June 2010

Likelihood of Office Action Rejections

Patent

The following table is based on the file histories of 20,000 published patent applications that have been disposed-of.

Technology Center

Non-Final Rejection

Final Rejection

Request for Continued Examination

Restriction Requirement

1600 – Biotechnology and Organic Chemistry

80%

35%

16%

54%

1700 – Chemical and Materials Engineering

87%

38%

17%

21%

2100 – Computer Architecture, Software, and Information Security

91%

46%

27%

6%

2400 – Computer Networks, Multiplex, Video Distribution, and Security

93%

47%

28%

6%

2600 – Communications

85%

33%

18%

7%

2800 – Semiconductors, Electrical and Optical Systems and Components

77%

27%

15%

18%

3600 – Transportation, Construction, Electronic Commerce, Agriculture

88%

36%

14%

19%

3700 – Mechanical Engineering, Manufacturing, Products

86%

34%

15%

18%

The following two tables provide the same information but are limited to applications that have issued and that have been abandoned respectively.

PATENTED: Technology Center

Non-Final Rejection

Final Rejection

Request for Continued Examination

Restriction Requirement

1600 – Biotechnology and Organic Chemistry

84%

34%

21%

44%

1700 – Chemical and Materials Engineering

83%

34%

20%

19%

2100 – Computer Architecture, Software, and Information Security

88%

42%

31%

7%

2400 – Computer Networks, Multiplex, Video Distribution, and Security

89%

46%

36%

6%

2600 – Communications

81%

32%

20%

7%

2800 – Semiconductors, Electrical and Optical Systems and Components

73%

23%

15%

17%

3600 – Transportation, Construction, Electronic Commerce, Agriculture

84%

32%

17%

19%

3700 – Mechanical Engineering, Manufacturing, Products

82%

31%

17%

18%

ABANDONED: Technology Center

Non-Final Rejection

Final Rejection

Request for Continued Examination

Restriction Requirement

1600 – Biotechnology and Organic Chemistry

77%

35%

12%

62%

1700 – Chemical and Materials Engineering

91%

44%

14%

24%

2100 – Computer Architecture, Software, and Information Security

98%

52%

20%

6%

2400 – Computer Networks, Multiplex, Video Distribution, and Security

96%

49%

21%

6%

2600 – Communications

93%

37%

15%

7%

2800 – Semiconductors, Electrical and Optical Systems and Components

90%

41%

12%

23%

3600 – Transportation, Construction, Electronic Commerce, Agriculture

93%

40%

10%

19%

3700 – Mechanical Engineering, Manufacturing, Products

93%

38%

11%

19%

Beating the Deadline: Timing the Responses to Non-Final Office Actions

Patent

PatentlyO060

I took a sample of 6,600 published patent applications whose prosecution files each included an initial non-final office action rejection and a response to that action that was submitted sometime between January 1, 2008 – June 10, 2010.  Based on the dates of the office action and response, I created the histogram shown above. (Note, the histogram is corrected for due-date shifts caused by weekends and holidays).  The data is an improvement on what I presented in 2008. [Link]

As the chart show, patent applicant responses are extremely deadline driven. A typical non-final office action allows three-months to respond, but that deadline can be extended for up to three more months (for a fee).  The current extension fees are $130, $490, and $1,100 for one, two, and three month extensions respectively. That fee is cut in half for qualified “small entities.”  About 2/3 of applicants respond within the original three-month deadline. An additional legal reason to meet the original three-month deadline is that it preserves potential patent term adjustment (PTA) created by patent office delays. PTA is reduced by one-day for each day of applicant delay beyond the three month date.

Hitting the Deadline: More than 26% of the responses were filed on the exact day of the three month deadline. For applicants that missed that date, 70% filed their responses within four-days of a deadline.

Compact Prosecution: One problem with long delays is that information regarding the invention, the business needs, and the prior art, and the attorney-examiner relationship all become stale in the course of three months.  Although this staleness is difficult to quantify, I did look at patent grant rate as a function of the timing of responses. In my study, I found a clear and significant negative correlation between grant rate and delay in responding to the non-final office action.  I.e., longer delays are associated with a lower grant rate. (Here, grant rate is calculated as the number of patents issued divided by sum of the number of patents issued and applications abandoned).  The chart below groups applications according to the earliest deadline met in their first OA response and reports the grant rate for each group.

PatentlyO061

Satisfied With Delay: A delay in applicant response more-likely-than-not will delay the eventual issuance of the patent.  These figures show that most applicants are not troubled by that delay. On that note, I found that applicants that claim priority to a provisional application tend to have longer delays in responding to office actions. That is not surprising since the filing of the provisional already indicates that the applicant is comfortable with delay.  As might be expected, applications relating to Biotechnology and Organic Chemistry (TC 1600) tend to have a longer delay as well.

 

When Can a Digital File be a “Product” under Section 271(g)?

