The New Trade-Mark Act and Its Importance to the Chemical Industry

Nov 5, 2010 - No trade-mark owner can afford not to register all unregistered marks now in use and to take advantage of benefits conferred by the new ...
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The New Trade-Mark Act and Its Importance to the Chemical Industry J O S E P H ROSSMAN,

1820 Jefferson Place, X. \Y„ Washington 6, D. C.

I m p o r t a n t property r i g h t s a n d sole right to u s e i n c o m m e r c e h a v e b e e n established in t h e n e w trade-mark act . . . N o t r a d e - m a r k o w n e r c a n afford n o t t o register all u n r e g i s t e r e d m a r k s n o w in u s e a n d t o take a d v a n t a g e o f benefits conferred b y t h e n e w act i n c o n ­ nection with marks already registered X HE new federal lU-Ιϋ trade-mark act (Public Law 4S9, 79th Congress) went into effect July 5, 1947. All previous trade­ mark registration acts are repealed. T h e new act is basically i m p o r t a n t legislation to manufacturers because it grants to trade-mark registrants nationwide express rights of ownership as well a s the sub­ stantive right to use the registered marks in commerce. The registered trade-mark is protected against unfair competition from modern business viewpoint as iden­ tification of source or origin of the goods or services involved, also as a, symbol of reputation, good will, and guarantee of quality. Important p r o p e r t y rights in marks are t h u s established u n d e r the new act. Furthermore, the act codifies the basicrules of fair trading in relation to use of marks in commerce which the federal courts are under m a n d a t e to enforce. T h e act stresses business integrity, legiti­ mate trading and protects good will against spoliation by unfair trade prac­ tices. Function

of

Trade-Marks

Trade-mark designations h a v e become important symbols of trade communica­ tion both in our private a n d technical lives. It would be inconvenient and troublesome to purchase desired specificgoods without being able to order them bv an identifying trade-mark. I n fact, some trade-marks have been wholly absorbed by t h e English language as generic names for identifying new products, such as cellophane, aspirin, and linoleum. We can hardly read a technical journal today without encountering numerous references to trade-mark designations in the technical articles. M a n y chemical p a t e n t s issued in recent years refer to trade-marks for identification of the ingredients used. 1 Chemical manufacturers h a v e been especi­ ally aware of the value of t r a d e - m a r k s as 1 T h e current practice in the P a t e n t Office pro­ hibits the use of trade-marks in patent applica­ tions. The use of " t r a d e - n a m e s " (i.e., t h e name by which an article is called in commerce and is not indicative of the origin or source of the ar­ ticle, for example "cream of t a r t a r " ) is permis­ sible in patent applications if (1) their meanings ••re established by an accompanying definition which is sufficiently precise a n d definite to be made part of a claim, or (2) in thus country their meanings are well known and satisfactorily de­ fined in the literature.

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the most constant, active, and extensive salesmen, reaching, so to speak, over the seller's shoulders to offer the manufac­ turer's goods to the consumer. T h e y represent tremendous investments in ingenuity, advertising, and pe'-severence. They stand as the manufacturer's com­ mercial autograph and guarantee to the consumer. They are the quality insignia of the manufacturer. The Supreme Court recently said: "Λ trade-mark is a merchandising short cut which induces a purchaser to select what he wants, or what he has been led to be­ lieve he wants. . . . Whatever the means employed, the end is the same—to convey through the mark, in the minds of po­ tential customers, the desirability of the commodity upon which it appears." Trade-marks today denote not only source or origin of goods to which they are applied but also symbolize the good will of the manufacturer. T h e y a r e a manufacturer's commercial signature and a guaranty to the consumer that the goods bearing it will give him the same satis­ faction or the same service which other goods bearing this m a r k have previously given him. Trade-marks t h u s have an important advertisement or sales function serving as a sort of guaranty of ''identity of quality" for goods bearing the mark. Trade-mark rights originated with the growth of our mercantile system starting several centuries ago. I t took a long evolutionary judicial a n d legislative history before trade-mark* rights were recognized as having a legal s t a t u s similar to tangible physical property which the courts would enforce against pirates, imitators, and unfair traders. In m a n y previous cases the judges often felt t h a t justice required giving relief to trade-mark owners, but they had no legal a u t h o r i t y under the common law to do so. Consequently m a n y state and federal statutes were enacted to give relief. With the growth of interstate commerce the federal statutes have assumed primary importance to manufacturers. The existing principal federal trade-mark registration statutes enacted in 1881, 1905, and 1920, however, have been found to be inadequate in many situations to trade-mark owners, especially in t h e failure of the statutes to establish C H E M I C A L

