Wednesday, January 27, 2021

Irene Calboli: Trademarking COVID

Irene Calboli, professor of law at Texas A&M University School of Law, has written a new empirical article reporting that "the COVID-19 pandemic has led to a veritable tsunami of trademark applications" for COVID, QUARANTINE, SOCIAL DISTANCING, and other pandemic-related terms.  Indeed, Calboli concludes that trademarking of COVID-related terms is unusually rampant, even when compared to past tragedies and disasters such as 9/11, Hurricane Katrina, and Ebola. "Ultimately," Calboli writes, "probably only the HIV/AIDS pandemic can be compared with COVID-19 in terms public awareness, societal fears, and strong emotions," and even "the beginning of the HIV/AIDS pandemic did not see a similar rush to trademark filings" that we have seen with COVID. While several practitioners have also noted the large number of applications filed for these terms in the past month, Calboli's paper is the first to survey these applications comprehensively and in detail. 

The full article, Trademarks and the COVID-19 Pandemic: An Empirical Analysis of Trademark Applications Including the Terms “COVID,” “Coronavirus,” “Quarantine,” “Social Distancing”, “Six Feet Apart,” and “Shelter in Place, can be downloaded on SSRN.  The data are included as an appendix to the paper.  The article will be published in the Akron Law Review's IP Symposium Issue as part of the Annual Akron Law IP Scholars Conference. (The other scholars publishing in this year's IP issue are Margaret Chon, Robert Merges, Kristen Osenga, and Sharon Sandeen.) 

I interviewed Professor Calboli on her findings. The interview is transcribed in this post.  To follow along, here is one of the many beautiful tables and informational graphics in the article, included with Calboli's permission.


Table 1  


As you can see, Calboli reviewed a total of 782 trademark applications filed through the end of the year 2020 and presently under examination at the U.S. Patent & Trademark Office. Importantly, a large majority (542 applications) are filed under the Section 1(b) "bona fide intent to use" filing basis, rather than based on actual current use. These applicants will eventually need to convert their applications by proving they are actually using the marks in commerce. So they are in a sense betting on what they will be able to sell and on what will be popular in future.

CAH: Wow, this an amazing paper. It's so comprehensive. I am fascinated by what it reveals about trademarks, as well as about society. The most common term by far was the term COVID itself. You found 519 filings for COVID. The distant second was QUARANTINE, with 121 filings. But CORONAVIRUS meanwhile represented only 54 applications.  Why might this be? Why not more for coronavirus itself?

IRENE CALBOLI: This could be because COVID has become the more common referent in public conversation, not "Coronavirus." It's also possible that applicants thought of "coronavirus" as too generic.

CAH: Around 209 filings were for actual medical products, like face masks, hand sanitizers, and items related to vaccines. Some of them make what look to me like health and safety claims, such as COVID SHIELD for air filters, COVID-19 PROOF for antibacterial cleaning products, and CORONAVIRUS FREE for medical compression tights... Can you speculate on the health and safety implications of this?  Should a trademark be allowed for a mark like COVID-19 PROOF for cleaning products?

IRENE CALBOLI:  I don't think the use of these terms for medical products is necessarily problematic. For example, a mark like COVID-ONESWAB registered for swab tests seems fine to me, so long as it's truly for a test and is effectively able to identify the source of the products. The problem is when you start to see filings for marks like COVID-19 PROOF.  Nothing can be one hundred percent "COVID PROOF"! The Section 2(a) deceptive matter bar should "kick out" and prevent registration of some of the more misleading marks. These applications should be barred as deceptive, since they can mislead consumers. Applicants seem to try to use these signs to market products as "safe" when this simply cannot be proven at all. Hopefully, the examiners will be tough on those sorts of marks. It will be interesting to see what happens as more office actions are written on these applications. It will be especially interesting to review these office actions. 

CAH: A great number of applications were for unrelated products. For example, you found applications for COVID SAUCE for coffee or QUARANTINE& CREAM for body cream. And a ton of filings (around 200) are actually for merchandise and promotional products, T-shirts, hat, pins, and the like. At the Akron Scholars event, you said,

“The million dollar question is why you would want to call your beer COVID, when we all want to move on. But I don’t think people think through that. And we already have a beer called Corona."  

Can you speculate on that? Do consumers really want to buy a HERO COVID-19 2020 T-shirt or a SIX FEET APART IS SMART lapel pin?  If not, why are people still filing these? 

IRENE CALBOLI: I think this dataset is (unfortunately) the perfect example of a case study on the phenomenon of "registering sensation." People swarm in to register a buzz word like COVID or QUARANTINE or SIX FEET APART.  They somehow think they can make money by registering these names and selling products carrying these names. But they don't really seem to think through this. And they don't seem to understand what the proper functions of trademarks are, or what type of signs can, and should, actually be protected. They just want to register new and hot buzz words. Some applicants write in the description of goods/service in the applications language such as "I hope I will sell products with this mark" or "I hope others will not be able to use it." The reality is that people seem to be running to register trademarks that are very likely to be rejected, because they may be descriptive, generic, or misleading, and in turn are unlikely to make the applicant any profits. In fact, these applications are a cost for the applicants who have to pay the fees.

CAH: This is an empirical piece, so you don't necessarily speculate on whether these filings might be a problem as a policy matter.  But are they? Aside from the safety issue we just discussed, is there anything wrong with people getting tons of trademarks on COVID or pandemic-related slogans for T-shirts and bracelets?   Is this a competition problem or a free speech problem? Will these marks "clog" or "clutter up" the system, detracting from the universe of useful marks, as discussed by Barton Beebe and Jeanne Fromer in Are We Running Out of Trademarks?

