This morning, the USPTO provided official notice that Practitioner Registration No. 70,549 has been assigned and Robert Kent of Houston is now a patent agent. The PTO rolls have been steadily growing for the past 15 years – with about 10,000 new practitioners registering every 4-6 years. That rate is roughly triple of what it was throughout the 1980s and mid-1990s.
The chart below shows the number of currently registered US Patent Practitioners grouped by the number of years that they have been registered. The “baby boom” of patent practitioners that began 15 years ago will likely have some important impacts on career opportunities for patent attorneys who want to move into a senior or leadership role. Today, many patent practitioners with 10-15 years of experience are moving into leadership roles within their organizations.
In our newest Patently-O Patent Law Journal article, former Commissioner of Patents Robert Stoll considers and rejects the call for legislative reforms that would reduce the estoppel associated with post-grant review filings. Stoll writes:
Critics of this [estoppel] provision seek to strike reasonably-could-have-raised estoppel as applied to subsequent civil litigation. This position is mistaken, because limiting the estoppel only to issues actually raised in the post-grant review would encourage petitioner gamesmanship to the detriment of (i) the courts, whose busy dockets will be burdened with more complex and time-consuming validity questions that the petitioner reasonably could and should have raised in the post-grant review, (ii) the USPTO, whose post-grant review decisions will lose their finality with respect to the same petitioner vis-à-vis a later court challenge, and (iii) the patent owner, who will be forced to defend the validity of the same patent claim against the same petitioner in piecemeal proceedings rather than in a single forum. Post-grant review estoppel, as originally enacted, should be maintained for these and other reasons discussed in this Article.
The article is especially timely as we expect for Congress to consider several “technical amendment” proposals over the next few weeks for inclusion within an omnibus bill.
Read the article: Robert L. Stoll, Maintaining Post-Grant Review Estoppel in the America Invents Act: A Call for Legislative Restraint, 2012 Patently-O Patent Law journal 1 at /media/docs/2012/11/stoll.2012.estoppel.pdf.
In looking through the USPTO database of registered practitioners, I was surprised to see that 93 patent agents list a current affiliation with the major firm, Finnegan Henderson. That seemed to me like an unusually large number of registered patent agents within a single firm. This morning I used Google to search for the first 30 on my list and found that 26 of those are actually patent attorneys, not patent agents. It appears that many of those individuals became a registered patent agent before having passed a state bar exam and then never changed their registration status. Of those 30, I also found a handful who are no longer at the Finnegan firm but have not updated their address information to reflect their new firm. I singled-out Finnegan here simply because they employ more US patent practitioners than any other law firm. No. 2 on that list (Fish & Richardson) does not appear to do a better job of managing its attorney rolls. I looked at the FR website for ten of their listed patent agents and found that nine of them are actually attorneys. Knobbe Martens is no different. Their top litigator, Joe Re, is listed as a patent agent on the USPTO rolls.
I was already aware of this issue, but it came to a head recently as I began working on a project that considers the professional role of patent agents as compared with patent attorneys. Outside of my own navel, the issue is important for several reasons – especially as the PTO moves to align its ethics rules with those of the various state bar associations.
The current USPTO rules require that "a registered practitioner who is an attorney in good standing with the bar of the highest court of one or more States shall provide the OED Director [William Covey] with the State bar identification number associated with each membership." 17 C.F.R. 11.11. Although not express within this sentence, the normal understanding is that any substantive change such as this will be updated "within thirty days of the date of the change." Id. The rule also requires practitioners to update their contact information.
The USPTO relies heavily on state bar association ethics rulings regarding individual practitioners in its own OED decisions. In addition, the USPTO is in the process of moving toward a system that more closely aligns its ethics rules with the rules of most state bar associations. However, this link cannot be easily made unless the USPTO is apprised of the patent attorney's state bar registration. Although certainly not strong evidence, an attorney's failure to provide this information is at least minimally suggestive of a desire to keep the various regulatory bodies from talking with one another about particular persons of interest. In reality, the failure to switch from agent to attorney is likely only an oversight in the vast majority of situations.
What to do: You can check your own registration status by searching on the USPTO website here: https://oedci.uspto.gov/OEDCI/. The process of making this change is quite easy, but it does require $100 to the USPTO and likely some money to the appropriate state bar to obtain a Certificate of Good Standing. http://www.uspto.gov/ip/boards/oed/practitioner/changeinfo.jsp.
Around 5,200 utility patents issued on November 6, 2012. I was surprised to find that at least 76 of those had been abandoned at some point during prosecution and later revived and then patent. Although only about 1.5% of the patents, the number is still surprising. Of course, revival has become somewhat regularlized these days and is done with little consequence beyond a substantial fee ($1,890 plus any late fees) and loss of some PTA. In fact, the USPTO has created an automated computer system to grant petitions to revive so long as they are submitted and signed (electronically) by a registered patent practitioner. Further, the current thinking is that a patent cannot be later challenged for improper revival because that issue does not serve as a condition for patentability that qualifies as a defense under 35 U.S.C. § 282.
Even though my sample here is quite small, it still included many patent-industry leaders such as Fujitsu, GlaxoSmithKline, Texas Instruments, Carl Zeiss, Wi-LAN, Philips, IBM, Johnson Control, University of Texas, Illinois Tool Works, Intel, 3M, Seagate, University of Maryland, EMC, Sharp, LG, Kodak, Microsoft, FEI, etc. Each of these entities now has at least one new patent that was accidentally abandoned during the application processing and then later revived.
