Draft_SOO_-_AF_Trademark_Svcs.pdf

STATEMENT OF OBJECTIVES

FOR

UNITED STATES AIR FORCE

BRAND MANAGEMENT AND EXTENSION SERVICES

23 JUL 15

1. Background: USAF Trademark Licensing History: The 2005 National Defense

Authorization Act gave the Secretary of the Air Force, and the Secretaries of the other Services, the ability to identify and register trademarks, as well as collect fees for their use. That law, codified at 10 U.S.C. §2260 , gave rise to today’s Air Force Branding and Trademark Licensing

Office. The mission of this office is to protect the Air Force Brand through, among other things, operating a licensing program that grants qualified companies limited and controlled use of our distinctive trademarks. By reviewing applications and granting licenses to select entities, we promote and enhance the Air Force Brand, thus creating value for the Airmen and the public it serves. Our primary trademarks include, but are not limited to, the USAF Symbol, the USAF

Emblem, and the trade dress and logo of the USAF Thunderbirds. Through diligent monitoring and enforcement of the manufacturing and retail use of our marks, we protect our intellectual property rights and the interests of our licensees.

Since January 2012, the Air Force has collected more than $2.2 million in licensing fees from our corporate brand, donating nearly half of that to support Air Force morale, welfare and recreation activities. For the 4 th quarter of 2014, our 200+ licensees reported sales on more than

3,000 unique SKUs and exceeded $4 million in sales of Air Force-branded products. Each year the program shows growth in the amount of salable products and generated royalties.

2. Vision: Build greater brand equity by optimizing the current licensing program to improve the brand’s standing in the marketplace; expand the visibility of the brand into new product categories, distribution channels, and geographic areas; and educate multiple audiences on the protected status of Air Force trademarks – specifically the Air Force Symbol, the Air Force

Emblem, and the Air Force Thunderbirds.

3. Goals: The primary goal of this contract is to improve the Air Force licensing program. The specific goals of this contract are to accomplish the following:

3.1. Provide timely, knowledgeable and consistent service to applicants and licensees through the resources of a Licensing Agency offering a turnkey solution.

3.2. The Air Force wants to be assured that unlicensed uses of any elements comprising the Air Force Brand are identified and tracked, infringing entities notified, and limited litigation support provided when needed to support a Department of Justice (DOJ) led case.

3.3. Track, collect and disburse all licensing fees in a timely manner, and pursue delinquent accounts.

3.4. Significantly increase the amount of royalty revenue generated by the licensing activities of the Air Force Branding and Trademark Licensing Program, without overburdening the licensee base or oversaturating the market, while simultaneously restraining operating costs.

3.5. Educating the general public and retail/manufacturing industry on the protected elements of the Air Force Brand, as well as the Air Force community on the proper use of their primary logos.

3.6. Associate the Air Force Brand with affordable, quality products that are consistent with Air Force standards.

3.7. To incentivize the production of Air Force-branded products made in compliance with the Federal Trade Commission’s “Made in the USA Standard.”

3.8. To facilitate the use of our Brand at low fee or no fee for qualified hobbyists, military veterans, and various protected/disadvantaged groups.

4. Objectives: The following section’s discussion provides additional information about the specific activities and expectations that support the Air Force’s goals.

4.1. Contract Objectives. The Air Force requires contract support for a comprehensive turn-key brand license extension service provided by a Licensing Agency.

4.1.1. The contractor shall provide licensing administration for the existing portfolio of licensees, as well as create and implement strategic plans to optimize the current branding program. Provide a comprehensive brand license extension program that includes:

a) Brand licensing analysis and assessment

b) Strategic licensing marketing

c) Licensing plan development and execution

d) Brand guide development and deployment

e) Licensee/retailer prospecting

f) License preparation and execution

g) Life-cycle license management, to include three years beyond the expiration/termination of a license agreement

h) Royalty collection and reporting

i) Product research and development guidance, to include product quality control

j) Infringement tracking and enforcement

k) Factory inspections

l) Licensee accounting auditing and Legal services

m) Marketing and public relations for licensing only

n) Retail support

4.1.2. The contractor shall execute this solution from his/her site with the Air Force retaining all concur/non-concur rights at critical touch points in the licensing process via an online licensing management solution.

4.2. Strategic Planning Objectives:

4.2.1. Review and analyze the existing intellectual properties, licensees, licensed products, and processes for optimization, developing and executing a strategic marketing and merchandising plan from the findings. The current list can be found at http://www.trademark.af.mil/licenseholders.

4.2.2. Create and execute a strategic plan to educate 1) the Air Force community on the proper use of their primary logos, 2) the general public on the protected status of Air Force trademarks, and 3) the manufacturing and retail industry stakeholders on the objective of the Air Force Branding mission.

