Trademark Fee Adjustment, 37040-37057 [2020-13262]
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Federal Register / Vol. 85, No. 119 / Friday, June 19, 2020 / Proposed Rules
This notice is issued under the
authority of 46 U.S.C. 70003 and 5
U.S.C. 552.
Dated: June 10, 2020.
R.V. Timme,
Rear Admiral, U.S. Coast Guard, Assistant
Commandant for Prevention Policy.
[FR Doc. 2020–12910 Filed 6–18–20; 8:45 am]
BILLING CODE 9110–04–P
DEPARTMENT OF COMMERCE
Patent and Trademark Office
37 CFR Parts 2 and 7
[Docket No. PTO–T–2019–0027]
RIN 0651–AD42
Trademark Fee Adjustment
United States Patent and
Trademark Office, Department of
Commerce.
ACTION: Notice of proposed rulemaking.
AGENCY:
The United States Patent and
Trademark Office (Office or USPTO)
proposes to set or adjust certain
trademark fees, as authorized by the
Leahy-Smith America Invents Act
(AIA), as amended by the Study of
Underrepresented Classes Chasing
Engineering and Science Success Act of
2018 (SUCCESS Act). The proposed fees
are intended to recover the prospective
aggregate costs of future strategic and
operational trademark and Trademark
Trial and Appeal Board (TTAB or
Board) goals (based on workload
projections included in the USPTO
fiscal year (FY) 2021 Congressional
Justification), including associated
administrative costs. The proposed fees
will further USPTO strategic objectives
by: Better aligning fees with costs,
protecting the integrity of the trademark
register, improving the efficiency of
agency processes, and ensuring
financial sustainability to facilitate
effective trademark operations. Before a
final rule is issued, the USPTO will
consider the state of the U.S. economy,
the operational needs of the agency, and
public comments submitted pursuant to
this rulemaking. The USPTO will make
adjustments as necessary to the
substance and timing of any final rule
based on all of these considerations.
DATES: Written comments must be
received on or before August 3, 2020.
ADDRESSES: The USPTO prefers that
comments be submitted electronically
via email to TMFRNotices@uspto.gov.
Written comments may also be
submitted by mail to Commissioner for
Trademarks, P.O. Box 1451, Alexandria,
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SUMMARY:
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VA 22313–1451, attention Catherine
Cain; by hand delivery to the Trademark
Assistance Center, Concourse Level,
James Madison Building-East Wing, 600
Dulany Street, Alexandria, Virginia
22314, attention Catherine Cain; or via
the Federal eRulemaking Portal. See the
Federal eRulemaking Portal website
(https://www.regulations.gov) for
additional instructions on providing
comments via the portal. All comments
submitted directly to the USPTO or
provided on the Federal eRulemaking
Portal should include the docket
number (PTO–T–2019–0027).
Although comments may be
submitted by postal mail, the USPTO
prefers to receive comments
electronically because the Office may
more easily share such comments with
the public. The USPTO prefers that
comments submitted electronically be
in plain text, but they also may be
submitted in portable document format
(PDF) or a word processing file format
(DOC or DOCX). Comments not
submitted electronically should be
submitted on paper in a format that
facilitates convenient digital scanning
into PDF.
The comments will be available for
public inspection on the USPTO’s
website at https://www.uspto.gov, on the
Federal eRulemaking Portal, and at the
Office of the Commissioner for
Trademarks, Madison East, Tenth Floor,
600 Dulany Street, Alexandria, Virginia
22314. Because comments will be made
available for public inspection,
information that is not desired to be
made public, such as an address or
phone number, should not be included.
FOR FURTHER INFORMATION CONTACT:
Catherine Cain, Office of the Deputy
Commissioner for Trademark
Examination Policy, at 571–272–8946,
or by email at TMPolicy@uspto.gov.
SUPPLEMENTARY INFORMATION: The
USPTO conducted a fee assessment in
January 2019 that formed the basis for
this regulatory process to propose
adjusting and setting new trademark
user fees. While trademark-related costs
of operations have risen, trademark fees
have not changed since January 2017.
The revenue and workload assumptions
in this notice of proposed rulemaking
(NPRM) are based on the assumptions
found in the FY 2021 Congressional
Justification. However, projections of
aggregate revenues and costs are based
on point-in-time estimates, and the
circumstances surrounding these
assumptions can change quickly.
Notably, since the FY 2021
Congressional Justification was
published, fee collections have been
lower than anticipated, in part due to
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lower than expected application filings
as a result of the COVID–19 outbreak.
The USPTO is also mindful of the
current difficulties many USPTO users
are experiencing as a result of the
pandemic. The USPTO has undertaken
many efforts to provide various types of
relief, including deadline extensions
and fee postponements. Ultimately, the
goal of the USPTO is to ensure not only
that businesses and entrepreneurs can
weather this storm, but that they can hit
the ground running once it passes.
The USPTO anticipates that the
earliest any proposed trademark fee
changes could take effect is October
2020. Before a final rule is issued, the
USPTO will consider the state of the
U.S. economy, the operational needs of
the agency, and public comments
submitted pursuant to this NPRM. The
USPTO will make adjustments as
necessary to the substance and timing of
any final rule based on all of these
considerations.
As part of the multi-year fee-setting
process, the Trademark Public Advisory
Committee (TPAC) held a public
hearing at the USPTO on September 23,
2019. The Office considered and
analyzed all comments, advice, and
recommendations received from the
TPAC before publishing this NPRM. The
USPTO is now moving to the next step
in the process. This NPRM proposes
changes to fees and also proposes new
fees in order to solicit public comment.
Purpose: The USPTO protects
consumers and provides benefits to
businesses by effectively and efficiently
carrying out the trademark laws of the
United States. As a fee funded agency,
appropriate fees are critically important
for the USPTO to maintain the quality
and timeliness of examination and other
services, and to stabilize and modernize
aging information technology (IT)
infrastructure. The fee schedule
proposed in this rulemaking will
recover the USPTO’s aggregate
estimated future costs and ensure the
USPTO can achieve strategic and
operational goals, such as effectively
using resources to maintain low
trademark pendency and high quality,
fostering business effectiveness
(ensuring quality results for employees
and managers), stabilizing and
modernizing trademark IT systems,
continuing programs for stakeholder
and public outreach, enhancing
operations of the TTAB, and ensuring
financial sustainability to facilitate
effective trademark operations.
Section 10 of the AIA authorizes the
Director of the USPTO (Director) to set
or adjust by rule any fee established,
authorized, or charged under the
Trademark Act of 1946, 15 U.S.C. 1051
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et seq., as amended (the Trademark Act
or the Act) for any services performed
by, or materials furnished by, the Office.
See section 10 of the AIA, Public Law
112–29, 125 Stat. 284, 316–17, as
amended by the SUCCESS Act, Public
Law 115–273, 132 Stat. 4158. Section 10
of the AIA prescribes that trademark
fees may be set or adjusted only to
recover the aggregate estimated costs to
the USPTO for processing, activities,
services, and materials relating to
trademarks, including administrative
costs to the USPTO with respect to such
trademark and TTAB operations.
However, this authority includes the
flexibility to set individual fees to
advance key policy objectives. Thus, the
Director may set individual fees at,
below, or above their respective
associated costs, while taking into
account the aggregate estimated costs to
the USPTO.
Section 10 of the AIA also establishes
certain procedural requirements for
setting or adjusting fee regulations,
including public hearings by, and input
from, the TPAC. See section 10(c) of the
AIA, Public Law 112–29, 125 Stat. at
317. Accordingly, on August 28, 2019,
the Director notified the TPAC of the
USPTO’s intent to set or adjust
trademark fees and submitted a
preliminary trademark fee proposal with
supporting materials, available at https://
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
On September 23, 2019, the TPAC
held a public hearing in Alexandria,
Virginia. Transcripts of this hearing and
comments submitted to the TPAC in
writing are available for review at https://
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
The TPAC subsequently released a
report (TPAC report), dated October 31,
2019, regarding the preliminary
proposed fees. The report recognized
that fee adjustments are warranted to
achieve strategic and operational goals
and evaluated the various proposed fees
in view of the USPTO’s stated rationales
for setting or adjusting fees for certain
services and activities, as well as the
public comments regarding the fee
proposals. The TPAC report expressed
support for an increase in fees that
would support USPTO operations by
recovering costs and maintaining a
sufficient operating reserve but raised
concerns regarding some of the
proposed fee increases and their
potential impact on customers. The
TPAC report offered recommendations
to address these concerns. The report is
available at https://www.uspto.gov/
about-us/performance-and-planning/
fee-setting-and-adjusting.
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After careful consideration of the
comments and recommendations
provided in the TPAC report and in
testimony by users at the public hearing,
and keeping in mind the fee setting
goals of this proposed rule, the USPTO
has made various changes to the initial
fee proposal, including the withdrawal
of proposed fees for filing a motion for
summary judgment and for filing a
request for suspension and remand and
the proposed increase in the fee for
filing an affidavit under section 15 of
the Act. Other fees in the preliminary
proposal were retained or modified, as
reflected in this proposed rule and
explained in further detail below. The
USPTO seeks comments on the fee
proposals, including in relation to the
current environment.
The USPTO estimates, based on the
assumptions found in the FY 2021
Congressional Justification, that the
additional aggregate revenue derived
from the proposed fee schedule will
recover the future costs of implementing
strategic and operational goals,
including the cost of necessary IT
stabilization and modernization
activities, with the expectation that the
proposal will gradually build the
operating reserve to achieve sustainable
funding that will mitigate the risk of
immediate unplanned financial
disruptions. Under this proposal, based
on the assumptions found in the FY
2021 Congressional Justification, the
Office estimates reaching the optimal
six-month trademark operating reserve
level in FY 2025.
Summary of major provisions: The
USPTO proposes to set or adjust
trademark fees codified in 37 CFR parts
2 and 7. Fees are proposed to be
increased for all application filing types
(i.e., paper applications, applications
filed via the Trademark Electronic
Application System (TEAS), and
requests for extension of protection
under section 66(a) of the Trademark
Act, 15 U.S.C. 1141f). The proposed perclass fee increases range from $25 for a
TEAS Plus application to $150 for a
paper application. Fee increases of $100
per class are also proposed for filing
affidavits or declarations of use or
excusable non-use under section 8 or
section 71 of the Act (section 8 or
section 71 affidavits), 15 U.S.C. 1058,
1141k. As described in further detail
below, these proposed increases address
policy considerations related to
ensuring a more accurate register as well
as reflecting increased processing costs
to the Office in handling these filings.
This proposed rule creates two levels
of fees for petitions, one for petitions to
the Director under §§ 2.146 and 2.147
and a lower fee for a petition to revive
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an abandoned application under § 2.66.
Currently, the fees for these petitions are
$200 if filed on paper and $100 if filed
through TEAS. The USPTO proposes to
set the fee for petitions under §§ 2.146
and 2.147 at $350 if filed on paper and
$250 if filed through TEAS. The fees for
a petition to revive under § 2.66 are
proposed to be set at $250 if filed on
paper and $150 if filed through TEAS.
These proposed fees take into account
the different processing costs of these
filings.
New fees are proposed for requests for
reconsideration under § 2.63(b)(3) that
are filed more than three months after
the issue date of a final action (at $500
for paper filing and $400 for filing
through TEAS or the Electronic System
for Trademark Trials and Appeals
(ESTTA)). Requests for reconsideration
are documents filed after a final action
that respond to the outstanding refusals
or requirements (see Trademark Manual
of Examining Procedure (TMEP)
§ 709.05). They include an applicant’s
request to the TTAB, filed within six
months of the issue date of a final
action, whether filed with or after a
notice of appeal and whether it is
denominated as a request for
reconsideration or is captioned as
something else, such as a request for
remand. It does not include any filing
with the TTAB after the applicant has
filed its appeal brief (see Trademark
Trial and Appeal Board Manual of
Procedure (TBMP) § 1209.04). This new
proposed fee, imposed when the filing
is more than three months after the
issue date of a final action, is designed
to encourage applicants to submit these
filings earlier in the response period and
to recover costs associated with
processing all requests for
reconsideration.
A new $50 fee is also proposed for
filing a letter of protest, along with new
regulations that codify letter-of-protest
procedures. The new proposed fee and
procedures are designed to help offset
processing costs and deter the filing of
unsupported or irrelevant letters of
protest, while not discouraging the
filing of relevant, well-supported letters
of protest. The new regulatory section is
based on existing, longstanding
procedures for letters of protest, which
are currently set forth in the TMEP, as
well as the procedures set out in the
patents rules in 37 CFR 1.290 and 1.291
and the Manual of Patent Examining
Procedure (MPEP) governing third-party
submissions concerning pending
applications, which serve a function
similar to letters of protest.
The Office proposes a new fee
structure to encourage registrants to
proactively perform sufficient due
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diligence before filing a section 8 or
section 71 affidavit to determine the
goods or services for which the
registered mark is no longer in use and
delete them from the registration. The
USPTO herein proposes two fee levels
for amendments to registrations to
delete goods, services, and/or classes.
The USPTO proposes a $0 fee if the only
amendment made in a request under
section 7 of the Act (section 7 request),
15 U.S.C. 1057(e), that is filed prior to
submission of a section 8 or section 71
affidavit is the deletion of goods,
services, and/or classes. As always, no
additional fee would be incurred for
section 8 or section 71 affidavits that
specify fewer than all of the goods or
services listed in the registration when
the affidavit is filed, which results in
the deletion of goods or services not
included in the affidavit from the
registration. However, if goods, services,
and/or classes are deleted in a section
7 request, a response to Office action, or
a voluntary amendment after
submission and prior to acceptance of a
section 8 or section 71 affidavit, the
proposed per-class fee of $250 for
submissions filed through TEAS and
$350 for submissions permitted to be
filed on paper would be charged. To
implement the new fee requirement,
corresponding new regulations are also
proposed at §§ 2.161(c) and 7.37(c). In
addition, the USPTO proposes to revise
the section titles and restructure
§§ 2.161 and 7.37 to set out the
requirements for section 8 and section
71 affidavits more clearly. Except for the
new provision regarding the fee
required for deletions made after
submission and prior to acceptance of
the affidavit, the substantive text of
§§ 2.161 and 7.37 has not otherwise
been revised.
Finally, as discussed below, 16 fees
related to TTAB filings are established
or adjusted in this proposed rule: 10
fees would be increased for initiating a
proceeding, and six new filing fees
would be established. The new and
adjusted fees are generally designed to
recover more of the costs of TTAB
procedures, to reduce the extent to
which they are subsidized by trademark
fee collections, and to advance policy
objectives. The USPTO also proposes to
revise § 2.114(a) to provide that a partial
refund of the filing fee for a petition to
cancel may be made in cases involving
only a nonuse or abandonment claim,
when default judgment is entered in the
case, where there was no appearance by
a defendant, and where no filings were
made other than the petition to cancel.
Rulemaking goals and strategies:
Consistent with federal fee setting
standards, the Office conducted a
biennial review of fees, costs, and
revenues that began in 2019 and found
that fee adjustments are necessary to
provide the resources needed to
improve trademark operations and to
implement the USPTO 2018–2022
Strategic Plan (Strategic Plan). As a
result, the proposed fee adjustments
outlined in this proposed rule directly
align with the Office’s strategic goals
and key objectives as outlined in this
section. Consistent with the USPTO’s
strategic goals and obligations under the
AIA, the overall objective of this
rulemaking is to ensure the fee schedule
generates sufficient revenue to recover
the prospective aggregate costs of
trademark and TTAB strategic
improvements and operations,
including the associated administrative
costs. Fees must be set at levels
projected to cover the cost of future
budgetary requirements and maintain an
operating reserve at a sufficient level.
Trademark applications in FY 2019
represented filings in a record number
of over 673,000 classes of goods/
services. However, in the last two
recessions, new application filings
declined (2001, by ¥21.0%; 2002, by
¥12.7%; and 2009, by ¥12.3%),
demonstrating the sensitivity of
trademark filings, and therefore total
revenues, to general economic
conditions. So far, the current economic
downturn has produced similar
estimates of trademark application filing
declines. However, during ordinary
economic times, application filings
generally have increased by an average
historical rate of between 7% and 8%
per year. USPTO anticipates a return to
this historical trend as trademark
applicants return to expected activities.
To ensure its ability to keep pace with
demand, the USPTO is in the midst of
a multi-year IT systems and
infrastructure upgrade, which is critical
to the future of the U.S. trademark
registration system and represents a
significant cost to the Office.
The current fee schedule is
insufficient to meet future budgetary
requirements to: (1) Meet the expenses
that will result from projected filings
based on expectations for fee revenues;
(2) recover the costs necessary to
support trademark and TTAB operations
and administrative services; (3) make
necessary investments in IT systems,
intellectual property (IP) policy, and
USPTO programs related to trademark
and TTAB operations; and (4) achieve
optimal operating reserve levels to
ensure financial sustainability.
Budgetary requirements have increased
by 22% from FY 2019 to FY 2020 to
address unplanned pay raises,
additional review for potential fraud,
post-registration audits, agency
administrative operations, and
continued investments in IT that require
additional funding beginning in FY
2020. Without the proposed fee
adjustments, based on the assumptions
found in the FY 2021 Congressional
Justification, budgetary requirements
would exceed revenues and available
operating reserve balances beginning in
FY 2022 through FY 2025 (see Table 1).
TABLE 1—TRADEMARK FINANCIAL OUTLOOK WITHOUT PROPOSED FEES—FY 2021–FY 2025
Dollars in millions
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FY 2021
Projected Fee Collections ....................................................
Other Income .......................................................................
Total Projected Fee Collections and Other Income ............
Budgetary Requirements .....................................................
Funding to (+) and from (¥) Operating Reserve ................
EOY Operating Reserve Balance ........................................
Over/(Under) $75M Minimum Level ....................................
Over/(Under) Optimal Level .................................................
Table 2 below shows the available
revenue and operating reserve balances
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FY 2022
$367
6
373
419
¥46
26
(49)
(184)
$390
6
396
460
¥64
(38)
(113)
(268)
by fiscal year, including the proposed
fee rates in the projected fee collections.
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FY 2023
$412
6
418
462
¥44
(81)
(156)
(312)
FY 2024
$430
6
436
478
¥42
(123)
(198)
(362)
FY 2025
$447
6
453
497
¥44
(167)
(242)
(415)
The numbers in the table below can be
found in the FY 2021 Congressional
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Justification and were developed in late
calendar year 2019, prior to the COVID–
19 outbreak. Under current
circumstances, it is difficult to predict
what the actual numbers will be.
However, since USPTO was projecting
insufficient funding even during an
economic expansion (see Table 1) and
the trademark financial outlook has only
worsened since the onset of the
pandemic, USPTO still believes that a
fee increase will be necessary to put the
Office on a sustainable financial path.
TABLE 2—TRADEMARK FINANCIAL OUTLOOK INCLUDING PROPOSED FEES—FY 2021–FY 2025
Dollars in millions
FY 2021
Projected Fee Collections ....................................................
Other Income .......................................................................
Total Projected Fee Collections and Other Income ............
Budgetary Requirements .....................................................
Funding to (+) and from (¥) Operating Reserve ................
EOY Operating Reserve Balance ........................................
Over/(Under) $75M Minimum Level ....................................
Over/(Under) Optimal Level .................................................
Additional information on estimated
costs can be found in the USPTO FY
2021 Congressional Justification at
https://www.uspto.gov/about-us/
performance-and-planning/budget-andfinancial-information, which includes
two revenue estimates, one based on the
current fee schedule and another based
on this proposed rule (see Appendix IV:
USPTO Fees—Change from FY 2020 PB
to FY 2021 PB).
The USPTO, as a fully fee-funded
agency, retains an operating reserve to
ensure sufficient financial resources are
available to support and promote public
confidence in the U.S. IP system. The
operating reserve enables the USPTO to
maintain operations by absorbing and
responding to immediate and temporary
changes in its economic and operating
environments or circumstances, such as
unexpected economic downturns,
reducing the risk for short-term
financial actions and providing the
security for long-term strategic
investments, such as IT development
projects that are crucial to operations
FY 2022
$445
6
451
419
31
103
28
(107)
FY 2023
$472
6
478
460
18
121
46
(109)
and customer support. An adequate
operating reserve also allows the
USPTO to continue serving its users in
the event of a short-term lapse in
congressional appropriations or a
sudden economic downturn. Trademark
filings exhibit a strong connection to
domestic and global economic activity,
responding quickly to economic shocks,
as experienced in the 2001–2002 and
2009 recessions and most recently in
2020. The operating reserve is the
primary tool to mitigate the sudden
impact of these unforeseen events.
Another fee setting goal of this
rulemaking is to set individual fees to
further key IP protection policy
objectives while taking into account the
cost of a particular service. The USPTO
seeks to enhance trademark protection
for IP rights holders by offering
application-processing options and
promoting IP protection strategies.
Aligning fees with costs: The first fee
setting policy consideration is to set and
adjust trademark fees to more closely
align those fees with the costs of
FY 2024
$498
6
504
462
42
163
88
(68)
FY 2025
$519
6
525
478
47
211
136
(28)
$539
6
545
497
48
259
184
10
providing the relevant services. The
overall goal is to achieve total cost
recovery from fee collections for
trademark and TTAB operations,
including associated administrative
services. In determining which fees to
set or adjust, this proposed rule targets
changes to the category of fees where
the gap between the cost of the service
and the current fee rate is the greatest,
and addresses policy objectives.
Application filing fees, petition fees,
and TTAB fees do not fully cover the
costs of processing and examination for
those services. Instead, these costs are
recovered or subsidized from fees paid
for intent-to-use and post-registration
maintenance filings that return more
than the costs of processing such filings.
For example, using FY 2019 earned
revenue compared to costs or expenses,
application filing fees recovered 65% of
expenses, petition (trademark
processing) fees recovered 50% of
expenses, and TTAB fees recovered just
31% of expenses (see Table 3).
TABLE 3—EARNED REVENUE VS. EXPENSE BY TRADEMARK PRODUCT
FY 2019
earned revenue
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Trademark products
FY 2019
expense
FY 2019
variance
Earned revenue
vs. expense or
cost recovery
(%)
Application Filings ............................................................................
Intent to Use/Use Fees ....................................................................
Trademark Processing Fees ...........................................................
Maintaining Exclusive Rights ...........................................................
Madrid Protocol ................................................................................
Other Trademark Fees ....................................................................
Trademark Trial and Appeal Board .................................................
$190,457,284
49,885,175
2,619,600
79,942,987
4,294,675
10,571,283
8,452,900
$291,678,207
17,154,805
5,212,800
13,991,853
1,006,834
8,902,431
27,633,083
($101,220,923)
32,730,370
(2,593,200)
65,951,134
3,287,841
1,668,852
(19,180,183)
65
291
50
571
427
119
31
Total ..........................................................................................
346,223,905
365,580,013
(19,356,109)
............................
The proposed fee schedule would
increase the percentage of fee revenues
for application filings by 21%, for
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petition filings by 101%, and for TTAB
filings by 58% overall, thereby
increasing the cost recovery for these
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services (see Table 4). If the proposed
fee schedule were implemented, based
on the assumptions found in the FY
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2021 Congressional Justification, the
USPTO projects that trademark fee
collections in total would increase by an
average of 21% per year, or $77 million,
to $92 million per year over the five-
year planning period as compared to the
baseline (see Table 5).
TABLE 4—INCREASE IN CUMULATIVE REVENUE, BY PRODUCT
Projected cumulative revenue, FY
2021–2025
Trademark products
Current fee rates
(baseline)
Increase
(%)
NPRM fee rates
Application Filings ............................................................................................................
Maintaining Exclusive Rights ...........................................................................................
Intent to Use/Use .............................................................................................................
Madrid ..............................................................................................................................
TTAB ................................................................................................................................
Petition .............................................................................................................................
Other Processing Fees ....................................................................................................
$1,078,986,925
517,806,550
292,887,325
29,201,550
52,602,400
17,508,400
58,391,905
$1,300,666,600
659,008,548
292,887,325
42,258,078
83,164,508
35,147,450
58,391,905
21
27
0
45
58
101
0
Total ..........................................................................................................................
2,047,385,055
2,471,524,413
21
TABLE 5—ANNUAL INCREASES IN AGGREGATE REVENUE
FY 2021
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Aggregate Revenue—Baseline ................
Aggregate Revenue—NPRM ...................
$ Increase ................................................
% Increase ...............................................
$367,001,856
$443,946,233
$76,944,377
21.0%
Estimated revenues are based on
adjustments made from public
comments included in this rulemaking.
Protecting the integrity of the
trademark register: The second fee
setting policy consideration is to set or
adjust fees to improve the accuracy of
the trademark register. The accuracy of
the trademark register as a reflection of
marks that are actually in use in
commerce in the U.S. for the goods/
services identified in the registrations
listed therein serves a critical purpose
for the public and for all registrants. An
accurate register allows the public to
rely on the register to determine
potential trademark rights. By
registering trademarks, the USPTO has a
significant role in protecting consumers,
as well as providing important benefits
to American businesses, by allowing
them to strengthen and safeguard their
brands and related investments. The
public relies on the register to determine
whether a chosen mark is available for
use or registration. When a person’s
search of the register discloses a
potentially confusingly similar mark,
that person may incur a variety of
resulting costs and burdens, such as
those associated with investigating the
actual use of the disclosed mark to
assess any conflict, initiating
proceedings to cancel the registration or
oppose the application of the disclosed
mark, engaging in civil litigation to
resolve a dispute over the mark, or
changing business plans to avoid the
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FY 2022
FY 2023
$390,327,171
$471,660,715
$81,333,544
20.8%
$412,360,921
$497,754,151
$85,393,230
20.7%
use of that person’s chosen mark. In
addition, such persons may incur costs
and burdens unnecessarily if a
registered mark is not actually in use in
commerce in the U.S. or is not in use
in commerce in connection with all the
goods/services identified in the
registration. An accurate and reliable
trademark register helps avoid such
needless costs and burdens.
This proposed rule sets and adjusts
fees to encourage actions by trademark
filers that help facilitate more efficient
processing and the prompt conclusion
of application prosecution by assessing
fees for requests for reconsideration
filed more than three months after a
final Office action and for second and
subsequent extension requests to file
appeal briefs. In addition, filings that
may result in a less accurate register,
including post-registration filings to
maintain registrations that may include
goods or services for which the mark is
no longer in use, are among those filings
targeted under this objective. The new
fee structure for requests for
reconsideration and requests to delete
goods, services, and/or classes from a
registration would protect the integrity
of the register and the efficiency of the
process by incentivizing both more
timely filings and proactive action by
applicants and registrants. The
increased efficiencies realized through
the proposed rule will benefit all
applicants and registrants by allowing
registrations to be granted sooner and
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FY 2024
$430,391,196
$519,026,516
$88,635,320
20.6%
FY 2025
$447,303,911
$539,136,798
$91,832,887
20.5%
Average
$409,477,011
$494,304,883
$84,827,872
20.7%
more efficiently by removing unused
marks and unsupported goods and
services from the register.