From my analysis of these cases, I do not perceive any attempts to game the system. Rather, the abandonments seem to be truly unintentional misses by offices and attorneys managing hundreds of cases. Luckily for the parties involved, the revival process is almost as easy as the abandonment.
I wanted to look a bit deeper into the impact of the recent decision in Exelixis, Inc. v. Kappos, Case No. 1:12cv96, 2012 U.S. Dist. LEXIS 157762 (E.D. Va. November 1, 2012).
The case stems from the patent term adjustment (PTA) provisions codified in 35 U.S.C. § 154(b). It is difficult to argue that 1952 Patent Act was well drafted. However, the rest of the Patent Act reads like a well edited prose as compared with Section 154(b). That section was added as part of the URAA (1994) and substantially amended with the AIPA (1999). The portion of Section 154(b) at issue in Exelixis is the three-year prosecution timeline guarantee found in 35 U.S.C. § 154(b)(1)(B). The provision generally (but with a few exceptions) provides one day of extra patent term for each day of pre-issuance prosecution pendency beyond the first three years, regardless of the cause of the extended pendency. One of the exceptions involve an applicant's filing of a request for continued examination (RCE). Under the prior PTO statutory interpretation, the filing of an RCE would cut-short any further 154(b)(1)(B) term adjustments. Exelixis rejects the PTO's analysis and holds instead that an RCE filing after the three-year date does not stop the PTA from running. The difference between these two calculations is shown in the generic application timeline shown below.
In its decision, the Exelixis court held that the change in interpretation mandated by the district court only impacts patents where a RCE filing occurred after the three-year mark. To get some quantitative sense of the change, I pulled up the file histories of the 5,200 utility patents issued in the first week of November 2012 (November 6, 2012).
Results: About 15% of patents in the group include a first-filed RCE following the three-year mark. Each of these patents would be eligible for at least some added patent term due to the Exelixis decision. As the table below shows, these patents already have an average PTA of 887 days. By my calculation, the Exelixis methodology would add an additional 452 days of patent term. As you might imagine, there is considerable variance amongst the affected patents.
Average PTA
Patents with first-RCE filed after three years of pendency
All Patents
Before Exelixis
887 days
450 days
Estimated After Exelixis
1,339 days
516 days
This change appears to be slightly less in overall magnitude, but additive to, the Federal Circuit's Wyeth v. Kappos decision from 2010. Importantly, in that case, the PTO did not begin using the new PTA calculation or offer guidance to patent applicants on the issue until after the Federal Circuit had confirmed the lower court decision.
The majority of US patent practitioners continue to work within traditional law firm environments. However, thousands serve as in-house counsel to innovative companies throughout the world. The following is a list of the top employers of US patent practitioners.
In a November 8, 2012 decision, the Supreme Court of Canada has ruled that Pfizer’s Viagra patent is void for failure to satisfy the disclosure requirement of § 27 of Canadian patent law. See, Canadian Patent 2,163,446. Apart from the major market impact, the case is doctrinally important in the way that the court treats the disclosure requirement as applying to the patented invention as a whole rather than focusing only on a claim-by-claim analysis.
The active ingredient in Viagra is sildenafil. However, the bulk of the patented claims are more broadly directed toward the use of classes of compounds that include sildenafil or sister compounds to treat erectile dysfunction (ED). Of course, of all of these potential and patented compounds, only sildenafil has been proven effective in treating ED. Further, the patent document does not particularly identify disclose that sildenafil is the compound that works.
The court found that the disclose was lacking because it did not particularly direct one skilled in the art to use the particularly important compound – sildenafil.
Considering the specification as a whole, the use of sildenafil and the other compounds for the treatment of ED comprise one inventive concept. Even though a skilled reader will know that, when a patent contains cascading claims, the useful claim will usually be at the end concerning an individual compound, the claims in the patent ended with two individually claimed compounds [only one of which is sildenafil]. There was no basis for a skilled person to determine which of Claim 6 and Claim 7 contained the useful compound, further testing would have been required to determine which of those two compounds was actually effective in treating ED.
. . .
Although s. 27 does not specify a remedy for insufficient disclosure, the quid pro quo underpinning the Act leads to the conclusion that deeming the patent invalid is the logical consequence of a failure to properly disclose the invention and how it works. If there is no quid — proper disclosure — then there can be no quo — exclusive monopoly rights.
The concluding line of Sir Robin Jacob’s opinion reads as follows: “I hope that the lack of integrity involved in this incident is entirely atypical of Apple.” Apart from misleading the court on several fronts, Apple had failed to comply with the notice-of-loss publication required by the court. In the underlying decision, the UK court found that Samsung’s Galaxy devices do not infringe Apple’s iPad related design right. And, because the court was sitting in its role as a European design court, the decision has Pan-European effect. Because of the loss-of-reputation that the lawsuit has caused to Samsung, the court ordered Apple to publish the a notice as follows:
On 9th July 2012 the High Court of Justice of England and Wales ruled that [Samsung’s] Galaxy Tablet Computers, namely the Galaxy Tab 10.1, Tab 8.9 and Tab 7.7 do not infringe Apple’s Community registered design No. 0000181607-0001. A copy of the full judgment of the High Court is available from [link]
That Judgment has effect throughout the European Union and was upheld by the Court of Appeal of England and Wales on 18th October 2012. A copy of the Court of Appeal’s judgment is available from [link]. There is no injunction in respect of the Community Registered Design in force anywhere in Europe.
