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December 14, 2007

Compact Prosecution

Unable to staff its way out of its pendency hole, USPTO management seeks to address the problem by limiting continuations and RCEs. Seeking to gratify a grotesque bias, Ayal Sharon & Yifan Liu set out to statistically validate that conclusion. Instead, they proved what many prosecutors already knew: examiners' refusal to grant deserved patents. The root of the problem is a culture now steeped in political fear of being considered slack by granting junk patents, inspired by a short-sighted and incompetent management responding to pressure from well-funded propagandists.

Hal Wegner:

The inability of Examiners to reach truly final decisions is a major cause for delays in the patenting process.

Obtusely put by Sharon & Liu in their paper "Improving Patent Examination Efficiency and Quality, An Operations Research Analysis of the USPTO, Using Queuing Theory," 17 Fed. Cir. B. J. 133, 163 (2007):

[T]he large number of non-final rejections per round of prosecution is the major cause of the backlog of applications.

The inability to reach decision is gibberish for refusal by SPEs to allow patents to be granted. That's an attitude that has flowed from on-high. After all the rule changes, and what goes down in office actions time and again in recent times, prosecutors nationwide know: the game has been rigged against patent grants. This is short-sighted because the USPTO funds itself, not through examination fees, but largely via maintenance fees. In years to come, the declining allowance rate becomes a ramping fiscal shortfall.

Sharon & Liu performed a priority queueing analysis. Lack of data forced what the authors presumed "reasonable assumptions," rendering veracity perhaps a shade better than anecdotal evidence; not to knock anecdotal evidence, as surmising to "reasonable conclusions" is appropriate to assessment of human dynamics where statistical or factor analysis falls short of holistic comprehension, as in this instance.

But the statistics, however clever the methodology, are beside the point, as are the fiscal implications related to allowance rate. The point is that the patent office is paying lip service to the hoary concept of "compact prosecution" because of innate biases and inane approaches.

MPEP 2106 is at least cogent:

It is essential that patent applicants obtain a prompt yet complete examination of their applications. Under the principles of compact prosecution, each claim should be reviewed for compliance with every statutory requirement for patentability in the initial review of the application, even if one or more claims are found to be deficient with respect to some statutory requirement. Thus, USPTO personnel should state all reasons and bases for rejecting claims in the first Office action. Deficiencies should be explained clearly, particularly when they serve as a basis for a rejection. Whenever practicable, USPTO personnel should indicate how rejections may be overcome and how problems may be resolved. A failure to follow this approach can lead to unnecessary delays in the prosecution of the application.

The patent office houses a plethora of examination subcultures, art unit by art unit. That lack of consistency itself points to a serious management problem.

Hal Wegner, from comments on his posts about Sharon & Liu's paper:

Two comments were instructive, both from patent attorneys who are former Examiners. The first (distributed earlier) said that "[t]he excessive RCEs are only prevalent in phrama and biotech art units where the examiners are pressured not to allow anything (and some proudly brag about their 0 % allowance rates in a given quarter). In the other art units, the culprit is nonfinals because the examiners do such a sloppy first search /action in a lot of cases."

Responding to this point, the second patent attorney said that ā€œ[t]oday I had lunch with an examiner who described some of his colleagues posting large ā€˜0'sā€™ on their office doors.ā€

Several comments have been exchanged concerning Examiner churning and the extreme boasts of some biotech/pharma examiners that they have been able to meet their quotas with no allowances at all: Just like the gun fighter at the OK Corral notches his belt, they post large Zeros on their doors as a badge of price.

Children playing grown-up games.

The insufferable worthlessness of the current regime at the PTO begins with the conceptual failure of patent examination 101: examination on the merits. Just grant patents that should be granted purely on the merits. Yes, examination takes time. Take the time. It can't be helped. The alternatives are worse. On the other side of the coin, reject patents that don't merit allowance, however many rounds it takes an applicant to get it through the skull; rubber-stamp "NO" on rubbish. Statistically, the causes of appeals and RCEs are unattributable, but apparent to many prosecutors to be at least as much examination failure as poor claims drafting.

Pendency is not a problem to be addressed by altering the examination regime with contrived stumbling blocks. Numerous sensible possibilities exist, but an inept USPTO has repeatedly grasped at the dumbest of measures, all aimed towards shedding examiner workload, a loathable goal.