Patent

Yangaroo v. Destiny Media Techmap_can_usa.jpg (E.D. Wisc. 2010)

In an interesting trans-national infringement case, Judge Griesbach awarded summary judgment of non-infringement in favor of the accused infringer. The court held that the Canadian-based defendant’s actions did not qualify as infringement under Section 271(g)’s proscription against importation-of-a-product-made-by-a-patented-process.

35 USC 271(g): Whoever without authority imports into the United States or offers to sell, sells, or uses within the United States a product which is made by a process patented in the United States shall be liable as an infringer. . .

The asserted patent claims a particular method of distributing a content file over a network. After a series of steps, recipient terminals are provided with access to the content file. The accused infringer (Destiny) distributes encrypted music files using a method that (arguably) would infringe the patent under 271(a) if it had been performed within the US. The focal-point of the 271(g) dispute here was on whether the digital music files could be considered “products” within the meaning of 271(g).

Some prior cases:

  • Bayer AG v. Housey Pharm., Inc., 340 F.3d 1367, 1371-72 (Fed. Cir. 2003) (271(g) applies only to “physical products” and does not extend to “information” produced by a patented process.).
  • NTP, Inc. v. Research In Motion, Ltd., 418 F.3d 1282 (Fed. Cir. 2005) (citing Bayer and holding that email packets sent from Canada were not “products . . . [b]ecause the ‘transmission of information,’ like the ‘production of information,’ does not entail the manufacturing of a physical product . . . .”).
  • CNET Networks, Inc. v. Etilize, Inc., 528 F. Supp. 2d 985 (N.D. Cal. 2007) (transmission of electronic catalog of product information could be a “product” within the meaning of 271(g); distinguishing NTP and Bayer as involving “services” and “information” rather than “products” and stored data).
  • Ormco Corp. v. Align Technology, Inc., 609 F. Supp. 2d 1057 (C.D. Cal. 2009) (a three dimensional digital representation of teeth transmitted to recipients in the United States was a product).

Present Decision: In Yangaroo, the court distinguished CNet and Ormco by holding that the distributed music file was not a “product” of the method because the music file was not created by the claimed process.

Notes:

  • The Defendant (Destiny) did modify the music files during its distribution process by encrypting them. The district court held that the newly encrypted files could not be considered 271(g) products because the asserted patent did not claim encryption.
  • Ted Sabety handled the defense.

When Can a Digital File be a “Product” under Section 271(g)?

Patent

Yangaroo v. Destiny Media Techmap_can_usa.jpg (E.D. Wisc. 2010)

In an interesting trans-national infringement case, Judge Griesbach awarded summary judgment of non-infringement in favor of the accused infringer. The court held that the Canadian-based defendant’s actions did not qualify as infringement under Section 271(g)’s proscription against importation-of-a-product-made-by-a-patented-process.

35 USC 271(g): Whoever without authority imports into the United States or offers to sell, sells, or uses within the United States a product which is made by a process patented in the United States shall be liable as an infringer. . .

The asserted patent claims a particular method of distributing a content file over a network. After a series of steps, recipient terminals are provided with access to the content file. The accused infringer (Destiny) distributes encrypted music files using a method that (arguably) would infringe the patent under 271(a) if it had been performed within the US. The focal-point of the 271(g) dispute here was on whether the digital music files could be considered “products” within the meaning of 271(g).

Some prior cases:

  • Bayer AG v. Housey Pharm., Inc., 340 F.3d 1367, 1371-72 (Fed. Cir. 2003) (271(g) applies only to “physical products” and does not extend to “information” produced by a patented process.).
  • NTP, Inc. v. Research In Motion, Ltd., 418 F.3d 1282 (Fed. Cir. 2005) (citing Bayer and holding that email packets sent from Canada were not “products . . . [b]ecause the ‘transmission of information,’ like the ‘production of information,’ does not entail the manufacturing of a physical product . . . .”).
  • CNET Networks, Inc. v. Etilize, Inc., 528 F. Supp. 2d 985 (N.D. Cal. 2007) (transmission of electronic catalog of product information could be a “product” within the meaning of 271(g); distinguishing NTP and Bayer as involving “services” and “information” rather than “products” and stored data).
  • Ormco Corp. v. Align Technology, Inc., 609 F. Supp. 2d 1057 (C.D. Cal. 2009) (a three dimensional digital representation of teeth transmitted to recipients in the United States was a product).

Present Decision: In Yangaroo, the court distinguished CNet and Ormco by holding that the distributed music file was not a “product” of the method because the music file was not created by the claimed process.

Notes:

  • The Defendant (Destiny) did modify the music files during its distribution process by encrypting them. The district court held that the newly encrypted files could not be considered 271(g) products because the asserted patent did not claim encryption.
  • Ted Sabety handled the defense.

False Marking: Solo Cup Properly Rebutted Presumption of Intent to Deceive

Patent

Pequignot v. Solo Cup (Fed. Cir. 2010)

Over the past year, hundreds of companies have been sued for false patent marking. The qui-tam style statute creates a cause of action against manufacturer who, with intent to deceive the public, mark unpatented products as patented. Any person may sue to collect the damages, however, half of the award goes to the Federal Government. Damage awards may be awarded up to $500 per falsely marked article.

