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The world continues to turn even though several hundred thousand patent applications are sitting examined at the US Patent Office. During this multi-year delay, patent attorneys change jobs, receive promotions, raise billing rates, etc. One bottom line is that the patent professional that drafts a patent application is often not the same individual that argues the prosecution. This is a subtle problem created by the backlog.
For the following quick survey, please consider the last five USPTO office action responses that you signed. Out of those five cases, how many of the corresponding US applications did you personally draft & file? (Obviously, this poll is primarily directed to individuals that prosecute patent applications).
[Don't forget to click "Vote" after selecting your response.]
Of the patents issued thus far in 2010, more than 25% carry the baggage of a file history with at least one request for continued examination (RCE) and that rate is expected to rise. RCEs are also filed in a significant number of patent applications that are eventually abandoned.
Patent Office management sees the high RCE rate as a symptom of a breakdown in the prosecution system. In their view, after two rounds of negotiation, the parties should have arrived at final positions -- either by identifying appropriate patent-worthy claims or else by determining that no-such patentable subject matter exists. At that point, further negotiation with the same examiner makes little sense in the ordinary case. If the applicant and examiner come to an agreement then the case is concluded, otherwise the applicant appeals to a higher authority.
The Problem of RCEs: Although RCEs do generate USPTO revenue, they are troublesome because they frustrate the USPTO's goal of reducing the large backlog of 730,000+ unexamined patent applications. Furthermore, the current RCE fee of $810 ($405 for small entities) do not cover PTO expenses associated with the ongoing examination. The cost differential is made-up with maintenance and extension fees. In most of the RCE'd cases, the applicant and examiner eventually do reach an agreement without an appeal to the Board -- but only after more rounds of discussion. This re-working of applications raises costs for patent applicants, delays patent issuance, prevents work on the backlog of cases, and generally makes all the parties look silly.
No Solution Yet: Historically, the patent examiners count system provided some incentive for examiners to induce the filing of RCEs. The count system has been modified to reduce that incentive. Despite this disincentive, RCE filings do not appear to have dropped in any significant way. Another growing RCE disincentive involves patent term adjustment (PTA). The long examination backlog is leading to unprecedented PTAs that can add additional months and years to the term of a patent. Although the filing of an RCE cuts-off the ongoing accumulation of (type-B) PTA, folks are continuing to file RCEs.
Explaining why RCEs are Filed: Although not universal, the broadest independent claims of a patent application are often narrowed during prosecution. It is important to recognize, however, that the narrowing amendments typically involve the inclusion of limitations already found in dependant claims. In the negotiation context, the dependent claims begin to look like pre-set negotiable points. It obviously takes time to reach some mutual agreement between the applicant and the PTO. Perhaps the usual case does need more than two rounds. However, my sense is that the high RCE numbers persist because initial office action rejections regularly fail to directly address the claimed invention and (consequently?) necessary claim amendments are not proffered by the applicant until after the final rejection. At that point, an RCE may be required. Of course, even in the best of times RCEs are sometimes unavoidable -- such when prompted by the late discovery of important prior art. The additional time delay of RCEs may be helpful in other cases such as when limitations that distinguish the invention from the prior art are buried in the specification.
The PTO is looking for ways to reduce RCEs and more generally reduce the re-working of applications. To that end, I would like to ask two general questions that will help me create a follow-on survey:
Guest Post by Shubha Ghosh, Vilas Research Professor & Professor of Law at the University of Wisconsin Law School
A year and a half ago, the Federal Circuit threw down a gauntlet in its Bilski opinion, extensively citing Supreme Court precedent to come up with the “machine or transformation test” to determine when a process constitutes patentable subject matter. Now the Supreme Court has rejected the Federal Circuit’s conclusion that “machine or transformation” is the only test to use and provided an additional basis for why Bilski’s patent for a method of hedging risk is not patentable. In doing so, the Supreme Court has thrown back the gauntlet, leaving scholars and the Patent Bar to speculate on where the USPTO and the Federal Circuit might go with using patentable subject matter as a limit on patentability. When the smoke clears, the Bilski opinion will appear a lot like the KSR decision from 2007 and that should not be surprising since Justice Kennedy authored both.
