USPTO UpdateFY 2021 Performance and Accountability Report
Alt Legal Team | January 13, 2022
The USPTO published its FY 2021 Performance and Accountability Report, providing a comprehensive report of the state of the USPTO. In the report, the USPTO identified one of its strategic goals: optimizing trademark quality and timeliness. The Report broke this goal into four objectives:
- Optimizing trademark application pendency
- Issuing high quality trademarks
- Fostering business effectiveness
- Enhancing operations of the TTAB
This article provides a summary of the ways in which the USPTO is working to achieve these objectives and describes the many happenings at the USPTO in the trademarks office.
Optimizing Trademark Application Pendency
The USPTO looks to pendencies as a critical indicator for stakeholders because these milestones often impact business decisions. The USPTO notes that it has taken aggressive steps to ensure optimal pendencies in light of the surge in trademark applications beginning in 2020.
The USPTO reported receiving a record 943,928 trademark application classes in FY 2021, which has had a significant impact on trademark operations at the USPTO. The USPTO identified no single reason for the surge in new applications, but cited the following factors as having an impact on the rise in applications:
- Growth of online sales during the pandemic
- Government stimuli and subsidies
- Anticipation of the USPTO’s fee increase on January 2, 2021
- Increase in entrepreneurialism
As a result of the historic rise in trademark applications, there were substantial increases in the USPTO’s trademark application pendency and other processing times. As an example, the USPTO reported first action pendency (the time between when the USPTO first receives an application and when it is first pulled for examination) was 6.3 months in FY 2021, whereas the target range is 2.5-4.5 months.
To address the delay in pendency, the USPTO implemented an aggressive strategy that includes:
- Reorganizing workloads among professional staff
- Expanding the output of the examining corps by hiring additional examining attorneys and increasing overtime
- Identifying and implementing options for streamlining work processes, including exploring the use of robotic process automation tools
- Launching a pilot program to add bandwidth with specialized contractors
The USPTO reported that even though the examining attorneys and support staff were operating at remarkable performances levels as compared with previous years, the pendency goals simply could not be met due to the extraordinary surge in new application filings. To help combat the issue, the USPTO has developed a recovery path for FY 2022 including:
- A new flexible capacity model
- Enhanced examination efficiencies that leverage artificial intelligence and robotic process automation
- An initiative to streamline and reengineer key operational processes
Issuing High Quality Trademarks
The USPTO measures trademark examination quality based on the following factors:
First action compliance rate – the total number of first actions without any substantive decision-making errors made, substantive decision-making errors missed, or substandard refusals under section 2 of the Trademark Act divided by the total number of first actions reviewed.
Final compliance rate – the total number of cases without any substantive decision-making errors divided by the total number of reviewed final actions and cases approved for publication.
Office action excellence – looks to the application’s adherence to registrability standards and the office action itself, including research, writing, legal decision-making, and evidence. It is calculated by the total number of cases in which there are no decision-making errors, the search is sufficient, and the writing and evidence for every issue raised are rated as “excellent” divided by the total number of first actions reviewed.
The USPTO was proud to share that the trademarks office routinely meets all three quality targets. First and final action compliance rates were 96.3% and 98.7%, respectively, for FY 2021. Exceptional office actions were achieved at 54.1% in FY 2021, exceeding the annual target of 50%.
The USPTO recognized that its primarily virtual training program for new examining attorneys was of significant value to achieving these goals. Additionally, the USPTO cited its continuing legal education for outside lawyers and stakeholders on relevant topics and training as a means of minimizing errors in applications. The USPTO also noted its commitment to listening to customer feedback on examination quality by hosting regular meetings and roundtables and providing a customer call center and email address for direct communication.
Fostering Business Effectiveness
The USPTO outlined a number of ways in which it aims to foster business effectiveness:
Renewed focus on IT modernization to enhance operations
To accommodate the surge in trademark applications, the legacy trademarks system must be updated. In FY 2021, the Trademarks IT delivery infrastructure was modernized to improve the delivery of software into production. Specific examples of these improvements include establishing development, security, and operations (DevSecOps) pipelines and parallel “blue/green” environments for over 90% of the Trademarks Product Line.
Using business intelligence and data analytics to guide decisions
The USPTO expanded its staff of trademarks business intelligence analysts to include those with expertise in artificial intelligence and machine learning. It hopes that this will help address the growing challenges of the volume of applications received, suspicious and fraudulent applications, maintenance of the overall integrity of the register, and efforts to anticipate the needs of applicants and registrants more effectively.
Protecting the integrity of the register
The USPTO made considerable strides in protecting the integrity of the Trademark Register, specifically aiming to identify suspicious trademark application and registration maintenance filings, in FY 2021 through statutory, technological, and operational adjustments.