35 USC 292(a): Whoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article the word “patent” or any word or number importing the same is patented, for the purpose of deceiving the public; or Whoever marks upon, or affixes to, or uses in advertising in connection with any article the words “patent applied for,” “patent pending,” or any word importing that an application for patent has been made, when no application for patent has been made, or if made, is not pending, for the purpose of deceiving the public – Shall be fined not more than $500 for every such offense.

Most of the pending false-marking cases have a similar factual underpinning: The product being sold is marked was covered by a patent, and the manufacturer continued to mark the products as patented even with knowledge that the patents had expired. Solo cup made two separate arguments as to why these facts are insufficient to prove false marking: (1) that a product covered by an expired patent is not “unpatented” as required by the statute; and (2) that the fact of patent expiration is insufficient to show an intent to deceive the public.

Unpatented Article: Without question, a patented article is “unpatented” once the associated patents expire.

As the district court pointed out, “[a]n article that was once protected by a now-expired patent is no different [from] an article that has never received protection from a patent. Both are in the public domain.”

The court recognized that expiry dates are often difficult to calculate:

[D]etermining the expiration date of a patent can, at times, be difficult. The date of the patent grant is shown on the first page of a patent, but its term currently also depends on the date it was filed; in 1994, the effective term of a patent changed from seventeen years commencing at issuance to twenty years from filing. Furthermore, the term depends on whether there are patent term adjustments and whether the patent owner has paid maintenance fees. Thus, as with a never-patented article, an article marked with an expired patent number imposes on the public “the cost of determining whether the involved patents are valid and enforceable.”

Solo’s products that were once covered by now-expired patents are therefore “unpatented” within the meaning of the statute.

Rebuttable Presumption of Intent to Deceive: On appeal, the Federal Circuit held that a rebuttable presumption of intent to deceive is created when a manufacturer prints expired patent numbers on its products with knowledge that the patents are expired. However, this level of evidence leaves only a “weak” the presumption of intent that can be easily rebutted.

Here, the Federal Circuit agreed that Solo Cup did indeed rebut the presumption by providing “credible evidence that its purpose was not to deceive the public.” In particular, the court held that rebuttal evidence was provided by Solo Cup’s “good faith reliance on the advice of counsel” (who said that Solo need-not remove the expired patent listing) and “out of a desire to reduce costs and business disruption.”

Holding: No violation.

This decision will put a damper on the false-marking claims. However, some defendants may not have the same advice-of-counsel excuse.

Jon Dudas New President of FIRST — the Youth Robotics Leader

Patent

JonDudasFormer PTO Director Jon Dudas has taken an interesting new job as President of the non-profit organization FIRST (For Inspiration and Recognition of Science and Technology) (www.usfirst.org). FIRST was originally founded by Dean Kamen and has the goal of helping youth find inspiration and career pathways in science, technology and engineering.

More than 200,000 students competed in FIRST robotics and technology competitions in the past year.  Kamen sees these technology initiatives as an alternative to sports. Kamen: “Not every kid wants to be a professional engineer, but they deserve the opportunity to get a taste of the world of science, engineering, technology and problem-solving. It ought to be at least as accessible to every kid as any sport. . . . Bounce, bounce, throw’ is a nice thing to get good at, but it’s not going to change security, healthcare environmental issues, or quality of life.”

Jon Dudas has been a partner at Foley & Lardner since leaving the PTO in early 2009. 

Timing of the Notice of Allowance, Issue Fee Payment, and Patent Issuance

Patent

A Patently-O reader asked a question about the timing of a patent’s issuance and whether the date of issue-fee payment affects the issue date.  i.e., whether “the patent will issue on the same day regardless of whether the issue fee is paid immediately after receiving the notice of allowance or waiting until the statutory deadline to pay.  Any thoughts?”

To answer this question, I pulled-up the file histories for 630 patents issued on June 8, 2010 and created a table comparing the respective dates of (1) the notice of allowance, (2) payment of the issue fee, and (3) issuance of the patent. I limited the sample to include only payments made within the statutory three-month window. Some file histories included multiple notices of allowance. For those, I only looked at the last-mailed notice.

Answer: As the charts shows below, the timing of issuance is closely correlated with timing of the payment of the issue fee. In my sample, 88% of the patents issued within 6–8 weeks of payment of the issue fee. Those that took longer were, for the most part, associated with older applications.  In addition, the delay was greater for applicants that waited until the deadline to pay the issue fee.

PatentLawPic1002

The second chart shows a histogram of delay from the payment of the issue fee until patent issuance. Most patents issue in the sixth-week after payment.

PatentLawPic1003

The final chart shows patent applicant delay in payment of the issue fee. The chart was created by comparing the date of issue fee payment to the three-month payment deadline. More than 50% of applicants waited until the the week of the deadline to pay their issue fee. Why the delay?