Here are the highlights of Bilski v. Kappos.Justice Kennedy‘s opinion of the court unanimously affirmed the Federal Circuit’s ruling that Bilski’s patent should be rejected. Where the nine justices agree is that the Federal Circuit erred in distilling from precedents the “machine or transformation” test as the sole one to determine when a process is patentable subject matter. The Court based this ruling on the definition of process in Section 100 of the Patent Act and its own precedents (from the 1970’s and 1981) in Gottschalk v Benson, Parker v Flook, and Diamond v Diehr. There also was agreement that patentable subject matter is broad with limits that are finite and discernible, rather than open ended. One of these limits is no patents for abstract ideas, and there is unanimity that Bilski’s claims for methods of hedging were too abstract, describing a general process well established in the field. In short, there was unanimity in rejecting the “machine or transformation” test as the sole test for identifying a patentable process and affirming the well known exceptions from patentable subject matter: laws of nature, physical phenomenon, and abstract ideas.
In terms of method, Bilski v. Kappos reminds me of the Canadian Supreme Court’s 2002 decision in Harvard College v. Canada (Commissioner of Patents), which rejected a patent on a multicellular living organism. Both decisions relied heavily on a strict reading of the statute with the Canadian Supreme Court ruling that the word “invention” in the Canadian patent statute did not include living organisms. The Canadian Supreme Court decision, however, seemed to be sending a clear message to the Canadian Parliament to amend the statute if necessary. By contrast, it is not clear what the U.S. Supreme Court’s message is in Bilski. The opinion was a response to the Federal Circuit’s mischaracterization of Supreme Court precedent as a “machine or transformation” test. But at a deeper level, one is left wondering what guidance the Supreme Court is providing for practitioners, scholars, and policymakers. The Court throws the gauntlet back to the Federal Circuit, and presumably they will now take the new precedent and use it to mold patent practice.
The lack of clarity is reflected in part in the Justice Breyer concurrence, joined by Justice Scalia, providing four guiding principles for how to determine whether a process is patentable subject matter. The four principles are: (i) there are limits on patentable subject matter; (ii) transformation is an important “clue” to when a process is patentable subject matter: (iii) machine or transformation is not the sole test for determining when a process is patentable subject matter; and (iv) the “useful, concrete, tangible” test does not describe the full scope of what constitutes patentable subject matter. These four distill down to the principle that limits on patentable subject matter have something to do with transformation to a physical state, but that usefulness, concreteness, and tangibility do not describe the extent of patentable subject matter. Justice Breyer’s principles imply that there are limitations on “dubious” patents, such as those for “exercising a cat with a laser pointer” that have nothing to do with machine or transformation. The problem is we have no sense of what those additional limitations are.
Undoubtedly, more litigation is on the way, and perhaps the Court will hear another case involving either a medical diagnostic patent or a “dubious” patent. But the Bilski case will have immediate impact on how patents are prosecuted. After the Supreme Court’s 2007 KSR decision, patent examiners latched onto the Supreme Court’s language about “common sense” to issue obviousness rejections because a claimed combination was deemed “common sensical.” We can predict similar responses post-Bilski. The Court did not kill machine or transformation; it is now just one test. Patent examiners can still use the test as a basis for rejection. In addition, the Court’s emphasis on abstract ideas creates another basis for rejecting patents for lack of patentable subject matter.
Specifically, the Court has now revived the Gottschalk-Parker-Diehr line of cases, which were established before the creation of the Federal Circuit and which the Federal Circuit had distilled over time into the expansive “useful-concrete-tangible” approach to patentable subject matter and then into the “machine or transformation test.” In effect, the Supreme Court by reviving its precedent has negated over twenty-five years of the Federal Circuit’s attempts at doctrine. This revival opens up possibilities for examiners to rethink the relationships among process, machine, and the physical world. “Dubious” patents may be rejected because the physical phenomenon is trivial or too preemptive of the field. Patent claims might require closer connection to a machine embodiment as opposed to an abstracted, disembodied form. An interesting question to ask is whether the patent at issue in State Street would survive the analysis proposed by Bilski. On the one hand, the asset allocation method at issue is arguably as abstract as the hedging method. On the other hand, the method seems closely tied to a machine to give the process some specific limits.