a clear right to use the mark exclusively throughout the United States. T h e new act marks an i m p o r t a n t advance by granting to trade-mark registrants express rights of ownership as well as the right to use in commerce which t h e previous acts did not give. T h e new act thus grants the exclusive right to use a mark throughout the United States in interstate commerce as a property right to registrants. T h e registration certificate is in effect a deed to the owner­ ship of the mark. Registration u n d e r the new act creates very important substan­ tive trade-mark rights and remedies against infringers and imitators. T h e act has real teeth in it so t h a t a manufacturer will he able to get a d e q u a t e and full relief a n d damages caused by unfair acts of a competitor. T h e new riglits u n d e r the act are so far-reaching and valuable t h a t no trade-mark owner can afford n o t t o acquire all the benefits by registering all unregistered marks now in use or taking advantage of the benefits conferred by the new a c t a s may be appropriate in con­ nection with marks already registered. Types

of Marks

Registrable

The following marks as defined in Sec. 4 5 are registrable under the new a c t : Technical Marks. Any word, name, s y m ­ bol, or device or any combination thereof adopted and used by a m a n u ­ facturer or merchant to identify his goods and distinguish them from those manufactured or sold by others. Ex­ amples are coined and arbitrary marks such as Cellosolve and Carbitol. Service Marks. A m a r k used in the sale or advertising of services to identify t h e services of one person and distinguish them from the services of others and in­ cluding without limitation the m a r k s , names, symbols, titles, designations, slogans, character names, and distinctive features of radio or other advertising used in commerce. Examples are com­ mercial laboratory marks, laundry marks, railroad marks, musical signa­ tures o n the radio. Certification Marks. A mark used upon or in connection with the products or services of one or more persons other than t h e owner of t h e mark to certify regional or other origin, material, mode of manufacture, quality, accurac}' or other characteristics of such goods or services or t h a t t h e work or labor on t h e goods or services was performed b y members of a union or other organiza­ tion. Examples: Underwriters 7 Labo­ ratories' seal, Α Μ Α approval mark, Good Housekeeping mark. Collective Marks. A trade-mark or serv­ ice mark Used b y t h e members of a co­ operative, association, or other collective group or organization and includes marks used t o indicate membership in a union, a n association, or other organization. A N D

ENGINEERING

NEWS

Under this group are included marks to certify regional origin such as Idaho p o ­ tatoes, M o h a w k Valley apples, Sheffield steel. Collective and certification marks, in­ cluding indications of regional origin, a r e registrable only if the applicant exercises Legitimate control over the use of the m a r k s even though not possessing an industrial or commercial establishment. Provisions are m a d e for registering con­ currently lawfully used trade-marks t o more t h a n one registrant if it can be established t h a t n o confusion, mistake, or deceit of purchasers is likely to result u n d e r conditions and limitations as to the mode or place of use or the goods on which t h e m a r k is used as m a y be p r e ­ scribed by the P a t e n t Office. For the purposes of this act a m a r k is deemed to be used in comtnerce (a) on goods when it is placed in a n y manner on the goods or their containers or the dis­ plays associated therewith or on the tags or labels affixed thereto and the goods a r e sold or t r a n s p o r t e d in commerce a n d (h) on services when it is used or displayed in t h e sale or advertising of services a n d the services are rendered in commerce. T h e act (Sec. 2) also directs the P a t e n t Office not to refuse registration of a t r a d e - m a r k by which the goods of* an a p ­ plicant m a y be distinguished from t h e goods of others unless it (a) comprises immoral or deceptive matter, or m a t t e r which may disparage or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring t h e m into contempt, or disrepute; (b) comprises the flag or coat of a r m s of the United States, any state, municipal­ ity, or a n y foreign nation; (c) comprises a name, portrait, or signature identifying a particular living individual except b y his written consent, or the name, signa­ ture, or portrait of a deceased President of t h e United S t a t e s during the life of his widow, if any, except by the written consent of the widow; (d) comprises a m a r k which so resembles a mark regis­ tered in the P a t e n t Office or previously used in t h e United States by another a n d not a b a n d o n e d as to be likely to cause confusion or mistake or to deceive p u r ­ chasers; (e) consists of a m a r k which, (1) when applied t o the goods of the a p ­ plicant is merely descriptive or decep­ tively misdescriptive of them, or (2) is primarily geographically descriptive or deceptively misdescriptive of them, except a s indications of regional origin which m a y be registrable under the act, or (3) is primarily merely a s u r n a m e . **Distinctive"

