For years, I've witnessed firsthand how unfair practices in trademark regulations have favoured large charities at the expense of small businesses like mine. Navigating the complex world of trademark protection, small business owners are at a distinct disadvantage, encountering numerous obstacles that can hinder our growth and, at times, threaten our very survival.

The Small Business Trademark Protection and Anti-Fraud Act is a necessary measure that can reshape the commercial landscape.

Section 1. Short Title
This Act may be cited as the “The Small Business Trademark Protection and Anti-Fraud Act.”

Section 2. Findings and Purpose
(a) Findings: Congress finds that—
(1) The current United States Patent and Trademark Office (USPTO) fee structure creates a financial barrier for small businesses and individuals to oppose service marks that infringe upon their established commercial presence.
(2) The high cost of legal proceedings can be exploited to intimidate or financially exhaust small, legitimate businesses.
(3) There is a documented risk of entities, including large charitable organizations, using superior financial resources to acquire service marks for the purpose of displacing or coercing existing for-profit businesses.
(4) Attorneys have a professional and ethical duty not to engage in predatory legal practices that weaponize intellectual property law.
5) The purposeful misrepresentation of a service mark in commerce to deceive consumers and harm a competitor is a malicious act that undermines fair competition and causes significant economic damage.

(b) Purpose: The purpose of this Act is to—
(1) Reform USPTO trademark opposition procedures to eliminate financial burdens on small businesses defending their commercial identity.
(2) Prohibit the abusive use of service mark proceedings to target established for-profit businesses.
(3) Establish severe penalties for attorneys and entities who engage in such coercive practices.
(4) Criminalize the willful misrepresentation of a service mark for the purpose of harming a for-profit business.

Section 3. Definitions
In this Act:
(1) COVERED SMALL BUSINESS: The term "Covered Small Business" means a for-profit business with 50 or fewer employees that has been actively operating under a specific trade name or mark for a period of not less than 24 months prior to the filing of a challenged service mark application.
(2) GEOGRAPHIC AREA OF OPERATION: The term "Geographic Area of Operation" means the city, county, and a 100-mile radius wherein the Covered Small Business has a demonstrable commercial presence.
(3) COERCIVE SERVICE MARK PRACTICE: The term "Coercive Service Mark Practice" means the filing of a service mark application for the primary purpose of displacing, intimidating, or forcing the sale or cessation of a Covered Small Business.
(4) WILLFUL MISREPRESENTATION: The term "Willful Misrepresentation" means the use of a service mark in commerce, or in an application to the USPTO, with the deliberate intent to deceive the public by causing confusion as to the source, sponsorship, or origin of services, for the purpose of injuring a for-profit business.

Section 4. Reform of USPTO Opposition Procedures for Small Businesses
(a) FEE WAIVER FOR COVERED SMALL BUSINESSES: The Director of the USPTO shall establish a program to waive 100% of the filing fees for a Notice of Opposition or a Petition for Cancellation filed by a Covered Small Business.
(b) ELIGIBILITY: To be eligible for the fee waiver, the Covered Small Business must demonstrate that the opposed service mark is for a similar class of services and is intended for use in its Geographic Area of Operation.

Section 5. Prohibition on Coercive Service Mark Practices
(a) IN GENERAL: It shall be unlawful for any person or entity to file a service mark application as a Coercive Service Mark Practice.
(b) REBUTTABLE PRESUMPTION: A Coercive Service Mark Practice shall be rebuttably presumed if the applicant is a large organization (over 500 employees or annual revenue exceeding $10 million) filing a mark that is substantially similar to that of a Covered Small Business within its Geographic Area of Operation.

Section 6. Criminalization of Willful Misrepresentation of a Service Mark
(a) OFFENSE: It shall be a federal criminal offense for any person or entity to engage in the Willful Misrepresentation of a service mark for the purpose of harming a for-profit business.
(b) PENALTIES: Upon conviction, an individual shall be fined under this title, imprisoned for not more than 10 years, or both. An organization shall be fined not more than $5,000,000.
(c) MANDATORY RESTITUTION: A conviction under this section shall result in a mandatory order of restitution to the victim business for treble the amount of its proven financial losses.

Section 7. Attorney Accountability and Disciplinary Measures
(a) MANDATORY CERTIFICATION: Any attorney filing a service mark application must sign a certification, under penalty of perjury, affirming that the application is not a Coercive Service Mark Practice or a Willful Misrepresentation.
(b) DISCIPLINARY ACTION: Any attorney found to have knowingly participated in such practices shall be subject to immediate suspension from practice before the USPTO for a period of not less than 5 years for a first offense, and permanent disbarment for a second offense.
(c) CIVIL AND CRIMINAL LIABILITY: An attorney who violates this section shall be jointly and severally liable for all damages and may be prosecuted as a principal under Section 6 of this Act.

Section 8. Penalties for Violating Organizations
Any entity found to have engaged in a Coercive Service Mark Practice or Willful Misrepresentation shall be:
(1) Subject to the criminal fines outlined in Section 6.
(2) Permanently barred from obtaining the contested service mark.
(3) Liable for mandatory restitution to the victim business.

Section 9. Preemption
This Act shall supersede any state or local laws to the extent that such laws are inconsistent with the provisions of this Act.

Section 10. Effective Date
This Act and the amendments made by this Act shall take effect 180 days after the date of its enactment.