USPTO Sanctions U.S. Patent Attorney for Renting out Bar Registration to Chinese Trademark Agency to File Trademark Applications

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In a Final Order in Proceeding No. D2021-8 dated September 24, 2021, the U.S. Patent & Trademark Office sanctioned a U.S. patent attorney for apparently renting out his bar number to a Chinese trademark agency.  The agency then proceeded to file U.S. trademark applications on behalf of foreign applicants under the attorney’s name and bar number.  This was presumably so that the foreign applicants could circumvent the the U.S. Counsel Rule, which sets forth a U.S. licensed attorney requirement for foreign-domiciled trademark applicants and registrants. The attorney was publicly reprimanded and needs to serve a 12-month probationary period.  It is unclear how common this practice is but the USPTO is cracking down on fraudulent applications from China, such as the order to show cause earlier this year against a Chinese firm for over 8,000 potentially fraudulent trademark applications.

Per the Order,

On July 31, 2019, an individual named Wen contacted Respondent on Fiverr seeking a “USPTO registered attorney” to “do our US trademark applications.” Wen represented an association with a China-based IP firm that would “have no problem, .. fil[ing] the trademark
applications, but.. .would like to use your name as our domestic REP.” Respondent agreed to a business relationship that allowed Wen to use Respondent’s name to file applications and receive trademark certificates from the USPTO as a domestic representative, Respondent agreed to be paid thirty dollars ($30) per trademark application filing.

Over the course of Respondent’s business relationship with Wen:

a. Respondent did not monitor the. status of, or review the trademark applications filed using his name, despite being apprised of the filings by Wen,

b. Respondent was listed as the attorney of record in approximately one hundred and forty (140) trademark applications filed by Wen or one of Wen’s associates with the USPTO.

c. Respondent did not advise or discuss with the applicants, directly or through a bona fide foreign representative, or with Wen, important legal issues regarding their trademark applications, such as what constitutes a proper specimen and the difference between Section l(a) and Section l(b) trademark applications. Nor did Respondent provide them with any other substantive legal advice about their trademark applications.

d. Respondent did not review or personally approve of the trademark applications prior to the filing of those applications by Wen or Wen’s associates with the USPTO.

e. Respondent’s electronic signature was entered on at least 45 trademark applications and attendant declarations filed by Wen or one of Wen’s associates with the USPTO. Respondent represents that the entry of his electronic signature on the trademark applications and attendant declarations was unbeknownst to him and done without his personal approval.

In early December 2019, the USPTO communicated with Respondent regarding ninety-two (92) suspect trademark applications filed on behalf of foreign-domiciled applicants bearing Respondent’s name, signature, and bar information. The applications did not appear to be filed by Respondent. For example, the suspect trademark applications contained an email address that did not appear to belong to Respondent, and some applications contained an invalid Utah bar number and a Utah mailing address that did not appear to be associated with Respondent. It appeared to the USPTO that some person or entity may be impersonating Respondent for the purpose of evading the U.S. Counsel Rule. Therefore, the USPTO sought Respondent’s assistance and cooperation in removing him from the record in any application where his name, signature, or bar information may have been used without his permission.

Respondent represents that he concurred with the USPTO’s action plan and proposed declaration, and submitted the signed declaration to supp01t the USPTO’s action. The declaration contained partially inaccurate, misstated, or misleading statements as to, inter alia, (a) whether Respondent agreed to serve as an attorney, correspondent, domestic representative, or signatory of the applicant or registrant, (b) whether there was reason for Respondent’s name or electronic signature to appear on any filing in connection with the applicant or registration, and (c) whether Respondent’s name appeared in the trademark applications without his prior knowledge. Respondent represents that he did not adequately review his records or the declaration prior to signing and submitting it to the USPTO. Respondent further represents and acknowledges that he incorrectly relied on the declaration as being the only course of action to correct the suspect trademark applications, Respondent sincerely regrets his inadequate preparation in examining the potentially contrary evidence to make an informed determination as to whether the statements in the declaration could be truthfully asserted.

