Legislature(1995 - 1996)
02/19/1996 03:10 PM L&C
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 450 - ALASKA TRADEMARK ACT Number 050 CHAIRMAN PETE KOTT announced the first order of business the committee would address would be HB 450, "An Act relating to trademarks; amending Alaska Rule of Appellate Procedure 609; and providing for an effective date." WILDA WHITAKER, Legislative Administrative Assistant to Representative Gene Therriault, Alaska State Legislature, read the sponsor statement into the record: "This legislation is intended to update the State Trademark Act. Alaska's current law is modeled upon the 1964 Lanham Act. The proposed revision is to bring Alaska's trademark law current with the changes to the Lanham Act over the past 30 years, and is modeled closely to the Model State Trademark Bill written by the International Trademark Association. This revision will allow the registration of marks that currently cannot be registered under state law, such as service marks, certification marks and collective marks. The legislation was introduced at the request of the Division of Banking, Securities and Corporations. Passage of the legislation is needed to strengthen the intellectual property rights for Alaska's business community." MS. WHITAKER said in addition, she would like to ask for a simple amendment that would allow the department to implement regulations so they will be in effect by the time the bill becomes effective. An amendment is needed to be able to do that. Ms. Whitaker said there is a letter of support from Don and Rose Harris, Owners, Red Dog Saloon. She indicated they have had to fight several infringements on their trademark over the past several years. They have found existing law protection to be vague and almost impossible to defend. MS. WHITAKER noted the Department of Commerce and Economic Development has provided a position paper. The department says the major improvements are to broaden trademark protection to protect service providers, adding additional remedies to trademark owners for infringement and providing anti-dilution provisions for intellectual property owners whose trademark has become famous in this state. CHAIRMAN KOTT announced Representative Kubina arrived at 3:14 p.m. Number 288 MIKE MONAGLE, Supervisor, Records and Licensing, Division of Banking, Securities and Corporations, Department of Commerce and Economic Development, came forward to testify on HB 450. He informed the committee he is a member of the International Association of Trademark and Corporate Administrators (IATCA). Mr. Monagle explained that several years ago the United States Trademark Association, which is currently known as the International Trademark Association (INTA), approached his organization with the idea of updating the State Model Trademark Act. He noted the existing model dated back to the early 1960s. They saw a need to get a model out there that would bring in a lot of the changes that have taken place in the federal Lanham Act. They desired to see some consistency among the states as practicing attorneys who have to file at the federal level often ran into problems with various states having different variations of the law. They approved it. The Act has also been approved by the National Association of Secretaries of State and IATCA. He said it is his understanding that the American Bar Association Committee on Model Legislation has tentatively approved it and will formally do so within the next year. Number 389 CHAIRMAN KOTT said HB 450 refers to an applicant's entitlement to register a mark and asked what the general time frame would be that the commissioner could be expected to respond. MR. MONAGLE explained the commissioner who is listed in the existing law also is the officer who would file. He noted his agency is the dedicated agency that files on behalf of the commissioner. Their typical turnaround time is about a week of processing time and it shouldn't change. CHAIRMAN KOTT referred to the filing fee and asked what changes are expected. MR. MONAGLE said currently, the fee set out in statute is $10 per class code. You would have a separate registration for each class of goods that you registered under. Part of the bill takes that fee out of the statute and puts it into regulation. He noted he believes the fiscal note the committee has is based on a proposed fee of $50 per class code. Mr. Monagle said he realizes that is a substantial increase but there hasn't been a change in 30 years to that fee. A survey done by IATCA several years ago showed that the average fee charged by states was approximately $35 with about eight states charging anywhere from $50 to $100. Mr. Monagle explained the federal registration for a trademark is about $350 per class. CHAIRMAN KOTT asked if the amount is sufficient enough to cover the cost of the program. MR. MONAGLE explained there is currently one full-time person working 20 hours a week processing registrations. The term of the registration would also match what is being done with the federal act. Currently, the length of the registration is ten years and would be decreased to five years. The renewal fee would be the same as the initial registration which is similar to what it currently is. Number 570 REPRESENTATIVE KIM ELTON referred