I haven’t been shy regaring my thoughts on the USPTO’s proposed trademark fee increases. Now the USPTO’s Trademark Public Advisory Committee (TPAC) has issued its report following the public hearing it held in September.

First, some background:

The following are the highlights of the TPAC report, issued on October 21, 2019, in my opinion:

  • “Since we issued last year’s Annual Report, we have learned that the Trademark financial situation is projected to change without additional revenue….Reasons for the current financial situation include pay raises not included in budget formulation requirements, as well as necessary spending on IT stabilization and  modernization efforts. TPAC has long supported the USPTO’s goal to set and adjust fees to maintain the Trademark Operating Reserve at its optimal level (corresponding to six months of trademark operating expenses). For this reason, it appears a fee adjustment is now warranted.”
    • Erik’s comment: This is scant explanation for the need for additional revenue. There is no discussion in any detail regarding what the revenue will go to, and how much projected revenue is needed, and how much projected revenue will be generated by the proposed fee increases. 
  • Application filing fees: TPAC supports the requested increases.
  • Maintenance fees: TPAC asked for more explanation of the rationale for raising renewal and maintenance fees, and suggested reducing the increase proposed for Section 8/71 affidavit filings.
  • Fees for deletion of goods/services from a registration: TPAC agrees with many of the concerns raised by commenters. TPAC would support a fee for deletion per class (rather than per item deleted), with a no-fee option for deletions made prior to an audit.
  • Fees for Reconsideration/Suspension: “TPAC shares many of these concerns [raised by commenters]. In our view, the rationale for these new fees should be to recover costs only, not to discourage these types of requests. However, the amounts of these proposed fees seem arbitrary and intended to discourage filing.” “[W]e recommend that the Office provide some estimate of unit costs for these requests and set the fees proportionally.”
  • Letters of Protest: “Although TPAC agrees that Letters of Protest can be helpful to the Office and to the public and should not be discouraged, it is also true that the USPTO incurs costs in reviewing and processing Letters of Protest. Thus, we believe charging a fee is appropriate based on a cost recovery rationale (not to discourage filing). Regarding the amount of the proposed fees, TPAC recommends that the Office provide an estimate of the average unit cost for processing Letters of Protest to support the proposed amount of the fee.”
  • TTAB Fees:
    • “TPAC recommends against raising the fees for extensions of time to oppose…”
    • “[W]e support a fee to request an oral hearing, provided the rationale is cost recovery and not to discourage such requests. As some commenters noted, oral hearings can be helpful and beneficial in many cases. However, it is also true that the TTAB incurs significant costs in conducting oral hearings and all users subsidize the few parties requesting oral hearings “Regarding appeals, we think it would be more appropriate to maintain the current fees for filing a Notice of Appeal, and only charge the proposed additional fee ($200/class) if and when the applicant files an appeal brief….”
      • Erik’s comment: I completely agree with the additional fee for filing a brief, and suggested as much in my comments.
    • “As for oral hearings in opposition and cancellation proceedings, we recommend that the Office provide that the proposed fee be charged per hearing requested, not per application. Thus, if a particular proceeding involves multiple applications and/or registrations but all would be addressed in a single oral hearing, only one fee would be charged. ”
      • Erik’s comment: A good idea!

Erik’s overall comment: Overall, there was little or no mention of the projected impact on filers. Will less applications be filed? Will fewer renewals be filed? Will small businesses be adversely impacted? I am disappointed by the lack of depth in the report.

Additionally, if cost recovery is the main indicator and focus of fees, then a lot of re-alignment could be done. Applications that get approved right away are subsidizing those that have refusals; but penalizing those applicants with additional fees would be unfair. My point is that cost allocation cannot be the only concern. Perhaps a partial refund for application’s that get approved without any Office Action would be appropriate? I was also hoping to see a discussion of where the USPTO’s costs are and how they might be impacted by better IT, and by potentially eliminating paper certificates (or charging an additional fee for them).

The lack of details regarding the need for more revenue is also startling and should not be how a public agency – or its public oversight committee – operates, especially when just last year the same body gave a positive fiscal report.

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