December 10, 2020
Intellectual Property Alert
Intellectual Property Alert
The ongoing COVID-19 pandemic has affected nearly every facet of business operations, including patent and trademark filings. We explore trends that have emerged from Q1 to Q3 at the USPTO.
Now that the United States is entering its ninth month of various levels of lockdown due to the ongoing COVID-19 pandemic, patterns begin to emerge showing how the pandemic has affected applications for trademarks and patents.
The COVID-19 pandemic had an immediate effect on United States Patent and Trademark Office (USPTO) operations. The USPTO quickly closed its physical offices to the public and non-essential employees, switched to teleconference hearings only, and waived the requirement for handwritten signatures. On March 31—mere weeks after most states began issuing stay at home orders—the USPTO announced extensions for certain filings under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
For trademarks this included the deadlines to file responses to office actions, statements of use, notices of opposition, or priority filings under certain sections, and allowed for requests of extensions because of the COVID-19 outbreak for any other filing. Similar extensions have been authorized for patents. These extensions have been updated numerous times since March. The later updates provided further extensions only for small and micro entities.
Beyond these official extensions, the global pandemic has had other effects on those seeking trademark and patent protection.
In the United States, where use of a mark in commerce is eventually required, it would be expected that some entities will not be able to make this showing—even with the granted extensions. For example, companies offering services related to large concerts or sports gatherings, or goods meant for travel. On the other hand, we might expect an uptick in applications for marks in connection with new “hot” items, such as hand sanitizer, face masks, and vaccines. The USPTO has not issued formal guidance about whether the pandemic constitutes viable grounds to support an affidavit of excusable non-use (e.g., situations where the pandemic caused a failure to resume.)
In the patent realm, on May 8, 2020, the USPTO announced the COVID-19 Prioritized Examination Pilot Program for small and micro entities. Under this new pilot program, the USPTO will grant requests for prioritized examination to patent applicants that qualify for small or micro entity status without payment of the typical fees associated with other prioritized examination. In addition, the USPTO stated it would try to reach final disposition of applications in this program within six months, if applicants respond promptly to communications from the USPTO. To qualify for the new program, the claims of an application must cover a product or process that is subject to U.S. Food and Drug Administration (FDA) approval for use in the prevention and/or treatment of COVID-19. Thus, we might expect an uptick in COVID-19-related patent applications, such as vaccines and/or other drugs for treatment of COVID-19.
On the other end, those that already own registered trademarks or patents may have had their enforcement actions stymied as courts around the country were temporarily closed, creating a litigation backlog
Statistics published by the USPTO show that the general trends in the greater economy have been mirrored in the rate of trademark applications. While nearly the same number of trademark applications were filed in Q1 of 2019 and Q1 of 2020, Q2 of 2020 brought more than 2,000 fewer applications than the same quarter in the previous year. Luckily, Q3 has seen a turn around, with more than 6,000 more applications than those filed in Q3 of 2019. This tends to show a hesitancy of companies to file new applications at the start of the pandemic, but a rush to return to “business as usual” once the longer term reality set in.
Overall, the beginning of the pandemic brought a slowdown in the trademark world, between closures at the USPTO, automatic deadline extensions, and a major drop in applications. However, as the USPTO and potential trademark owners have settled into the “new normal,” the trademark sector seems well on its way to recovery.
About 3.8% more patent applications were filed in Q1 of 2020 compared to Q1 of 2019. That growth slowed in Q2 when only 1.7% more patent applications filed in Q2 of 2020 compared to Q2 of 2019. The slowed growth continued in Q3 with a mere 0.6% more patent applications filed in Q3 of 2020 compared to Q3 of 2019. While it does not appear that the lockdown has slowed innovation, there is less growth in patent filings as we are deeper into the pandemic.
Overall, the number of patent applications in the U.S. has been holding steady since the pandemic began, which could be due to the special incentives created by the USPTO that encourage innovations related to COVID-19.
Like much of the U.S. economy, U.S. companies and entrepreneurs have pulled their collective resources together to adapt the current business environment and pivoted in a way that resulted in a steady stream of new patent and trademark applications, suggesting our economy is still thriving, albeit in a slightly different manner. Only time will tell what long-term implications the current pandemic will have.
The foregoing has been prepared for the general information of clients and friends of the firm. It is not meant to provide legal advice with respect to any specific matter and should not be acted upon without professional counsel. If you have any questions or require any further information regarding these or other related matters, please contact your regular Nixon Peabody LLP representative. This material may be considered advertising under certain rules of professional conduct.
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