You can't clue the clueless, and the only hope is a new administration in 2009 to oust Dudas, Doll, and Peterlin, for beginners, and hire wiser heads, on a path back to sanity in patent examination.

Postscript:

The well-funded propagandists are embodied by the Coalition for Patent Fairness, an interest group who have lobbied for years without statutory payoff to gut patent enforcement, as a means to limit infringement cost. On their web site, pointing to the increasing value of patented technology, the group insinuates a problem:

Prior to 1990 there was only one patent damage award in history larger than $100 million; over the next ten years there were 13 judgments and settlements in that category, and in the next six years there were 21, including one award for $1.35 billion - the increasing number of huge cases is readily apparent.

The pre-1990 over-$100 million award was the $973 million awarded to Polaroid from Eastman-Kodak for snitching its instant film development technology, which became ubiquitous in the consumer camera market; incredibly lucrative technology. Since then, as the economy as grown, the value of proprietary technology advances as a competitive edge has grown. That's what those figures mean, not that there has been a problem per se with patent examination.

Posted by Patent Hawk at December 14, 2007 12:08 AM | The Patent Office

Comments

As I told Mr. Dudas, and have been screaming for years, strict adherence to a low value of "actions per disposal," which is an existing statistic the PTO keeps, would not only solve the backlog problem, but also is self-regulating. No one listened. That's all I have to say about that!

Posted by: JohnG at December 14, 2007 5:26 AM

PH,

A very perspective post, one that is accord with what I've seen personally and have heard. What we have now in the PTO patent examination process is very sad and not a good situation. And you're also right, until the current PTO hierarchy is gone, nothing is going to change in that process (at least for the good). I only hope and pray that the current PTO hierarchy doesn't fatally damage this process before it leaves.

Posted by: EG at December 14, 2007 5:41 AM

The current PTO (mis)management at the PTO are masters at Orwellian Newspeak: Quality = Reject, Reject, Reject.

These people have no idea what they are doing. When faced with criticism over patents for exercising cats with laser pointers, swinging on a swing, peanut butter and jelly sandwiches, all they had to do was tell the critics: We have a re-exam procedure. If you have evidence that would present a substantial new question of patentability, submit it and let the process play itself out.

The criticism over "bad patents" that people actually care about (i.e. that have been litigated) could also have been handled in the same manner. If you don't think NTP, MercExchange, Amazon should have been issued those patents, put up your evidence or shut up. How much time and effort has been put into reviewing Amazon's "one click" patent? And now the re-exam has concluded that by adding "purchasable through a shopping cart model" to the claims, the re-exam certificate is going to issue. How on earth could anybody have expected the PTO to find this Norweigan reference that is being applied against the NTP patents in the amount of time allocated to the examiner?

PTO (mis)management would do itself a service if they simply announced: We are going to follow the law. We are going to instruct examiners to conduct a search, make factual findings and determinations supported by substantial evidence (i.e. evidence that is in the record, and can be reasonably produced by an examiner's search in the time allotted), and make sound legal conclusions that meet the preponderance of the evidence standard. If that determination is in favor of patentability, then so be it. We're not going to concern ourselves with whether some regard the applicant as a "troll" or whether applicant is one of the largest corporations in the world. We're not going to have anymore illegal meetings with groups in violation of the ex parte process. We're going to make sound legal conclusions based on substantial evidence. Period. End of story.

All they have to do is obey the law. Unfortunately, the current crop of PTO (mis)managers has demonstrated a pathological inability to follow the law. Get rid of them.

And JohnG and others are correct. More resources need to be put into classification and re-classification. If examiners are not going to be give more time to examine applications, then they have to be given assistance and help in further breaking down the art into manageable classes and subclasses so that, in the time they are alloted, they are looking at the most relevant art that can be identified. This notion that you can simply type some "key words" from claim 1 with some Boolean operators into a database containing every patent ever issued is nonsense. Searching is a skill that requires years to develop. It requires experience and the exercise of professional judgment. An understanding of that very simple concept appears to be lacking in PTO (mis)management.

Posted by: JD at December 14, 2007 6:16 AM

JD wrote:

"and make sound legal conclusions that meet the preponderance of the evidence standard."

What happend to Gartside and Zurko IV and the "substantial evidence" standard? Prior to Zurko III and Gartside it was "clearly erroneous."

