SKGF_Presentation_What You Need To Know About The Proposed USPTO Rule Changes And Other Reform Initiatives_2006


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SKGF_Presentation_What You Need To Know About The Proposed USPTO Rule Changes And Other Reform Initiatives_2006

  1. 1. What You Need to Know about the Proposed USPTO Rule Changes and Other Reform Initiatives Michele A. Cimbala Ph.D., Esq. 507723_1.ppt
  2. 2. USPTO Initiatives Overview • Backdrop at the USPTO • Proposed Rules Changes and Practice Recommendations • Potential Impact • Other Reform Initiatives 2
  3. 3. USPTO Initiatives Changes on the Ground Already New campus Hired 1000 new examiners in 2005 Central Re-exam Unit formed July 2005 Second-Layer Review – extended office-wide Enhanced search tools Patent Academy changes Examiner re-certification Telecommuting/Hoteling Web-based electronic filing (EFS-web) released March 16, 2006 3
  4. 4. USPTO Initiatives Changes on the Ground Already Reduced Allowance rate 58.7% Allowance rate office-wide (down from traditional 80%+ rate) 11% Allowance rate in business methods Increased Pendency But dramatic reduction in pendency for cases on appeal 4
  5. 5. Problems from PTO Perspective: • Pendency • Keeping Up with Growth • Quality • Past Solutions Failed 5
  6. 6. First Action Pendency by Art Areas Pendency Pendency High Pendency Art Areas 1 Low Pendency Art Areas 1 (months) 1640 – Immunology, Receptor/ (months) 1620 – Heterocyclic Compounds Ligands, Cytokines, Recombinant 27.7 16.9 and Uses Hormones, and Molecular Biology 1743 – Analytic Chemistry & Wave 30.8 1752 – Radiation Imagery 12.1 Energy 2123 – Simulation and Modeling, 2125 – Manufacturing Control Emulation of Computer 39.7 Systems and Chemical/ 20.0 Components Mechanical/Electrical Control 2617 – Interactive Video 2651 – Dynamic Information 50.4 16.1 Distribution Storage & Retrieval 2836 – Control Circuits 24.3 2833 – Electrical Connectors 8.8 3628 – Finance & Banking, Accounting 52.1 3612 – Land Vehicles 12.0 3731 – Surgery: Cutting, Clamping, 30.9 3723 – Tools & Metal Working 10.9 Suturing 1 “Average 1st action pendency” is the average age from filing to first action for a newly filed application, completed during October-December 2005. 6
  7. 7. Inventory by Art Examples Months of Months of High Inventory Art Areas Low Inventory Art Areas Inventory* Inventory* 1614, 1615, and 1617 – Drugs, 38-51 1620 – Organic Chemistry 15 Bio-affecting and Body Treatment 1734 – Adhesive Bonding and 1753 – Radiation Imagery 34 10 Coating Apparatus 2125 – Manufacturing Control 2127 – Computer Task 46 Systems and Chemical/ 10 Management Mechanical/Electrical Control 2611 – Interactive Video 2651, 2653 – Information 111 12 Distribution Storage and Retrieval 2836 – Control Circuits 22 2831 – Electrical Conductors 8 3620 – Business Methods 25-130 3651 – Conveying 12 3731 and 3737 – Medical 3742 – Thermal and Instruments, Diagnostic 38-47 8 Combustion Technology Equipment *The number of months it would take to reach a first action on the merits (e.g., an action addressing patentability issues) on a new application filed in July 2005 at today’s production rate. Today’s production rate means that there are no changes in production due to hiring, attrition, changes to examination processing or examination efficiencies, and that applications are taken up in the order of filing in the given art unit/area. Of course, USPTO is taking aggressive steps to ensure changes that will significantly lower the inventory rates in high-inventory art areas. 7
  8. 8. Technology Center Application Inventory 1600 1700 2100 2600 2800 3600 3700 Total* Design New Applications1 55,402 63,923 71,778 97,380 77,651 56,738 65,005 508,878 18,451 9/30/2004 New Applications1 62,644 72,697 76,529 115,585 94,425 70,354 83,225 586,580 24,534 9/30/2005 Overall Pending Applications2 95,006 105,447 102,440 138,822 137,458 101,097 108,039 809,323 27,599 9/30/2004 Overall Pending Applications2 107,647 120,767 117,728 167,721 159,687 117,045 130,168 932,300 38,104 9/30/2005 1 “New Application inventory” is the number of new applications designated or assigned to a technology center awaiting a first action. 2“Overall Pending Application inventory” is the total number of applications designated or assigned to a technology center in an active status. Includes new applications; rejected awaiting response; amended; under appeal or interference; suspended; reexams and allowed applications awaiting grant publication. *Total inventory includes applications not assigned to a particular TC, awaiting processing either pre- or post-examination. 8
  9. 9. Technology Centers Rework* Statistics FY 2002 FY 2003 FY 2004 FY 2005 TC % FAOM % FAOM % FAOM % FAOM Summary Rework Rework Rework Rework 1600 36.4% 39.7% 40.3% 42.4% 1700 25.2% 26.9% 27.1% 28.0% 2100 23.9% 24.0% 24.6% 28.2% 2600 24.8% 24.2% 24.3% 25.4% 2800 19.1% 22.0% 24.9% 24.1% 3600 17.7% 21.2% 23.2% 28.5% 3700 22.2% 25.1% 24.0% 28.1% UPR 23.2% 25.3% 26.1% 28.3% * Rework first actions are those actions that are in a Continuing (CONs and CIPs), RCE, CPA or 129(a) applications (excludes Divisionals). 9