4.2.3. Include quarterly news release for the Air Force audience on the program’s successes, milestones, initiatives, etc., to be submitted to the Contracting

Officer Representative, for release to outlets such as AF.mil, base newspapers, career field newsletters, and Air Force social media sites.

4.2.4. Include no fewer than three (3) news releases annually for public and industry audiences on the Air Force program’s successes, milestones, and initiatives, to be submitted to the Air Force licensing program manager, for release to outlets such as trade magazines and community newspapers.

4.3. Licensing Activities Objectives:

4.3.1. Prospect new, desirable partnerships with national and international companies to promote the Air Force Brand on an assortment of quality products at varying price points in a variety of distribution channels.

4.3.2. Ensure that no less than 10% of the active portfolio, or 15 licensees, whichever number is smaller, must be low-fee or no-fee licenses.

4.3.3. Ensure that no less than 20% of the active portfolio, or 25 licensees, whichever number is smaller, must be issued to US veterans, women-owned businesses, or a disadvantaged businesses as defined by the U.S. Small

Business Administration.

a) An applicant/licensee meeting the qualifications of both 4.3.2. and 4.3.3.

above can be assigned to both categories. Example: A U.S. veteran-owned business that qualifies for a low-fee or no-fee license can be counted in the totals for both 4.3.2. and 4.3.3. Any change in business status will require a re-evaluation of their eligibility for the above categories.

4.3.4. Assume responsibility of the current Air Force licensee portfolio immediately upon award of contract. The current list can be found at http://www.trademark.af.mil/licenseholders.

4.3.5. Migrate licensee data from Trademarx Online if an alternate online licensing management tool is used.

4.3.6. Research all applications received to determine compatibility with Air Force standards, making recommendations to the Air Force program manager on their findings.

a) In addition to industry standards, research must include: verification in the

System for Award Management (SAM) that neither the company nor any of its key representatives are excluded from doing business with the federal government; any history of legal action taken against the company or its key management staff; certification that manufacturing locations meet the Fair Labor Association (FLA) Workplace Standards (or equivalent) and that Air Force-branded products do not contain goods from areas listed on the Labor Department’s list of child labor/forced labor, to include the blanks on which the Air Force Brand will be affixed.

4.3.7. Avoid cobranding to the extent that it could create the confusion of endorsement or sponsorship.

4.3.8. Prepare all necessary documents to fully execute any license agreement approved by the Air Force program manager for brand management and licensing.

4.3.9. Propose license terms to applicants, making recommendations to the Air

Force program manager on the benefits or harms of accepting terms.

4.3.10. Provide guidance to licensees with regard to product research and development, as well as retail opportunities.

4.3.11. Complete the licensing process, providing the licensee-signed agreement to the Air Force program manager for counter signature.

4.3.12. Monitor the executed license for the duration of the relationship,for the sell-off period following the expiration or cancellation of a license, and for three years beyond the expiration or cancellation of a license.

http://www.trademark.af.mil/licenseholders

4.3.13. Develop an exit strategy for the conclusion of the Contractor’s relationship with the Air Force.

a) Include the return of all licensee and relevant data to the control of the Air

Force.

b) Include a timeline for royalty turnover to the Air Force, not to exceed six months beyond the termination of the life of the relationship between the

Government and the Contractor.

c) Include a plan to notify all stakeholders of exit strategy.

4.4. Compliance & Auditing Objectives:

4.4.1. Conduct regular reviews on active licenses to verify compliance with licensing terms, selecting licenses via a randomizer or at the direction of the

Air Force program manager through the government contracting officer.

a) Regular reviews must include a minimum of 10% of the active portfolio, but no fewer than 10 licensees, whichever is the larger number. Status reports are required.

4.4.2. Order regular factory site inspections to verify compliance with the Standards of Manufacturing Practices, selecting factories via a randomizer or at the direction of the Air Force program manager through the government contracting officer.

a) Include no less than 5% of domestic and overseas manufacturers in the annual inspection.

b) Inspections may be outsourced to an independent third party.

c) Factory-conducted inspections will not be accepted.

4.4.3. Conduct regular inspections for product quality.

a) The Air Force agrees that there should be products produced at varying price points. The product quality shall be at least the same as the highest quality for similar goods within the product category.

4.4.4. Conduct random retail site visits to verify use of legitimate security holographic labels and hangtags.

4.5. Enforcement & Legal Services Objectives:

4.5.1. Establish and execute a program to monitor the various retail spaces for infringing products.

4.5.2. Draft education letters and, with the Air Force’s approval, other notifications related to the unauthorized use of Air Force trademarks.