PatentLawPic1005

 

Patent Grants Remain at All-Time High

Patent

The USPTO issues patents each Tuesday morning at 12:01 am. In the past several weeks, I have reported on the rising number of patents being issued each week. The past seven-weeks rank as the top-seven weeks of all time in terms of the number of utility patents issued.

PatentlyO058

Policies and Procedures: Over the past year, the PTO has increased its weekly patent grant count by more than 30%. During that time, the PTO did not increase its budget or hire a significant number of patent examiners. The difference appears to come from two avenues: (1) changes in PTO policies and procedures that provide patent examiners more opportunity to find patentable claims and (2) changes in patent applicant behavior in favor of accepting narrower claims.

The Backlog: The rising number of grants is at least slowing the growth of the application backlog. However, it does not appear to be sufficient to actually shrink the backlog. About 8,750 utility applications are filed each week — a figure greater than the average weekly final disposals (issued patents + abandoned applications). Using the increased grant-count and a 60% allowance rate, I calculate about 7,600 such final disposals each week.  

Claim Construction Internal Consistency

Patent

PatentLawPic1001Haemonetics v. Baxter Healthcare (Fed. Cir. 2010)

This decision is important for its endorsement of the claim construction canon that the internal logic and grammar of an individual claim takes primacy over inter-claim consistency.

Haemonetics’ asserted claim was directed to: 16. A centrifugal unit comprising a centrifugal component and a plurality of tubes . . . with the centrifugal unit having a radius between 25 and 50 mm and a height between 75 and 125% of the radius.

The preamble of Claim 16 clearly indicates that the centrifugal unit includes both a centrifugal component a plurality of tubes. However, other claims and the specification indicate that the centrifugal unit did not include the tubes. 

On appeal, the Federal Circuit held that the clarity of Claim 16 controlled the term’s construction for that claim.  Regardless of its use elsewhere, in claim 16, the centrifugal unit includes the tubes.

[C]laim 16’s beginning and, in our view, controlling language could hardly be clearer. Claim 16 states: “A centrifugal unit comprising a centrifugal component and a plurality of tubes . . . .” It does not merely state the intended field of use in a preamble, as Haemonetics argues. Rather, it unambiguously defines “centrifugal unit” as “comprising” two structural components: a centrifugal component and a plurality of tubes. The claim then further recites, not the centrifugal component and not a centrifugal unit, but “the centrifugal unit” as “having a radius between 25 and 50 mm and a height between 75 and 125% of the radius.” Reading “the centrifugal unit” in the context of the dimensional limitations to refer exclusively to the vessel, as the district court did, ignores the antecedent basis for “the centrifugal unit,” and fails to give effect to the claim language “comprising a centrifugal component”.

. . .

The patentee’s inconsistent use of identical height and radius limitations for two different embodiments thus indicates that “the centrifugal unit” inthe context of the dimensional limitations must have different meanings in the context of different claims. (internal citations omitted)

The Massachusetts-based district court had reached the opposite conclusion. Based on the erroneous construction, the Federal Circuit vacated the jury verdict and remanded for a new application of the facts.

Multi-Track Examination: Enhanced Examination Timing Control Initiative

Patent,

The USPTO has published a request for comments that provides more detail on the potential multi-track examination timing initiative. (75 FR 31763). A public meeting will be held on July 20, 2010, 1:30 pm at the USPTO. Written comments must be submitted by August 20, 2010. Written comments, requests to attend the meeting, and requests to present at the meeting should all be sent to 3trackscomments@uspto.gov.

The potentially greatest impact of the proposal is directed toward applicants that claim foreign priority. In all such cases, the PTO is proposing that the office delay examination until the PTO receives a copy of the first office action and applicant reply from the foreign prosecution.

Under the initiative, for applications filed in the USPTO that are not based on a prior foreign-filed application (e.g., that do not claim foreign priority benefit), applicant would be able to: (1) Request prioritized examination (Track I); (2) for non-continuing applications, request a delay lasting up to 30 months in docketing for examination (Track III); or (3) obtain processing under the current procedure (Track II) by not requesting either (1) or (2). For applications filed in the USPTO that are based on a prior foreign-filed application, no action would be taken by the USPTO until the USPTO receives a copy of the search report, if any, and first office action from the foreign office and an appropriate reply to the foreign office action as if the foreign office action was made in the application filed in the USPTO. Following or concurrent with the submission of the foreign office action and reply, applicant may request prioritized examination or obtain processing under the current procedure.

….

While it is believed that most applicants will continue to file applications first in their national or regional office based on business needs or costs of translation, comment is also requested on whether the USPTO should anticipate a larger number of applications being filed at the USPTO first rather than an applicant’s national office. Additionally, would this filing pattern change if (as proposed in various patent law reform bills) a foreign filing date could be used as a prior art date under US law?

…

The instant proposal permits deferral of certain fees if Track III examination is requested. … [C]omments to this notice are requested on whether PTA should be limited by a request by applicant for deferred examination in the office of first filing. Similarly, comments are also requested on whether PTA should be limited if the applicant does not request accelerated examination in the office of first filing.

