TRADEMARK LAW
Cascading Best Practice
As INTA’s Board of Directors passes a Resolution for a Revision of its Model State Trademark Bill, the architects of these key changes explain why the time had come for an update. Muireann Bolger reports.
Over the past seven decades, INTA’s Model State Trademark Bill has offered an invaluable source of guidance to federal and state government policy officials and legislatures across the United States.
To reflect the emergence of pivotal amendments to the federal Lanham Act and U.S. Supreme Court rulings on trademark law in recent years, INTA’s Board of Directors passed a Resolution for a Revision of the Model State Trademark Bill on November 15.
This comes in the wake of this year’s 75th anniversary of the Lanham Act, the primary federal trademark law of the United States.
Since its introduction, INTA’s Model State Trademark Bill has fostered a uniformity of trademark legislation across the United States that has been consistent with the Lanham Act. As of today, 46 U.S. states have adopted some version of the Model State Trademark Bill.
The latest revision marks the most substantial update to the Trademark Bill since it was first introduced in 1949 by the then-United States Trademark Association (now INTA). INTA’s Board had approved subsequent revisions in 1992, 1996, and 2007.
The Board Resolution follows the research and recommendations of a working group appointed by INTA’s U.S. Subcommittee of the Legislation and Regulation Committee.
Two members of the Subcommittee, Roderick J. Enns, partner, Enns & Archer LLP (US), and Howard S. Hogan, partner, Gibson, Dunn & Crutcher LLP (US), presented the Resolution to the Board. Alongside U.S. Subcommittee Chair Anne Gilson LaLonde of Gilson on Trademarks (US), they led the work on the new Bill.
Speaking to the INTA Daily News, Mr. Enns and Mr. Hogan described the Bill’s rich history and value, and why INTA felt it was time for the first update in 14 years.
Mr. Enns described the Bill as an “advisory document, designed as a template for U.S. states to look at when enacting or informing their own trademark laws.”
“We wanted to ensure the Bill conformed to U.S. Supreme Court guidance on how the Lanham Act should be interpreted.”
Howard S. Hogan, Gibson, Dunn & Crutcher (US)
A Guiding Force
From the Bill’s origins, according to Mr. Enns, the goal was to provide consistency so that the state trademark laws across the United States are based on the same trademark laws and protections offered by the Lanham Act, and “so that we didn’t have an inconsistent regime across the country.”
Over the years, the Model State Trademark Bill has been subject to minor revisions to reflect important changes in trademark law and policy in the United States. The amendment in 2007, which Monday’s action supersedes, was to make the Bill consistent with changes to the Lanham Act implemented by the Trademark Dilution Revision Act of 2006.
Since 2007, there have been material developments in U.S. trademark law, including amendments to the Lanham Act, as well as U.S. Supreme Court rulings that cover certain provisions of the Lanham Act that are inconsistent with protections of the U.S. Constitution.
As Mr. Enns explained, the time had come to amend the Bill with several key updates to provide policymakers with the most up-to-date guidance to reflect these pivotal developments in trademark law and policy.
A Respected Voice
He opined that INTA is singularly positioned to present such revisions, noting: “My experience is that INTA is the most respected voice on trademark policy in the United States. The Association is laser-focused on trademarks, and as a result of its very active advocacy on Capitol Hill on federal issues, it has carved itself a unique niche as the most credible voice for trademark policy in the country.”
Mr. Hogan commented: “The entire purpose of the legislation is to help lawmakers work through issues that are going to be of importance to the trademark field. INTA was, by any measure, remarkably successful in promulgating this in the first place. We are returning to the guidance because these bills periodically need updating.”
After evaluation and discussion of the working group’s report, the full U.S. Subcommittee of the Legislation and Regulation Committee voted on July 12 to support the proposed changes to the Model State Trademark Bill.
Mr. Enns emphasized: “The goal of the revisions was to take what had been built over decades, to build on that, and bring it forward another decade to make it consistent with the state of law today, while retaining the original framework.”
