LEGAL GUIDE
Written by attorney Deepak Malhotra | Dec 22, 2010

How to Calculate Date of First Use in Commerce

In an application based on use in commerce, a trademark applicant must use the mark in commerce on or in connection with all the goods and services listed in the application as of the application filing date. The application must include a statement that the mark is in use in commerce, verified in an affidavit or declaration. If the verification is not filed with the original application, it must also allege that the mark was in use in commerce on or in connection with the goods or services listed in the application as of the application filing date.

In an application based on "intent-to-use," the applicant typically begins use in commerce after the filing date. The application must include a verified statement that the applicant has a bona fide intention to use the mark in commerce on or in connection with the goods or services listed in the application as of the application filing date. Prior to registration, the applicant must actually use the mark in commerce on or in connection with all the goods or services specified in the application and file an allegation of use ( i.e., either an amendment to allege use or a statement of use).

The power of the federal government to register marks comes from the commerce clause of the U.S. Constitution. The Trademark Act, permits application for registration of "a trademark used in commerce" or of a trademark that a person has a bona fide intention to use in commerce ("intent-to-use" application).

The Trademark Act defines "commerce" as "all commerce which may lawfully be regulated by Congress." Section 45 defines "use in commerce" as follows:

The term "use in commerce" means the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark. For purposes of this Act, a mark shall be deemed to be in use in commerce--

(1) on goods when--

(A) it is placed in any manner on the goods or their containers or the displays associated therewith or on the tags or labels affixed thereto, or if the nature of the goods makes such placement impracticable, then on documents associated with the goods or their sale, and

(B) the goods are sold or transported in commerce, and

(2) on services when it is used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services.

The definition of use in commerce was amended by the Trademark Law Revision Act of 1988 (TLRA) to add the phrase "the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark." The primary purpose of the amendment was to eliminate the practice of "token use," or use made solely to reserve rights in a mark.

The legislative history of the TLRA makes it clear that the meaning of "use in the ordinary course of trade" will vary from one industry to another.

While use made merely to reserve a right in a mark will not meet this standard, "the ordinary course of trade" varies from industry to industry. Thus, for example, it might be in the ordinary course of trade for an industry that sells expensive or seasonal products to make infrequent sales. Similarly, a pharmaceutical company that markets a drug to treat a rare disease will make correspondingly few sales in the ordinary course of its trade; the company's shipment to clinical investigators during the Federal approval process will also be in its ordinary course of trade....

The revised definition of "use in commerce" should be interpreted flexibly so as to encompass various genuine, but less traditional, trademark uses, such as those made in test markets, infrequent sales of large or expensive items, or ongoing shipments of a new drug to clinical investigators by a company awaiting FDA approval....

Therefore, some factors to consider are: (1) the amount of use; (2) the nature or quality of the transaction; and (3) what is typical use within a particular industry.

The types of commerce encompassed in calculating the date of first use include interstate, territorial, and between the United States and a foreign country.

"Territorial commerce" is commerce within a territory of the United States (e.g., Guam, Puerto Rico, American Samoa, or the United States Virgin Islands) or between the United States and a territory of the United States.

Purely intrastate use does not provide a basis for federal registration. Some people think that a sale across state lines is required to establish a date of first use. However, if intrastate use directly affects a type of commerce that Congress may regulate, this constitutes use in commerce within the meaning of the Trademark Act. For example, many cases were decided during the Civil Rights era that expanded Federal authority using the commerce clause.

The following is a summary of a few cases involving trademarks. A Mark used to identify restaurant services rendered at a single-location restaurant serving interstate travelers is in "use in commerce." An intrastate sale of imported wines by importer constitutes "use in commerce," where goods bearing labels supplied by applicant were shipped to applicant in United States. An automotive service station located in one state was considered to be rendering services "in commerce" because services were available to customers travelling interstate on federal highways). A billiard parlor services satisfy the "use in commerce" requirements, where the record showed that applicant's billiard parlor services were advertised in both Kansas and New York. A hotel located in only one state has valid use of its service mark in commerce because it has out-of-state guests, has offices in many states, and advertises in national magazines. A mark used to identify retail department store services located in one state was in use in commerce, where the mark was used on credit cards issued to out-of-state residents, and on catalogs and advertisements shipped to out-of-state customers.

In some cases, services such as restaurant and hotel services have been deemed to be rendered in commerce because they are activities that have been found to be within the scope of the 1964 Civil Rights Act, which, like the Trademark Act, is predicated on the commerce clause.

Offering services via the Internet has been held to constitute use in commerce, since the services are available to a national and international audience who must use interstate telephone lines to access a website. Note that this applies to service marks, which are marks for sale of services. An Internet offer would likely not be sufficient for a trademark applying to sale of goods.

An applicant is not required to specify the type of commerce in which the mark is used. The U.S. Patent and Trademark Office presumes that an applicant who states that the mark is in use in commerce is stating that the mark is in use in a type of commerce that Congress can regulate, unless there is contradictory evidence.

It is important to state the first date of use accurately. A false statement of the date of first use, or using the date of a token use, can result in invalidation of the registration with potentially disastrous consequences, years after a registration has issued. Do not take this calculation lightly and do not assume that if a registration has issued, all is well. The U.S. Patent and Trademark Office generally takes applicants at their word as does not usually independently verify dates of first use.

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