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25 June 2021TrademarksAlex Baldwin

USPTO sees surge in TM applications, accuses Chinese IP firm

The US Patent and Trademark Office (USPTO) is dealing with an “unprecedented” surge in trademark applications, causing delays in processing and reviewing, which could be linked to a number of suspected falsified applications from China.

According to a June 23 blog post from USPTO’s commissioner for trademarks David Gooder, the office has recorded a 63% increase in trademark applications from both US and foreign applicants year-on-year—which equates to around 211,000 additional applications.

In December alone, the USPTO received 92,608 applications, an increase of 172% over December 2019.

Gooder wrote: “We are continuing to explore the reasons behind the surge, but we do know that the increase comes from both foreign and domestic filings and is caused in part by an increase in e-commerce during the pandemic.

“We are keenly aware of this challenge and have taken steps to increase productivity, while maintaining the high quality our applicants expect.”

Among these steps, the office is implementing new technology solutions and enhancements to process applications quicker and has also hired more examining attorneys and staff in order to bring processing times “back to customary levels”.

Showing Cause

Amongst the reason for the spike could be thousands of improper trademarks from Chinese law firm Shenzhen Huanyee Intellectual Property, the USPTO suspects.

In a letter addressed to the firm and Yusha Zhang—a name that appeared in the correspondence fields of “dozens” of suspect applications—the USPTO alleges that the firm Shenzhen Huanyee has provided false information by entering signatures of thousands of third parties on applications and providing false information in trademark submissions “with the intent to circumvent the USPTO rules.”

The order asks the firm to show cause as to why the office should not immediately sanction it from submitting more applications and striking all further applications submitted by its employees.

According to the letter, Shenzhen Huanyee proclaims on its website that it has filed more than 30,000 foreign trademark applications, including in the US. It also claims to employ two US attorneys called “Nyxia” and “Gaulle”.

However, the USPTO says it is “unaware of any US trademark application or registration listing an email address associated with Huanyee that includes attorney information for any such persons”.

Therefore the office has accused the company of filing applications without proper legal representation, flagging more than 9,000 applications in the letter that it suspects to be linked to the Chinese firm.

“The potential impact is huge,” said Robert Reading, director of data company Clarivate in a Linkedin post.  “If other large China-based practices are also under investigation by the USPTO then tens and possibly hundreds of thousands of US trademark records could be found to have been incorrectly filed and therefore inadmissible and expunged from the US register.”

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