The plan is only effective if the trademark trolls are lazy. The Lanham act protects unregistered trademarks, making lawsuits and trolling still possible
Anna B. Folgers (IIT Chicago-Kent College of Law) “The Seventh Cir enth Circuit’s Approach to Deterring the To Deterring the Trademark Troll: Say Goodbye to Your Register our Registration and P ation and Pay the Costs of Litigation” September 01, 2007 3 Seventh Circuit Rev. 452 https://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?article=1173&context=seventhcircuitreview
The assumptions of long-term savings and deterrence as the result of cancellation is flawed for one important reason: because registration merely confers a presumption of the right to use, ownership, and validity, the loss of the registration results in only the loss of a registered right. Because trademark rights arise out of use and not registration, a party may still claim ownership of a valid mark at common law.186 Thus, a party like Stoller, who despite never winning one case and being forced to pay for all the costs of litigation in some, are keen on still filing suit may simply continue to do so. Although the presumptions of validity are not present, one can still claim rights to a mark based on mere use pursuant to common law and state claims of unfair competition. The Lanham Act still provides protection for unregistered marks. As such, the cancellation of a mark does not bar an ambitious trademark troll from bringing suit or threatening to file suit if a licensing agreement is not reached between the parties. Thus, deterrence and resulting long-term savings may be positive thinking rather than a realistic result of proactive cancellation by the courts. However, as discussed below, the threat of not only paying one’s own costs of litigation, but also the other party’s, may provide an even greater push to stop trademark trolls from filing suit for infringement of a mark they do not have rights in.