, the dividing fee is required in addition to a new application filing fee (probably $225 or $275 per new class). In other words, it is cheaper to divide an entire class of goods or services than just a portion of that class. In some cases, a trademark applicant may have the luxury of choosing between these, while in other cases, the decision may be forced by the circumstances.



Patent Office Transitions to MyUSPTO Login

For many years, registered patent attorneys, patent agents, and some pro se inventors have been able to log into a secure portal at the Patent Office website to file and monitor patent applications. The portal is protected by both a password and a digital key that requires a lengthy certification process with the Patent Office, so it has mostly just been used by attorneys and agents.

This past month, the Patent Office introduced MyUSPTO.gov, which it billed as a “new, simpler, and safer USPTO.gov account” through which you can access patent and trademark files, monitor a docket, create watches to keep track of competitive patents or your own, and to access the search databases for both patents and trademarks. It is an attempt to unify patent and trademark records, as well as the filing and monitoring systems previously available through the Patent Office only.

Practitioners were asked to link their old portal accounts to their new MyUSPTO.gov accounts by the end of October. Fearing that the old portal would become inaccessible come November, I did this at the beginning of October. What I’ve learned is that while MyUSPTO.gov does offer all the things mentioned above, it also additionally requires two-step verification each day, after completing a prolonged CAPTCHA. This is annoying and unnecessary. I’m not aware of any other provider that requires daily two-step verification; even WIPO doesn’t have it.

As a result, I haven’t been using the MyUSPTO.gov login at all. All of the old services are accessible, and more easily accessible than MyUSPTO.gov. The USPTO is reporting that the digital keys will be officially retired in December, and that a new Patent Center software suite will be rolled out in 2020. As long as the Office continues to provide the old portal login system, I will probably use it, unless they ease this two-step requirement.



Changing a Trademark From One Word to Two, or Two Words to One

Trademark applications frequently are filed and then need to be amended slightly. Sometimes these amendments are to change the identification of goods or services for the application, or to change the way the mark is described. Changes such as these are usually straightforward.

Sometimes, though, the trademark itself needs to be amended. This always needs to be done with extreme care and planning. This need usually arises in the context of an intent-to-use application, where an entity files a trademark application on a mark it is planning to use. Sometimes, the company or person is planning on using one form of a mark but then when the product actually goes to market, the form changes. Many times, I’ve seen a mark get filed as one word or as two words and then need to be switched to two words or one word, respectively. In other words, an application may be filed in the form ONE TWO and then need to be changed to ONETWO, or be changed from ONETWO to ONE TWO.

Changes like this are often driven by the way the mark is eventually actually used in commerce. Of course, preferably these changes can be anticipated and dealt with early; the timing of the change within the course of prosecution of the application can affect the ability and ease of making the change. Since the mark is usually already being used, changing the actual trademark is usually not an option. In other words, re-branding to keep the trademark consistent with the application is usually not an option – the costs of new designs, new printing, new labels, new stickers, new stitching, etc. are prohibitive. So usually the trademark application must be amended.

I do not recommend making changes to the mark in the application without the assistance of a trademark attorney. Per the trademark examination rules, a proposed amendment cannot materially alter the mark. If an Examiner finds that a proposed amendment materially alters the mark, the Examiner will refuse to enter the amendment, and then the application’s mark and the actual trademark will forever be inconsistent, leading ultimately to trademark application being abandoned. In some cases, depending on the timing of the amendment, the Examiner may not even be able to enter it, even if he or she would otherwise approve it. In other cases, it is better to file a response or a statement of use that shows the mark inconsistently, wait for the Examiner to raise the issue, and then respond.

Though changing the mark may seem like a very simple thing to do, it can have disastrous consequences, including abandonment of the application, and so careful planning and good counseling is absolutely necessary.



Filing an Amendment to a Trademark Application After Issuance of a Notice of Allowance but Before Submission of a Statement of Use

Trademark applications which are filed on an intent-to-use basis always present slight risks since the application is filed before the owner has begun using the trademark and before the owner knows 100% how the trademark will be used. There is always the possibility that the trademark will be changed somehow when the mark is actually used.