original geographic o r descript ive meaning. Such well-known n a m e s as, for instance, "Philadelphia C r e a m Cheese," or "CocaCola," or " F o r d " a n d innumerable others were not registrable under t h e old law unless t h e y came within the exception of the so-called 10-year proviso of Section δ of the 1905 act requiring proof of a 10year exclusive use prior t o the year 1005. Any exclusive use of such secondary meaning t r a d e - m a r k s for a period even exceeding 10 y e a r s b u t commencing after 1895 is not a basis for registration under t h e old act of 1905 with the result that innumerable n a m e s which have be­ come famous since 1905 despite some in­ cipient weakness could never satisfy the requirements of t h e a c t ancl could be registered, if at all, only under the a c t of March 3, 1920. T h i s 1920 act, however, did not v e s t m a r k s registered u n d e r it even with a prima facie presumption of validity. T h e owners of h u n d r e d s of nationally known t r a d e - m a r k s have thus been compelled to rely on common law remedies against unfair competition in order to obtain relief against infringers. T h e n e w act effectively takes care of this situation by providing in Section 2(f) for the registration of a n y m a r k ''which has become distinctive of the applicant's goods used in c o m m e r c e . " Substantially exclusive a n d continuous use of a m a r k for five years preceding the date of the ap­ plication m a y be accepted as prima facie evidence of the m a r k ' s distinctiveness by the Commissioner of P a t e n t s . Trade Names

and Commercial

Trade-Marks

2 5,

NO.

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* DECEMBER

Supplemental

Trade-Mark

Register

T h e marks previously discussed will b e registered in the principal register in t h e P a t e n t Office; b u t a supplemental regis­ t e r is also provided for all m a r k s capable of distinguishing a p p l i c a n t ' s goods o r services and not registrable on t h e p r i n ­ cipal register, except those prohibited u n d e r Section 2 of t h e act, which h a v e been used for o n e y e a r in commerce b y t h e proprietor thereof. . Such m a r k m a y consist of a n y t r a d e - m a r k , s3 r mbol, label, package, configuration of goods, n a m e , word, slogan, phrase, s u r n a m e , geographi­ c a l name, n u m e r a l , or device or any com­ bination of any of t h e foregoing, b u t such m a r k must be capable of distinguishing t h e applicant's goods or services. Such registered marks are not subject t o opposition prior to registration but a r e subject to cancellation proceedings a t a n y time after registration. T h e type of marks registrable under t h e supplemental register is of vast scope a n d of great importance to m a n u f a c t u r e r s . Distinctive label a n d p a c k a g e designs, s h a p e s , ancl c o n t o u r s are registrable. T h e color a n d dress of a p a c k a g e can b e registered as a trade-mark. Slogans a n d catch-phrases are registrable. After five y e a r s use of such m a r k it can be regis­ tered on the main register under Section 2(f) a n d thereby still greater r i g h t s are a c ­ q u i r e d such a s incontestability and p r i m a facie evidence of exclusive r i g h t to use. T h e rights obtained by registration on t h e supplemental register are not a s g r e a t a n d differ considerably from the i m p o r t a n t rights which are secured when a m a r k is registered on the principal register. It is important t o n o t e t h a t m a r k s on t h e supplemental register (a) are not p r i m a facie evidence of the registrant's owner­ ship; (b) a r e n o t constructive notice of t h e registrant's claim of o w n e r s h i p ; (c) m a y n o t become incontestable; (d) m a y b e canceled a t a n y t i m e at t h e instance of a n y person who believes h e is or will b e damaged; (e) m a y not be involved in interference; (f) m a y not like registrations o n t h e principal register be filed in t h e T r e a s u r y D e p a r t m e n t or b e used to s t o p importations. CPjpposi tions, Ca ncellations, and Interferences Oppositions, cancellations, a n d inter­ ferences will be generally similar to t h e old practice except t h a t no cancellation can b e filed five years after registration occurs on t h e principal register, b u t a registra­ tion can be canceled at any time [Sec. 14(c) and (d)] if t h e registered m a r k becomes the common descriptive n a m e of a n article or s u b s t a n c e or h a s been a b a n ­ d o n e d , or t h e registration h a s been o b -

T h e prior laws failed to provide for t h e registration of trade-marks which despite a n original weakness or defect may h a v e acquired a widely recognized "secondary m e a n i n g " t h a t for all practical purposes t h e public h a s come to accept as h a v i n g t r a d e - m a r k significance rather t h a n t h e V O L U M E

Names

T h e t e r m s "trade n a m e " and "commer­ cial n a m e " include individual names and surnames, firm n a m e s , a n d t r a d e names used by m a n u f a c t u r e r s , industrialists, mer­ chants, agriculturists, a n d others to iden­ tify their businesses, vocations, or occupa­ tions; the names or titles lawfully adopted and used b y persons, firms, associations, corporations, companies, unions, and any manufacturing, industrial, commercial

agricultural, or olher organizations e n ­ g a g e d in trade or commerce and capable of suing and being sued in a c o u r t of law. T h e s e are protected under the act w i t h o u t t h e obligation of filing registration w h e t h e r o r n o t they form p a r t s of m a r k s .