Instead of publishing that exact notice, Apple took a much more ballsy approach and published the following notice on its website:
Samsung / Apple UK judgment
On 9th July 2012 the High Court of Justice of England and Wales ruled that Samsung Electronic (UK) Limited’s Galaxy Tablet Computer, namely the Galaxy Tab 10.1, Tab 8.9 and Tab 7.7 do not infringe Apple’s registered design No. 0000181607-0001. A copy of the full judgment of the High court is available on the following link www.bailii.org/ew/cases/EWHC/Patents/2012/1882.html.
In the ruling, the judge made several important points comparing the designs of the Apple and Samsung products:
“The extreme simplicity of the Apple design is striking. Overall it has undecorated flat surfaces with a plate of glass on the front all the way out to a very thin rim and a blank back. There is a crisp edge around the rim and a combination of curves, both at the corners and the sides. The design looks like an object the informed user would want to pick up and hold. It is an understated, smooth and simple product. It is a cool design.”
“The informed user’s overall impression of each of the Samsung Galaxy Tablets is the following. From the front they belong to the family which includes the Apple design; but the Samsung products are very thin, almost insubstantial members of that family with unusual details on the back. They do not have the same understated and extreme simplicity which is possessed by the Apple design. They are not as cool.”
That Judgment has effect throughout the European Union and was upheld by the Court of Appeal on 18 October 2012. A copy of the Court of Appeal’s judgment is available on the following link www.bailii.org/ew/cases/EWCA/Civ/2012/1339.html. There is no injunction in respect of the registered design in force anywhere in Europe.
However, in a case tried in Germany regarding the same patent, the court found that Samsung engaged in unfair competition by copying the iPad design. A U.S. jury also found Samsung guilty of infringing on Apple’s design and utility patents, awarding over one billion U.S. dollars in damages to Apple Inc. So while the U.K. court did not find Samsung guilty of infringement, other courts have recognized that in the course of creating its Galaxy tablet, Samsung wilfully copied Apple’s far more popular iPad.
Apple has now corrected its website and will be paying additional fees to Samsung.
The PTO backlog and resulting delays in prosecution is rightfully a common topic of discussion for patent applicants. However, there are also a growing number of patents being issued on a much shorter timeline through the USPTO’s prioritized examination program known as “Track 1.” Under the program, applicants pay a $4,800 fee to be advanced in the prosecution queue.
Of the 5,200 utility patents issued this week, 34 of them took the Track 1 route to patentability. On average, those patents were pending for 11 months (filing date to issue date). This compares with a 39-month average for the rest of the pack of issued patents. In this small sample, Google is the most filer with 9 of the 34 patents. Only one of the patents is owned by a foreign entity (Beijing Tang-An). About half of the patents claim priority to a prior non-provisional application.
Since the program began a little over one year ago, there have been about 6,000 Track 1 petitions. The vast majority of those have been granted or are currently under consideration with less than 5% of petitions denied.
Joy Mining Machinery v. Cincinnati Mine Machinery (Fed. Cir. 2012) (nonprecedential)
In what may well be its final decision on the best mode requirement of 35 U.S.C. §112(1), the Federal Circuit has reversed a district court judgment invalidating claim 2 of Joy MM's asserted Patent No. 6,662,932. However, the decision will provide additional legal foundation for patent applicants to keep important or sensitive information regarding their invention as a trade secret rather than including that information as part of the patent disclosure.
Here, the court confirms that the best mode requirement does not require actual disclosure of the best mode, but rather only adequate disclosure to enable one of skill in the art to practice the best mode without undue experimentation. Citing See Ajinomoto Co. v. Int'l Trade Comm'n, 597 F.3d 1267 (Fed. Cir. 2010); and Young Dental Mfg. Co. v. Q3 Special Prods., Inc., 112 F.3d 1137 (Fed. Cir. 1997).
In this case, the inventors had apparently decided that the best mechanism for its claimed drive-pin retainer was a press-fitting. However, the applicant failed to identify that particular mechanism in the specification and instead suggested welding. At the time, a press-fitting mechanism was already known to those of skill in the art as one way to construct a drive-pin retainer. As such, the federal circuit found that the failure to disclose that best mode did not qualify as an actionable concealment.
Accordingly, CMM cannot point to any clear and convincing evidence upon which a reasonable jury could rely to find that the omission of press-fitting from the written description of the '932 patent "concealed" its use as a drive pin retaining means from the public.
It is unclear to this author how "concealment" can be read into the statute. Rather, Section 112 affirmatively requires that the applicant "set forth the best mode" not simply avoid concealment. The America Invents Act of 2011 (AIA) substantially alters best mode jurisprudence. Although the statutory change leaves the requirement in place without amendment, the new law prevents any post grant action (either in court or the PTO) that would challenge a patent as invalid or unenforceable based upon failure to disclose the best mode.
In reality, this decision will not have much impact beyond putting another hole in a doctrine whose obituary has already been read.
Guest Post by Megan M. La Belle, Catholic University Columbus School of Law. Professor La Belle attended the oral argument in Already, LLC d/b/a Yums v. Nike, Inc. yesterday and was kind enough to prepare this summary for Patently-O.
