The entire cost of a trademark cancellation can sometimes be minimal and affordable. Other times, it can be ridiculously expensive and prohibitive. Now, you’re probably wondering how that could possibly be the case. Well, the reason is because there are countless factors that greatly impact the cost of pursuing or defending a trademark cancellation. For example:
- Whether you’re the petitioner or the registrant
- Whether you choose to retain an attorney
- Whether the cancellation raises complex or novel issues of law or fact
- The number of grounds for cancellation pleaded by the petitioner
- The amount of effort and time you’re prepared to invest in the cancellation proceeding
- Whether the parties can privately resolve the trademark cancellation and how long it takes to reach a settlement
Although you’re certainly in control of some of these factors, many of them you have little or no control over. And when you don’t have control over the proceeding, the ability to calculate the total cost of a trademark cancellation can quickly become an exercise in futility.
Do I Need to Retain an Attorney?
By far, the largest portion of trademark cancellation costs are those associated with retaining an experienced and knowledgeable trademark attorney. But, do you have to retain an attorney to pursue or defend a cancellation? Can you figure everything out on your own and put all the money you would have spent on legal fees toward your next tropical vacation? Well, here’s what you need to know:
A person whose domicile (i.e. permanent place of legal residence) is within the United States doesn’t have to retain an attorney to represent him/her in a trademark cancellation. Likewise, a business entity that has its principal place of business or headquarters within the United States doesn’t have to hire an attorney. They are allowed to file a petition for cancellation, answer a petition for cancellation, and do everything else without the assistance of legal counsel. Obviously, the cost of a trademark cancellation is much less if you represent yourself before the Trademark Trial and Appeal Board (TTAB) and do all the legal research, writing, and filings yourself.
In contrast, an individual or entity that is “foreign-domiciled” must hire a U.S.-licensed attorney to either pursue or defend a cancellation proceeding. As such, the cost of a trademark cancellation for foreign-domiciled individuals/entities will unavoidably include attorney’s fees.
But even if you’re domiciled in the United States, the honest truth is that properly pursuing or defending a trademark cancellation without skilled legal representation is nearly impossible. There are just so many laws, rules, and regulations with which you have to comply in order to avoid finding yourself in a predicament and enduring the wrath of the TTAB. If you think that the TTAB is going to be lenient with you because you’re unrepresented, you better think again. It may happen occasionally, but that’s the exception and not the rule.
Bottom line: even if you’re domiciled in the United States and you don’t have to retain an attorney, I strongly encourage you to do so. Otherwise, you’re putting your interests and your trademark registration at a heightened level of risk.
What is the Cost of a Trademark Cancellation as the Petitioner?
If you’re the petitioner (meaning the one who’s pursuing the cancellation) and you choose to prepare/file the petition for cancellation without an attorney, it’s possible you may spend only a few hundred dollars in USPTO filing fees to successfully cancel a trademark registration. This scenario arises when the owner of the challenged registration doesn’t file an answer by the deadline. If the owner fails to file an answer, the TTAB will grant a default judgment in favor of the petitioner and the trademark registration will be canceled. Trademark cancellation done.
Of course, if the entire cost of a trademark cancellation proceeding ordinarily consisted of only the USPTO filing fee, I probably wouldn’t be writing this article.
Most often, the owner of the challenged trademark registration files an answer to the petition for cancellation and indicates its readiness to defend the cancellation. This forces you to do much more work in order to make your case to the TTAB, including drafting initial disclosures, preparing discovery requests, doing depositions, reading responses to discovery requests, researching legal issues, serving pretrial disclosures, taking testimony from relevant witnesses, preparing notices of reliance, properly authenticating and filing supporting evidence, and drafting a trial brief. Yes, these things can theoretically be done on your own at low or no cost. However, the vast majority of individuals will require the guidance of a trademark attorney to do them right. Furthermore, if it becomes evident that the cancellation proceeding isn’t going to be settled between the parties, you’ll need to carefully consider what your valuable time is worth since litigating most cancellations will take a minimum of 2-3 years.
What is the Cost of a Trademark Cancellation as the Registrant?
If you’re the registrant (meaning you’re the owner of the challenged trademark registration) and you decide to forgo retaining an attorney, the cost of a trademark cancellation could conceivably be nothing. How could that be? It’s because the registrant need only do a grand total of four things throughout the entire cancellation proceeding, all of which incur no direct payment of any fees to the TTAB or any third-party:
- File an answer to the petition for cancellation
- Participate in the discovery conference by the deadline noted in the TTAB schedule
- Draft and serve initial disclosures on the petitioner
- Timely respond to any discovery requests that the petitioner may serve
Now, I don’t want to mislead you into believing that, if you only do these four things, there’s a high probability you’ll win the cancellation. In fact, the opposite is true. If you don’t submit any evidence or arguments to effectively counter the petitioner’s case for cancellation of your trademark registration, the TTAB will almost definitely rule in the petitioner’s favor and you can kiss your registration goodbye.
So, you’re going to have to do a lot more than just these four things if you want any chance of successfully defending a trademark cancellation. And when I say a lot, I’m not exaggerating. If truth be told, you’ll need to pretty much do everything that the petitioner has to do after the answer is filed. Again, nearly all of these things can theoretically be done by yourself for free or at minimal cost. But I warn you that doing them properly without being intimately familiar with the TBMP and all other relevant statutes is not feasible. I’m not saying that to be mean or to attempt to frighten you. I’m saying it because the trademark cancellation process was designed with the assumption that the parties would obtain legal representation and not try to muddle through it themselves.
What’s the Cost If I Retain an Attorney?
There’s no getting around the fact that retaining an attorney is an expensive endeavor. Regardless of whether you’re the petitioner or the registrant, you can expect to pay an attorney between $200 per hour and $500 per hour depending on the attorney’s location, experience, and overhead expenses.
Some attorneys (including myself) offer a potential petitioner a flat-fee for preparing the petition for cancellation. Then, everything after that is charged on a time-expended basis. Plus, I don’t know a single attorney who doesn’t require a retainer in the amount of $3,000-$5,000.
Some attorneys (including myself) offer a registrant a flat-fee to try to amicably resolve the cancellation (instead of litigate it). But, that flat-fee will probably be at least $1,000-$1,500. In the event the cancellation can’t be settled, you’ll have to determine if providing your attorney with a large retainer and paying hundreds of dollars per hour defending the cancellation is something that’s realistic and within your budget.
It’s pretty easy to see how the cost of a trademark cancellation over a 2-3 year period could be tens of thousands of dollars (and maybe hundreds of thousands of dollars) due to the high hourly rates attorneys charge to help people navigate the complexities of legal proceedings like trademark cancellations. In some cases, these costs can be lessened by choosing not to take certain actions during the course of the cancellation proceeding. However, there are inherent risks associated with not aggressively litigating the cancellation if you’re committed to winning it.
Questions About Trademark Cancellation Costs?
I’m experienced US trademark attorney Morris Turek. Since 2005, I’ve been helping entrepreneurs, businesses, and organizations of all sizes pursue and defend trademark cancellation proceedings in front of the TTAB. If you would like to talk in greater detail about the cost of a trademark cancellation, feel free to call me at (314) 749-4059, send a message to morris@yourtrademarkattorney.com, or simply submit the contact form located toward the bottom of this page. I look forward to speaking with you soon.