8,

1947

3641

t a i n e d fraudulently, or if the registered m a r k has been assigned a n d is being used by, or with the permission of, the assignee so as to m i s r e p r e s e n t t h e source of t h e goods or services in connection with which the mark i s used, or in the case of a certi­ ficat ion mark o n the ground t h a t the regis­ trant (J) does not control, or is n o t able legitimately to exercise control over, t h e use of such mark, o r (2) engages in t h e production or m a r k e t i n g of a n y goods or services t o which t h e m a r k is applied, or (3) permits the use of such m a r k for other purposes t h a n as a certification mark, or (4) discrimmately refuses to certify or to continue t o certify the goods or services of a n y person who maintains the s t a n d ­ ards or conditions which such m a r k certifies. T h e Federal T r a d e Commission is given the power to file cancellation proceedings a t a n y time on the same grounds available to a private p a r t y a t any time as provided in Section 14(c) and (d) a s outlined above. Trade-Mark

JMarhing

Required

Section 29 a p p r o v e s t h e following t y p e of marking: " R e g i s t e r e d in I ' . S. P a t e n t Office" o r " R e g . U . S. P a t . Off." or t h e letter It enclosed within a circle, t h u s (ft); aiul-in any suit for infringement under this act b y such a registrant failing so to m a r k goods b e a r i n g the registered m a r k , or b y a registrant under the act of March 19, 1920, or by t h e registrant, of a m a r k on the supplemental register no profits a n d no damages can be recovered unless t h e defendant has been given actual notice of the registration. T h e approved m a r k i n g of goods bearing a registered m a r k serves as a u t o m a t i c notice to any infringer from t h e d a t e actual, in­ fringement commences. Term oj" Registration Five-Year /ijjidavit

and Reports

The t e r m of a t r a d e - m a r k registration Is 2 0 years a n d can be renewed for a d d i ­ tional like periods, but an affidavit of use m u s t b e filed in the P a t e n t Office five years after registration to indicate t h e m a r k is still in use or i t s nonuse is d u e to special circumstances which excuse its noriusc w i t h o u t intention t o a b a n d o n the mark. Otherwise the registration will be canceled by the P a t e n t Office a t the end of six years. Regist ra tio η

Fees

The filing fee for a t r a d e - m a r k regis­ tration application has been increased to $ 2 5 . T h e fee for publication of a previ­ ously registered m a r k u n d e r t h e new act t o obtain t h e benefits of t h e new act is $10. Incontestability A v e r y v a l u a b l e feature of t h e new a c t is provided i n ' S e c t i o n 15 u n d e r which a trade-mark registration becomes incon­ testable after five y e a r s ' continuous use subject to certain specified exceptions

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stated in t h e a c t . We will p r o b a b l y see a great deal of misleading literature p u b ­ lished in t h e near future regarding this " i n c o n t e s t a b i l i t y " provision. P e r h a p s t h e use of this word in t h e a c t is u n f o r t u n a t e because no trade-mark right can become absolutely incontestable under all possible circumstances. W h a t t h e new a c t really a t t e m p t s t o do is to codify and restate the rules crystallized by the Courts cover­ ing situations in which the validity of a t r a d e - m a r k cannot be challenged. What the ''incontestability" provision a m o u n t s to is t h a t if a registered t r a d e - m a r k is a good valid mark a n d is not subject to any defects or h a s been improperly used as specified in the act, it will not be subject to a t t a c k . Before a registration becomes incon­ t e s t a b l e / a n affidavit m u s t be filed in the P a t e n t Office s t a t i n g t h a t (1) t h e m a r k has been i n continuous use in commerce for a period of five years s u b s e q u e n t to t h e registration date or republication d a t e , (2) there h a s been no final decision adverse to t h e registrant's claim of ownership of s u c h mark, o r the right to register same, or to k e e p it o n the register, (3) there is no a d v e r s e proceeding pending in t h e P a t e n t Office or in a court involving the mark not finally disposed of. However, an incontestable registration can be a t ­ t a c k e d at any t i m e : (1) if the registration was obtained fraudulently, (2) if t h e m a r k has been abandoned, (3) if a n assignee of the m a r k misrepresents the source of t h e goods or services in connection with which the m a r k is used, (4) if the m a r k is de­ scriptive and is used b y the alleged in­ fringer fairly t o describe the goods or their geographic origin, (5) if t h e m a r k was adopted w i t h o u t knowledge of registrant's prior use and used in a specified area, (6) if t h e mark h a s been or is being used to violate t h e a n t i t r u s t laws of t h e United S t a t e s , (7) if the m a r k consists of or com­ prises matters prohibited from registration u n d e r t h e act. F u r t h e r m o r e , in t h e case of certification m a r k s , additional grounds for a t t a c k i n g the "incontestable' ' r i g h t m a y be a d v a n c e d as previously outlined as basis for cancela­ tion a t a n y time. Obviously the " i n c o n t e s t a b i l i t y " of a registered mark is a very restricted right, b u t nevertheless to t h e extent t h a t it can be secured under t h e act, it should prove to b e valuable to manufacturers. Fur­ t h e r m o r e , it must be remembered t h a t ''incontestability" will arise only in t h e future, t h a t is, five years after registra­ tion. Any rights so acquired h a v e a prospective rather t h a n a retroactive effect, especially since t h e act expressly provides (Sec. 49) t h a t " n o t h i n g herein shall adversely affect t h e rights or t h e enforcement of r i g h t s in m a r k s acquired in good faith prior t o t h e effective d a t e of this a c t . " U n d e r the old a c t of 1905 cancellation proceedings could be brought a t a n y time on the ground t h a t t h e m a r k should not