Ultimately, Bilski v Kappos says more about how patent law is made in the United States than about patentable subject matter. By setting the clock back to 1982, the Supreme Court is telling the Federal Circuit to try again in devising workable rules for patent law. The Federal Circuit wrote an opinion that was goading the Supreme Court to address the issue of patentable subject matter after nearly three decades. The resulting opinion raises some fundamental and unsettled questions and, unfortunately, gives us the same, old answers.
By Ted Sichelman, University of San Diego School of Law
Before practicing law and becoming a professor, I founded and ran a small software company that sells speech recognition software to taxicab companies. After my company designed its technology, we filed for patents. Later on, when raising financing from angel and venture capital investors, they reviewed our pending applications carefully and considered them a way to stop potential competition. Indeed, in a recent survey of startup firms, the Berkeley Patent Survey—which I conducted with Robert Merges and Pamela Samuelson of UC Berkeley School of Law and Stuart Graham (now Chief Economist at the PTO)—startup executives reported that nearly 70% of venture capital firms and 50% of angel investors said that patents were important to their investment decisions. Relatively broad patentable subject matter assists startups in raising needed funds. As I have argued elsewhere, another reason for broad subject matter is that startups engage in substantial amounts of post-invention—but pre-commercialization—innovation that is not always technological in nature. For instance, many startups generate marketing, financial, legal, and other types of non-technological innovations during the costly commercialization process. Providing IP protection for these innovations not only can produce more of them, but also can help drive technology commercialization.
Assuming the Federal Circuit and the PTO do not go astray in implementing Bilski—which admittedly leaves many doors open to do so—the opinion will allow startups to continue to use patents to garner financing and will, hopefully, set an appropriate balance on the patentability of non-technological inventions. In particular, as I urged in an amicus brief with Professors Mark Lemley, Michael Risch, and Polk Wagner—Bilski rightly adheres to the 150-year old tradition that as long as the claimed invention is a machine, manufacture, composition of matter, or a process, only natural phenomena, laws of nature, and abstract ideas should be excluded from eligible subject matter.
One might contend that by allowing business methods—as well as software and other “intangible” innovations—to be patented, startup firms will encounter a greater “thicket” of patents, making it more difficult for them to enter particular markets. For example, an amicus brief in Bilski filed on behalf of “entrepreneurial and consumer advocates” argued that “if the PTO is permitted to grant broad business and service process patents, small start-up businesses would face an entirely new regime of business regulation - essentially requiring businesses to request private permits to operate from their competitors who have patents, independent of whatever technology the new business uses to compete.” Justice Stevens’ echoed this view by writing in his concurrence that business methods patents “can take a particular toll on small and upstart businesses.”
In actuality, under the Federal Circuit’s previous State Street Bank opinion, in operation for a decade prior to Bilski, the PTO regularly granted “broad business and service process patents” and there is little evidence that these patent-holders required startups to license them in any significant numbers. The Berkeley Patent Survey found that only 8% of the population of respondent software companies and 12% of venture-backed software companies had licensed-in even one patent. In sum total, a relatively low percentage, 0.6% and 3%, respectively, reported licensing a patent solely to avoid a lawsuit. And while Bilski ultimately holds that business methods are not per se unpatentable, the practical effect of the outcome will be to place unapplied business methods into the precluded “abstract idea” category. If implemented properly, such an approach will ensure that startups—and, indeed, larger and more established companies—are not unnecessarily subject to overly broad patents while maintaining robust incentives to innovate.
Ted Sichelman is an Assistant Professor at the University of San Diego School of Law, where he teaches patent law and other intellectual property courses.
Joff Wild of IAM Magazine has posted a 40-minute video of a recent interview with USPTO Director David Kappos.