Improving the efficiency of USPTO
processes: The third fee setting policy
consideration pertains to improving the
efficiency of the trademark and TTAB
processes. To that end, this proposed
rule targets changes to fees that will
administratively improve application
and appeal processing by incentivizing
more complete and timely filings and
prosecution. For example, TEAS Plus,
the lowest-cost TEAS application filing
option, has more stringent initial
application requirements and thus tends
to result in a more complete application,
which expedites processing, shortens
pendency, minimizes manual
processing and the potential for dataentry errors, and is thus more efficient
for both the filer and the USPTO. While
the per-class fee for TEAS Plus would
increase by $25 to $250 under this
proposal, the per-class fee for TEAS
Standard, which has less stringent
initial application requirements, is
proposed to increase by $75 to $350,
resulting in a difference of $100 in the
per-class fees of the respective filing
options (double the current difference of
$50), providing an increased financial
incentive to choose the TEAS Plus filing
option.
Ensuring financial sustainability to
facilitate effective trademark operations:
The fourth fee setting policy
consideration pertains to ensuring
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sufficient revenue to recover the
aggregate costs of trademark operations
in future years. Additional fees are
necessary to fund the multi-year project
to upgrade IT systems and
infrastructure, while also maintaining a
sufficient operating reserve balance to
ensure sustainable funding that will
mitigate the risk of unplanned financial
disruptions that could threaten
operations and planned investments.
Operating reserves are intended to
mitigate operational risk caused by a
lack of financial resources. The USPTO
defines an optimal balance and a
minimum acceptable balance for each
operating reserve—the patent operating
reserve and the trademark operating
reserve. The optimal balances set the
goal for building and maintaining the
operating reserves. The optimal
trademark reserve has been determined
to be six months of operating or
budgetary requirements based on a
review of environmental risk factors and
financial volatility. Risks related to
spending and fee collections are
analyzed, considering the likelihood
and consequence of each and its impact
to financial stability, in determining the
optimal reserve levels.
An increase in fees will provide a
stable financial foundation to fulfill the
USPTO mission and maintain
performance. The budgetary
requirements of the USPTO are
comprised of substantial fixed costs,
which may require increased fee rates to
ensure revenue sufficient to recover
aggregate costs. The trademark fee
schedule proposed here, based on the
assumptions found in the FY 2021
Congressional Justification, will
produce sufficient revenue to recover
the aggregate costs of trademark and
TTAB operations, including executing
USPTO strategic goals, policy
objectives, and initiatives in FY 2020
and beyond; creating a better and fairer
cost-recovery system that balances
subsidizing costs to encourage broader
usage of IP rights-protection
mechanisms and participation by more
trademark owners; promoting a strong
incentive for more efficient filing
behaviors; and protecting the federal
trademark register as a reliable indicator
of marks in use in commerce. The
projections of aggregate revenues and
costs are based on point-in-time
estimates and assumptions that are
subject to change. There is considerable
uncertainty in estimating both fee
collections and budgetary requirements
in ordinary times, and even more so
now. In addition to the pandemic, a
number of other risks could materialize
(e.g., even lower applications volumes,
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decreased renewals, the recompetitions
of major contracts, lease renewals,
changing assumptions about
Presidentially authorized or
congressionally mandated employee pay
raises, etc.) that could change the
USPTO’s budgetary outlook. These
estimates are refreshed annually in the
formulation of the USPTO’s Budget, and
the USPTO continues to gain new data
as the pandemic unfolds. As noted
above, in addition to these dynamics
factors, the budgetary requirements of
the USPTO are comprised of substantial
fixed costs, which could also influence
increased fee rates to ensure aggregate
revenue recovers aggregate costs.
Individual fee rationale: Based on the
assumptions found in the FY 2021
Congressional Justification, the USPTO
projects the aggregate revenue generated
from current and proposed trademark
fees will recover the prospective
aggregate costs of its trademark and
TTAB operations and associated
administrative services. However, each
individual proposed fee is not set at an
amount equal to the estimated cost of
performing the activities related to the
fee. Instead, as described above, some of
the proposed fees are set to address
increases in budgetary requirements as
well as balance several key policy
factors, and executing these policy
factors through the trademark fee
schedule is consistent with the goals
and objectives outlined in the Strategic
Plan. Once the cost recovery and key
policy objectives are considered, fees
are set at, above, or below individual
cost-recovery levels for the service
provided. Additional details on the cost
methodologies used to derive the
historical fee unit expenses can be
found in ‘‘USPTO Fee Setting—Activity
Based Information and Trademark Fee
Unit Expense Methodology’’ at https://
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
Trademark application filing fees:
This proposed rule would increase all
application filing fees by varying
amounts. The filing fee for a paper
trademark application would increase
by $150, from $600 per class to $750 per
class. The TEAS Plus application filing
fee would increase by $25, from $225
per class to $250 per class. The TEAS
Standard application filing fee would
increase by $75, from $275 per class to
$350 per class. The fee for filing an
application under section 66(a) of the
Act would increase by $100, from the
equivalent of $400 per class, as paid in
Swiss francs, to the equivalent of $500
per class, as paid in Swiss francs.
Also proposed is a decrease of the
processing fee from $125 to $100 per
class for failure to meet the filing
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37045
requirements under § 2.22(a) for a TEAS
Plus application. Thus, if the processing
fee is required in a TEAS Plus
application, the resulting per-class fee
would equal the per-class fee for a TEAS
Standard application. If a decrease in
the processing fee were not enacted, the
per-class fee for an application initially
filed as TEAS Plus would exceed the fee
for TEAS Standard, creating a
disincentive to choose TEAS Plus,
which, as noted above, tends to be more
efficient for both filers and the USPTO.
Fees for paper trademark filings: This
proposed rule maintains the cost
differential for all paper filings to better
align fees with costs, with all trademark
processing fees for paper filings set $100
to $200 higher than the corresponding
electronic filing fees (per class, when
applicable). Overall, it is more costly for
the USPTO to process paper filings than
electronic filings, and that cost is not
recovered by the current fees for paper
filings. Raising the fees for paper filings
will help offset the higher processing
costs and move the USPTO closer to
total cost recovery.
At present, most filings are submitted
electronically. For example, in FY 2019,
less than 0.02% of initial applications
were filed on paper. Moreover, a final
rule published on July 31, 2019 (84 FR
37081), which became effective on
February 15, 2020 (84 FR 69330),
requires all applicants, registrants, and
parties to TTAB proceedings to file
electronically through TEAS all
trademark applications based on section
1 and/or section 44 of the Act, 15 U.S.C.
1051, 1126, and all submissions filed
with the USPTO concerning
applications or registrations, with
limited exceptions. Thus, an increase to
paper filing fees would have no impact
on the vast majority of applicants and
registrants who are required to file
documents electronically.
Other trademark processing fees: The
USPTO also proposes to increase certain
other trademark processing fees to
further key policy goals. This proposed
rule sets out increases to the fees for
petitions to the Director as well as
section 8 and section 71 affidavits. In
addition, this proposed rule sets new
fees and procedural regulations for
filing a letter of protest and new fees for
filing a request for reconsideration more
than three months after a final Office
action, and for deleting goods, services,
and/or classes from a registration after
submission and prior to acceptance of a
section 8 or section 71 affidavit.
(1) Petitions to the Director in
trademark matters: The USPTO
proposes to establish two levels of fees
for petitions. This proposed rule would
increase the current fee for filing a
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petition to the Director for petitions
filed under §§ 2.146 or 2.147. It would
also establish a separate fee for petitions
to revive filed under § 2.66 that would
be less than the fee for petitions filed
under §§ 2.146 or 2.147. The proposed
fees are intended to facilitate effective
trademark operations. The fee for
electronically filing a petition to the
Director under §§ 2.146 or 2.147 would
increase from $100 to $250, and the fee
for filing on paper would increase from
$200 to $350. The fee for electronically
filing a petition to revive an abandoned
application under § 2.66 would increase
from $100 to $150, and the fee for filing
on paper would increase from $200 to
$250.
Generally, petitions under § 2.146
extend the trademark registration and
post-registration processes by
introducing additional processing and
examination into the timeline, which
may lead to applications and
registration maintenance documents
remaining pending for longer periods of
time, potentially blocking others. By
increasing fees for these filings, the
USPTO would discourage misuse of the
process through unnecessary filings that
delay prosecution of an application or
registration maintenance document. The
comments provided in the TPAC report
received by the USPTO also generally
supported the increases to the fees for
petitions to the Director under § 2.146
and a smaller increase for petitions
under § 2.66.
(2) Section 8 or section 71 affidavits:
Fees from post-registration filings have
historically been set to recover more
than the costs of processing the filings.
The fees are used to offset cost recovery
for application processing and
examination as well as TTAB
proceedings and appeals. In general,
fewer post-registration maintenance
filings are made by pro se and foreign
registrants. Compounding this issue, pro
se and foreign owners comprise a
growing share of new applicants. Based
on recent pre-pandemic trends, the
overall percentage of registrations being
maintained is decreasing. Therefore, the
USPTO anticipates that it will face a
continuing decrease in revenue from
maintenance filings going forward if
adjustments are not made. Increasing
fees for section 8 and section 71
affidavits is necessary to continue to
provide cost-recovery offsets and allow
other fees to remain below their
individual unit costs.
Increased fees are also proposed for
these filings in part because of the postregistration audit program, which was
implemented as a result of the 2012
Post-Registration Proof-of-Use Pilot
Program. During the pilot program,
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section 8 or section 71 affidavits for 500
registrations were reviewed as to actual
use of the marks in connection with the
goods and/or services identified in the
registrations in order to assess the
accuracy and integrity of the trademark
register. The findings of the pilot
program demonstrated a need for
ongoing measures for additional review
of these filings on a permanent basis.
Since codifying the authority to require
additional information and evidence
concerning the use of registered marks
in connection with section 8 and 71
maintenance filings in 2017 (82 FR
6259), the USPTO has conducted
additional reviews of the actual use of
the marks in 8,276 section 8 or section
71 affidavits through January 1, 2020. In
more than 50% of the registrations
undergoing the additional review, the
registrations have either been removed
from the register or had goods or
services deleted, resulting in a more
accurate trademark register. The
proposed fee increases would support
the cost of this additional review.
(3) Letters of protest in trademark
applications: The USPTO proposes a
new $50 fee for filing a letter of protest.
A letter of protest allows a third party
to bring to the attention of the USPTO
evidence bearing on the registrability of
a mark in a pending application. The
letter-of-protest procedure exists for the
administrative convenience of the Office
and is not a substitute for the statutory
opposition and cancellation procedures
available to third parties who believe
they would be damaged by registration
of the involved mark. It is intended to
aid in examination without causing
undue delay and without compromising
the integrity and objectivity of the ex
parte examination process, which
involves only the applicant and the
Office. For this reason, the protestor is
not permitted to submit legal arguments,
contact the examining attorney assigned
to the subject application, or participate
in any Office proceedings relating to the
protest or the application to which it is
directed. The limited involvement of the
third party ends with the filing of the
protest. The questions of whether or not
evidence is relevant to a refusal ground
appropriate in ex parte examination, a
refusal should be made, or a registration
will issue are matters for the Office to
determine during the ex parte
examination process that occurs
between the applicant and the Office
acting on behalf of the public.
Filing a letter of protest currently
requires no fee, but the Office incurs
costs associated with the work of
reviewing and processing each letter.
The filing volume for letters of protest
has steadily increased in recent years,
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with the USPTO receiving 2,726 in FY
2017, 3,480 in FY 2018, and 4,106 in FY
2019. Thus, letters of protest continue to
generate increasing additional expenses,
and under the current schedule where
letters can be filed without any fee,
these expenses would likely only
increase in the future.
Many preliminary commenters
expressed concerns about this proposed
fee, noting that letters of protest provide
a valuable service to the USPTO and
should not be discouraged by requiring
a fee for submission. The USPTO
recognizes that, in many cases, letters of
protest assist the Office in obtaining
evidence to support refusals of
registration, helping to avoid marks that
are ineligible for registration being
placed on the trademark register.
Currently, all letters of protest must be
reviewed in accordance with the
procedures set out in TMEP § 1715 to
determine whether: (1) The issue raised
is an appropriate subject for a letter of
protest; (2) the protest was submitted
before or after publication of the subject
application; (3) the nature, amount, and
format of the evidence complies with
the requirements set out in the TMEP;
and (4) the submitted evidence meets
the relevant standard for entry in the
record and review by the examining
attorney. If the letter of protest is filed
before publication of the subject
application, the evidence must be
relevant to the identified ground(s) for
refusal, and the entry of evidence into
the application record merely serves to
bring the submitted evidence to the
attention of the examining attorney,
who determines whether a refusal or
requirement should be raised or
ultimately made final. If the letter of
protest is filed on the date of, or within
30 days after, publication of the subject
application, the evidence must establish
a prima facie case for refusal on the
identified ground(s), such that failure to
issue a refusal would likely result in the
issuance of a registration in violation of
the Act or regulations under parts 2 or
7 of this section.
In FY 2019, the evidence in
approximately 25% of pre-publication
letters of protest and 94% of postpublication letters of protest was not
forwarded to the examining attorney.
This suggests that a significant portion
of filings do not contain relevant
information or evidence, or are
otherwise unnecessary. These filings
generate additional costs without a
corresponding benefit.
Seeking to balance the commenters’
concerns with the need to recover some
costs, the proposed fee of $50 is set at
a level high enough to partially offset
processing costs and deter the filing of
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unsupported or irrelevant filings, but
low enough so as not to discourage the
filing of relevant, well-supported letters
of protest. This fee level is also
consistent with the TPAC
recommendations in that it falls within
the $20 to $100 fee range suggested by
the TPAC report.
In connection with this proposed fee,
the USPTO also proposes a new
regulatory section, at 37 CFR 2.149,
which sets out the procedures for letters
of protest. The new regulatory section is
based on the existing longstanding
procedures for letters of protest, which
are currently set forth in the TMEP, with
appropriate modifications that more
closely align the procedures with those
for similar third-party submissions and
protests in patent applications under 37
CFR 1.290 and 1.291 and as set out in
MPEP §§ 1134 and 1901. This action is
being undertaken at this time due to the
rising volume of letters of protest in
recent years, which has resulted in the
need to codify procedures for
submission of such protests in the
regulations.
Under the procedures set forth in the
proposed regulatory text at § 2.149, a
letter of protest must be timely filed
through TEAS and must include: (1)
The proposed fee; (2) the serial number
of the pending application that is the
subject of the protest; (3) an itemized
evidence index that includes
identification of the documents, or
portions of documents, being submitted
as evidence and a concise factual
statement of the relevant grounds for
refusal of registration appropriate in ex
parte examination that each identified
item supports; and (4) a clear and
legible copy of the supporting evidence
identified in the evidence index. As
noted above, if the letter of protest is
filed before publication of the subject
application, the evidence must be
relevant to the identified ground(s) for
refusal. If filed on or within 30 days
after publication of the subject
application, the evidence must establish
a prima facie case for refusal on the
identified grounds, such that failure to
issue a refusal or make a requirement
would likely result in issuance of a
registration in violation of the Act or
regulations under parts 2 or 7 of this
section.
The letter-of-protest process is
intended to provide an opportunity for
the protestor to efficiently and
effectively provide relevant evidence in
support of the proposed legal grounds
for refusing registration of the
application identified in the
submission. It is inappropriate for the
protestor to ‘‘dump’’ evidence and leave
it to the Office to determine its possible
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relevance. Therefore, an index is
required for all submissions listing the
documents submitted as evidence and
the ground(s) for refusal each item of
evidence supports. In addition, the
proposed procedures also require that
the submission not total more than 10
items of evidence in support of a
specified ground of refusal and more
than 75 total pages of evidence without
a detailed and sufficient explanation
that establishes the special
circumstances that necessitate providing
more than 10 items of evidence per
refusal ground or more than 75 total
pages of evidence. This requirement
encourages the submission of evidence
that is succinct, not duplicative, and
limited to the most relevant evidence. It
should be a rare situation in which more
than 10 items of evidence or 75 total
pages of evidence is necessary to
support the proposed legal grounds for
refusal. However, some examples of
situations that might constitute such
special circumstances are when: (1) A
subject application includes multiple
classes and the protestor needs to
provide evidence of relatedness of the
goods/services for all classes in the
application; (2) evidence submitted to
support a refusal for descriptiveness
consists of fewer than 10 discrete items,
but each item comprises multiple pages,
totaling more than 75 pages; or (3) a
protestor raises more than one ground
for refusal and the evidence necessary to
support all grounds raised totals more
than 10 items or 75 pages.
A letter of protest submitted by a third
party is not made part of the application
record to preserve the ex parte nature of
examination. If the USPTO determines
that the submission complies with the
proposed regulations, only the specified
grounds for refusal and the provided
evidence relevant to the grounds for
refusal would be included in the
application record for consideration by
the examining attorney. A third party
filing a letter of protest will not receive
any communication from the USPTO
relating to the submission other than
acknowledgement that it has been
received by the Office and notification
of whether the submission is found to
be compliant or non-compliant. Also,
the Office will not accept amendments
to a non-compliant submission that was
previously filed or requests to
reconsider a compliance determination.
Rather, the third party may submit a
new letter of protest that is compliant if
the time period for submitting a letter of
protest has not closed. A protestor does
not, by the mere filing of a protest,
obtain a ‘‘right’’ to argue the protest
before the Office. As noted above, the
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37047
questions of whether or not evidence is
relevant to a refusal ground appropriate
in ex parte examination, a refusal will
be made, or a registration will issue are
matters for the Office to determine as
part of the ex parte examination process
that occurs between the applicant and
the Office acting on behalf of the public.
Therefore, the proposed procedures also
provide that: (1) The Office’s
determination whether to include
submitted evidence in the record of an
application would be final and nonpetitionable, (2) the limited involvement
of the third party ends with the filing of
the letter of protest, and (3) the third
party may not directly contact the
examining attorney assigned to the
application.
(4) Requests for reconsideration in
trademark applications: The USPTO
proposes a new fee for a request for
reconsideration filed more than three
months, but within six months, after the
issue date of a final action or with a
petition to revive an abandoned
application. The proposed fee is $400
for a TEAS submission and $500 for a
paper submission. No fee would be
incurred for requests filed within three
months of the issue date of a final
action.
As noted above, a request for
reconsideration is a document filed
within six months of the issue date of
a final action that responds to the
outstanding refusals or requirements. In
some cases, it may also be filed with a
petition to revive an application
abandoned for failure to respond to a
final action within the six-month
response period. In such cases, the
request for reconsideration would be
filed more than six months after the
issue date of the final action. It also
includes an applicant’s request to the
TTAB, filed within six months of the
issue date of a final action, whether
filed with or after a notice of appeal and
whether it is denominated as a request
for reconsideration or is captioned as
something else, such as a request for
remand (see TMEP § 709.05 and TBMP
§ 1209.04). In some cases, multiple
requests are filed. Examining attorneys
must review the request(s) for
reconsideration and take appropriate
action, which frequently involves
issuing a subsequent Office action that
discusses any new evidence submitted
with the request. In some
circumstances, Office procedure
requires the examining attorney to issue
a new refusal, with a new six-month
response deadline.
Because requests for reconsideration
require additional examination, they
generate additional costs for the USPTO.
In addition, requests for reconsideration
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lengthen the examination process,
thereby increasing overall examination
pendency, particularly when filed later
in the response period or after the filing
of a notice of appeal and prior to the
expiration of six months from the issue
date of the final action. The proposed
fee is intended to recover costs
associated with requests for
reconsideration and encourage
applicants to submit these filings earlier
in the response period for the final
action.
The TPAC report expressed concerns
that the proposed fee was too high and
could discourage the filing of requests
for reconsideration, which often resolve
issues and avoid the need for an appeal.
The TPAC report therefore suggested
that the Office consider not charging a
fee for requests filed within three
months of the final Office action. The
USPTO has considered and adopted the
suggestion from the TPAC report.
(5) Deletion of goods, services, and/or
classes from registrations: The USPTO
initially proposed fees for each good or
service deleted as a result of a postregistration audit or an adverse TTAB
finding of $200 if submitted on paper or
$100 if submitted through TEAS. The
TPAC report expressed concerns
regarding how the fees would be
assessed because it could be difficult to
determine what is a separate good or
service in some situations, and some
registrants with extensive goods and
services could potentially be assessed
onerous fees to delete specific goods or
services within a class. The TPAC report
supported a fee for the deletion of goods
or services as a result of a postregistration audit if the proposed fees
were charged per each class in which
goods or services are deleted. The report
also supported a no-fee option for
voluntarily cancelling goods or services
from a registration at any time prior to
an audit. The TPAC report did not
support the proposed new fees
following an adverse TTAB finding,
stating that it would be unclear when
the fee would apply and how it would
be implemented.
Currently, amendments to
registrations may be made by filing a
section 7 request for amendment or
correction of a registration for $100, if
submitted through TEAS, or $200, if
filed on paper. After consideration of
the TPAC response, the USPTO
proposes to set a $0 fee for a section 7
request that is filed through TEAS prior
to the submission of a section 8 or
section 71 affidavit and consists only of
a request to delete specified goods,
services, and/or classes. As noted above,
no additional fee would be incurred for
section 8 or section 71 affidavits that
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specify fewer than all of the goods or
services listed in the registration when
the affidavit is filed, which results in
the deletion of goods or services not
included in the affidavit from the
registration. However, if goods, services,
and/or classes are deleted in a section
7 request, a response to Office action, or
a voluntary amendment filed after
submission and prior to acceptance of a
section 8 or section 71 affidavit, the
USPTO proposes a new fee of $250 per
class, if filed through TEAS, or $350 per
class, if a paper filing is permitted, for
deleting goods, services, and/or classes
from the registration.
The proposed no-fee option would be
available to, and the $250 (or $350) perclass fee would be assessed against, all
registrants. Thus, they are not related to
a post-registration proof-of-use audit or
a TTAB finding. The proposals are
intended to improve the accuracy and
integrity of the register by encouraging
all registrants to proactively perform
sufficient due diligence before filing a
section 8 or section 71 affidavit to
determine the goods, services, and/or
classes for which the registered mark is
no longer in use and delete them from
the registration.
TTAB fees: The Office proposes to set
or adjust 16 TTAB-related fees: 10 fees
would be increased for initiating a
proceeding, and six new filing fees
would be established. The TTAB would
also obtain discretion to grant a refund
of a portion of the filing fee for a
petition to cancel.
(1) Existing fees at the TTAB: In an
attempt to address better alignment of
fees with the costs of providing TTAB
services, the initial fee proposal
presented to the TPAC included an
across-the-board increase in TTAB fees
for petitions for cancellation, notices of
opposition, and ex parte appeals of $200
per class. The TPAC report generally
supported an increase in filing fees for
petitions to cancel and notices of
opposition on the basis that the
proposed increases are justified on a
cost-recovery rationale, noting the high
average unit cost for these proceedings.
The TPAC report and some commenters
observed that many petitions to cancel
and notices of opposition are decided by
default judgment. Commenters objecting
to the preliminary proposed fee increase
for petitions to cancel expressed their
belief that the increase could deter
filings based on abandonment or
nonuse, which would impact the
USPTO’s objective of removing marks
from the trademark register that are no
longer being used.
In consideration of these observations,
the Office proposes an increase of $200
per class for petitions for cancellation
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and notices of opposition. The Office
also proposes to amend § 2.114(a) to
allow the USPTO discretion to refund a
portion of the petition fee in cases of
default judgment where there is no
appearance by a defendant and no
filings are made other than the petition
to cancel, reflecting reduced work
needed on the part of the TTAB;
consequently, this amount is in excess
of that required to offset TTAB costs.
The resulting lower net fee for a petition
to cancel that meets these characteristics
also furthers the policy goal of not
discouraging the filing of petitions to
cancel by petitioners with knowledge
that a registered mark is no longer in
use, or was never put to use, and
therefore should be removed from the
register. The refund would be in the
amount of $200. Compared to
cancellation proceedings, an opposition
is less likely to be determined by default
judgment based on abandonment or
nonuse, because the applicants involved
tend to be actively engaged with the
USPTO through the examination
process up to the opposition, and the
Office is not proposing to allow for
refunds concerning notices of
opposition.
The TPAC report expressed some
concern about the preliminary proposed
increase for filing a notice of ex parte
appeal, noting that, for various reasons,
many appeals are resolved before an
appeal brief is filed. Some commenters
expressed their belief that the proposed
increase would negatively impact small
businesses and individuals. In
consideration of the comments, the
Office herein proposes to increase the
filing fees for a notice of appeal to $325
per class if filed on paper and $225 per
class if filed through ESTTA, which is
a $25 increase (rather than the $200
increase to both fees in the preliminary
proposal).
Fee increases are proposed for filing
requests for an extension of time to file
an opposition. Under the current
structure, applicants may request: (1)
An initial 30-day extension for no fee,
(2) a subsequent 60-day extension for a
fee of $100 for electronic filings and
$200 for paper filings, and (3) a final 60day extension for a fee of $200 for
electronic filings and $300 for paper
filings. The Office proposes to maintain
this tiered structure with an increase of
$100 for the first 60-day electronic
extension and $200 for the final 60-day
electronic extension. Paper-filed
extension requests are proposed to
increase by $200 for each filing. The
current and proposed filing fees are per
application, not per class.
These proposed fees are designed to
yield efficiencies by encouraging
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potential opposers to make decisions
regarding filing an opposition sooner,
thus reducing delays to applicants
whose filings have been made the
subject of extensions of time to oppose.
Additionally, by encouraging earlier
decisions to initiate proceedings, the
uncertainty experienced by these
applicants will be ameliorated by
having their applications proceed to
determination on the merits sooner.
This should also help to protect the
integrity of the trademark register by
encouraging timely decisions and filings
to ensure that the rights of other
applicants and the public are not
adversely affected.
The TPAC report expressed some
concerns over the proposed increase in
these fees, noting that extension fees
were implemented about three years
prior and that raising them may result
in a higher number of oppositions being
filed because the decision is rushed.
