Second Substitute S.B. 151

Representative John Dougall proposes the following substitute bill:

1 TRADEMARK PROTECTION ACT AMENDMENTS
2 2008 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Dan R. Eastman
5 House Sponsor: David Clark
6
7 LONG TITLE
8 General Description:
9 This bill makes changes to Title 70, Chapter 3a, Registration and Protection of
10 Trademarks and Service Marks Act concerning the electronic registration of marked
11 and electronically-based advertising.
12 Highlighted Provisions:
13 This bill:
14 . eliminates provisions allowing registration and enforcement of an electronic service
15 mark;
16 . prohibits certain electronically-based advertising;
17 . addresses the establishment, maintenance, and funding of a database allowing
18 electronic registration and administration of trademarks and service marks; and
19 . makes technical changes.
20 Monies Appropriated in this Bill:
21 None
22 Other Special Clauses:
23 None
24 Utah Code Sections Affected:
25 AMENDS:

26 70-3a-103, as last amended by Laws of Utah 2007, Chapter 365
27 70-3a-203, as last amended by Laws of Utah 2007, Chapter 365
28 70-3a-302, as last amended by Laws of Utah 2007, Chapter 365
29 70-3a-304, as last amended by Laws of Utah 2007, Chapter 365
30 70-3a-305, as last amended by Laws of Utah 2007, Chapter 365
31 70-3a-306, as last amended by Laws of Utah 2007, Chapter 365
32 70-3a-402, as last amended by Laws of Utah 2007, Chapter 365
33 70-3a-501, as enacted by Laws of Utah 2007, Chapter 365
34 70-3a-502, as enacted by Laws of Utah 2007, Chapter 365
35
36 Be it enacted by the Legislature of the state of Utah:
37 Section 1. Section 70-3a-103 is amended to read:
38 70-3a-103. Definitions -- Use -- Service marks.
39 (1) As used in this chapter:
40 (a) "Abandoned mark" means a mark whose:
41 (i) use has been discontinued with no intent to resume use; or
42 (ii) significance as a mark has been lost due to any course of conduct of the owner,
43 including acts of omission or commission.
44 (b) "Applicant" means:
45 (i) the person filing an application for registration of a mark under this chapter; and
46 (ii) a legal representative, successor, or assign of a person described in Subsection
47 (1)(b)(i).
48 (c) "Dilution" means the lessening of the capacity of a famous mark to identify and
49 distinguish goods or services, regardless of the presence or absence of:
50 (i) competition between the owner of the famous mark and another person; or
51 (ii) the likelihood of:
52 (A) confusion;
53 (B) mistake; or
54 (C) deception.
55 (d) "Direct competitor" means a person who:
56 (i) is not the registrant; and

57 (ii) buys or sells similar goods or services in at least a portion of the same market as the
58 registrant.
59 [(d)] (e) "Division" means the Division of Corporations and Commercial Code within
60 the Department of Commerce.
61 [(e) (i) If the conditions of Subsection (1)(e)(ii) are met, "electronic registration mark"
62 means a word, term, or name that represents a business, goods, or a service.]
63 [(ii) The mark described in Subsection (1)(e)(i) is an electronic registration mark only
64 if it is:]
65 [(A) registered through the system described in Section 70-3a-501 ; and]
66 [(B) used by a person to identify and distinguish a business, goods, or a service of that
67 person from a business, product, or service of another person.]
68 (f) "Mark" means any trademark[,] or service mark[, or electronic registration mark]
69 entitled to registration under this chapter whether or not the trademark[,] or service mark[, or
70 electronic registration mark] is registered.
71 (g) "Registrant" means:
72 (i) the person to whom the registration of a mark under this chapter is issued; and
73 (ii) an authorized licensee, a legal representative, successor, or assign of a person
74 described in Subsection (1)(g)(i).
75 (h) (i) If the conditions of Subsection (1)(h)(ii) are met, "service mark" means:
76 (A) a word, term, name, symbol, design, or device; or
77 (B) any combination of words, terms, names, symbols, designs, or devices.
78 (ii) The mark described in Subsection (1)(h)(i) is a service mark only if it is used by a
79 person:
80 (A) to identify and distinguish the services of one person from the services of others,
81 including a unique service; and
82 (B) to indicate the source of the services, even if that source is unknown.
83 (i) (i) If the conditions of Subsection (1)(i)(ii) are met, "trademark" means:
84 (A) a word, term, name, symbol, design, or device; or
85 (B) any combination of words, terms, names, symbols, designs, or devices.
86 (ii) The mark described in Subsection (1)(i)(i) is a trademark only if it is used by a
87 person:

