On February 17, 2017, with little publicity, the U.S. Trademark Office adopted a final rule with “Changes in Requirements for Affidavits or Declarations of Use, Continued Use, or Excusable Nonuse in Trademark Cases.” Under the audit program, the USPTO randomly selects approximately 10 percent of maintenance and renewal filings and issues Office Actions to require additional proof of use of two items of goods or services specifically selected by the USPTO.  

What was amended?

The USPTO amended 37 CFR §2.161 (U.S. trademark registrations) and 37 CFR. The issues raised in the audit are independent of whether the evidence of use submitted in connection with a recently filed declaration or affidavit of use was acceptable. If the proof of use submitted does not meet the requirements of the audit, the examining attorney may issue a second office action requiring proof of use for all remaining goods or services. Therefore, registrants should be thorough when reviewing their registrations and making any changes to the identified goods or services. In a worst case, all of the goods or services could be deleted, and the registration canceled.

37 CFR §7 (Madrid Protocol International registrations) was amended to provide that the USPTO may require such information, exhibits, affidavits or declarations, and such additional specimens of use as may be reasonably necessary for the USPTO to assess and promote the accuracy and integrity of the register. The current rules mandate the submission of only one specimen per class in connection with a section 8 or section 71 affidavit unless additional information, exhibits, affidavits or declarations, or specimens are necessary for proper examination of the affidavit itself.

37 CFR 2.161(g), (h), 7.37(g), (h). This final rule will allow the USPTO to require additional proof of use of a mark not only to facilitate proper examination of section 8 or section 71 affidavit, but also to verify the accuracy of claims that a trademark is in use on or in connection with the goods/services identified in the registration.

What are my options for challenging the USPTO’s decision?

If the USPTO does not accept the evidence of use submitted in response to the audit, there may be options to challenge the refusal. For example, the registrant may be able to submit substantive arguments against the refusal, submit additional evidence, or appeal the decision to the Trademark Trial and Appeal Board or a U.S. court. Of course, any such actions are likely to involve substantial costs.

What can I do to prevent goods from being deleted from my registrations?

Trademark owners can take steps to minimize the impact of an audit on their portfolios that results in the removal of some or all of the goods or services from the trademark certificate.

1. Trademark owners should be sure to file only trademark applications that identify goods and services for which they make actual use of a label displaying the trademark and affixed to the goods or their containers or have a bona fide intention to use the mark.

2. Trademark owners should have document retention practices to preserve evidence of actual use of their mark in connection with covered goods and services during the life of the registration. Such practices may also be useful to preserve evidence of the bona fide intent to use a trademark for applications filed by intent to use, or for defense purposes in the event of a challenge to the validity of registration. Because evidence of use before the USPTO must be current, trademark owners and their outside counsel should be sure to update this evidence periodically.

3. Trademark owners may also wish to consider providing the USPTO with additional specimens of use during the initial filing of maintenance and renewal documents to proactively address the issues that would potentially be raised by an audit.

4. Trademark owners should be sure to review the identifications of goods and services carefully in trademark registrations subject to maintenance filings and delete items for which use has either ceased or never commenced.  If the Trademark owner uses SKU codes for its products, it is often useful to search each item of the proposed goods in the client’s SKU records to determine if any item has been deleted from the SKU list and is no longer being sold.

Part One