Yesterday, the United States Supreme Court heard oral argument in Already, LLC d/b/a Yums v. Nike, Inc., a case involving a Nike trademark covering one of its sneaker designs. The issue before the Court is whether Nike’s covenant not to sue divested the federal court of Article III jurisdiction to decide Already’s counterclaim challenging the validity of the trademark. Although this is a trademark case, the Court’s decision is likely to impact patent law since the Federal Circuit allows patent owners to use covenants not to sue to divest courts of Article III jurisdiction over patent validity counterclaims. See Super Sack Mfg. Corp. v. Chase Packaging Corp., 57 F.3d 1054, 1059-60 (Fed. Cir. 1995).
All parties agreed at oral argument that an Article III case or controversy existed at the time Already asserted its counterclaim, but questions remain as to (1) whether Nike’s covenant not to sue moots Already’s counterclaim, and (2) who has the burden of proving that the counterclaim is moot. With respect to the first question, Already’s counsel, James Dabney, argued that the covenant not to sue did not moot Already’s claim because it didn’t cover certain future shoe designs. This argument prompted the justices to ask about broader covenants and whether those might suffice to divest the court of jurisdiction. Justice Kagan, for example, asked Mr. Dabney whether there is “any covenant that exists in the world that would make you feel secure.” In response, Mr. Dabney explained that the problem with covenants not to sue is that they allow potentially invalid trademarks to remain in force. Referring to Judge Learned Hand’s famous metaphor, Mr. Dabney said that these potentially invalid trademarks act as “scarecrows” that restrain the marketplace and cause “informational injury.” Mr. Dabney also argued that this practice of using covenants not to sue dates back only to 1995 (to the Federal Circuit’s Super Sack decision); it is a “recent, controversial practice that has never been embraced by this Court.”
Turning to the second issue, the Court asked a series of question about the burden of proof as to mootness. The justices all seemed to agree that, under Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 170 (2000), a defendant like Nike who claims that its voluntary compliance moots a case bears the formidable burden of showing that it is “absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur.” Nike’s counsel, Thomas Goldstein, did not dispute that standard during argument, but instead took the position that Nike had carried its burden by granting Already the covenant not to sue. Mr. Goldstein further argued that if Already intended to design and market shoes in the future that would not be covered by that covenant (therefore placing Already at risk of an infringement suit), then Already had to provide the court with proof of those intentions. Justice Kennedy wondered why Already should have to do this and suggested that it would give Nike an unfair advantage: “I would think that…for a competitor to demand that the other competitor tell its plans, its marketing, is, to say the least, patronizing, and probably quite injurious in and of itself.” Justice Sotomayor added that this is particularly problematic in the fashion industry where timing is so important and competitors are concerned about “beating [each other] to the punch.” In response, Mr. Goldstein suggested that this sort of information is regularly disclosed in litigation and that parties like Already can rely on protective orders to prevent the type of harm mentioned.
In addition to the parties, Assistant Solicitor Ginger Anders argued as amicus curiae on behalf of the United States in support of vacatur and remand. The United States argued that the case should be remanded for the trial court to consider the mootness question under the proper Friends of the Earth standard. The justices questioned the government about Already’s ability to challenge the trademark’s validity at the United States Patent and Trademark Office in the event Already’s court challenge is mooted. Specifically, Justice Kennedy inquired whether a party like Already, if lacking an Article III case or controversy to challenge Nike’s trademark in federal court (because of a covenant not to sue), could nevertheless challenge the trademark at the PTO and then appeal an adverse decision by the PTO in federal court. In other words, Justice Kennedy asked:
Is standing easier to show once there has been an adverse action in the administrative office? Or are we right back where we started, so once you go to the agency and you try to appeal, the court says, well, this is an Article III court, we need a case or controversy, and you’re right back where we are now?
Ms. Anders responded that, in some circumstances, the adverse decision from the PTO would create an injury-in-fact sufficient to establish Article III standing for appeal. Nike’s counsel disagreed, however, arguing that Already would not have standing to appeal even after an unsuccessful challenge at the PTO. Nike conceded this as “a point in [Already’s] favor.”
This final question about whether an adverse administrative decision makes it easier to prove Article III standing is important in the patent context as well. The America Invents Act (“AIA”) allows any person (other than the patent owner) to challenge patents at the PTO in post-grant review, including competitors, consumers, and advocacy groups who would not have Article III standing to challenge the patent in federal court under current Federal Circuit law. The AIA further provides that an adverse decision from post-grant review may be appealed directly to the Federal Circuit. However, the discussion at oral argument in Already v. Nike highlights the fact that some post-grant review proceedings may not actually be reviewable on appeal for the very reasons that Justice Kennedy suggested.
The Court is expected to issue its decision before the end of June 2013.
Exelixis, Inc. v. Mr. David Kappos (as PTO Director), Case No. 1:12cv96 (E.D. Va. November 1, 2012) Download Exelixis_and_Kappos
Judge Ellis recently sided with the patentee Exelixis in ruling that the PTO improperly under-calculated the patent term adjustment due to the patentee. The focus of the case is how the filing of a request for continued examination (RCE) impacts any eventual patent term adjustment (PTA). The judge does a nice job of clearly spelling out the holding:
In sum, the plain and unambiguous language of [35 U.S.C. § 154(b)(1)(B)] requires that the time devoted to an RCE tolls the running of the three year clock if the RCE is filed within the three year period. And, put simply, RCE's have no impact on PTA if filed after the three year deadline has passed. The PTO's arguments to the contrary are not persuasive and, accordingly, the PTO's interpretation of subparagraph (B) must be set aside as "not in accordance with law" and "in excess of [its] statutory . . . authority."