Generally, once a trademark application is filed, only limited changes can be made to the application, such as removing goods or services, amending the mark description, very minor changes to the mark itself, changing the attorney, some changes to the owner identification. These changes become more difficult to make the longer the application processes. Usually, the changes are most easily made before examination occurs (typically in the first 3-4 months). Once examination has begun, Examiners will often be more reluctant to approve changes. Of course, some changes may be necessitated by issues raised in an Office Action from the Examiner. After examination, most marks are scheduled for publication. Any changes should really tried to be made before publication, because once the trademark application is published, the application can only be changed on very limited grounds. Some changes cannot be made at all. Some changes require a petition to the Director.

Once publication ends, and a Notice of Allowance has issued in an intent-to-use trademark application, changes become even more limited. Generally, the only amendments that may be entered in an application between the issuance of the notice of allowance and the submission of a statement of use are: (1) the deletion of specified goods or services, or the entire description of the nature of the collective membership organization, from the identification; (2) the deletion of a basis in a multiple-basis application; and (3) changes of attorney and changes of address. The Trademark Office will enter other amendments during this period, but only with the express permission of the Director. This requires filing a petition laying out facts and reasons for the change, as well as payment of the petition fee. If the Director determines that the amendment requires review by the examining attorney, the petition will be denied and the amendment may be resubmitted with the statement of use in order for the applicant to preserve its right to review.



How to Reinstate An Expired Patent

This article covers reinstatement of an expired patent – not revival of an abandoned patent application. They are very different, and I’ve previously written about the reviving an abandoned patent application.

After a patent issues, regular maintenance fees must be paid to keep it alive. At the each of 3.5 year mark, 7.5 year mark, and 11.5 year mark, a six-month window opens in which the patent owner can pay the required maintenance fees. The fees are different in each window, and they increase over time. If the fees are timely paid, the patent will remain in force until the next window. If the fees are not paid, however, the patent will expire.

As such, it is crucial that patent owners create reminders for these windows. They should probably create reminders on two separate calendar systems, as deadlines years in the future can be difficult to track.

Nevertheless, sometimes a maintenance fee is missed, and the patent does expire. There is a limited avenue to bring the patent back to life, however. A petition can be filed with the Patent Office requesting the delayed payment of a maintenance fee, if the delay was unintentional.

Any petition to accept an unintentionally delayed payment of a maintenance fee must include the missed maintenance fee, a petition fee, a statement that the delay in payment of the maintenance fee was unintentional. Sometimes, with long delays, the Patent Office will request require additional information regarding the delay, to determine whether it was truly unintentional or not.

If multiple maintenance fees are missed, it is possible to still reinstate the patent. However, each maintenance fee must be paid along with the petition fee, and this could be quite expensive. At the time of this writing, the petition fee only is $2,000 for large entities and $1,000 for small entities. And, if multiple maintenance fees have been missed, the delay is likely quite long, and the Patent Office will almost certainly inquire about the delay.



Can I sign up for Amazon Brand Registry 2.0 if my trademark has not yet registered?

Unfortunately, no. Amazon Brand Registry 2.0 only accepts registered trademarks.

There are two types of trademarks: common law trademarks and registered trademarks. These two categories are not at all mutually exclusive; a common law trademark can become a registered trademark, and virtually all registered trademarks have a common law basis. Only registered trademarks can be relied on for Amazon Brand Registry 2.0.

Common law trademarks are trademarks which are used but not registered. Owners of common law trademarks develop rights in such marks geographically, as the mark is used with products or services that are offered and sold geographically. For example, if you sell bath products in Arizona, you develop common law trademark rights in the name of the bath products in Arizona. As you sell the bath products into other states – Nevada, California, New Mexico, you will begin to acquire trademark rights in those states as well. But if you haven’t sold into Kansas, or Texas, or Ohio, for example, you don’t have rights in those states.

Internet sales complicate this a bit. If you sell on Amazon, for instance, you have offerings that are available across the entire United States. Your common law rights will depend on each state’s laws governing common law rights arising from Internet use, but often this test is a multi-factorial one weighing on the number of sales into the state or other targeting or advertising activities associated with the state.