Some interesting points:
Lincoln National Life Insurance Co. v. Transamerica Life Insurance Co. (Fed. Cir. 2010)
It is not unusual to see insurance companies in litigation. What is unusual here is that the context is patent infringement. Lincoln is pursuing Transamerica and others for infringement of its patents covering a method of administering a variable annuity plan with a guaranteed minimum payment that continues even after an account had been exhausted. Although clearly a business method, the asserted claims do recite (in the preambles) that the method is "computerized." U.S. Patent No. 7,089,201.
A jury found the claims valid and infringed and awarded $13 million in damages. On appeal, Transamerica asked for reversal of the infringement verdict and for an opportunity to present its case on patentable subject matter. The Federal Circuit reversed on infringement.
Non-Infringement: The asserted claims require that scheduled payments be made "even if the account value is exhausted before all payments have been made." Transamerica argued that it could not infringe because (1) none of its subscribers had ever "exhausted" their accounts and (2) that its computer system has not been configured to automatically pay on an exhausted account.
On appeal, the Federal Circuit agreed with the patentee that the claim did not require that any accounts actually be exhausted. Rather, the claim only requires a particular action if the accounts are exhausted.
On the second point, however, the Federal Circuit agreed with the accused infringer — finding that "nothing in the record" shows that Transamerica uses a computer system to make scheduled payments once an account has been exhausted.
Legal Obligation to Infringe: As an interesting tid-bit, Transamerica's contracts apparently do required the company to continue making scheduled payments even after its accounts had been exhausted. The Federal Circuit rejected the legal obligation as proof of infringement — holding instead that the claims require computer implementation of the method. Furthermore, a contractual obligation to perform a method does not constitute infringement. Rather, infringement requires performance: "A contractual obligation to perform an act is not performance; indeed, a party could avoid infringement simply by breaching its contract."
Non-Patentable Subject Matter: Based on its non-infringement holding, the Federal Circuit left the Section 101 question undecided as moot.
The USPTO is quickly moving forward with its Patent Prosecution Highway (PPH) and applicants may want to consider whether it is time to jump aboard.
The PPH is based on a series of bi-lateral (and multi-lateral) agreements between the various world patent offices. From the perspective of the patent offices, PPH provides a better avenue for sharing information and for reliance on work done by another office. The offices hope that PPH will ease their workloads and help eliminate application backlogs. For applicants, PPH appears to be a valuable mechanism for reducing both the costs and delays associated with multi-national patent protection.
To participate in PPH, an applicant must first receive a favorable action from the Office of First Filing (OFF). Upon request, participating worldwide offices will then accelerate examination of the corresponding claims. In addition to speed, applicants will benefit from examiners taking official notice that claims with the same limitations were reviewed and found patentable by another well-respected office. Preliminary studies suggest that PPH applications tend to save about one-office-action-response per country.
The USPTO has ongoing PPH agreement with Australia, Canada, Denmark, EPO, Finland, Germany, Japan (JPO), Korea (KIPO), Singapore, and the UK. [Link]
A pilot PCT-PPH project is ongoing. With the PCT-PPH, the accelerated examination is based upon a favorable PCT written opinion or international preliminary examination report. The PCT-PPH pilot is only between the USPTO and the EPO, JPO, and KIPO.
Applicants appear to have two major concerns with the use of the PPH. First, the PPH claims must directly correspond with those allowed in the Office of First Filing. Although technical amendments are OK, an the particular claims obtained in one country might not correspond to those obtained in another country. Second, the PPH appears to be quite high-speed. Thus, applicants seeking delay might be shocked.
I took a sample of 6,600 published patent applications whose prosecution files each included an initial non-final office action rejection and a response to that action that was submitted sometime between January 1, 2008 – June 10, 2010. Based on the dates of the office action and response, I created the histogram shown above. (Note, the histogram is corrected for due-date shifts caused by weekends and holidays). The data is an improvement on what I presented in 2008. [Link]
As the chart show, patent applicant responses are extremely deadline driven. A typical non-final office action allows three-months to respond, but that deadline can be extended for up to three more months (for a fee). The current extension fees are $130, $490, and $1,100 for one, two, and three month extensions respectively. That fee is cut in half for qualified “small entities.” About 2/3 of applicants respond within the original three-month deadline. An additional legal reason to meet the original three-month deadline is that it preserves potential patent term adjustment (PTA) created by patent office delays. PTA is reduced by one-day for each day of applicant delay beyond the three month date.
