Patently-O Bits and Bytes

• Tom Bakos and Mark Nowotarski have posted their own inventions on the Peer-to-Patent site. You can review them and add prior art: Invention 1, a Risk Assessment Company; Invention 2, SoberTeen Driving Insurance
• I am expecting an announcement of the next PTO director on Friday (May 8). Jim Pooley is being nominated as deputy director of WIPO and is apparently out of the running for the job of PTO director. The two leading candidates thus appear to be Todd Dickinson and David Kappos.
• If Kappos is nominated, the Peer-to-Patent system (originally funded by IBM) will receive a boost.
• Speaking of WIPO, the US has proposed "comprehensive" PCT Reform "which would result in the establishment of a new Patent Cooperation Treaty, PCT II. The new treaty would serve to better facilitate workload sharing between the patent offices.
• I just looked at Prof. Margo Bagley new article on First-to-Invent published in the Berkeley Technology Law Journal. Her conclusions: "The US First-to-Invent system may be unique in the world but it offers significant benefits to small entity entrepreneurs and others." Bagley sees these benefits as primarily coming through the "robust grace period." When should FITF be adopted? "Only when such a move will provide a clear advantage for small entities by facilitating the adoption of a one-year grace period outside of the US." See The Need for Speed (and Grace).
• Bagley's short article is well received. My one quibble is that she perpetuates the idea that a desire to end interferences is a major motivation in the debate. She says "Eliminating interferences and the uncertainty associated with them appears to be a prime motivation for the FITF legislation." Lets be clear, in the US, proponents of the first to file legislation want to make it easier to invalidate patents by creating more prior art.

Comments

[Michael F. Martin]

How about easier simply to identify prior art as prior art? I think people massively underestimate the aggregate costs of the difficulty in applying 102 here and abroad.

[Malcolm Mooney]

Dennis: "Lets be clear, in the US, proponents of the first to file legislation want to make it easier to invalidate patents by creating more prior art."

No, I disagree strongly. See Mr. Martin's comment above.

[query]

Are non-derivation interferences really a big problem?

[CNN title sensationalist]

benefit "small entity entrepreneurs and others" ...
---
Ahh, thanks for enumerating the benefited ... Since small entity entrepreneurs would no more be benefited than "others" I think the enumeration is superfluous (they both groups may conceive and file freely, regardless of their designation).

Thanks for the bone anyway. At least one Prof. is trying to trick us into believing "intellectuals" give a darn about the magnanimously benefited small entities.

[Malcolm Mooney]

"Tom Bakos and Mark Nowotarski have posted their own inventions on the Peer-to-Patent site. You can review them and add prior art: Invention 1, a Risk Assessment Company; Invention 2, SoberTeen Driving Insurance"

I looked at the claim. I'm speechless. In part that's because I am gagging on my own vomit. Am I supposed to know who these inventors are?

[Malcolm Mooney]

Claim 1: We claim that we have invented and adequately described a new auto insurance product where a driver receives a 10 to 30 percent discount in premium in exchange for allowing the insurance company to monitor his or her car to determine if anyone drives it while under the influence of alcohol.

---------------

Am I reading this correctly? Somebody actually presented this claim to the PTO?

[6]

Everyone take a minute out of your day and lol at Gene.

2007/0055560

11509913

[Ron Katznelson]

Dennis: “Lets be clear, in the US, proponents of the first to file legislation want to make it easier to invalidate patents by creating more prior art.”

Well said Dennis. Cloaking the proposed changes in § 102 as directed towards eliminating 70 interferences per year out of 460,000 applications is just a smoke screen. Interference proceedings will be replaced by *no fewer* “derivation” proceedings because first inventors will be unlikely to just cede priority to first filers without attempting to discover possible derivation from their prior invention. The legal standard for proving derivation requires a showing of earlier conception by the party alleging derivation, [Brand v. Miller, 487 F.3d 862, 869 (Fed.Cir.2007) (Derivation is a question of fact. To meet the burden of proof on derivation, a claimant “must make two showings. First, he must establish *prior conception* of the claimed subject matter. Second, he must prove communication of that conception to the patentee that is sufficient to enable him to construct and successfully operate the invention.")]. Thus, *all* derivation proceedings will in fact subsume proceedings to determine the first inventor and the purported “judicial efficiency” of eliminating the substantive determination of the first to invent is mere speculative folklore lacking a legal basis.

Among the real effects of shifting to the first-to-file will be the numerical rise of 20% - 50% in new application filings with the USPTO, reduced patent quality and applicants’ substantial loss of prior art priority as quantified and detailed in a draft group letter to senators, downloadable from my letter page http://works.bepress.com/rkatznelson/58/. If you know of any company that may wish to join the signatory list in the letter, please have them contact me by using the contact information link on the right side of the letter page.

Ron Katznelson

[Ron Katznelson]

And another fact:
Based on USPTO data, 3%-5% of applicants end up filing Rule 131 affidavits swearing behind a cited reference. Under “new § 102” with the current application filing rate, at least 14,000-23,000 applicants every year will be barred at the outset from obtaining a patent, relative to those that can obtain patents under current law. Now, I recall that you all were up in arms when a smaller number of applications were implicated under the “2+1” continuations rules. Where is the outrage on First-to-File? Have you practitioners spoken to your clients about the real implications of this HARMonization shift?

Ron Katznelson

[bsn]

Mr Katznelson, that's utter nonsense. Derivation proceedings in the rest of the world are extremely rare. Why would that be any different in the USA?
And are your 14,000 - 23,000 barred applicants a subset of your 20% - 50% rise in new applications?
I can accept that you don't like FtF, but please don't use bogus figures to support your argument.

[David Boundy]

bsn -

Don't opine before you look at Dr. Katznelson's underlying data, and read his methods. The future is hard to predict, given that it's an experiment we've never run before (like global warming in say 1980). However, Dr. Katznelson has been incredibly diligent in finding all the data that can be found, and analyzing it as best it can be analyzed. His 20-50% estimate in rise of application filing rate is, if anything, a low extrapolation from the experience of other countries.

What he doesnt tell you - because it's hard to measure - is how the quality of patent applications will plummet if "new 102" is adopted. Have you ever tried to litigate a Japan-origin patent? I have, several times. It's a nightmare, because the thin, hurried disclosures make it so difficult to interpret the scope of the claims.

I can't tell you why derivation proceedings are rare in other countries. But I've been around the block enough times with enough disputes to know that the way "new 102" is drafted, it will lead to an incredibly expensive set of disputes - far more common, and far more expensive than current interferences. (The idea of a dispute where you have to prove what the other guy did, as in a derivation proceeding, instead of what each party himself did, is pretty ludicrous.)

The rewrite of section 102 is as big an economic disaster waiting to happen as the damages provisions and post grant. It means that the patent attorneys will be driving the business schedules, instead of the business needs driving the patent process. That's catastrophic,

The reason this hasn't gotten the attention it deserves is that the harm will be acutely concentrated on startups, that is, companies now existing that aren't big enough to be active in the debate, and companies that haven't been formed yet, and thus can't hire lobbyists at all.

If you are a patent attorney that represents small companies, startups, etc. you owe it to your clients to alert them to Dr. Katznelson's letter, and get them to sign on.

[Federally Circuitous]

Why does FTF necessary mean more prior art? Even under FTF, you could still have a grace period for prior art, as under current 102(b). The fact that most other countries have FTF without a grace period for prior art doesn't mean that the two concepts are conjoined.

[Ron Katznelson]

BSN:
If you can't use your real full name, at least please read my comments correctly. Did I say that derivation proceedings would not be rare? I said that there would be no fewer derivation proceedings than the *rare* number of interferences (70 out of 460,000 per year).
It is very simple, BSN:
Before FTF: 70 proceedings to determine the first inventor.
After FTF : No fewer than 70 proceedings to determine the first inventor *and* to prove derivation. Is that complicated?

Of course derivation proceedings are rare in the rest of the world, as they would be in the U.S. under FTF. My point is that under U.S. law, one would not escape the need to determine the first inventor under FTF.

Speaking of data, do you know how many derivation proceedings there are in Europe? Are they as rare as 70/460,000? Please point me to sources you rely on in your declaration that “Derivation proceedings in the rest of the world are extremely rare.” You probably have not heard of any derivation proceedings at the EPO because there are none. Read EPC Articles 138-139 to learn why. Derivation proceedings are remitted to European contracting state (disharmonized) laws and the respective state courts. This is also the case for other matters that are at the heart of “new § 102” amendments to S.515 for the sake of “harmonization”. It is ironic that Americans are asked to align U.S. patent law, which is fully harmonized across 50 states, with that which is harmonized across none.

As to “bogus figures” I bet you have not read the group letter that was linked above. It contains references to the sources and methods of these estimates. Please read it before you make your declarations. Please avoid using the word “bogus” if you cannot sustain a substantive rebuttal. If you have ALTERNATIVE numbers supported by *facts*, I would be interested in seeing them so that I may replace the facts I use.

[Ron Katznelson]

To Federally Circuitous:
You have made an important point, which our letter also makes: The Section 102 rewrite is not merely a surgical amendment of 102(g) to resolve interferences. It is a sledgehammer redefinition of prior art. Dennis' comment here is apt: “Lets be clear, in the US, proponents of the first to file legislation want to make it easier to invalidate patents by creating more prior art.” However, there is more than just the one-year grace period. My study of over 1000 priority applications shows that at least 13% of applications are filed more than one year after the availability of the invention disclosure and that 4% are filed more than 2 years after the disclosure. See the detailed charts in my FTC testimony linked in the letter and the discussion therein.

[MaxDrei]

A quick skim of the Bagley Paper leaves on me the impression that it is a good solid piece of work. I have a question for readers. In using FtI (+grace) to help academics, and inventors who are not familiar with the patent system, could that perhaps hinder another stakeholder, namely, those who invest in manufacturing industry within America? If there is any degree of hindrance, is that a worthwhile price to pay, for continuing with FtI (+grace).