CHEMICAL

h a v e been registered because of its alleged geographical, descriptive, or otherwise defective c h a r a c t e r or because it was in conflict with a n o t h e r identical or similar m a r k a t t h e t i m e of t h e filing of t h e original application. Under t h e old law a manufacturer w h o m a y have spent mil­ lions in popularizing his trade-mark had no assurance t h a t his registration would be i m m u n e from a t t a c k o n such technical reasons a s descriptiveness, being merely a surname, etc. F o r t u n a t e l y such p r o ­ ceedings did n o t finally adjudicate t h e right to use the m a r k so that in a sense cancellation proceedings were often mock a s well a s expensively futile legal battles. U n d e r t h e new a c t a competitor will n o t be able t o defeat the rights of the owner of a registered t r a d e - m a r k after the expira­ tion of t h e five-year period by showing t h a t the m a r k w h e n initially registered was in conflict with t h e competitor's rights. T h e m o s t t h a t such competitor could ask for u n d e r the new a c t would be a court decree permitting him to use the m a r k in the limited local territory i n which h e m a y h a v e actually used it in good faith prior to t h e registrant. Use by "Relat&d99 and Licensing

Companies

An i m p o r t a n t a n d valuable feature is provided in Section 5 of t h e a c t which permits the u s e of a p a r e n t c o m p a n y ' s t r a d e - m a r k by its " r e l a t e d " companies. T h e p r e v i o u s d a n g e r t h a t exclusive rights t o t r a d e - m a r k s were destroyed b y granting m a n u f a c t u r i n g licenses or per­ mitting use of a t r a d e - m a r k b y distributing subsidiaries is n o w eliminated a s long as no deception of the public or restraint of trade m a y result from such practices. I t will t h u s be possible under t h e act for a holding p a r e n t or control company to apply a n d secure registration of a trade­ m a r k owned b y it but primarily used by one of its subsidiaries. Subsidiaries a n d licensees t h e m s e l v e s , however, will not be able to register marks controlled by t h e parent c o m p a n y . Assignment

oj

Trade-Marks

Section 10 of t h e a c t changes the old common law rule t h a t a t r a d e - m a r k could n o t be assigned without simultane­ ous a s s i g n m e n t of the entire business in wrhich it is used. In the absence of de­ ception of the public a n d provided always t h a t such practices are not actually abused for purposes of restraint of t r a d e , a m a n u ­ facturer is n o w free to split up his business either geographically o r with regard to t h e various type of com modi ties produced a n d assign one o r more of his trade-marks separately to those w h o are interested in acquiring e i t h e r production rights limited to one or m o r e lines of production or territorial r i g h t s for a certain designated, area. T h e act n o w expressly legalizes t h e assignment of a t r a d e - m a r k in connection with t h a t p a r t of the good will of the busi-

AND

ENGINEERING

NEWS

η ess in which t h e m a r k is used. I n order t o p r o t e c t t h e public against possible deception, Section 10 specifically provides t h a t a registration m a y be canceled if t h e m a r k is used with or without permis­ sion of the assignor so as to misrepresent t h e source of t h e goods or services in con­ nection with which it is used. Constructive