Prioritized Examination (Track I): For some applicants with a currently financed plan to commercialize or exploit their innovation or a need to have more timely examination results to seek additional funding, more rapid examination is necessary. While some programs are currently available to prioritize applications (e.g., the accelerated examination program and the petition to make special program), some applicants neither want to perform the search and analysis required by the accelerated examination program nor can they seek special status based on the conditions set forth in 37 CFR 1.102. For such applicants, the USPTO is proposing optional prioritized examination upon applicant’s request and payment of a cost recovery fee. A request for prioritized examination may be made in a USPTO first-filed application at any time and may be made in any other application only after receipt of a copy of the search report, if any, and first action on the merits from the intellectual property office in which the relied-upon application was filed and an appropriate reply to that action in the application filed in the USPTO. On granting of prioritized status, the application would be placed in the queue for prioritized examination.

The fee would be set at a level to provide the resources necessary to increase the work output of the USPTO so that the aggregate pendency of non-prioritized applications would not increase due to work being done on the prioritized application. The fee would also be set to recover any other additional costs associated with processing the prioritized application. For example, if work output is to be increased by hiring new examiners, then the fee for prioritized examination would include the cost of hiring and training a sufficient number of new employees to offset the production work used to examine prioritized applications. Under the USPTO’s current statutory authority, the USPTO is not permitted to discount the fee for small entity applicants. Should the USPTO’s authority to set fees be enhanced, it is anticipated that the USPTO would discount this fee for small and micro entity applicants, given the substantial fee that would need to be charged to recover all of the costs associated with the contemplated service.

The USPTO is also considering limiting the number of claims in a prioritized application to four independent and thirty total claims. In addition, the USPTO is considering requiring early publication of prioritized applications so that applications would be published shortly after a request for prioritization is granted, or eighteen months from the earliest filing date claimed, whichever is earlier.

All applications prioritized on payment of a fee, or accelerated or advanced out-of-turn under existing programs, would be placed in a single queue for examination on the merits and *31766 would be taken up out-of-turn relative to other new or amended applications. The goals for handling applications in this queue would be to provide a first Office action on the merits within four months and a final disposition within twelve months of prioritized status being granted. If this process is implemented, the USPTO anticipates that it would provide statistics on its progress in meeting these goals on its Internet Web site.

To maximize the benefit of this track, applicant should consider one or more of the following: (1) Acquiring a good knowledge of the state of the prior art to be able to file the application with a clear specification having a complete schedule of claims from the broadest that the applicant believes he is entitled in view of the state of the prior art to the narrowest that the applicant is willing to accept; (2) filing replies that are completely responsive to the prior Office action and within the reply period (shortened) set in the Office action; and (3) being prepared to conduct interviews with the examiner.

…

An applicant-controlled up to 30-month queue prior to docketing (Track III): Some applicants file an application just prior to the statutory bar date but before a commercially viable plan for exploitation of the innovation has been developed or financed. To better provide for the timing of examination that such applicants desire and to provide a similar time period to that provided internationally, the USPTO is considering permitting any applicant in an application that does not claim benefit of a prior-filed foreign application or prior non-provisional application to select, on filing or in reply to a notice to file missing parts, an applicant-controlled up to 30-month queue prior to docketing for examination. In order to avoid delays in notice to the public, any application requesting Track III must also be published as an 18- month patent application publication. An application granted this status would be placed in a queue for applicant to request examination and pay the examination fee with the surcharge (if not already paid) within thirty months of the actual filing date of the application or any relied-upon provisional application (i.e., to which benefit is claimed under 35 U.S.C. 119(e)). Failure to request examination within the 30-month period would result in abandonment of the application. The request for examination and examination fee (and surcharge) would be due on the 30-month date but could be submitted early (e.g., on filing of the application) with a request that the application remain in the pre-examination queue for a period of time (e.g., up to 30 months from filing). On expiration of the time period, the application would be placed in the queue for examination.

On receipt of the request for this queue, the USPTO would determine if the application was ready for publication as a patent application publication (except for the receipt of the examination fee) and determine if any request for nonpublication made on filing had been rescinded. If both conditions were met, the application would be placed in a queue to await a request for examination and payment of the examination fee. If the application was not ready for publication, a requirement to place the application in condition for publication would be made and, once satisfied, the application would be placed in the 30-month queue. The request for examination and payment may be made at any time during the 30-month period. If no request is made within the 30-month period, the application would be held abandoned. The examination fee and the surcharge may be paid within the 30-month period or may be submitted after a timely request for examination is filed on notice of non-payment by the USPTO, along with any required extension of time fees.

Upon receipt of the examination request and fee, the application would be placed in the queue for examination, but the receipt date of the examination request would be used as the “date in queue.” Thus, the application will be taken up for examination as if the request date was the application’s actual filing date. If applicants determine that more rapid examination is desirable, then they may request (and pay the required fee) for prioritized examination while the application is in the queue for examination.