I have in mind the relative difficulty of securing a patent clearance (FTO) in the USA, as compared with that in other countries. With the decline of the USA as a manufacturing base, I suspect that the rest of the manufacturing world is increasingly at ease watching the USA stay with FtI (+grace) and it's mainly US industry, and the foreign academics, like Professor Straus, who urge "harmonisation". Of course, academics have a common interest in raising the awareness of work by other academics.

Just like in a chemical reaction with a big "activation energy" hump, there is a huge implementation barrier between FtI and FtF. Personally, I find it hard to imagine the USA, in my lifetime, getting over that barrier.

For your thoughts, I should be grateful.

[bsn]

Dr Katznelson,

I have read your paper, and I remain of the opinion that your figures are bogus and your arguments flawed.
Your 14,000 to 23,000 is based on an extrapolation of a giure quoted in a 1990 paper which was arguing against first-to-file. Without seeing that paper and its references, I can't tell if the 3%-5% figure was ever accurate. I certainly have no basis for assuming it is now.
I operate in Australia, and the only derivation cases I have ever seen relate to situations where the parties were closely linked (eg ex-employees). Your claim that a first inventor will autmotically run a derivation case where there is no obvious mechanism for derivation is absurd. Your claim that "[those who lose more than a year of priority rights] are probably the most valuable patents" is also self evidently absurd. Your reference, in any case, is related to university patents and there's no basis for suggesting that these are representative.
I won't go on, because it would be a further waster of my time.

[MaxDrei]

bsn, you write from a common law jurisdiction, which increases your credibility. I am in Europe and share your scepticism, but I learned long ago that to apply legal experience gained outside the USA to legal issues inside the USA will lead you astray. That rule works just as powerfully the other way. Many American lawyers fancy that they know how things operate under FtF. While most of them haven't a clue, some of them do know. They are the ones in house in American industry, intent on building and guarding a world-wide patent portfolio, to benefit millions of American shareholders and employees.

[bsn]

I agree, Max. They operate in both systems. Conversely, many of us in the ROW also operate in both systems, as the US is an important market for our clients.
There are good arguments in favour of a FTI system, as there are for FTF. On balance, I like FTF, but that's neither here nor there. My main preference is that, in this area at least, we have harmonization. It's silly (and a waste of R&D dollars) for researchers the world over to keep lab-books designed against the possibility of interference proceedings in the US. And this highlights the red-herring in the 'only 70 interferences per yer' argument. It is the record keeping required of the other 460000 applicants that is a waste of resources.

[MaxDrei]

bsn, great insight. Shows how wrong I am. All that record-keeping: it's second nature to Americans, so costs them little. But it's alien to ROW, so they do it badly, or not at all. Home advantage to the USA.

Unless, of course, patent rights outside the homeland bring financial advantage, and all that record-keeping lulls Americans into thinking that they can file as late as they like, and still overcome the foreign competition. If that were the case, then all that record-keeping would be hurting the national interest.

I think I had better read the Bagley Paper now.

[Leopold Bloom]

"I looked at the claim. I'm speechless. In part that's because I am gagging on my own vomit. Am I supposed to know who these inventors are?"

Probably. Mark is a frequent poster here.

"The Markets, Patents & Alliances team, comprised of Mark Nowotarski and Tom Bakos, has over 50 years of combined experience in the technology, insurance, health care, electronics and manufacturing industries.

Real-world experience gives Mark and Tom the ability to accurately assess the patentability of an invention, and to develop patent strategies that are consistent with each client’s larger business objectives."

[breadcrumbs]

"I think people massively underestimate the aggregate costs of the difficulty in applying 102 here and abroad."

Michael F. Martin,

I do not understand what costs are aggregating in the application of 102. Can you identify what these costs are?

Is your argument that any cost due to the difference between the US system and the rest of the world is a 102 cost? From all that I have studied, the US 102 structure and first to invent provides an unmistakably clear advantage over the rest of the world and first to file.

[MaxDrei]

Prof. Bagley's paper was for a Symposium on entrepreneurship, and everything she writes is tailored for that audience. But her statement on page 30 is not just for the entrepreneurs. It is vitally important for everybody with an interest that the patent system functions satisfactorily, in the USA. She writes:

...a move to FITF should be delayed until domestic consensus is reached on the necessary complements to FITF, such as the scope of prior user rights, the breadth of the grace period, and the impact of the grace period on priority.

I invite attention to the word "necessary".

[Lionel Hutz]

Ron

131 affidavits have offered me an easy way out when a tenacious examiner insists on maintaining a superficially reasonable, but incorrect 103 rejection and the client does not want to appeal.

However, I still say so what? Dennis is completely wrong. I have no pony in this race, but I just do not see the issue people have with FTF. I think what interferences do show is that most of the time the first to file is still granted the patent.

I do sympathize with the harder prosecution argument. However, why should we not reward the first inventor to file? If you can show derivation, then fine. But we both new those cases are few and far between.

Does it help to say I strongly believe we should simply drop IDS's and the whole requirement to report material publications and disclosures.

[MaxDrei]

David Boundy writes that litigating in Japan is a nightmare because the specification is too thin to fix the scope of protection with any degree of precision. Funny, I'm always thinking that the scope of protection of a claim of a US patent is so difficult to fix, and such a joy for the litigators, precisely because the specification (and the file wrapper) is inordinately lengthy.

Mr Katznelson would have it that FtF results in poor quality filings. In reality (here in Europe) it is exactly the opposite. If there's a defect in the sufficiency of disclosure in the app as filed, the patent is incurably invalid. We in FtF land have to make double sure the disclosure on the filing date is good enough to meet the insufficiency provisions of our Statute. We know there is no second chance. I'm thinking that the ones who rush to file are the FtI crowd, with their provisionals and what not.

Now, Mr Katznelson tell me. Exactly what is it in European law on the absolute requirement for sufficiency of disclosure on the filing date, as the quid for the pro of a grant certificate, that is so misconceived and plain wrong?

Prof. Bagley is right. In sorting out priorities between inventors, we need clear rules about what constitutes "sufficiency", on the legal date in view.

[Lionel Hutz]

I have no problem with a grace period under FTF, and most countries do have some sort of grace period. They are just limited to particular circumstances (trade shows, unauthorized third party actions, etc.) This latter assertion is based upon my knowledge of the law circa 2000.

The one year grace period under 102(b), 102(d) and 102(f) do not need to change under FTF. Of course, 102(a), 102(c), 102(e) and 102(g) make no sense in a FTF system.

[Lionel Hutz]

Do people really expect there will be a lot of derivation suits? Yes, it happens. But a relatively tiny amount of cases. It probably won't affect independent inventors at all. More probably small vendors and larger companies. And in those situations, I have seen it go both ways (and I have seen it go both ways rather innocently, but that is beside the point). Avendor ends up using information received from a corporate customer, or a large tech company patents an improvement to technology that is owned by a vendor without a complete enough IP agreement.

[MaxDrei]

Wait and see Mr Hutz. Why does the EPC have no grace period (except one that is applicable once in a blue moon)? Why does Japan require that the grace period provision be explicitly invoked on the filing date? Try operating FtF while retaining open house on the grace period. I might be wrong but I foresee nothing but trouble (as many many industry patent people have urged on Europe's patent pope, Herr Prof. Dr Dr Joseph Straus). What does David Kappos or Philip Johnson have to say about that toxic combination FtF + grace?

[Mark Nowotarski]

"I'm speechless."

Malcolm's speachless? Now I'm speachless.

[MaxDrei]

Was that a peach of a joke, too subtle for me? If I might speechify: What is this word "speachless"? It's not in my dictionary.

[EG]

"Don't opine before you look at Dr. Katznelson's underlying data, and read his methods."

Hear, hear! And bsn that means reading Ron's article in depth and with understanding. Calling Ron's figures "bogus" is pretty strong language, and you had better be supported with the same thorough analysis that Ron does, or your arguments too will be viewed as "flawed."

[Mark Nowotarski]

"'speachless?' It's not in my dictionary."

Nor mine. Sorry about that. One of the hazards of posting before my first cup of coffee.

[MaxDrei]

Mark, so gracious. Pearless manners, if I may say so.

[Lionel Hutz]

Max,

US inventors who may want to file overseas, are screwed by a pre-filing disclosure, regardless. How would a one year grace period in the US under FTF be any different than the one year now.

If a client informs me now that an invention has been publicly accessible now, I inform that inventor that filing outside the US is not possible. I do not see how that will change if we switch to FTF and include a grace period.

[Babel Boy]

My problem with both Katznelson's and Bagley's work is that they both completely ignore provisional applications. And deferred examination. These "oversights" make their recommendations essentially irrelevant.

Katznelson's speculation that the number of derivations will equal the number of interferences is just that. Speculation.

If the grace period is retained, it might not be an unreasonable speculation. But essentially, what the speculation amounts to is a reason for dumping the grace period. As Bagley points out, the grace period doesn't really work with FTF. If grace period is dumped, the communication element of derivation would be almost impossible to prove because there would be no public disclosure prior to filing.

The US needs to dump the grace period, go to FTF, institute 3 year deferred examination, and institute very strong prior use rights.

[MaxDrei]

Nor me Lionel, and sorry if something I wrote was misleading. Mr Katznelson's public doesn't file outside the USA. Meanwhile, on these pages, others routinely assert that foreign filings are a complete waste of money anyway.

It is not as if foreign filing is "not possible" though, is it? Why not 1) convince yourself that there simply was no member of the "public" to whom the claimed subject matter was "made available" 2) file, and 3) bank on none of those foreigners who are going to be issuing those revocation proceedings ever finding out about the public disclosure? With no discovery or cross-examination in civil law countries, your clients might just get away with it, despite what the law says.

[David Boundy]

Lionel Hutz -

Your comments would be correct IF all that S.515 did was replace a few words in 102(g), to replace "before such person's invention thereof" with "before such person's effective filing date," and otherwise left the grace period intact.

But that isn't S.515. Read the amendments to s 102. Then keep reading. The drafting is INCREDIBLY opaque - I think part of the reason nobody's been complaing about "new 102" is that almost no one has taken the time to decipher it!