4.5.3. Provide the Air Force monthly reports showing all actions taken to prevent trademark infringement, to include the steps being taken to resolve the infringement and recommendations for litigation.

4.5.4. Draft United States Patent and Trademark (USPTO) and international trademark registration applications/renewal applications for marks identified in the strategic marketing plan.

4.5.5. Provide limited litigation support to the Government in cases involving intellectual property infringement.

4.6. Product Development & Deployment Objectives:

4.6.1. Engage with applicant/licensee on compatibility of proposed product with the

Air Force strategic marketing and merchandising plan, offering guidance as needed.

4.6.2. Review all initial concepts and artwork provided by the applicant/licensee, making recommendations to the Air Force for approval/disapproval.

4.6.3. Rate all pre-production samples provided by the licensee on quality and salability, making recommendations to the Air Force for approval/disapproval.

4.6.4. Provide for the storage and disposition of physical product samples.

a) Products not returned to owners (at owner’s expense) shall be shipped to the Air Force for disposition, unless otherwise stated in writing.

4.7. Royalty Collection & Disbursements Objectives:

4.7.1. Establish and maintain a separate account for all Air Force transactions.

4.7.2. Take action to collect and properly apply all payments within 30 calendar days after the end of each calendar quarter, as well as document all actions and communications with licensees.

4.7.3. Reconcile receipts against approved expenses, submitting the remaining balance to the Air Force within 45 days after the end of each calendar quarter.

4.7.4. Develop a quarterly fee schedule detailing costs, including technology fees

(ex: software licenses for the Air Force’s San Antonio operation), commissioning fees, legal fees and auditing expenses, as well as all costs associated with an education and awareness campaign.

4.7.5. Provide timely metrics (data and/or narrative) to assess the growth and health of the program, revised/created as needed.

4.7.6. Conduct a quarterly cleanup audit to identify any delinquent payments and initiate collection activities on payments more than 180 days delinquent. The

Contractor shall retain no more than 20% of the recovered payment amount.

Progress reports are required.

4.8. IT Accessibility Objectives:

4.8.1. Contractor is expected to provide the following:

a) 24/7, secure web-based interface for the Air Force to access its accounts within the licensing management software. The Air Force program manager shall have full administrative rights to those accounts.

b) Sufficient training on the software for Air Force personnel and its authorized agents to access and query the Air Force portfolio.

c) Timely technical support for issues arising from the use of the software.

d) Multiple, concurrent user access to approximately five (5) Air Force personnel and its authorized agents.

4.8.2. Data transfer will occur annually. Files must be compatible with the Microsoft

Federal Desktop Standard software, i.e., Windows Office Products such as

Word or Excel and Adobe Acrobat.

4.9. Customer Service

4.9.1. All correspondence from applicants/licensees must have initial response and closure times as outlined below.

a) Request for licensing information: Initial response within 2 business days;

follow up within 15 business days

b) Receipt of completed application: Acknowledgement of application within

2 business days, recommendation to Air Force via the licensing management software within 5 business days, Air Force reply to

Contractor within 10 business days, initial offering/declination to applicant/licensee within 15 business days. (A 32-business day cycle from application receipt to initial license offering or declination.)

4.9.2. Provide licensees with 24-hour access to account information.

4.9.3. Develop and maintain a website that provides interested parties with information on how to apply for an Air Force license and details on the Air

Force licensing program.

a) Website must be 508 compliant.

4.10. Other Related Information

4.10.1. Meet and confer with the Air Force monthly on the status of the program.

4.10.2. Demonstrate business practices to not disparage, tarnish or dilute the trademarks or the reputation of the U.S. Air Force.

4.10.3. Receive approval by the Air Force on all documents and licensing decisions prior to implementation or acceptance.

4.10.4. Maintain comprehensive and accurate records pertaining to each licensee.

Records and related documentation are the Air Force’s property and, upon completion of this contract, will be delivered to the Air Force or its designee at the contractor’s expense. The contractor will retain data for life of contract plus 2 years and is required to make all records (electronic, paper, etc.)

available at contractor’s office or a site selected by the Air Force or its designee as requested (e.g., audit, review, etc.).

4.10.5. Comply with the Fair Labor Association’s Standards of Conduct.

4.10.6. Appear on behalf of the Air Force in various judicial proceedings (e.g., infringement cases, debt collection cases), if required.

4.10.7. Provide system security, privacy, backup, and disaster recovery for the Air

Force’s records maintained by the contractor.

4.10.8. Segregate all funds and maintain separate records pertaining to the Air Force’s portfolio. Separate accounts and reconciliations will be established and performed for all activities related to the Air Force’s portfolio.

4.10.9. Provide routine reports and metrics to the Air Force program manager for branding and trademark licensing.