The United States Patent and Trademark Office has enacted a new program that requires some trademark registrants to go beyond the normal requirements of renewing their trademark and prove continued use of the items listed in their trademark applications. The USPTO’s audit program requires trademark registrants and their attorneys to be extra vigilant when renewing their trademarks and ensure that every item listed in a registration is actively being sold in connection with the trademark.
The permanent audit program officially launched on November 1, 2017. In just under two years since the audit program began, the USPTO found that 50% of registrants who answered had to delete at least some of their listed goods and services. Since these registrations were created before the audit program was in place, the trademark owner and the attorneys who represent them did not take as much care while filing for specific goods or services. Obtaining an attorney to manage your filings that understands this audit program is very beneficial; your counsel can help you state clearly what goods or services you provide, as well as help you avoid deleting goods in the audit later.
If Selected for an Audit, Additional Proof of Use is Required
If your mark is chosen for an audit, a USPTO specialist or staff attorney will send a “Post-Registration Office Action” which will be recorded in the registration’s file in the TSDR database. Your correspondent/attorney will also get an email notification that the audit has issued.
The audit Office Action will include the following:
The Sections 8 & 15 Combined Affidavit received on March 26, 2020, is otherwise acceptable; however, the owner/holder of the registration must comply with an audit as explained below.
Registration Selected for Audit
The USPTO is performing random audits of U.S. trademark registrations to assess and promote the accuracy and integrity of the trademark register. . . This registration has been randomly selected for audit to determine whether the mark is in use with all of the goods and/or services identified in the declaration of use submitted to maintain the registration.
The response to the audit is two-fold:
Proof of current use of the registered mark in commerce for the following goods and/or services:
(List of Goods)
(2) The following statement, verified with an affidavit or signed declaration: “The owner/holder was using the mark in commerce on or in connection with the goods and/or services identified in the registration for which use of the mark in commerce is claimed, as evidenced by the submitted proof of use, during the relevant period for filing the affidavit of use.”
The Office Action will include at least two items from the application in which you will need to provide additional proof of use, such as a photograph for products or a website for services. If you are unable to due so, that the USPTO warns that:
If your response to this Office action does not meet the requirements of the audit, or includes a request to delete any of the goods and/or services identified for the audit, and goods and/or services remain in the registration without acceptable proof of use, a second Office action will issue requiring proof of use for all remaining goods and/or services for which proof of use is not of record. Therefore, the owner/holder should delete all goods and/or services for which proof of use cannot be provided.
If the owner/holder deletes any audited goods and/or services, it may provide proof of use for all remaining goods and/or services for which proof of use is not of record to avoid a possible second Office action.
If you must delete items, the USPTO may require you to file proof that you are selling the rest of the items listed, which may be dozens of different products.
If you do not respond to the audit, your registration will be cancelled.
The response time for an audit is currently six months from the issuance of the Office Action.
Ensure You Have Active “Commercial Use” of all Goods and Services Claimed in Your Registration Before Filing a Renewal
The best advice in dealing with an audit is to work with an attorney to ensure that if you are audited, you have vetted each and every item listed in your registration before filing. Go through every clause and subclause and, if you have any doubt, discuss with your attorney whether your current sales (or recent past sales) would qualify as “use” by the USPTO.
You should liberally delete any items for which you would not be able to provide proof of use.
That being said, if you are selected for an audit, there are some ways to make it as smooth as possible. You should clearly label and describe the goods in the declaration or Office action response. Providing clear and current photos of the goods and services is the easiest way to avoid a second Office action.
You should also discuss with an attorney questions about what is (or is not) bona fide use in commerce, as the established legal definition may not be what the average trademark owner expects, and can change use drastically.
Currently, Only Renewal Filings are Subject to Audit
While the program may expand in the future, currently, the USPTO is choosing to only audit registrations for which a registrant has filed a renewal filing. However, it is extremely important that trademark owners carefully consider the validity of any statement made to the USPTO, including initial applications, proof of use filings, and renewals.