Some commenters were concerned that
the proposed increases would impact
smaller entities and deter parties from
working to settle prior to filing a notice
of opposition. Given that the USPTO
also proposes increasing the fee for the
notice of opposition, the USPTO
believes that the proposed fees for
extensions of time to oppose should
encourage earlier calculated decisions
based on all of the available
information, including fees.
Furthermore, the tiered fee structure
reduces the likelihood of potential
opposers using the extensions merely to
delay registration of pending
applications.
Approximately two-thirds of the cost
of TTAB operations is subsidized
currently by revenue from other
trademark processing fees. The
proposed increases in these TTAB fees
will not recover the full costs of TTAB
operations but will increase revenues by
7% to bring fees closer to the costs in
order to provide better alignment
between costs and fees and bring the
TTAB closer to full cost recovery. In
general, the TPAC commenters
supported most of the proposed fee
increases with some modification
because of the recognized costs for
processing and the cost differential.
Finally, these fees will help offset
TTAB processing costs. In FY 2019, the
USPTO received 20,502 requests for
extensions of time to file a notice of
opposition. It is customary for requests
that delay processing of records, such as
extensions, to incur a fee, which offsets
costs associated with processing the
filing, as well as the overall cost of
processing appeals and trials. These fees
are necessary to help attain primary
Office goals of recovering the aggregate
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costs of operations, along with key
policy considerations, such as
encouraging efficient processing.
(2) Fees for filing an appeal brief at
the TTAB: The Office proposes an
increase in the fee for filing a notice of
appeal of $25 per class, based on
inflation, and the establishment of new
fees for filing an appeal brief of $300 per
class if filed on paper and $200 per class
if filed through ESTTA. In its initial
proposal submitted to the TPAC, the
Office had proposed raising the current
fees for filing a notice of appeal to the
TTAB by $200 per class and also
instituting new fees for filing briefs in
a notice of appeal. The TPAC supported
maintaining the current fees for filing a
notice of appeal and the proposed new
fees for filing an appeal brief. This
modification addresses the TPAC report
recommendations to apply the majority
of the aggregate increases in appeal fees
to the costs incurred when an appeal
brief is filed, which increases the
likelihood that the appeal will have to
be decided on the merits.
(3) Fees for filing requests for
extension of time to file an appeal brief
at the TTAB: New fees are proposed for
second and subsequent requests for
extensions of time to file an appeal
brief. The proposed fees are $200 per
application if filed on paper and $100
per application if filed through ESTTA.
No fee is proposed for a first request for
extension of time to file an appeal brief.
In its report on the initial proposal,
the TPAC expressed support for the
proposed new fees. Some commenters
objected to the proposed new fees,
expressing their belief that minimal
USPTO resources are required to
process such requests and that they
increase the overall costs to smaller
entities. These proposed fees yield
efficiencies by encouraging applicants
to move forward with their appeals,
resulting in a quicker resolution of the
appeal, the pendency of which can
adversely impact the rights of other
applicants and registrants.
Implementing a two-tiered fee structure
minimizes costs to smaller entities, as
there is no fee for a first request for
extension of time to file the appeal brief.
(4) Fees for oral hearing at the TTAB:
A new fee is proposed for a request for
an oral hearing. The proposed fee is
$500 per proceeding.
In its report on the initial proposal,
the TPAC expressed support for the
proposed new fee, noting that the TTAB
incurs significant costs in conducting
oral hearings and all users subsidize the
few parties requesting oral hearings.
Some commenters opposed the fee due
to the impact on small businesses and
individuals. Oral hearings are not
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37049
requested in the vast majority of cases
before the TTAB. They are optional and
are most useful when cases involve
complex issues, a complex record, or
highly technical goods and services. The
proposed fee would help offset the costs
of scheduling and conducting the
hearing, as well as the maintenance of
equipment for remote participation.
Discussion of Proposed Rule Changes
The USPTO proposes to revise
§ 2.6(a)(1)(i) to increase the per-class fee
for filing an initial application on paper
from $600 to $750.
The USPTO proposes to revise
§ 2.6(a)(1)(ii) to increase the per-class
fee for filing an application under
section 66(a) of the Act from $400 to
$500.
The USPTO proposes to revise
§ 2.6(a)(1)(iii) to increase the per-class
fee for filing a TEAS Standard
application from $275 to $350.
The USPTO proposes to revise
§ 2.6(a)(1)(iv) to increase the per-class
fee for filing a TEAS Plus application
from $225 to $250.
The USPTO proposes to revise
§ 2.6(a)(1)(v) to decrease the processing
fee under § 2.22(c) from $125 to $100
per class.
The USPTO proposes to add
§ 2.6(a)(11)(iii) to establish a fee of $0
for filing a section 7 request to amend
a registration through TEAS prior to
submission of a section 8 or section 71
affidavit and that consists only of the
deletion of goods, services, and/or
classes.
The USPTO proposes to revise
§ 2.6(a)(12)(i) and (ii) to increase the
per-class fee for filing a section 8
affidavit from $225 to $325 for a paper
submission and from $125 to $225 for
a TEAS submission.
The USPTO proposes to add
§ 2.6(a)(12)(iii) and (iv) to establish fees
for the deletion of goods, services, and/
or classes after submission and prior to
acceptance of a section 8 affidavit. The
proposed § 2.6(a)(12)(iii) and (iv) set the
per-class fee at $350 for a paper
submission and $250 for a TEAS
submission.
The USPTO proposes to revise
§ 2.6(a)(15) to establish separate fees for
petitions to the Director under §§ 2.146
or 2.147 and petitions to revive an
abandoned application under § 2.66.
The proposed revisions to § 2.6(a)(15)(i)
and (ii) set the fee for filing a petition
to the Director under §§ 2.146 or 2.147
at $350 for a paper submission and $250
for a TEAS submission. The proposed
addition of § 2.6(a)(15)(iii) and (iv) set
the fee for filing a petition to revive an
abandoned application under § 2.66 at
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$250 for a paper submission and $150
for a TEAS submission.
The USPTO proposes to revise
§ 2.6(a)(16)(i) and (ii) to increase the
per-class fee for filing a petition to
cancel from $500 to $700 for a paper
submission and from $400 to $600 for
an ESTTA submission.
The USPTO proposes to revise
§ 2.6(a)(17)(i) and (ii) to increase the
per-class fee for filing a notice of
opposition from $500 to $700 for a
paper submission and from $400 to
$600 for an ESTTA submission.
The USPTO proposes to revise
§ 2.6(a)(18) to increase the fee for filing
an ex parte appeal and to establish new
fees for requests for an extension of time
to file an appeal brief and for filing a
brief in an ex parte appeal. The
proposed revisions to § 2.6(a)(18)(i) and
(ii) increase the per-class fee for filing
an ex parte appeal from $300 to $325 for
a paper submission and from $200 to
$225 for an ESTTA submission. The
proposed addition of § 2.6(a)(18)(iii) sets
the per-application fee for filing a first
request for an extension of time to file
an appeal brief at $0. The proposed
addition of § 2.6(a)(18)(iv) and (v) sets
the per-application fee for filing a
second or subsequent request for an
extension of time to file an appeal brief
at $200 for a paper submission and $100
for an ESTTA submission. The proposed
addition of § 2.6(a)(18)(vi) and (vii) set
the per-class fee for filing a brief in an
ex parte appeal at $300 for a paper
submission and $200 for an ESTTA
submission.
The USPTO proposes to revise
§ 2.6(a)(22)(i) and (ii) to increase the fee
for filing a request for an extension of
time to file a notice of opposition
pursuant to § 2.102(c)(1)(ii) or (c)(2)
from $200 to $400 for a paper
submission and from $100 to $200 for
an ESTTA submission.
The USPTO proposes to revise
§ 2.6(a)(23)(i) and (ii) to increase the fee
for filing a request for an extension of
time to file a notice of opposition
pursuant to § 2.102(c)(3) from $300 to
$500 for a paper submission and from
$200 to $400 for an ESTTA submission.
The USPTO proposes to add
§ 2.6(a)(24) to establish a fee for filing a
request for an oral hearing before the
TTAB of $500 per proceeding.
The USPTO proposes to add
§ 2.6(a)(25) to establish a fee of $50 for
the filing of a letter of protest per subject
application.
The USPTO proposes to add
§ 2.6(a)(26) to set out fees for a request
for reconsideration filed more than three
months after a final action and within
six months of the issue date of a final
action or with a petition to revive an
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abandoned application. The USPTO
proposes to add § 2.6(a)(26)(i) to
establish a fee of $0 for filing a request
for reconsideration within three months
after the issue date of a final action
through TEAS. The USPTO proposes to
add § 2.6(a)(26)(ii) and (iii) to establish
a fee of $500 for a paper submission and
$400 for a TEAS or ESTTA submission
for a request for reconsideration filed
more than three months after and within
six months of the issue date of a final
Office action.
The USPTO proposes to revise
§ 2.114(a) to provide that a partial
refund of the fee for a petition to cancel,
equal to the increase in that fee
otherwise proposed by this rulemaking,
may be made in cases of default
judgment where there was no
appearance by a defendant and no
filings are made other than the petition
to cancel.
The USPTO proposes to add § 2.149,
which codifies the procedures and
requirements for letters of protest.
The USPTO proposes to revise the
section title and to restructure § 2.161 to
set out the requirements for section 8
affidavits or declarations more clearly.
The USPTO also proposes to add, at
revised § 2.161(c), a provision stating
that if goods, services, and/or classes are
deleted from a registration after
submission and prior to the acceptance
of a section 8 affidavit or declaration,
the deletion must be accompanied by
the relevant fee under proposed
§ 2.6(a)(12)(iii) or (iv) for each class from
which goods, services, and/or classes
are deleted.
The USPTO proposes to revise
§ 7.6(a)(6)(i) and (ii) to increase the perclass fee for filing a section 71 affidavit
from $225 to $325 for a paper
submission and from $125 to $225 for
a TEAS submission.
The USPTO proposes to add
§ 7.6(a)(6)(iii) and (iv) to establish fees
for the deletion of goods, services, and/
or classes after submission and prior to
acceptance of a section 71 affidavit. The
proposed § 7.6(a)(iii) and (iv) set the
per-class fee at $350 for a paper
submission and $250 for a TEAS
submission.
The USPTO proposes to revise the
section title and to restructure § 7.37 to
set out the requirements for section 71
affidavits or declarations more clearly.
The USPTO also proposes to add, at
revised § 7.37(c), a provision stating that
if goods, services, and/or classes are
deleted from a registration after
submission and prior to acceptance of a
section 71 affidavit or declaration, the
deletion must be accompanied by the
relevant fee under proposed
§ 7.6(a)(6)(iii) or (iv) for each class from
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which goods, services, and/or classes
are deleted.
Rulemaking Requirements
A. America Invents Act: This
rulemaking proposes to set and adjust
fees under section 10(a) of the AIA as
amended by the SUCCESS Act. Section
10(a) of the AIA authorizes the Director
to set or adjust by rule any trademark
fee established, authorized, or charged
under the Trademark Act for any
services performed by, or materials
furnished by, the USPTO (see section 10
of the AIA, Pub. L. 112–29, 125 Stat.
284, 316–17, as amended by Pub. L.
115–273, 132 Stat. 4158). Section 10(e)
of the AIA sets forth the general
requirements for rulemakings that set or
adjust fees under this authority. In
particular, section 10(e)(1) requires the
Director to publish in the Federal
Register any proposed fee change under
section 10 and include in such
publication the specific rationale and
purpose for the proposal, including the
possible expectations or benefits
resulting from the proposed change. For
such rulemakings, the AIA requires that
the USPTO provide a public comment
period of not less than 45 days.
The TPAC advises the Under
Secretary of Commerce for Intellectual
Property and Director of the USPTO on
the management, policies, goals,
performance, budget, and user fees of
trademark operations. When adopting
fees under section 10 of the AIA, the
AIA requires the Director to provide the
TPAC with the proposed fees at least 45
days prior to publishing them in the
Federal Register. The TPAC then has at
least 30 days within which to deliberate,
consider, and comment on the proposal,
as well as hold a public hearing(s) on
the proposed fees. The TPAC must make
a written report available to the public
of the comments, advice, and
recommendations of the committee
regarding the proposed fees before the
USPTO issues any final fees. The
USPTO will consider and analyze any
comments, advice, or recommendations
received from the TPAC before finally
setting or adjusting fees.
Consistent with the requirements of
the AIA, on August 28, 2019, the
Director notified the TPAC of the
USPTO’s intent to set or adjust
trademark fees and submitted a
preliminary trademark fee proposal with
supporting materials. The preliminary
trademark fee proposal and associated
materials are available at https://
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
The TPAC held a public hearing in
Alexandria, Virginia, on September 23,
2019. Transcripts of this hearing and
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comments submitted to the TPAC in
writing are available for review at https://
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
The TPAC subsequently issued a report,
dated October 31, 2019, regarding the
preliminary proposed fees. The report
can be found online at https://
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
B. Initial Regulatory Flexibility
Analysis: The USPTO publishes this
Initial Regulatory Flexibility Analysis
(IRFA) as required by the Regulatory
Flexibility Act (RFA) (5 U.S.C. 601 et
seq.) to examine the impact of the
USPTO’s proposed changes to
trademark fees on small entities and to
seek the public’s views. Under the RFA,
whenever an agency is required by 5
U.S.C. 553 (or any other law) to publish
an NPRM, the agency must prepare and
make available for public comment an
IRFA, unless the agency certifies under
5 U.S.C. 605(b) that the proposed rule,
if implemented, will not have a
significant economic impact on a
substantial number of small entities (see
5 U.S.C. 603, 605). This IRFA
incorporates the discussion of the
proposed changes in the preamble
above.
Items 1–5 below discuss the five items
specified in 5 U.S.C. 603(b)(1)–(5) to be
addressed in an IRFA. Item 5 below
discusses alternatives to this proposal
that the USPTO considered.
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1. Description of the Reasons That
Action by the USPTO Is Being
Considered
The USPTO proposes setting and
adjusting certain trademark fees as
authorized by section 10 of the AIA, as
amended by Public Law 115–273, 132
Stat. 4158 (the SUCCESS Act). The fee
schedule proposed under section 10 in
this rulemaking will, based on the
assumptions found in the FY 2021
Congressional Justification, recover the
aggregate estimated costs to the USPTO
while achieving strategic and
operational goals, such as implementing
measures to maintain trademark
pendency and high trademark quality,
modernizing the trademark IT systems,
continuing important programs for
stakeholder and public outreach,
enhancing operations of the TTAB, and
maintaining a sufficient operating
reserve. Aggregate costs are estimated
through the USPTO budget formulation
process with the annual preparation of
a five-year performance-based budget
request. Revenues are estimated based
on the projected demand (workload) for
trademark products and services and fee
rates.
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2. Succinct Statement of the Objectives
of, and Legal Basis for, the Proposed
Rule
The policy objectives of the proposed
rule are to: (1) Better align fees with
costs, (2) protect the integrity of the
trademark register, (3) improve the
efficiency of USPTO processes related to
trademark and TTAB operations, and (4)
ensure financial sustainability to
facilitate effective trademark operations.
The legal basis for the proposed rule is
section 10 of the AIA, as amended,
which provides the authority for the
Director to set or adjust by rule any fee
established, authorized, or charged
under the Trademark Act of 1946, 15
U.S.C. 1051 et seq., as amended. See
also section 31 of the Trademark Act, 15
U.S.C. 1113.
3. Description of and, Where Feasible,
Estimate of the Number of Affected
Small Entities
The USPTO does not collect or
maintain statistics in trademark cases on
small- versus large-entity applicants,
and this information would be required
in order to determine the number of
small entities that would be affected by
the proposed rule.
This proposed rule would apply to
any entity filing trademark documents
with the USPTO. The USPTO estimates,
based on the assumptions found in the
FY 2021 Congressional Justification,
that during the first full fiscal year
under the fees as proposed, the USPTO
would expect to collect approximately
$77 million more in trademark
processing and TTAB fees in FY 2021.
The USPTO would receive an additional
$40 million in fees from applications for
the registration of a mark, including
requests for extension of protection and
subsequent designations; $3 million
more from petitions, letters of protest,
and requests for reconsideration; and
$28 million more for section 8 and
section 71 affidavits. TTAB fees would
increase by $6 million.
Trademark fees are collected for
trademark-related services and products
at different points in time in the
trademark application examination
process and over the lifecycle of the
registration. Approximately 55% of all
trademark fee collections are from
application filing fees. Fees for TTAB
proceedings and appeals comprise 2.5%
of revenues. Fees from other trademark
activities, petitions, assignments and
certifications, and Madrid processing
are approximately 5% of revenues. Fees
for filing post-registration and intent-touse filings, which subsidize the costs of
filing, search, examination, and TTAB
activities, comprise 37.5%.
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The USPTO’s five-year estimated
aggregate trademark fee revenue is based
on the number of trademark
applications and other fee-related filings
it expects to receive for a given fiscal
year and work it expects to process in
a given fiscal year (an indicator of future
fee workload and budgetary
requirements). Within the iterative
process for estimating aggregate
revenue, the USPTO adjusts individual
fee rates up or down based on policy
and cost considerations and then
multiplies the resulting fee rates by
appropriate workload volumes to
calculate a revenue estimate for each
fee, which is then used to calculate the
aggregate revenue. Additional details
about the USPTO’s aggregate revenue,
including projected workloads by fee,
are available at https://www.uspto.gov/
about-us/performance-and-planning/
fee-setting-and-adjusting.
4. Description of the Reporting,
Recordkeeping, and Other Compliance
Requirements of the Proposed Rule,
Including an Estimate of the Classes of
Small Entities Which Will Be Subject to
the Requirement and the Type of
Professional Skills Necessary for
Preparation of the Report or Record
The proposed rule imposes no new
reporting or recordkeeping
requirements. The main purpose of the
proposed rule is to set and adjust
trademark fees. However, the rule
proposes new procedural regulations at
37 CFR 2.149 for the submission of
letters of protest. The USPTO does not
collect or maintain statistics in
trademark cases on small versus large
entity applicants and is unable to
provide an estimate of the classes of
small entities that will be subject to the
new procedural requirements.
5. Description of Any Significant
Alternatives to the Proposed Rule Which
Accomplish the Stated Objectives of
Applicable Statutes and Which
Minimize Any Significant Economic
Impact of the Rule on Small Entities
The USPTO considered four
alternatives, based on the assumptions
found in the FY 2021 Congressional
Justification, before recommending this
proposal: (1) The adjustments included
in this proposal, (2) an across-the-board
adjustment of 22%, (3) the unit cost of
providing services based on FY 2019
costs, and (4) no change to the baseline
of current fees. The alternatives are each
explained here with additional
information regarding how each
proposal was developed and the
aggregate revenue estimated. A
description of the Aggregate Revenue
Methodologies is available at https://
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Federal Register / Vol. 85, No. 119 / Friday, June 19, 2020 / Proposed Rules
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
The USPTO proposes to set or adjust
trademark fees codified in 37 CFR parts
2 and 7. Fees are adjusted for all
application filing types (i.e., paper
applications, applications filed via
TEAS, and requests for extension of
protection under section 66(a) of the
Trademark Act (15 U.S.C. 1141f)). The
USPTO also proposes to set or adjust
certain other trademark processing fees
to further effective administration of the
trademark system. For example, the
proposed rule increases the fees for
certain petitions to the Director as well
as section 8 and section 71 affidavits,
sets a new fee and proposes procedural
regulations for filing a letter of protest,
and sets new fees for filing a request for
reconsideration more than three months
after a final Office action and for
deleting goods, services, and/or classes
from a registration after submission and
prior to acceptance of a section 8 or
section 71 affidavit.
The USPTO chose the alternative
proposed in this rule because it will
enable the Office to achieve its goals
effectively and efficiently without
unduly burdening small entities,
erecting barriers to entry, or stifling
incentives to innovate. The alternative
proposed here secures the USPTO’s
objectives for meeting the strategic goals
of encouraging broader usage of IP
rights-protection mechanisms and
participation by more trademark owners
and more efficient resolution of appeals
and inter partes proceedings at the
TTAB by increasing revenue to meet the
Office’s aggregate future costs. In
particular, the new fee structure for
requests for reconsideration and
requests to delete goods, services, and/
or classes from a registration would
protect the integrity of the register and
the efficiency of the process by
incentivizing both more timely filings
and proactive action by applicants and
registrants. The increased efficiencies
realized through the proposed rule will
benefit all applicants and registrants by
allowing registrations to be granted
sooner and more efficiently by removing
unused marks and unsupported goods
and services from the register. All
trademark applicants should benefit
from the efficiency that will be realized
under the proposed alternative.
With regard to the new regulations
governing the filing of letters of protest,
the USPTO anticipates that the impact
to affected entities would be small. The
proposed fee of $50 is set at a level high
enough to recognize there are processing
costs and deter the filing of unsupported
or irrelevant filings, but low enough so
as not to discourage the filing of
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relevant, well-supported letters of
protest. In addition, the new procedural
regulations for filing letters of protest
are not anticipated to significantly
impact affected entities because the
proposed new regulations are based on
existing informal procedures set out in
the TMEP.
Finally, the proposed new provision
at § 2.114(a) provides that a partial
refund of the fee for a petition to cancel
may be made in cases of default
judgement where there was no
appearance by a defendant and no
filings were made other than the
petition to cancel. This change would
likely balance the cost recovery
obtained from the increase in the fee for
a petition to cancel, a case type that has
increased markedly in recent years,
against the benefit of having petitions to
cancel filed to remove registrations from
the register when petitioners have
determined through their investigations
that the registered marks are no longer
in use. In such situations, default
judgments often result, efficiently
clearing the register of marks that would
otherwise stand as potential bars to
applications seeking to register similar
marks. This reduces costs for applicants
filing such applications.
The proposed fee schedule for this
alternative (labeled ‘‘Alternative 1—
Proposed Alternative’’) is available in
the document entitled ‘‘Initial
Regulatory Flexibility Act Tables’’ at
https://www.uspto.gov/about-us/
performance-and-planning/fee-settingand-adjusting.
Another alternative to setting and
adjusting the proposed fees that was
considered was to increase all fees by
the same 22% across the board. This
alternative would maintain the status
quo structure of cost recovery, where
processing and examination costs are
subsidized by fees paid for intent-to-use
and post-registration maintenance
filings (both of which exceed the cost of
performing these services), given that all
fees would be adjusted by the same
escalation factor. This structure would
promote innovation strategies and allow
applicants to gain access to the
trademark system through fees set below
cost, while registrants pay maintenance
fees above cost to subsidize the belowcost front-end fees. This alternative was
ultimately rejected. Although this
alternative generates sufficient aggregate
revenue to recover aggregate operating
costs, unlike the proposed fee structure,
there would be no improvements in fee
schedule design. As such, this
alternative would not accomplish the
stated objective of enhancing the
integrity of the register by incentivizing
users to maintain accurate goods and
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services. Further, it would not enhance
the efficiency of the process, as it would
offer no new incentives for users to
timely file applications and other filings
or to resolve appeals and inter partes
proceedings at the TTAB more
expeditiously. The proposed fee
schedule for this alternative (labeled
‘‘Alternative 2—Across-the-Board
Adjustment’’) is available in the
document entitled ‘‘Initial Regulatory
Flexibility Act Tables’’ at https://
www.uspto.gov/about-us/performanceand-planning/fee-setting-and-adjusting.
A third alternative that was
considered was to set all trademark fees
to allow for the USPTO to recover 100%
of the unit costs associated with each
product or service provided, based on
the historical unit costs of the products
and services provided by the USPTO.
The USPTO uses activity based
information to determine the unit costs
of activities that contribute to the
services and processes provided by
individual fees. It is common practice in
the federal government to set a
particular fee at a level that recovers the
cost of a given good or service. In Office
of Management and Budget (OMB)
Circular A–25, User Charges, the OMB
states that user charges (fees) should be
sufficient to recover the full cost to the
federal government of providing the
particular service, resource, or good,
when the government is acting in its
capacity as sovereign. Under the unit
cost recovery alternative, fees are
generally set in line with the FY 2019
cost of providing the product or service.
This alternative would produce a
structure in which application and
processing fees would increase
significantly for all applicants and
intent-to-use and post-registration
maintenance filing fees would decrease
dramatically when compared with
current fees. In addition, these fees
would change from year to year with the
ebb and flow in the number of
applications submitted. This alternative
was rejected because it was determined
that the unit costs for any given product
or service can vary from year to year,
such that a yearly review of all, and an
adjustment to many, trademark fees
would be continually required and
could also lead to consumer confusion
regarding the amount at which any
given trademark fee was currently set
and what the relevant fee would be in
the future. Additionally, this alternative
does not address improvements in fee
design to accomplish the stated
objectives of encouraging broader usage
of IP rights-protection mechanisms and
participation by more trademark owners
as well as practices that improve the
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efficiency of the process. The USPTO
recognizes that this approach does not
account for changes in the fee structure
or inflationary factors that could likely
increase the costs of certain trademark
services and necessitate higher fees in
the out-years. However, the USPTO
contends that the FY 2019 data is the
best unit cost data available to inform
this analysis. The proposed fee schedule
for this alternative (labeled ‘‘Alternative
3—Unit Cost Recovery’’) is available in
the document entitled ‘‘Initial
Regulatory Flexibility Act Tables’’ at
https://www.uspto.gov/about-us/
performance-and-planning/fee-settingand-adjusting.
A final alternative to setting and
adjusting the proposed fees would be to
take no action at this time regarding
trademark fees and to leave all
trademark fees as currently set. This
alternative was rejected because, due to
changes in demand for certain services
and rising costs, the Office has
determined that a fee increase is needed
to meet future budgetary requirements
as described in the FY 2021 Budget. As
previously explained, the proposed fee
schedule will assist in promoting access
to the trademark system, protecting the
integrity of the register, and promoting
the efficiency of the trademark
registration process by incentivizing: (1)
Maintenance of registrations for goods
and services for which marks are
actually in use, (2) more timely filing of
applications and other documents, and
(3) faster resolution of appeals and inter
partes proceedings at the TTAB. The fee
schedule for this alternative (labeled
‘‘Alternative 4—Baseline—Current Fee
Schedule’’) is available in the document
entitled ‘‘Initial Regulatory Flexibility
Act Tables’’ at https://www.uspto.gov/
about-us/performance-and-planning/
fee-setting-and-adjusting.