PTA Offset: Currently, the USPTO is considering a rule to offset any positive PTA accrued in a Track III application when applicant requests that the application be examined after the aggregate average period to issue a first Office action on the merits. For example, if the aggregate average time to issue a first Office action is 20 months and applicant requests that the application be examined at month 30, the proposed PTA reduction would be 10 months beginning on the expiration of the 20-month period and ending on the date on which applicant requested examination to begin. The overlap with the aggregate average period when the USPTO would not be able to have issued a first Office action on the merits would not be treated as an offsetting reduction.

PTA Offset for Foreign Delay: Similarly, for an application in any of the three tracks that claims foreign priority, the USPTO is considering a rule to offset positive PTA accrued in the application when applicant files the required documents (that include a copy of the search report, if any, and first office action from the foreign office and an appropriate reply to the foreign office action as if the foreign office action was made in the application filed at the USPTO) after the aggregate average period to issue a first Office action on the merits. For example, if the aggregate average time to issue a first Office action is 20 months and applicant submits the required documents 30 months after the filing of the application, then the proposed PTA reduction would be 10 months beginning on the expiration of the 20-month period and ending on the date of the filing of the required documents. Thus, delays by foreign offices beyond the aggregate average time for the USPTO to issue a first Office action on the merits would be an offsetting reduction against any positive PTA accrued by the delay in issuing a first Office action while the USPTO awaits the preparation of a search report and first action by the office of first filing.

In Tracks I and II, if the U.S. application claims the benefit of a prior-filed foreign application, and the relied-upon foreign application is abandoned prior to an action on the merits being made available, applicant must notify the USPTO and request that the application be treated for examination queuing purposes as if the foreign priority claim had not been made. The USPTO is considering making the failure to notify the USPTO within three months of the abandonment in the foreign office trigger a PTA offset as the USPTO would not appreciate the need to treat the application as if first-filed in the USPTO until such notice is given. Similarly, if the office of first filing has a practice of not producing actions on the merits, applicant would need to notify the USPTO that the application should be treated for examination queuing purposes as if the foreign priority claim had not been made.

Comments on one or more of the following questions would be helpful:

  1. Should the USPTO proceed with any efforts to enhance applicant control of the timing of examination?
  2. Are the three tracks above the most important tracks for innovators?
  3. Taking into account possible efficiency concerns associated with providing too many examination tracks, should more than three tracks be provided?
  4. Do you support the USPTO creating a single queue for examination of all applications accelerated or prioritized (e.g., any application granted special status or any prioritized application under this proposal)? This would place applications made special under the “green” technology initiative, the accelerated examination procedure and this proposal in a single queue. For this question assume that a harmonized track would permit the USPTO to provide more refined and up-to-date statistics on performance within this track. This would allow users to have a good estimate on when an application would be examined if the applicant requested prioritized examination.
  5. Should an applicant who requested prioritized examination of an application prior to filing of a request for continued examination (RCE) be required to request prioritized examination and pay the required fee again on filing of an RCE? For this question assume that the fee for prioritized examination would need to be increased above the current RCE fee to make sure that sufficient resources are available to avoid pendency increases of the non-prioritized applications.
  6. Should prioritized examination be available at any time during examination or appeal to the Board of Patent Appeals and Interferences (BPAI)?
  7. Should the number of claims permitted in a prioritized application be limited? What should the limit be?
  8. Should other requirements for use of the prioritized track be considered, such as limiting the use of extensions of time?
  9. Should prioritized applications be published as patent application publications shortly after the request for prioritization is granted? How often would this option be chosen?
  10. Should the USPTO provide an applicant-controlled up to 30-month queue prior to docketing for examination as an option for non-continuing applications? How often would this option be chosen?
  11. Should eighteen-month patent application publication be required for any application in which the 30-month queue is requested?
  12. Should the patent term adjustment (PTA) offset applied to applicant-requested delay be limited to the delay beyond the aggregate USPTO pendency to a first Office action on the merits?
  13. Should the USPTO suspend prosecution of non-continuing, non-USPTO first-filed applications to await submission of the search report and first action on the merits by the foreign office and reply in USPTO format?
  14. Should the PTA accrued during a suspension of prosecution to await the foreign action and reply be offset? If so, should that offset be linked to the period beyond average current backlogs to first Office action on the merits in the traditional queue?
  15. Should a reply to the office of first filing office action, filed in the counterpart application filed at the USPTO as if it were a reply to a USPTO Office action, be required prior to USPTO examination of the counterpart application?
  16. Should the requirement to delay USPTO examination pending the provision of a copy of the search report, first action from the office of first filing and an appropriate reply to the office of first filing office action be limited to where the office of first filing has qualified as an International Searching Authority?
  17. Should the requirement to provide a copy of the search report, first action from the office of first filing and an appropriate reply to the office of first filing office action in the USPTO application be limited to where the USPTO application will be published as a patent application publication?
  18. Should there be a concern that many applicants that currently file first in another office would file first at the USPTO to avoid the delay and requirements proposed by this notice? How often would this occur?
  19. How often do applicants abandon foreign filed applications prior to an action on the merits in the foreign filed application when the foreign filed application is relied upon for foreign priority in a U.S. application? Would applicants expect to increase that number, if the three track proposal is adopted?
  20. Should the national stage of an international application that designated more than the United States be treated as a USPTO first-filed application or a non-USPTO first-filed application, or should it be treated as a continuing application?
  21. Should the USPTO offer supplemental searches by IPGOs as an optional service?
  22. Should the USPTO facilitate the supplemental search system by receiving the request for supplemental search and fee and transmitting the application and fee to the IPGO? Should the USPTO merely provide criteria for the applicant to seek supplemental searches directly from the IPGO?
  23. Would supplemental searches be more likely to be requested in certain technologies? If so, which ones and how often?
  24. Which IPGO should be expected to be in high demand for providing the service, and by how much? Does this depend on technology?
  25. Is there a range of fees that would be appropriate to charge for supplemental searches?
  26. What level of quality should be expected? Should the USPTO enter into agreements that would require quality assurances of the work performed by the other IPGO?
  27. Should the search be required to be conducted based on the U.S. prior art standards?
  28. Should the scope of the search be recorded and transmitted?
  29. What language should the search report be transmitted in?
  30. Should the search report be required in a short period after filing, e.g., within six months of filing?
  31. How best should access to the application be provided to the IPGO?
  32. How should any inequitable conduct issues be minimized in providing this service?
  33. Should the USPTO provide a time period for applicants to review and make any appropriate comments or amendments to their application after the supplemental search has been transmitted before preparing the first Office action on the merits?

