By: Kun Zhao, Esq.
Trademark rights are acquired and maintained through continuous use in commerce. Once a trademark owner suspends or stops using the mark in commerce, he is risking losing his right in the mark.
The trademark law, section 45 of Lanham Act, states that “a mark shall be deemed to be “abandoned” when its use has been discontinued with intent not to resume such use. Intent not to resume may be inferred from circumstances. Nonuse for three consecutive years shall be prima facie abandonment.” If the trademark is deemed abandoned, the owner cannot enforce his rights in the mark. The mark will then fall into the public domain and may be appropriated for use by others in the marketplace in accordance with the basic rules of trademark priority. In other words, if the mark is deemed abandoned, the person who registers the mark first or uses the mark first after the abandonment has the priority of using that mark in the marketplace.
There are two criteria for determining whether abandonment has occurred: (1) non-use and (2) intent not to resume use. Three years of non-use creates a rebuttable presumption of abandonment. “Intent not to resume” does not mean “intent never to use” but means “intent not to resume use within the reasonably foreseeable future.” If the owner suspended or stopped using the mark for more than three consecutive years, the owner will have to offer evidence of grounds for the temporary suspension and plans to resume use in the reasonably foreseeable future when the conditions requiring suspension abate to rebut a challenge of abandonment. The evidence of intent to resume use must be within the three year period of non-use. A bare assertion of possible future use is not enough.
The above rules also remind business owners that if the company intends to suspend using the mark for certain reasons, it should properly document the grounds for the suspension and the condition and time frame when the use will be resumed to rebut future challenges from others when asserting the right in the mark to protect company’s hard earned goodwill and mark recognition in the public.