Can COVID-19 Provide a Sufficient Basis for Claiming Excusable Nonuse of a Trademark?

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As others have previously reported, the US Patent and Trademark Office (USPTO) has taken the position that the COVID-19 pandemic constitutes an “extraordinary situation” warranting suspension of certain rules relating to trademark filings, namely, the waiver of certain fees associated with the revival of abandoned or cancelled marks. In addition, the effects of COVID-19 may also provide a sufficient basis for claiming “excusable nonuse” of a trademark.

Under US law, trademark rights are based on use. Thus, if an owner ceases use of a trademark for a sufficiently long period of time, the owner’s rights may become vulnerable to third-party claims that the owner has abandoned the mark. With respect to maintaining federal trademark registrations, the law requires that trademark owners periodically file declarations of continued use with the USPTO (between the 5th and 6th years following registration and every 10th anniversary of registration). 15 U.S.C. §1058. However, if the trademark is not in use at the time of the required filing, owners have the option of claiming that the nonuse is excusable for certain reasons.

The circumstances considered by the USPTO to constitute “excusable nonuse” are very limited. However, illness, acts of God, and other events outside the owner’s control are specifically named as qualifying circumstances. TMEP § 1604.11; In Re New England Mut. Life Ins. Co., 33 USPQ2d 1532 (Com’r Pat. & Trademarks 1991). Moreover, while it is within the USPTO’s discretion to determine whether circumstances constitute excusable nonuse, “the standard is not overly strict.” 5 Gilson on Trademarks § 27.03 (2019).

It therefore stands to reason that the USPTO would consider a trademark owner’s temporary nonuse of a trademark due to COVID-19 to be excusable. That said, the owner would be required to explain in sufficient detail how the outbreak affected the owner’s business (e.g., illness of numerous employees, government mandate that stores be closed, etc.) and outline plans and an expected timeline to restore production. Moreover, the owner would need to resume use of the trademark within a reasonable time following the end of the pandemic. McCarthy on Trademarks and Unfair Competition § 17:16. The owner’s temporary nonuse of its mark would also likely be sufficient to rebut a third-party claim that the owner has abandoned its mark. Id.; see also Miller Brewing Co. v. Oland's Breweries Ltd., 548 F.2d 349, 352 (C.C.P.A. 1976) (acknowledging “abandonment does not result from a mere temporary withdrawal from the market forced by outside causes”).

Finally, trademark owners must be mindful that, although COVID-19 likely provides a basis for claiming excusable nonuse of a trademark, the owner still must file a declaration of such nonuse with the USPTO. Failure to file a declaration explaining the excusable nonuse will result in cancellation of the owner’s trademark registration.