This holding further extends the scope of patent term adjustments beyond the prior enhancement identified in Wyeth v. Kappos, 591 F.3d 1364 (Fed. Cir. 2010). I am estimating that this newest change impacts about 10% of recently issued patents — particularly those whose first RCE filing was more than three years after the application's actual US filing date. Up to now, the PTO has been cutting-off further PTA beyond the RCE filing date and now those applicants are eligible to seek a greater term adjustment. In many cases, the re-adjusted PTA will extend the term by more than one year.
Client Alert Now to Avoid Malpractice: Patents issued within the past 180 days are eligible for a recalculation. However, that recalculation will likely require the filing of a lawsuit in the Eastern District of Virginia. 35 U.S.C. § 154(b)(4)(A). "An applicant dissatisfied with a determination made by the Director under paragraph (3) shall have remedy by a civil action against the Director filed in the United States District Court for the Eastern District of Virginia within 180 days after the grant of the patent." For patents issued within the past two months, the PTA can be corrected via a request for reconsideration under 37 C.F.R. 1.705(d). Attorneys should beware to not simply assume that their clients are not interested in the work associated with obtaining an adjustment. The second action point here is, moving forward, applicants should not file an RCE before the three-year date without first fully considering the major PTA implications.
Judge Ellis begins the opinion with the simple question presented:
Whether 35 U.S.C. § 154(b)(1)(B) requires that an applicant's PTA be reduced by the time attributable to an RCE, where, as here, the RCE is filed after the expiration of AIPA's guaranteed three year period.
The text of section 154(b)(1)(B) begins with the headline of a "guarantee of no more than 3-year application pendency." The section provides that, subject to some caveats:
[I]f the issue of an original patent is delayed due to the failure of the [USPTO] to issue a patent within 3 years after the actual filing date of the application in the United States, not including—(i) any time consumed by continued examination of the application requested by the applicant under section 132 (b), … the term of the patent shall be extended 1 day for each day after the end of that 3-year period until the patent is issued.
In reading the statute, Judge Ellis found that the caveat for continued examination (RCE filing) modifies only the calculation of the original three-year timeline. An RCE filing prior the three-year mark will permanently toll the running of that clock. However, once the three-year delay is reached, the statute requires a 1-for-1 patent term adjustment from the three year mark through patent issuance.
Thus, subparagraph (B) essentially describes two calculations. The first is a description of the calculation of the three year period: The three year clock beings to run on the date the application is filed and, except for three specific potential tolling events, including the filing of an RCE, the clock runs continuously until the three year period ends. In other words, the "not including" portion of subparagraph (B), followed by (i), (ii), and (iii), clearly and unambiguously modifies and pertains to the three year period and does not apply to, or refer to, the day for day PTA remedy. Subparagraph (B)'s second calculation is simply a day for day addition to the PTA for every day beyond the end of the three year clock until the patent issues.
By implication, the result here is "that once the three year clock has run, PTA is to be awarded on a day for day basis regardless of subsequent events."
Up to now, the PTO has cut-off further type-B PTA at the point of an RCE filing – regardless of whether that RCE was filed after the three-year period. In its argument to the district court, the PTO asked that deference be given for its expert-agency interpretation of the statute. See Skidmore v. Swift & Co., 323 U.S. 134 (1944). The court rejected that argument. Basically, Skidmore deference comes about when there is some amount of ambiguity or lack of clarity in the statute. Here, however, the court found this question unambiguous and thus "that Skidmore deference is unwarranted."
Moving forward and except for continuation applications and delayed PCT applications, this ruling essentially guarantees that newly issued patents will be given a term of at least 17-years from issuance. This result substantially subverts a primary goal of the 20-year-from-filing term to eliminate the applicant incentive to keep an application pending for a long period of prosecution prior to issuance.
The USPTO has not yet announced whether it will appeal to the Federal Circuit.
The average US patent issues about 3 ½ years after filing. The bulk of that time can be assigned to the initial examination queue. When USPTO officials refer to the “backlog” of patent applications awaiting examination, they are typically referring to the 600,000 or so applications that have not yet received any substantive consideration. For any given patent application, the backlog delay ends when a patent examiner issues a first action on the merits (FAOM). In the vast majority of utility applications, that first action is an initial non-final rejection of the originally filed (or preliminarily amended) claims. However, in a small percentage of cases the first action is a notice of allowance.
Based upon USPTO reports in the Official Gazette, I created the following chart considers the timeline for receiving first-actions across the various technology centers and art-units within the USPTO.
The USPTO patent examination corps is divided into a number of technology centers, and each technology center is sub-divided into one or more art units. The technology focus of each tech center is listed below.
1600 – Biotechnology and Organic Chemistry
1700 – Chemical and Materials Engineering
2100 – Computer Architecture, Software, and Information Security
2400 – Computer Networks, Multiplex communication, Video Distribution, and Security
2600 – Communications
2800 – Semiconductors, Electrical and Optical Systems and Components
2900 – Designs
3600 – Transportation, Construction, Electronic Commerce, Agriculture, National Security and License & Review
The chart above is a histogram that graphically represent the time from filing to first-action for each technology center and art unit. More particularly, it reports on the pendency of applications at FOAM for each art unit averaged over the months of June, July, and August 2012. You’ll note that only one art-unit has an average time-to-first-action of less than one year. That art unit is something of a cheat because it is the single Design Patent art unit (2900). As I have noted before, the USPTO’s examination of design patents is roughly equivalent to no substantive examination on prior art grounds. The second quickest art unit is 1660 – again a cheat because it is the unit responsible for plant patents. The slowest art unit here is 2190 (data processing). I should note that the “art unit” level that I discuss here are actually grouped by tens such that 2190 is a considered a single art unit for my purposes even though it includes art units 2192-2196.