6. Identification, to the Extent
Practicable, of All Relevant Federal
Rules Which May Duplicate, Overlap, or
Conflict With the Proposed Rule
The proposed rule would not
duplicate, overlap, or conflict with any
other federal rules.
C. Executive Order 12866 (Regulatory
Planning and Review): This rule has
been determined to be Significant for
purposes of Executive Order 12866
(Sept. 30, 1993).
D. Executive Order 13563 (Improving
Regulation and Regulatory Review): The
USPTO has complied with Executive
Order 13563 (Jan. 18, 2011).
Specifically, the USPTO has, to the
extent feasible and applicable: (1) Made
a reasoned determination that the
benefits justify the costs of the rule; (2)
tailored the rule to impose the least
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burden on society consistent with
obtaining the regulatory objectives; (3)
selected a regulatory approach that
maximizes net benefits; (4) specified
performance objectives; (5) identified
and assessed available alternatives; (6)
provided the public with a meaningful
opportunity to participate in the
regulatory process, including soliciting
the views of those likely affected prior
to issuing a notice of proposed
rulemaking, and provided online access
to the rulemaking docket; (7) attempted
to promote coordination, simplification,
and harmonization across government
agencies and identified goals designed
to promote innovation; (8) considered
approaches that reduce burdens and
maintain flexibility and freedom of
choice for the public; and (9) ensured
the objectivity of scientific and
technological information and
processes, to the extent applicable.
E. Executive Order 13771 (Reducing
Regulation and Controlling Regulatory
Costs): This proposed rule is not
expected to be subject to the
requirements of Executive Order 13771
(Jan. 30, 2017) because this proposed
rule is expected to involve a transfer
payment.
F. Executive Order 13132
(Federalism): This rule does not contain
policies with federalism implications
sufficient to warrant preparation of a
Federalism Assessment under Executive
Order 13132 (Aug. 4, 1999).
G. Executive Order 13175 (Tribal
Consultation): This rulemaking will not:
(1) Have substantial direct effects on one
or more Indian tribes; (2) impose
substantial direct compliance costs on
Indian tribal governments; or (3)
preempt tribal law. Therefore, a tribal
summary impact statement is not
required under Executive Order 13175
(Nov. 6, 2000).
H. Executive Order 13211 (Energy
Effects): This rulemaking is not a
significant energy action under
Executive Order 13211 because this
rulemaking is not likely to have a
significant adverse effect on the supply,
distribution, or use of energy. Therefore,
a Statement of Energy Effects is not
required under Executive Order 13211
(May 18, 2001).
I. Executive Order 12988 (Civil Justice
Reform): This rulemaking meets
applicable standards to minimize
litigation, eliminate ambiguity, and
reduce burden as set forth in sections
3(a) and 3(b)(2) of Executive Order
12988 (Feb. 5, 1996).
J. Executive Order 13045 (Protection
of Children): This rulemaking does not
concern an environmental risk to health
or safety that may disproportionately
PO 00000
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37053
affect children under Executive Order
13045 (Apr. 21, 1997).
K. Executive Order 12630 (Taking of
Private Property): This rulemaking will
not affect a taking of private property or
otherwise have taking implications
under Executive Order 12630 (Mar. 15,
1988).
L. Congressional Review Act: Under
the Congressional Review Act
provisions of the Small Business
Regulatory Enforcement Fairness Act of
1996 (5 U.S.C. 801 et seq.), prior to
issuing any final rule, the USPTO will
submit a report containing the final rule
and other required information to the
United States Senate, the United States
House of Representatives, and the
comptroller general of the Government
Accountability Office. The changes in
this rulemaking are not expected to
result in an annual effect on the
economy of $100 million or more, a
major increase in costs or prices, or
significant adverse effects on
competition, employment, investment,
productivity, innovation, or the ability
of United States-based enterprises to
compete with foreign-based enterprises
in domestic and export markets.
Therefore, this rulemaking is not
expected to result in a ‘‘major rule’’ as
defined in 5 U.S.C. 804(2).
M. Unfunded Mandates Reform Act of
1995: The changes set forth in this
rulemaking do not involve a Federal
intergovernmental mandate that will
result in the expenditure by State, local,
and tribal governments, in the aggregate,
of $100 million (as adjusted) or more in
any one year, or a Federal private sector
mandate that will result in the
expenditure by the private sector of
$100 million (as adjusted) or more in
any one year, and will not significantly
or uniquely affect small governments.
Therefore, no actions are necessary
under the provisions of the Unfunded
Mandates Reform Act of 1995. See 2
U.S.C. 1501 et seq.
N. National Environmental Policy
Act: This rulemaking will not have any
effect on the quality of the environment
and is thus categorically excluded from
review under the National
Environmental Policy Act of 1969. See
42 U.S.C. 4321 et seq.
O. National Technology Transfer and
Advancement Act: The requirements of
section 12(d) of the National
Technology Transfer and Advancement
Act of 1995 (15 U.S.C. 272 note) are not
applicable because this rulemaking does
not contain provisions that involve the
use of technical standards.
P. Paperwork Reduction Act: This rule
involves information collection
requirements that are subject to review
and approval by OMB under the
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Paperwork Reduction Act of 1995 (44
U.S.C. 3501 et seq.). The collections of
information involved with this
proposed rule have been reviewed and
previously approved by OMB under
OMB control numbers 0651–0009,
0651–0027, 0651–0028, 0651–0040,
0651–0050, 0651–0051, 0651–0054,
0651–0055, 0651–0056, and 0651–0061.
This action proposes to set or increase
OMB control No.
0651–0009
0651–0040
0651–0050
0651–0051
0651–0054
0651–0055
..........................
..........................
..........................
..........................
..........................
..........................
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Estimated
increase in cost
burdens (fees) due
to proposed rule
Information collection title
Applications for Trademark Registration ....................................................................................
Trademark Trial and Appeal Board (TTAB) Actions ..................................................................
Response to Office Action and Voluntary Amendment Forms ..................................................
Madrid Protocol ..........................................................................................................................
Substantive Submissions Made During Prosecution of the Trademark Application .................
Post Registration (Trademark Processing) ................................................................................
This estimated cost burden increase is
based on the currently OMB approved
response volumes associated with these
information collections, which may be
slightly different than the workflow
forecasts cited in other parts of this
proposed rule. In addition, any updates
to the aforementioned information
collections as a result of this proposed
rulemaking will be submitted to OMB
for approval prior to the effective date
of the final rule.
Comments regarding the collection of
information associated with this
proposed rule, including suggestions for
reducing the burden, may be sent to the
Commissioner for Trademarks, by mail
to P.O. Box 1451, Alexandria, VA
22313–1451, attention Catherine Cain;
by hand delivery to the Trademark
Assistance Center, Concourse Level,
James Madison Building-East Wing, 600
Dulany Street, Alexandria, Virginia
22314, attention Catherine Cain; or by
electronic mail message via the Federal
eRulemaking Portal (https://
www.regulations.gov). All comments
submitted directly to the USPTO or
provided on the Federal eRulemaking
Portal should include the docket
number (PTO–T–2019–0027).
Notwithstanding any other provision
of law, no person is required to respond
to nor shall a person be subject to a
penalty for failure to comply with a
collection of information subject to the
requirements of the Paperwork
Reduction Act unless that collection of
information has a currently valid OMB
control number.
List of Subjects
37 CFR Part 2
Administrative practice and
procedure, Courts, Lawyers,
Trademarks.
37 CFR Part 7
Administrative practice and
procedure, Trademarks.
VerDate Sep<11>2014
certain trademark fees, which would
increase the annual non-hour cost
burdens $42,483,850, as set out in the
following table:
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For the reasons stated in the preamble
and under the authority contained in
section 10(a) of the AIA, 15 U.S.C. 1113,
1123, and 35 U.S.C. 2, as amended, the
USPTO proposes to amend parts 2 and
7 of title 37 as follows:
PART 2—RULES OF PRACTICE IN
TRADEMARK CASES
1. The authority citation for part 2
continues to read as follows:
■
Authority: 15 U.S.C. 1113, 1123; 35 U.S.C.
2; sec. 10, Pub. L. 112–29, 125 Stat. 284,
unless otherwise noted. Sec. 2.99 also issued
under secs. 16, 17, 60 Stat. 434; 15 U.S.C.
1066, 1067.
2. Amend § 2.6 by:
a. Revising paragraphs (a)(1)(i)
through (v);
■ b. Adding paragraph (a)(11)(iii);
■ c. Revising paragraphs (a)(12), (15)
through (18), (22), and (23); and
■ d. Adding paragraphs (a)(24) through
(26).
The revisions and additions read as
follows:
■
■
§ 2.6
Trademark fees.
(a) * * *
(1) * * *
(i) For filing an application on paper,
per class—$750.00
(ii) For filing an application under
section 66(a) of the Act, per class—
$500.00
(iii) For filing a TEAS Standard
application, per class—$350.00
(iv) For filing a TEAS Plus application
under § 2.22, per class—$250.00
(v) Additional processing fee under
§ 2.22(c), per class—$100.00
*
*
*
*
*
(11) * * *.
(iii) For filing an amendment to a
registration prior to submission of an
affidavit under section 8 or section 71
of the Act and consisting only of the
deletion of goods, services, and/or
classes—$0.00
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$23,410,200
4,833,700
7,006,500
325,100
3,045,650
3,862,700
(12) Affidavit under section 8. (i) For
filing an affidavit under section 8 of the
Act on paper, per class—$325.00
(ii) For filing an affidavit under
section 8 of the Act through TEAS, per
class—$225.00
(iii) For deleting goods, services, and/
or classes after submission and prior to
acceptance of an affidavit under section
8 of the Act on paper, per class—
$350.00
(iv) For deleting goods, services, and/
or classes after submission and prior to
acceptance of an affidavit under section
8 of the Act through TEAS, per class—
$250.00
*
*
*
*
*
(15) Petitions to the Director. (i) For
filing a petition under § 2.146 or § 2.147
on paper—$350.00
(ii) For filing a petition under § 2.146
or § 2.147 through TEAS—$250.00
(iii) For filing a petition under § 2.66
on paper—$250.00
(iv) For filing a petition under § 2.66
through TEAS—$150.00
(16) Petition to cancel. (i) For filing a
petition to cancel on paper, per class—
$700.00
(ii) For filing a petition to cancel
through ESTTA, per class—$600.00
(17) Notice of opposition. (i) For filing
a notice of opposition on paper, per
class—$700.00
(ii) For filing a notice of opposition
through ESTTA, per class—$600.00
(18) Ex parte appeal. (i) For filing an
ex parte appeal to the Trademark Trial
and Appeal Board on paper, per class—
$325.00
(ii) For filing an ex parte appeal to the
Trademark Trial and Appeal Board
through ESTTA, per class—$225.00
(iii) For filing a first request for an
extension of time to file an appeal brief,
per application—$0.00
(iv) For filing a second or subsequent
request for an extension of time to file
an appeal brief on paper, per
application—$200.00
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(v) For filing a second or subsequent
request for an extension of time to file
an appeal brief through ESTTA, per
application—$100.00
(vi) For filing an appeal brief on
paper, per class—$300.00
(vii) For filing an appeal brief through
ESTTA, per class—$200.00
*
*
*
*
*
(22) Extension of time for filing a
notice of opposition under
§ 2.102(c)(1)(ii) or (c)(2). (i) For filing a
request for an extension of time to file
a notice of opposition under
§ 2.102(c)(1)(ii) or (c)(2) on paper—
$400.00
(ii) For filing a request for an
extension of time to file a notice of
opposition under § 2.102(c)(1)(ii) or
(c)(2) through ESTTA—$200.00
(23) Extension of time for filing a
notice of opposition under § 2.102(c)(3).
(i) For filing a request for an extension
of time to file a notice of opposition
under § 2.102(c)(3) on paper—$500.00
(ii) For filing a request for an
extension of time to file a notice of
opposition under § 2.102(c)(3) through
ESTTA—$400.00
(24) Oral hearing. For filing a request
for an oral hearing before the Trademark
Trial and Appeal Board, per
proceeding—$500.00
(25) Letter of protest. For filing a letter
of protest, per subject application—
$50.00
(26) Request for reconsideration. (i)
For filing a request for reconsideration
within three months after the issue date
of a final Office action through TEAS—
$0.00
(ii) For filing a request for
reconsideration more than three months
after and within six months of the issue
date of a final Office action, or with a
petition under § 2.66, on paper—
$500.00
(iii) For filing a request for
reconsideration more than three months
after and within six months of the issue
date of a final Office action, or with a
petition under § 2.66, through TEAS or
ESTTA—$400.00
*
*
*
*
*
■ 3. Amend § 2.114 by revising
paragraph (a) to read as follows:
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§ 2.114
Answer.
(a)(1) If no answer is filed within the
time initially set, or as later may be reset
by the Board, the petition may be
decided as in the case of default. The
failure to file a timely answer tolls all
deadlines, including the discovery
conference, until the issue of default is
resolved.
(2) If the cancellation proceeding is
based solely on abandonment or nonuse
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16:27 Jun 18, 2020
Jkt 250001
and default judgment is entered with no
appearance by the defendant, and no
filings are made other than the petition
to cancel, $200 of the petition to cancel
fee may be refunded.
*
*
*
*
*
■ 4. Add § 2.149 before the center
heading ‘‘Certificate’’ to read as follows:
§ 2.149 Letters of protest against pending
applications.
(a) A third party may submit, for
consideration and entry in the record of
a trademark application, objective
evidence relevant to the examination of
the application for a ground for refusal
of registration if the submission is made
in accordance with this section.
(b) A party protesting multiple
applications must file a separate
submission under this section for each
application.
(c) Any submission under this section
must be filed no later than 30 days after
the date the application is published for
opposition under section 12(a) of the
Act and § 2.80 of this part. If the subject
application cannot be withdrawn from
issuance of a registration while
consideration of the protest is pending,
the protest may be considered untimely.
(d)(1) If the letter of protest is filed
before publication of the subject
application, the evidence must be
relevant to the identified ground(s) for
refusal, such that it is appropriate for
the examining attorney to consider
whether to issue a refusal or make a
requirement under the Act or this part.
(2) If the letter of protest is filed on
or within 30 days after the date of
publication of the subject application,
the evidence must establish a prima
facie case for refusal on the identified
ground(s), such that failure to issue a
refusal or to make a requirement would
likely result in issuance of a registration
in violation of the Act or this part.
(e) Filing a submission under this
section does not stay or extend the time
for filing a notice of opposition.
(f) Any submission under this section
must be made in writing, filed through
TEAS, and include:
(1) The fee required by § 2.6(a)(25);
(2) The serial number of the pending
application that is the subject of the
protest;
(3) An itemized evidence index that
does not identify the protestor or its
representatives, does not contain legal
argument, and includes:
(i) An identification of the documents,
or portions of documents, being
submitted as evidence. The submission
may not total more than 10 items of
evidence in support of a specified
ground of refusal and more than 75 total
pages of evidence without a detailed
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37055
and sufficient explanation that
establishes the special circumstances
that necessitate providing more than 10
items of evidence per refusal ground or
more than 75 total pages of evidence;
and
(ii) A concise factual statement of the
relevant ground(s) for refusal of
registration appropriate in ex parte
examination that each item identified
supports; and
(4) A clear and legible copy of each
item identified in the evidence index
where:
(i) Copies of third-party registrations
come from the electronic records of the
Office and show the current status and
title of the registration;
(ii) Evidence from the internet
includes the date the evidence was
published or accessed and the complete
URL address of the website; and
(iii) Copies of printed publications
identify the publication name and date
of publication.
(g) Any submission under this section
may not be entered or considered by the
Office if:
(1) Any part of the submission is not
in compliance with this section;
(2) The application record shows that
the examining attorney already
considered the refusal ground(s)
specified in the submission; or
(3) A provision of the Act or parts 2
or 7 of this chapter precludes
acceptance of the submission.
(h) If a submission is determined to be
in compliance with this section, only
the specified ground(s) for refusal and
the provided evidence relevant to the
ground(s) for refusal will be included in
the application record for consideration
by the examining attorney. An applicant
need not and should not reply to the
entry into the application record of such
evidence in the absence of an Office
action issuing that includes such
evidence.
(i) Any determination whether to
include in an application record the
ground(s) or evidence for a refusal of
registration in a submission under this
section is not petitionable.
(j) A third party filing a submission
under this section will not receive any
communication from the Office relating
to the submission other than
acknowledgement that it has been
received by the Office and notification
of whether the submission is found to
be compliant or non-compliant with this
section. Communications with the third
party will not be made of record in the
application. The Office will not accept
amendments to a non-compliant
submission that was previously filed.
Instead, a third party who previously
filed a non-compliant submission may
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file another submission that meets the
requirements of paragraph (f) of this
section, provided the time period for
filing a submission in paragraph (c) of
this section has not closed.
(k) The limited involvement of the
third party ends with the filing of the
submission under this section. The third
party may not directly contact the
examining attorney assigned to the
application.
■ 5. Revise § 2.161 to read as follows:
khammond on DSKJM1Z7X2PROD with PROPOSALS
§ 2.161 Requirements for a complete
affidavit or declaration of use in commerce
or excusable nonuse; requirement for the
submission of additional information,
exhibits, affidavits or declarations, and
specimens; and fee for deletions of goods,
services, and/or classes from a registration.
(a) Requirements for a complete
affidavit or declaration. A complete
affidavit or declaration under section 8
of the Act must:
(1) Be filed by the owner within the
period set forth in § 2.160(a);
(2) Include a verified statement
attesting to the use in commerce or
excusable nonuse of the mark within the
period set forth in section 8 of the Act.
This verified statement must be
executed on or after the beginning of the
filing period specified in § 2.160(a);
(3) Include the U.S. registration
number;
(4)(i) Include the fee required by § 2.6
for each class that the affidavit or
declaration covers;
(ii) If the affidavit or declaration is
filed during the grace period under
section 8(a)(3) of the Act, include the
grace period surcharge per class
required by § 2.6;
(iii) If at least one fee is submitted for
a multiple-class registration, but the fee
is insufficient to cover all the classes,
and the class(es) to which the fee(s)
should be applied are not specified, the
Office will issue a notice requiring
either submission of the additional
fee(s) or specification of the class(es) to
which the initial fee(s) should be
applied. Additional fees may be
submitted if the requirements of § 2.164
are met. If the additional fee(s) are not
submitted within the time period set out
in the Office action and the class(es) to
which the original fee(s) should be
applied are not specified, the Office will
presume that the fee(s) cover the classes
in ascending order, beginning with the
lowest numbered class;
(5)(i) Specify the goods, services, or
nature of the collective membership
organization for which the mark is in
use in commerce, and/or the goods,
services, or nature of the collective
membership organization for which
excusable nonuse is claimed under
paragraph (a)(6)(ii) of this section; and
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(ii) Specify the goods, services, or
classes being deleted from the
registration, if the affidavit or
declaration covers fewer than all the
goods, services, or classes in the
registration;
(6)(i) State that the registered mark is
in use in commerce; or
(ii) If the registered mark is not in use
in commerce on or in connection with
all the goods, services, or classes
specified in the registration, set forth the
date when such use of the mark in
commerce stopped and the approximate
date when such use is expected to
resume; and recite facts to show that
nonuse as to those goods, services, or
classes is due to special circumstances
that excuse the nonuse and is not due
to an intention to abandon the mark;
and
(7) Include one specimen showing
how the mark is in use in commerce for
each class in the registration, unless
excusable nonuse is claimed under
paragraph (a)(6)(ii) of this section. When
requested by the Office, additional
specimens must be provided. The
specimen must meet the requirements of
§ 2.56.
(8) Additional requirements for a
collective mark: In addition to the above
requirements, a complete affidavit or
declaration pertaining to a collective
mark must:
(i) State that the owner is exercising
legitimate control over the use of the
mark in commerce; and
(ii) If the registration issued from an
application based solely on section 44 of
the Act, state the nature of the owner’s
control over the use of the mark by the
members in the first affidavit or
declaration filed under paragraph (a)(1)
of this section.
(9) Additional requirements for a
certification mark: In addition to the
above requirements, a complete affidavit
or declaration pertaining to a
certification mark must:
(i) Include a copy of the certification
standards specified in § 2.45(a)(4)(i)(B);
(A) Submitting certification standards
for the first time. If the registration
issued from an application based solely
on section 44 of the Act, include a copy
of the certification standards in the first
affidavit or declaration filed under
paragraph (a)(1) of this section; or
(B) Certification standards submitted
in prior filing. If the certification
standards in use at the time of filing the
affidavit or declaration have not
changed since the date they were
previously submitted to the Office,
include a statement to that effect; if the
certification standards in use at the time
of filing the affidavit or declaration have
changed since the date they were
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Frm 00026
Fmt 4702
Sfmt 4702
previously submitted to the Office,
include a copy of the revised
certification standards;
(ii) State that the owner is exercising
legitimate control over the use of the
mark in commerce; and
(iii) Satisfy the requirements of
§ 2.45(a)(4)(i)(A) and (C).
(10) For requirements of a complete
affidavit or declaration of use in
commerce or excusable nonuse for a
registration that issued from a section
66(a) basis application, see § 7.37.
(b) Requirement for the submission of
additional information, exhibits,
affidavits or declarations, and
specimens. The Office may require the
owner to furnish such information,
exhibits, affidavits or declarations, and
such additional specimens as may be
reasonably necessary to the proper
examination of the affidavit or
declaration under section 8 of the Act or
for the Office to assess and promote the
accuracy and integrity of the register.
(c) Fee for deletions of goods, services,
and/or classes from a registration.
Deletions by the owner of goods,
services, and/or classes from a
registration after submission and prior
to acceptance of the affidavit or
declaration must be accompanied by the
relevant fee in § 2.6(a)(12)(iii) or (iv).
PART 7—RULES OF PRACTICE IN
FILINGS PURSUANT TO THE
PROTOCOL RELATING TO THE
MADRID AGREEMENT CONCERNING
THE INTERNATIONAL REGISTRATION
OF MARKS
6. The authority citation for 37 CFR
part 7 continues to read as follows:
■
Authority: 15 U.S.C. 1123, 35 U.S.C. 2,
unless otherwise noted.
7. Amend § 7.6 by revising paragraph
(a)(6) read as follows:
■
§ 7.6
Schedule of U.S. process fees.
(a) * * *
(6) Affidavit under section 71. (i) For
filing an affidavit under section 71 of
the Act on paper, per class—$325.00
(ii) For filing an affidavit under
section 71 of the Act through TEAS, per
class—$225.00
(iii) For deleting goods, services, and/
or classes after submission and prior to
acceptance of an affidavit under section
71 of the Act on paper, per class—
$350.00
(iv) For deleting goods, services, and/
or classes after submission and prior to
acceptance of an affidavit under section
71 of the Act through TEAS, per class—
$250.00
*
*
*
*
*
■ 8. Revise § 7.37 to read as follows:
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§ 7.37 Requirements for a complete
affidavit or declaration of use in commerce
or excusable nonuse; requirement for the
submission of additional information,
exhibits, affidavits or declarations, and
specimens; and fee for deletions of goods,
services, and/or classes from a registration.
(a) Requirements for a complete
affidavit or declaration. A complete
affidavit or declaration under section 71
of the Act must:
(1) Be filed by the holder of the
international registration within the
period set forth in § 7.36(b);
(2) Include a verified statement
attesting to the use in commerce or
excusable nonuse of the mark within the
period set forth in section 71 of the Act.
The verified statement must be executed
on or after the beginning of the filing
period specified in § 7.36(b). A person
who is properly authorized to sign on
behalf of the holder is:
(i) A person with legal authority to
bind the holder;
(ii) A person with firsthand
knowledge of the facts and actual or
implied authority to act on behalf of the
holder; or
(iii) An attorney as defined in § 11.1
of this chapter who has an actual
written or verbal power of attorney or an
implied power of attorney from the
holder.
(3) Include the U.S. registration
number;
(4)(i) Include the fee required by § 7.6
for each class that the affidavit or
declaration covers;
(ii) If the affidavit or declaration is
filed during the grace period under
section 71(a)(3) of the Act, include the
grace period surcharge per class
required by § 7.6;
(iii) If at least one fee is submitted for
a multiple-class registration, but the fee
is insufficient to cover all the classes,
and the class(es) to which the fee(s)
should be applied are not specified, the
Office will issue a notice requiring
either submission of the additional
fee(s) or specification of the class(es) to
which the initial fee(s) should be
applied. Additional fees may be
submitted if the requirements of § 7.39
are met. If the additional fee(s) are not
submitted within the time period set out
in the Office action, and the class(es) to
which the original fee(s) should be
applied are not specified, the Office will
presume that the fee(s) cover the classes
in ascending order, beginning with the
lowest numbered class;
(5)(i) Specify the goods, services, or
nature of the collective membership
organization for which the mark is in
use in commerce, and/or the goods,
services, or nature of the collective
membership organization for which
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16:27 Jun 18, 2020
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excusable nonuse is claimed under
paragraph (a)(6)(ii) of this section; and
(ii) Specify the goods, services, or
classes being deleted from the
registration, if the affidavit or
declaration covers fewer than all the
goods, services, or classes in the
registration;
(6)(i) State that the registered mark is
in use in commerce; or
(ii) If the registered mark is not in use
in commerce on or in connection with
all the goods, services, or classes
specified in the registration, set forth the
date when such use of the mark in
commerce stopped and the approximate
date when such use is expected to
resume; and recite facts to show that
nonuse as to those goods, services, or
classes is due to special circumstances
that excuse the nonuse and is not due
to an intention to abandon the mark;
and
(7) Include one specimen showing
how the mark is in use in commerce for
each class in the registration, unless
excusable nonuse is claimed under
paragraph (a)(6)(ii) of this section. When
requested by the Office, additional
specimens must be provided. The
specimen must meet the requirements of
§ 2.56 of this chapter.
(8) Additional requirements for a
collective mark: In addition to the above
requirements, a complete affidavit or
declaration pertaining to a collective
mark must:
(i) State that the holder is exercising
legitimate control over the use of the
mark in commerce; and
(ii) State the nature of the holder’s
control over the use of the mark by the
members in the first affidavit or
declaration filed under paragraph (a)(1)
of this section.
