Trademark Abandonment: How Does it Happen and What is the Effect?

A trademark becomes abandoned if its use has been discontinued with intent not to resume such use, according to 15 USC § 1127. Abandonment can have devastating effects on the trademark owner. A trademark owner’s failure to use a mark can result in loss of trademark rights. This article delves into what trademark abandonment entails, how it can occur, the legal effects associated with abandonment, and what it ultimately means for the trademark owner.

What is Trademark Abandonment?

Trademarks, unlike patents, require continuous use to retain their legal protection. Failure to demonstrate continued use, along with evidence suggesting no intent to resume, can lead to abandonment. Under Section 45 of the Lanham Act, trademark abandonment is defined as the discontinuation of a trademark’s use with no intent to resume. Specifically, “a mark shall be deemed to be abandoned if its use has been discontinued with intent not to resume such use.” Intent not to resume use may be inferred from the circumstances.​

Forms of Abandonment: Intentional and Constructive

Trademark abandonment can be classified into two main forms:

1. Intentional Abandonment – This occurs when the trademark owner deliberately discontinues use and with no intent to resume use in the future. For example, an express statement of intent to abandon, often filed with the USPTO, immediately triggers abandonment.
2. Constructive Abandonment – This form of abandonment is inferred by law from three years of continuous nonuse coupled with circumstantial evidence indicating no intent to resume use. According to 15 U.S.C. § 1127, three consecutive years of nonuse creates prima facie evidence of abandonment. This presumption serves as a powerful tool for a party seeking to cancel a registration on the basis of nonuse. If a three-year period of non-use is demonstrated, the burden shifts to the owner of the mark, who must show that either (1)there was, in fact, use of the mark during the three-year period, or (2) there was an intent to resume use of the mark within reasonable time.
3. Mark Becomes Generic - If consumers begin using the mark as the generic name for the goods or services, the mark becomes generic and is considered to be an abandoned trademark. This is commonly referred to as genericide.
4. Naked Licensing - A trademark can be abandoned through naked licensing, which occurs when the trademark owner allows others to use the trademark without maintaining adequate quality control over the goods or services provided by others under the trademark. This lack of oversight can cause the mark to lose its significance as an indicator of a single source, resulting in a loss of trademark rights. For instance, in FreecycleSunnyvale v. The Freecycle Network, 626 F.3d 509 (9th Cir. 2010), the court found that the plaintiff failed to exert sufficient control over use of the mark by the defendant because there was no written contract in place, the plaintiff did not have the ability to impose its standards of communications presented in internet groups in connection with the trademark, and it did not have any control over the quality of the services provided by the groups using the trademark.

Abandoned Trademark Versus Abandoned Application or Registration

The abandonment of a trademark differs from the abandonment of a trademark application or registration in both definition and consequences.

• Trademark Abandonment: Refers to the loss of rights in a trademark due to nonuse with no intent to resume. This affects the owner’s ability to assert exclusive rights over the mark in any form, including under the common law.
• Application/Registration Abandonment: Involves procedural failure, such as missing deadlines to respond to USPTO office actions, file Statements of Use, or renew the registration. While abandonment of an application or registration terminates the filing, the owner may still retain common law rights through actual use of the mark in commerce.

Abandonment of a trademark signifies the loss of substantive rights, whereas application/registration abandonment affects procedural status but not necessarily ownership or use rights.

Trademark Abandonment in Applications and Registrations

Procedural Failures by Trademark Owner

Abandonment of a trademark application may result from failure to file an office action response during examination of the application. When an examining attorney issues an office action in your pending trademark application, you are required to file a complete response addressing each issue raised in the office action by the specified due date, which is three months, extendable to six months.

A trademark application may also be abandoned if you fail to submit a Statement of Use in an intent-to-use application within the required time period. These procedural failures result in the issuance of a notice of abandonment, which provides two months to respond to the notice and revive the application. If no response is filed, the application is permanently abandoned.