S.515 redefines the grace period around facts that you cannot possibly know at the time you're inventing. The grace period terminates on facts that will only become knowable months or years later. Becuase you can't know whether or when the S.515 grace period will suddenly pop like a soap bubble, inventors, patent attorneys and business people will have to operate on the assumption that there is NO grace period. The practical effect on day-to-day business life will be that you must operate as if there were no grace period - product introductions will be held until the patent attorney gets finished, and attornies will file sloppy applications becasue the business people are breathing fire. You will have to file on every conceivably-patentable but still half-baked idea, becuase S.515 sets up a "use it or lose it" scheme that is FUNCTIONALLY (during the early invention stage) indistinguishable from no grace period.

The total national budget for patent prosecution is 3X or so the total national budget for patent litigation, licensiong, etc. For a small improvement in the smaller number, S.515 imposes a large cost increase in the larger number.

Nobody thought this through until Dr. Katznelson. Let's hope he succeeds.

[MaxDrei]

Definitely two cultures here. What you get from Europe for filing at the USPTO looks, to you, "sloppy". Simultaneously, what we receive from the USA for EPO filing looks "sloppy". I am not at all convinced that FtF will prompt an overall increase in the level of sloppiness. Not a few people like to boast "I do my best work when I'm up against a deadline" and they are not 100% wrong in what they assert.

[ThisMortalCoil]

Quick question for any US attorney willing to answer:
102(e) reference is a published US application. Its filing date post-dates my client's UK priority date, but its related US provisional filing date pre-dates the UK priority date. How can I get hold of a copy of the US provisional application to see if the published app is a valid 102(e) reference?
It's not in the PAIR image wrapper for the published app. Should it be? If not, how else can I get it?

[Public Searcher DIP]

I ran across Tom and Mark's patents a few months ago and assumed they were an experiment in "plain language" claiming rather than serious applications. If that is the case, I applaud those two in running such an experiment and trying to see if the peer to patent system can work on concepts understood by someone other than a software engineer. We, reading this blog, are trained to read claims in their current format, but the rest of the world is not and tapping their prior art resources is not a bad thing if better examination is the end result.

[Malcolm Mooney]

Boundy "The rewrite of section 102 is as big an economic disaster waiting to happen"

Give me a fracking break.

[MaxDrei]

The "rest of the world" presumably includes members of juries. What class of person could be more vitally important, to the holder of a US patent? However, from the near total absence of "plain language" in the effluent stream from the Patent Office, I have to conclude that the typical patent owner wants it that the jury members shall have a hard time understanding the claims. The reasons for that I can only guess at.

[Malcolm Mooney]

PSDIP "I ran across Tom and Mark's patents a few months ago and assumed they were an experiment in "plain language" claiming rather than serious applications."

Hmmm. I don't see what's "plain" about referring to an arrangement between a driver and an insurance company as a "product". I'm sure folks do this in the field but the "plain" term for such an arrangement is a "deal" or a "contract". Of course, using that language would strip the veneer off what appears to be a quintessential example of an unpatentable method under Bilski (and numerous cases prior to Bilski).

By the way, did everybody see the SG's brief arguing for denial of cert? As expected: it's a winner.

[Paul F. Morgan]

Thanks for some of the substantive comments on this topic above.
As noted, the patent reform bills already have a one year grace period for the inventors.
What this legislation would not provide is the continued ability to cloud patent rights [far more widely and more commercially important than just eliminating interferences] by allowing almost any 131 declaration ["reviewed" only by a non-attorney examiner] to "swear behind" [instead of distinguishing over] earlier-filed patent applications of others. [131 declarations are not even legal if any disclosure equivalent to the reference was published more than a year before the applicant's filing date, but that is rarely checked by the PTO.] Patent claims obtained with 131 declarations rarely survive reality tests in litigation, as demonstrated in a JPTOS study published by Mary Helen Sears many years ago, because they do not meet the real and tough tests for actually proving "prior invention." Yet they are widely miss-used. No attorney actually experienced with both would equate the high evidentiary standards needed to even initiate a derivation proceeding [to be run by the APJ trial team] with a typical completely unchallenged (even if clearly inadequate) 131 declaration or toi even argue that there will be as many derrivation proceedings as interferences.
There is, however, with a first-inventor-to-file system, a real need for an accompanying 'prior user' personal pure defensive right for those who have expensively developed actual products but not yet launched them or filed applications on every detail thereof prior to the filing date of another party.

[Mark Nowotarski]

“I applaud those two in running such an experiment and trying to see if the peer to patent system can work on concepts understood by someone other than a software engineer.”

Public Searcher,

Thank you for the compliment. You are right in the sense that these are experiments. So far, the results are encouraging. Tom’s application was written with an actuarial audience in mind and right now we have at least four “Fellows” from the Society of Actuaries reviewing it.

Mine was written with a more general audience in mind. It seems to have worked. An entire class of MBA students at Kent State have uploaded considerable commentary and prior art. When I contacted them, they said they chose it because “it was the most interesting application on the site”.

The style may be unconventional, but both of these are “serious” applications. We have every intention of prosecuting them vigorously and commercializing the inventions disclosed therein.

More background can be found in our articles “Canaries in a Coal Mine”: http://www.marketsandpatents.com/bulletin/IPB-04152009.html

And “An Experiment in Better Patent Examination” http://www.marketsandpatents.com/bulletin/IPB-12152008.html

[Paul F. Morgan]

Re the allegation: "Lets be clear, in the US, proponents of the first to file legislation want to make it easier to invalidate patents by creating more prior art."
This is confusing two separate issues. The expansion of prior art in the patent reform legislation is due to to its eliminating the "in the U.S." limitation now in parts of 102, NOT due to [or required by] "first to file" which merely ends dubious Rule 131 declaration "end runs" on prior art which is ALREADY prior art under 102(e), and "first to file" will REDUCE present existing [and dangerously unknowable without litigation] prior art under 102(g)(2).

[Mark Nowotarski]

“Of course, using that language would strip the veneer off what appears to be a quintessential example of an unpatentable method under Bilski”

Malcolm,

Exactly. Our goal was clarity of concept for the benefit of the reviewers. Statutory subject matter issues can be dealt with by a preliminary amendment before it goes off to the examiner.

Still, I’m kind of surprised that no one on the peer to patent site has raised the issue of Bilski. We even have an anonymous patent examiner on the review team.

Care to have the honors Malcolm? I think it would be very educational for the MBA students to be exposed to these issues.

The review page is here: http://www.peertopatent.org/ Just hit the “most active teams” button. We are second from the top.

[David Boundy]

Paul Morgan is partially correct. S.515 does three things, the first two of which he acknowledges, and that I'm basically fine with. But it's the third effect of S.515, not acknowledged by Mr. Morgan, but it's the one that does the damage:

- S.515 changes from first-to-invent to first-to-file. (I have no data and no opinion.)

- S.515 makes "on sale or public use" art outside the U.S. prior art. (Again, no data and no opinion.)

- S.515 makes ALL disclosure by third parties presumptively prior art up to the filing date, and puts the burden of proof on the inventor to prove derivation of every single third party use.

Here's what S.515 does. Inventor X invents something, and test markets it. Folks make improvements, write blog articles describing the invention but not directly attributing X, etc.

X, thinking that "Oh gosh I have a one year GRACE PERIOD, those nice people in Congress wouldnt have taken that away!" waits to files his patent application until he's sure he's got something, and his attorney can write a good application. He files on day 364.

Three years later, the examiner goes to Google and finds 100 hits.

X has to PROVE THAT EVERY SINGLE ONE OF THEM was a derivation.

S.515 is effectively repeal of the grace period. It's bad policy. By putting a "file it or lose it" gun to the head of every inventor, it sharply increases the costs of the patent system, and reduces the utility. More "bad" patent applications will be filed.

S.515's rewrite of section 102 is a colossally bad idea.

[6]

"Still, I’m kind of surprised that no one on the peer to patent site has raised the issue of Bilski. We even have an anonymous patent examiner on the review team."

And you would have 6KForGLORY but the site won't send me an email so I can activate my account. I would have brought up a bit of Bilski, but I'm not sure, as I wasn't sure if they actually sold you a product in the form of an object, which maybe symbolized the deal. If so, it might be stat. Anyway, I also was going to post there that you were missing something in the reference the examiner cited. If, as you plainly put it, the claim only requires that the monitoring be capable of monitoring while driving, then sure the breath device to turn the car on can monitor while driving. Simply wait until the car cuts off going down a hill and needs to be restarted. I promise that the monitoring will have gone on while they are driving.

[6]

"Care to have the honors Malcolm? I think it would be very educational for the MBA students to be exposed to these issues."

Maybe you could also educate them about what is actually needed for patentability and then have them post. As is, they sound like complete ignorami spouting off about how the idea needs further development before they can get a patent. Sure, it's funny, but wtf man?

[Malcolm Mooney]

"As is, they sound like complete ignorami spouting off about how the idea needs further development before they can get a patent. Sure, it's funny, but wtf man?"

I noticed that, too. A tad presumptuous.

"wasn't sure if they actually sold you a product in the form of an object, which maybe symbolized the deal"

Is memorializing a deal a patent-worthy transformation? I hope not.

My view is that the concept of insuring people based on their behavior is unpatentable, regardless of their behavior. There is no transformation.

If you have invented a novel non-obvious machine for measuring the level of inebriation of a driver, then patent the machine.

Otherwise, find something constructive to do with your life.

[Leopold Bloom]

"Care to have the honors Malcolm? I think it would be very educational for the MBA students to be exposed to these issues."

I'm siding with Malcolm on this one. I think your pretense that you are performing some kind of public service is disgraceful, and the statement in your patent application that "the tone is conversational and the 'claims' are in common language so that those who are not familiar with patents can readily understand them" is condescending.

Just my opinion. Sorry, I get sensitive when it appears that my colleagues are going out of their way to intentionally make a mockery of the profession.

