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Don’t Get TRUMPed By a First-Filer

Posted in Almost Advice, Branding, Infringement, Loss of Rights, Trademarks

Reading over this story on Donald Trump’s decades of headaches (and conveniently-timed successes) with the TRUMP trademark and the Chinese Trademark Office, I was reminded, as I always am, of the importance of filing federal trademark applications.

The examination process for Trump’s marks in China, and the Chinese trademark enforcement regime generally, is rather opaque to U.S. practitioners. There is still a clear lesson to draw from his decades long attempt to register his TRUMP mark. Filling first matters. Even on this side of the Pacific Ocean.

I believe he's about to say "Filing first matters!"

I believe he’s about to say “Filing first matters!”

A common distinction when comparing U.S. trademark law to international jurisdictions concerns priority to use a trademark. Many trademark offices abroad give priority of use to the party “first to file” a given mark with the trademark office. In contrast, U.S. law generally favors the party “first to use” a given trademark. Because common law trademark rights accrue automatically upon use, a federal trademark application does not supersede a first-to-user.

The above is black letter “Trademarks 101” type information. But it’s actually not always the case, thanks to intent to use applications. These applications, which can be filed without any use of the corresponding mark in commerce, essentially turn the “first to use” doctrine on its head. Even if a party is the first to use, it will not have priority over a third party with an earlier filed intent to use trademark application. Consider the following examples:

  • A begins using the trademark TASTY SNACKERS for potato chips on July 1. B begins using the same trademark on August 1 of the same year. A will have priority to use the TASTY SNACKERS trademark over B as the “first to use.”
  • A begins using the trademark TASTY SNACKERS for potato chips on July 1. B files a trademark application for the same trademark on August 1 of the same year. Even though B is now the “first to file,” A will still have priority to use the TASTY SNACKERS trademark over B as the “first to use.” (We’ll assume A uses the mark in all 50 states, to avoid a concurrent use analysis)

So far so good, right? But see what happens when we throw an intent-to-use application in the mix:

  • A begins using the trademark TASTY SNACKERS for potato chips on July 1. One month earlier, B filed a trademark application for the same trademark on June 1. B begins using the TASTY SNACKERS trademark on August 1 of the same year. Here, A is still the “first to use,” but if B obtains registration of the TASTY SNACKERS mark, B will effectively enjoy priority to use the trademark in the U.S. as the “first to file.”

In order to establish its “first to use” priority for the TASTY SNACKERS mark, A would have to (i) oppose B’s application, or (ii) petition to cancel B’s subsequent registration, if A misses the opposition window. And there’s a worst-case scenario – if, somehow, B’s registration is not challenged for five years after registration, B can make his registration “incontestable,” and thereby preclude a petition for cancellation on grounds of priority. Essentially, headaches follow for the first user, if that first user is not also first to file a federal trademark application.

Trademark practitioners will agree that “first to use” is as American as apple pie and baseball. But even in the U.S., it’s hard to overstate the value of a timely-filed corresponding trademark application – ideally, an ITU application as soon as there are concrete plans to use the trademark. Otherwise, a first-filer in the U.S. can make a first-user rather “SAD!”