88 (A) to identify and distinguish the goods of that person from those manufactured or
89 sold by others, including a unique product; and
90 (B) to indicate the source of the goods, even if that source is unknown.
91 (j) "Trade name" means any name used by a person to identify a business or vocation
92 of that person.
93 (k) "Use" means the bona fide use of a mark in the ordinary course of trade, and not
94 made merely to reserve a right in a mark.
95 (2) For the purposes of this chapter, a mark is considered to be in use:
96 (a) on goods:
97 (i) when the mark is placed:
98 (A) in any manner on the goods or other containers;
99 (B) in any manner on displays associated with the goods or other containers;
100 (C) on the tags or labels affixed to the goods or other containers; or
101 (D) if the nature of the goods makes the placements referred to in Subsections
102 (2)(a)(i)(A) through (C) impracticable, on documents associated with the goods or the sale of
103 the goods; and
104 (ii) the goods are sold or transported in commerce in this state; and
105 (b) on services:
106 (i) when it is used or displayed in the sale or advertising of services; and
107 (ii) when the services are rendered in this state.
108 (3) For purposes of Subsection (1)(a):
109 (a) intent not to resume may be inferred from circumstances; and
110 (b) nonuse for two consecutive years is prima facie evidence of abandonment.
111 (4) Notwithstanding Subsection (1)(h), the following may be registered as service
112 marks notwithstanding that they may advertise the goods of the sponsor:
113 (a) titles;
114 (b) character names used by a person; and
115 (c) other distinctive features of:
116 (i) a radio program;
117 (ii) a television program; or
118 (iii) a program similar to a program described in Subsection (4)(c)(i) or (ii).

119 Section 2. Section 70-3a-203 is amended to read:
120 70-3a-203. Fees.
121 (1) (a) A regulatory fee, as defined in Section 63-38-3.2 , shall be determined by the
122 division in accordance with Section 63-38-3.2 , but may not exceed $250 annually for electronic
123 registration of [an electronic registration] a mark in a single class.
124 (b) A person who pays the annual regulatory fee for the electronic registration of [an
125 electronic registration] a mark may register additional classes for the same mark for an
126 additional fee not to exceed $25 annually.
127 (2) (a) For a fee authorized by this chapter that is not a regulatory fee, the division may
128 adopt a schedule of fees [provided that] if each fee in the schedule of fees is:
129 (i) reasonable and fair; and
130 (ii) submitted to the Legislature as part of the Department of Commerce's annual
131 appropriations request.
132 (b) When a fee schedule described in Subsection (2)(a) is submitted as part of the
133 annual appropriations request, the Legislature, in a manner substantially similar to Section
134 63-38-3.2 , may for any fee in the fee schedule:
135 (i) approve the fee;
136 (ii) (A) increase or decrease the fee; and
137 (B) approve the fee as changed by the Legislature; or
138 (iii) reject the fee.
139 (c) A fee approved by the Legislature pursuant to this section shall be deposited in a
140 restricted account within the General Fund known as the Commerce Service Fund.
141 Section 3. Section 70-3a-302 is amended to read:
142 70-3a-302. Application for registration.
143 (1) (a) Subject to the limitations in this chapter, any person who uses a mark may file
144 with the division an application for registration of that mark.
145 (b) The registration described in Subsection (1)(a) shall be filed in accordance with
146 rules:
147 (i) made by the division in accordance with Section 70-3a-201 ; and
148 (ii) that are consistent with this section.
149 (c) The application shall:

150 (i) state:
151 (A) the name and business address of the person applying for registration;
152 (B) if a corporation, the state of incorporation; and
153 (C) if a partnership:
154 (I) the state where the partnership is organized; and
155 (II) the names of the general partners, as specified by the division;
156 (ii) specify:
157 (A) the goods or services on or in connection with which the mark is used;
158 (B) the mode or manner in which the mark is used on or in connection with those
159 goods or services; and
160 (C) the class defined pursuant to Section 70-3a-308 in which those goods or services
161 fall;
162 (iii) state:
163 (A) the date when the mark was first used anywhere;
164 (B) the date when the mark was first used in this state by the applicant or a predecessor
165 in interest;
166 (C) that the applicant is the owner of the mark;
167 (D) that the mark is in use; and
168 (E) that to the knowledge of the person verifying the application, no other person has
169 registered, either federally or in this state, or has the right to use that mark:
170 (I) in the mark's identical form; or
171 (II) in such near resemblance to the mark as to be likely, when applied to the goods or
172 services of the other person, to cause confusion, mistake, or to deceive;
173 (iv) be signed, including by any signature consistent with the requirement for an
174 electronic signature under 15 U.S.C. Sec. 7001, under penalty of perjury by:
175 (A) the applicant; or
176 (B) if the applicant is not an individual:
177 (I) an officer of the applicant; or
178 (II) a partner of a partnership;
179 (v) be filed with the division;
180 (vi) be accompanied by two specimens showing the mark as actually used; and