[Mark Nowotarski]

"site won't send me an email so I can activate my account."

6, I'm sorry to hear that. I don't know what the problem is, but you can send a note to the web master or perhaps set up a gmail account if, for some reason, it won't register to a USPTO domain.

I any event, I've also brought the problem to their attention.

[Malcolm Mooney]

"Folks make improvements, write blog articles describing the invention but not directly attributing X, etc."

LOL. What those folks are doing is what constitutes the entirety of 90% of applications filed for the past 10 years, i.e., obvious, trivial derivations of stuff that, for whatever reason, is already in the public domain.

"By putting a "file it or lose it" gun to the head of every inventor, it sharply increases the costs of the patent system, and reduces the utility. More "bad" patent applications will be filed."

Here's a suggestion: before you "test market" your invention, file a patent application with as many of the derivations as your creative patent-worthy mind can dream up. If you come up with non-obvious improvement, file another application. Many American inventors already file applications as if the system were a first-to-file system. Why do they do that? Because they plan on marketing their product all over the world and don't want to risk losing their rights.

[Mark Nowotarski]

"Simply wait until the car cuts off going down a hill and needs to be restarted."

I actually know someone working on this problem. I'll send a note and ask how they deal with it. It seems to me that an alcohol ignition interlock based on either a breathalyzer or skin galvanometer would have to be disabled once a car is in motion.

But this really isn't the forum for a technical discussion.

[Mark Nowotarski]

“If you have invented a novel non-obvious machine for measuring the level of inebriation of a driver, then patent the machine.”

Of course, but if I want to see if Peer to Patent is a useful forum for getting feedback from insurance professionals, I need to draft the application and the claims in terms they will understand.

[broje]

More to the point, isn't the site about getting prior art submissions, rather than 101 and 112 arguments? Why would it matter if the claim, as written, tries to preempt every application of the basic idea, instead of being directed to the enabled subset of solutions to the problem of rendering a useful application of the idea? I'm not saying that it does that. Just, why would it matter? It is highly useful for the purpose of eliciting relevant prior art submissions.

[David Boundy]

Thanks, Malcolm, you've made my point exactly.

> Here's a suggestion: before you "test market" your invention, file a patent
> application with as many of the derivations as your creative patent-worthy
> mind can dream up. If you come up with a non-obvious improvement, file
> another application.

Thank you for parroting EXACTLY what I said. For every dollar that S.515 proposes to save somewhere, it will cost several dollars in added preparation costs, filing on inventions that never go anywhere, etc.

If the PTO thinks it's overwhelmed with bad applications today, wait til this goes into effect.

[6]

"How can I get hold of a copy of the US provisional application to see if the published app is a valid 102(e) reference?
It's not in the PAIR image wrapper for the published app. Should it be? If not, how else can I get it?"

You can get ahold of it by contacting the examiner, or at least you should be able to. However, I would say that you're just missing it in the PAIR entry, if indeed they have referenced priority back to it. And yes, it should be in the image wrapper, or, it may only be in the image wrapper of a previously filed pub to which the instant pub to which you refer is claiming priority to in order to chain priority back to the prov. If you post the num I'll see what I can do.

"Is memorializing a deal a patent-worthy transformation? I hope not."

Well Idk about that, and I would hope not either, but it isn't something that I would raise a Bilski rejection over since it is too new.

"filing on inventions that never go anywhere, etc."

But that's improving the disclosure of inventions amirite? LOL caught between a rock and a hard place Boundy. Either argue for the promotion of the useful arts or argue for your backards system. Personally I'll join you in arguing for the backwards system even though it directly countermands the entire purpose of patenting from the gov's point of view, relatively speaking.

"But this really isn't the forum for a technical discussion."

Well of course not, you might accidentally invent something in the course of everyday discourse on the subject that will be good litigation fodder later.

[Ron Katznelson]

MaxDrei,
Thank you for commenting on this from the European perspective.
Unfortunately, there appears to be a communication gap here, and not just in one area. The problems appear to be that of (or the lack of) *reading*.

You say: “David Boundy writes that litigating in Japan is a nightmare because the specification is too thin to fix the scope of protection with any degree of precision. Funny, I'm always thinking that the scope of protection of a claim of a US patent is so difficult to fix, and such a joy for the litigators, precisely because the specification (and the file wrapper) is inordinately lengthy.”

Apparently you failed to read David’s comment. He said: “Have you ever tried to litigate a *Japan-origin* patent? I have, several times.” He speaks of patents of Japanese *origin* litigated here under U.S. patent law. Did you think he was speaking of the effects of S. 515 in Japan? David was merely saying that we already have some idea how the additional applications filed under FTF in the U.S. would look like by looking at some foreign originated applications that were created under FTF and were not changed prior to filing at the USPTO.

You say: “Mr Katznelson would have it that FtF results in poor quality filings. In reality (here in Europe) it is exactly the opposite.”

Again, it appears that you failed to *read* our letter linked above and the research linked therein. Whether you are an American, European or Japanese, when you file an application subject to filing date priority, the application is bound to contain less quality material that is ultimately relevant for patent protection. Your statement that “In reality (here in Europe) it is exactly opposite” is based on no facts. The facts for applications in the EPO do not support your statements and those facts are shown in Slide 9 of my FTC presentation linked in our letter. To help you *read*, here is the FTC link directly:
http://www.ftc.gov/bc/workshops/ipmarketplace/mar18/docs/katznelson.pdf . Perhaps your theory can explain why 58% of direct filings at the EPO that are first filings (meaning, filing “under the FTF gun”) are abandoned before examination, as opposed to only 12% of direct filings for which the priority does not depend on filing date (meaning, mature applications not filed “under the FTF gun”)? Some of the first-filings are abandoned before publication, so you would not see all of them on the EPO public database. Can your theory explain why 26% of first filings are abandoned even before the availability of the search report, *ten times* the corresponding rate for applications that are not “under the FTF gun”? Do you think that these abandoned applications would have been dropped if they were found by their owners to have the relevant quality? - Of course not. Does this mean that Europeans are sloppy or have poor drafting practices under pressure? - Of course not. It only speaks to the nature of the material *available* to them *at the time* they had to file the priority application. If you *read* our letter, you would appreciate that “relevant quality” is not an attribute of which the patent practitioner has much control, but is determined by the available details of the subject matter and the applicant’s mature understanding of its significance. The point our letter makes is that under first-to-invent, the majority of the 58% applications that did not reach examination at the EPO would not have been filed to begin with. This is what we mean by saying that under FTF in the U.S., the USPTO would be flooded with at least 20% more applications per year.

By the nature of other comments dismissing our concerns of having to file at every phase, absorbing higher patenting costs, and the resulting USPTO “flooding” effects, it is apparent that those commenting may not have been involved in running engineering organizations that engage in inventive R&D. It is not an accident that you hear the concerned voices of people like Ron Katznelson or Steve Perlman, who have founded companies and have managed engineering R&D organizations engaged in developing new technologies. Ours is not a voice of patent practitioners who witness these activities only peripherally. The effects on patenting activities of companies of the type that Sreve Perlman and I ran are not academic. Based on specific R&D projects at my company, I have shown in Slide 5 of my FTC presentation linked above the additional patent applications (shown in light green dots) that would have been filed during our startup years before 2000, had FTF been the law in the U.S. Most of those hypothetical applications would have later proven to be useless, but we would not have known that at the time. Steve Perlman explains with equal specificity a similar experience at his technology incubator company. Witness it directly from him during a discussion on FTF at the end of this month’s video on patent reform:
http://link.brightcove.com/services/player/bcpid22364960001?bctid=22402118001 .
I understand that when Steve spoke of his development paths, he was holding the chart I received from him, which I included as Slide 6 of my FTC presentation linked above.

Finally, MaxDrei, you say “Now, Mr Katznelson tell me. Exactly what is it in European law on the absolute requirement for sufficiency of disclosure on the filing date, as the quid for the pro of a grant certificate, that is so misconceived and plain wrong?”

Again, it appears you failed to *read* our position. I have said nothing about European law to even suggest that it is “misconceived and plain wrong”, including when it comes to its requirements for disclosure. On the contrary: I highlighted the fact that in Europe, standards for enablement of a prior art reference for purposes of anticipation of a claim are the same as those required to support the allowance of such a claim under Article 83 of the EPC and that it lacks the *complexity* of our system. (See enumerated Paragraph 12 of our letter). My point was that the systems are *different* and lead to different results– not that the European law is “misconceived” or “plain wrong”. Rather, our letter’s Paragraph 12 makes the point that you appear to embrace from Prof. Bagley's paper: that FTF cannot just be “imported” without considering the “necessary complements to FTF”. Because we have other legal requirements in the U.S. that do not fit with the results of FTF, the harm of S. 515 will be even greater.

[fish bones]

David Boundy wrote "If the PTO thinks it's overwhelmed with bad applications today, wait til this goes into effect."

I agree, David.

[Noise above Law]

Once upon a time MaxDrei was an interesting bloke who would occasionally post a provocative stand and "learn" from the ensuing discussion. Also, MaxDrei would push his favorite Euro-style goods when the situation touched upon aspects that may be in play.

Not lately.

Hmmm,

anyone else notice that since I routinely take Malcolm to task for his poor logic that the "character" of MaxDrei has become much more belligerant, bellicose and pushes more of an anti-US view more so than a pro-Eruo view? The anti-US evidence is plainly (and quite politely) put forth by Mr. Katznelson in that good 'ol MaxDrei can no longer bother to read, much less "learn",

Time to wash the smelly sock.

[Ronald J Riley]

The level of misunderstanding of how inventors and the patent system actually interact on this forum is staggering. The same is true of how inventors and patent pirating interests interact. At this point I cannot tell if the writers are actually as ignorant of these issues as they appear or do they have an ax to grind.

David Bounty and Ron Katznelson do know what they are talking about. Most others posting do not!