Notice

The act provides (Sec. 22) t h a t registra­ tion of a m a r k on t h e principal register shall b e "constructive notice of the regis­ t r a n t ' s claim of ownership thereof." No similar provision is found in the old act of 1905. Until now a manufacturer in one p a r t of the country could never be certain de­ spite h i s federal registration t h a t a com­ petitor may not acquire trade-mark rights in the same m a r k even subsequent to the date of registration in a n y territory in which the registrant h a d not actually used t h e m a r k and t h a t regardless of w h e t h e r the competitor used the mark only within one state or between several states. The effect of "constructive notice" under t h e act will be t h a t no one can acquire in good faith trade-mark rights in the registered m a r k subsequent to the d a t e of registration in a n y area of this c o u n t r y not y e t entered b y the registrant which extends beyond the confines of one individual s t a t e . In other words, under this a c t federal registration actually will b e nationwide. Remedies The different remedies under t h e new a c t available t o t r a d e - m a r k owners have been previously touched upon to some extent. T h e federal courts are vested with b r o a d powers to give complete relief against trade-mark infringers and against unfair trading practices. Section 32 pro­ vides: Any person who shall, in commerce (a) use, w i t h o u t t h e consent of the registrant a n y reproduction, counterfeit, copy, or colorable imitation of any registered mark in connection w i t h t h e sale, offering for sale, or advertising of any goods or serv­ ices on or in connection with which such use is likely to cause confusion or mistake or to deceive purchasers as to the source of origin of such goods or services; or (b) re­ produce, counterfeit, copy, or colorably imitate any such m a r k and apply such re­ production, counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers, receptacles, or advertisements intended to be used upon or in connection with t h e sale in commerce of such goods or services, shall be liable to a civil action by t h e registrant for any or all of the remedies hereinafter provided . . . Section 35 further provides t h a t the plaintiff shall be entitled t o : Hecover (1) defendant's profits, (2) any damages sustained by t h e plaintiff, and (3) the costs of t h e action. The court shall assess such profits and damages or cause t h e same to be assessed under its direction. I n assessing profits the plaintiff shall be re­ quired to prove defendant's sales only; defendant m u s t prove all elements of cost V O L U M E

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or deduction claimed. I n assessing dam­ ages the court m a y enter judgment, a c ­ cording t o the circumstances of t h e case for any s u m above the a m o u n t found a s actual damages, n o t exceeding three times such amount. If the court shall find t h a t t h e a m o u n t of the recovery based on profits is either i n a d e q u a t e or excessive, t h e court m a y in i t s discretion enter j u d g m e n t for such sum as the court shall find t o be just, according to t h e circumstances of t h e case. Such sum in either of the above circum­ stances shall constitute compensation a n d n o t a penalty. T h e a c t also expressly forbids false designations of origin a n d false descrip­ tions of goods or services and makes these offenses actionable in a civil suit for damages. Importation Infringing

of Goods Hearing Marks or Names Forbidden

Section 42 provides t h a t no article of imported merchandise which shall copy o r simulate the name of any manufacturer shall be permitted entry into this country. I n order to aid t h e customs officials in enforcing this prohibition, manufacturers should file a copy of their trade-mark registrations in t h e D e p a r t m e n t of t h e Treasury. This information will p u t t h e customs officers o n notice in checking imported goods. International Registrations T h e act (Sec. 44) directs the P a t e n t Of­ fice t o keep a register of all m a r k s com­ municated to it b y the international bur­ eaus provided for by the conventions for t h e protection of industrial property, trade-marks, trade and commercial names, a n d the repression of unfair competition t o which the United States is or m a y b e ­ come a p a r t y , a n d upon the payment of t h e fees required b y such conventions a n d t h e fees therein prescribed m a y place t h e m a r k s so communicated upon such regis­ ter. This register will show a facsimile of t h e m a r k or trade or commercial n a m e ; information on t h e registrant; t h e use of the m a r k and a list of goods or services t o which t h e mark is applied, e t c . This register will be a continuation of t h e register provided in Section 1(a) of t h e a c t of March 19, 1920. Persons who are nationals of, domiciled in, or have a bona fide and effective busi­ ness or commercial establishment in a n y foreign country, which is a p a r t y to (1) t h e International Convention for t h e P r o ­ tection of Industrial Property, signed a t Paris on March 20, 1883; or (2) t h e General Inter-American Convention for T r a d e - M a r k a n d Commercial Protection signed at Washington on F e b . 20, 1929; or (3) a n y other convention or t r e a t y relating t o trade-marks, t r a d e or com­ mercial names, or the repression of unfair competition to which t h e United States is a p a r t y , are entitled to the benefits a n d subject t o the provisions of this act t o t h e e x t e n t a n d under t h e conditions e s ­ sential to give effect to any such conven­ tions and treaties so long as the United S t a t e s shall continue to be a p a r t y thereto.