181 (vii) be accompanied by a regulatory fee as determined by the division in accordance
182 with Section 70-3a-203 .
183 (d) In addition to the information required by Subsection (1)(c), the division may
184 require the applicant to provide:
185 (i) a statement as to whether an application to register the mark, or portions or a
186 composite of the mark, has been filed by the applicant or a predecessor in interest in the United
187 States Patent and Trademark Office; or
188 (ii) a drawing of the mark, complying with the requirements the division may specify.
189 (2) If the division requires the statement under Subsection (1)(d)(i), the applicant shall
190 provide full information with respect to any application filed with the United States Patent and
191 Trademark Office including:
192 (a) the filing date and serial number of the application;
193 (b) the status of the application; and
194 (c) if any application was finally refused registration or has otherwise not resulted in a
195 registration, the reasons for the refusal or lack of registration.
196 (3) Any materials, information, or signatures required to file an application for [an
197 electronic registration] a mark may be provided through the database created under Section
198 70-3a-501 .
199 Section 4. Section 70-3a-304 is amended to read:
200 70-3a-304. Certification of registration.
201 (1) If an applicant fully complies with this chapter, the division shall:
202 (a) certify the registration; and
203 (b) provide to the applicant documentation that the registration is certified.
204 (2) The documentation described in Subsection (1) shall:
205 (a) be affixed to the application of the applicant; or
206 (b) include the information that is required to be in an application under Subsections
207 70-3a-302 (1)(c)(i) through (iii).
208 (3) The following are admissible in evidence as competent and sufficient proof of the
209 registration of the particular mark in any action or judicial proceeding in any court of this state:
210 (a) the documentation described in Subsection (1)(b) that is provided by the division;
211 or

212 (b) a copy of the documentation described in Subsection (1)(b) if the copy is certified
213 by the division.
214 (4) Documentation of the certification of an [electronic registration] electronically
215 registered mark shall be provided through the database created under Section 70-3a-501 .
216 Section 5. Section 70-3a-305 is amended to read:
217 70-3a-305. Duration and renewal.
218 (1) The registration of a mark under this chapter expires five years after the date the
219 division certifies the registration under Section 70-3a-304 .
220 (2) A registration may be renewed for an additional five years from the date a
221 registration expires if the registrant:
222 (a) files an application with the division:
223 (i) at least six months before the expiration of the registration; and
224 (ii) in accordance with the requirements made by rule by the division:
225 (A) pursuant to Section 70-3a-201 ; and
226 (B) consistent with this section; and
227 (b) pays a renewal regulatory fee determined by the division in accordance with
228 Section 70-3a-203 .
229 (3) If a registrant complies with this section, the registrant may renew a mark at the
230 expiration of each five-year term.
231 (4) (a) A registration in effect before May 6, 2002:
232 (i) shall continue in full force and effect for the registration's unexpired term; and
233 (ii) may be renewed by:
234 (A) filing an application for renewal with the division:
235 (I) within six months before the expiration of the registration; and
236 (II) in accordance with rules made by the division pursuant to Section 70-3a-201 ; and
237 (B) paying the required renewal regulatory fee determined by the division in
238 accordance with Section 70-3a-203 .
239 (b) If a registration in effect before May 6, 2002, is renewed in accordance with this
240 Subsection (4), the registration shall be renewed for a term of five years.
241 (5) Any application for renewal under this chapter, whether a registration made under
242 this chapter or a registration made under a prior Utah statute, shall include:

243 (a) a verified statement that the mark has been and is still in use; and
244 (b) (i) a specimen showing actual use of the mark on or in connection with the goods or
245 services; or
246 (ii) a verified statement that the mark has not changed.
247 [(6) (a) An electronic registration mark is valid for one year from the day on which the
248 electronic registration mark is registered.]
249 [(b) Registration of an electronic registration mark may be renewed annually by paying
250 the fee for renewing an electronic registration mark described in Section 70-3a-203 .]
251 [(c) An electronic registration mark that is not renewed reverts to a trademark and
252 expires five years after the day on which the mark was originally certified unless renewed
253 under Subsection (2).]
254 [(d) Any existing trademark or service mark that otherwise qualifies for registration as
255 an electronic registration mark may be converted to an electronic registration mark by paying
256 the electronic registration mark fee under Section 70-3a-203 .]
257 Section 6. Section 70-3a-306 is amended to read:
258 70-3a-306. Assignments -- Changes of name -- Other instruments -- Security
259 interests -- Acknowledgments.
260 (1) (a) A mark and the mark's registration under this chapter is assignable with:
261 (i) the good will of the business in which the mark is used; or
262 (ii) that part of the good will of the business connected with the use of and symbolized
263 by the mark.
264 (b) An assignment under this section:
265 (i) shall be:
266 (A) in writing; and
267 (B) properly executed; and
268 (ii) may be filed with the division by:
269 (A) filing a form provided by the division; and
270 (B) paying of a fee determined by the division in accordance with Section 70-3a-203 .
271 (c) Upon the filing of an assignment, the division shall certify that the assignment has
272 been filed.
273 (d) An assignment of any registration under this chapter is void as against any

274 subsequent purchaser for valuable consideration without notice, unless the assignment is filed
275 with the division:
276 (i) within three months after the date of the assignment; or
277 (ii) before the subsequent purchase.
278 (2) Any registrant or applicant may change the name of the person or business to whom
279 the mark is issued or for whom an application is filed by:
280 (a) filing two copies of a certificate of change of name of the registrant or applicant
281 with the division; and
282 (b) paying of a fee determined by the division in accordance with Section 70-3a-203 .
283 (3) (a) A person may file another instrument that relates to a mark registered or
284 application pending under this chapter:
285 (i) in the discretion of the division; and
286 (ii) if the instrument is:
287 (A) in writing; and
288 (B) properly executed.
289 (b) An instrument that may be filed under this Subsection (3) includes:
290 (i) a license;
291 (ii) a security interest; or
292 (iii) a mortgage.
293 (4) An acknowledgment by the assignor or person whose interest in a mark is adversely
294 effected by the instrument:
295 (a) is prima facie evidence of the execution of an assignment or other instrument; and
296 (b) when filed by the division, is prima facie evidence of execution of the assignment
297 or other instrument.
298 [(5) An assignment and a name change of an electronic registration mark may be made
299 through the database created under Section 70-3a-501 .]
300 Section 7. Section 70-3a-402 is amended to read:
301 70-3a-402. Infringement.
302 (1) Subject to Section 70-3a-104 and Subsection (2), any person is liable in a civil
303 action brought by the registrant for any and all of the remedies provided in Section 70-3a-404 ,
304 if that person knowingly, whether directly or indirectly:

305 (a) uses a reproduction, counterfeit, copy, or colorable imitation of a mark registered
306 under this chapter:
307 (i) without the consent of the registrant; and
308 (ii) in connection with the sale, distribution, offering for sale, or advertising of any
309 goods or services on or in connection with which that use is likely to cause confusion, mistake,
310 or to deceive as to the source of origin, nature, or quality of those goods or services[;] to a
311 resident of this state; or
312 (b) reproduces, counterfeits, copies, or colorably imitates any mark and applies the
313 reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints, packages,
314 wrappers, receptacles, or advertisements intended to be used upon or in connection with the
315 sale or other distribution in this state of goods or services; or
316 [(c) uses an electronic registration mark to cause the delivery or display of an
317 advertisement for a business, goods, or a service:]
318 [(i) of the same class, as defined in Section 70-3a-308 , other than the business, goods,
319 or service of the registrant of the electronic registration mark; or]
320 [(ii) if that advertisement is likely to cause confusion between the business, goods, or
321 service of the registrant of the electronic registration mark and the business, goods, or service
322 advertised.]
323 (c) is a direct competitor who uses a registrant's mark that is registered electronically
324 through the database established in Section 7-3a-501 to deliver or display in the state an
325 advertisement for a business, good, or a service of the same class, as defined in Section
326 70-3a-308 , other than the business, good, or a service of the mark's registrant.
327 (2) Under Subsection (1)(b), the registrant is not entitled to recover profits or damages
328 unless the act described in Subsection (1)(b) has been committed with the intent:
329 (a) to cause confusion or mistake; or
330 (b) to deceive.
331 [(3) For a violation of Subsection (1)(c), the person whose business, goods, or service
332 is advertised, and the person who sells or displays the advertisement are liable if:]
333 [(a) the advertisement is at any time displayed in the state; or]
334 [(b) the advertiser or person selling the advertisement is located in the state.]
335 (3) For a violation of Subsection (1)(c), a person whose business, good, or service is