Hitting the Deadline: More than 26% of the responses were filed on the exact day of the three month deadline. For applicants that missed that date, 70% filed their responses within four-days of a deadline.
Compact Prosecution: One problem with long delays is that information regarding the invention, the business needs, and the prior art, and the attorney-examiner relationship all become stale in the course of three months. Although this staleness is difficult to quantify, I did look at patent grant rate as a function of the timing of responses. In my study, I found a clear and significant negative correlation between grant rate and delay in responding to the non-final office action. I.e., longer delays are associated with a lower grant rate. (Here, grant rate is calculated as the number of patents issued divided by sum of the number of patents issued and applications abandoned). The chart below groups applications according to the earliest deadline met in their first OA response and reports the grant rate for each group.
Satisfied With Delay: A delay in applicant response more-likely-than-not will delay the eventual issuance of the patent. These figures show that most applicants are not troubled by that delay. On that note, I found that applicants that claim priority to a provisional application tend to have longer delays in responding to office actions. That is not surprising since the filing of the provisional already indicates that the applicant is comfortable with delay. As might be expected, applications relating to Biotechnology and Organic Chemistry (TC 1600) tend to have a longer delay as well.
Yangaroo v. Destiny Media Tech (E.D. Wisc. 2010)
In an interesting trans-national infringement case, Judge Griesbach awarded summary judgment of non-infringement in favor of the accused infringer. The court held that the Canadian-based defendant's actions did not qualify as infringement under Section 271(g)'s proscription against importation-of-a-product-made-by-a-patented-process.
35 USC 271(g): Whoever without authority imports into the United States or offers to sell, sells, or uses within the United States a product which is made by a process patented in the United States shall be liable as an infringer. . .
The asserted patent claims a particular method of distributing a content file over a network. After a series of steps, recipient terminals are provided with access to the content file. The accused infringer (Destiny) distributes encrypted music files using a method that (arguably) would infringe the patent under 271(a) if it had been performed within the US. The focal-point of the 271(g) dispute here was on whether the digital music files could be considered “products” within the meaning of 271(g).
Some prior cases:
Present Decision: In Yangaroo, the court distinguished CNet and Ormco by holding that the distributed music file was not a “product” of the method because the music file was not created by the claimed process.
Notes:
Former PTO Director Jon Dudas has taken an interesting new job as President of the non-profit organization FIRST (For Inspiration and Recognition of Science and Technology) (www.usfirst.org). FIRST was originally founded by Dean Kamen and has the goal of helping youth find inspiration and career pathways in science, technology and engineering.
More than 200,000 students competed in FIRST robotics and technology competitions in the past year. Kamen sees these technology initiatives as an alternative to sports. Kamen: “Not every kid wants to be a professional engineer, but they deserve the opportunity to get a taste of the world of science, engineering, technology and problem-solving. It ought to be at least as accessible to every kid as any sport. . . . Bounce, bounce, throw' is a nice thing to get good at, but it's not going to change security, healthcare environmental issues, or quality of life.”
Jon Dudas has been a partner at Foley & Lardner since leaving the PTO in early 2009.
A Patently-O reader asked a question about the timing of a patent’s issuance and whether the date of issue-fee payment affects the issue date. i.e., whether “the patent will issue on the same day regardless of whether the issue fee is paid immediately after receiving the notice of allowance or waiting until the statutory deadline to pay. Any thoughts?”
To answer this question, I pulled-up the file histories for 630 patents issued on June 8, 2010 and created a table comparing the respective dates of (1) the notice of allowance, (2) payment of the issue fee, and (3) issuance of the patent. I limited the sample to include only payments made within the statutory three-month window. Some file histories included multiple notices of allowance. For those, I only looked at the last-mailed notice.