(9) Additional requirements for a
certification mark: In addition to the
above requirements, a complete affidavit
or declaration pertaining to a
certification mark must:
(i) Include a copy of the certification
standards specified in § 2.45(a)(4)(i)(B)
of this chapter;
(A) Submitting certification standards
for the first time. In the first affidavit or
declaration filed under paragraph (a)(1)
of this section, include a copy of the
certification standards; or
(B) Certification standards submitted
in prior filing. If the certification
standards in use at the time of filing the
affidavit or declaration have not
changed since the date they were
previously submitted to the Office,
include a statement to that effect; if the
certification standards in use at the time
of filing the affidavit or declaration have
changed since the date they were
previously submitted to the Office,
PO 00000
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Fmt 4702
Sfmt 4702
37057
include a copy of the revised
certification standards;
(ii) State that the holder is exercising
legitimate control over the use of the
mark in commerce; and
(iii) Satisfy the requirements of
§ 2.45(a)(4)(i)(A) and (C) of this chapter.
(b) Requirement for the submission of
additional information, exhibits,
affidavits or declarations, and
specimens. The Office may require the
holder to furnish such information,
exhibits, affidavits or declarations, and
such additional specimens as may be
reasonably necessary to the proper
examination of the affidavit or
declaration under section 71 of the Act
or for the Office to assess and promote
the accuracy and integrity of the
register.
(c) Fee for deletions of goods, services,
and/or classes from a registration.
Deletions by the holder of goods,
services, and/or classes from a
registration after submission and prior
to acceptance of the affidavit or
declaration must be accompanied by the
relevant fee in § 7.6(a)(6)(iii) or (iv).
Dated: June 12, 2020.
Andrei Iancu,
Under Secretary of Commerce for Intellectual
Property and Director of the United States
Patent and Trademark Office.
[FR Doc. 2020–13262 Filed 6–18–20; 8:45 am]
BILLING CODE 3510–16–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR 83
[EPA–HQ–OAR–2020–00044; FRL 10011–
13–OAR]
RIN 2060–AU51
Increasing Consistency and
Transparency in Considering Benefits
and Costs in the Clean Air Act
Rulemaking Process; Extension of
Comment Period and Public Hearing
Environmental Protection
Agency (EPA).
ACTION: Notice of proposed rulemaking;
extension of comment period and
notification of public hearing.
AGENCY:
On June 11, 2020, the
Environmental Protection Agency (EPA)
published the proposed rulemaking
‘‘Increasing Consistency and
Transparency in Considering Benefits
and Costs in the Clean Air Act
Rulemaking Process.’’ The EPA is
extending the comment period on the
proposed rulemaking. The EPA is also
announcing that a virtual public hearing
SUMMARY:
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Agencies
[Federal Register Volume 85, Number 119 (Friday, June 19, 2020)]
[Proposed Rules]
[Pages 37040-37057]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-13262]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
Patent and Trademark Office
37 CFR Parts 2 and 7
[Docket No. PTO-T-2019-0027]
RIN 0651-AD42
Trademark Fee Adjustment
AGENCY: United States Patent and Trademark Office, Department of
Commerce.
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: The United States Patent and Trademark Office (Office or
USPTO) proposes to set or adjust certain trademark fees, as authorized
by the Leahy-Smith America Invents Act (AIA), as amended by the Study
of Underrepresented Classes Chasing Engineering and Science Success Act
of 2018 (SUCCESS Act). The proposed fees are intended to recover the
prospective aggregate costs of future strategic and operational
trademark and Trademark Trial and Appeal Board (TTAB or Board) goals
(based on workload projections included in the USPTO fiscal year (FY)
2021 Congressional Justification), including associated administrative
costs. The proposed fees will further USPTO strategic objectives by:
Better aligning fees with costs, protecting the integrity of the
trademark register, improving the efficiency of agency processes, and
ensuring financial sustainability to facilitate effective trademark
operations. Before a final rule is issued, the USPTO will consider the
state of the U.S. economy, the operational needs of the agency, and
public comments submitted pursuant to this rulemaking. The USPTO will
make adjustments as necessary to the substance and timing of any final
rule based on all of these considerations.
DATES: Written comments must be received on or before August 3, 2020.
ADDRESSES: The USPTO prefers that comments be submitted electronically
via email to [email protected]. Written comments may also be
submitted by mail to Commissioner for Trademarks, P.O. Box 1451,
Alexandria, VA 22313-1451, attention Catherine Cain; by hand delivery
to the Trademark Assistance Center, Concourse Level, James Madison
Building-East Wing, 600 Dulany Street, Alexandria, Virginia 22314,
attention Catherine Cain; or via the Federal eRulemaking Portal. See
the Federal eRulemaking Portal website (https://www.regulations.gov)
for additional instructions on providing comments via the portal. All
comments submitted directly to the USPTO or provided on the Federal
eRulemaking Portal should include the docket number (PTO-T-2019-0027).
Although comments may be submitted by postal mail, the USPTO
prefers to receive comments electronically because the Office may more
easily share such comments with the public. The USPTO prefers that
comments submitted electronically be in plain text, but they also may
be submitted in portable document format (PDF) or a word processing
file format (DOC or DOCX). Comments not submitted electronically should
be submitted on paper in a format that facilitates convenient digital
scanning into PDF.
The comments will be available for public inspection on the USPTO's
website at https://www.uspto.gov, on the Federal eRulemaking Portal, and
at the Office of the Commissioner for Trademarks, Madison East, Tenth
Floor, 600 Dulany Street, Alexandria, Virginia 22314. Because comments
will be made available for public inspection, information that is not
desired to be made public, such as an address or phone number, should
not be included.
FOR FURTHER INFORMATION CONTACT: Catherine Cain, Office of the Deputy
Commissioner for Trademark Examination Policy, at 571-272-8946, or by
email at [email protected].
SUPPLEMENTARY INFORMATION: The USPTO conducted a fee assessment in
January 2019 that formed the basis for this regulatory process to
propose adjusting and setting new trademark user fees. While trademark-
related costs of operations have risen, trademark fees have not changed
since January 2017. The revenue and workload assumptions in this notice
of proposed rulemaking (NPRM) are based on the assumptions found in the
FY 2021 Congressional Justification. However, projections of aggregate
revenues and costs are based on point-in-time estimates, and the
circumstances surrounding these assumptions can change quickly.
Notably, since the FY 2021 Congressional Justification was published,
fee collections have been lower than anticipated, in part due to lower
than expected application filings as a result of the COVID-19 outbreak.
The USPTO is also mindful of the current difficulties many USPTO
users are experiencing as a result of the pandemic. The USPTO has
undertaken many efforts to provide various types of relief, including
deadline extensions and fee postponements. Ultimately, the goal of the
USPTO is to ensure not only that businesses and entrepreneurs can
weather this storm, but that they can hit the ground running once it
passes.
The USPTO anticipates that the earliest any proposed trademark fee
changes could take effect is October 2020. Before a final rule is
issued, the USPTO will consider the state of the U.S. economy, the
operational needs of the agency, and public comments submitted pursuant
to this NPRM. The USPTO will make adjustments as necessary to the
substance and timing of any final rule based on all of these
considerations.
As part of the multi-year fee-setting process, the Trademark Public
Advisory Committee (TPAC) held a public hearing at the USPTO on
September 23, 2019. The Office considered and analyzed all comments,
advice, and recommendations received from the TPAC before publishing
this NPRM. The USPTO is now moving to the next step in the process.
This NPRM proposes changes to fees and also proposes new fees in order
to solicit public comment.
Purpose: The USPTO protects consumers and provides benefits to
businesses by effectively and efficiently carrying out the trademark
laws of the United States. As a fee funded agency, appropriate fees are
critically important for the USPTO to maintain the quality and
timeliness of examination and other services, and to stabilize and
modernize aging information technology (IT) infrastructure. The fee
schedule proposed in this rulemaking will recover the USPTO's aggregate
estimated future costs and ensure the USPTO can achieve strategic and
operational goals, such as effectively using resources to maintain low
trademark pendency and high quality, fostering business effectiveness
(ensuring quality results for employees and managers), stabilizing and
modernizing trademark IT systems, continuing programs for stakeholder
and public outreach, enhancing operations of the TTAB, and ensuring
financial sustainability to facilitate effective trademark operations.
Section 10 of the AIA authorizes the Director of the USPTO
(Director) to set or adjust by rule any fee established, authorized, or
charged under the Trademark Act of 1946, 15 U.S.C. 1051
[[Page 37041]]
et seq., as amended (the Trademark Act or the Act) for any services
performed by, or materials furnished by, the Office. See section 10 of
the AIA, Public Law 112-29, 125 Stat. 284, 316-17, as amended by the
SUCCESS Act, Public Law 115-273, 132 Stat. 4158. Section 10 of the AIA
prescribes that trademark fees may be set or adjusted only to recover
the aggregate estimated costs to the USPTO for processing, activities,
services, and materials relating to trademarks, including
administrative costs to the USPTO with respect to such trademark and
TTAB operations. However, this authority includes the flexibility to
set individual fees to advance key policy objectives. Thus, the
Director may set individual fees at, below, or above their respective
associated costs, while taking into account the aggregate estimated
costs to the USPTO.
Section 10 of the AIA also establishes certain procedural
requirements for setting or adjusting fee regulations, including public
hearings by, and input from, the TPAC. See section 10(c) of the AIA,
Public Law 112-29, 125 Stat. at 317. Accordingly, on August 28, 2019,
the Director notified the TPAC of the USPTO's intent to set or adjust
trademark fees and submitted a preliminary trademark fee proposal with
supporting materials, available at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
On September 23, 2019, the TPAC held a public hearing in
Alexandria, Virginia. Transcripts of this hearing and comments
submitted to the TPAC in writing are available for review at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
The TPAC subsequently released a report (TPAC report), dated
October 31, 2019, regarding the preliminary proposed fees. The report
recognized that fee adjustments are warranted to achieve strategic and
operational goals and evaluated the various proposed fees in view of
the USPTO's stated rationales for setting or adjusting fees for certain
services and activities, as well as the public comments regarding the
fee proposals. The TPAC report expressed support for an increase in
fees that would support USPTO operations by recovering costs and
maintaining a sufficient operating reserve but raised concerns
regarding some of the proposed fee increases and their potential impact
on customers. The TPAC report offered recommendations to address these
concerns. The report is available at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
After careful consideration of the comments and recommendations
provided in the TPAC report and in testimony by users at the public
hearing, and keeping in mind the fee setting goals of this proposed
rule, the USPTO has made various changes to the initial fee proposal,
including the withdrawal of proposed fees for filing a motion for
summary judgment and for filing a request for suspension and remand and
the proposed increase in the fee for filing an affidavit under section
15 of the Act. Other fees in the preliminary proposal were retained or
modified, as reflected in this proposed rule and explained in further
detail below. The USPTO seeks comments on the fee proposals, including
in relation to the current environment.
The USPTO estimates, based on the assumptions found in the FY 2021
Congressional Justification, that the additional aggregate revenue
derived from the proposed fee schedule will recover the future costs of
implementing strategic and operational goals, including the cost of
necessary IT stabilization and modernization activities, with the
expectation that the proposal will gradually build the operating
reserve to achieve sustainable funding that will mitigate the risk of
immediate unplanned financial disruptions. Under this proposal, based
on the assumptions found in the FY 2021 Congressional Justification,
the Office estimates reaching the optimal six-month trademark operating
reserve level in FY 2025.
Summary of major provisions: The USPTO proposes to set or adjust
trademark fees codified in 37 CFR parts 2 and 7. Fees are proposed to
be increased for all application filing types (i.e., paper
applications, applications filed via the Trademark Electronic
Application System (TEAS), and requests for extension of protection
under section 66(a) of the Trademark Act, 15 U.S.C. 1141f). The
proposed per-class fee increases range from $25 for a TEAS Plus
application to $150 for a paper application. Fee increases of $100 per
class are also proposed for filing affidavits or declarations of use or
excusable non-use under section 8 or section 71 of the Act (section 8
or section 71 affidavits), 15 U.S.C. 1058, 1141k. As described in
further detail below, these proposed increases address policy
considerations related to ensuring a more accurate register as well as
reflecting increased processing costs to the Office in handling these
filings.
This proposed rule creates two levels of fees for petitions, one
for petitions to the Director under Sec. Sec. 2.146 and 2.147 and a
lower fee for a petition to revive an abandoned application under Sec.
2.66. Currently, the fees for these petitions are $200 if filed on
paper and $100 if filed through TEAS. The USPTO proposes to set the fee
for petitions under Sec. Sec. 2.146 and 2.147 at $350 if filed on
paper and $250 if filed through TEAS. The fees for a petition to revive
under Sec. 2.66 are proposed to be set at $250 if filed on paper and
$150 if filed through TEAS. These proposed fees take into account the
different processing costs of these filings.
New fees are proposed for requests for reconsideration under Sec.
2.63(b)(3) that are filed more than three months after the issue date
of a final action (at $500 for paper filing and $400 for filing through
TEAS or the Electronic System for Trademark Trials and Appeals
(ESTTA)). Requests for reconsideration are documents filed after a
final action that respond to the outstanding refusals or requirements
(see Trademark Manual of Examining Procedure (TMEP) Sec. 709.05). They
include an applicant's request to the TTAB, filed within six months of
the issue date of a final action, whether filed with or after a notice
of appeal and whether it is denominated as a request for
reconsideration or is captioned as something else, such as a request
for remand. It does not include any filing with the TTAB after the
applicant has filed its appeal brief (see Trademark Trial and Appeal
Board Manual of Procedure (TBMP) Sec. 1209.04). This new proposed fee,
imposed when the filing is more than three months after the issue date
of a final action, is designed to encourage applicants to submit these
filings earlier in the response period and to recover costs associated
with processing all requests for reconsideration.
A new $50 fee is also proposed for filing a letter of protest,
along with new regulations that codify letter-of-protest procedures.
The new proposed fee and procedures are designed to help offset
processing costs and deter the filing of unsupported or irrelevant
letters of protest, while not discouraging the filing of relevant,
well-supported letters of protest. The new regulatory section is based
on existing, longstanding procedures for letters of protest, which are
currently set forth in the TMEP, as well as the procedures set out in
the patents rules in 37 CFR 1.290 and 1.291 and the Manual of Patent
Examining Procedure (MPEP) governing third-party submissions concerning
pending applications, which serve a function similar to letters of
protest.
The Office proposes a new fee structure to encourage registrants to
proactively perform sufficient due
[[Page 37042]]
diligence before filing a section 8 or section 71 affidavit to
determine the goods or services for which the registered mark is no
longer in use and delete them from the registration. The USPTO herein
proposes two fee levels for amendments to registrations to delete
goods, services, and/or classes. The USPTO proposes a $0 fee if the
only amendment made in a request under section 7 of the Act (section 7
request), 15 U.S.C. 1057(e), that is filed prior to submission of a
section 8 or section 71 affidavit is the deletion of goods, services,
and/or classes. As always, no additional fee would be incurred for
section 8 or section 71 affidavits that specify fewer than all of the
goods or services listed in the registration when the affidavit is
filed, which results in the deletion of goods or services not included
in the affidavit from the registration. However, if goods, services,
and/or classes are deleted in a section 7 request, a response to Office
action, or a voluntary amendment after submission and prior to
acceptance of a section 8 or section 71 affidavit, the proposed per-
class fee of $250 for submissions filed through TEAS and $350 for
submissions permitted to be filed on paper would be charged. To
implement the new fee requirement, corresponding new regulations are
also proposed at Sec. Sec. 2.161(c) and 7.37(c). In addition, the
USPTO proposes to revise the section titles and restructure Sec. Sec.
2.161 and 7.37 to set out the requirements for section 8 and section 71
affidavits more clearly. Except for the new provision regarding the fee
required for deletions made after submission and prior to acceptance of
the affidavit, the substantive text of Sec. Sec. 2.161 and 7.37 has
not otherwise been revised.
Finally, as discussed below, 16 fees related to TTAB filings are
established or adjusted in this proposed rule: 10 fees would be
increased for initiating a proceeding, and six new filing fees would be
established. The new and adjusted fees are generally designed to
recover more of the costs of TTAB procedures, to reduce the extent to
which they are subsidized by trademark fee collections, and to advance
policy objectives. The USPTO also proposes to revise Sec. 2.114(a) to
provide that a partial refund of the filing fee for a petition to
cancel may be made in cases involving only a nonuse or abandonment
claim, when default judgment is entered in the case, where there was no
appearance by a defendant, and where no filings were made other than
the petition to cancel.
Rulemaking goals and strategies: Consistent with federal fee
setting standards, the Office conducted a biennial review of fees,
costs, and revenues that began in 2019 and found that fee adjustments
are necessary to provide the resources needed to improve trademark
operations and to implement the USPTO 2018-2022 Strategic Plan
(Strategic Plan). As a result, the proposed fee adjustments outlined in
this proposed rule directly align with the Office's strategic goals and
key objectives as outlined in this section. Consistent with the USPTO's
strategic goals and obligations under the AIA, the overall objective of
this rulemaking is to ensure the fee schedule generates sufficient
revenue to recover the prospective aggregate costs of trademark and
TTAB strategic improvements and operations, including the associated
administrative costs. Fees must be set at levels projected to cover the
cost of future budgetary requirements and maintain an operating reserve
at a sufficient level. Trademark applications in FY 2019 represented
filings in a record number of over 673,000 classes of goods/services.
However, in the last two recessions, new application filings declined
(2001, by -21.0%; 2002, by -12.7%; and 2009, by -12.3%), demonstrating
the sensitivity of trademark filings, and therefore total revenues, to
general economic conditions. So far, the current economic downturn has
produced similar estimates of trademark application filing declines.
However, during ordinary economic times, application filings generally
have increased by an average historical rate of between 7% and 8% per
year. USPTO anticipates a return to this historical trend as trademark
applicants return to expected activities. To ensure its ability to keep
pace with demand, the USPTO is in the midst of a multi-year IT systems
and infrastructure upgrade, which is critical to the future of the U.S.
trademark registration system and represents a significant cost to the
Office.
The current fee schedule is insufficient to meet future budgetary
requirements to: (1) Meet the expenses that will result from projected
filings based on expectations for fee revenues; (2) recover the costs
necessary to support trademark and TTAB operations and administrative
services; (3) make necessary investments in IT systems, intellectual
property (IP) policy, and USPTO programs related to trademark and TTAB
operations; and (4) achieve optimal operating reserve levels to ensure
financial sustainability. Budgetary requirements have increased by 22%
from FY 2019 to FY 2020 to address unplanned pay raises, additional
review for potential fraud, post-registration audits, agency
administrative operations, and continued investments in IT that require
additional funding beginning in FY 2020. Without the proposed fee
adjustments, based on the assumptions found in the FY 2021
Congressional Justification, budgetary requirements would exceed
revenues and available operating reserve balances beginning in FY 2022
through FY 2025 (see Table 1).
Table 1--Trademark Financial Outlook Without Proposed Fees--FY 2021-FY 2025
----------------------------------------------------------------------------------------------------------------
Dollars in millions
-------------------------------------------------------------------------------
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025
----------------------------------------------------------------------------------------------------------------
Projected Fee Collections....... $367 $390 $412 $430 $447
Other Income.................... 6 6 6 6 6
Total Projected Fee Collections 373 396 418 436 453
and Other Income...............
Budgetary Requirements.......... 419 460 462 478 497
Funding to (+) and from (-) -46 -64 -44 -42 -44
Operating Reserve..............
EOY Operating Reserve Balance... 26 (38) (81) (123) (167)
Over/(Under) $75M Minimum Level. (49) (113) (156) (198) (242)
Over/(Under) Optimal Level...... (184) (268) (312) (362) (415)
----------------------------------------------------------------------------------------------------------------
Table 2 below shows the available revenue and operating reserve
balances by fiscal year, including the proposed fee rates in the
projected fee collections. The numbers in the table below can be found
in the FY 2021 Congressional
[[Page 37043]]
Justification and were developed in late calendar year 2019, prior to
the COVID-19 outbreak. Under current circumstances, it is difficult to
predict what the actual numbers will be. However, since USPTO was
projecting insufficient funding even during an economic expansion (see
Table 1) and the trademark financial outlook has only worsened since
the onset of the pandemic, USPTO still believes that a fee increase
will be necessary to put the Office on a sustainable financial path.
Table 2--Trademark Financial Outlook Including Proposed Fees--FY 2021-FY 2025
----------------------------------------------------------------------------------------------------------------
Dollars in millions
-------------------------------------------------------------------------------
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025
----------------------------------------------------------------------------------------------------------------
Projected Fee Collections....... $445 $472 $498 $519 $539
Other Income.................... 6 6 6 6 6
Total Projected Fee Collections 451 478 504 525 545
and Other Income...............
Budgetary Requirements.......... 419 460 462 478 497
Funding to (+) and from (-) 31 18 42 47 48
Operating Reserve..............
EOY Operating Reserve Balance... 103 121 163 211 259
Over/(Under) $75M Minimum Level. 28 46 88 136 184
Over/(Under) Optimal Level...... (107) (109) (68) (28) 10
----------------------------------------------------------------------------------------------------------------
Additional information on estimated costs can be found in the USPTO
FY 2021 Congressional Justification at https://www.uspto.gov/about-us/performance-and-planning/budget-and-financial-information, which
includes two revenue estimates, one based on the current fee schedule
and another based on this proposed rule (see Appendix IV: USPTO Fees--
Change from FY 2020 PB to FY 2021 PB).
The USPTO, as a fully fee-funded agency, retains an operating
reserve to ensure sufficient financial resources are available to
support and promote public confidence in the U.S. IP system. The
operating reserve enables the USPTO to maintain operations by absorbing
and responding to immediate and temporary changes in its economic and
operating environments or circumstances, such as unexpected economic
downturns, reducing the risk for short-term financial actions and
providing the security for long-term strategic investments, such as IT
development projects that are crucial to operations and customer
support. An adequate operating reserve also allows the USPTO to
continue serving its users in the event of a short-term lapse in
congressional appropriations or a sudden economic downturn. Trademark
filings exhibit a strong connection to domestic and global economic
activity, responding quickly to economic shocks, as experienced in the
2001-2002 and 2009 recessions and most recently in 2020. The operating
reserve is the primary tool to mitigate the sudden impact of these
unforeseen events.
Another fee setting goal of this rulemaking is to set individual
fees to further key IP protection policy objectives while taking into
account the cost of a particular service. The USPTO seeks to enhance
trademark protection for IP rights holders by offering application-
processing options and promoting IP protection strategies.
Aligning fees with costs: The first fee setting policy
consideration is to set and adjust trademark fees to more closely align
those fees with the costs of providing the relevant services. The
overall goal is to achieve total cost recovery from fee collections for
trademark and TTAB operations, including associated administrative
services. In determining which fees to set or adjust, this proposed
rule targets changes to the category of fees where the gap between the
cost of the service and the current fee rate is the greatest, and
addresses policy objectives. Application filing fees, petition fees,
and TTAB fees do not fully cover the costs of processing and
examination for those services. Instead, these costs are recovered or
subsidized from fees paid for intent-to-use and post-registration
maintenance filings that return more than the costs of processing such
filings. For example, using FY 2019 earned revenue compared to costs or
expenses, application filing fees recovered 65% of expenses, petition
(trademark processing) fees recovered 50% of expenses, and TTAB fees
recovered just 31% of expenses (see Table 3).
Table 3--Earned Revenue vs. Expense by Trademark Product
----------------------------------------------------------------------------------------------------------------
Earned revenue
FY 2019 earned vs. expense or
Trademark products revenue FY 2019 expense FY 2019 variance cost recovery
(%)
----------------------------------------------------------------------------------------------------------------
Application Filings..................... $190,457,284 $291,678,207 ($101,220,923) 65
Intent to Use/Use Fees.................. 49,885,175 17,154,805 32,730,370 291
Trademark Processing Fees............... 2,619,600 5,212,800 (2,593,200) 50
Maintaining Exclusive Rights............ 79,942,987 13,991,853 65,951,134 571
Madrid Protocol......................... 4,294,675 1,006,834 3,287,841 427
Other Trademark Fees.................... 10,571,283 8,902,431 1,668,852 119
Trademark Trial and Appeal Board........ 8,452,900 27,633,083 (19,180,183) 31
-----------------------------------------------------------------------
Total............................... 346,223,905 365,580,013 (19,356,109) ................
----------------------------------------------------------------------------------------------------------------
The proposed fee schedule would increase the percentage of fee
revenues for application filings by 21%, for petition filings by 101%,
and for TTAB filings by 58% overall, thereby increasing the cost
recovery for these services (see Table 4). If the proposed fee schedule
were implemented, based on the assumptions found in the FY
[[Page 37044]]
2021 Congressional Justification, the USPTO projects that trademark fee
collections in total would increase by an average of 21% per year, or
$77 million, to $92 million per year over the five-year planning period
as compared to the baseline (see Table 5).
Table 4--Increase in Cumulative Revenue, by Product
----------------------------------------------------------------------------------------------------------------
Projected cumulative revenue, FY
2021-2025
Trademark products ------------------------------------ Increase (%)
Current fee
rates (baseline) NPRM fee rates
----------------------------------------------------------------------------------------------------------------
Application Filings....................................... $1,078,986,925 $1,300,666,600 21
Maintaining Exclusive Rights.............................. 517,806,550 659,008,548 27
Intent to Use/Use......................................... 292,887,325 292,887,325 0
Madrid.................................................... 29,201,550 42,258,078 45
TTAB...................................................... 52,602,400 83,164,508 58
Petition.................................................. 17,508,400 35,147,450 101
Other Processing Fees..................................... 58,391,905 58,391,905 0
-----------------------------------------------------
Total................................................. 2,047,385,055 2,471,524,413 21
----------------------------------------------------------------------------------------------------------------
Table 5--Annual Increases in Aggregate Revenue
--------------------------------------------------------------------------------------------------------------------------------------------------------
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 Average
--------------------------------------------------------------------------------------------------------------------------------------------------------
Aggregate Revenue--Baseline............................. $367,001,856 $390,327,171 $412,360,921 $430,391,196 $447,303,911 $409,477,011
Aggregate Revenue--NPRM................................. $443,946,233 $471,660,715 $497,754,151 $519,026,516 $539,136,798 $494,304,883
$ Increase.............................................. $76,944,377 $81,333,544 $85,393,230 $88,635,320 $91,832,887 $84,827,872
% Increase.............................................. 21.0% 20.8% 20.7% 20.6% 20.5% 20.7%
--------------------------------------------------------------------------------------------------------------------------------------------------------
Estimated revenues are based on adjustments made from public
comments included in this rulemaking.
