Trademark Law and Litigation is Booming

Trademark law, historically an afterthought of patent law practice, has come into its own and is flexing some very strong muscles. As corporate assets gravitate increasingly toward intellectual property and intangibles, companies are realizing that the protection and monetization of trademarks must be a core concern and are acting accordingly. This opens up opportunities for practicing in a dynamic, growth arena where the learning curve is not very steep.

The Evidence
All of the numbers point upward. Trademark applications to the U.S. Patent and Trademark Office (PTO) http://www.uspto.gov are climbing steadily, breaking new records every year. Active U.S. trademark registrations now exceed 2 million for the first time in history. Globally, trademark applications are also booming (this is important data because trademark protection has become increasingly international).

An estimated 3.66 million trademark applications were filed worldwide in 2010. An estimated 6 million trademark applications  were filed globally in 2015. Largely driven by China, applications increased by 15.3%, which represents the highest growth since 2000 ( World Intellectual Property Organization (WIPO) http://wipo.int). U.S. residents filed more than 500,000 of those applications.

Globalization
An interconnected world means that business is going global. That, in turn, requires international trademark protection on an unprecedented scale. U.S. companies, both public and private, large and small now find it necessary to protect their IP beyond our borders. The means of doing that have expanded greatly in recent years, and the process for accomplishing that have followed suit (see, e.g., the Madrid Protocol http://wipo.int/madrid/en/).

A Stand-Alone Practice
As indicated in the lead-in, for most of its history trademark practice was viewed as an ancillary sideline of patent practice. If a client had a mark that needed to be filed, its patent firm would do it, but did not consider it anything more than a client courtesy. Not anymore. Today, trademark–only firms are proliferating and expanding throughout the U.S.

Geographic Liberalization
Trademark law was, for most of its history, one of the most Washington, DC-centric practices extant. While PTO is still headquartered in the Washington, DC area (Alexandria, Virginia), electronic filing and disposition of trademark applications means that trademark law can be practiced from any location. PTO’s Trademark Electronic Application System (TEAS) now accounts for almost all trademark application filings.

Trademark Practice
Simplified, trademark law encompasses three distinct practices:
Application
Filing an application for trademark protection and the ensuing steps to securing that protection can be divided into two components:
Private sector attorneys and law firms that prepare, file and defend initial trademark applications; and
Trademark examinations and dispositions by attorneys at PTO. Principal duties include:
•    Examining domestic and foreign trademark applications for statutory, regulatory, and treaty compliance;
•    Conducting detailed searches to ensure applications, if approved, would not impinge on existing intellectual property rights of others or harm the public;
•    Creating original statements of goods and services, based on application information, capable of registration;
•    Gathering and evaluating evidence supporting substantive refusals of applications;
•    Advising and counseling applicants to resolve bars to registration and clarify prosecution issues.
•    Conducting legal research and drafting the Office’s position refusing registration, and evaluating applicants’ arguments and supporting evidence in favor of registration; and
•    They also represent the Office in the small number of their cases that are heard by the Trademark Trial and Appeals Board (TTAB).

PTO offers its lawyers an intense immersion in trademark law that provides a very solid platform for career advancement. Office alumni, some with only 18 months of experience, have gone on to work for major and boutique trademark law firms as well as major corporations such as Procter & Gamble and NASCAR.

Similar to the geographic liberalization wrought by electronic filing, PTO trademark lawyers are also now dispersed throughout the country. They no longer must reside in the Washington, DC area, but may “tele-work” from anywhere.

However, the surge in filings has put them under tremendous pressure to “produce,” so much so that they are now required to report their production status to PTO headquarters several times a day! A typical examining attorney produces 1,500 dispositions per year. Top producers can earn substantial bonuses.

Note: I worked with a number of PTO trademark lawyers who were attractive to legal recruiters based on their intense exposure to trademark law, and for whom corporate in-house counsel offices were willing to “lower the bar” with respect to their academic qualifications.

Litigation
As the monetary value of trademarks increases, so do disputes over ownership and abuse of proprietary rights. Trademark attorneys have been very busy, filing more than 24,000 trademark cases in the courts since 2009. More than 4,000 new trademark cases were filed in 2014 alone. A typical case seeks an injunction and damages for infringement, violations of fair use, or cybersquatting. These cases have resulted in awards of more than $9 billion in cumulative damages, almost all of which come from default judgments. Most of the rest are the result of consent judgments.

The most active jurisdictions hearing trademark cases are the Central District of California (primarily music, film and fashion cases), the Southern District of Florida (primarily luxury brands), and the Southern District of New York and Northern District of Illinois (primarily major brands and fashion).

Monetization
When British spirits company Diageo purchased a large portion of Seagram’s business, the transaction included the transfer of more than 30,000 Seagram trademarks that had been filed in 80 countries throughout the world. Diageo engaged a large number of trademark attorneys to determine the protected status of these marks and take the necessary steps to bring the ones determined to have licensing or other value up to full protection. This years-long effort then evolved into a business strategy to maximize their revenue potential.

This is just one small example of the trademark asset management function that is now a vital part of thousands of companies’ business models.

Detailed information on IP opportunities can be found in “Soft” Intellectual Property Law: IP Opportunities for Non-STEM Attorneys.