Answer: As the charts shows below, the timing of issuance is closely correlated with timing of the payment of the issue fee. In my sample, 88% of the patents issued within 6–8 weeks of payment of the issue fee. Those that took longer were, for the most part, associated with older applications. In addition, the delay was greater for applicants that waited until the deadline to pay the issue fee.
The second chart shows a histogram of delay from the payment of the issue fee until patent issuance. Most patents issue in the sixth-week after payment.
The final chart shows patent applicant delay in payment of the issue fee. The chart was created by comparing the date of issue fee payment to the three-month payment deadline. More than 50% of applicants waited until the the week of the deadline to pay their issue fee. Why the delay?
The USPTO issues patents each Tuesday morning at 12:01 am. In the past several weeks, I have reported on the rising number of patents being issued each week. The past seven-weeks rank as the top-seven weeks of all time in terms of the number of utility patents issued.
Policies and Procedures: Over the past year, the PTO has increased its weekly patent grant count by more than 30%. During that time, the PTO did not increase its budget or hire a significant number of patent examiners. The difference appears to come from two avenues: (1) changes in PTO policies and procedures that provide patent examiners more opportunity to find patentable claims and (2) changes in patent applicant behavior in favor of accepting narrower claims.
The Backlog: The rising number of grants is at least slowing the growth of the application backlog. However, it does not appear to be sufficient to actually shrink the backlog. About 8,750 utility applications are filed each week -- a figure greater than the average weekly final disposals (issued patents + abandoned applications). Using the increased grant-count and a 60% allowance rate, I calculate about 7,600 such final disposals each week.
Haemonetics v. Baxter Healthcare (Fed. Cir. 2010)
This decision is important for its endorsement of the claim construction canon that the internal logic and grammar of an individual claim takes primacy over inter-claim consistency.
Haemonetics’ asserted claim was directed to: 16. A centrifugal unit comprising a centrifugal component and a plurality of tubes . . . with the centrifugal unit having a radius between 25 and 50 mm and a height between 75 and 125% of the radius.
The preamble of Claim 16 clearly indicates that the centrifugal unit includes both a centrifugal component a plurality of tubes. However, other claims and the specification indicate that the centrifugal unit did not include the tubes.
On appeal, the Federal Circuit held that the clarity of Claim 16 controlled the term’s construction for that claim. Regardless of its use elsewhere, in claim 16, the centrifugal unit includes the tubes.
[C]laim 16’s beginning and, in our view, controlling language could hardly be clearer. Claim 16 states: “A centrifugal unit comprising a centrifugal component and a plurality of tubes . . . .” It does not merely state the intended field of use in a preamble, as Haemonetics argues. Rather, it unambiguously defines “centrifugal unit” as “comprising” two structural components: a centrifugal component and a plurality of tubes. The claim then further recites, not the centrifugal component and not a centrifugal unit, but “the centrifugal unit” as “having a radius between 25 and 50 mm and a height between 75 and 125% of the radius.” Reading “the centrifugal unit” in the context of the dimensional limitations to refer exclusively to the vessel, as the district court did, ignores the antecedent basis for “the centrifugal unit,” and fails to give effect to the claim language “comprising a centrifugal component”.
. . .
The patentee’s inconsistent use of identical height and radius limitations for two different embodiments thus indicates that “the centrifugal unit” inthe context of the dimensional limitations must have different meanings in the context of different claims. (internal citations omitted)
The Massachusetts-based district court had reached the opposite conclusion. Based on the erroneous construction, the Federal Circuit vacated the jury verdict and remanded for a new application of the facts.
I used the USPTO’s new maintenance-fee data to create the charts below that show historic maintenance fee payments. The first chart might be designated a “survival rate” chart. In particular, the chart shows the percent of patents whose maintenance fees were paid at each of the the four (blue), eight (red), and twelve (green) year marks.
The graph generally shows that the rate of patent maintenance fee payments has been declining for about the past year-and-a-half.
