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Trend for trademark disputes is to go through ADR

Proceedings are often quicker and less expensive than court actions

By Michael Coakley and Kristen Isaacson Spano
Dolan Media

Detroit, MI — Trademarks are powerful intangible assets. Businesses invest substantial resources to develop and establish brands that distinguish themselves from competitors and build consumer recognition of their products and services.

When disputes involving trademarks arise, parties often turn to litigation or proceedings filed before the Trademark Trial and Appeal Board, the administrative tribunal of the United States Patent and Trademark Office. However, the trend in recent years has been toward using various forms of alternative dispute resolution.

There are several benefits that lead parties to ADR, including the ability to limit and customize discovery; select a neutral party with trademark experience to hear the case; choose the time and location of the hearing; and explore creative business solutions for resolving the dispute. In addition, ADR is typically less expensive and involves a smaller time commitment than litigation and TTAB proceedings.

Regardless of the method, ADR can be extremely beneficial to parties looking for a quick, cost-effective way to resolve their disputes. Recognizing this fact, the TTAB encourages parties to consider ADR as a means of settling opposition and cancellation proceedings.

Although most of these proceedings are decided prior to trial, the TTAB has noted that “alternative dispute resolution techniques might produce an earlier, mutually agreeable resolution of [the] dispute or might, at least, narrow the scope of discovery or the issues for trial,” leading to monetary and time savings for the parties.

There are myriad ADR sponsoring/administrative organizations, many of which have specialized rules for intellectual property matters. For example, the American Arbitration Association has a set of rules designed specifically for the resolution of patent disputes (adr.org; Resolution of Patent Disputes Supplementary Rules). Such arbitration is specifically authorized and governed by statute (35 U.S.C. 294).
In addition, AAA maintains specialized patent, trademark and copyright panels so that litigants can tap subject matter expertise for the resolution of their disputes in contrast to courts where litigants are subject to the luck of the draw and where the likelihood of getting a jurist with both the interest and knowledge to effectively adjudicate an intellectual property dispute is small.

Arbitration awards are generally enforceable in court for all types of intellectual property disputes, including patent interferences (25 U.S.C. 135). And, contrary to popular belief, temporary restraining orders/preliminary injunctions are available in AAA arbitration under the rubric “interim relief,” and interim awards are enforceable in court just like other arbitration awards.

A relatively new entrant to intellectual property ADR administration is the International Trademark Association. INTA maintains a roster of highly qualified neutrals, which must be associated with an INTA member, and have 15 years of trademark experience and either 16-20 hours of training or 10 years of experience plus certain experience as a mediator. INTA neutrals are also located in a broad range of geographic locations in order to increase proximity to the parties.

To foster ADR in trademark disputes, INTA has developed a Brand Owners Pledge and a Law Firm Pledge. The pledges are filed with INTA and the owner’s and law firm’s names and addresses are published on INTA’s website so disputants and their counsel can determine whether their opposition has pledged. INTA also has published Mediation Guidelines and Rules, which parties can adopt or adapt to meet their needs (see www.inta.org/adr).

Other organizations host IP ADR processes, and as ADR is a creature of contract, almost any forum can do so. The mediation section of the INTA website contains a useful directory of links to various IP ADR providers. Some worth highlighting are Uniform Domain-Name Dispute Resolution Policy providers accredited by the Internet Corporation for Assigned Names and Numbers.

ICANN is the international nonprofit organization responsible for managing and coordinating the internet’s domain name system, including IP address space assignments and accrediting domain registrars. The UDRP is an ADR policy ICANN adopted for trademark disputes involving alleged abusive registration of domain names. All ICANN-accredited domain name registrars must adopt the UDRP.

Like other methods of ADR, UDRP proceedings are often quicker and less expensive than court actions. UDRP complaints cost approximately $1,300-$1,600 for a single domain reviewed by one neutral/panelist. If the trademark owner receives a favorable ruling, the domain name will be transferred to the trademark owner within 10 days, unless the registrant files a court action to prevent the transfer.

In today’s Internet world, where brand and identity are practically the whole game, a fast, effective, cost-efficient mechanism for resolving Internet disputes, such as the UDRP, is indispensable.

The UDRP is emblematic of the sea change in IP dispute resolution underway. This change is not so much in derogation of the traditional court or agency action, but is complementary and supplementary to traditional processes, offering disputants and their counsel a whole menu of options from which to choose and tailor a dispute resolution mechanism that best suits the circumstances.

ADR has definitely come to intellectual property and is here to stay.

Michael Coakley and Kristen Isaacson Spano are principals at Miller, Canfield, Paddock and Ston, PLC.


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