  10. 10. USPTO Statement of the Problem Why focus on continuing applications and RCEs? Each continuing application or RCE: • Requires the USPTO to delay taking up a “new” application, thus contributing to the backlog of unexamined applications • Defeats the public notice function of the patent claims in a initial patent since it allows the possible issuance of multiple patents 10
  11. 11. USPTO Statement of the Problem When applicants are allowed to generate a string of continued examination filings from an initial application, the exchange between examiners and applicants: – becomes less beneficial and – suffers from “diminishing returns” as each of the second and subsequent continuing applications or requests for continued examination in a series is filed 11
  12. 12. USPTO Initiatives Rule Making Proposals – Limits to Continuation Practice (comments due May 3, 2006) – Limits to Claim Examination (comments due May 3, 2006) 12
  13. 13. Vision • Proposed Rule Changes goal: – free up examiner time now spent on re-work so that cases waiting for a first office action are examined sooner. • Potential undesired impact: – Increased complexity of prosecution – Increased cost – Less protection 13
  14. 14. First Notice of Proposed Rulemaking • (1) “Changes to Practice for Continuing Applications, Requests for Continued Examination Practice, and Applications containing Patentably Indistinct Claims,” 71 Fed. Reg. 48 (January 3, 2006) 14
  15. 15. (1) Continuing Examination • The revised rules require that a second (or subsequent) continued examination filing be supported by a showing as to why the amendment, argument, or evidence “could not have been” previously submitted. • The showing is in the form of a petition that the USPTO estimates would take 2 hours to prepare. (Proposed 37 C.F.R. § §1.78(d)(1)(iv) and 1.114(f)) 15
  16. 16. (1) Continuing Examination Proposed 37 C.F.R. § 1.78 • Definition: A “Continuing Application” is a continuation, divisional or continuation-in-part (CIP) application. – Applications that claim benefit of a provisional application or priority to a foreign application are excluded from the definition. 16
  17. 17. (1) Continuing Examination Proposed 37 C.F.R. § 1.78(d)(1)(i) – A nonprovisional application that is a continuation or CIP application may claim benefit of only a single prior-filed application and even then only if: – Benefit of the prior-filed application is not claimed in any other nonprovisional application other than a divisional application; and – NO request for continued examination (i.e., NO RCE) had been filed in the prior application. 17
  18. 18. (1) Continuing Examination Proposed 37 C.F.R. § 1.78(d)(1)(i) example B nonprov C nonprov ↑Con/CIP ↑Divisional only ________________________ ↑ A (nonprov/no RCE) Both B and C can claim benefit of A No showing needed for either B or C 18
  19. 19. (1) Continuing Examination Proposed 37 C.F.R. § 1.78(d)(1)(iii) example C ↑ Con/CIP B (no RCE) ↑ Div A (Restriction/Lack of Unity) Claims in B are a non-elected group from X No showing needed for either B or C 19
  20. 20. (1) Continuing Examination 37 C.F.R. § 1.78(d)(1)(i) example: two CIP’s C (claims new matter “B”) ↑ CIP B B (new matter “B”) ↑CIP A No showing needed for C if C only claims matter new in B 20
  21. 21. (1) Continuing Examination Proposed 37 C.F.R. §§ 1.78(d)(iv) and 114 example C with “showing” ↑ CIP/Con/Div/>1 RCE B B is a nonprovisional application and either - an RCE has been filed in B or - B claims benefit of another nonprovisional application C has new argument/evidence/amendment 21
  22. 22. (1) Continuing Examination Proposed 37 C.F.R. § 1.78(f)(1) – Identification Applicant must identify – in the “cross-reference to related applications” section – - all non-provisional applications/patents with benefit or filing dates within 2 months of each other - that name at least one common inventor - that are owned by the same entity 22
  23. 23. (1) Continuing Examination Proposed 37 C.F.R. § 1.78(f)(1) – Identification (cont.) • Must provide ID within 4 months of filing or of entering U.S. national phase • ID required even if the applications do not have similar subject matter. [Question: would such identification also make those applications available to the public?] 23
  24. 24. (1) Continuing Examination Proposed 37 C.F.R. § 1.78(f)(2) – Identification If circumstances under 78(f)(1) exist - And if multiple applications have the same filing/benefit date - And contain substantial overlapping disclosure - Applicant must explain how the claims are patentably distinct or submit terminal disclaimer. 24
  25. 25. (1) Continuing Examination Proposed 37 C.F.R. § 1.78(f)(2) – Identification If any other (nonprov) application has been identified as containing patentably indistinct claims, absent a sufficient explanation, the Office may require elimination of such claims from all but one of the applications. 25
  26. 26. (1) Continuing Examination Proposed 37 C.F.R. 1.114(f) • Only a single RCE may be filed per application • No RCE may be filed in any continuing application other than a divisional unless the RCE is accompanied by a petition and fee and showing as above 26
