December 27, 2021
Michael J. Pistorio

As part of its ongoing battle against fraudulently mass-filed trademark applications, the USPTO issued a final order for sanctions on December 10, 2021, against a Chinese trademark agency, Shenzhen Huanyee Intellectual Property Co., Ltd and its representative, Yusha Zhang. As a result of the investigation and the failure of the Chinese to resolve issues cited by the USPTO in a previous show cause order issued in June 2021, 15,000 trademark applications filed by the trademark agency have been canceled.

The USPTO determined that Huanyee advertised U.S. trademark registration services via its website, however, the agency did not have any U.S. licensed attorneys on staff. Despite this, the agency registered multiple USPTO accounts, advised clients on US trademark applications, submitted US trademark applications and documents, and engaged in trademark prosecution practices on behalf of their clients. In its response to the show cause order, Huanyee conceded that they violated USPTO rules, but argued that they were not aware that their conduct was against the rules and thus should not be sanctioned. The USPTO disagreed and found that their circumvention of the rules was “willful” and part of a “pattern of activity intended to circumvent the USPTO rules”.

The USPTO has been dealing with an influx of low-quality trademark applications from China that have been spurred by monetary incentives from the Chinese government for receiving intellectual property grants in foreign countries. The USPTO will also enact a new ID verification program for trademark filers beginning January 8, 2022. After April 9, 2022, if a trademark filer’s ID is not verified, they will not be able to file electronically on TEAS or TEASi.