336 advertised, and the person who sells or displays the advertisement are liable if:
337 (a) the advertisement is at any time displayed in the state; and
338 (b) the advertisement is delivered using a system that has the ability to ascertain that
339 advertisement is delivered in the state; and
340 (c) the system described in Subsection (3)(b) has the ability to display different
341 advertisements in the state as advertisements displayed outside the state.
342 (4) It is not a violation of Subsection (1)(c) if the advertisement is displayed using a
343 system:
344 (a) that does not have the ability to ascertain that the advertisement is displayed in the
345 state; and
346 (b) that displays the same advertisements in the state as advertisements outside the
347 state.
348 (5) Any person who sells an advertisement for display in the state by the use of a
349 system that has the ability to ascertain the user's location and the capacity to display different
350 advertisements in the state than advertisements displayed outside the state, does not violate
351 Subsection (1)(c) if an advertisement delivered or displayed in the state prominently includes
352 the words "Paid Advertisement."
353 (6) This section is not violated if the content of an advertisement constitutes a fair use
354 under the federal system of trademark registration and protection.
355 Section 8. Section 70-3a-501 is amended to read:
356 70-3a-501. Searchable mark database.
357 (1) The division shall maintain a database that enables a user to:
358 (a) file an application to electronically register [an electronic registration] a mark;
359 (b) manage existing [electronic registration] marks owned by the user; and
360 (c) search for any registered marks.
361 (2) (a) The division may contract with a person to maintain and operate the database.
362 (b) If the division contracts with a person to maintain and operate the database, the
363 person with whom the division contracts may, at the discretion of the division, be responsible
364 for all costs of creating the database and readying it for use.
365 (3) [The] Notwithstanding Subsections 13-1-2 (3)(c) and 70-3a-203 (2)(c), the database
366 required by Subsection (1) shall be:

367 (a) directly funded by fees collected for the electronic registration of [electronic
368 registration] marks, including funding any data storage costs related to operation of the
369 database; and
370 (b) accessible online through the state's Internet website.
371 (4) For all registered marks, the database shall include:
372 (a) the date of a mark's registration;
373 (b) an indication of the mark's status as active or otherwise;
374 (c) any class for which the mark is registered; and
375 (d) the name of the registrant.
376 (5) A search of the information in the database that is listed in Subsection (4) shall be
377 available free to any user, without regard to whether the user has an account for use of the
378 database.
379 (6) The division may provide other services in connection with the database, for which
380 the division may charge a user.
381 (7) A person electronically registering [an electronic registration] a mark shall be given
382 an account through which the person may access the database to:
383 (a) review the status of a mark;
384 (b) pay any fee; and
385 (c) renew, revoke, and assign any [electronic registration] mark.
386 [(8) (a) The database shall provide a mechanism allowing a person to seek permission
387 from the registrant to use a registered electronic registration mark.]
388 [(b) The database shall allow, through use of the database, a registrant whose
389 permission is requested under Subsection (8)(a) to approve, disapprove, or approve with a time
390 limitation the request.]
391 [(c) (i) The division may charge a fee for a request for permission to use an electronic
392 registration mark under this Subsection (8).]
393 [(ii) No fee may be charged to the registrant from whom permission to use a mark is
394 requested.]
395 [(9) The creation of the database does not affect the registration of and fees for a
396 trademark or service mark.]
397 Section 9. Section 70-3a-502 is amended to read:

398 70-3a-502. Use of funds collected under this chapter.
399 [Any] Notwithstanding Subsections 13-1-2 (3)(c) and 70-3a-203 (2)(c), any funds
400 collected from the registration of a mark under this chapter or the use of the database in excess
401 of the expense of maintaining the database shall be retained as dedicated credits to be used by
402 the division to:
403 (1) promote the electronic registration of [electronic registration] marks to holders of
404 federal trademarks;
405 (2) promote the state as a desirable location for business; and
406 (3) provide incentives to businesses considering relocation to the state.