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After Lexmark Rejects Multifactor Measures for Standing, Which Challengers Stand in the Zone of Interests for Lanham Act Remedies?

 |  July 11, 2016

Posted by Social Science Research Network

After Lexmark Rejects Multifactor Measures for Standing, Which Challengers Stand in the Zone of Interests for Lanham Act Remedies?

Charles Lee Thomason (Ohio State University)

Abstract:      The commercial value of trademarks, brand names, and related assets depends heavily on the certainty and predictability of the laws for registering, opposing, protecting, and cancelling these intellectual property assets. Predictability about the trademark laws drives the private recommendations and risk assessments that clients receive from attorneys and advisers. Trademarks, brand names, and other source-identifiers can become the most valuable intellectual property of a company. However, during the five years after a trademark is registered, a petition to cancel that registration can be filed, which can plead any ground on which registration might have been denied at the outset. Thus, after four-plus years of establishing brand identity and committing substantial investment to promoting a trademark, some unknown “person who believes that he is or will be damaged . . . by the registration” can petition to have it cancelled — if that “person” has statutory standing. Using outdated, multi-factor tests for standing enables overuse or the threat of use of Trademark Trial and Appeal Board (“TTAB”) procedures to challenge registered marks.

Lanham Act-standing was bound up in Article III tenets and “prudential” limitations disconnected from the statutory text. The Act’s remedies required resort to civil suits and appeals, as well as petitions to an administrative tribunal whose decisions were reviewable in a district court or by direct appeal to the Federal Circuit.

Recent Supreme Court decisions on the Lanham Act’s remedies impact, or should impact, the pleading, practice, and effect of actions to oppose or to cancel a registered trademark. The degree to which these decisions affect the predictability of the Lanham Act and the concomitant effect on the value of trademarks and brand names will evolve through the lower courts. One purpose of this Article is to urge that standing to petition the TTAB administrative tribunal for the remedies of cancellation or opposition should be governed by the pleading and practice standards the Supreme Court articulated in Lexmark International, Inc. v. Static Control Components, Inc. Although, Lexmark only considered Lanham Act § 43(a) claims. Yet, it dealt with statutory text virtually identical to that governing standing in §§ 13 and 14 actions, and as to all of these challenges, the harm typically claimed is a likelihood of marketplace confusion. Based on corresponding text in the statutes and similarities in the basis for the challenges, the Lexmark pleading requirements — being in the statutory “zone of interests” and alleging harm closely connected to those interests — should be extended to the pleading of TTAB challenges to registration of trademarks.