A registration may be abandoned where the registrant fails to submit maintenance and renewal filings that are periodically required to maintain the registration. Between the 5th and 6th years after the registration date, a Section 8 Declaration of Continued Use or Excusable Nonuse must be submitted to confirm that the mark is still in use in commerce or that nonuse is excusable and maintain the trademark registration. Also, every 10 years after registration, you must file Section 8 and 9 Renewals, which confirm ongoing use (Section 8) and renew the registration (Section 9), which will otherwise expire. Failure to file these renewals results in cancellation of the registration.

These procedural abandonments result in a loss of the numerous benefits provided by a federal trademark registration. However, the loss of a trademark registration or application does not negate any common law rights the applicant may have acquired through actual use of the mark, but it does mean that a fresh application may be necessary to acquire a federal registration.

Challenges to Applications or Registrations through Trademark Trial and Appeal Board (TTAB) Proceedings

A trademark application or registration may be challenged before the Trademark Trial and Appeal Board (TTAB) through an abandonment claim or nonuse claim. Under the Trademark Act, an abandonment claim requires proof of two elements: nonuse of the trademark and an intention not to resume use. Nonuse for three consecutive years creates a presumption of abandonment, shifting the burden to the trademark owner to rebut the claim by showing evidence of use or an intent to resume use.

To prove abandonment, the challenging party must provide evidence of nonuse and circumstances suggesting the owner’s intent not to resume use. Similarly, a nonuse claim may target an application or registration when the mark was not in use at the time of filing or for specific goods or services. By presenting sufficient proof, the petitioner or opposer can invalidate the application or registration.

In recent years, the USPTO has initiated pilot programs to accelerate cancellation actions based on grounds of abandonment or nonuse through the Trademark Modernization Act. This expedited process, specifically designed to uphold the integrity of the U.S. Trademark Register, is limited to cases where clear evidence of abandonment exists, and counterclaims are absent. In TV Azteca, S.A.B. de C.V. v. Jeffrey E. Martin, the TTAB illustrated how streamlined proceedings can facilitate the efficient removal of unused or abandoned marks from the register, clearing the path for new applications and trademarks in active use​.

Proving Trademark Abandonment Claim

Federally registered trademarks are presumed valid under the law, placing the initial burden of proving abandonment on the party asserting the claim. According to Section 45 of the Lanham Act, a trademark is deemed abandoned when its use has ceased with no intent to resume. This intent may be inferred from the circumstances. Additionally, if a trademark has not been used for three consecutive years, there is a prima facie case of abandonment and the mark is considered abandoned, unless the trademark owner can demonstrate continued use or intent to resume use.

Effects of Abandonment on Trademark Rights

The abandonment of a trademark can lead to several significant consequences:

1. Loss of Exclusive Rights – When a trademark is deemed abandoned, the owner loses the exclusive rights to use the mark in connection with the goods or services previously associated with it. This opens the door for third parties to adopt and register similar marks without infringing on the original owner’s rights.
2. Loss of Trademark Registration – Registrations for abandoned trademarks, even those registered for more than five years, may be subject to cancellation if a petitioner can demonstrate that the mark has been abandoned. As outlined in 15 U.S.C. § 1064, a trademark older than five years can still face cancellation due to abandonment.
3. Challenges in Reviving Rights – Although a trademark owner may file a petition to revive an abandoned application if nonuse was unintentional, it is difficult to reestablish rights in a trademark once it has been legally abandoned.

Reviving an Abandoned Mark

An applicant may petition to revive an abandoned trademark application if certain conditions are met. Upon receiving a Notice of Abandonment from the USPTO, the owner has two months to respond. If the owner did not receive the notice, they may file a petition to revive the application within six months. The petition must include a statement and supporting evidence explaining the reasons for abandoning the application. Failure to file the petition within the allowed timeframe will require the owner to start the registration process anew by filing a new application, potentially delaying their trademark protection. Prompt action is essential to preserve rights.

Contact Sierra IP Law, PC for Assistance with Your Trademarks

The trademark attorneys at Sierra IP Law have decades of experience handling trademark applications, trademark disputes, and all other types of trademark matters for their clients. We have the expertise and skill to assist you or your company with its critical trademark needs. Contact us for a free consultation.

© 2024 Sierra IP Law. The information provided herein is not intended to be legal advice, but merely conveys general information that may be beneficial to the public, and should not be viewed as a substitute for legal consultation in a particular case.