Is it sufficient for a U.S.-based user of a newly developed trademark to search solely in the U.S.? Certainly a search of PTO records is important to determine if an existing application or registration for the same or similar mark is of record. Conducting a search of other U.S.-based sources is also common. But is this enough? Many people, both lawyers and clients, may believe so, but here are two reasons why limiting a trademark search solely to U.S.-based sources, or to U.S.-based users, may not be sufficient.
First, Section 44 of the Lanham Act permits a trademark filing to be made in the U.S. by a foreign applicant within six months of the foreign filing, and to thereby be deemed filed in the U.S. as of the same date as filed in the foreign state.
44 (d) Right of priority.—An application for registration of a mark under sections 1, 3, 4, or 23 of this Act or under subsection (e) of this section filed by a person described in subsection (b) of this section who has previously duly filed an application for registration of the same mark in one of the countries described in subsection (b) shall be accorded the same force and effect as would be accorded to the same application if filed in the United States on the same date on which the application was first filed in such foreign country: Provided, that—Under Section 44 (e), if the foreign application matures into a foreign registration, then the timely filed 44(d) U.S. application can be registered in the U.S. with the same priority as the foreign registration. This is the case even if the foreign registrant does not use the mark in the U.S. at the time of the U.S. filing or the U.S. registration. Sect. 44 (e) only requires that the foreign registrant declare its bona fide intent to use the mark in the U.S., "but use in commerce shall not be required prior to registration [in the U.S.]." Id.
(1) the application in the United States is filed within six months from the date on which the application was first filed in the foreign country.
As such, if the foreign trademark owner is not using its trademark in the U.S., what is there to search, particularly if the seach is limited solely to U.S. users? Limiting the search to U.S.-based search sources may produce a false sense of security.
Second, the existence of a foreign trademark, even a mark whose owner never intends to establish physical use within the U.S., can create problems for a U.S. user seeking to register the same or similar mark in the U.S. This problem is illustrated in the case of First Niagara Ins. Brokers, Inc. v. First Niagara Financial Group, Inc. (Fed. Cir. 2007). First Niagara Ins. Brokers is an insurance broker operating solely in Canada. It it not licensed or authorized to engage in insurance brokerage service in the U.S. It has no physical presence in the U.S. The Canadian firm employs unregistered marks in Canada featuring the words First Niagara. A similarly named firm, First Niagara Financial Group, provides financial services, including insurance brokerage services, in New York State and is not authorized to engage in business, and has no physical presence, in Canada. The N.Y. firm filed several Intent to Use applications with the PTO featuring the words First Niagara for financial services. The Canadian firm filed oppositions, arguing that the N.Y. firm's marks would likely cause confusion with the Canadian firm's unregistered First Niagara marks. The N.Y. firm argued that the Canadian firm's lack of use of its marks in the U.S. would not permit the Canadian firm to establish priority in the U.S. because the Canadian firm was not using the mark in commerce in the U.S. The TTAB ruled that the Canadian firm did not have standing to oppose since it was not using its First Niagara marks in commerce in the U.S.
The Federal Circuit disagreed with the TTAB and held that the type of use made of the unregistered First Niagara marks by the Canadian firm was sufficient to support an opposition even though it would not be sufficient use in commerce in the U.S. to permit U.S. registration by the Canadian firm. The Federal Circuit held that an opposer has standing to oppose if it uses its mark in the U.S., even though the use does not qualify as "use in commerce." In examining the type of use in the U.S. made by the Canadian firm, the court explained that the Canadian insurance brokerage:
- procures insurance for Canadians who travel into the U.S.,
- handles U.S.-based insurance claims of its Canadian customers,
- procures commercial liability policies for Canadian business regarding their U.S. operations,
- issues policy riders insuring goods shipped by Canadian customers into the U.S.,
- procures coverage for the Niagara Falls Bridge Commission that operates the bridge between the U.S. and Canada at Niagara Falls, and
- distributes advertising in Canada that features its unregistered First Niagara marks, and some of this advertising spills over into the U.S., among other uses.
The foregoing suggests that limiting a trademark search to the U.S. is not sufficient to adequately discover trademark danger from foreign users. Foreign entities have an ability to obtain priority over, or oppose, a newly developed U.S. mark. Indeed, the First Niagara opinion by the Federal Circuit appears so broad as to give opposition standing to a wide range of foreign-based mark users, including renown foreign bespoke tailors, renown foreign specialty retailers, and other foreign mark users who are known to U.S. travelers or who sell goods to U.S. tourists on a frequent basis. The list is endless. As is the risk that a foreign mark user, with insufficient usage in the U.S. to support registration in the U.S., can block the registration in the U.S. of a bona fide and meaningful U.S.-based user.
Foreign trademark searching is important. Just do it.