Regular readers of the Trademark and Copyright Law Blog and our Trademark Red Tape™ column may recall our previous report on a pilot study by the United States Patent & Trademark Office (PTO) about post-registration proof of use. Under current PTO practice, a specimen demonstrating use of a mark on a single good or service within a class is sufficient to maintain registration for an entire class, but owners of registrations selected under the pilot study were required to provide proof of use for additional goods and services. For the study, the PTO selected certain Section 8 and Section 71 maintenance filings (periodic proof of use filings for trademark registrants) and subjected them to enhanced evidentiary requirements. The underlying goal of the study was to evaluate and address the large amount of trademark “deadwood” or “chaff” — goods and services on which the mark is not actually used — on the register, and especially with regard to broad, multi-class, laundry-list-style registrations entering the system via foreign registrations under Section 44 or via the Madrid Protocol under Section 66.
Results of the Pilot Study
The pilot study was considered successful in that it (a) confirmed that the “deadwood” concern is quite real — the owners of more than half of the 500 selected registrations failed to supply additional proof of use for at least some goods and services — and (b) managed to “clean up” many of the selected registrations via deletion of certain goods or services, or in some instances cancellation of the underlying registration in its entirety.
On June 22, 2016, following the pilot study, the PTO issued a Notice of Proposed Rulemaking suggesting changes to the relevant regulations, 37 CFR 2.161 and 7.37, including the institution of a permanent post-registration proof of use program. Under the proposed program, the PTO would conduct random audits of “up to 10%” of the combined total of Section 8 and Section 71 affidavits filed each year in which the mark is registered for more than one good or service per class. Owners of selected registrations would be required to provide additional proof of use, including information, exhibits, affidavits, and specimens showing use for “some of” the additional goods and services.
Our Comments and Concerns
In general, implementing a permanent random audit program to clear out the deadwood seems a reasonable step in furtherance of the laudable goal of cleaning up the federal trademark register. However, we note below a few obvious concerns.
First, it is undisputed that the owners of randomly selected registrations will need to spend additional time, money, or both to comply with the enhanced requirements. The Notice of Proposed Rulemaking notes that the PTO “estimates it will take approximately one hour” for a registrant and its attorney to respond to an Office Action under the revised regulations, but this strikes us as overly optimistic and likely to vary depending on (a) the scope of the requirements and (b) the ability of the registrant to mobilize and pull together the required materials.
Second, if the random audit polls evenly from registrations issued under Section 1 (use in commerce), Section 44 (foreign registration), and Section 66 (Madrid Protocol), such efforts may be poorly focused. While the pilot study itself demonstrated that a significant percentage of Section 1(a) registrations had deadwood issues, a much larger portion of Section 44 and Section 66 registrations suffered such deficiencies. (A truly random sample is even more problematic, assuming that the majority of active registrations are based on Section 1).
The final potential complicating factor is the quality of post-registration review itself, which is typically conducted by post-registration paralegals rather than examining attorneys. There may be legitimate concerns as to whether the PTO will be able to effectively handle the increased post-registration requirements where, beyond the added workload, personnel will need to more carefully analyze the information and specimens provided by registrants.
The Notice of Proposed Rulemaking is open for comment until August 22, 2016.