United States: U.S. Trademark Office, Frustrated By Rules Violations, Issues Proposed Rule Requiring Foreign Filers To Engage U.S. Counsel

In response to the dramatic rise of foreign applicants filing trademark applications that have inaccurate and possibly fraudulent statements regarding use, the U.S. Patent and Trademark Office recently issued a Notice of Proposed Rulemaking announcing that foreign applicants will no longer be able to represent themselves before the USPTO.  This is a departure from current practice that allows foreign parties to file with the USPTO directly and represent themselves before the TTAB.  The rule is expected to take effect sometime in the fall of 2019.

The proposed rule indicates that in 2017 alone, foreign applicants filed over 115,000 trademark applications at the USPTO, and that over 50,000 of these came from unrepresented foreign parties.  A substantial number of these came from China-based applicants who appear to be filing applications in the U.S. as a result of subsidies offered by China’s municipal governments to spur foreign investment.  Although the USPTO has expressed its concern regarding these filings to Chinese trademark officials, China has indicated it has no ability to control the subsidies offered by the local municipalities.

Under the new rule, foreign parties whose domicile or principal place of business is not located within the U.S. or its territories will need to be represented by licensed U.S. counsel.  Foreign corporations that have a U.S. subsidiary can still have their U.S. subsidiary file applications directly, so long as the subsidiary has a licensed U.S. attorney.  If a foreign applicant files an application in violation of the rule, the USPTO will give the applicant an opportunity to cure the defect by appointing U.S. counsel who will then need to review and attest that the application complies with U.S. law.

At least for the immediate future, foreign applicants will still be allowed to submit Madrid extensions into the U.S. without a U.S. attorney, but will be required to appoint a U.S. attorney if an Office Action issues.  This will likely change once the Madrid filing system is updated to allow for the designation of a U.S. attorney.

The rule will apply to trademark applicants, registrants, and parties to TTAB proceedings.  The proposed rule can be found here.

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