Respondent represents that he was unaware that his electronic signature was entered on trademark applications and attendant declarations, and that he did not authorize Wen or Wen’s associates to enter his electronic signature on any trademark applications and attendant declarations.
Respondent, however, also acknowledges he would have been able to identify the impermissible signatures had he· been actively monitoring the applications being filed using his name and bar credentials.

Respondent represents to OED that he did not adequately understand the U.S. Counsel Rule during his business relationship with Wen, during his interactions with the staff attorney from the USPTO’s Trademark Legal Policy Office (“TM Policy”), and when signing the declaration. Respondent represents that he now fully understands the U.S. Counsel Rule and expresses contrition for his prior lack of understanding of the U.S. Counsel Rule and recognizes that his acts and omissions implicated many provisions of the USPTO Rules of Professional Conduct.

Respondent acknowledges that he has a responsibility to take corrective action for potential harm caused by agreeing to serve as U.S. Counsel for foreign-domiciled trademark applicants from his business relationship with Wen. Respondent has taken corrective actions by (a) directly contacting the applicant or registrant of the suspect trademark applications on whose behalf he was attorney of record at the USPTO to inform them about the unauthorized trademark filings and the impermissible signatures on their trademark applications and attendant declarations that do not comply with the USPTO trademark signature rules, and by (b) contacting the USPTO regarding each of the filings that was made in violation of the USPTO signature regulations.

The USPTO went on to state in the Order,

Trademark practitioners engaged in practice before the USPTO are to be reasonably well informed as to the U.S. Counsel Rule. The rule became effective on August 3, 2019, and requires applicants, registrants, and parties to a trademark proceeding whose domicile is not located within the U.S. or its territories to be represented by an attorney who is an active member in good standing of the bar of the highest court of a state in the U.S. See 84 FR 31498; 37 C.F.R. § 2.1 l(a).

In the years preceding the U.S. Counsel Rule’s effective date, the USPTO had seen many instances of unauthorized practice of law where foreign parties who are not authorized to represent trademark applicants were improperly representing foreign applicants before the USPTO. As a result, increasing numbers of foreign applicants were likely receiving inaccurate or no information about the legal requirements for trademark registration in the U.S., such as the standards for use of a mark in commerce, who can properly aver to matters and sign for the mark owner, or even who the true owner of a mark is under U.S. law. This practice raised legitimate concerns that affected applications and any resulting registrations are potentially
invalid, and thus negatively impacting the integrity of the trademark register. Hence, the USPTO implemented the requirement for representation by a qualified U.S. attorney in response to the increasing problem of foreign trademark applicants who purportedly were pro se (i.e., one who does not retain a lawyer and appears for himself or herself) and who were filing inaccurate and possibly fraudulent submissions that violated the Trademark Act and/or the USPTO’s rules. For example, such foreign applicants filed applications claiming use of a mark in commerce, but frequently supported their use claim with mocked-up or digitally altered specimens. This indicated the mark may not actually have been in use. Many foreign domiciled trademark applicants appeared to be acting on the advice, or with the assistance, of foreign individuals and entities who are not authorized to represent trademark applicants before the USPTO. This practice undermines the accuracy and integrity of the U.S. trademark register and its utility as a means for the public to reliably determine whether a chosen mark is available for use or registration, and places a significant burden on the trademark examining operation. See 84 FR at 31498-31499.

The U.S. Counsel Rule is intended to increase USPTO customer compliance with U.S. trademark law and USPTO regulations, improve the accuracy of trademark submissions to the USPTO, and safeguard the integrity of the U.S. trademark register. For example, practitioners who represent trademark applicants before the USPTO are expected to, among other things, undertake a bona fide review of specimens submitted to the USPTO in support of a trademark application. A practitioner’s failure to comply with his or her ethical obligations under the U.S. Counsel rule potentially adversely affects the integrity of the USPTO trademark registration process.

A redacted version of the Final Order is available here: FinalOrderD2021-8.

Author: Aaron Wininger

Aaron Wininger is a Senior Attorney and Director of China Intellectual Property at Schwegman Lundberg & Woessner.

Author: Aaron Wininger

Aaron Wininger is a Senior Attorney and Director of China Intellectual Property at Schwegman Lundberg & Woessner.