to a trademark registered with the federal government and asked if a person would also have to register it with the state. MR. MONAGLE said it is technically correct that they wouldn't have to register with the state. In practice, a lot of attorneys will register in each state on the assumption that litigation is cheaper or they avoid litigation if they register in each state in addition to the federal government. The reason is most states check with the federal government when they have a registration. What the practices will do is take a federal registration out and then make sure they get a registration in each state that their clients are doing business. The federal registration covers interstate commerce. Number 639 CHAIRMAN KOTT asked if there is a real problem being addressed by reducing the renewal from ten years to five years. MR. MONAGLE explained the intent is to get rid of the "dead wood." Once the registration goes into effect, that mark is tied up for ten years. Under the federal proposal, their initial registration is good, he thought, for one or two years. The person registering has to reaffirm that they are using that mark within that period and then it will be extended out for the remaining five years. He said he doesn't anticipate it would cause any problems. He noted all states have some type of renewal or assignment provision. Number 760 CHAIRMAN KOTT referred to wording in Section 12, "An application for renewal of a registration must include a verified statement that the mark has been used and is still in use", and asked Mr. Monagle to define "verified." MR. MONAGLE said typically for the department, it means a notarized signature on a statement that the mark is being used. The person signing the application would have a notarized signature. If it is a corporation it would be one of the officers, if it is a partnership it would be one of the general partners. CHAIRMAN KOTT referred to a business being in a rural area of the state where there isn't a notary available and asked what would be used. MR. MONAGLE explained he believes the under the notary laws, most postmasters can act as notaries. He said he also believes there is a provision under the Notary Act where you can have witnesses who can sign to your notarized signature. Number 820 CHAIRMAN KOTT said Section 15 talks about notifying those individuals who are going to have to reapply or re-register and that notification is sent out in writing by the department six months prior to the expiration. He asked if it is the department's intent to send that notification through certified or registered mail. MR. MONAGLE said they could, but don't currently do that. Currently, the department must send out notification of registrations that will expire after ten years. He said in 85 percent to 90 percent of the time, those addresses are no longer valid and most of that mail is returned as being undeliverable. He noted the department wouldn't have an objection to doing that sending them registered or certified. Number 898 REPRESENTATIVE ELTON referred to the fee going up, as indicated in the fiscal note, and said the department will be collecting the fee twice as often because the renewal will be changed from ten years to five years. He said the fee collection fund would grow substantially because instead of collecting once every ten years, it'll be done twice every ten years. MR. MONAGLE said that is correct. He noted the department doesn't have a tremendous number of these filings. Mr. Monagle said he has checked with the INTA and there isn't single attorney in the state of Alaska who is a member of that organization. The largest omission with the current act is it simply precludes most service providers, banks, insurance companies, etc., from registering. He said he doesn't think there will be a significant increase in revenue. REPRESENTATIVE ELTON said the record should reflect that he probably didn't mean that there is no intellectual activity in the state. Number 1017 There being no further discussion on HB 450, REPRESENTATIVE NORMAN ROKEBERG made a motion to move HB 450 out of the House Labor and Commerce Committee with individual recommendations and the attached positive fiscal note. CHAIRMAN KOTT asked if there was an objection. Hearing none, it was so ordered. HB 450 - ALASKA TRADEMARK ACT REPRESENTATIVE JERRY SANDERS referred to HB 450, "An Act relating to trademarks; amending Alaska Rule of Appellate Procedure 609; and providing for an effective date," which moved out of committee earlier in the meeting and said the committee neglected to adopt a proposed amendment. Number 1828 REPRESENTATIVE SANDERS made a motion to rescind the action of passing HB 450 out of committee. Hearing no objection, HB 450 was back before the committee. CHAIRMAN KOTT announced there is a proposed amendment in the committee packets which relates to the transition regulations and has an effective date of January 1, 1997. Number 1843 REPRESENTATIVE SANDERS made a motion to adopt Amendment 1. Hearing no objection, Amendment 1 was adopted. REPRESENTATIVE SANDERS moved to pass HB 450, as amended, with fiscal notes, out of committee with individual recommendations. There being no objection, CSHB 450(L&C) was passed out of the House Labor and Commerce Committee.