First to File (F2F) is a nightmare for a number of reasons. One which was alluded to is that F2F causes people to file early and often, in the expectation that many if not most of the applications will not be prosecuted. The end result is large volumes of pseudo prior art which becomes a weapon for invention thieving large companies. Japanese companies have honed the use of this to a fine art.

F2F, early publication, and so called prior user rights all facilitate fraud by big corporate interests. Examples of such fraud are RIM in the NTP case and Microsoft in the Eolas case.

Shorter time lines created by F2F and publication greatly facilitate foisting false evidence on the court. Prior user rights creates a whole new class of potential fraud. This is why we torpedoed prior user rights during the patent deform battle of the nineteen-nineties.

Patent deform was drafted by and for the benefit of large patent pirating companies. We have domestic and foreign companies who want to undermine the greatest and most successful patent system the world has ever seen to facilitate their misappropriation of American ingenuity.

I ans virtually every other inventor I know could not care less about what people outside the US think of our patent system. Their opinions are not relevant because the system is not designed to serve the interests of big companies. This is the essence of what the Patent Deform fight is about.

The inventor community keeps dealing Patent Deform mortal blows. Last year it was an alliance with organized labor. This year it is another tactic every bit as devastating.

What is really funny is the the representatives championing Patent Deform know it is not going to do any better this year than it has in past years. They are simply milking the Coalition for Patent Fairness and the 21st Century Patent Coalition one more time.

This is really poetic. One kind of crook fleecing another.

Ronald J Riley
President - www.PIAUSA.org - RJR at PIAUSA.org
Speaking only on my own behalf.

Other Affiliations:
Executive Director - www.InventorEd.org - RJR at InvEd.org
Senior Fellow - www.PatentPolicy.org
President - Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 - 9 am to 8 pm EST.

[Paul F. Morgan]

Dave Boundy would seem to have a valid point about a practical defect in actual use of the reform bill's grace period for inventors, except perhaps for the presumed intent of the following additional paragraph in the new 102?: "EXCEPTIONS.—Subject matter that would otherwise qualify as prior art only under subsection (a)(2), after taking into account the exception under paragraph (1), shall not be prior art to a claimed invention if—
...
(B) the subject matter had been publicly disclosed before the effective filing date
of the application or patent set forth under subsection (a)(2) by the inventor or a
joint inventor, or by others who obtained the subject matter disclosed, directly or
indirectly, from the inventor or a joint inventor before the effective filing date of the
application or patent set forth under subsection (a)(2)"

[Ronald J Riley]

Fixing the Patent Office

The patent office has become dysfunctional, in my opinion primarily because of incompetent and corrupt management. I firmly believe that most of the problem is that the office is being run with an eye to currying favor with big companies. I believe the motive is post USPTO employment opportunities.

There is a broad perception in the inventor community that the USPTO is serving the interests of big companies. This has been a problem for some time. Gordon Gould's case was one example. There are many others. The problem has become much worse in the last decade.

This is one reason that the inventor community has vigorously opposed expanded USPTO rule making authority.

Ronald J Riley
President - www.PIAUSA.org - RJR at PIAUSA.org
Speaking only on my own behalf.

Other Affiliations:
Executive Director - www.InventorEd.org - RJR at InvEd.org
Senior Fellow - www.PatentPolicy.org
President - Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 - 9 am to 8 pm EST.

[Ron Katznelson]

Paul Morgan:
I suspect that you have missed David Boundy's point. *Read* what he wrote again. The exception you cite does not provide a real grace period. It applies only if
"(B) the subject matter had been publicly disclosed before the effective filing date of the application or patent set forth under subsection (a)(2) by the inventor or a joint inventor, or BY OTHERS WHO OBTAINED THE SUBJECT MATTER DISCLOSED, DIRECTLY OR INDIRECTLY, FROM THE INVENTOR OR A JOINT INVENTOR….”

The inventor would then have to prove that EVERY third party subsequent publication, internet newsletter, marketing document or trade show material describing the subject matter prior to the filing date has a clear chain of derivation evidence connecting it to the inventor’s disclosure. Do you believe that would be easy to prove? Would you advise your clients to rely on this exception and delay filing? What discovery mechanism would you use to obtain such derivation evidence in response to an office action citing such public disclosure reference?

[Ron Katznelson]

Paul Morgan:
I want to clarify that my comment above relates to a private inventor's disclosure, not a public one. So, if your point is that there is a one-year grace period for PUBLICATIONS, you are correct. That may satisfy certain academics but not entities that need to make private disclosures. That is very different than what we have today. I believe that was what David Boundy intended to say.

[6]

"There is a broad perception in the inventor community that the USPTO is serving the interests of big companies. "

Well of course we are. Who's interests do you think we're serving?

At the same time, we also serve your small business client's interests as well.

The way we serve their interests is by examining the apps they send in.

[David Boundy]

Paul Morgan -

I addressed this language directly in my post of May 8, 12:46 PM.

I know that 102(...)(B) exists as a theoretical matter. The "grace period" it creates is totally illusory. In the real world where decisions have to be made on the information available today, not the information available years ago, the practical problems of proof render this supposed "grace period" totally unreliable and unuseable. Sure, the words are there on the page, but as a PRACTICAL provision that you can advise a business on - it's non-existent.

Paul, we've worked together over AIPLA notice-and-comment letters, and I know you're capable of looking past words on a page to their practical effect. Time to put that back to work.

David

[David Boundy]

Or, to reduce it to practical terms, Paul, if an inventor came to you for advice, and said "I want to test market my gadget. I can do that for a year, right? Because I've got a grace period?"

Would YOU advise the inventor to wait to file? Or would you, like Malcolm, advise the inventor that it's crazy to wait, better to file early and often (and crappy) than wait?

[Steve Perlman]

I've developed QuickTime, most of Microsoft's TV products, Moxi, Mova Contour and recently, OnLive, in the US under the FTI system. Under FTI, we file far fewer patents and they are much deeper and more relevant, than we would have to under FTF to to retain priority.

For example, in the case of Mova Contour, a 3D facial capture technology which was used to capture Brad Pitt's face in "The Curious Case of Benjamin Button", over the course of about 5 years of development we came up with about 100 distinct inventions. Almost all were dead-ends, and by the time we were done, only 7 of the inventions were in the final working system. Those are the only patents that were filed, and they were deep.

To have retained priority under FTF, we would have had to file shallow disclosures on all 100 inventions, which would have been far too costly for a startup. We could have tried to select what looked like the most promising inventions at the outset, but as it turns out, the most promising invention at the outset was a dead-end. We went back to a combination of 2 different initial inventions that turned out to be the key. So, even had we taken our best guess of a subset to file under FTF, we would have been wrong.

We spend between US$5K-15K per patent filing, so FTI drastically reduces our patent filing costs as well as reduces engineer distractions. And, it reduces the number of patents the USPTO has to handle. It has allowed us to move very rapidly and build very defensible startups (all 100% practicing entities).

Given the current economic environment, our startups have only closed funding this year because of the depth of their patent portfolios. They are core to due diligence. Under FTF, I do not see how we could have developed the patent portfolios that enabled us to find funding this year.

FTF would heavily benefit large companies who have the resources to file "race to the patent office" patents. While I was President at Microsoft I was essentially instructed to file a patent on "anything that moves" to "paper the patent office". I can attest to the fact that large US companies recognize they have a huge resource advantage in patent filings. FTI gives startups and universities a fighting chance and is one reason why the US has such a robust startup economy.

Steve Perlman
President & CEO
OnLive, Inc. & Rearden Companies

[MaxDrei]

I'm grateful for the response Dr Katznelson. I post under a pseudonym because I have other things to do, and not much time to post here. Readers, give my comments exactly as much weight as you think they warrant. Feel free.

It's Saturday, so I will give it less time than ever.

Your anti- FtF point is that so many first filings at the EPO "abandoned". Here are two reasons (for what they're worth) why I'm sceptical.

1) The excellent EPO search knocks out much of the scope. what is left is protected in a fresh EP or PCT filing, before the end of the Paris year, with a declaration of the priority of the "abandoned" priority filing, and a spec that demonstrates patentability over the closest art.

2) The inventors have been working, all through the Paris year, and have told me a lot more about their invention. At the end of the Paris year, I file a lengthier disclosure of the "same" invention, and declare the priority of the earlier filing.

Indeed, for my clients, the routine procedure is i) file ii) digest search report iii) supplement the disclosure iv) file PCT.

Sorry if that's all covered in your ITC slide. Is it? Would be interested if it blows my theory away.

And, as bsn wrote, better marginally more pat applns to read than millions of pages of lab notebooks to reead before we know which rival gets the patent, no?

[sky pie dk]

What are inventors' thoughts regarding provisional applications? These appear to be used in much the same way as FtF applications would be used - to secure a priority date. I recognize that typically provisionals have a thin disclosure that doesn't provide support for the full scope of the invention typically claimed in the resulting utility application. However, they're still cheaper to file than utility cases. Even under FtF, why couldn't an inventor just file a lot of provisionals and keep working before deciding which ones to convert?

[Ronald J Riley]

Someone from the USPTO says "Well of course we are. Who's interests do you think we're serving?

At the same time, we also serve your small business client's interests as well.

The way we serve their interests is by examining the apps they send in.

Posted by: 6 | May 09, 2009 at 12:41 AM"

Yep, with endless and unreasonable rejections, especially when some big company does not want a patent to issue. I receive a considerable amount of feedback from examiners and have been repeatedly told that management makes it clear that certain party's patents should not issue. The same applies to reexaminations which allow patent thieves to profit with impunity.

Maybe you can shed some light on allegations that a patent pirating company flew USPTO management around on their jet and that there was a close correlation between the timing of those encounters and other USPTO actions?

A private detective contacted me at one point related to their investigation of this issue and told me that they were certain that the flight(s) occurred but were having trouble getting anyone to speak on the record about this.

This is just one of many allegations which have surfaced concerning the USPTO becoming the long arm of specific vested interests.

Or maybe you can explain why the USPTO terminated the mercexchange reexam after ebay bought those patents.

At best there is an appearance of USPTO wrong doing at high levels.