- Deletion fee – In January 2021, the USPTO implemented a deletion fee that is required to be paid each time a registrant deletes goods or services from the registration. The fee is designed to disincentivize inaccurate claims of use in maintenance submissions.
- Letter of Protest – The USPTO expanded the letter of protest procedure to allow third parties to submit relevant evidence in a pending application showing that the mark is not in actual use in commerce.
- Address verification – The U.S. counsel rule requires every foreign domiciliary to be represented before the USPTO by a U.S. licensed attorney. To evaluate whether the rule is invoked, each applicant or registrant must provide a domicile address.
Implementation of the TMA
The TMA, enacted on December 27, 2021 provides the trademark community with new tools for removing unused registered trademarks from the federal Trademark Register, including expungement and reexamination, and gives the USPTO the ability to move applications through the system more efficiently.
Improving the customer experience
The USPTO redesigned its website to improve accessibility and ease of use for customers new to trademarks and without legal expertise, such as entrepreneurs and small business owners with the Trademarks Basics and Inventor and entrepreneur resources pages. Additionally, the USPTO launched new surveys and educational events, allowing the USPTO to understand the customer experience better and to evaluate the quality of trademarks services throughout more of the customer journey.
Launching Trademark Basics Boot Camp
The USPTO created the Trademark Basics Boot Camp, a virtual eight-module series designed for aspiring trademark applicants, from small business owners and startups to entrepreneurs and craftspeople. The purpose of the program is to help build a new generation of knowledgeable trademark owners. When trademark owners are more educated about trademarks, this improves application quality, decreases the burden on the USPTO operations, and increases examination efficiency.
Expanding pro bono legal services through law school clinics
The Law School Clinic Certification Program worked to provide economic relief to those impacted by COVID-19 and those in underrepresented groups and communities. Additionally, the USPTO encouraged law schools to expand their practice before the TTAB. In 2021, 53 schools actively participated in the program, prosecuting over 653 applications.
Partnering with global peers and stakeholders
The USPTO worked in close cooperation with international partners to exchange ideas about meeting the challenges and capitalizing on opportunities that affect the global trademark community. The USPTO participated at the Trademark 5 (TM5) Midterm Meeting, comprising the world’s largest trademark offices – China, Europe, Japan, Korea, and US. At the meeting, China’s IP office (CNIPA) and the European IP Office (EUIPO) worked towards a joint proposal to review procedures and opposition. Also, CNIPA introduced a proposal on archive management practices. The TM5 offices discussed a range of ongoing projects including fraudulent solicitations, bad faith, nontraditional marks, trademark infringement, and shared experiences and lessons learned regarding recent filing trends
Enhancing operations of the TTAB
In FY 2021, the TTAB worked to enhance its operations by:
- Expanding its COVID-19 relief efforts for stakeholders – The TTAB provided relief pursuant to the CARES Act of 2020 and expedited review and issuance of ex parte appeal decisions pursuant to the COVID-19 Prioritized Trademark Examination Program. It also initiated a Conference Pilot Program for oppositions against applications examined under the COVID-19 Examination Program.
- Reducing average pendency numbers for the disposition of contested trial case motions and the issuance of final decisions on the merits in both appeals and trials – In FY 2021, the TTAB met its pendency goals in all categories (appeals, extensions to oppose, oppositions, and petitions to cancel), during each quarter, and cumulatively for the full year.
- Planning for changes necessitated by the TMA – The TTAB launched the Expedited Cancellation Pilot Program. The pilot’s objective was to explore the utility of various means for expediting cancellation proceedings challenging the registration of marks asserted to have been abandoned or not used when necessary to support registration. The pilot confirmed that TTAB proceedings provide an effective means for challenging registered marks that are not in use and that may prevent others from registering their marks, with their high default judgment rate overall and a much higher default judgment rate where the only claim is abandonment. The pilot informed the TTAB to prepare for implementation of the TMA.
- Developing new law – In FY 2021, the TTAB continued to fulfill its commitment to developing the law by issuing 39 precedential decisions on various substantive and procedural matters.
- Working to further streamline processes through the stabilization and enhancement of IT systems, prepared for the next generation of IT systems – In August 2020, the TTAB released its new TTAB Reading Room, which replaced its Electronic Freedom of Information Act website. The Reading Room provides better search capabilities for TTAB final decisions and precedential orders. Also, In FY 2021, the TTAB began work to build its new TTAB Center, which will ultimately replace its web-based electronic filing and docketing systems, ESTTA, TTABVUE, and TTABIS, with a cloud-based solution.
- Continuing to improve and enhance the overall customer experience – The TTAB maintained its commitment to engagement with its stakeholders and customers by participating in events including the Lanham Act 75th Anniversary Celebration, TMA Roundtables, the World IP Forum, ABA events, and more. Additionally, the TTAB performed outreach to law school clinics performing pro bono work.