Calculating Patent Term

Patent

Does anyone have a process flow-chart that they could send to me to use when determining whether an issued patent is still in force? The process includes at least:

  1. Calculate the original patent term — May be 20 years from fililing date or 17 years from issue date depending upon the timing of the application and issuance. 
  2. Calculate any term adjustment for PTO delays (PTA +).
  3. Calculate any term adjustment for regulatory approval delays (PTE).
  4. Determine whether there are any terminal disclaimers and, if so, calculate the term of the linked-to patent. 
  5. Determine whether patent term has been disclaimed for any other reason.
  6. Determine whether clams were eliminated or changed based on reexamination or reissue.
  7. Determine whether the patent has been found invalid or unenforceable by a court of law.

Thanks!

Dennis Crouch (dcrouch@patentlyo.com)

 

Patent Maintenance Fee Data

Patent

Over 30% of USPTO revenue is derived from maintenance fees that are paid by patent holders. Under the current fee structure, three post-grant maintenance fees must be paid in order to keep a patent from prematurely expiring. A large entity pays $980 3.5 years after issuance; $2,480 7.5 years after issuance; and $4,110 11.5 after issuance. If the fee is not paid then the patent will expire at the next 4, 8, or 12 year mark. This is easy-money for the USPTO because because it does not involve any agency operational budget other than the expense of actually collecting the fee.

I used the USPTO’s new maintenance-fee data to create the charts below that show historic maintenance fee payments. The first chart might be designated a “survival rate” chart. In particular, the chart shows the percent of patents whose maintenance fees were paid at each of the the four (blue), eight (red), and twelve (green) year marks.

The graph generally shows that the rate of patent maintenance fee payments has been declining for about the past year-and-a-half.

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Of the 100,000+ patents issued in 1997, fewer than 50% are still in-force.

Osenga: The PTOs Fast Track Takes Us in the Wrong Direction

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Professor Kristen Osenga (Richmond) has written a new essay for the Patently-O Patent Law Journal entitled The Patent Office’s Fast Track Will Not Take Us in the Right Direction, 2010 Patently-O Patent L.J. 89. In a 2005 article, Professor Osenga proposed a multi-tiered approach to patent examination. In her Patently-O essay, Professor Osenga explains why her suggestions are “better than the system proposed by the Patent Office.”

  • Download the Patently-O Patent Law Journal Essay: [File Attachment: Osenga.pdf (32 KB)].
  • Read Osenga’s 2005 Article titled Entrance Ramps, Tolls, and Express Lanes – Proposals for Decreasing Traffic Congestion in the Patent Office [Link].
  • On his blog “Inventive Step”, Patent Attorney Matt Osenga (Prof Osenga’s husband) provides further discussion. [Link]

Other Recent Patently-O Patent Law Journal publications:

Choose-Your-Own-Adventure: A Multi-Track Patent Examination System

Patent

ForkThe USPTO is in the midst of considering a new multi-track examination system that would offer patent applicants options to choose between fast-track “prioritized” examination, ordinary examination, and delayed examination.  It is expected that applicants choosing the fast-track will be required to pay an additional fee while applicants choosing delay will pay a reduced application fee. Small entities would continue to pay half-price regardless of their choice. [WSJ Article by Amy Schatz]

The PTO is expected to release a request for comments later this week and to hold a public meeting this summer before implementing the program in early 2011.