IRENE CALBOLI: Not necessarily, in my view, because  lot of these marks will be denied and, even if granted, will be very difficult to enforce in practice. Like Rob Merges said at the Akron panel, we witness an interesting phenomenon. We have 519 iterations of the word COVID in the 519 applications filed for this term. Clearly some of these will be redundant and denied, for example under Section 2(d) likely to be confused with a prior mark. However, the large number of filings also maybe casts doubt on the assumption of "language depletion" and its relationship with trademark applications (more studies on this should be conducted).
 
In the paper I do point out that in many instances, terms like COVID and QUARANTINE are used in ways that are quite arbitrary with respect to the associated products, so they may pass distinctiveness under Abercrombie. (Examples in the paper of "arbitrary" uses include COVID SURVIVOR filed for playing cards, and COVID BLUE filed for the advertising of real estate!)

However, there are other serious problems with these applications. In particular, many of these terms and phrases "fail to function" as a trademark. They are only ornamental or informational, they are not functioning as source-identifiers.  As I explain in the paper, the Trademark Manual of Examining Procedure (TMEP), used by examiners, says “failure-to-function” occurs when a mark does not “identify and distinguish the source of a good or service.”  Frankly, a lot of these slogans could fit within this definition. They seem (to quote the TMEP) to "merely convey an informational message" and so are not registrable. So if that is true, I am not sure these COVID trademarks are going to generate serious barriers to commercial activity or speech. 

[The “failure to function” issue is discussed at length in Alexandra Roberts' article in Iowa Law Review called Trademark Failure to Function.  Laura Heyman has also written a wonderful 2019 JOTWELL post on Roberts’ article, called, What We've Got Here is a Failure to Indicate.]

CAH: I agree a lot of these applications seem like they'll be rejected on the grounds you identify. I hope so: There could be a big problem for health and safety if misleading marks like COVID PROOF are granted. But even if they are denied, are there broader costs for the trademark system here?

IRENE CALBOLI: Yes, I think so. The reality is that sifting through all these applications can take up a lot of time and resources on the part of the USPTO.  The costs of examining these marks will be high and do not seem to be justified by any benefits.  Each application is assigned a different examiner on a random basis. It will take many months in order to examine all the applications. This is costly. And at the end, a large number of applications will probably be rejected. After all, the rate of rejection is almost one third for trademarks generally and it will certainly be higher for this group of applications. Also, even if an applicant gets a registration, it is unlikely that s/he will be able to protect the mark broadly or to turn it into a truly valuable brand like. In short, a lot of these signs are not really protectable, and the cons of putting these applications through the process, in my view, outweigh the pros for everyone. They cost the applicants. They cost the system.

CAH: How could the USPTO improve how it deals with these sorts of sensational filings?

IRENE CALBOLI: I would like to see support, even subsidy programs for SMEs (small and medium-sides enterprises) and individuals like in other countries, for good and useful trademarks, but not for the "registering sensation" phenomenon  we are seeing with COVID.  I think that more needs to be done to limit bad filings--filings that are likely to be rejected, do not function as marks, and costs both the applicants and system.  I think a lot of this has to do with education of the public about what can actually be trademarked and what is the function of a mark. 

The system is designed to be user friendly. This is a positive aspect of the system. But the USPTO could do more to deter these filings. Being user friendly does not mean that we need to be so permissive in letting in "junk applications." Now, one of the recurrent problems is that there is a lot of pressure for all IP offices to show high number of filings. And the "junk applications" still count as filings! However, if we spend more resources to examine them than the benefits we get from them (in terms of functioning marks) what is the point? Rather than counting how many applications are filed, we should focus primarily if not exclusively in counting how many marks are actually registered, and how many of these marks are renewed and used in the long term. In other words, despite the pressure of showing "a lot" of applications or how fast applications are processed, the USPTO should focus on how many applications are registered. 

The system can, and should be user friendly, but should do more to sift our bad filings and ideally prevent them. This is not a simple task. For example, some applicants submit fake specimens, because the office says "submit a specimen of how you're using the mark..."  But again, the more the USPTO educates the public about what trademarks are for and what can be trademarked, the more these sensation-driven filing could perhaps be deterred.

CAH: What are your future plans for this project after the Akron Law Review article comes out?

IRENE CALBOLI:  I will continue tracking these COVID-related applications to see their fate at the office. I plan to review the whole dataset in a few months and examine the office actions and the rate of rejections and registrations. I'll be asking questions like: Are these applications denied or granted? if they were rejected, what were the legal basis for these rejections? It will be interesting to see how many of these applications will survive and even if the marks are registered, how many will still be in use beyond the first couple of years?

Also, I would like to expand on this in a new project. In particular, I want to look at Class 25 filings for clothing, apparel, and the like.  I want to look at the rate of rejection in Class 25 and then compare this to rejections in other classes, like say pharmaceuticals (Class 5).  To do this, I need to carefully look at the USPTO data set as well as build ad hoc datasets like I did this time. Another project I am finishing is a similar empirical study on filings that include the words "Black Lives Matter." We have reviewed over 50 applications so far, many filed since Spring 2020, and I am creating a detailed data set of these applications.

CAH: Thank you for all your time, and for such a wonderful read. I really enjoyed this and look forward to seeing it in print!



No comments:

Post a Comment