Protecting the integrity of the trademark register: The second fee
setting policy consideration is to set or adjust fees to improve the
accuracy of the trademark register. The accuracy of the trademark
register as a reflection of marks that are actually in use in commerce
in the U.S. for the goods/services identified in the registrations
listed therein serves a critical purpose for the public and for all
registrants. An accurate register allows the public to rely on the
register to determine potential trademark rights. By registering
trademarks, the USPTO has a significant role in protecting consumers,
as well as providing important benefits to American businesses, by
allowing them to strengthen and safeguard their brands and related
investments. The public relies on the register to determine whether a
chosen mark is available for use or registration. When a person's
search of the register discloses a potentially confusingly similar
mark, that person may incur a variety of resulting costs and burdens,
such as those associated with investigating the actual use of the
disclosed mark to assess any conflict, initiating proceedings to cancel
the registration or oppose the application of the disclosed mark,
engaging in civil litigation to resolve a dispute over the mark, or
changing business plans to avoid the use of that person's chosen mark.
In addition, such persons may incur costs and burdens unnecessarily if
a registered mark is not actually in use in commerce in the U.S. or is
not in use in commerce in connection with all the goods/services
identified in the registration. An accurate and reliable trademark
register helps avoid such needless costs and burdens.
This proposed rule sets and adjusts fees to encourage actions by
trademark filers that help facilitate more efficient processing and the
prompt conclusion of application prosecution by assessing fees for
requests for reconsideration filed more than three months after a final
Office action and for second and subsequent extension requests to file
appeal briefs. In addition, filings that may result in a less accurate
register, including post-registration filings to maintain registrations
that may include goods or services for which the mark is no longer in
use, are among those filings targeted under this objective. The new fee
structure for requests for reconsideration and requests to delete
goods, services, and/or classes from a registration would protect the
integrity of the register and the efficiency of the process by
incentivizing both more timely filings and proactive action by
applicants and registrants. The increased efficiencies realized through
the proposed rule will benefit all applicants and registrants by
allowing registrations to be granted sooner and more efficiently by
removing unused marks and unsupported goods and services from the
register.
Improving the efficiency of USPTO processes: The third fee setting
policy consideration pertains to improving the efficiency of the
trademark and TTAB processes. To that end, this proposed rule targets
changes to fees that will administratively improve application and
appeal processing by incentivizing more complete and timely filings and
prosecution. For example, TEAS Plus, the lowest-cost TEAS application
filing option, has more stringent initial application requirements and
thus tends to result in a more complete application, which expedites
processing, shortens pendency, minimizes manual processing and the
potential for data-entry errors, and is thus more efficient for both
the filer and the USPTO. While the per-class fee for TEAS Plus would
increase by $25 to $250 under this proposal, the per-class fee for TEAS
Standard, which has less stringent initial application requirements, is
proposed to increase by $75 to $350, resulting in a difference of $100
in the per-class fees of the respective filing options (double the
current difference of $50), providing an increased financial incentive
to choose the TEAS Plus filing option.
Ensuring financial sustainability to facilitate effective trademark
operations: The fourth fee setting policy consideration pertains to
ensuring
[[Page 37045]]
sufficient revenue to recover the aggregate costs of trademark
operations in future years. Additional fees are necessary to fund the
multi-year project to upgrade IT systems and infrastructure, while also
maintaining a sufficient operating reserve balance to ensure
sustainable funding that will mitigate the risk of unplanned financial
disruptions that could threaten operations and planned investments.
Operating reserves are intended to mitigate operational risk caused by
a lack of financial resources. The USPTO defines an optimal balance and
a minimum acceptable balance for each operating reserve--the patent
operating reserve and the trademark operating reserve. The optimal
balances set the goal for building and maintaining the operating
reserves. The optimal trademark reserve has been determined to be six
months of operating or budgetary requirements based on a review of
environmental risk factors and financial volatility. Risks related to
spending and fee collections are analyzed, considering the likelihood
and consequence of each and its impact to financial stability, in
determining the optimal reserve levels.
An increase in fees will provide a stable financial foundation to
fulfill the USPTO mission and maintain performance. The budgetary
requirements of the USPTO are comprised of substantial fixed costs,
which may require increased fee rates to ensure revenue sufficient to
recover aggregate costs. The trademark fee schedule proposed here,
based on the assumptions found in the FY 2021 Congressional
Justification, will produce sufficient revenue to recover the aggregate
costs of trademark and TTAB operations, including executing USPTO
strategic goals, policy objectives, and initiatives in FY 2020 and
beyond; creating a better and fairer cost-recovery system that balances
subsidizing costs to encourage broader usage of IP rights-protection
mechanisms and participation by more trademark owners; promoting a
strong incentive for more efficient filing behaviors; and protecting
the federal trademark register as a reliable indicator of marks in use
in commerce. The projections of aggregate revenues and costs are based
on point-in-time estimates and assumptions that are subject to change.
There is considerable uncertainty in estimating both fee collections
and budgetary requirements in ordinary times, and even more so now. In
addition to the pandemic, a number of other risks could materialize
(e.g., even lower applications volumes, decreased renewals, the
recompetitions of major contracts, lease renewals, changing assumptions
about Presidentially authorized or congressionally mandated employee
pay raises, etc.) that could change the USPTO's budgetary outlook.
These estimates are refreshed annually in the formulation of the
USPTO's Budget, and the USPTO continues to gain new data as the
pandemic unfolds. As noted above, in addition to these dynamics
factors, the budgetary requirements of the USPTO are comprised of
substantial fixed costs, which could also influence increased fee rates
to ensure aggregate revenue recovers aggregate costs.
Individual fee rationale: Based on the assumptions found in the FY
2021 Congressional Justification, the USPTO projects the aggregate
revenue generated from current and proposed trademark fees will recover
the prospective aggregate costs of its trademark and TTAB operations
and associated administrative services. However, each individual
proposed fee is not set at an amount equal to the estimated cost of
performing the activities related to the fee. Instead, as described
above, some of the proposed fees are set to address increases in
budgetary requirements as well as balance several key policy factors,
and executing these policy factors through the trademark fee schedule
is consistent with the goals and objectives outlined in the Strategic
Plan. Once the cost recovery and key policy objectives are considered,
fees are set at, above, or below individual cost-recovery levels for
the service provided. Additional details on the cost methodologies used
to derive the historical fee unit expenses can be found in ``USPTO Fee
Setting--Activity Based Information and Trademark Fee Unit Expense
Methodology'' at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
Trademark application filing fees: This proposed rule would
increase all application filing fees by varying amounts. The filing fee
for a paper trademark application would increase by $150, from $600 per
class to $750 per class. The TEAS Plus application filing fee would
increase by $25, from $225 per class to $250 per class. The TEAS
Standard application filing fee would increase by $75, from $275 per
class to $350 per class. The fee for filing an application under
section 66(a) of the Act would increase by $100, from the equivalent of
$400 per class, as paid in Swiss francs, to the equivalent of $500 per
class, as paid in Swiss francs.
Also proposed is a decrease of the processing fee from $125 to $100
per class for failure to meet the filing requirements under Sec.
2.22(a) for a TEAS Plus application. Thus, if the processing fee is
required in a TEAS Plus application, the resulting per-class fee would
equal the per-class fee for a TEAS Standard application. If a decrease
in the processing fee were not enacted, the per-class fee for an
application initially filed as TEAS Plus would exceed the fee for TEAS
Standard, creating a disincentive to choose TEAS Plus, which, as noted
above, tends to be more efficient for both filers and the USPTO.
Fees for paper trademark filings: This proposed rule maintains the
cost differential for all paper filings to better align fees with
costs, with all trademark processing fees for paper filings set $100 to
$200 higher than the corresponding electronic filing fees (per class,
when applicable). Overall, it is more costly for the USPTO to process
paper filings than electronic filings, and that cost is not recovered
by the current fees for paper filings. Raising the fees for paper
filings will help offset the higher processing costs and move the USPTO
closer to total cost recovery.
At present, most filings are submitted electronically. For example,
in FY 2019, less than 0.02% of initial applications were filed on
paper. Moreover, a final rule published on July 31, 2019 (84 FR 37081),
which became effective on February 15, 2020 (84 FR 69330), requires all
applicants, registrants, and parties to TTAB proceedings to file
electronically through TEAS all trademark applications based on section
1 and/or section 44 of the Act, 15 U.S.C. 1051, 1126, and all
submissions filed with the USPTO concerning applications or
registrations, with limited exceptions. Thus, an increase to paper
filing fees would have no impact on the vast majority of applicants and
registrants who are required to file documents electronically.
Other trademark processing fees: The USPTO also proposes to
increase certain other trademark processing fees to further key policy
goals. This proposed rule sets out increases to the fees for petitions
to the Director as well as section 8 and section 71 affidavits. In
addition, this proposed rule sets new fees and procedural regulations
for filing a letter of protest and new fees for filing a request for
reconsideration more than three months after a final Office action, and
for deleting goods, services, and/or classes from a registration after
submission and prior to acceptance of a section 8 or section 71
affidavit.
(1) Petitions to the Director in trademark matters: The USPTO
proposes to establish two levels of fees for petitions. This proposed
rule would increase the current fee for filing a
[[Page 37046]]
petition to the Director for petitions filed under Sec. Sec. 2.146 or
2.147. It would also establish a separate fee for petitions to revive
filed under Sec. 2.66 that would be less than the fee for petitions
filed under Sec. Sec. 2.146 or 2.147. The proposed fees are intended
to facilitate effective trademark operations. The fee for
electronically filing a petition to the Director under Sec. Sec. 2.146
or 2.147 would increase from $100 to $250, and the fee for filing on
paper would increase from $200 to $350. The fee for electronically
filing a petition to revive an abandoned application under Sec. 2.66
would increase from $100 to $150, and the fee for filing on paper would
increase from $200 to $250.
Generally, petitions under Sec. 2.146 extend the trademark
registration and post-registration processes by introducing additional
processing and examination into the timeline, which may lead to
applications and registration maintenance documents remaining pending
for longer periods of time, potentially blocking others. By increasing
fees for these filings, the USPTO would discourage misuse of the
process through unnecessary filings that delay prosecution of an
application or registration maintenance document. The comments provided
in the TPAC report received by the USPTO also generally supported the
increases to the fees for petitions to the Director under Sec. 2.146
and a smaller increase for petitions under Sec. 2.66.
(2) Section 8 or section 71 affidavits: Fees from post-registration
filings have historically been set to recover more than the costs of
processing the filings. The fees are used to offset cost recovery for
application processing and examination as well as TTAB proceedings and
appeals. In general, fewer post-registration maintenance filings are
made by pro se and foreign registrants. Compounding this issue, pro se
and foreign owners comprise a growing share of new applicants. Based on
recent pre-pandemic trends, the overall percentage of registrations
being maintained is decreasing. Therefore, the USPTO anticipates that
it will face a continuing decrease in revenue from maintenance filings
going forward if adjustments are not made. Increasing fees for section
8 and section 71 affidavits is necessary to continue to provide cost-
recovery offsets and allow other fees to remain below their individual
unit costs.
Increased fees are also proposed for these filings in part because
of the post-registration audit program, which was implemented as a
result of the 2012 Post-Registration Proof-of-Use Pilot Program. During
the pilot program, section 8 or section 71 affidavits for 500
registrations were reviewed as to actual use of the marks in connection
with the goods and/or services identified in the registrations in order
to assess the accuracy and integrity of the trademark register. The
findings of the pilot program demonstrated a need for ongoing measures
for additional review of these filings on a permanent basis. Since
codifying the authority to require additional information and evidence
concerning the use of registered marks in connection with section 8 and
71 maintenance filings in 2017 (82 FR 6259), the USPTO has conducted
additional reviews of the actual use of the marks in 8,276 section 8 or
section 71 affidavits through January 1, 2020. In more than 50% of the
registrations undergoing the additional review, the registrations have
either been removed from the register or had goods or services deleted,
resulting in a more accurate trademark register. The proposed fee
increases would support the cost of this additional review.
(3) Letters of protest in trademark applications: The USPTO
proposes a new $50 fee for filing a letter of protest. A letter of
protest allows a third party to bring to the attention of the USPTO
evidence bearing on the registrability of a mark in a pending
application. The letter-of-protest procedure exists for the
administrative convenience of the Office and is not a substitute for
the statutory opposition and cancellation procedures available to third
parties who believe they would be damaged by registration of the
involved mark. It is intended to aid in examination without causing
undue delay and without compromising the integrity and objectivity of
the ex parte examination process, which involves only the applicant and
the Office. For this reason, the protestor is not permitted to submit
legal arguments, contact the examining attorney assigned to the subject
application, or participate in any Office proceedings relating to the
protest or the application to which it is directed. The limited
involvement of the third party ends with the filing of the protest. The
questions of whether or not evidence is relevant to a refusal ground
appropriate in ex parte examination, a refusal should be made, or a
registration will issue are matters for the Office to determine during
the ex parte examination process that occurs between the applicant and
the Office acting on behalf of the public.
Filing a letter of protest currently requires no fee, but the
Office incurs costs associated with the work of reviewing and
processing each letter. The filing volume for letters of protest has
steadily increased in recent years, with the USPTO receiving 2,726 in
FY 2017, 3,480 in FY 2018, and 4,106 in FY 2019. Thus, letters of
protest continue to generate increasing additional expenses, and under
the current schedule where letters can be filed without any fee, these
expenses would likely only increase in the future.
Many preliminary commenters expressed concerns about this proposed
fee, noting that letters of protest provide a valuable service to the
USPTO and should not be discouraged by requiring a fee for submission.
The USPTO recognizes that, in many cases, letters of protest assist the
Office in obtaining evidence to support refusals of registration,
helping to avoid marks that are ineligible for registration being
placed on the trademark register. Currently, all letters of protest
must be reviewed in accordance with the procedures set out in TMEP
Sec. 1715 to determine whether: (1) The issue raised is an appropriate
subject for a letter of protest; (2) the protest was submitted before
or after publication of the subject application; (3) the nature,
amount, and format of the evidence complies with the requirements set
out in the TMEP; and (4) the submitted evidence meets the relevant
standard for entry in the record and review by the examining attorney.
If the letter of protest is filed before publication of the subject
application, the evidence must be relevant to the identified ground(s)
for refusal, and the entry of evidence into the application record
merely serves to bring the submitted evidence to the attention of the
examining attorney, who determines whether a refusal or requirement
should be raised or ultimately made final. If the letter of protest is
filed on the date of, or within 30 days after, publication of the
subject application, the evidence must establish a prima facie case for
refusal on the identified ground(s), such that failure to issue a
refusal would likely result in the issuance of a registration in
violation of the Act or regulations under parts 2 or 7 of this section.
In FY 2019, the evidence in approximately 25% of pre-publication
letters of protest and 94% of post-publication letters of protest was
not forwarded to the examining attorney. This suggests that a
significant portion of filings do not contain relevant information or
evidence, or are otherwise unnecessary. These filings generate
additional costs without a corresponding benefit.
Seeking to balance the commenters' concerns with the need to
recover some costs, the proposed fee of $50 is set at a level high
enough to partially offset processing costs and deter the filing of
[[Page 37047]]
unsupported or irrelevant filings, but low enough so as not to
discourage the filing of relevant, well-supported letters of protest.
This fee level is also consistent with the TPAC recommendations in that
it falls within the $20 to $100 fee range suggested by the TPAC report.
In connection with this proposed fee, the USPTO also proposes a new
regulatory section, at 37 CFR 2.149, which sets out the procedures for
letters of protest. The new regulatory section is based on the existing
longstanding procedures for letters of protest, which are currently set
forth in the TMEP, with appropriate modifications that more closely
align the procedures with those for similar third-party submissions and
protests in patent applications under 37 CFR 1.290 and 1.291 and as set
out in MPEP Sec. Sec. 1134 and 1901. This action is being undertaken
at this time due to the rising volume of letters of protest in recent
years, which has resulted in the need to codify procedures for
submission of such protests in the regulations.
Under the procedures set forth in the proposed regulatory text at
Sec. 2.149, a letter of protest must be timely filed through TEAS and
must include: (1) The proposed fee; (2) the serial number of the
pending application that is the subject of the protest; (3) an itemized
evidence index that includes identification of the documents, or
portions of documents, being submitted as evidence and a concise
factual statement of the relevant grounds for refusal of registration
appropriate in ex parte examination that each identified item supports;
and (4) a clear and legible copy of the supporting evidence identified
in the evidence index. As noted above, if the letter of protest is
filed before publication of the subject application, the evidence must
be relevant to the identified ground(s) for refusal. If filed on or
within 30 days after publication of the subject application, the
evidence must establish a prima facie case for refusal on the
identified grounds, such that failure to issue a refusal or make a
requirement would likely result in issuance of a registration in
violation of the Act or regulations under parts 2 or 7 of this section.
The letter-of-protest process is intended to provide an opportunity
for the protestor to efficiently and effectively provide relevant
evidence in support of the proposed legal grounds for refusing
registration of the application identified in the submission. It is
inappropriate for the protestor to ``dump'' evidence and leave it to
the Office to determine its possible relevance. Therefore, an index is
required for all submissions listing the documents submitted as
evidence and the ground(s) for refusal each item of evidence supports.
In addition, the proposed procedures also require that the submission
not total more than 10 items of evidence in support of a specified
ground of refusal and more than 75 total pages of evidence without a
detailed and sufficient explanation that establishes the special
circumstances that necessitate providing more than 10 items of evidence
per refusal ground or more than 75 total pages of evidence. This
requirement encourages the submission of evidence that is succinct, not
duplicative, and limited to the most relevant evidence. It should be a
rare situation in which more than 10 items of evidence or 75 total
pages of evidence is necessary to support the proposed legal grounds
for refusal. However, some examples of situations that might constitute
such special circumstances are when: (1) A subject application includes
multiple classes and the protestor needs to provide evidence of
relatedness of the goods/services for all classes in the application;
(2) evidence submitted to support a refusal for descriptiveness
consists of fewer than 10 discrete items, but each item comprises
multiple pages, totaling more than 75 pages; or (3) a protestor raises
more than one ground for refusal and the evidence necessary to support
all grounds raised totals more than 10 items or 75 pages.
A letter of protest submitted by a third party is not made part of
the application record to preserve the ex parte nature of examination.
If the USPTO determines that the submission complies with the proposed
regulations, only the specified grounds for refusal and the provided
evidence relevant to the grounds for refusal would be included in the
application record for consideration by the examining attorney. A third
party filing a letter of protest will not receive any communication
from the USPTO relating to the submission other than acknowledgement
that it has been received by the Office and notification of whether the
submission is found to be compliant or non-compliant. Also, the Office
will not accept amendments to a non-compliant submission that was
previously filed or requests to reconsider a compliance determination.
Rather, the third party may submit a new letter of protest that is
compliant if the time period for submitting a letter of protest has not
closed. A protestor does not, by the mere filing of a protest, obtain a
``right'' to argue the protest before the Office. As noted above, the
questions of whether or not evidence is relevant to a refusal ground
appropriate in ex parte examination, a refusal will be made, or a
registration will issue are matters for the Office to determine as part
of the ex parte examination process that occurs between the applicant
and the Office acting on behalf of the public. Therefore, the proposed
procedures also provide that: (1) The Office's determination whether to
include submitted evidence in the record of an application would be
final and non-petitionable, (2) the limited involvement of the third
party ends with the filing of the letter of protest, and (3) the third
party may not directly contact the examining attorney assigned to the
application.
(4) Requests for reconsideration in trademark applications: The
USPTO proposes a new fee for a request for reconsideration filed more
than three months, but within six months, after the issue date of a
final action or with a petition to revive an abandoned application. The
proposed fee is $400 for a TEAS submission and $500 for a paper
submission. No fee would be incurred for requests filed within three
months of the issue date of a final action.
As noted above, a request for reconsideration is a document filed
within six months of the issue date of a final action that responds to
the outstanding refusals or requirements. In some cases, it may also be
filed with a petition to revive an application abandoned for failure to
respond to a final action within the six-month response period. In such
cases, the request for reconsideration would be filed more than six
months after the issue date of the final action. It also includes an
applicant's request to the TTAB, filed within six months of the issue
date of a final action, whether filed with or after a notice of appeal
and whether it is denominated as a request for reconsideration or is
captioned as something else, such as a request for remand (see TMEP
Sec. 709.05 and TBMP Sec. 1209.04). In some cases, multiple requests
are filed. Examining attorneys must review the request(s) for
reconsideration and take appropriate action, which frequently involves
issuing a subsequent Office action that discusses any new evidence
submitted with the request. In some circumstances, Office procedure
requires the examining attorney to issue a new refusal, with a new six-
month response deadline.
Because requests for reconsideration require additional
examination, they generate additional costs for the USPTO. In addition,
requests for reconsideration
[[Page 37048]]
lengthen the examination process, thereby increasing overall
examination pendency, particularly when filed later in the response
period or after the filing of a notice of appeal and prior to the
expiration of six months from the issue date of the final action. The
proposed fee is intended to recover costs associated with requests for
reconsideration and encourage applicants to submit these filings
earlier in the response period for the final action.
The TPAC report expressed concerns that the proposed fee was too
high and could discourage the filing of requests for reconsideration,
which often resolve issues and avoid the need for an appeal. The TPAC
report therefore suggested that the Office consider not charging a fee
for requests filed within three months of the final Office action. The
USPTO has considered and adopted the suggestion from the TPAC report.
(5) Deletion of goods, services, and/or classes from registrations:
The USPTO initially proposed fees for each good or service deleted as a
result of a post-registration audit or an adverse TTAB finding of $200
if submitted on paper or $100 if submitted through TEAS. The TPAC
report expressed concerns regarding how the fees would be assessed
because it could be difficult to determine what is a separate good or
service in some situations, and some registrants with extensive goods
and services could potentially be assessed onerous fees to delete
specific goods or services within a class. The TPAC report supported a
fee for the deletion of goods or services as a result of a post-
registration audit if the proposed fees were charged per each class in
which goods or services are deleted. The report also supported a no-fee
option for voluntarily cancelling goods or services from a registration
at any time prior to an audit. The TPAC report did not support the
proposed new fees following an adverse TTAB finding, stating that it
would be unclear when the fee would apply and how it would be
implemented.
Currently, amendments to registrations may be made by filing a
section 7 request for amendment or correction of a registration for
$100, if submitted through TEAS, or $200, if filed on paper. After
consideration of the TPAC response, the USPTO proposes to set a $0 fee
for a section 7 request that is filed through TEAS prior to the
submission of a section 8 or section 71 affidavit and consists only of
a request to delete specified goods, services, and/or classes. As noted
above, no additional fee would be incurred for section 8 or section 71
affidavits that specify fewer than all of the goods or services listed
in the registration when the affidavit is filed, which results in the
deletion of goods or services not included in the affidavit from the
registration. However, if goods, services, and/or classes are deleted
in a section 7 request, a response to Office action, or a voluntary
amendment filed after submission and prior to acceptance of a section 8
or section 71 affidavit, the USPTO proposes a new fee of $250 per
class, if filed through TEAS, or $350 per class, if a paper filing is
permitted, for deleting goods, services, and/or classes from the
registration.
The proposed no-fee option would be available to, and the $250 (or
$350) per-class fee would be assessed against, all registrants. Thus,
they are not related to a post-registration proof-of-use audit or a
TTAB finding. The proposals are intended to improve the accuracy and
integrity of the register by encouraging all registrants to proactively
perform sufficient due diligence before filing a section 8 or section
71 affidavit to determine the goods, services, and/or classes for which
the registered mark is no longer in use and delete them from the
registration.
TTAB fees: The Office proposes to set or adjust 16 TTAB-related
fees: 10 fees would be increased for initiating a proceeding, and six
new filing fees would be established. The TTAB would also obtain
discretion to grant a refund of a portion of the filing fee for a
petition to cancel.
(1) Existing fees at the TTAB: In an attempt to address better
alignment of fees with the costs of providing TTAB services, the
initial fee proposal presented to the TPAC included an across-the-board
increase in TTAB fees for petitions for cancellation, notices of
opposition, and ex parte appeals of $200 per class. The TPAC report
generally supported an increase in filing fees for petitions to cancel
and notices of opposition on the basis that the proposed increases are
justified on a cost-recovery rationale, noting the high average unit
cost for these proceedings. The TPAC report and some commenters
observed that many petitions to cancel and notices of opposition are
decided by default judgment. Commenters objecting to the preliminary
proposed fee increase for petitions to cancel expressed their belief
that the increase could deter filings based on abandonment or nonuse,
which would impact the USPTO's objective of removing marks from the
trademark register that are no longer being used.
In consideration of these observations, the Office proposes an
increase of $200 per class for petitions for cancellation and notices
of opposition. The Office also proposes to amend Sec. 2.114(a) to
allow the USPTO discretion to refund a portion of the petition fee in
cases of default judgment where there is no appearance by a defendant
and no filings are made other than the petition to cancel, reflecting
reduced work needed on the part of the TTAB; consequently, this amount
is in excess of that required to offset TTAB costs. The resulting lower
net fee for a petition to cancel that meets these characteristics also
furthers the policy goal of not discouraging the filing of petitions to
cancel by petitioners with knowledge that a registered mark is no
longer in use, or was never put to use, and therefore should be removed
from the register. The refund would be in the amount of $200. Compared
to cancellation proceedings, an opposition is less likely to be
determined by default judgment based on abandonment or nonuse, because
the applicants involved tend to be actively engaged with the USPTO
through the examination process up to the opposition, and the Office is
not proposing to allow for refunds concerning notices of opposition.
The TPAC report expressed some concern about the preliminary
proposed increase for filing a notice of ex parte appeal, noting that,
for various reasons, many appeals are resolved before an appeal brief
is filed. Some commenters expressed their belief that the proposed
increase would negatively impact small businesses and individuals. In
consideration of the comments, the Office herein proposes to increase
the filing fees for a notice of appeal to $325 per class if filed on
paper and $225 per class if filed through ESTTA, which is a $25
increase (rather than the $200 increase to both fees in the preliminary
proposal).
Fee increases are proposed for filing requests for an extension of
time to file an opposition. Under the current structure, applicants may
request: (1) An initial 30-day extension for no fee, (2) a subsequent
60-day extension for a fee of $100 for electronic filings and $200 for
paper filings, and (3) a final 60-day extension for a fee of $200 for
electronic filings and $300 for paper filings. The Office proposes to
maintain this tiered structure with an increase of $100 for the first
60-day electronic extension and $200 for the final 60-day electronic
extension. Paper-filed extension requests are proposed to increase by
$200 for each filing. The current and proposed filing fees are per
application, not per class.
