Earlier this month, I had the pleasure of speaking on a panel for the ABA IP Law Section Spring Meeting on international trademark infringement litigation. Our panel particularly highlighted the process for obtaining “preliminary injunctions” in the various jurisdictions. (Preliminary injunctions are fast-moving proceedings in which a Court may order the infringing party to temporarily stop their infringement while the matter is being fully litigated – there is a high bar to getting these for obvious reasons.) Because, in my experience, clients often elect not to pursue a preliminary injunction (or may not always have the facts to support it – for example if the infringement had been going on for a while and was unknown to the client for that time), I thought it important to provide some wider strategic context on the subject under US law. Here are some of the top takeaways from my presentation.
Is your trademark registered? This will affect your options.
If the mark being infringed is not registered, that can impact the options available to the trademark owner. You can still file suit in federal court for infringement of an unregistered mark under the Lanham Act (the Federal trademark law; 15 U.S.C. § 1125(a)), but some potentially effective non-litigation options like filing a complaint with an on-line third-party (such as Google or Amazon if you are in their brand registry) or with the U.S. Customs and Border Protection Bureau may be foreclosed and/or harder to utilize because of the higher levels of documentation required. In addition, if you are dealing with counterfeit products, you will not be able to pursue an “ex parte” seizure remedy unless you have a trademark registration (ex parte means without giving notice to the infringer – which can be extremely important if you are trying to obtain the infringing goods before they can be moved or destroyed). Also, often there may be a challenge brewing in the US Trademark Office if the alleged infringer is trying to register their infringing mark. Especially in those cases it is very important to file an application to register the client’s trademark right away.
Think carefully before sending a cease and desist letter
I know that many other lawyers like to send cease and desist letters routinely as a first step when their client’s mark is infringed. While there are many circumstances in which I, too, will take this measure for trademark infringement, from time to time I prefer to file a complaint in federal court first, but not serve it on the defendant. Then, I will send a “courtesy” copy (a misnomer if I’ve ever seen one) to the other party (or their lawyer if we know who it is) with an invitation to discuss an amicable resolution of the dispute. (In federal court, you have 90 days in which to serve the complaint – and until it is served, the case does not move forward before the court.) I do this especially in cases where I feel the infringer will not take a letter seriously (for example if there have already been prior communications between the client and the infringer or the infringer is a repeat or clearly deliberate offender) and/or where I am concerned about the infringer filing a suit first (for a declaration that they do not infringe) in a jurisdiction that I do not think will be a good fit for our case. One thing I found interesting was that in some foreign countries, cease and desist letters are required, while in others they can expose the sender to potential liability if their claim is not found valid. Here in the U.S., the main risk (other than being ignored or ending up in a court not of your choice) would be if you chose to send the cease and desist letter to someone’s customers – if you are not on solid ground you could open your client to a tortious interference with business relationships claim.
Consider filing a proceeding or Letter of Protest in the US Trademark Office
One of the first ways a client often discovers a potential infringer exists is when they or the alleged infringer tries to register a trademark in the US Trademark Office. In that situation, a client has a number of options to try to prevent the registration (or seek to cancel it if the registration already issued). If the application is still pending before the Trademark Examiner, one can file a “Letter of Protest.” Historically, this was an informal procedure; however, with the 2020 Trademark Modernization Act (“TMA”), that process has been formalized and the USPTO has issued some tips for effective Letters of Protest. Once the trademark application has been allowed or registered, traditional “inter partes” or adversarial proceedings before the USPTO Trademark Trial and Appeal Board (“TTAB”) are available, namely, an “opposition” or “cancellation” respectively. In addition, the TMA also created two new non-adversarial post-registration proceedings, namely expungements and re-examinations.
