August 4, 2009
Jorge Tayler was mistakenly $10 short on his patent maintenance fee payment. The USPTO later declared his patent dead because of it, in violation of its own rulebook, the MPEP. "The PTO was arbitrary and capricious in its failure to notify Mr. Taylor of the minor insufficiencies in his attempted payment of a patent maintenance fee," so ruled the CAFC (2009-1133). The patent office does this sort of thing habitually: taking fees and then unreasonably denying the action for which the fee was paid, as well as refusing refund.
Posted by Patent Hawk at August 4, 2009 10:05 PM | The Patent Office
The solicitor's office bested by a pro se? A self proclaimed pauper?
It certainly has been a banner week for the PTO at the Fed. Cir.
Posted by: JohnDarling at August 5, 2009 3:17 AM
I think it is a disgrace that the Solicitor's office even took up this case.
Mr. Taylor clearly satisfied the maintenance fee statute (35 USC 41) by paying the $975 maintenance fee. He was $10 short on the surcharge, which is governed by RULE ONLY (37 CFR 1.20(h)). The Rule could have (and should have) been easily waived by the PTO sua sponte in this situation - see 37 CFR 104.3. (That said, Mr. Taylor should not have waited till the last day of the grace period to pay, and if he felt the need to wait so long he should have included a certificate of mailing, though the PTO by procedure likely retained the postmarked envelope as evidence.)
But I do like the Solicitor's positively devilish fallback argument - that Mr. Taylor also hadn't paid the 11.5 year fee - you know, the one the PTO would not let him pay because they deemed the patent expired after cashing his check - so the faulty payment of the 7.5 year fee could not be remedied or overlooked, even if the PTO wanted to.
"The USPTO notes that even if the failure to properly pay the 7.5-year
maintenance fee could be overlooked, Mr. Taylor has now also failed to
pay the 11.5 year maintenance fee, and has also missed the deadline for
reinstatement based on 'unintentional delay' of that payment. Thus, any
petition for reinstatement of his patent at this point would have to establish
unavoidable delay for his failure to pay that maintenance fee as well."
Wow. I just hope Mr. Kappos will re-establish some weight of justice at the Solicitor's office.
The winning pro se argument, from the brief:
"1) You never billed me, but told me over the phone that my fee was
$1030.00. I paid you that much.
2) You cashed my check, pocketed my $1030.00 and expired my patent
for lack of payment. You then never informed me otherwise. I also have
proof that I paid this amount of $1030.00. You kept me in the dark over a
$10.00 discrepancy for over 3 years so that you could keep the $1030.00
and expire my patent, without my knowledge, for lack of payment. If I did
not pay the fee why would you cash my check? How convenient, like a
thieve [sic] in the night, never informed me of your malfeasant [sic]. If
there were any discrepancies as to the fee owed and the fee paid, you
should have made me aware so that the transaction could have been
Well done, Mr. Taylor. The government serves (or should serve) the people, not itself. And it should administer justice in equity.
NOTE: As a side note, I've always wondered why the PTO does not bill maintenance fees. That should change too, and I bet it would help the budget shortfall as well - this really isn't rocket science.
Posted by: niRPa at August 5, 2009 4:54 AM
Oops, correct cite for waiver of rules is 1.183.
Posted by: niRPa at August 5, 2009 5:16 AM
"I think it is a disgrace that the Solicitor's office even took up this case."
At this point, nothing they do should come as a surprise to any of us.
Posted by: JohnDarling at August 5, 2009 5:27 AM
Yeah, I know JD, unfortunately. But the fact they don't know the law and/or the PTO's own legal procedures is still disheartening. I bet few of them know, or even cared about up to this time, the MPEP.
Attorneys - study the MPEP: this case says it can and will cut both ways.
"Although the MPEP “does not have the force of law,” Ethicon, Inc. v. Quigg, 849
F.2d 1422, 1425 (Fed. Cir. 1988), it “has been held to describe procedures on which the
public can rely.” Patlex Corp. v. Mossinghoff, 758 F.2d 594, 606 (Fed. Cir. 1985)."
