The Patent and Trademark Office's Use of Exchange Agreements To Automate Its Trademark Operations

GAO discussed the automation of trademark operations at the Department of Commerce's Patent and Trademark Office (PTO), focusing on PTO use of non-monetary exchange agreements to obtain automated systems and the subsequent restriction of public usage of the PTO automated trademark search system. GAO stated that: (1) PTO used exchange agreements with private vendors, under which the vendors supplied the automated system and PTO agreed to give the vendors trademark information and seriously restrict the public's access to the system; (2) while PTO later eased the restrictions on public access, it agreed to collect royalties from the public to pass on to the vendors as compensation; and (3) since PTO did not treat the agreements as subject to federal procurement laws and regulations, it avoided some procurement procedures that might have resulted in a more favorable arrangement for PTO and the public. In addition, GAO stated that: (1) PTO should have treated the exchange agreements as procurements subject to the Automatic Data Processing Equipment Act; (2) PTO should attempt to expeditiously and economically acquire unrestricted use of the trademark databases it obtained through the exchange agreements; and (3) if PTO fails to ensure that future exchange agreements are to its benefit, Congress should consider withdrawing PTO authority to enter into such agreements.