.DECEMBER

8,

1947

An application for registration of a m a r k under Sections 1, 2, 3, 4, or 23 of the a c t filed by a person described above who h a s previously duly filed an application for registration of t h e same m a r k in one of t h e countries described a b o v e shall be accorded t h e same force a n d effect as would be accorded to the same applica­ tion if filed in t h e United States o n the same date on which the application was first filed in such foreign country, provided t h a t (1) the application in the United States is filed within six m o n t h s from the d a t e on which t h e application was first filed in the foreign country; (2) t h e ap­ plication conforms as nearly as practicable to the requirements of this act, but use in commerce need n o t be alleged; (3) the rights acquired b y third parties before t h e date of the filing of the first applica­ tion in the foreign country shall in no w a y be affected b y a registration obtained on an application filed under this section. A mark duly registered in the country of origin of the foreign applicant m a y be registered on t h e principal register if eligible, otherwise on the supplemental register. T h e application m u s t b e ac­ companied b y a certified copy of the application for or registration i n the coun­ t r y of origin of t h e applicant. Statiis of Prior and. Pending

Registrations Applications

Prior trade-mark registrations (except u n d e r the 1920 a c t ) will remain in force for their full term a n d will also receive a u t o ­ matically after J u l y 5, 1947, a number of new benefits under the new act, particu­ larly as to remedies against infringers. T h e y can also be republished under the new law [Sec. 12(c)] to come under and obtain all the benefits and greater rights u n d e r the new law or can be renewed prior to their expiration u n d e r the pro­ visions of the new act. Thus registrations under t h e 1881 a n d 1905 acts can be re­ newed under the provisions of the new act if i t is desired to maintain such registra­ tions in force. These registrations and their renewals will be subject to a n d are entitled to the benefits of all t h e provisions of t h e new act apptying to marks o n the principal register except t h a t "incontest­ a b l e " rights will n o t be acquired and can­ cellation proceedings can be instituted a t a n y time. Pending applications in t h e P a t e n t Office may be amended now if practicable to bring t h e m under t h e provisions of the new act. Status Act

of Prior 1920 Registrations

Previous 1920 act registrations will expire six months after July 5, 1947, or 20 years from their date of registration, whichever is later. Such 1920 act regis­ trations as long as in force will be subjectto a n d entitled to the benefits of the pro­ visions of the new a c t relating t o the supplemental register and m a y n o t be renewed unless renewal is required to 3643

support foreign registrations [Sec. 4(b)]. However any previously registered mark under an} r act can be registered under the new act if eligible. I t would thus appear t h a t a 1920 act registration if in use for five years will comply with Section 2(f) of the new act as having become distinctive of t h e applicant's goods in commerce and therefore registrable on the principal register. The republication benefits for previously registered marks under Section 12(c) d o not apply to 1920 act registrations. Therefore the 1920 act registrations should be reregistered under the new act before they expire, a n d it would be advantageous to reregister without delay to secure the distinct benefits u n d e r the new a c t . Objectionable

Features

of the

Act

I n some quarters, particularly among the lawyers, criticism has been expressed regarding a number of undesirable features of t h e new act which may be briefly mentioned. Although t h e new act gives the registrant much greater rights than previous acts established, a number of new disabilities are created against him. For example, there is the burden of filing a n affidavit, of use five years after registration to avoid cancellation by the P a t e n t Office. Further, an infringer is given a new defense against the registrant if " t h e mark has been or is being used to violate the antitrust laws." It is not clear whether such defense invalidates t h e entire right to t h e registrant's mark or w h e t h e r the registration can at most be used only as prima facie evidence of the exclusive right to use. This question will ha\ r e to be resolved in ' the courts. E v e r y infringer is t h u s a potential " a n t i t r u s t policeman." T h e Federal T r a d e Commission is given new rights t o initiate cancellation proceedings in the Patent Office as previously explained. This, provision is a s t a r t l i n g innovation in the law which p e r m i t s one government agency to initia t e a proceeding before another governm e n t agency for canceling i m p o r t a n t rights of a private citizen. Certification marks are subject t o cancellation if the registrant discriminately refuses to certify the goods or services of a n y person who maintains the standards or conditions which such mark certifies. T h e restriction on the registrant virtually compels h i m to license anyone who may comply with his standards and apparently no license could be refused under such conditions except a t the risk of cancellation. T h e owners of certification marks m a y t h u s hesitate before deciding to register such marks. T h e names of companies or essential p a r t thereof could not be appropriated u n d e r t h e old law by others for tradem a r k use on a n y goods. However, in t h e absence of possible confusion, mistake, or deceit, no such restriction appears in t h e new act. M a n y companies will

3644

undoubtedly feel this is a serious loss of former rights which might impair or dilute t h e distinctiveness of their company names. Suggested

