USPTO issues signficant new rules
January, 2008
Introduction. On August 1, 2007 the U.S. Patent and Trademark Office ("US PTO") announced new rules of practice applicable to contested proceedings before the Trademark Trial and Appeal Board ("the TTAB"). The TTAB is the body within the US PTO responsible for hearing and deciding certain kinds of trademark cases. These cases include appeals from decisions by US PTO examiners, as well as certain kinds of contested case proceedings, including oppositions to registration, cancellation proceedings against registered marks, and concurrent use proceedings.
The most significant changes to the TTAB rules went into effect for cases filed on or after November 1, 2007, and will be relevant to future considerations of whether to select the TTAB or federal court for trademark disputes. Although these changes were intended by the PTO to increase efficiencies in the service of process, to speed the resolution of cases and to promote a greater exchange of information, thereby leading to increased procedural fairness, the net effect will likely be to increase the costs, length and complexity of proceedings before the TTAB, making the TTAB function much more like federal court.
Primary Procedural Changes. The primary changes to TTAB procedures include the direct service of the initial pleading by those filing oppositions and petitions to cancel.
[1] Prior to this change, service was made by the TTAB. Because the only address records that a plaintiff must consult prior to service are those listed with the TTAB's Trademark Applications and Registrations Retrieval ("TARR") system, found at
http://tarr.uspto.gov, trademark owners are wise to update their address records with the TTAB to ensure they receive prompt notice of any such complaints. Plaintiffs should be aware than any pleadings filed without the required proof of service will not be granted a filing date by the TTAB, a result which could lead to a significant loss of substantive rights.
The changes also require an initial discovery conference between the parties within 30 days from the date the answer is due, and before discovery can begin, much like in federal court. Unlike federal court, the discovery conference may be attended – at the request of a party - by a Board professional, such as an attorney or administrative trademark judge, who can assist with the education of unrepresented parties or counsel unaccustomed to practicing before the TTAB.
Initial disclosures are also now a part of TTAB proceedings, as they have been part of federal court proceedings since 1993. These disclosures require the parties to "voluntarily" provide basic information about witnesses, documents and things having or containing discoverable information that they may use to support their claims or defenses.
Also, similar to federal court, the new TTAB rules require parties to disclose their intentions to use an expert to testify at trial no later than 30 days prior to the close of discovery.[2] In addition to initial and expert disclosures, the new TTAB rules require pretrial disclosures, although they are less onerous than in federal court because they only require the disclosure of potential witnesses and a summary of exhibits about which those witnesses may testify; they don't require that the exhibits themselves be disclosed and exchanged.
Finally, and perhaps most importantly, the new TTAB rules provide that, if a defendant, upon receiving notice of a request for extension of time to file an opposition, voluntarily withdraws the application before an opposition is filed, the withdrawal is without prejudice. However, if that same defendant waits to withdraw its application until after the opposition had been filed, as has been a common practice during settlement negotiations, and does not obtain the opposer's consent to do so, the withdrawal will be with prejudice, meaning that an application for the same mark on the same goods and/or services cannot be filed in the future.
Primary Scheduling Changes. Based upon the TTAB's published schedule for cases under the new "disclosure model," and assuming no extensions of the schedule are granted, the new rules provide that a case will be submitted for decision by the TTAB within 550 days, or a year and a half after the case was commenced. This is 50 days longer than under the old rules. Moreover, the new rules provide for additional potential bases for motions relating to the initial discovery conference and initial disclosures, potentially leading to even further delays. And, the comments to the new rules provide that they do not alter the TTAB's traditional liberal approach to granting motions to suspend the case to allow for settlement discussions.
Net Effect of the Changes. The net effect of the changes will likely be that (1) the burden and expense of TTAB proceedings will increase; (2) the length of the process will increase by at least 50 days and probably more; and (3) the chances of early settlement may somewhat increase due to the greater information exchange early on in the case. However, early settlement is not a foregone conclusion given the very general requirements for initial disclosures and the parties' ability to only make broad brush disclosures which may not lead to early settlement. In sum, parties are likely to increasingly consider heading to court for money damages, rather than waiting around for the TTAB. Therefore, be sure to discuss the benefits and drawbacks of these two competing forums for litigation with your trademark counsel before undertaking legal action.
[1] The concurrent use applicant must now promptly serve a copy of its application on each of the parties it has listed in its concurrent use application as an exception to the concurrent use applicant's rights, rather than sending the addresses to the TTAB with sufficient service copies, as under the old rules.
[2] Unless the opposing party seeks such information through proper discovery requests, in which case disclosure will be required when the responses to the discovery requests are due.