Trademark Squatter Filed for Your Brand First? Here’s What to Do.
You built the brand. You created the website. You spent money on advertising. You have customers, sales, and revenue.
Then you search the USPTO database and discover something alarming: someone you have never heard of filed a federal trademark application for your exact brand name.
Worse, they filed before you did.
This is a situation I encounter weekly in my practice. It can be particularly alarming when the other applicant has no apparent connection to the brand and has filed an intent-to-use application, meaning they are telling the USPTO that they intend to use the name rather than claiming they are already using it in U.S. commerce.
The good news is that filing first does not necessarily mean they own your brand.
Trademark Squatting Is a Real Problem
Trademark squatting generally involves someone applying to register a trademark associated with a brand that another business has created or is already using. I have encountered a number of these matters involving applicants located outside the United States, including Chinese companies and companies that appear to be seeking U.S. trademark rights in brands already being developed or used by others. That does not mean a Chinese applicant, or any foreign applicant, should automatically be considered a squatter. There are countless legitimate Chinese businesses filing U.S. trademark applications every year. The concern arises from the specific facts: for example, an unrelated applicant suddenly filing for the exact name of an existing U.S. brand, for the same products, despite having no apparent relationship with the business. That deserves immediate attention.
They Filed First. Did You Lose?
Not necessarily.
One of the biggest misconceptions about U.S. trademark law is that whoever files the trademark application first automatically owns the trademark. U.S. trademark rights can arise from actual use of a mark in commerce, not merely from being the first person to submit an application. That makes the timeline extremely important. Suppose your company began selling herbal supplements under Supplemently Z in June. You have actual U.S. customers, orders, advertising, packaging, website records, and other documentation. Then, in August, an unrelated party files an intent-to-use application for Supplemently Z covering herbal supplements. The fact that their USPTO application was filed before yours is important, but it does not erase the fact that you may have been using the mark first. This is why I tell my clients in this situation: do not assume the USPTO filing date tells the entire story.
What Should You Do?
The worst strategy is usually to ignore the competing application and hope the USPTO figures everything out automatically.
The USPTO examining attorney reviewing an application is generally focused on whether the application satisfies the requirements for federal registration. The USPTO is not going to independently litigate a private dispute over who used a brand first.
A business facing this situation may need a coordinated strategy involving its own federal trademark application and action against the competing application.
The exact approach depends on the facts, including:
When you first used the trademark in U.S. commerce
What evidence exists documenting that use
Whether the competing application is based on actual use or intent to use
How closely the competing goods or services overlap with yours
The status of both applications
Whether the competing application has been published for opposition
Timing matters considerably. Waiting until the competing application has already registered can make the situation more complicated and expensive.
Your Application May Be Suspended
Clients are sometimes alarmed when I explain that their own application could be temporarily suspended because someone else filed first. A suspension does not necessarily mean the USPTO has decided that the other applicant owns the trademark. It can simply mean the USPTO is waiting to see what happens with the earlier-filed application before proceeding with yours. If there is a legitimate prior-use dispute, the real fight may take place elsewhere in the process.
The Opposition Period Can Be Critical
Before most U.S. trademark applications register, they are published by the USPTO for a period during which qualifying third parties can challenge the registration.
This is known as a trademark opposition.
An opposition is a proceeding before the Trademark Trial and Appeal Board, or TTAB. For a legitimate brand owner facing an apparent squatter, this can be an important opportunity to assert earlier trademark rights before the competing application becomes a registration.
This is also why simply checking the competing application occasionally is not a strategy I recommend. The application needs to be monitored.
Missing an important deadline can turn a manageable problem into a considerably more expensive headache.
What Happens When the Alleged Squatter Is Actually Challenged?
This is where my experience with these cases becomes particularly relevant. I have handled this exact situation numerous times. In the apparent squatter situations I have encountered, the other side often becomes considerably less interested in the trademark once maintaining the application requires them to participate in an actual U.S. legal proceeding. An application is relatively easy to file. Prosecuting the application and defending a TTAB opposition is different. The applicant must respond to the proceeding and potentially spend significant time and money defending its falsely claimed rights. In the apparent trademark-squatting matters I have encountered, the opposing applicant frequently does not fight back. When an applicant fails to properly respond to an opposition, the proceeding can result in a default judgment against the applicant and the challenged application can be refused registration. However, that is not guaranteed. Every applicant has the right to defend its application, and a contested TTAB proceeding can become substantial litigation. But the possibility of default is an important practical consideration when evaluating an apparent squatter.
Evidence Matters
If you believe someone has filed for your brand, start preserving evidence immediately.
For an existing U.S. business, potentially important evidence can include sales records, invoices, website archives, product photographs, packaging, advertising records, social-media activity, domain information, marketplace listings, customer transactions, and other documentation showing when and how the trademark was actually used.
A screenshot taken today saying “we’ve been selling this for months” is not nearly as useful as organized, dated documentation showing what actually happened.
Do not wait until a dispute is underway to start looking for it.
Don’t Panic, but Don’t Wait
Discovering that someone else filed for your brand can feel like the business has already lost. That is not necessarily the case. An earlier USPTO filing and earlier trademark rights are not always the same thing. If your business was genuinely using the trademark first, there may be options for protecting the brand and challenging the competing application. But these matters are highly dependent on timing, evidence, the competing applicant’s filing basis, and the procedural status of the applications.
If an unrelated party has filed a U.S. trademark application for a brand you were already using, I can review the competing application, evaluate your prior-use position, file your own trademark application where appropriate, and develop a strategy for dealing with the competing filing.
The earlier this is addressed, the more options you generally have.
Need help with an apparent trademark squatter? Contact Morgan Business Solutions for a review of your situation.