The 750,000 backlog of pending patent applications is tolerated largely because so many of the pending applications relate to inventions that are not urgent. Rather, companies and inventors tend to file for patent protection well before a market develops or a marketable product exists. In those situations, applicants are not upset by PTO delay because that delay saves the company from making cash expenditures.  In the short-run, the delay pushes-off potential lawyer and PTO fees. In the longer run, the delay provides an opportunity for patent applicants to cull their portfolio with either the invention or its marketability fail to be realized.  Here at the University of Missouri, for instance, the usual approach is to file a lower-cost provisional patent application that is then followed by a more-costly non-provisional application once the value of the invention is more assured — this is an approach frequently followed for US-originated inventions. 

Of course, with the current backlog, patent applicants are delayed regardless of whether they want delay. And sometimes it is important to quickly obtain patent protection — perhaps to protect an emerging market or to satisfy potential investors.  A major problem with the current system is that the backlog delays everyone and there is no easy mechanism to speed-up the process.

On this point, the Wall Street Journal Quoted Director Kappos: “Not every application needs to go at the same speed. Some need to go fast and some need to go more slowly. . . . By allowing applicants some control over the timing of examination, USPTO resources would be better aligned with the needs of innovators.  We look forward to the public’s comments on this proposal.”  In the same article, I am quoted as saying “I have some hope that the Three-Track program will be helpful.” 

The fast-track The PTO believes that many of the delayed applications will be abandoned by the applicant prior to paying the fee to re-enter the examination process. 

Several issues need to be worked-out before the program is implemented: [More to come…]

Patently-O Bits and Bytes

Patent
  • Bilski Watch: Dissenting & Concurring Opinions: In discussing the timing of Bilski v. Kappos, several commentators suggested that the delay might indicate (1) that the court will issue multiple opinions (concurrences or dissents); or (2) that the decision will be especially long. 
  • PatentLawPic999Based on the 18–previous patent decisions, neither of those suggestions hold much water. Namely, the argument-to-decision delay appears to be negatively correlated with the number of dissenting and/or concurring opinions. Likewise, the number of pages in the decision does not appear to have any correlation with the delay.
  • New Data: Google is now providing free bullk-downloading of USPTO data: http://www.google.com/googlebooks/uspto.html

Measuring the Plague of Inequitable Conduct

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In Therasense, the en banc Federal Circuit is poised to consider fundamental questions of the law of inequitable conduct.  Some members of the court have called the doctrine’s current state a “scourge” and a “plague” on the patent system because inequitable conduct is alleged in so many patent cases. 

I searched LexisNexis for federal district court and appellate decisions that mention the term “inequitable conduct” and used those results to create the time-series charts below. As the charts demonstrate, the number of decisions discussing inequitable conduct has continued to dramatically rise even after the Federal Circuit’s 1988 Kingsdown decision.

PatentLawPic996

PatentLawPic998

In his recent article, Professor Mammen analyzed the prevalence inequitable conduct by looking at federal court complaints (inter alia).  [Read Mammen’s article] I compiled his data into the following chart that shows the dramatic rise in the percentage of patent lawsuits where inequitable conduct is pled (typically in the answer as a defense to charges of patent infringement.)  Mammen article suggests that the chart below is a conservative calculation (because pleadings are difficult to find and search) and that the actual frequency of inequitable conduct allegations may reach to 60% of patent lawsuits.

PatentLawPic1000

Federal Circuit Vacancy Watch: Judge Mayer Moves to Senior Status

Patent

Chief Judge Rader: Federal Circuit Judge Randall Rader is now Chief Judge Randall Rader. Chief Judge Rader was appointed to the Court of Federal Claims by President Reagan and to the Federal Circuit by George HW Bush in 1990.  The Chief Judge position rotates at least once every seven years.

Chief Judge Mayer: Today, the court released information that Judge Haldane Mayer will be moving to senior status at the end of June 2010. Judge Mayer was Chief Judge of the Federal Circuit from 1997–2004.

Nominees: Judge Kathleen O’Malley and Edward DuMont have been nominated to fill the slots left open by Judge Schall and Chief Judge Michel.  Although both are expected to be confirmed, the Senate has not moved on either nominee.

Next Nominee: President Obama now has the opportunity to for his third nominee for the Court. 

Bilski Watch: Timing of Supreme Court Decisions

Patent

The US Patent world continues to await the Supreme Court’s decision in Bilski v. Kappos. The case was argued on November 9, 2009 — 204 days ago.  Professor Joe Miller (Lewis & Clark) looked at the timing of 18 other recent Supreme Court patent decisions and concludes: “if you feel like you’ve been waiting a long time to see the Bilski opinion, it’s because you *have* been waiting a longer time than usual.” 

The chart below is based on Prof. Miller’s data and reports the number of days elapsed from the oral argument to the release of the decision for each case.  The average delay is about 90 days (median of 77 days).  As seen in the chart, Bilski has the longest delay (and that delay continues to grow).  A decision in Bilski is expected by June 28, 2010.

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