I don't remember the preponderance standard being in play. Maybe for civil suits.

Posted by: BabelBoy at December 14, 2007 9:16 AM

JD writes:

More resources need to be put into classification and re-classification. If examiners are not going to be give more time to examine applications, then they have to be given assistance and help in further breaking down the art into manageable classes and subclasses so that, in the time they are alloted, they are looking at the most relevant art that can be identified. This notion that you can simply type some "key words" from claim 1 with some Boolean operators into a database containing every patent ever issued is nonsense. Searching is a skill that requires years to develop. It requires experience and the exercise of professional judgment. An understanding of that very simple concept appears to be lacking in PTO (mis)management.

You may very well be correct that improving classification and reclass would improve searching in some arts - but it is completely irrelavant for biotech and likley has been since the early 1970s (since the advent of molbiol and all its attendent technologies). In biotech you have your sequence search and/or your key words. The search resources we have are sufficient, what we need is more time, which we have no hope of getting any time soon.

Posted by: biotechexam at December 14, 2007 11:18 AM

"These people have no idea what they are doing. When faced with criticism over patents for exercising cats with laser pointers, swinging on a swing, peanut butter and jelly sandwiches, all they had to do was tell the critics: We have a re-exam procedure. If you have evidence that would present a substantial new question of patentability, submit it and let the process play itself out."

I agree.

And just because *someone* is upset about a cat exercising patent, doesn't mean that the PTO shouldn't allow a patentable biotech claim.

Reject Reject Reject.

Posted by: concerned practitioner at December 14, 2007 11:19 AM

biotechexam,

According some examiners in 1600 that I've spoken with, there is an atmosphere of "don't allow anything," or at least, don't allow much. Is that your experience?

Thanks.

Posted by: concerned practitioner at December 14, 2007 11:26 AM

I wish Jerry Massie was still around to set these PTO guys straight. RIP Jerry.

Posted by: anony at December 14, 2007 11:27 AM


As a prosecutor, my impression is that a whole lot of so-called "biotech" patents filed in the past ten years are crappy obvious or non-enabled "reach-through" garbage.

My clients who actually obtain surprising results get patents without too much difficult.

Those who insist on filing broad therapeutic claims based on mechanistic "observations" that end up being published in obscure journals that nobody cares about: they end up being disappointed.

Somehow my impression of the post above is that such disappointment is a "bad thing."

Overall, I think the PTO Examiners are doing a decent job in the biotech area. If only the examiners in the computer and software areas would do the same. Then again, that's asking a lot of folks who don't have Ph.D.s

Posted by: MM2000 at December 14, 2007 11:49 AM

BabelBoy,

PTO factual findings/determinations must be supported by substantial evidence. Zurko and In re Lee, and maybe throw in Gartside. (If the examiners cite In re Berg at you, which their new guidelines suggest they will, just throw those three back at them. Three is more than one.)

The determination of patentability is based on the entire record, by a preponderance of evidence, with due consideration to the persuasiveness of any arguments and secondary evidence. In re Oetiker, 977 F.2d 1443 (Fed. Cir. 1992).

JD

Posted by: JD at December 14, 2007 12:12 PM

concerned practitioner:

While I can't speak for the chemical only areas of 1600, my impression of the general attitude toward patentability in biotech 1600 ranges professionalism to obssesive/compulsive rejectionism.

That said, it is far far easier to allow as a primary than a junior examiner for some good reasons (with experience comes autonomy, i.e., no need for SPE conference to allow something) and some having to do more with psychology and the "count system".

For example, if you were signing the work of another, would you be more inclined to:

1. tell them to reject, reject, reject or

2. tell them lets allow but I'm trusting that you've covered all the bases as I am essentially putting my neck out to both the SPE and the quality review people based on your assurances that this thing is indeed patentable.

Since the primary generally gets no credit or recognition for the rejections (be they good or bad), and gets nothing more for an allowance except for a potential quality headache which do you think the primary will be pushing?

Posted by: biotechpatexam at December 18, 2007 2:44 PM

"Since the primary generally gets no credit or recognition for the rejections (be they good or bad), and gets nothing more for an allowance except for a potential quality headache which do you think the primary will be pushing?"

Uh, "professionalism"?

Posted by: bierbelly at December 19, 2007 11:47 AM