These proposed fees are designed to yield efficiencies by
encouraging
[[Page 37049]]
potential opposers to make decisions regarding filing an opposition
sooner, thus reducing delays to applicants whose filings have been made
the subject of extensions of time to oppose. Additionally, by
encouraging earlier decisions to initiate proceedings, the uncertainty
experienced by these applicants will be ameliorated by having their
applications proceed to determination on the merits sooner. This should
also help to protect the integrity of the trademark register by
encouraging timely decisions and filings to ensure that the rights of
other applicants and the public are not adversely affected.
The TPAC report expressed some concerns over the proposed increase
in these fees, noting that extension fees were implemented about three
years prior and that raising them may result in a higher number of
oppositions being filed because the decision is rushed. Some commenters
were concerned that the proposed increases would impact smaller
entities and deter parties from working to settle prior to filing a
notice of opposition. Given that the USPTO also proposes increasing the
fee for the notice of opposition, the USPTO believes that the proposed
fees for extensions of time to oppose should encourage earlier
calculated decisions based on all of the available information,
including fees. Furthermore, the tiered fee structure reduces the
likelihood of potential opposers using the extensions merely to delay
registration of pending applications.
Approximately two-thirds of the cost of TTAB operations is
subsidized currently by revenue from other trademark processing fees.
The proposed increases in these TTAB fees will not recover the full
costs of TTAB operations but will increase revenues by 7% to bring fees
closer to the costs in order to provide better alignment between costs
and fees and bring the TTAB closer to full cost recovery. In general,
the TPAC commenters supported most of the proposed fee increases with
some modification because of the recognized costs for processing and
the cost differential.
Finally, these fees will help offset TTAB processing costs. In FY
2019, the USPTO received 20,502 requests for extensions of time to file
a notice of opposition. It is customary for requests that delay
processing of records, such as extensions, to incur a fee, which
offsets costs associated with processing the filing, as well as the
overall cost of processing appeals and trials. These fees are necessary
to help attain primary Office goals of recovering the aggregate costs
of operations, along with key policy considerations, such as
encouraging efficient processing.
(2) Fees for filing an appeal brief at the TTAB: The Office
proposes an increase in the fee for filing a notice of appeal of $25
per class, based on inflation, and the establishment of new fees for
filing an appeal brief of $300 per class if filed on paper and $200 per
class if filed through ESTTA. In its initial proposal submitted to the
TPAC, the Office had proposed raising the current fees for filing a
notice of appeal to the TTAB by $200 per class and also instituting new
fees for filing briefs in a notice of appeal. The TPAC supported
maintaining the current fees for filing a notice of appeal and the
proposed new fees for filing an appeal brief. This modification
addresses the TPAC report recommendations to apply the majority of the
aggregate increases in appeal fees to the costs incurred when an appeal
brief is filed, which increases the likelihood that the appeal will
have to be decided on the merits.
(3) Fees for filing requests for extension of time to file an
appeal brief at the TTAB: New fees are proposed for second and
subsequent requests for extensions of time to file an appeal brief. The
proposed fees are $200 per application if filed on paper and $100 per
application if filed through ESTTA. No fee is proposed for a first
request for extension of time to file an appeal brief.
In its report on the initial proposal, the TPAC expressed support
for the proposed new fees. Some commenters objected to the proposed new
fees, expressing their belief that minimal USPTO resources are required
to process such requests and that they increase the overall costs to
smaller entities. These proposed fees yield efficiencies by encouraging
applicants to move forward with their appeals, resulting in a quicker
resolution of the appeal, the pendency of which can adversely impact
the rights of other applicants and registrants. Implementing a two-
tiered fee structure minimizes costs to smaller entities, as there is
no fee for a first request for extension of time to file the appeal
brief.
(4) Fees for oral hearing at the TTAB: A new fee is proposed for a
request for an oral hearing. The proposed fee is $500 per proceeding.
In its report on the initial proposal, the TPAC expressed support
for the proposed new fee, noting that the TTAB incurs significant costs
in conducting oral hearings and all users subsidize the few parties
requesting oral hearings. Some commenters opposed the fee due to the
impact on small businesses and individuals. Oral hearings are not
requested in the vast majority of cases before the TTAB. They are
optional and are most useful when cases involve complex issues, a
complex record, or highly technical goods and services. The proposed
fee would help offset the costs of scheduling and conducting the
hearing, as well as the maintenance of equipment for remote
participation.
Discussion of Proposed Rule Changes
The USPTO proposes to revise Sec. 2.6(a)(1)(i) to increase the
per-class fee for filing an initial application on paper from $600 to
$750.
The USPTO proposes to revise Sec. 2.6(a)(1)(ii) to increase the
per-class fee for filing an application under section 66(a) of the Act
from $400 to $500.
The USPTO proposes to revise Sec. 2.6(a)(1)(iii) to increase the
per-class fee for filing a TEAS Standard application from $275 to $350.
The USPTO proposes to revise Sec. 2.6(a)(1)(iv) to increase the
per-class fee for filing a TEAS Plus application from $225 to $250.
The USPTO proposes to revise Sec. 2.6(a)(1)(v) to decrease the
processing fee under Sec. 2.22(c) from $125 to $100 per class.
The USPTO proposes to add Sec. 2.6(a)(11)(iii) to establish a fee
of $0 for filing a section 7 request to amend a registration through
TEAS prior to submission of a section 8 or section 71 affidavit and
that consists only of the deletion of goods, services, and/or classes.
The USPTO proposes to revise Sec. 2.6(a)(12)(i) and (ii) to
increase the per-class fee for filing a section 8 affidavit from $225
to $325 for a paper submission and from $125 to $225 for a TEAS
submission.
The USPTO proposes to add Sec. 2.6(a)(12)(iii) and (iv) to
establish fees for the deletion of goods, services, and/or classes
after submission and prior to acceptance of a section 8 affidavit. The
proposed Sec. 2.6(a)(12)(iii) and (iv) set the per-class fee at $350
for a paper submission and $250 for a TEAS submission.
The USPTO proposes to revise Sec. 2.6(a)(15) to establish separate
fees for petitions to the Director under Sec. Sec. 2.146 or 2.147 and
petitions to revive an abandoned application under Sec. 2.66. The
proposed revisions to Sec. 2.6(a)(15)(i) and (ii) set the fee for
filing a petition to the Director under Sec. Sec. 2.146 or 2.147 at
$350 for a paper submission and $250 for a TEAS submission. The
proposed addition of Sec. 2.6(a)(15)(iii) and (iv) set the fee for
filing a petition to revive an abandoned application under Sec. 2.66
at
[[Page 37050]]
$250 for a paper submission and $150 for a TEAS submission.
The USPTO proposes to revise Sec. 2.6(a)(16)(i) and (ii) to
increase the per-class fee for filing a petition to cancel from $500 to
$700 for a paper submission and from $400 to $600 for an ESTTA
submission.
The USPTO proposes to revise Sec. 2.6(a)(17)(i) and (ii) to
increase the per-class fee for filing a notice of opposition from $500
to $700 for a paper submission and from $400 to $600 for an ESTTA
submission.
The USPTO proposes to revise Sec. 2.6(a)(18) to increase the fee
for filing an ex parte appeal and to establish new fees for requests
for an extension of time to file an appeal brief and for filing a brief
in an ex parte appeal. The proposed revisions to Sec. 2.6(a)(18)(i)
and (ii) increase the per-class fee for filing an ex parte appeal from
$300 to $325 for a paper submission and from $200 to $225 for an ESTTA
submission. The proposed addition of Sec. 2.6(a)(18)(iii) sets the
per-application fee for filing a first request for an extension of time
to file an appeal brief at $0. The proposed addition of Sec.
2.6(a)(18)(iv) and (v) sets the per-application fee for filing a second
or subsequent request for an extension of time to file an appeal brief
at $200 for a paper submission and $100 for an ESTTA submission. The
proposed addition of Sec. 2.6(a)(18)(vi) and (vii) set the per-class
fee for filing a brief in an ex parte appeal at $300 for a paper
submission and $200 for an ESTTA submission.
The USPTO proposes to revise Sec. 2.6(a)(22)(i) and (ii) to
increase the fee for filing a request for an extension of time to file
a notice of opposition pursuant to Sec. 2.102(c)(1)(ii) or (c)(2) from
$200 to $400 for a paper submission and from $100 to $200 for an ESTTA
submission.
The USPTO proposes to revise Sec. 2.6(a)(23)(i) and (ii) to
increase the fee for filing a request for an extension of time to file
a notice of opposition pursuant to Sec. 2.102(c)(3) from $300 to $500
for a paper submission and from $200 to $400 for an ESTTA submission.
The USPTO proposes to add Sec. 2.6(a)(24) to establish a fee for
filing a request for an oral hearing before the TTAB of $500 per
proceeding.
The USPTO proposes to add Sec. 2.6(a)(25) to establish a fee of
$50 for the filing of a letter of protest per subject application.
The USPTO proposes to add Sec. 2.6(a)(26) to set out fees for a
request for reconsideration filed more than three months after a final
action and within six months of the issue date of a final action or
with a petition to revive an abandoned application. The USPTO proposes
to add Sec. 2.6(a)(26)(i) to establish a fee of $0 for filing a
request for reconsideration within three months after the issue date of
a final action through TEAS. The USPTO proposes to add Sec.
2.6(a)(26)(ii) and (iii) to establish a fee of $500 for a paper
submission and $400 for a TEAS or ESTTA submission for a request for
reconsideration filed more than three months after and within six
months of the issue date of a final Office action.
The USPTO proposes to revise Sec. 2.114(a) to provide that a
partial refund of the fee for a petition to cancel, equal to the
increase in that fee otherwise proposed by this rulemaking, may be made
in cases of default judgment where there was no appearance by a
defendant and no filings are made other than the petition to cancel.
The USPTO proposes to add Sec. 2.149, which codifies the
procedures and requirements for letters of protest.
The USPTO proposes to revise the section title and to restructure
Sec. 2.161 to set out the requirements for section 8 affidavits or
declarations more clearly. The USPTO also proposes to add, at revised
Sec. 2.161(c), a provision stating that if goods, services, and/or
classes are deleted from a registration after submission and prior to
the acceptance of a section 8 affidavit or declaration, the deletion
must be accompanied by the relevant fee under proposed Sec.
2.6(a)(12)(iii) or (iv) for each class from which goods, services, and/
or classes are deleted.
The USPTO proposes to revise Sec. 7.6(a)(6)(i) and (ii) to
increase the per-class fee for filing a section 71 affidavit from $225
to $325 for a paper submission and from $125 to $225 for a TEAS
submission.
The USPTO proposes to add Sec. 7.6(a)(6)(iii) and (iv) to
establish fees for the deletion of goods, services, and/or classes
after submission and prior to acceptance of a section 71 affidavit. The
proposed Sec. 7.6(a)(iii) and (iv) set the per-class fee at $350 for a
paper submission and $250 for a TEAS submission.
The USPTO proposes to revise the section title and to restructure
Sec. 7.37 to set out the requirements for section 71 affidavits or
declarations more clearly. The USPTO also proposes to add, at revised
Sec. 7.37(c), a provision stating that if goods, services, and/or
classes are deleted from a registration after submission and prior to
acceptance of a section 71 affidavit or declaration, the deletion must
be accompanied by the relevant fee under proposed Sec. 7.6(a)(6)(iii)
or (iv) for each class from which goods, services, and/or classes are
deleted.
Rulemaking Requirements
A. America Invents Act: This rulemaking proposes to set and adjust
fees under section 10(a) of the AIA as amended by the SUCCESS Act.
Section 10(a) of the AIA authorizes the Director to set or adjust by
rule any trademark fee established, authorized, or charged under the
Trademark Act for any services performed by, or materials furnished by,
the USPTO (see section 10 of the AIA, Pub. L. 112-29, 125 Stat. 284,
316-17, as amended by Pub. L. 115-273, 132 Stat. 4158). Section 10(e)
of the AIA sets forth the general requirements for rulemakings that set
or adjust fees under this authority. In particular, section 10(e)(1)
requires the Director to publish in the Federal Register any proposed
fee change under section 10 and include in such publication the
specific rationale and purpose for the proposal, including the possible
expectations or benefits resulting from the proposed change. For such
rulemakings, the AIA requires that the USPTO provide a public comment
period of not less than 45 days.
The TPAC advises the Under Secretary of Commerce for Intellectual
Property and Director of the USPTO on the management, policies, goals,
performance, budget, and user fees of trademark operations. When
adopting fees under section 10 of the AIA, the AIA requires the
Director to provide the TPAC with the proposed fees at least 45 days
prior to publishing them in the Federal Register. The TPAC then has at
least 30 days within which to deliberate, consider, and comment on the
proposal, as well as hold a public hearing(s) on the proposed fees. The
TPAC must make a written report available to the public of the
comments, advice, and recommendations of the committee regarding the
proposed fees before the USPTO issues any final fees. The USPTO will
consider and analyze any comments, advice, or recommendations received
from the TPAC before finally setting or adjusting fees.
Consistent with the requirements of the AIA, on August 28, 2019,
the Director notified the TPAC of the USPTO's intent to set or adjust
trademark fees and submitted a preliminary trademark fee proposal with
supporting materials. The preliminary trademark fee proposal and
associated materials are available at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
The TPAC held a public hearing in Alexandria, Virginia, on
September 23, 2019. Transcripts of this hearing and
[[Page 37051]]
comments submitted to the TPAC in writing are available for review at
https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting. The TPAC subsequently issued a report, dated October 31,
2019, regarding the preliminary proposed fees. The report can be found
online at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
B. Initial Regulatory Flexibility Analysis: The USPTO publishes
this Initial Regulatory Flexibility Analysis (IRFA) as required by the
Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.) to examine the
impact of the USPTO's proposed changes to trademark fees on small
entities and to seek the public's views. Under the RFA, whenever an
agency is required by 5 U.S.C. 553 (or any other law) to publish an
NPRM, the agency must prepare and make available for public comment an
IRFA, unless the agency certifies under 5 U.S.C. 605(b) that the
proposed rule, if implemented, will not have a significant economic
impact on a substantial number of small entities (see 5 U.S.C. 603,
605). This IRFA incorporates the discussion of the proposed changes in
the preamble above.
Items 1-5 below discuss the five items specified in 5 U.S.C.
603(b)(1)-(5) to be addressed in an IRFA. Item 5 below discusses
alternatives to this proposal that the USPTO considered.
1. Description of the Reasons That Action by the USPTO Is Being
Considered
The USPTO proposes setting and adjusting certain trademark fees as
authorized by section 10 of the AIA, as amended by Public Law 115-273,
132 Stat. 4158 (the SUCCESS Act). The fee schedule proposed under
section 10 in this rulemaking will, based on the assumptions found in
the FY 2021 Congressional Justification, recover the aggregate
estimated costs to the USPTO while achieving strategic and operational
goals, such as implementing measures to maintain trademark pendency and
high trademark quality, modernizing the trademark IT systems,
continuing important programs for stakeholder and public outreach,
enhancing operations of the TTAB, and maintaining a sufficient
operating reserve. Aggregate costs are estimated through the USPTO
budget formulation process with the annual preparation of a five-year
performance-based budget request. Revenues are estimated based on the
projected demand (workload) for trademark products and services and fee
rates.
2. Succinct Statement of the Objectives of, and Legal Basis for, the
Proposed Rule
The policy objectives of the proposed rule are to: (1) Better align
fees with costs, (2) protect the integrity of the trademark register,
(3) improve the efficiency of USPTO processes related to trademark and
TTAB operations, and (4) ensure financial sustainability to facilitate
effective trademark operations. The legal basis for the proposed rule
is section 10 of the AIA, as amended, which provides the authority for
the Director to set or adjust by rule any fee established, authorized,
or charged under the Trademark Act of 1946, 15 U.S.C. 1051 et seq., as
amended. See also section 31 of the Trademark Act, 15 U.S.C. 1113.
3. Description of and, Where Feasible, Estimate of the Number of
Affected Small Entities
The USPTO does not collect or maintain statistics in trademark
cases on small- versus large-entity applicants, and this information
would be required in order to determine the number of small entities
that would be affected by the proposed rule.
This proposed rule would apply to any entity filing trademark
documents with the USPTO. The USPTO estimates, based on the assumptions
found in the FY 2021 Congressional Justification, that during the first
full fiscal year under the fees as proposed, the USPTO would expect to
collect approximately $77 million more in trademark processing and TTAB
fees in FY 2021. The USPTO would receive an additional $40 million in
fees from applications for the registration of a mark, including
requests for extension of protection and subsequent designations; $3
million more from petitions, letters of protest, and requests for
reconsideration; and $28 million more for section 8 and section 71
affidavits. TTAB fees would increase by $6 million.
Trademark fees are collected for trademark-related services and
products at different points in time in the trademark application
examination process and over the lifecycle of the registration.
Approximately 55% of all trademark fee collections are from application
filing fees. Fees for TTAB proceedings and appeals comprise 2.5% of
revenues. Fees from other trademark activities, petitions, assignments
and certifications, and Madrid processing are approximately 5% of
revenues. Fees for filing post-registration and intent-to-use filings,
which subsidize the costs of filing, search, examination, and TTAB
activities, comprise 37.5%.
The USPTO's five-year estimated aggregate trademark fee revenue is
based on the number of trademark applications and other fee-related
filings it expects to receive for a given fiscal year and work it
expects to process in a given fiscal year (an indicator of future fee
workload and budgetary requirements). Within the iterative process for
estimating aggregate revenue, the USPTO adjusts individual fee rates up
or down based on policy and cost considerations and then multiplies the
resulting fee rates by appropriate workload volumes to calculate a
revenue estimate for each fee, which is then used to calculate the
aggregate revenue. Additional details about the USPTO's aggregate
revenue, including projected workloads by fee, are available at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
4. Description of the Reporting, Recordkeeping, and Other Compliance
Requirements of the Proposed Rule, Including an Estimate of the Classes
of Small Entities Which Will Be Subject to the Requirement and the Type
of Professional Skills Necessary for Preparation of the Report or
Record
The proposed rule imposes no new reporting or recordkeeping
requirements. The main purpose of the proposed rule is to set and
adjust trademark fees. However, the rule proposes new procedural
regulations at 37 CFR 2.149 for the submission of letters of protest.
The USPTO does not collect or maintain statistics in trademark cases on
small versus large entity applicants and is unable to provide an
estimate of the classes of small entities that will be subject to the
new procedural requirements.
5. Description of Any Significant Alternatives to the Proposed Rule
Which Accomplish the Stated Objectives of Applicable Statutes and Which
Minimize Any Significant Economic Impact of the Rule on Small Entities
The USPTO considered four alternatives, based on the assumptions
found in the FY 2021 Congressional Justification, before recommending
this proposal: (1) The adjustments included in this proposal, (2) an
across-the-board adjustment of 22%, (3) the unit cost of providing
services based on FY 2019 costs, and (4) no change to the baseline of
current fees. The alternatives are each explained here with additional
information regarding how each proposal was developed and the aggregate
revenue estimated. A description of the Aggregate Revenue Methodologies
is available at https://
[[Page 37052]]
www.uspto.gov/about-us/performance-and-planning/fee-setting-and-
adjusting.
The USPTO proposes to set or adjust trademark fees codified in 37
CFR parts 2 and 7. Fees are adjusted for all application filing types
(i.e., paper applications, applications filed via TEAS, and requests
for extension of protection under section 66(a) of the Trademark Act
(15 U.S.C. 1141f)). The USPTO also proposes to set or adjust certain
other trademark processing fees to further effective administration of
the trademark system. For example, the proposed rule increases the fees
for certain petitions to the Director as well as section 8 and section
71 affidavits, sets a new fee and proposes procedural regulations for
filing a letter of protest, and sets new fees for filing a request for
reconsideration more than three months after a final Office action and
for deleting goods, services, and/or classes from a registration after
submission and prior to acceptance of a section 8 or section 71
affidavit.
The USPTO chose the alternative proposed in this rule because it
will enable the Office to achieve its goals effectively and efficiently
without unduly burdening small entities, erecting barriers to entry, or
stifling incentives to innovate. The alternative proposed here secures
the USPTO's objectives for meeting the strategic goals of encouraging
broader usage of IP rights-protection mechanisms and participation by
more trademark owners and more efficient resolution of appeals and
inter partes proceedings at the TTAB by increasing revenue to meet the
Office's aggregate future costs. In particular, the new fee structure
for requests for reconsideration and requests to delete goods,
services, and/or classes from a registration would protect the
integrity of the register and the efficiency of the process by
incentivizing both more timely filings and proactive action by
applicants and registrants. The increased efficiencies realized through
the proposed rule will benefit all applicants and registrants by
allowing registrations to be granted sooner and more efficiently by
removing unused marks and unsupported goods and services from the
register. All trademark applicants should benefit from the efficiency
that will be realized under the proposed alternative.
With regard to the new regulations governing the filing of letters
of protest, the USPTO anticipates that the impact to affected entities
would be small. The proposed fee of $50 is set at a level high enough
to recognize there are processing costs and deter the filing of
unsupported or irrelevant filings, but low enough so as not to
discourage the filing of relevant, well-supported letters of protest.
In addition, the new procedural regulations for filing letters of
protest are not anticipated to significantly impact affected entities
because the proposed new regulations are based on existing informal
procedures set out in the TMEP.
Finally, the proposed new provision at Sec. 2.114(a) provides that
a partial refund of the fee for a petition to cancel may be made in
cases of default judgement where there was no appearance by a defendant
and no filings were made other than the petition to cancel. This change
would likely balance the cost recovery obtained from the increase in
the fee for a petition to cancel, a case type that has increased
markedly in recent years, against the benefit of having petitions to
cancel filed to remove registrations from the register when petitioners
have determined through their investigations that the registered marks
are no longer in use. In such situations, default judgments often
result, efficiently clearing the register of marks that would otherwise
stand as potential bars to applications seeking to register similar
marks. This reduces costs for applicants filing such applications.
The proposed fee schedule for this alternative (labeled
``Alternative 1--Proposed Alternative'') is available in the document
entitled ``Initial Regulatory Flexibility Act Tables'' at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
Another alternative to setting and adjusting the proposed fees that
was considered was to increase all fees by the same 22% across the
board. This alternative would maintain the status quo structure of cost
recovery, where processing and examination costs are subsidized by fees
paid for intent-to-use and post-registration maintenance filings (both
of which exceed the cost of performing these services), given that all
fees would be adjusted by the same escalation factor. This structure
would promote innovation strategies and allow applicants to gain access
to the trademark system through fees set below cost, while registrants
pay maintenance fees above cost to subsidize the below-cost front-end
fees. This alternative was ultimately rejected. Although this
alternative generates sufficient aggregate revenue to recover aggregate
operating costs, unlike the proposed fee structure, there would be no
improvements in fee schedule design. As such, this alternative would
not accomplish the stated objective of enhancing the integrity of the
register by incentivizing users to maintain accurate goods and
services. Further, it would not enhance the efficiency of the process,
as it would offer no new incentives for users to timely file
applications and other filings or to resolve appeals and inter partes
proceedings at the TTAB more expeditiously. The proposed fee schedule
for this alternative (labeled ``Alternative 2--Across-the-Board
Adjustment'') is available in the document entitled ``Initial
Regulatory Flexibility Act Tables'' at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
A third alternative that was considered was to set all trademark
fees to allow for the USPTO to recover 100% of the unit costs
associated with each product or service provided, based on the
historical unit costs of the products and services provided by the
USPTO. The USPTO uses activity based information to determine the unit
costs of activities that contribute to the services and processes
provided by individual fees. It is common practice in the federal
government to set a particular fee at a level that recovers the cost of
a given good or service. In Office of Management and Budget (OMB)
Circular A-25, User Charges, the OMB states that user charges (fees)
should be sufficient to recover the full cost to the federal government
of providing the particular service, resource, or good, when the
government is acting in its capacity as sovereign. Under the unit cost
recovery alternative, fees are generally set in line with the FY 2019
cost of providing the product or service. This alternative would
produce a structure in which application and processing fees would
increase significantly for all applicants and intent-to-use and post-
registration maintenance filing fees would decrease dramatically when
compared with current fees. In addition, these fees would change from
year to year with the ebb and flow in the number of applications
submitted. This alternative was rejected because it was determined that
the unit costs for any given product or service can vary from year to
year, such that a yearly review of all, and an adjustment to many,
trademark fees would be continually required and could also lead to
consumer confusion regarding the amount at which any given trademark
fee was currently set and what the relevant fee would be in the future.
Additionally, this alternative does not address improvements in fee
design to accomplish the stated objectives of encouraging broader usage
of IP rights-protection mechanisms and participation by more trademark
owners as well as practices that improve the
[[Page 37053]]
efficiency of the process. The USPTO recognizes that this approach does
not account for changes in the fee structure or inflationary factors
that could likely increase the costs of certain trademark services and
necessitate higher fees in the out-years. However, the USPTO contends
that the FY 2019 data is the best unit cost data available to inform
this analysis. The proposed fee schedule for this alternative (labeled
``Alternative 3--Unit Cost Recovery'') is available in the document
entitled ``Initial Regulatory Flexibility Act Tables'' at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
A final alternative to setting and adjusting the proposed fees
would be to take no action at this time regarding trademark fees and to
leave all trademark fees as currently set. This alternative was
rejected because, due to changes in demand for certain services and
rising costs, the Office has determined that a fee increase is needed
to meet future budgetary requirements as described in the FY 2021
Budget. As previously explained, the proposed fee schedule will assist
in promoting access to the trademark system, protecting the integrity
of the register, and promoting the efficiency of the trademark
registration process by incentivizing: (1) Maintenance of registrations
for goods and services for which marks are actually in use, (2) more
timely filing of applications and other documents, and (3) faster
resolution of appeals and inter partes proceedings at the TTAB. The fee
schedule for this alternative (labeled ``Alternative 4--Baseline--
Current Fee Schedule'') is available in the document entitled ``Initial
Regulatory Flexibility Act Tables'' at https://www.uspto.gov/about-us/performance-and-planning/fee-setting-and-adjusting.
6. Identification, to the Extent Practicable, of All Relevant Federal
Rules Which May Duplicate, Overlap, or Conflict With the Proposed Rule
The proposed rule would not duplicate, overlap, or conflict with
any other federal rules.
C. Executive Order 12866 (Regulatory Planning and Review): This
rule has been determined to be Significant for purposes of Executive
Order 12866 (Sept. 30, 1993).