One focus of the PTO under Director David Kappos and PTO Commissioner Peggy Focarino has been to focus on outliers within the organization and shift resources in order to bring all art units within a tighter sphere of activity. Thus, one of the PTO’s initiatives has focused on ensuring that all very old cases have received at least one office action on the merits. The PTO recently completed its second round of its COPA project (Clearing the Oldest Patent Applications 2.0). In each round, the Office has set a filing date cutoff and pushed examiners to ensure that all applications filed prior to that date had actually been examined. For COPA 2.0, the cutoff date was September 1, 2010. When the project began in at the end of September 2011 there were almost 300,000 applications filed prior to that date that had not yet received any action. At the end of the project in September 2012, there were only about 33,000 remaining in that subset of old cases.
Next time I make this chart, none of the art units should pass the 2.0 year mark for FAOM. Although not the focus of the post, the PTO offers an option for applicants to skip the queue by paying a $4,000 fee to accelerate the examination.
Guest Post by Professor Andrew W. Torrance. This post is a shortened version of Professor Torrance’s recently published article titled Beauty Fades: An Experimental Study of Federal Court Design Patent Aesthetics, Journal of Intellectual Property, Volume 19, Issue 2 (2012) available at http://ssrn.com/abstract=2156943.
Introduction
Courts are rarely asked to judge beauty. Such a subjective practice would normally be anathema to the ideal of objective legal standards. However, one area of federal law has a long tradition of explicitly requiring courts to make aesthetic decisions: the law of design. Examination of design patent law offers unique insight into how aesthetic considerations have been, and are currently, employed by courts to make legal decisions.
In the United States, patent law offers protection for inventions originating within diverse fields of endeavor. In addition to utility and plant patents, design patents represent a third category of patent rights, which are available to inventors of "any new, original and ornamental design for an article of manufacture . . . ."(35 U.S.C. §171). Since they were first made available in 1842, more than 630,000 design patents have issued in the United States. The very first design patent was issued to George Bruce in 1842 to protect a new "Type" font (U.S. Patent No. D1). Later design patents issued to protect such iconic designs as the Statue of Liberty (D11,023, granted to Auguste Bartholdi) and the Coca-Cola bottle (D48,160, granted to H. Samuelson). Over the past several years, design patents have enjoyed a resurgence in popularity, with applications to the United States Patent and Trademark Office increasing markedly (Steven L. Oberholtzer, The Basic Principles Of Intellectual Property Law 6, 2d ed. 2009).
Not unsurprisingly, many courts have interpreted U.S. design patent law to require an element of artistry. Although no such requirement was explicitly present in the original design patent statute, the Patent Act of August 29, 1842 (ch. 263, 5 Stat. 543), judicial interpretations of the ornamentality requirement often appeared to necessitate that designs possess features that were aesthetically pleasing to the human eye. In Blisscraft of Hollywood v. United Plastics Co., 294 F.2d 694, 696 (2d Cir. 1961), the court mandated that "[a patented design must] be the product of aesthetic skill and artistic conception." As recently as 1989, in dicta from Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 148, the U.S. Supreme Court echoed the view that, to be patentable, designs must be visually attractive, explaining that, "[t]o qualify for protection, a design must present an aesthetically pleasing appearance that is not dictated by function alone, and must satisfy the other criteria of patentability." Thus, the legal requirement that a design patent be "ornamental" was long interpreted to necessitate artistry or an aesthetically pleasing effect.
Roughly coincident with the creation of the Court of Appeals for the Federal Circuit ("CAFC") in 1982, design patent law doctrine appeared to change direction, as aesthetic considerations were deemphasized in deciding the validity of designs claimed in patents. This shift was decisively heralded a decade later, in Seiko Epson v. Nu-Kote International, 190 F.3d 1360, 1368 (1999), when the CAFC stated "the 'ornamental' requirement of the design statute means that the design must not be governed solely by function. . . ." So well accepted has the non-artistic interpretation of the law become that law firms now generally counsel their clients that aesthetic considerations hold little relevance for design patents. To illustrate how well accepted this principle is, consider the following statement about design patent law on page 7 of The Basic Principles of Intellectual Property Law (Second Edition, 2009), a primer of intellectual property law freely distributed to potential clients by the venerable law firm, Brinks Hofer Gilson & Lione: "There is no requirement that the design be artistic or pleasing to the eye." The trend away from aesthetic interpretations of the ornamentality requirement has brought U.S. design patent law closer to that in other jurisdictions, such as the European Union and Canada, where aesthetic considerations appear to play little role in determining the validity of design patents or registrations.
Experiment and Results
An experimental approach was used to test the hypothesis that aesthetic considerations in design patent law have, indeed, diminished over the last thirty years. All design patents from 1982 (that is, the creation of the CAFC) to 2010 in which a court made a final determination of validity or infringement were identified, and each design patent therein scored for validity and infringement. Then, in a controlled experiment, human subjects were asked to score the attractiveness of all the patented designs at issue in these cases.