The grounds for these various proceedings would take up a whole blog post – but for strategic reasons, one should think carefully about whether to file them and, even if they are filed, whether to move forward with them rather than also file a suit in federal court. This decision does not need to be made immediately and very often opposition and cancellation proceedings are resolved amicably early on (for example with a “co-existence” agreement), without the need for further proceedings in the TTAB or federal court. But if the matter does not amicably resolve quickly, then one must think about whether merely preventing or cancelling the registration of the mark is enough, as that is all that can be addressed in the TTAB. If you want to stop the infringement or recover damages for past infringement, you need to go to federal court. If you have decided both proceedings should be filed (which is often the correct choice), you then need to think about whether both proceedings should move forward simultaneously or whether one should be stayed and, further, if it should be stayed, which matter to stay. This issue is particularly important because TTAB matters have limited “preclusive effect” – in other words, certain issues decided by the TTAB may not be relitigated in a district court case involving the same parties but others can be (or are just not addressed in the TTAB). In addition, TTAB matters can be appealed de novo (basically, a “do over”) to the district court, so it could mean that you are ending up relitigating the entire matter in federal court anyway. For these reasons, and because a case in district court can encompass all the issues the TTAB matters can cover, as well as infringement, it usually is the one to proceed while the TTAB matter is stayed, although there are situations when it makes strategic sense to do it the other way.
So, should you go for a preliminary injunction (or another fast-moving proceeding)?
Assuming you have decided to proceed in federal court and that you have found out about and are filing suit on the infringement promptly, should you file for a temporary restraining order (a very quick initial proceeding that is theoretically ex parte although all judges like you to have tried to reach out to the other side) and/or a preliminary injunction? Like many answers in law, that depends. In a lot of cases, it will be enough to simply file the case to get the other side to the table (see above – sending a courtesy copy of the filed complaint with an invitation to talk) – and if one is moving forward with a preliminary injunction, there really might not be time to talk. Also, at times the client may not need the relief that urgently. But perhaps one of the most important considerations is how available is your client and how committed to participating in the litigation process are they? If the client has many other more pressing matters in their business, it might not be a good idea to have a fast-moving case that requires quick turn-around time on requests from lawyers and a significant investment of client time on case matters in a short period of time.
Also, if budget is an issue, I find that preliminary injunctions – like any fast proceedings – can make the matter more costly overall (even if the case might end more quickly depending on the outcome – but it doesn’t always), as you do not have as much time to stage your case preparation and thus make more strategic decisions about what avenues to pursue and what to let go. If your case is moving fast, you often have to do everything and all at once. For about 15 years, since the Supreme Court’s decision in eBay Inc. v MercExchange, LLC, 547 U.S. 388 (2006), preliminary injunctions also became extraordinarily difficult to get. Historically, there had been a presumption in trademark cases that infringement caused “irreparable harm” – in other words – damage to the trademark owner that would not be fully compensable by damages. The eBay case did away with that presumption. But, in 2020, in the TMA, Congress reinstated the presumption and so that may open up more opportunities for getting preliminary injunctions than before.
Lastly, in thinking about a quick proceeding that stops infringers in their tracks (like a preliminary injunction), in an appropriate case, one should also consider bringing a proceeding in the International Trademark Commission (“ITC”). While patents infringement cases are likely the most well-known type of IP cases heard by the ITC, there have been some well publicized instances of the use of ITC proceedings in trademark matters, such as by Crocs. In addition to the speed with which ITC cases move, they are also beneficial because they stop infringing goods at the border and can be used against unknown foreign defendants (because the jurisdiction is over the goods, not the infringer). These cases tend to be very expensive, however, and required counsel versed in both ITC matters as well as IP, due to the unique requirements (such as market impact) that must be shown and special procedures followed in ITC matters (although you can file a complaint like in federal court, the ITC decides for itself whether to take the case).
You have many options to consider
In short, there are a lot more options for remedying trademark infringement than there are for many other types of IP matters, including some we haven’t even discussed here, like going into state court to pursue an infringement claim (although I believe most IP lawyers would prefer federal court for various reasons) or whether there is also infringement internationally that needs to be addressed. Many of these options can and should be used in combination. The decision on which strategy to pursue is complex and requires consideration of various legal factors such as whether and where you can get jurisdiction over the infringer, whether and where your mark is registered, whether the infringer is trying to or already has registered their mark, and whether you can make a case for a preliminary injunction. You must also consider practical ones such as whether a simple takedown of the infringing mark or infringing product through a third-party like Google or Amazon might be available and adequate to meet the client’s needs, as well as client availability, budget and strategic goals. In addition, like in any case, one needs to consider things like the size and litigiousness of the party on the other side. Since there are no absolute right answers or once size fits all approaches to trademark infringement litigation, it ultimately takes a combination of business and legal judgment to arrive at the appropriate strategy in a particular case.