Steps

to Take ISTow

The new trade-mark act creates important substantive rights in trade-marks arising b y registration. After a registration is issued there can be only one lawful user in commerce. Reliance on common law rights of unregistered m a r k s will b e hazardous since the act codifies w h a t might be termed the federal common law of trade-marks. Therefore it is important for trade-mark owners to review carefully with competent legal counsel all their trade-marks now in active use whether registered or not, their advertising circulars, posters, package get-up or dross, configuration or design of bottles, wrappers, labels, cartons, slogans, phrases, character names, titles, and any other dovices which serve as distinctive d e s i g n a tions of goods being sold. M a n y m a r k s previously unregistered will be registrable under t h e new act if they have become distinctive as applied to any particular goods. The u s e of distinctive emblems, ornaments, decorative wrappers, bottle and container shapes, carton and package designs, numerals, surnames, geographical names o r combinations of these should also be reviewed with a view to possible registration. Owners of registrations granted under the act of March 3, 1881, or t h e act of February 20, 1905, may follow a n y one of five courses: (1) take no action at all until the, term of their registrations, or of the renewals thereof, expires, at which time renew under the new act; (2) they may bring their registrations under the new act; or (3) they may reregister their marks on the principal register of the new act; o r (4*) such registrants m a y follow the first and third or (5) follow the second and third of these courses. The new act imposes no obligations on registrants under the acts of 1881 or 1905, whose registrations will automatically enjoy all of the benefits of t h e new act at no extra cost or effort, except t h a t these registrations cannot become incontestable, and m a y be canceled a t a n y time on t h e application of any person who believes he is or will be damaged and makes the proper showing. B u t neither can t h e y be automatically canceled for failure to file t h e sixth year affidavit of use [Sec. 46(b)]. However, such registrant may, if he wishes, and his m a r k is in use, claim the benefits of the new act by filing an affidavit making such claim and paying a fee of $10; whereupon the mark is published in the Official Gazette of the U . S. P a t e n t Office and in five years may become incontestable—or perhaps automatically canceled for failure to file the sixth year affidavit—like a n y registration under t h e new act [Sec. 12(c)]. On t h e other h a n d , t h e 1881 or 1905

CHEMICAL

registrant may register anew, leaving his older registrations intact, to abide judicial construction of the new act, which clearly provides t h a t marks registered under previous acts may also be registered under this one [Sec. 46(b)]. A check should be m a d e of all m a r k s which could not be registered or were denied registration previously for a n y of the following reasons: the. mark was geographical in connotation; identical with a family or surname; identical with a corporation's name; there was more t h a n one bona fide owner; the owner was not using the mark himself; the mark was used in connection with services, r a t h e r than merchandise; t h e m a r k was n o t affixed directly to the goods; the mark was an association or certification m a r k ; or the mark was used on a different type of goods. Owners of 1920 act registrations m a y follow the procedure which has been previously outlined. Particular care should be taken in connection with such registrations which will expire J a n . 5, 1948. Trade-marks t h a t were registered u n d e r the Act of 1920 before J a n . 5, 1928, expire on J a n . 5. 194S. Marks t h a t were registered after Jan. 5, 1928, expire 20 years after the date of registration. These marks can be reregistered on t h e principal register if the registrant can show t h a t the mark has acquired real trade-mark significance or "secondary meaning." M a r k s which cannot be reregistered on t h e principal register can be renewed on t h e supplemental register if the registrant would otherwise lose a foreign registration. Like all new legislation m a n y questions of interpretation and procedure will arise under the new -act. T h e P a t e n t Office will promulgate the rules of procedure governing the registration of marks under the new act. These rules will help t o clarify the specific steps which tradem a r k owners will have to t a k e fully to protect their marks. A number of inconsistencies, minor errors, and a m biguities have been discovered in t h e text of the act after i t has been passed which will probably be corrected by a m e n d m e n t s by Congress. M a n y new legal questions of rights and procedure will of course arise which will have t o be clarified by t h e courts. However, t h e same was true of all the previous registration acts a s it is humanly impossible t o write a law which will provide for all possible situations t h a t might arise in t h e future. Bibliography Derenberg, Walter J., "Preparing for the New Trade-Mark Law," New York, Research Institute of America, 1946. Robert, Daphne, " T h e New Trade-Mark Manual," Washington, D . C , The Bureau of National-Affairs, Inc., 1947. T h e New Trade-Mark Law Text, Public Law 489, Washington, D . C , U . S. Patent Office, 1946. PRESENTED before the Division of Industrial and Engineering Chemistry at the 111th national meeting of the AMERICAN CHEMICAL SOCIETY, April 14 through 18, 1947, Atlantic City, N. J.

AND

ENGINEERING

NEWS