The U.S. Patent and Trademark Office (USPTO) should adopt stronger fraud risk management practices to improve its trademark system, the Government Accountability Office (GAO) said in a March 14 report.
The new report also says that USPTO could do more to improve its data systems to improve the agency’s trademark prevention programs under the Trademark Modernization Act of 2020 (TMA).
The 2020 law, GAO said, created new procedures covering expungement and reexamination “that allow individuals and businesses to challenge a registered trademark on the basis that it was not used in commerce, as is normally required.”
“A successful challenge results in the trademark being removed from the register, thus making it available for potential use for the challenger or other applicants,” GAO explained.
The report found that “USPTO current data systems do not allow the agency to assess the effectiveness of current trademark fraud prevention programs and implement new technologies for identifying fraud,” stated GAO.
Additionally, the report found that “computational tools such as predictive analytics could help the USPTO identify trademark applications with false or inaccurate information more effectively.”
According to GAO, currently there may be more than one million false and inaccurate trademark registrations.
The report recommends that the “Commissioner for Trademarks should plan and conduct regular fraud risk assessments of the trademark register to determine a fraud risk profile that aligns with leading practices” in GAO’s Fraud Risk Framework, the agency said.
“Implementing leading practices from GAO’s Fraud Risk Framework would allow the USPTO to comprehensively consider fraud risks, establish more effective controls, and fully articulate a tolerable level of fraud risk while considering the costs and benefits of potential control activities,” the agency said.
The Commissioner should also work to identify and implement improvements to current data systems to strengthen trademark data analytics for stronger fraud risk management.
The USPTO concurred with all recommendations in its response to GAO.
“Taking steps to further improve trademark data systems would enable the USPTO to use advanced techniques to flag and block trademark applications and registrations with false, inaccurate, or fraudulent claims of use, and would help the agency evaluate the effectiveness of its fraud control activities,” concluded GAO.