At worst the law is being broken within the agency.

Then there is the issue of the agency placing paid staff in congress to promote an agenda detrimental to inventor interests.

There is much more!!

It would be an understatement to say that the USPTO management's relationship with independent inventors is at an all time low. This is something which management drove.

Ronald J. Riley,

Speaking only on my own behalf.
Affiliations:
President - www.PIAUSA.org - RJR at PIAUSA.org
Executive Director - www.InventorEd.org - RJR at InvEd.org
Senior Fellow - www.PatentPolicy.org
President - Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 - 9 am to 8 pm EST.

[Jules]

Ronald Riley, thanks for your comments. My argument might help your cause.

The USPTO does care about large and small entities, i.e. the public, and I am skeptical about the USPTO having a bias towards large corporations. First of all the Office does have small entity fees, and second of all the Office did try to pass the recent rules package in the interest of patent quality. Yes, you might say the rules were in the interest of reducing the backlog, but consider that if clients were forced to make decisions on their applications quickly then they would look for meaningful protection instead of wasting what valuable little time they have.

Applicants are currently allowed to file tons of claims at extra cost. There is good reason in patent law to allow this, however it leaves the system open to much abuse.

An applicant looking for quality patent protection for their invention may have claims of varying scope. One could accomplish varying scope through the use of extra claims in one application, or through continuation applications. A cost analysis would show the cost of extra claims is comparable to that of a continuation when the number of extra claims is at or below the current number of claims that do not require additional cost in a regular application.

However, the abuse occurs when someone has an anti-patent agenda, i.e. they desire low-quality and even invalid patents. What happens is they can file tons of claims that are very broad. Broad claims force the examiner to make rejections, which in turn takes more time especially when there are tons of claims. Even further, with KSR, dependent claims are more likely to be obvious variations under one or more rationales.

The reason this is a problem, is that when the examiners' time is taken up by these huge overly broad applications, they have less time to thoroughly examine applications with reasonable length and scope. Those reasonable applications likely filed by someone looking for quality patent protection at a reasonable cost.

There are at least two ways to mitigate such problems. First, there can be rules that limit the number of claims examined per application. Second, the production system can be adjusted to allow examiners more time for applications with more claims. Either way something has to give. As it is now, the system appears biased.

I know this is a simplified analysis. I can't hit every single topic in one post. Other topics might include the rules package going way too far, the effects of attorneys milking their clients for easy money, and the heavy cost of litigation versus the relatively small cost of prosection.

[Malcolm Mooney]

Boundy "Or would you, like Malcolm, advise the inventor that it's crazy to wait, better to file early and often (and crappy) than wait?"

Uh, David? That is not at all what I said.

[MaxDrei]

Dennis, Dr Katznelson, readers, over on The Patent Prospector, somebody who isn't me posted yesterday (May 08, at 07.56 am) as MaxDrei. So now I imagine that the same might happen here. But, not to worry. Because I post often, and always in the same style, and because the impersonator has a different agena, false postings will immediately reveal themselves as false. So boring.

I would prefer to continue posting as MaxDrei but it's no skin off my nose if I have to switch to another pseudonym. For effect I rely on the content of my postings, rather than the name under which I post.

Come to think of it, what the heck. Many readers say that what I post is anyway exclusively rubbish, so a bit more twaddle in my name won't make any difference. All the same, Dennis, if you can cap it off, I should be grateful.

[Ron Katznelson]

MaxDrei,
I have read your previous posts and I think it was not the “imposter” to whom I will now respond. You have just made our point in your previous post last night. You described your own process in Europe wherein after filing a preliminary notion of an invention, you then learn whether the invention works, the inventors tell you a lot more about their invention (presumably, what they learned *after* the preliminary filing) and you subsequently have to file a lengthier disclosure of the "same" invention (presumably, to complement the *deficient* preliminary filing), and declare the priority of the earlier filing (presumably, only for subject matter that was adequately disclosed and enabled to support the claims, but not for new matter). What you have neglected to say is what happens if your inventor learns that the invention *does not* work, or if a much better and different approach was devised. Presumably, the preliminary priority filings would be abandoned. Clearly, the result of this process is that instead of having a *single* application that describes and claims a *workable* invention (as is the case under FTI), you end up with having two applications.

You then attribute the abandonments of first filings solely to the filter mechanism of the “excellent EPO search” (a quality assessment with which I agree, at least in comparison with the USPTO), and suggest that this theory explains the difference in abandonment rates of first filings compared to non-priority filings. Your theory may only account for part of the abandonments, as you ignore my specific question asking that you explain the 26% dropout rate *prior to the search report* in first filings, compared to only 2.6% in non priority filings. Clearly, the “excellent EPO search” is not relevant to this huge difference. Moreover, your “Search Report” theory must also explain the substantial difference between the 32% post Search Report dropout of first filings and the 9.5% rate in non-priority filings.

In sum, MaxDrei, you have not shown that FTF produces fewer or better quality applications. On the contrary: you actually confirmed that it produces more applications that are filed prematurely, that lower quality applications (which would not have been filed under FTI) are subsequently replaced by more mature applications and that priority first-filings are abandoned more often due to inadequate applicant vetting against the prior art. This, at higher patenting costs to applicants. But this is not the only harm to applicants. More to follow.

[Malcolm Mooney]

RonK "But this is not the only harm to applicants. More to follow."

[rolls eyes]

Some people just don't know when to give up.

I'm not sure where the claim that "first to file leads to better quality applications" came from. I know I haven't made such a claim. My bias towards a first-to-file system has more to do with harmonization and getting rid of the baroque bullcrap that has infected US patent law (both legislative and judge-made) as a result of our present system.

RonK: "What you have neglected to say is what happens if your inventor learns that the invention *does not* work, or if a much better and different approach was devised. Presumably, the preliminary priority filings would be abandoned."

This happens routinely in the present system. It's neither a feature or a bug, just something that happens.

The only way to improve better patent applications is to improve examination. And that means that fewer patents will be granted because far less junk will slip through the gaping holes that exist in the PTO examining corp right now. Either way, we can be certain that RonK and Co. will howl because, at the end of the day, there is a large contingent of people who are invested in a system wherein crappy patents on every trivial thing you can think of are achieved quickly without great expense. Anything that smooths the past towards that end will be applauded; any obstacle in the way will be derided as "discouraging innovation."

[Nervous and twitchy]

Well, who is the new Director already??? I'm on the edge of my fraking seat here...

[6]

"Yep, with endless and unreasonable rejections, especially when some big company does not want a patent to issue."

Here's a general rule of thumb for you. If there is a combination to be made that may render the patent invalid, and it would not be outrageous to make the rejection, as opposed to merely, meh, this case could go either eway, then you will get a rejection. Perhaps unreasonable to the view of many, and perhaps even unreasonable when viewed in a certain light from the examiner himself, but none the less, the rejection will be made.

Now ask yourself, why is that? The reason is because we're here to present prima facie cases. Not necessarily the most rock solid. How does the case look on its face? Obvious? Then you get a rejection.

Now, this isn't the end of the world, because there are reviewer courts to take a closer look at everything and make sure that the case is actually obvious. It is at this stage where a disconnect has occured over the years, but for the applicant's benefit, and the balance is overall maintained.

Then, throw the case being a high profile case into the mix and you have yourself a recipe for the PTO to necessarily send out the rejection. Why is that? The answer in the next episode of... the 6 report.

"Maybe you can shed some light on allegations that a patent pirating company flew USPTO management around on their jet and that there was a close correlation between the timing of those encounters and other USPTO actions?"

Certainly, from what I understand, it all happened, and nothing was improper about it until you put forward some evidence showing so.

"Steve Perlman"

STEVE! So good to see you! Did you get my email? Will you be retiring your "self"? If you did not recieve the previous email, I would be obliged if you could provide me with a shell email account at which you can be reached.

"Or maybe you can explain why the USPTO terminated the mercexchange reexam after ebay bought those patents."

I don't know how it was terminated so no. Perhaps they found them allowable and it was all good?

[Ron Katznelson]

Malcolm Mooney:
It appears that like some others here, you do not *read* my comments. My point about abandonments when inventors discover that an invention they applied for does not work was not that under FTI inventions will work. Of course it happens all the time. But under FTI we do not file in most of these cases. My point was in rebuttal to MaxDrei’s assertions, showing him that under FTF a lot more of these cases exist. So I will put it to you directly Malcolm: Do you believe that under FTF, (a) the number of applications will not rise? (b) the quality of applications will not decline? This is a YES/NO question. That said, I acknowledge that negative answers to these questions, in and of themselves, do not prove my point. Balancing other costs and benefits must be included. - Read on.

There are those who argue that under the provisional application practice, applicants should have recourse under FTF. Sky Pie DK asks: “even under FtF, why couldn't an inventor just file *a lot* of provisionals and keep working before deciding which ones to convert?”

The answer is that this is exactly what will harm American startups, which is what we are trying to avoid. First, many inventions do not mature within one year. Second, for all practical purposes, except for saving a few dollars in filing fees, a provisional application that can sustain priority rights is essentially indistinguishable from a non-provisional application. A provisional that does not provide robust Section 112 support, may not be effective in and of itself. Small entity applicants already use provisionals in virtually all their priority filings (see Slide 7 of my FTC presentation linked above). The availability of provisionals does nothing to reduce the *frequency* with which applicants would have to file under FTF.

The advantage of FTF cited in comments to this thread is that it eliminates the “uncertainty cloud of patent rights” by fixing and publishing the record upon which applicants can rely to establish patent priority.

