When a small, East Coast heath care company decided to file its trademark application online, the company didn't know what it was getting itself into. The online application process, provided on the Trademark Office's Web site, seemed fast and easy. It also saved the company the money it otherwise would have paid to outside trademark attorneys.

Unfortunately, the company, which didn't want to be identified, ran into a problem. It checked off the wrong boxes in the online application process. Instead of indicating that it wanted the mark to cover a new service it was offering, the company indicated that the mark should cover only goods–specifically, promotional giveaways, such as key chains emblazoned with its trademark. The company didn't discover the error until after a competitor, a major consumer company, began using the same trademark for an identical service.

The healthcare company wants to sue the national concern for infringement, but things don't look good. The suit can't be brought until the company files a new, corrected application, and the delay in filing such an application has severely compromised its case. The company seems likely to obtain rights in the mark for the limited geographical area in which it has used it, but won't be able to stop the competitor from using the mark nationally.

This company isn't the only one to run into trouble with online trademark applications. In the fourth quarter of 2004, 80 percent of trademark applications were submitted through the U.S. Trademark Office's Web site, rather than by mail. The online process is so easy, however, that a growing number of applicants have been lulled into a false sense of security. They think they can fill out their applications without guidance from experts in trademark applications.

“An increasing number of businesses have been unwittingly lured to self-filing, given the perceived simplicity of an electronic form with designated fields,” says Robert Burlingame, a trademark attorney at Pillsbury Winthrop. And as a result, he says, some of these companies, “have ruined their applications or registrations.”

Online Missteps

Many of the difficulties arise when people who aren't well versed in the subtleties of trademark law try to complete online applications. The most common problem is that the company describes the goods and services too narrowly, according to Douglas Wolf, a trademark lawyer with Wolf, Greenfield & Sacks. For instance, a company files a trademark application covering men's, women's and children's sandals. A few years later, it wants to use that same trademark for men's and women's dress shoes–but a competitor already had filed for the identical mark for those types of products.

Problems also can arise if the applicant identifies the goods and services too broadly. An application (other than an intent-to-use application) can legally cover only goods and services the applicant is currently producing. If the application offers an overly broad description of these goods and services, the problem is usually minor. The Trademark Office will just ask the applicant to submit a more restricted description.

However, if the application contains specific items the company doesn't produce, the Trademark Office can throw out the entire application–and any ensuing registration–for fraud. That's what happened in 2003 to NeuroVasx, a Minnesota-based medical supply company.

The business filed an intent-to-use application in 1998 to register the mark NEUROVASX. On Jan. 7, 2000, the company filed a statement of use, indicating it had used the mark for “medical devices, namely, neurological stents and catheters,” and the company soon received its trademark registration.

However, the company never used the mark for stents. The company claimed it had “overlooked” the offending word when it completed the application, and asked for permission to amend its registration. The Trademark Trial and Appeal Board (TTAB) denied the request. It said NeuroVasx “knew or should have known” that its statement was false, so the company had fraudulently procured the registration. It was irrelevant whether NeuroVasx really had any fraudulent intent, the TTAB ruled; it committed a fraud and thus the entire registration was void.

Expert Opinion

However, it's not only novices in trademark law that run into trouble with online applications. People who know trademark law inside and out and are capable of completing paper applications in their sleep still can be flummoxed by the online process.

The problem arises because the electronic form isn't quite the same as the paper version. Instead, it is a wizard that takes applicants step by step through the process, prompting them to check the correct boxes in order for the wizard to provide a user with the appropriate fields to fill out.

“The way the electronic forms are laid out, it can be hard to determine where information is supposed to go, which boxes are supposed to be checked,” Burlingame says.

Lisa London, a trademark expert at Finnegan, Henderson, Farabow, Garrett & Dunner agrees. “I've been doing this since 1989 [when the online applications process first began], and I'm still sometimes scratching my head trying to find out which box to check to put in my argument,” she says.

Adding attachments is another problem area–and almost all applications require them. Suppose, for instance, a company wants to register a design mark (a mark that has a particular look to it, such as a specific font or color background). The applicant must then submit an attachment with the application that shows the design mark. If a company files a statement-of-use application (because the company already had used the mark in commerce), it must attach a specimen of use to the application. If the application is to be signed manually, instead of electronically, it also must attach a document showing the signature.

The Trademark Office's examinations branch, which reviews trademark applications, requires all electronic attachments be in a high-resolution JPEG format. However, it can be a hassle to create images in the right format and resolution (300 dots per inch). “Our scanners didn't do this,” says London, so it would require 30 minutes of work to convert each scanned image into something the Trademark Office would accept.

Eventually, her firm's IT department found a way around this time-consuming process by designing a program that converts TIFF images into JPEG files with the appropriate resolution. “And we still have to play with the images occasionally,” London says.

The Price Is Right

The system's advantages, however, far outweigh the problems with the online process. For starters, online applications save money. The filing fee for an online application is $325 for each class of goods and services covered by the application, while the fee for paper applications is $375 per class. This savings of $50 per class can quickly add up, particularly if a company applies for a variety of trademarks, each of which covers numerous classes of goods or services.

Companies also can complete online applications more quickly than their paper counterpart.

“Preparing an online application, for a skilled professional, takes roughly 20 percent less time than the paper alternative,” says C. Dennis Loomis, a trademark attorney at Jenkens & Gilchrist. This creates significant savings in time and money.

Moreover, the online process goes a long way toward eliminating pesky typographical errors in applications. Such errors frequently appear when the Trademark Office manually enters data from paper applications into the agency's computers. Companies applying for marks often have to waste time and money looking for and correcting errors. The data from online applications, however, goes directly into the agency's computers, eliminating the problems the Trademark Office caused with stray keystrokes.

Finally, the Trademark Office receives and processes online applications more quickly than those submitted as hard copies. This can be a major advantage when a company wants to get its application filed fast, before someone else can claim rights in the mark.

With all these advantages, many observers predict that practically all companies will soon give up on paper applications. Online trademark applications “are wonderful things,” Burlingame says, “but you've got to know what you're doing.”