D. Executive Order 13563 (Improving Regulation and Regulatory
Review): The USPTO has complied with Executive Order 13563 (Jan. 18,
2011). Specifically, the USPTO has, to the extent feasible and
applicable: (1) Made a reasoned determination that the benefits justify
the costs of the rule; (2) tailored the rule to impose the least burden
on society consistent with obtaining the regulatory objectives; (3)
selected a regulatory approach that maximizes net benefits; (4)
specified performance objectives; (5) identified and assessed available
alternatives; (6) provided the public with a meaningful opportunity to
participate in the regulatory process, including soliciting the views
of those likely affected prior to issuing a notice of proposed
rulemaking, and provided online access to the rulemaking docket; (7)
attempted to promote coordination, simplification, and harmonization
across government agencies and identified goals designed to promote
innovation; (8) considered approaches that reduce burdens and maintain
flexibility and freedom of choice for the public; and (9) ensured the
objectivity of scientific and technological information and processes,
to the extent applicable.
E. Executive Order 13771 (Reducing Regulation and Controlling
Regulatory Costs): This proposed rule is not expected to be subject to
the requirements of Executive Order 13771 (Jan. 30, 2017) because this
proposed rule is expected to involve a transfer payment.
F. Executive Order 13132 (Federalism): This rule does not contain
policies with federalism implications sufficient to warrant preparation
of a Federalism Assessment under Executive Order 13132 (Aug. 4, 1999).
G. Executive Order 13175 (Tribal Consultation): This rulemaking
will not: (1) Have substantial direct effects on one or more Indian
tribes; (2) impose substantial direct compliance costs on Indian tribal
governments; or (3) preempt tribal law. Therefore, a tribal summary
impact statement is not required under Executive Order 13175 (Nov. 6,
2000).
H. Executive Order 13211 (Energy Effects): This rulemaking is not a
significant energy action under Executive Order 13211 because this
rulemaking is not likely to have a significant adverse effect on the
supply, distribution, or use of energy. Therefore, a Statement of
Energy Effects is not required under Executive Order 13211 (May 18,
2001).
I. Executive Order 12988 (Civil Justice Reform): This rulemaking
meets applicable standards to minimize litigation, eliminate ambiguity,
and reduce burden as set forth in sections 3(a) and 3(b)(2) of
Executive Order 12988 (Feb. 5, 1996).
J. Executive Order 13045 (Protection of Children): This rulemaking
does not concern an environmental risk to health or safety that may
disproportionately affect children under Executive Order 13045 (Apr.
21, 1997).
K. Executive Order 12630 (Taking of Private Property): This
rulemaking will not affect a taking of private property or otherwise
have taking implications under Executive Order 12630 (Mar. 15, 1988).
L. Congressional Review Act: Under the Congressional Review Act
provisions of the Small Business Regulatory Enforcement Fairness Act of
1996 (5 U.S.C. 801 et seq.), prior to issuing any final rule, the USPTO
will submit a report containing the final rule and other required
information to the United States Senate, the United States House of
Representatives, and the comptroller general of the Government
Accountability Office. The changes in this rulemaking are not expected
to result in an annual effect on the economy of $100 million or more, a
major increase in costs or prices, or significant adverse effects on
competition, employment, investment, productivity, innovation, or the
ability of United States-based enterprises to compete with foreign-
based enterprises in domestic and export markets. Therefore, this
rulemaking is not expected to result in a ``major rule'' as defined in
5 U.S.C. 804(2).
M. Unfunded Mandates Reform Act of 1995: The changes set forth in
this rulemaking do not involve a Federal intergovernmental mandate that
will result in the expenditure by State, local, and tribal governments,
in the aggregate, of $100 million (as adjusted) or more in any one
year, or a Federal private sector mandate that will result in the
expenditure by the private sector of $100 million (as adjusted) or more
in any one year, and will not significantly or uniquely affect small
governments. Therefore, no actions are necessary under the provisions
of the Unfunded Mandates Reform Act of 1995. See 2 U.S.C. 1501 et seq.
N. National Environmental Policy Act: This rulemaking will not have
any effect on the quality of the environment and is thus categorically
excluded from review under the National Environmental Policy Act of
1969. See 42 U.S.C. 4321 et seq.
O. National Technology Transfer and Advancement Act: The
requirements of section 12(d) of the National Technology Transfer and
Advancement Act of 1995 (15 U.S.C. 272 note) are not applicable because
this rulemaking does not contain provisions that involve the use of
technical standards.
P. Paperwork Reduction Act: This rule involves information
collection requirements that are subject to review and approval by OMB
under the
[[Page 37054]]
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). The
collections of information involved with this proposed rule have been
reviewed and previously approved by OMB under OMB control numbers 0651-
0009, 0651-0027, 0651-0028, 0651-0040, 0651-0050, 0651-0051, 0651-0054,
0651-0055, 0651-0056, and 0651-0061. This action proposes to set or
increase certain trademark fees, which would increase the annual non-
hour cost burdens $42,483,850, as set out in the following table:
----------------------------------------------------------------------------------------------------------------
Estimated increase
in cost burdens
OMB control No. Information collection title (fees) due to
proposed rule
----------------------------------------------------------------------------------------------------------------
0651-0009........................................... Applications for Trademark $23,410,200
Registration.
0651-0040........................................... Trademark Trial and Appeal Board 4,833,700
(TTAB) Actions.
0651-0050........................................... Response to Office Action and 7,006,500
Voluntary Amendment Forms.
0651-0051........................................... Madrid Protocol....................... 325,100
0651-0054........................................... Substantive Submissions Made During 3,045,650
Prosecution of the Trademark
Application.
0651-0055........................................... Post Registration (Trademark 3,862,700
Processing).
----------------------------------------------------------------------------------------------------------------
This estimated cost burden increase is based on the currently OMB
approved response volumes associated with these information
collections, which may be slightly different than the workflow
forecasts cited in other parts of this proposed rule. In addition, any
updates to the aforementioned information collections as a result of
this proposed rulemaking will be submitted to OMB for approval prior to
the effective date of the final rule.
Comments regarding the collection of information associated with
this proposed rule, including suggestions for reducing the burden, may
be sent to the Commissioner for Trademarks, by mail to P.O. Box 1451,
Alexandria, VA 22313-1451, attention Catherine Cain; by hand delivery
to the Trademark Assistance Center, Concourse Level, James Madison
Building-East Wing, 600 Dulany Street, Alexandria, Virginia 22314,
attention Catherine Cain; or by electronic mail message via the Federal
eRulemaking Portal (https://www.regulations.gov). All comments
submitted directly to the USPTO or provided on the Federal eRulemaking
Portal should include the docket number (PTO-T-2019-0027).
Notwithstanding any other provision of law, no person is required
to respond to nor shall a person be subject to a penalty for failure to
comply with a collection of information subject to the requirements of
the Paperwork Reduction Act unless that collection of information has a
currently valid OMB control number.
List of Subjects
37 CFR Part 2
Administrative practice and procedure, Courts, Lawyers, Trademarks.
37 CFR Part 7
Administrative practice and procedure, Trademarks.
For the reasons stated in the preamble and under the authority
contained in section 10(a) of the AIA, 15 U.S.C. 1113, 1123, and 35
U.S.C. 2, as amended, the USPTO proposes to amend parts 2 and 7 of
title 37 as follows:
PART 2--RULES OF PRACTICE IN TRADEMARK CASES
0
1. The authority citation for part 2 continues to read as follows:
Authority: 15 U.S.C. 1113, 1123; 35 U.S.C. 2; sec. 10, Pub. L.
112-29, 125 Stat. 284, unless otherwise noted. Sec. 2.99 also issued
under secs. 16, 17, 60 Stat. 434; 15 U.S.C. 1066, 1067.
0
2. Amend Sec. 2.6 by:
0
a. Revising paragraphs (a)(1)(i) through (v);
0
b. Adding paragraph (a)(11)(iii);
0
c. Revising paragraphs (a)(12), (15) through (18), (22), and (23); and
0
d. Adding paragraphs (a)(24) through (26).
The revisions and additions read as follows:
Sec. 2.6 Trademark fees.
(a) * * *
(1) * * *
(i) For filing an application on paper, per class--$750.00
(ii) For filing an application under section 66(a) of the Act, per
class--$500.00
(iii) For filing a TEAS Standard application, per class--$350.00
(iv) For filing a TEAS Plus application under Sec. 2.22, per
class--$250.00
(v) Additional processing fee under Sec. 2.22(c), per class--
$100.00
* * * * *
(11) * * *.
(iii) For filing an amendment to a registration prior to submission
of an affidavit under section 8 or section 71 of the Act and consisting
only of the deletion of goods, services, and/or classes--$0.00
(12) Affidavit under section 8. (i) For filing an affidavit under
section 8 of the Act on paper, per class--$325.00
(ii) For filing an affidavit under section 8 of the Act through
TEAS, per class--$225.00
(iii) For deleting goods, services, and/or classes after submission
and prior to acceptance of an affidavit under section 8 of the Act on
paper, per class--$350.00
(iv) For deleting goods, services, and/or classes after submission
and prior to acceptance of an affidavit under section 8 of the Act
through TEAS, per class--$250.00
* * * * *
(15) Petitions to the Director. (i) For filing a petition under
Sec. 2.146 or Sec. 2.147 on paper--$350.00
(ii) For filing a petition under Sec. 2.146 or Sec. 2.147 through
TEAS--$250.00
(iii) For filing a petition under Sec. 2.66 on paper--$250.00
(iv) For filing a petition under Sec. 2.66 through TEAS--$150.00
(16) Petition to cancel. (i) For filing a petition to cancel on
paper, per class--$700.00
(ii) For filing a petition to cancel through ESTTA, per class--
$600.00
(17) Notice of opposition. (i) For filing a notice of opposition on
paper, per class--$700.00
(ii) For filing a notice of opposition through ESTTA, per class--
$600.00
(18) Ex parte appeal. (i) For filing an ex parte appeal to the
Trademark Trial and Appeal Board on paper, per class--$325.00
(ii) For filing an ex parte appeal to the Trademark Trial and
Appeal Board through ESTTA, per class--$225.00
(iii) For filing a first request for an extension of time to file
an appeal brief, per application--$0.00
(iv) For filing a second or subsequent request for an extension of
time to file an appeal brief on paper, per application--$200.00
[[Page 37055]]
(v) For filing a second or subsequent request for an extension of
time to file an appeal brief through ESTTA, per application--$100.00
(vi) For filing an appeal brief on paper, per class--$300.00
(vii) For filing an appeal brief through ESTTA, per class--$200.00
* * * * *
(22) Extension of time for filing a notice of opposition under
Sec. 2.102(c)(1)(ii) or (c)(2). (i) For filing a request for an
extension of time to file a notice of opposition under Sec.
2.102(c)(1)(ii) or (c)(2) on paper--$400.00
(ii) For filing a request for an extension of time to file a notice
of opposition under Sec. 2.102(c)(1)(ii) or (c)(2) through ESTTA--
$200.00
(23) Extension of time for filing a notice of opposition under
Sec. 2.102(c)(3). (i) For filing a request for an extension of time to
file a notice of opposition under Sec. 2.102(c)(3) on paper--$500.00
(ii) For filing a request for an extension of time to file a notice
of opposition under Sec. 2.102(c)(3) through ESTTA--$400.00
(24) Oral hearing. For filing a request for an oral hearing before
the Trademark Trial and Appeal Board, per proceeding--$500.00
(25) Letter of protest. For filing a letter of protest, per subject
application--$50.00
(26) Request for reconsideration. (i) For filing a request for
reconsideration within three months after the issue date of a final
Office action through TEAS--$0.00
(ii) For filing a request for reconsideration more than three
months after and within six months of the issue date of a final Office
action, or with a petition under Sec. 2.66, on paper--$500.00
(iii) For filing a request for reconsideration more than three
months after and within six months of the issue date of a final Office
action, or with a petition under Sec. 2.66, through TEAS or ESTTA--
$400.00
* * * * *
0
3. Amend Sec. 2.114 by revising paragraph (a) to read as follows:
Sec. 2.114 Answer.
(a)(1) If no answer is filed within the time initially set, or as
later may be reset by the Board, the petition may be decided as in the
case of default. The failure to file a timely answer tolls all
deadlines, including the discovery conference, until the issue of
default is resolved.
(2) If the cancellation proceeding is based solely on abandonment
or nonuse and default judgment is entered with no appearance by the
defendant, and no filings are made other than the petition to cancel,
$200 of the petition to cancel fee may be refunded.
* * * * *
0
4. Add Sec. 2.149 before the center heading ``Certificate'' to read as
follows:
Sec. 2.149 Letters of protest against pending applications.
(a) A third party may submit, for consideration and entry in the
record of a trademark application, objective evidence relevant to the
examination of the application for a ground for refusal of registration
if the submission is made in accordance with this section.
(b) A party protesting multiple applications must file a separate
submission under this section for each application.
(c) Any submission under this section must be filed no later than
30 days after the date the application is published for opposition
under section 12(a) of the Act and Sec. 2.80 of this part. If the
subject application cannot be withdrawn from issuance of a registration
while consideration of the protest is pending, the protest may be
considered untimely.
(d)(1) If the letter of protest is filed before publication of the
subject application, the evidence must be relevant to the identified
ground(s) for refusal, such that it is appropriate for the examining
attorney to consider whether to issue a refusal or make a requirement
under the Act or this part.
(2) If the letter of protest is filed on or within 30 days after
the date of publication of the subject application, the evidence must
establish a prima facie case for refusal on the identified ground(s),
such that failure to issue a refusal or to make a requirement would
likely result in issuance of a registration in violation of the Act or
this part.
(e) Filing a submission under this section does not stay or extend
the time for filing a notice of opposition.
(f) Any submission under this section must be made in writing,
filed through TEAS, and include:
(1) The fee required by Sec. 2.6(a)(25);
(2) The serial number of the pending application that is the
subject of the protest;
(3) An itemized evidence index that does not identify the protestor
or its representatives, does not contain legal argument, and includes:
(i) An identification of the documents, or portions of documents,
being submitted as evidence. The submission may not total more than 10
items of evidence in support of a specified ground of refusal and more
than 75 total pages of evidence without a detailed and sufficient
explanation that establishes the special circumstances that necessitate
providing more than 10 items of evidence per refusal ground or more
than 75 total pages of evidence; and
(ii) A concise factual statement of the relevant ground(s) for
refusal of registration appropriate in ex parte examination that each
item identified supports; and
(4) A clear and legible copy of each item identified in the
evidence index where:
(i) Copies of third-party registrations come from the electronic
records of the Office and show the current status and title of the
registration;
(ii) Evidence from the internet includes the date the evidence was
published or accessed and the complete URL address of the website; and
(iii) Copies of printed publications identify the publication name
and date of publication.
(g) Any submission under this section may not be entered or
considered by the Office if:
(1) Any part of the submission is not in compliance with this
section;
(2) The application record shows that the examining attorney
already considered the refusal ground(s) specified in the submission;
or
(3) A provision of the Act or parts 2 or 7 of this chapter
precludes acceptance of the submission.
(h) If a submission is determined to be in compliance with this
section, only the specified ground(s) for refusal and the provided
evidence relevant to the ground(s) for refusal will be included in the
application record for consideration by the examining attorney. An
applicant need not and should not reply to the entry into the
application record of such evidence in the absence of an Office action
issuing that includes such evidence.
(i) Any determination whether to include in an application record
the ground(s) or evidence for a refusal of registration in a submission
under this section is not petitionable.
(j) A third party filing a submission under this section will not
receive any communication from the Office relating to the submission
other than acknowledgement that it has been received by the Office and
notification of whether the submission is found to be compliant or non-
compliant with this section. Communications with the third party will
not be made of record in the application. The Office will not accept
amendments to a non-compliant submission that was previously filed.
Instead, a third party who previously filed a non-compliant submission
may
[[Page 37056]]
file another submission that meets the requirements of paragraph (f) of
this section, provided the time period for filing a submission in
paragraph (c) of this section has not closed.
(k) The limited involvement of the third party ends with the filing
of the submission under this section. The third party may not directly
contact the examining attorney assigned to the application.
0
5. Revise Sec. 2.161 to read as follows:
Sec. 2.161 Requirements for a complete affidavit or declaration of
use in commerce or excusable nonuse; requirement for the submission of
additional information, exhibits, affidavits or declarations, and
specimens; and fee for deletions of goods, services, and/or classes
from a registration.
(a) Requirements for a complete affidavit or declaration. A
complete affidavit or declaration under section 8 of the Act must:
(1) Be filed by the owner within the period set forth in Sec.
2.160(a);
(2) Include a verified statement attesting to the use in commerce
or excusable nonuse of the mark within the period set forth in section
8 of the Act. This verified statement must be executed on or after the
beginning of the filing period specified in Sec. 2.160(a);
(3) Include the U.S. registration number;
(4)(i) Include the fee required by Sec. 2.6 for each class that
the affidavit or declaration covers;
(ii) If the affidavit or declaration is filed during the grace
period under section 8(a)(3) of the Act, include the grace period
surcharge per class required by Sec. 2.6;
(iii) If at least one fee is submitted for a multiple-class
registration, but the fee is insufficient to cover all the classes, and
the class(es) to which the fee(s) should be applied are not specified,
the Office will issue a notice requiring either submission of the
additional fee(s) or specification of the class(es) to which the
initial fee(s) should be applied. Additional fees may be submitted if
the requirements of Sec. 2.164 are met. If the additional fee(s) are
not submitted within the time period set out in the Office action and
the class(es) to which the original fee(s) should be applied are not
specified, the Office will presume that the fee(s) cover the classes in
ascending order, beginning with the lowest numbered class;
(5)(i) Specify the goods, services, or nature of the collective
membership organization for which the mark is in use in commerce, and/
or the goods, services, or nature of the collective membership
organization for which excusable nonuse is claimed under paragraph
(a)(6)(ii) of this section; and
(ii) Specify the goods, services, or classes being deleted from the
registration, if the affidavit or declaration covers fewer than all the
goods, services, or classes in the registration;
(6)(i) State that the registered mark is in use in commerce; or
(ii) If the registered mark is not in use in commerce on or in
connection with all the goods, services, or classes specified in the
registration, set forth the date when such use of the mark in commerce
stopped and the approximate date when such use is expected to resume;
and recite facts to show that nonuse as to those goods, services, or
classes is due to special circumstances that excuse the nonuse and is
not due to an intention to abandon the mark; and
(7) Include one specimen showing how the mark is in use in commerce
for each class in the registration, unless excusable nonuse is claimed
under paragraph (a)(6)(ii) of this section. When requested by the
Office, additional specimens must be provided. The specimen must meet
the requirements of Sec. 2.56.
(8) Additional requirements for a collective mark: In addition to
the above requirements, a complete affidavit or declaration pertaining
to a collective mark must:
(i) State that the owner is exercising legitimate control over the
use of the mark in commerce; and
(ii) If the registration issued from an application based solely on
section 44 of the Act, state the nature of the owner's control over the
use of the mark by the members in the first affidavit or declaration
filed under paragraph (a)(1) of this section.
(9) Additional requirements for a certification mark: In addition
to the above requirements, a complete affidavit or declaration
pertaining to a certification mark must:
(i) Include a copy of the certification standards specified in
Sec. 2.45(a)(4)(i)(B);
(A) Submitting certification standards for the first time. If the
registration issued from an application based solely on section 44 of
the Act, include a copy of the certification standards in the first
affidavit or declaration filed under paragraph (a)(1) of this section;
or
(B) Certification standards submitted in prior filing. If the
certification standards in use at the time of filing the affidavit or
declaration have not changed since the date they were previously
submitted to the Office, include a statement to that effect; if the
certification standards in use at the time of filing the affidavit or
declaration have changed since the date they were previously submitted
to the Office, include a copy of the revised certification standards;
(ii) State that the owner is exercising legitimate control over the
use of the mark in commerce; and
(iii) Satisfy the requirements of Sec. 2.45(a)(4)(i)(A) and (C).
(10) For requirements of a complete affidavit or declaration of use
in commerce or excusable nonuse for a registration that issued from a
section 66(a) basis application, see Sec. 7.37.
(b) Requirement for the submission of additional information,
exhibits, affidavits or declarations, and specimens. The Office may
require the owner to furnish such information, exhibits, affidavits or
declarations, and such additional specimens as may be reasonably
necessary to the proper examination of the affidavit or declaration
under section 8 of the Act or for the Office to assess and promote the
accuracy and integrity of the register.
(c) Fee for deletions of goods, services, and/or classes from a
registration. Deletions by the owner of goods, services, and/or classes
from a registration after submission and prior to acceptance of the
affidavit or declaration must be accompanied by the relevant fee in
Sec. 2.6(a)(12)(iii) or (iv).
PART 7--RULES OF PRACTICE IN FILINGS PURSUANT TO THE PROTOCOL
RELATING TO THE MADRID AGREEMENT CONCERNING THE INTERNATIONAL
REGISTRATION OF MARKS
0
6. The authority citation for 37 CFR part 7 continues to read as
follows:
Authority: 15 U.S.C. 1123, 35 U.S.C. 2, unless otherwise noted.
0
7. Amend Sec. 7.6 by revising paragraph (a)(6) read as follows:
Sec. 7.6 Schedule of U.S. process fees.
(a) * * *
(6) Affidavit under section 71. (i) For filing an affidavit under
section 71 of the Act on paper, per class--$325.00
(ii) For filing an affidavit under section 71 of the Act through
TEAS, per class--$225.00
(iii) For deleting goods, services, and/or classes after submission
and prior to acceptance of an affidavit under section 71 of the Act on
paper, per class--$350.00
(iv) For deleting goods, services, and/or classes after submission
and prior to acceptance of an affidavit under section 71 of the Act
through TEAS, per class--$250.00
* * * * *
0
8. Revise Sec. 7.37 to read as follows:
[[Page 37057]]
Sec. 7.37 Requirements for a complete affidavit or declaration of use
in commerce or excusable nonuse; requirement for the submission of
additional information, exhibits, affidavits or declarations, and
specimens; and fee for deletions of goods, services, and/or classes
from a registration.
(a) Requirements for a complete affidavit or declaration. A
complete affidavit or declaration under section 71 of the Act must:
(1) Be filed by the holder of the international registration within
the period set forth in Sec. 7.36(b);
(2) Include a verified statement attesting to the use in commerce
or excusable nonuse of the mark within the period set forth in section
71 of the Act. The verified statement must be executed on or after the
beginning of the filing period specified in Sec. 7.36(b). A person who
is properly authorized to sign on behalf of the holder is:
(i) A person with legal authority to bind the holder;
(ii) A person with firsthand knowledge of the facts and actual or
implied authority to act on behalf of the holder; or
(iii) An attorney as defined in Sec. 11.1 of this chapter who has
an actual written or verbal power of attorney or an implied power of
attorney from the holder.
(3) Include the U.S. registration number;
(4)(i) Include the fee required by Sec. 7.6 for each class that
the affidavit or declaration covers;
(ii) If the affidavit or declaration is filed during the grace
period under section 71(a)(3) of the Act, include the grace period
surcharge per class required by Sec. 7.6;
(iii) If at least one fee is submitted for a multiple-class
registration, but the fee is insufficient to cover all the classes, and
the class(es) to which the fee(s) should be applied are not specified,
the Office will issue a notice requiring either submission of the
additional fee(s) or specification of the class(es) to which the
initial fee(s) should be applied. Additional fees may be submitted if
the requirements of Sec. 7.39 are met. If the additional fee(s) are
not submitted within the time period set out in the Office action, and
the class(es) to which the original fee(s) should be applied are not
specified, the Office will presume that the fee(s) cover the classes in
ascending order, beginning with the lowest numbered class;
(5)(i) Specify the goods, services, or nature of the collective
membership organization for which the mark is in use in commerce, and/
or the goods, services, or nature of the collective membership
organization for which excusable nonuse is claimed under paragraph
(a)(6)(ii) of this section; and
(ii) Specify the goods, services, or classes being deleted from the
registration, if the affidavit or declaration covers fewer than all the
goods, services, or classes in the registration;
(6)(i) State that the registered mark is in use in commerce; or
(ii) If the registered mark is not in use in commerce on or in
connection with all the goods, services, or classes specified in the
registration, set forth the date when such use of the mark in commerce
stopped and the approximate date when such use is expected to resume;
and recite facts to show that nonuse as to those goods, services, or
classes is due to special circumstances that excuse the nonuse and is
not due to an intention to abandon the mark; and
(7) Include one specimen showing how the mark is in use in commerce
for each class in the registration, unless excusable nonuse is claimed
under paragraph (a)(6)(ii) of this section. When requested by the
Office, additional specimens must be provided. The specimen must meet
the requirements of Sec. 2.56 of this chapter.
(8) Additional requirements for a collective mark: In addition to
the above requirements, a complete affidavit or declaration pertaining
to a collective mark must:
(i) State that the holder is exercising legitimate control over the
use of the mark in commerce; and
(ii) State the nature of the holder's control over the use of the
mark by the members in the first affidavit or declaration filed under
paragraph (a)(1) of this section.
(9) Additional requirements for a certification mark: In addition
to the above requirements, a complete affidavit or declaration
pertaining to a certification mark must:
(i) Include a copy of the certification standards specified in
Sec. 2.45(a)(4)(i)(B) of this chapter;
(A) Submitting certification standards for the first time. In the
first affidavit or declaration filed under paragraph (a)(1) of this
section, include a copy of the certification standards; or
(B) Certification standards submitted in prior filing. If the
certification standards in use at the time of filing the affidavit or
declaration have not changed since the date they were previously
submitted to the Office, include a statement to that effect; if the
certification standards in use at the time of filing the affidavit or
declaration have changed since the date they were previously submitted
to the Office, include a copy of the revised certification standards;
(ii) State that the holder is exercising legitimate control over
the use of the mark in commerce; and
(iii) Satisfy the requirements of Sec. 2.45(a)(4)(i)(A) and (C) of
this chapter.
(b) Requirement for the submission of additional information,
exhibits, affidavits or declarations, and specimens. The Office may
require the holder to furnish such information, exhibits, affidavits or
declarations, and such additional specimens as may be reasonably
necessary to the proper examination of the affidavit or declaration
under section 71 of the Act or for the Office to assess and promote the
accuracy and integrity of the register.
(c) Fee for deletions of goods, services, and/or classes from a
registration. Deletions by the holder of goods, services, and/or
classes from a registration after submission and prior to acceptance of
the affidavit or declaration must be accompanied by the relevant fee in
Sec. 7.6(a)(6)(iii) or (iv).
Dated: June 12, 2020.
Andrei Iancu,
Under Secretary of Commerce for Intellectual Property and Director of
the United States Patent and Trademark Office.
[FR Doc. 2020-13262 Filed 6-18-20; 8:45 am]
BILLING CODE 3510-16-P