Posted by: niRPa at August 5, 2009 5:41 AM
The most disheartening aspect of this case is it highlights very cleary the attitude of the PTO, which is: If applicant screws up, then applicant has to live with the consequences, if we screw up, hey, too bad, we're the PTO, we don't ever have to correct our mistakes.
It's beyond disgraceful.
Posted by: JohnDarling at August 5, 2009 6:13 AM
Thanks JD and niRPA,
This and In Re McNeil-PPC, Inc., 2008-1546, are mere symptoms of the larger problem many of us have been railing about.
While I will not hold my breadth in the hope that the object lesson of the Office's runaway desire to be a Law unto itself will be understood by those who matter (and much less by those who consider Law to be lawlol), I do offer my best wishes to Mr. Kappos and Mr. Godici.
Posted by: Noise above Law at August 5, 2009 6:18 AM
Unfortunately, this is precisely the sort of stories one expects when numb-nuts pro se meets a-hole bureaucracy. It's just very fortunate for this guy that the CAFC is very pro se friendly and bends over backwards to help the pro se litigant. Courts exercising equity powers almost always warms the cockles of my heart.
I feel for this guy. After 10 years of practicing, I still see the PTO petition process as a huge black-hole, designed with the primary goal of screwing applicants out of their due process rights. Just peruse MPEP 1002 and see how 200 different people are responsible for handling petitions.
CAFC notes in this case that the PTO's internal operating procedure is that decisions on petitions are non-final. MPEP 1002.02 says they are interlocutory decisions. So how do you get review?
For instance, you get one of those brain-dead restriction requirements, you traverse, you petition, and you lose. [I know, I know -- the excepted "wisdom" is that nobody petitions because it's cheaper to file the divisional. But not after you double prosecution costs and maintenance fees. Besides, this is just an example.]
Anyway, how and at what point does one effectuate a judicial review of the denied petition?
Petitions never stop the clock, so how does one get a judicial review before the divisional has to be filed?
What happens after the parent patent issues and the courts finally say restriction was not proper? Does the PTO have to publish a new patent with your non-elected claims added? Ha!
Posted by: Veritas at August 5, 2009 7:56 AM
"Anyway, how and at what point does one effectuate a judicial review of the denied petition?"
From my discussions with the staff over at OPLA, if your petition is denied, you must request reconsideration, and if that is denied, that is a final agency decision from which you can bring suit under the APA.
BTW, I have petitioned restriction requirements and had them withdrawn. But you are correct, it's easier, unfortunately, simply to file the divisional (though paying double filing fees, issue fees, and maintenance fees is a problem).
Posted by: JohnDarling at August 5, 2009 8:35 AM
As bad as I thought. Even in the rocket docket E.Va., the petition issues will be moot before the first motion is heard. Without provisions to stay prosecution pending review, most of these decisions on petition are de facto denials of due process.
BTW, my understanding is that a final restriction must be entered before a divisional or petition can be filed. I recently had an examiner who refused to enter a final restriction, saying it wasn't necessary because I made an election (with traverse). The examiner merely canceled non-elected claims with an examiner's amendment and allowed the elected claims.
My reading of the regs was that because my traverse was never answered with a final restriction, I had no basis for a petition or divisional. I had to go to her supervisor for help.
Posted by: Veritas at August 5, 2009 9:33 AM
"BTW, my understanding is that a final restriction must be entered before a divisional or petition can be filed."
I am not aware of any rule or authority that requires a restriction requirement be made final in order for a divisional to be filed. If you are, please let me know.
Rule 144 does require that the restriction requirement be made final before you can petition. However, if the examiner refuses or forgets to make the requirement final, you are required to petition the requirement no later than appeal, per Rule 144. In that case, if you are appealing but the requirement was never made final, you can request that the requirement of Rule 144 (that the restriction requirement was made final) be waived. I've done that and it's worked.
