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I do believe that using the Registered Trademark symbol ® can only be only used if by the owner of a mark following registration with the U.S. Patent and Trademark Office

Why are designers adding the Registered Trademark symbol?

please do not tell me that it's for show...sorry to disappoint but legally it cannot be used.

True; 'TM' or 'SM' can be used by anyone; the actual registered trademark symbol can only be used by those who've registered thru USPTO as you stated.

There are so many designs using ® what do we do report to MODS and have them removed

I'm not sure.

I don't really think the designs should be pulled for it; there are probably non-US designers who aren't aware of the difference in marks (I know there are non-US *clients* that are unaware b/c I have them ask me to put it on designs all the time in my personal business.)

Does it really matter? We are not the police - certain practices designers do are at-your-own-risk.

Leave the responsibility with the designer and the CH. If neither do their homework, then they deserve to get burned.