Contrasted from common law trademarks, registered trademark are those that have been vetted and approved by the United States Patent and Trademark Office. These are trademarks that have been filed, examined, approved, and registered through the USPTO, in a process that takes at least 6-7 months. Your ability to federally register a trademark requires that you use the mark in interstate commerce (which has its own particular definitions and requirements), and also that there not be any confusingly similar trademarks already registered or pending before the USPTO. And, of course, you must prepare and file the trademark application correctly.

At the time of this writing, Amazon Brand Registry 2.0 is only available to trademarks which have gone through the entire registration process at the USPTO, not common law trademarks. An application that has been filed and is still pending cannot support sign up to Amazon Brand Registry 2.0. Rather, Amazon requires that the mark have fully processed through the USPTO and issued as a registration. Because trademark applications take at least 6-7 months to process, and any hiccups can slow that process, it is recommended that those wishing to register with Amazon consult a trademark attorney to mitigate the risk of delays.



Is the U.S. Patent and Trademark Office Affected by the 2018 Government Shutdown?

The U.S. Patent and Trademark Office is not affected by the shutdown which has closed many government offices and agencies after Congress failed to pass a funding resolution.  Navigate to www.uspto.gov and you’ll be greeted by the banner announcing the Office is still open.

While other agencies are dependent upon immediate funding for their continuance, the USPTO maintains a reserve account of funds. The funds allow the Office to continue operating at nearly full capacity for at least a few weeks. These are collected, in part, from the applicants that have filed and prosecuted patent and trademark applications in the United States in previous years.

In December 2017, the Commerce Department issued a shutdown plan which noted: “The USPTO anticipates that it will have sufficient funds from other than current year appropriations to continue full operations for a brief period after a general lapse in appropriations commences. Therefore, all employees of the USPTO will be excepted for such period following a lapse in appropriations.” Commerce Secretary Wilbur Ross emailed USPTO employees on Friday, January 19, 2018 directing them to continue reporting for work until they were notified otherwise.

Collections from previous years enable the USPTO to operate despite furloughs at other federal agencies. The USPTO is well-funded; in fact, it generates far more money in fees than it consumes in expenses. However, fee diversion moves much of its revenue to other governmental agencies. The 2011 America Invents Act allows the Office to trap some of those fees into the reserve account before they can be diverted outside the agency.

Should the shutdown continue and the reserve funds be consumed, employees would begin to be furloughed. A small staff would nevertheless remain to accept new applications and to maintain the IT infrastructure. The electronic filing systems through which most patent attorneys and agents correspond with the USPTO would continue to operate, allowing filing dates to be established and deadlines to be met. The shutdown does close down the File Repository Warehouse, where the paper files for older patent applications are maintained. That warehouse is not operated by the USPTO and so is affected by the shutdown. As such, requests for copies of paper files (which normally take 1-4 weeks for production) will likely be delayed. This would not affect electronic files, of course.

In 2013, the government shut down lasted for two and a half weeks. The USPTO stayed open then, too, using the same reserve fund.



Patent Prosecution Highway to Expedite Examination of a Patent Application

The Patent Prosecution Highway, or “PPH,” speeds up the examination process for patent applications filed in participating intellectual property offices around the world. In most countries, patent prosecution can take quite a long time, on the order of 1-3 years or more.

However, under the Patent Prosecution Highway, participating patent offices have agreed that when an applicant receives a final ruling from the patent office of one country, and that office determines that at least one claim is allowed, the applicant may then request fast tracked examination of corresponding claims in a corresponding patent application that is pending in the patent office of another country. For example, if you file a US patent application and a Chinese patent application, and the Chinese patent application receives favorable examination first, indicating that four of the claims are allowed, you can expedite examination of those four claims in the US application.

PPH leverages fast-track examination procedures already in place among participating patent offices to allow applicants to reach final disposition of a patent application more quickly and efficiently than standard examination processing.

There is no fee under the PPH programs, and often, applications advanced under the Patent Prosecution Highway receive favorable examination. This creates considerable cost and time savings in what is otherwise a very expensive multi-national filing.

Many countries or bodies participate in the Patent Prosecution Highway and have reciprocity with the US. Most notably, Australia, the European Patent Office, Canada, China, Japan, Germany, Korea, and the UK all participate. Further, the results of a favorable written opinion or examination of a PCT application can be used as the basis for a PPH request.