United States: National
Despite the devastating impact of covid-19 restrictions, brand-related activity has not slowed down in the world’s largest consumer market, but in fact has seen new peaks, with higher application levels in the first six months of 2020 than the equivalent period in 2019. Chinese businesses have surpassed US companies to...
Despite the devastating impact of covid-19 restrictions, brand-related activity has not slowed down in the world’s largest consumer market, but in fact has seen new peaks, with higher application levels in the first six months of 2020 than the equivalent period in 2019. Chinese businesses have surpassed US companies to become the most prolific filers at the USPTO, according to a report published by CompuMark. This reflects the continued interest of Chinese applicants in the US market, despite the new rule requiring representation by US-based counsel. On the other hand, trademark litigation in the first half of the year dropped by around 29% on the same period in 2019; but some key decisions were nonetheless issued. Two lawsuits before the US Supreme Court attracted intense attention and widespread media coverage. In a unanimous decision in Romag v Fossil, the court ruled that wilfulness is not a precondition for awarding disgorgement of profits. The judgment is hugely significant in offering monetary relief to brand owners while deterring would-be infringers. It is thus positive news for rights holders involved in trademark litigation; but on the flipside, some experts have voiced fears that it could lead to a rise in frivolous suits. It will thus take time before the real impact of this decision becomes clear. In the Booking.com case, the US Supreme Court rejected the USPTO’s argument that a generic term combined with the ‘.com’ top-level domain will be considered generic and ineligible for trademark protection. The court declared that whether a term is generic must be considered in light of general consumer perceptions. Both cases highlight the increasingly critical role that trademarks play in dictating the fortunes of brands. In another development, more than 160 brands – including Coca-Cola, Honda, Verizon and Unilever – signed up to the #StopHateforProfit campaign, pledging not to advertise through Facebook for the month of July 2020 in a bid to push the social media giant to address the proliferation of hate on its platforms. This acts as a reminder of the power and influence that brand owners can exert in supporting social movements. With footfall on the high street plummeting in inverse proportion to e-commerce activity, it is no surprise that many brands are increasingly devoting their attentions and resources exclusively to online sales and advertising. However, the lockdown also saw a spike in phishing and other online scams; as a result, law firms have been deploying highly sophisticated tools to deter and defeat bad actors, and there is heightened demand for expertise in online enforcement and domain name disputes. On the international scene, Under Armour prevailed in a dispute against a clothing brand Uncle Martian in China’s Supreme People’s Court, receiving a $300,000 damages award. This decision is a step in the right direction and a positive signal for brand owners – especially in light of a report issued by National Association of Manufacturers (NAM) suggesting that counterfeiting is costing the US economy $131 billion per year. The report highlights that counterfeit goods cost billions in federal tax revenues, while only 2.3% of these are caught by the US government. NAM has called for the creation of a dedicated US agency to tackle counterfeiting throughout the country and beyond. USPTO Director Andrei Iancu has also called for a united and systematic effort to prevent fakes from entering the US market. Commentators have hailed the Shop Safe Act of 2020, compelling e-commerce sites to take measures to prevent the sale of counterfeits on their platforms, as a step in the right direction; but concerted action is still needed to make a decisive difference.