Mr. Hogan added: “We advocated adding language that parallels language that has been added to the Lanham Act, and second, we wanted to ensure the Bill conformed to U.S. Supreme Court guidance on how the Lanham Act should be interpreted and which parts are unconstitutional.”
“When INTA comes together and achieves model trademark guidelines, and this Model Bill is just one example, we speak with a unique voice because of our constituency.”
Roderick J. Enns, Enns & Archer (US)
Six Key Updates
The latest resolution provides six key updates. The first update is the “Removal of Bar on Registration of Immoral or Scandalous Marks.” This follows the Supreme Court’s decision in Iancu v. Brunetti, 139 S. Ct. 2294 (2019), in which the Court held that the Lanham Act’s ban on the registration of “immoral” or “scandalous” trademarks discriminates on the basis of viewpoint and violates the First Amendment.
The change removes the language in Section 2 (Registrability) of the Model Bill, indicating that marks consisting of or comprising “immoral” or “scandalous” matter shall not be registered.
Similar to the first change, the second update, the “Removal of Bar on Registration of Disparaging Marks,” deletes from Section 2 (Registrability) the language indicating that matter that may “disparage persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt or disrepute” shall not be registered. This is consistent with the Supreme Court’s decision in Matal v. Tam, 137 S. Ct. 1744 (2017) which found that such language in the Lanham Act violates the First Amendment.
The third update involves the “Removal of Willfulness Requirement for Recovery of Profits or Damages.” The change eliminates from Section 12 (Infringement) the provision that “the registrant shall not be entitled to recover profits or damages [under subsection (b) of the Infringement section] unless the acts have been committed with the intent to cause confusion or mistake or to deceive.”
The change conforms the Bill to the standards under the Lanham Act as articulated in the Supreme Court’s decision in Romag Fasteners, Inc. v. Fossil, Inc., 140 S. Ct. 1492 (2020), which held that willfulness is not an absolute prerequisite to a profits award in Lanham Act trademark infringement cases.
The fourth update sees the “Addition of Functionality as Basis for Denial of Registration and Cancellation.” It amends Section 2 (Registrability) to add functionality as a basis for denying registration and amends Section 9 (Cancellation) to provide that a registration shall be canceled if a court of competent jurisdiction finds that the mark is functional.
As Mr. Hogan observed, this update was prompted by Supreme Court rulings on functionality, which had led to confusion and a lack of uniformity in U.S. state courts.
“The Supreme Court introduced the functionality concept when it was wrestling with the protection of trademarks outside of the traditional names and logos, categories of trademarks and trade dress categories,” he explained. “Courts interpreting those decisions have been wrestling with functionality ever since, so we were motivated by the dilemma faced by state courts that were struggling with this question, and we tried to provide guidance.”
Mr Enns added: “We were working on the very fundamental question of whether a state court should be looking at all at the topic of functionality as a basis for the refusal of trademark protection. The answer is ‘yes,’ but until now there was no guidance in the state bill to reflect that.”
The fifth update is the “Addition of Nominative Fair Use Exception to Dilution Liability,” amending Section 13 (Injury to Business Reputation; Dilution) to provide that nominative fair use of a famous mark shall not be actionable under dilution law.
Lastly, the sixth update, the “Addition of Rebuttable Presumption of Irreparable Harm,” amends Section 14 (Remedies) to provide that a plaintiff seeking injunctive relief is entitled to a rebuttable presumption of irreparable harm when the court finds a violation or a likelihood of success on the merits in proving a violation.
This language is parallel to that added to the Lanham Act by the Trademark Modernization Act of 2020. The INTA Board passed a Resolution on May 20, 2017, in favor of amending the Lanham Act to include such a presumption.
These updates will ensure that the Bill will continue to provide many more years of guidance and support for trademark administrators and state legislatures, the Subcommittee members said.
“When INTA comes together and achieves model trademark guidelines, and this Model Bill is just one example, we speak with a unique voice because of our constituency,” Mr. Enns said.
“INTA’s voice carries significant weight in terms of identifying trademark issues and evaluating how to address those, and to bring about proper policies to address them. Our voice really matters.”
Video courtesy of Adobe Stock / Iakov Kalinin
Friday, November 19, 2021
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