A Problem for Metaverse Trademark Applications: Premature Use

As the United States Patent and Trademark Office (“USPTO”) continues its relatively early review of the barrage of trademark applications focused on metaverses and non-fungible tokens (“NFTs”) that have been filed over the of the past year and one half over, the trademark agency provides information on how it considers/will deal with such applications and the trademarks involved. Primarily, as evidenced by its initial responses to an array of trademark applications filed by Nike for use in the virtual world, the USPTO has shed some light on what appropriate product/service descriptions look like for “metaverse” filings by excellence, namely, “downloadable virtual goods” (Class 9), “retail store services featuring virtual goods” (Class 35) and “entertainment services, namely, providing online non-downloadable virtual shoes, clothing … for use in virtual environments” (Class 41).

A number of additional responses from the USPTO take into account the risk of confusion and non-operation (as TFL dove into here), and yet a few other actions from the trademark office suggest that another issue merits consideration. to be taken into account when it comes to trademark applications in this field: “Premature use”.

As TFL reported in April, the USPTO first raised this concern in response to a registration request that Yuga Labs filed in May 2021 for the “Bored Ape Yacht Club” for use in connection with “digital collectibles; digital collectibles sold as non-fungible tokens” (Class 16), “maintain[ing] and save[ing] ownership of digital artwork; maintain[ing] and save[ing] ownership of digital artwork represented by non-fungible tokens; providing a website featuring an online marketplace for trading digital collectibles” (Class 35) and “online social networking services provided via a members-only website; computer services, namely creating an online community allowing registered users to access a collaborative graffiti board” (Class 45).

In a non-final Office action in March, a USPTO examining attorney refused to register the word mark BAYC due – in part – to “premature use” in Class 45. ‘USPTO on this front only focuses on the specimen that Yuga submitted with his application, which consists of screenshots from the BAYC website that show the interior of the yacht club bar; describes the BAYC collection, member access/benefits, and community tools; and sets “goals” for the project, such as “unlocking” the BAYC product store, among others.

The issue of prematurity arises, according to examining attorney Megan Clifford, because while Yuga’s Class 45 identification includes “computer services, namely the creation of an online community for registered users to access a collaborative graffiti painting,” the specimen he provided as evidence of how he uses the mark in connection with these services suggests that such use has not occurred – yet. The specimen “indicates that ‘The Bathroom’, the plaintiff’s online graffiti board, ‘will become operational once the pre-sale is complete,'” Clifford claims. “Accordingly, Applicant is not using the requested mark in connection with the identified Class 45 services” – at least not based on the specimen at issue. (Emphasis courtesy USPTO.)

Given the above, Clifford states that Yuga can either submit a new specimen that “was actually used in commerce at least as of the date the application was filed or prior to the filing of an amendment to allege use”, and that shows the BAYC mark “in actual use in commerce for the goods and/or services identified in the application or amendment to allege use.” Alternatively, Yuga may change its intent-to-use deposit basis (under Section 1(b)) to avoid having to produce a specimen at this stage.

It is not immediately clear what Yuga will choose to do, as he has yet to respond to the Bureau’s action; however, it should be noted that the graffiti chart appears to be accessible to BAYC NFT holders based on relevant media reports.

Not the only party currently facing a “premature use” denial, Clinique received non-final action from the Bureau this spring for the application which it filed in November 2021 for its name to be used on “non-fungible tokens (NFTs) and other application tokens” falling within Class 9 and “providing online non-downloadable virtual goods, namely, ‘digital art, photographs, video or audio recordings’ in Class 42. In an Office action in May, USPTO Examiner Abigail Lueken initially refused to register Clinique’s word mark “because the specimen shows that [it] has not used the mark applied for in commerce in connection with the goods and services identified on the date of filing of the application.

Metaverse Trademark

The specimen that Clique filed with the USPTO to show that it uses the mark in commerce in Classes 9 and 42 consists of screenshots of its e-commerce site, including pages that advertise a chance to win his “first NFT” with “an assortment of [tangible] products.” (In a replacement specimen Clinique filed in February, it highlights the use of its word mark on the webpage as well as a “buy everything” button (which presumably refers to its offering of physical products) as well as the message about the NFT contest.)

Disputing the specimen, Lueken states that “the specimen advertises the possibility of winning NFTs in a contest which has not yet taken place, and therefore the specimen does not demonstrate use of the mark in commerce in association with the goods and services identified in the application.” If Clinique’s products “were sold or transported or services were rendered in commerce on the date of filing of the application”, it specifies that the company must submit a new specimen showing use of the mark in this way. The Estee Lauder-owned cosmetics company’s response to the Bureau’s action is not expected until November.

Taken together, the two Office actions highlight another hurdle faced by trademarks that have filed Metaverse and NFT-centric registration applications based on Section 1(a) (i.e. ie, claiming actual commercial use) may be faced in this relatively uncharted territory. . (It should be noted, of course, that to date, 1(a) applications are relatively few; as most brands have filed NFT and metaverse-focused applications based on the intent of use amid a large-scale rush to file applications for such new technology that has been ongoing since last year.)

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