The experimental results indicate that, at the beginning of the time period considered, patents claiming the least attractive designs were most likely to be found invalid, those claiming designs of intermediate attractiveness fared better in terms of validity, but were found to have been infringed relatively less often, and patents claiming the most attractive designs were most likely to be found both valid and infringed. In other words, aesthetically pleasing designs claimed in patents tended to fare better in court than did less attractive designs. However, the results also indicate that, while the attractiveness of patented designs found valid, whether infringed or not, has changed little since 1982, the average attractiveness of patented designs found invalid has risen markedly over time. In fact, in contradistinction to the situation early in the time period surveyed, the attractiveness of a design claimed in a patent has now become a poor predictor of judicial outcome. Design beauty appears to have ceased to be a useful predictor of judicial outcome in design patent litigation.
A few of the experimental results of this study are illustrated below. Complete results for all litigated design patents, by type of court (that is, all federal courts, federal district courts, and the CAFC), and litigation outcome (that is, validity, invalidity, infringement, and non-infringement) can be found in the full version the article, available as a free download at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2156943.
FIGURE 1 is a scatterplot graph that depicts the mean attractiveness of all design patents according to the year in which a court ruled on their validity or infringement. FIGURE 1 also shows the results of a linear regression of these data. The regression analysis shows very little change (y = 0.0132x – 21.511, R² = 0.0146) in the attractiveness of patented designs from 1982 to 2010.
FIGURE 2 is a scatterplot graph that depicts the mean attractiveness of all design patents found invalid by a court by year of court ruling. FIGURE 2 also shows the results of a linear regression of these data. The regression analysis shows a more substantial rise (y = 0.0495x – 93.82, R² = 0.2183) in the attractiveness of patented designs found invalid from 1982 to 2010.
Discussion
a. Overall stability in attractiveness
For most of the categories of outcome and types of courts considered there was little change in the measured attractiveness of patented designs from 1982 to 2010. These results apply to patented designs found to be (1) valid but not infringed and (2) both valid and infringed, and pertain to results from both federal district courts and the CAFC. These data show little evidence that the attractiveness of patented designs held valid (whether infringed or not) changed from 1982 to 2010 across most categories of outcome and types of court.
b. Rise in attractiveness of PATENTED designs HELD INVALID
The most striking pattern in the data involves patented designs finally found invalid by a court. The data indicate a marked rise in measured attractiveness of these patented designs from 1982 to 2010. This pattern is remarkably consistent whether considered across all federal courts (y = 0.0495x – 93.82, R² = 0.2183), in federal district courts (y = 0.0442x – 83.227, R² = 0.213), or in the CAFC (y = 0.0968x – 188.48, R² = 0.2363). These results roughly match an observed shift in design patent doctrine away from an aesthetics requirement occurring since the advent of the CAFC. From 1982 to 2010 courts became increasingly likely to find attractive patented designs invalid. By contrast, the data suggest that, during the early years of the time period studied, less aesthetically attractive patented designs were more likely to be found invalid while more aesthetically attractive patented designs were more likely to found valid. This trend away from aesthetics as a factor in invalidity is mirrored in both the doctrine and the data.
c. Policy implications
There may be policy advantages to dropping the requirement for aesthetics, chief among which may be improved consistency in making decisions about design patent validity. Judgments about attractiveness are inherently subjective, depending as they do on the personal aesthetic sensibilities of the judges who determine design patent validity. Relying, instead, on a more objective test of ornamentality, such as lack of functionality, is likely to lead to improved consistency in validity determinations, not only in court and at the USPTO, but also among design patent owners considering infringement litigation and defendants attempting to avoid such actions.
A second salutary implication for policy involves the harmonization of U.S. design patent law with standards of intellectual property law prevailing internationally. The weakening of the aesthetics requirement in its design patent law has moved the United States towards the design protection laws that predominate in most other jurisdictions, such as the European Union and Canada. Access to a similar test of design patent (or design registration) validity across jurisdictions may afford design patent owners advantages of efficiency, since determinations of validity in one jurisdiction would be more likely to hold true in others.
Conclusions
Coinciding approximately with the inception of the CAFC, design patent doctrine appears to have begun to shift away from an aesthetic interpretation of the statutory ornamentality requirement. In particular, the measured attractiveness of patented designs finally found invalid by courts has increased substantially over the last three decades. Both legal doctrine and experimental results agree that beauty appears to have faded as a requirement for design patent validity.
Andrew Torrance is a Professor at the University of Kansas School of Law, a Visiting Scholar at MIT Sloan School of Management, and a Research Fellow at the Gruter Institute.
The chart above shows the current patent application status for US utility patents grouped by patent application filing date (quarter). For applications filed in the first quarter of 2005 (almost eight years ago), about 61% of the applications have issued as patents, 34% have been abandoned, and 5% are still pending. Because examination takes time to complete, a greater percentage of more recently filed applications are still pending. The chart is helpful for some patent applicants to think about where their applications fit within the range of ordinary.
The chart itself is limited only to published applications because that is the only way to peek into the status of abandoned or still pending applications. Because of that limitation, ignored applications filed after March 2011 because many of those have not yet published. The patented data (in blue) was generated from a dataset that I created of all patents that have issued since January 2005. The abandoned and pending portion of the chart was created from a randomly-sampled subset of about 10,000 applications that were published but not yet patented during the appropriate time period. For applications claiming PCT priority, I used the US national stage filing date.