To the extent that “patent rights” are to be determined based on a partial record comprised solely of papers filed at the USPTO, then FTF and “new § 102” will indeed remove the uncertainty. Under FTI, however, patent rights are determined based on the *full record*. Under FTI, patent applications and their content are only a part of the record but are significant public stakes in the ground that leave some uncertainty only in a very small fraction of cases - patents that end up in disputes. In contrast, under FTF, there will be a different “cloud of uncertainty” that is much more harmful *to every patentee*: what part of the record that encompasses the invention process will ultimately prove to be essential in sustaining the patent right? This is often unknown upon filing the priority application. FTI permits augmenting the public record in a small minority of cases (disputed cases) in order to establish the boundaries of the patent right. This later ability provides some reassurance to investors for investing in new inventions because the applications are not the “catchall”. Under FTF, all development activity, experimentations, lab reports, marketing surveys, records of using the inventions, etc. would be irrelevant for establishing patent rights. These will be discarded, even if they demonstrate an earlier invention and show that the inventor did not unduly delay filing the application. Thus, under FTF, all applicants will face the “uncertainty cloud of patent rights” and the higher risk of losing the patent right would turn more investment capital away from startups to less riskier opportunities, such as large incumbent companies who will be better able to use their market power to retain or gain market share.

So it all boils down to where one is willing to accept the “uncertainty cloud of patent rights” and the associated costs of removing the uncertainty. Some believe that under FTI, the dates shown on the face of a U.S. patent leave too much uncertainty in efforts to locate prior art that may invalidate it. On the other hand, we believe that under FTF, the uncertainty of securing the patent right in the first place will be too high, resulting in declining investments in new startups that depend on secure patent rights. The hallmark of the American legal system is that it seeks to remove uncertainty by engaging in substantive examination of the *full factual evidentiary record* rather than by adopting procedures designed to eliminate such equitable inquiry for the sake of administrative convenience. For over two centuries under this legal system, American FTI patent law has protected inventors and their investors from the “uncertainty cloud of patent rights” at the expense of facial certainty of the dates available for invalidating prior art. Other nations chose to go the other way. The results speak for themselves as one compares the robust startup and new technology economy of the U.S. with that in foreign countries.

[Ron Katznelson]

Malcom Mooney,
I wish you would check your facts before making sweeping pronouncements. I will be the last person to "howl" when improvements at the USPTO would take place. See my critical analysis of the problems at the USPTO.
http://works.bepress.com/context/rkatznelson/article/1053/type/native/viewcontent

I suspect that on this quality issue, we agree.

[Malcolm Mooney]

" Do you believe that under FTF, (a) the number of applications will not rise? (b) the quality of applications will not decline? This is a YES/NO question."

First, when you put a question to someone in this manner, you need to make sure that your question is comprehensible.

I assume by "the number of applications" that you mean "the number of applications per year," i.e., the rate of filing.

Over the long term (five to ten years out), the answers are NO, the rate of filing will not increase, and YES, the quality of applications will not go down. As to how much of this result is due to the change from first-to-invent to first-to-file, I'm guessing the answer will be very little.

[Malcolm Mooney]

Ron "For over two centuries under this legal system, American FTI patent law has protected inventors and their investors from the “uncertainty cloud of patent rights”

How many applications were filed in 1859?

[Steve Perlman]

sky pie dk:

You asked whether US inventors could use Provisional Applications under FTF instead of relying upon FTI.

The answer is unfortunately no: A Provisional App is only as strong as it is written. In other words, if you expect it to be as strong a patent, then it needs to be as well-written as a patent. If you just sketch out an idea it will serve no purpose other than to disclose what you are working on to your competitors.

When we file Provisionals, we file what are as strong as full specifications, but not fully polished. For example, we may have some hand-drawn figures, or there may be a typo or two, awkward phrases, etc. And, of course, there are no claims. Essentially, they are claim-free patents that have not been fully proof-read.
And, typically we use them because we need to make a public disclosure (and we want to retain non-US filing rights), but didn't quite have enough time to get the patent polished in time.
But Provisionals don't save us any money. By the time we file them, 95% of patent preparation fees have been incurred.

(Once, I saw a thin Provisional come up in an Office Action. And, I wondered why the inventor bothered to file it because it was so easily overcome and established no usable priority. So, weak Provisionals exist, but they don't replace a patent at all. Indeed, I think that is why I've only ever seen one cited in an Office Action.)

So, in summary, Provisionals won't help startups and universities if the US goes from FTI to FTF. If we expect to have defensible priority under FTF, we'll need to incur the cost of a real patent filing for every invention we conceive of, whether the invention is a dead-end or not. And, that will dramatically disadvantage startups.

I don't know about how startups are doing in FTF countries, but my US-based startups (with deep patents) have been successfully closing fundraising this year at solid valuations(working on a third tranche right now). I will say that in my entire career I've never seen so much emphasis placed on our patent portfolios. In times of high uncertainty, patents give startups tangible value and make them fundable.

Steve Perlman
President & CEO
OnLive and Rearden Companies
onlive.com rearden.com

[Ron Katznelson]

Malcolm, how many applications have been filed since 1859?

[Paul F. Morgan]

Dave, I have never advised any client to wait until after test marketing an invention to file a patent application on it, under past or present statutes, as that would lose all foreign patent rights and be highly likely to lose an interference to someone else filing on it first.
But I certainly agree with your point that trying to prove that all third party disclosures before your own filing date are derrived from your inventors would be impractical or impossible for applicants, IF that is the unavoidable total effect of the proposed new 102 language.

[Actual Inventor]

Mr Mark wrote: "Still, I’m kind of surprised that no one on the peer to patent site has raised the issue of Bilski."

Well, since your brought it up here, try this claim on for size.

"Claims of US 2008301067  (A1)
What is claimed is:

1. A reality program, comprising: participants who submit business proposals to receive funding to be used to implement the proposals; a host who interacts with the participants and an audience; and a financial provider who reviews and selects at least one of the proposals, and who provides funding to the at least one participant who submitted the selected at least one proposal; wherein the selected at least one participant invests the funding to develop the selected proposal, and further wherein the selected at least one participant is tracked over time to monitor the development of the selected at least one participant's business proposal."

Now its clear such a claim won't fly under Bilski for the simple fact there is no touchable machine, or qualifying transformation. However the next dependent claims is as follows,

"2. The reality program of claim 1, wherein the program is provided on at least one of television and the internet."

Now its clear in claim two, the invention involves the use of machines and or apparatus . The spec and drawings go into technical detail of the technology required for broadcasting a TV show or streaming it on the internet.

My question is will the PTO still reject this and similar claims under Bilski because the programs, like a stage play, can be provided without television or internet broadcast?

If not I can almost hear Donald Trump running interference now since his Apprentice show has run this very plot/concept many many times. Although for the PTO the latter would be more of a 102-103 issue.

On the other hand if such claims do start to get past the Bilski 101 gate then the entire issue of patenting copyrightable material gets new life, and we all know that means software patents will surely reap the benefit.

[MaxDrei]

How nice to have a civilised discussion, Dr Katznelson. Thank you. Only sorry I have so little time to go into the stats as thoroughly as you have done. So, I take your 26% on trust and will now try to guess why 26% of all EPO first filings fail, before the EPO issues a search report. Here goes.

When one files, one can pay the search fee up to 13 months later. The search fee is high, but the filing fee is not, and a lot can happen during those 13 months. As readers keep on saying, non-USA apps are typically much shorter than US filings, despite the savage sufficiency requirements of FtF, so filing an effective and sufficient app is relatively cheap in Europe. So, there is a host of circumstances when filing is a good idea at the time, but is not pursued thereafter.

One would be when I file, then sell to an entrepreneur, who then follows up by filing professionally within a year, claiming the priority date of my amateur thin-ish first filing. Of your 26%, I wonder how many die without having given rise to a prio date claimed in some other, later-filed app, at the EPO or PCT. Do you know? And even if it's more or less all the 26%, so what? I don't see it as a negative feature of a patent system. After all, the EPO took the filing fee, then did nothing more than issue a filing receipt, while the inventor and the entrepreneur were busy doing a lucrative deal.

And it happens. Doctors in Europe are inventive, and it is the US medical device corporations who are most astute at acquiring such doctor-invented technology.

The EPO didn't search, examine or even publish, until the US corporation took over. Where's the harm? I'm not prejudiced against FtF, but I see a lot of writers inside the USA that are.

[Ron Katznelson]

MaxDrei,
Yes, lets have a civilized and non-evasive discussion. I did not ask why 26% of applications drop out. I know why they drop out. Let me remind you what this discussion is all about:

Application drop out prior to Search Report:
When filing date determines priority (filed “under the FTF gun”): 26%
When filing date does not determine priority (no “FTF gun”): 2.6%

The question was: Can you explain the factor of ten in abandonment rate?

Application drop out prior to examination:
When filing date determines priority (filed “under the FTF gun”): 32%
When filing date does not determine priority (no “FTF gun”): 9.5%

The question was: Can you explain the factor of three in abandonment rate?

Does this not prove that FTF results in a lot more applications having lower *relevant quality* that are ultimately useless to their owners? Is it not reasonable to conclude that a similar effect would take place in the U.S. under FTF? This is not rocket science, is it?

You are correct that the EPO is not harmed by either types of applications. The EPO has a deferred examination system wherein applicants pay for each phase as they go and therefore withdraw low “relevant quality” applications as soon as they learn new adverse facts. Not so at the USPTO. All fees including search and examination fees are paid upfront because examination is automatic. Applicants have very little incentive to abandon applications. There is no pre-examination disposal mechanism here. Unlike the EPO, the USPTO will begin examining all the low “relevant quality” applications Under FTF. That is what we mean by ‘flood” of applications at the USPTO. Read our letter for more details on how the drafters of S. 515 have neglected to even think about “the complements” that must accompany the FTF system.

You ask “where is the harm?”. For reasons explained in our letter and my posts above, U.S. applicants will be harmed by FTF. Have you actually read the letter linked above?

[MaxDrei]

Ah, so there's the point of difference between us. As usual, I'm arguing about how the law might be, while you argue how it IS. I bridle at assertions that First to File, as such, causes the sky to fall. Actually, I suspect that we agree, that the special embodiment of "F2F", in the present House or Senate Bill, is definitely not "best mode" but, instead, a bast@rdised, mish-mashed dog's breakfast, no good to man nor beast, which will indeed bring down the sky.