Had the situation you described. Examiner cancelled my non-elected (with traverse) claims without my permission and issued a notice of allowance. Also cancelled a claim that was elected. Again, without my permission.
He was sorry after I filed my petition. The case was 09/516,177. There's no IFW, but if you want a copy of the petitition decision, let me know and I'll e-mail you a copy.
It's fun reading.
Posted by: JohnDarling at August 5, 2009 10:20 AM
LOL is right John. What asswipes! I want to punch them all.
Posted by: John at August 5, 2009 12:36 PM
"As bad as I thought. Even in the rocket docket E.Va., the petition issues will be moot before the first motion is heard. Without provisions to stay prosecution pending review, most of these decisions on petition are de facto denials of due process."
Not really, you can file RCE's until your case gets heard.
"I recently had an examiner who refused to enter a final restriction, saying it wasn't necessary because I made an election (with traverse). "
That is when it is necessary.
The restriction mess is all a big jumble of bs, stat revision is needed.
Posted by: 6000 at August 5, 2009 12:50 PM
"Mr. Taylor sought redress in the amount of $1 billion, his estimation of the worth of his intellectual property “in the U.S. and world market.”"
Man, this whole decision is full of lulz.
He petitioned in forma pauperis in order to be able to pay 4 grand to keep his patent going? COME ON.
Posted by: 6000 at August 5, 2009 1:12 PM
"The restriction mess is all a big jumble of bs, stat revision is needed."
No revisions needed. Just some education of the examiners by people who actually understand section 121, i.e. by somebody not currently working at the PTO.
Posted by: JohnDarling at August 5, 2009 1:14 PM
Hal Wegner of Foley & Lardner was upset about the PTO's behavior too. But F&L hired the bozo directly responsible for this kind of behavior in recent years, viz. Jon Dudas, and has been parading him around at various conferences as if this adds luster to the firm's reputation. Me, I think it just tarnishes it.
Posted by: Federally Circuitous at August 5, 2009 1:52 PM
Either way you look at it Jon is still a great guy in person. He may or may not have been the best director evar, but he did what he could.
Posted by: 6000 at August 5, 2009 3:43 PM
"He may or may not have been the best director evar, but he did what he could."
Posted by: JohnDarling at August 5, 2009 5:17 PM
I have received more restriction/election requirements in the past three years than in the previous twenty.
Posted by: John Prosecutor at August 5, 2009 9:13 PM
I applaud Chief Judge Michel and Judges Lourie and Rader for not only chastising the PTO for its callous, grossly unfair and nonsensical treatment of this poor pro se patentee, but for coming up with an elegant and equtiable remedy. I suspect that the PTO thought it could gloss over its "arbitrary and capricious" behavior by simply entangling this poor pro se patentee in a web from which he couldn't excape with his patent intact, and to get the courts to go along with this charade. Surprise! The response by the PTO is also startingly given that the PTO (especially the Examiners) tend to treat pro se applicants with a much "kinder and gentler" approach.
Posted by: EG at August 6, 2009 6:17 AM
Thanks, 6000 and JD for your tips on dealing with the petitions.
You ought to team up and write a good prosecutors' guide to handling problems, like getting petitions reviewed, that aren't adequately addressed by MPEP or existing manuals.
BTW, I know you can petition for deferral of examination for 3 years if examination hasn't begun yet. But I think you can also ask that prosecution be suspended for cause. Has anyone tried that in order to get time to have a court look at a petition denial?
Posted by: Veritas at August 6, 2009 7:52 AM
"Either way you look at it Jon is still a great guy in person. He may or may not have been the best director evar, but he did what he could."
What he could to: (a) increase the backlog, (b) occupy, distract and anger practitioners with the proposed new rules, (c) increase contention between practitioners and examiners, etc., etc.
Posted by: John Prosecutor at August 6, 2009 11:20 AM