Although seemingly small, the 5% of applications that are still-pending after eight years in prosecution is concerning for a number of reasons. Most of these applications have been delayed by one or more appeals to the BPAI (now PTAB). Those patentees could have likely obtained earlier protection (with narrower scope), but the delay is often not a problem for the patentee because our generous patent-term-adjustment (PTA) scheme means that the term will keep being extended one day for each day in prosecution. For professionally prosecuted patents, the US patent term has largely reverted to one that is once-again based upon the patent issue date rather than the filing date.
Voter Verified v. Premier Election Solutions and Diebold (Fed. Cir. 2012)
On the eve of the 2012 US Presidential Election, the Federal Circuit has released its opinion affirming two Florida district court judgments that 93 of Voter Verified’s asserted patent claims are invalid and the one remaining claim is not infringed by either that the remaining are not infringed by the automated voting systems sold by Premier Election Solutions and Diebold. This result rescues the court from deciding whether injunctive relief to stop voting in Florida would be against the public interest. See eBay v. MercExchange, 547 U.S. 388 (2006)
The asserted patent was originally filed as a patent application in December of 2000 in the wake of the Bush-Gore election debacle in Florida. The patent lists two inventors, including patent attorney Anthony Provitola who prosecuted the patent and litigated the case. The basic idea of the invention is to print a paper copy of the electronically-entered vote and then using the paper copy to verify that the recorded information is correct. See RE40,449.
The decision includes two topics for discussion:
Internet postings as prior art: One prior art reference used to invalidate various claims came from an online posting available through the niche website “Risks Digest.” There was clear evidence of its posting date, however, the patentee argued that the posting did not qualify as a “printed publication” under Section 102(b) because it was not sufficiently accessible to the public interested in the art by the critical date. Rejecting that criticism, the Federal Circuit noted that proof of indexing is not a requirement. Rather, what is necessary is proof that the reference was “available to the extent that persons interested and ordinarily skilled in the subject matter or art, exercising reasonable diligence, can locate it.” (Quoting SRI v. ISS and Bruckelmyer). Applying a totality-of-the-circumstances approach, the court found that availability was proven by the facts that: the reference was available online before the critical date; the site was well known to relevant individuals (those concerned with electronic voting technologies); by the critical date the site included more than 100 electronic voting articles; users of the site consider submissions to be public disclosures; and the site includes an internal search engine that would retrieve the prior art article based on searches for “voting” or “election.”
Joint Infringement: Some of asserted method claims required action by multiple parties (including “the voter”) that could potentially be actionable under Akamai Technologies, Inc. v. Limelight Networks, Inc., 692 F.3d 1301 (Fed. Cir. 2012) (en banc). However, the appellate panel found that the patentee had waived that argument at the trial level and could not raise it on appeal even though the law has changed in the interim.
Of note, in Akamai the en banc Federal Circuit focused exclusively on indirect infringement and expressly refused to comment on whether prior panel decisions had unduly narrowed the scope of direct infringement. However, the court did vacate the panel decisions in Akamai and McKesson. Here, however, the court falls back on the still-standing precedent in the parallel decision of BMC and Muniauction to limit the scope of direct infringement liability only to cases where the accused direct infringer “either performs every step of the claimed method or exerts ‘direction or control’ over any such steps performed by others.” Since control of “the voter” would be akin to voter fraud, the court here held that no such direct control exists.
Don’t forget to Vote. Below is a photo of Obama that I posted back in 2004 when he was running for senate and voting near my home in Hyde Park (Chicago), IL.
Notes: Just to clear up any confusion from my reference to eBay above, there is no chance that the Federal Circuit would have ordered an injunction to stop the election even if the devices were infringing VV’s exclusive patent rights.
Historically about two thirds of ex parte reexaminations were filed by third-party filers. In recent years, that figure has risen so that now around 90% of ex parte reexamination requests are filed by third-parties. The America Invents Act of 2011 (AIA) made only a very limited change to the ex parte reexamination structure. The greatest change, however, came about on September 16, 2012 when the USPTO instituted a new fee regime that boosted the cost of ex parte reexaminations from $2,520 to $17,750.
In the days leading up to September 16, 2012 there was a rush to file these ex parte reexamination requests in order to beat the fee deadline. The 200 or so requests filed in the final week is equivalent to about four months of filing in more ordinary weeks. With that in mind, it is not surprising that the post-September-16 filings are at a much lower rate – about one third of the pre-implementation rate for the past seven weeks.
By new year (January 2013), any gap created by the rush to file should be dissipated. However, I don’t expect for the ex parte reexamination filings to be back to their normal pre-AIA rate because of the new high-cost of filing ex parte reexaminations and because supplemental examination is now a better alternative for the majority would-be owner-filed reexaminations. The one caveat is that the new increased expense of inter partes review may push some challengers toward the ex parte approach.
Notes
Upcoming – A review of recently filed supplemental examination requests.
If you are worried that the drop in filing post-implementation will harm the USPTO’s bottom line, don’t worry. The PTO’s CFO should see the raise in fees as a very good business move. The PTO now has two thirds less work coming-in but each bit of work receives seven times more revenue. More money for less work is never a bad thing (unless you are the customer).
By Dennis Crouch 
By Dennis Crouch 
By Dennis Crouch 