  27. 27. (1) Continuing Examination Proposed 37 C.F.R. § 1.114(f) example B C ↑Con/CIP ↑Div only ________________ ↑ A (nonprov/no RCE) Both B and C claim benefit of A You could not file an RCE (or CON) for B without petition and a showing You could file an RCE in C You could file a CON of C if there was no RCE in C 27
  28. 28. (1) Continuing Examination • Proposed changes to Rule 78 apply to any application filed on or after the effective date of the final rule. • Proposed changes to Rule 114 apply to any application in which an RCE is filed on or after the effective date of the final rule. 28
  29. 29. (1) Continuing Examination Practice recommendations (1) Review portfolios of pending applications (2) Decide whether to file a continuing application soon - to grandfather it under the current continuing application rules (3) Budget for possible grandfather filings in your 2006/2007 budget 29
  30. 30. (1) Continuing Examination Practice Recommendations (cont.) (4) Actively prosecute in PCT Chapter II in front of the US/IPEA to get another round with the U.S. examiner - interview the examiner - attempt to settle novelty/inventive step issues (Enablement/written description will only be raised in U.S. National Stage) (5) Do not use “bypass” § 371 by direct filing to enter U.S. National Stage; the § 111 application will be your one allowed continuation; must use 371 procedures 30
  31. 31. 2nd Notice of Proposed Rulemaking “Changes to Practice for the Examination of Claims in Patent Applications,” 71 Fed. Reg. 61 (January 3, 2006) 31
  32. 32. (2) Examination The USPTO proposes – to focus initial examination on claims designated by applicant as representative claims. – to defer examination of non designated claims until the application is otherwise in condition for allowance. 32
  33. 33. (2) Examination What are the “representative claims”? - all of the independent claims; and - certain designated dependent claims 33
  34. 34. (2) Examination • If the Applicant fails to expressly designate any dependent claims for initial examination, the USPTO will initially examine only the independent claims. • Even if there are 10 or fewer claims in the application, the Applicant must expressly designate dependent claims for initial examination. 34
  35. 35. (2) Examination • The mere presentation of a dependent claim is not a designation for initial examination. • A designated dependent claim (including a multiple dependent claim) must depend only from an independent claim or from another designated dependent claim. 35
  36. 36. (2) Examination Example: Claim set has 3 independent claims and 20 dependent claims. – The 3 independent claims are automatically selected for initial examination. – Applicant can designate 7 of the dependent claims. 36
  37. 37. (2) Examination • A claim that refers to a different statutory class of invention will be treated as an independent claim even if written in dependent form. 37
  38. 38. (2) Examination An “Examination Support Document” (ESD) under 37 C.F.R. 1.261 must be submitted if • There are more than 10 independent claims • Applicant desires initial examination of more than 10 claims 38
  39. 39. (2) Examination If the total number of independent claims (or independent plus designated claims) exceeds 10, and no ESD has been submitted, and it appears this was inadvertent: – Applicant will be sent a notice with a 1 month period (not extendable) to supply the ESD; – Cancel claims/rescind designation; or – Submit a suggested restriction accompanied by an election without traverse to an invention drawn to a group with fewer than 10 claims. 39
  40. 40. (2) Examination A restriction may still be required. • If election results in withdrawal of independent or designated claims, Applicants may designate additional representative claims for initial examination so long as the total of all claims does not exceed 10. 40
  41. 41. (2) Examination Markush Claims • The Office is soliciting comments on how to handle Markush claims under the new practice 41
  42. 42. (2) Examination One Markush option: Each alternative would be counted as a separate claim for examination purposes unless: – The Applicant shows that each alternative includes a common core structure AND common core property or activity, in which the common core structure constitutes a structurally distinctive portion in view of the existing prior art and is essential to the common property or activity. 42
  43. 43. (2) Examination “Examination Support Document” (ESD) must include: (1) a statement that a preexamination search was conducted, – an identification of the field of search by class and subclass – the date of the search where applicable – for database searches, the search logic or chemical structure or sequence used as a query, the name of the files searched, the database service and the date of the search 43
  44. 44. (2) Examination The preexamination search must include: • US patents and patent application publications • Foreign patent documents • Non-patent literature – Unless the applicant can justify why no references more pertinent than those already identified are likely to be found in the eliminated source 44
