Economy Dips, Trademark Applications Soar: Yet Another Unexpected Outcome of 2020
Nehal Madhani | May 20, 2021
Nehal Madhani is the founder and CEO of Alt Legal, whose software makes it easy for law firms to create and manage IP filings. Before starting Alt Legal, Nehal practiced as an attorney at Kirkland & Ellis, LLP. He is a self-taught Python/Django programmer, and he served as a CodeX fellow at Stanford Law School. Nehal has a J.D. from the University of Pennsylvania Law School, a Certificate in Business and Public Policy from the Wharton School of Business, and a B.A. from Northwestern University.
Historically, in periods of economic downturn, new trademark filings tend to decline. For example, in September 2008 during the Great Recession and the collapse of Lehman Brothers, new filings with the USPTO decreased by 14% as compared with the prior year. Conversely, in times of economic prosperity, trademark applications tend to thrive. For example, in March 2000 when the internet bubble helped NASDAQ average hit a high, trademark filings with the USPTO peaked.
The COVID-19 pandemic radically altered the global economy and while we would have expected to see trademark activity plummet, trademark applications around the world unexpectedly surged. During the early stages of lockdown in March 2020, the USPTO began offering a series of concessions for applicants including relief for filing delays on foreign applications, relief for certain fees and deadlines, and more. The USPTO provided this relief in anticipation of a massive slowdown in applications, diminished cash flow, and overall business operations. Although these accommodations were certainly needed (particularly for those industries that were most hard hit), brand and business owners quickly rebounded. We’ve seen that the unique and unprecedented circumstances surrounding the pandemic have allowed new industries to emerge, and for some existing industries to become busier than ever. Certainly, many businesses have shut down, while others have shut down only temporarily. Unlike the Great Recession where all businesses suffered, the COVID-19 pandemic appears to have had a unique impact on the global economy. As businesses flourish, more than ever, it is important that brand owners invest in trademark applications early and often.
By the end of 2020, IP offices worldwide reported record numbers of newly-filed applications. Data shows that every major register (with the exception of Canada) experienced growth, sometimes double-digit growth, throughout 2020. Canadian trademark applications were down only 2%, and the reason why Canada did not show growth is likely due to a delay in processing Madrid Protocol designations. Overall, the increase in trademark applications globally since 2020 has been significant:
Asia-Pacific
- In China, trademark applications increased 20% in 2020 over 2019. (2)
- In South Korea, trademark applications increased 19% in 2020 over 2019. (2)
- For 2021, South Korea trademark filings are up 34% over 2020. (1)
- In India, trademark applications increased 13% in 2020 over 2019. (2)
- For 2021, India trademark filings are up 26% over 2020. (1)
Europe
- By the end of 2020, many European registers had set new records for annual filing volume. (2)
- European Union Intellectual Property Office (EUIPO) trademark applications increased 14% in 2020 over 2019. (2)
- For 2021, EUIPO trademark filings are up 23% over 2020. (1)
- United Kingdom trademark applications increased 31% in 2020 over 2019. (2)
- Germany trademark applications increased 14% over 2019 filings. (2)
Australia
- For 2021, Australia trademark filings are up 22% over 2020. (1)
So how in a year of global economic decline did we see trademark applications soar? While it’s difficult to attribute the increase to any one factor, there are some interesting emerging trends in global trademark applications.
Notable trends in global trademark applications
While we are seeing a rise in trademark applications over all classes of goods and services, many brands and business owners used the unprecedented circumstances surrounding the COVID-19 pandemic to release relevant products and services and they filed trademark applications accordingly. Brands and business owners responded to newly-created, albeit temporary needs (e.g. hospitals requiring more medical devices such as ventilators and respirators, and drug stores needing to supply more over-the-counter pharmaceuticals such as analgesics/antipyretics, cough suppressants/exportants, and decongestants). These brands and business owners proceeded to file trademark applications across the globe for pharma-related goods and services in Classes 5 (pharmaceuticals and medical supplies) and 10 (medical devices).
As a result, Classes 5 and 10 were the top two classes showing growth in the USPTO and EUIPO in the first half of 2020.
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In the USPTO during the first half of 2020, 15,000 trademark applications were filed in Class 5. Comparing the year-to-year data from April 2019 to April 2020, the growth rate was over 19% (4).
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In the USPTO during the first half of 2020, 8,000 trademark applications were filed in Class 10. Comparing the year-to-year data from April 2019 to April 2020, the growth rate was over 81% (4).
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In the EUIPO during the first half of 2020, 8,000 trademark applications were filed in Class 5. Comparing the year-to-year data from May 2019 to May 2020, the growth rate was over 36% (4).
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In the EUIPO during the first half of 2020, 5,000 trademark applications were filed in Class 10. Comparing the year-to-year data from April 2019 to April 2020, the growth rate was over 138% (4).
Conversely, the Singapore IP Office reported a dip in trademark applications relating to goods and services for hotels, food and beverages, and the entertainment and clothing industries. The Singapore IP Office attributed this decrease to the closures in leisure travel to Singapore as well as social-distancing measures taken in the country (5).
Another notable trend reported by the Korean IP Office is a significant increase in filings by small and medium-sized enterprises and individuals, increasing respectively by as much as 26.1% and 20.9% compared to 2019 (5).
Lastly, in the USPTO and elsewhere, there have been many newly-filed applications filed using the terms “COVID-19”, “Coronavirus”, and other related terms. As of May 2021 in the USPTO, there have been more than 600 marks filed using the term “Covid”, 55 marks filed using the term “Coronavirus”, and 54 marks filed using the term “Vaccinated.” In the US, many of the applications were filed by individuals unfamiliar with trademark law and therefore, many of the applications were refused based on genericness, descriptiveness, and failure to function.
What does this mean for brand and business owners?
As international filings surge, it is even more important for brand owners to ensure that they’ve secured their trademark rights internationally. Unlike the US which is a use-based system, many other jurisdictions follow a first-to-file system, in which timing is of the essence. It can be difficult to recover your IP rights if another party has already filed for the same or similar mark. As a result, we expect the rise in international trademark filings to continue.
Closing Thoughts
As we emerge from a difficult, year-long period marked by a global pandemic, a heated presidential election, and a painful call-to-action for civil rights, there is renewed hope. The availability of COVID-19 vaccines is allowing brand and business owners to pursue opportunities in 2021 with optimism. Increasingly, more businesses are feeding the consumer appetite for new products and services as we return to a “new normal.” In turn, they are filing new trademark applications and need to protect their brands domestically and internationally.
Alt Legal is here to support this exciting renaissance of new trademark filings with our newly-launched automated international trademark docketing. To learn more about Alt Legal’s automated international trademark docketing click here.
Sources:
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World Trademark Review, Early trademark data for 2021 reveals activity levels at major registers are off to a solid start, 2021.
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Clarivate CompuMark, The 2021 Trademark Ecosystem, 2021.
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JDSupra, Dechert LLP: 2021 Trends in Trademarks, April 1, 2021.
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Lisa Wright, Global Pharmaceutical Sector Sees Surge in 2020 Trademark Applications, July 16, 2020.
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World Trademark Review, Exclusive roundtable – IP offices reveal how covid-19 could shape future operations, April 29, 2021.