Now I'll have to read your letter, to see why the flood of apps that is going to overwhelm the PTO isn't going to materialise as a flood of provisionals (like in Europe). I want to learn, but I have other things to do, and I'm getting quite a lot from this conversation, even while doing other things. I don't mean to treat your letter with disrespect: I did read something of yours some weeks ago, but the link above seems to take me to something else, more colourful than the B&W thing I printed out all those weeks ago.

[Paul F. Morgan]

There have been some unusually good arguments above both for and against the U.S. joining the rest of the world with a first inventor to file system, and/or unintended consequences.
However, one is not. As to the lower EPO early application abandonment statistics for U.S. [parent application] based EPO applications, it is important to note that (1) most of these are filed by major U.S. companies which simply do not do "abandonment reviews" at that early stage, and (2) they were already filed on a de facto "first to file" basis [NOT a FTI assumption] in order to preserve foriegn patent rights.

[Babel Boy]

Steve Perlman: "If you just sketch out an idea it will serve no purpose other than to disclose what you are working on to your competitors."

I'm not sure Steve knows how PPA's work. They aren't disclosed to anyone unless referenced by a regular patent application (RPA), and only then not until publication. But the RPA discloses, or should disclose, what's in the PPA anyway. So where's the damaging disclosure by PPA?

BTW, if you are spending 95% of your patent cost by drafting the PPA, either your lawyers are taking you for a ride or your claims are real stinky. I would estimate 50% of the time for drafting an RPA is claims.

The PPA has to be an enabling disclosure. That's essentially all. The problems with PPAs have been due to non-enablement. OK, so what's the problem? Draft an enabling disclosure and spend $100 to file it.

And under FTF, so long as it's enabling, all the patent rights now go to the filer. That is very, very powerful -- mostly for the small inventor. The PPA also allows you to turn everything you have into intrinsic evidence, including a hand-drawn picture of the kitchen sink.

In FtF, if the invention is worth protecting, then draft an enabling disclosure and file it as PPA. Then do all the public or private disclosing you have to do. You are filed and you are in control of the rights to the invention -- you are bullet-proof without worrying about who is going to backdate their lab-books after you disclose the invention to them.

FTF within the context of 1) PPA, 2) deferred examination, and 3) strong prior use rights is a far, far better system for the small inventor than FTI. The small inventor wants to sell his idea as early as possible, but under FTI he can't do that without cutting his own throat. Under FTI once he has filed an enabling PPA, that invention is his and he can shop the invention around without worrying about the rip off.

As far as the grace period -- I agree with the Megley paper -- the grace period doesn't work with FtF. Forget the grace period in FtF -- the PPA is your grace period. Keep your mouth shut until you file the enabling PPA.

My bottom line is: Anybody arguing against FTF outside of the context of PPAs is off on a different planet.

[Noise above Law]

Babel Boy,

You are babbling and you obviously have NOT read Dr. Katznelson's work. If you had, you would see that every argument you have just used is refuted. It's nice to have opinions, but please, keep up so that your opinions can be on point and you would not appear to be so uninformed.

After reading, perhaps you and MaxDrei can come back to this planet and this country and join in the discussion of what is actually pertinent instead of making noise.

[Lieutenant Dangle]

Ron K:
"Cloaking the proposed changes in § 102 as directed towards eliminating 70 interferences per year out of 460,000 applications is just a smoke screen.

Based on USPTO data, 3%-5% of applicants end up filing Rule 131 affidavits swearing behind a cited reference. Under “new § 102” with the current application filing rate, at least 14,000-23,000 applicants every year will be barred at the outset from obtaining a patent, relative to those that can obtain patents under current law."

This logic fails spectacularly. Not being able to swear behind a reference will not bar an applicant at the outset from obtaining a patent. You assume that the entire 3%-5% of applicants will just give up and abandon the case when faced with what is currently an intervening reference. The vast majority of applicants will amend their claims to get around the reference, thereby obtaining the claim scope to which they are entitled under first-to-file. They are free to amend their claims, or to pursue a different aspect of their invention. Using your logic, anyone getting any rejection in the first action would currently be barred at the outset from obtaining a patent.

[MaxDrei]

So, now I've skimmed through the doc on the link above from Dr Katznelson, and thought about the Perlman conbtributions, I guess FtI vs FtF comes down to the questions a) whether entrepreneur Perlman's business would have been less successful, had he been operating in a FtF jurisdiction, and if so (which I don't believe) b) whether what's good for Mr Perlman is good for America.

Patent applications that emerge, for the first time, many years after conception, I would call "submarine patents". I can see that submarine patents (FtI) are good for inventors like Mr Lemelson. I see that submarine patents have a chilling effect on investment in innovative manufacturing industry. More difficult is the question whether a systemic encouragement of submarine patents will, in aggregate, create more new product lines. So too the question whether a switch to FtI will have, in aggregate, a chilling effect on inventive activity.

Anyway, now I have looked at the Katznelson link, I see (apologies Dr Katznelson), that your beef is against FtF as such, regardless how it is implemented.

[Ron Katznelson]

Lieutenant Dangle: “Not being able to swear behind a reference will not bar an applicant at the outset from obtaining a patent. You assume that the entire 3%-5% of applicants will just give up and abandon the case when faced with what is currently an intervening reference. The vast majority of applicants will amend their claims to get around the reference, thereby obtaining the claim scope to which they are entitled under first-to-file”.

Lt. Dangle, before you concluded that “this logic fails spectacularly”, have you actually seen *data* that shows the stage of prosecution in which applicants actually invoke their Rule 131 right to antedate a reference? Of course applicants will first amend their claims to get around the reference, as you suggest. They are already doing that. In all the sample Rule 131 affidavits I have seen on PAIR (admittedly a number too small for declaring definite statistical significance), *none* were filed before a second office action. It makes sense, no? After all, would you advise your client to use Rule 131 unless absolutely necessary to sustain a claim they absolutely need and are entitled to? Decisions to file Rule 131 affidavits are not taken lightly. These declarations (appropriately) require evidentiary corroboration of inventor testimony regarding reduction to practice [Slip Track Systems, Inc. v. Metal-Lite, Inc., 304 F.3d 1256, 1266 (Fed. Cir. 2002)], which would be subject to further challenge in any subsequent patent dispute.

Are there cases where such affidavits are suspect? Yes, as in any proceeding, and when and if it matters in a dispute, they are appropriately vetted. Are there more of these Rule 131 declarations filed than is warranted? Probably, as Lionel Hutz attests above: “131 affidavits have offered me an easy way out when a tenacious examiner insists on maintaining a superficially reasonable, but incorrect 103 rejection and the client does not want to appeal.” The point is that without invoking Rule 131, Lionel would have found himself among the growing number of applicants that are denied meritorious claims and are pushed through a costly and risky appeal process that should not have occurred (see Figure 2 of my comments to OMB on the Appeal Rules at
http://works.bepress.com/cgi/viewcontent.cgi?article=1054&context=rkatznelson, comments that I believe contributed to OMB’s decision to withhold approval of USPTO’s implementation of these draconian rules).

So you see, Lt. Dangle, we have every indication that applicants filing Rule 131 affidavits are already facing substantial risk of losing *substantive* patent rights, or prohibitive costs for securing those rights. The number of such declarations is therefore extremely relevant to the potential effects of FTF. I urge you to produce evidence to the contrary.

[Ron Katznelson]

Paul Morgan,
Thanks for sticking to substance and for providing thoughtful remarks.
You say: “As to the lower EPO early application abandonment statistics for U.S. [parent application] based EPO applications, it is important to note that (1) most of these are filed by major U.S. companies which simply do not do "abandonment reviews" at that early stage, and (2) they were already filed on a de facto "first to file" basis [NOT a FTI assumption] in order to preserve foriegn patent rights”

First, the EPO statistics I cited for both first-filings and second non-priority filings are for Euro-Direct applications only, filed directly at the EPO without going via the PCT route. Second, these non-priority applications are not only US based applications, as you surmise. I suspect that the majority of US-based applications at the EPO arrive via the PCT and are not included in these statistics. Indeed, EPO applications filed via the PCT exhibit even lower abandonment rates than those I cite for non-priority EPO-direct filings (see Lazaridis’ work from which I derived my data in Slide 9). Third, the fact that some non-priority applications rely on an earlier FTF filing date does not take away from their applicants’ ability to improve or filter those, as MaxDrei suggests. These are clearly more mature applications than first-filings “under the FTF gun”. Thus, what I show in Slide 9, is the closest one can come to an “apples to apples” comparison of applications with subject matter filed under FTF and those with subject matter that has been better developed and vetted prior to filing of that application.

Paul, can I get your candid response? Do you really believe that adopting FTF in the U.S. would not increase the number of applications per year at the USPTO and that we would not see an increase in the number of low *relevant quality* applications that will be useless to their owners? Please provide factual support for your answer.

[6]

"costly and risky appeal process that should not have occurred "

Should never have occurred. Lol, great to have you be the judge on that one. Maybe it should have occurred, who are you to say?

"Paul, can I get your candid response? Do you really believe that adopting FTF in the U.S. would not increase the number of applications per year at the USPTO and that we would not see an increase in the number of low *relevant quality* applications that will be useless to their owners? "

I don't think Paul argues with you on this front. He simply feels the benefits far outweigh the problems. Considering the $/time currently used to determine if a ref is valid or not under 102 a, b, e blah blah blah would be wiped out, it probably would outweigh the problems.

Never the less, this is hardly the time to be making such changes what with the econ n backlog n all.

[fish bones]

^ yes, adopting FTF in the U.S. would increase the number of applications per year at the USPTO and that we would see an increase in the number of low *relevant quality* applications that will be useless to their owners? "

We would also see less respect for the patent system as even fewer applications survive the patenting process and even fewer are held to be valid and infringed in litigation.

Additionally, the quality of the disclosure in the published applications and issued patents would decrease, thereby decreasing the value of the patent system as a well organized and categorized technical library, often for articles which would never otherwise be published, such as most mechanical inventions as opposed to scientific inventions.

It is a lose-lose situation.