Of the 100,000+ patents issued in 1997, fewer than 50% are still in-force.
The USPTO is in the midst of considering a new multi-track examination system that would offer patent applicants options to choose between fast-track “prioritized” examination, ordinary examination, and delayed examination. It is expected that applicants choosing the fast-track will be required to pay an additional fee while applicants choosing delay will pay a reduced application fee. Small entities would continue to pay half-price regardless of their choice. [WSJ Article by Amy Schatz]
The PTO is expected to release a request for comments later this week and to hold a public meeting this summer before implementing the program in early 2011.
The 750,000 backlog of pending patent applications is tolerated largely because so many of the pending applications relate to inventions that are not urgent. Rather, companies and inventors tend to file for patent protection well before a market develops or a marketable product exists. In those situations, applicants are not upset by PTO delay because that delay saves the company from making cash expenditures. In the short-run, the delay pushes-off potential lawyer and PTO fees. In the longer run, the delay provides an opportunity for patent applicants to cull their portfolio with either the invention or its marketability fail to be realized. Here at the University of Missouri, for instance, the usual approach is to file a lower-cost provisional patent application that is then followed by a more-costly non-provisional application once the value of the invention is more assured — this is an approach frequently followed for US-originated inventions.
Of course, with the current backlog, patent applicants are delayed regardless of whether they want delay. And sometimes it is important to quickly obtain patent protection -- perhaps to protect an emerging market or to satisfy potential investors. A major problem with the current system is that the backlog delays everyone and there is no easy mechanism to speed-up the process.
On this point, the Wall Street Journal Quoted Director Kappos: "Not every application needs to go at the same speed. Some need to go fast and some need to go more slowly. . . . By allowing applicants some control over the timing of examination, USPTO resources would be better aligned with the needs of innovators. We look forward to the public’s comments on this proposal.” In the same article, I am quoted as saying “I have some hope that the Three-Track program will be helpful.”
The fast-track The PTO believes that many of the delayed applications will be abandoned by the applicant prior to paying the fee to re-enter the examination process.
Several issues need to be worked-out before the program is implemented: [More to come…]
Based on the 18–previous patent decisions, neither of those suggestions hold much water. Namely, the argument-to-decision delay appears to be negatively correlated with the number of dissenting and/or concurring opinions. Likewise, the number of pages in the decision does not appear to have any correlation with the delay. In Therasense, the en banc Federal Circuit is poised to consider fundamental questions of the law of inequitable conduct. Some members of the court have called the doctrine’s current state a “scourge” and a “plague” on the patent system because inequitable conduct is alleged in so many patent cases.
I searched LexisNexis for federal district court and appellate decisions that mention the term “inequitable conduct” and used those results to create the time-series charts below. As the charts demonstrate, the number of decisions discussing inequitable conduct has continued to dramatically rise even after the Federal Circuit’s 1988 Kingsdown decision.
In his recent article, Professor Mammen analyzed the prevalence inequitable conduct by looking at federal court complaints (inter alia). [Read Mammen’s article] I compiled his data into the following chart that shows the dramatic rise in the percentage of patent lawsuits where inequitable conduct is pled (typically in the answer as a defense to charges of patent infringement.) Mammen article suggests that the chart below is a conservative calculation (because pleadings are difficult to find and search) and that the actual frequency of inequitable conduct allegations may reach to 60% of patent lawsuits.
The US Patent world continues to await the Supreme Court’s decision in Bilski v. Kappos. The case was argued on November 9, 2009 — 204 days ago. Professor Joe Miller (Lewis & Clark) looked at the timing of 18 other recent Supreme Court patent decisions and concludes: “if you feel like you've been waiting a long time to see the Bilski opinion, it's because you *have* been waiting a longer time than usual.”
The chart below is based on Prof. Miller’s data and reports the number of days elapsed from the oral argument to the release of the decision for each case. The average delay is about 90 days (median of 77 days). As seen in the chart, Bilski has the longest delay (and that delay continues to grow). A decision in Bilski is expected by June 28, 2010.
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