  45. 45. (2) Examination • The preexamination search must encompass all of the features of the independent claims and must cover all of the features of the designated dependent claims • A search report from a foreign patent office will not per se suffice – it must satisfy all of the search requirements set out in Rule 261 45
  46. 46. (2) Examination ESD requirements (cont.) (2) An IDS (3) An identification of all the limitations of the independent claims and the designated dependent claims that are disclosed by the references cited in the IDS (4) A detailed explanation of how each of the claims are patentable over the references 46
  47. 47. (2) Examination ESD requirements (cont.) (5) A concise statement of the utility of the invention as defined in each of the independent claims (6) A showing of where each limitation of the independent claims and the designated dependent claims finds written description support in the specification of the instant application and any benefit application 47
  48. 48. (2) Examination Proposed 37 C.F.R. § 1.133 • Would allow the examiner to request an interview with applicants before the first office action 48
  49. 49. (2) Examination Proposed 37 C.F.R. 1.704 • Failure to file an ESD when necessary is a circumstance that constitutes a failure to engage in reasonable efforts to conclude processing or examination of an application – thus affecting patent term adjustment. 49
  50. 50. (2) Examination The proposed examination rules would apply to – any application filed on or after the effective date of the final rule; and – to any application in which a first office action on the merits was not mailed before the effective date of the final rule. 50
  51. 51. (2) Examination • Applicants who filed before the effective date of the final rule would be allowed to submit either an ESD or a new set of claims to avoid the need for an ESD. 51
  52. 52. (2) Examination Strategy –new applications (1) Consider paying for extra groups in the PCT so that all the claims are searched and use Chapter II and the US IPEA to get an extra “round” of examination – preferably interviewing the US Examiner. (2) Consider filing multiple applications (with a terminal disclaimer); each with claims of a different scope if you have a reason why the cases should be kept separate. 52
  53. 53. (2) Examinations Strategies for New Examinations (cont.) (3) Draft claim sets now that are amenable to review under the proposed regulations. (4) Protect members of Markush groups by also having separate dependent claims to the most important members of the Markush group. 53
  54. 54. (2) Examination Recommendations – Pending Applications (1) Review portfolios for applications due for a first office action on the merits this year – work with the examiner to obtain a first office action on the merits before a final rule would take effect (maybe never but, if the rules were to be finalized, probably not until late summer at the earliest). 54
  55. 55. (2) Examinations Strategies – Pending Applications (cont.) (2) Consider “mega” interview on all members of a family of cases so as to expedite first office actions in unexamined members of that family. (3) Minimize time in OIPE by electronic filing applications likely to go to art units with little backlog (E-file using the new EFS-Web – general release date March 17th). 55
  56. 56. A Shooting Gallery for Patents • Consider a world in which these rules were made final, and also post-grant oppositions were allowed. • One could oppose an issued patent knowing that the patentee probably had no continuation application on file to act as a safety net. • The patentee would be pressured to take only the most narrow of claims to survive opposition – much more so than if the patentee had a “safety net” continuation application on file. 56
  57. 57. Final Rulemaking Implementation John Doll: Expects final rulemaking in about 4 months (around September) There will be a 30-60 day (and maybe a 90 day) period before the final rule takes effect. 57
  58. 58. Possible Compromises • Retain current divisional practice (i.e., where it is not required to file all divisionals off the application in which the restriction was made • Retain unrestricted RCE practice and allow 2 Con/CIP before a petition is needed • Expand ability of 3rd party submissions • Examine all claims but increase excess claim fees 58
  59. 59. Other Potential USPTO Options • Examination options: – Deferred examination (up to 3 years) – Accelerated examination (allowance in 12 months) – Suite of options for examination with varying levels of examination and enforcement rights • Pre-Grant Opposition Pilot Program • Increase fees for successive continuations/RCEs • Community Patent Review • Permit applicant requested pre-first office action interview 59
  60. 60. * Credits: Several slides and statistical data are taken from presentations by John Doll and James Toupin of USPTO and made available to the public in February 2006. 60
  61. 61. THANK YOU! Michele A. Cimbala, Ph.D., Esq. 61