Taming the Trolls: Courtroom Battles and Reforms in Trademark Law
In the world of intellectual property, trademark trolling is a growing problem. Trademark trolling is a disparaging term used for entities that register a trademark without an intent to use it.[1] Instead, they try to defraud the system by suing or acquiring settlements from others who use a similar mark.[2] Focused on exploitation, these practices threaten businesses, especially in technology, fashion, and entertainment, where brand identity is so important. This article explores how courts have responded to trademark trolling and proposes possible reforms to combat it.
Challenges for Courts
Courts face many challenges when determining whether a trademark registrant’s intent is genuine or if they are looking to exploit the system. They need to balance the rights of legitimate trademark holders with preventing bad-faith actors from abusing the system.
One of the most critical factors courts will examine is the registrant’s history of filing numerous spurious trademarks.[3] Additionally, courts assess if the trademark would lead to consumer confusion.[4] However, this standard can be difficult to apply in trolling cases where the key issue often becomes whether the trademark holder genuinely intends to use the trademark in commerce.
Court Responses to Trademark Trolling
U.S. courts have had mixed responses to trademark trolling cases. In many instances, courts have dismissed claims when it is clear the registrant is acting in bad faith or that there is no evidence of intent to use the trademark. For example, in Central Mfg. Co. v. Pure Fishing, Inc., the court dismissed the claim and imposed sanctions due to bad faith and abuse of the legal process.[5] Additionally, there has been a history of individuals registering domain names in bad faith to extort companies and individuals.[6] One of the most notable early trademark troll cases is People for the Ethical Treatment of Animals, Inc. (PETA) v. Doughney. Here, Doughney registered the domain name “peta.org” and used it to host a parody site titled “People Eating Tasty Animals”, mocking PETA.[7] Although Doughney claimed his use was “constitutionally-protected” speech, the court disagreed.[8] The Court emphasized that Doughney lacked legitimate use in commerce, which is essential for trademark rights.[9]
The Trademark Trial and Appeal Board (TTAB) has been trying to reduce trademark trolling by rejecting applications that lack bona fide intent.[10] In SmithKline Beecham Corp. v. Omnisource DDS, LLC, No. 91178539, 2010 WL (T.T.A.B. Nov. 29, 2010), the TTAB denied the trademark application because the applicant failed to demonstrate a genuine intent to use the mark in commerce, as required under U.S. trademark law. This case illustrates that courts and administrative bodies are working to ensure that trademarks are being used for their intended purpose of signifying the source of goods or services in commerce.[11]
Conversely, in Bang Laugh Love, LLC v. Viragh, the court dismissed a counterclaim alleging that the trademark was fraudulent.[12] It noted that allegations of fraud must meet a heightened pleading standard and be supported by clear evidence of willful intent to deceive the U.S. Patent and Trademark Office (USPTO).[13] This strict standard of proof protects legitimate trademark holders from frivolous accusations, but also creates a challenge when trademark holders try to make legitimate claims.
Potential Legal Reforms
The rise of e-commerce has made it easier for trolls to register marks and monitor for potential infringement worldwide, increasing their ability to target businesses through “[a]n increase in unauthorized use, counterfeiting, and dilution of brand identities.”[14] As the issue of trademark trolling grows, legal scholars and practitioners have proposed various reforms to address the problem.[15] One suggestion is to implement stricter use requirements at the time of registration.[16] Currently, trademark applicants can file based on an “intent to use” the mark in commerce, but proving this intent can be satisfied too easily. [17] All that is required to show a good faith intention is “a sworn statement in your application that you have a good faith (bona fide) intention to use the mark in commerce.”[18] By requiring more concrete evidence of use, such as a detailed business plan or product prototypes, this reform could deter trolls from filing applications.
I propose that another potential reform is increasing the filing fees for trademark applications, particularly for individuals or entities that file numerous applications for unrelated marks. This measure would raise the financial barrier to entry for bad-faith actors while preserving access to serious applicants. Countries like Canada have already adopted higher fees for multiple trademark applications, and the U.S. could benefit by following suit.[19]
Additionally, there is a demand for federal legislative reform, exemplified by the Trademark Modernization Act of 2020.[20] Legislators could amend the Lanham Act, which specifically addresses bad-faith registration, by providing clearer guidelines for courts to follow when evaluating trolling cases.[21] For example, they could create stricter bona fide intent requirements, impose penalties for bad-faith filings, and define bad faith more explicitly to strengthen the Act’s effectiveness.
In my opinion, setting a compulsory timeframe for the trademark holder to show that the product or service associated with the mark is in use could help clear out inactive or speculative filings, freeing up trademarks for legitimate businesses. Other jurisdictions, such as the European Union, already have strict use-it-or-lose-it provisions, which could serve as a model for U.S. trademark law.[22]
Conclusion: Moving Forward
The issue of trademark trolling, in the my opinion, poses a significant challenge to the intellectual property landscape. Courts have taken steps to combat this practice, but the problem persists because of how easy it is to register trademarks.[23] Trademark law should remain a tool for protecting genuine commercial interests, not for enabling opportunistic abuse. In the my view implementing stricter use requirements, raising filing fees, and enacting legislative reforms, lawmakers and courts can work together to reduce trademark trolling and protect businesses and courts from frivolous litigation.
Footnotes
