Source: http://271patent.blogspot.com/2009/
Timestamp: 2019-04-18 18:41:58+00:00

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The conference also includes a "View from the Bench" session that includes ITC Chief Administrative Law Judge Paul J. Luckern and ITC Judges Theodore R. Essex and Robert K. Rogers.
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The UK is introducing a "patent box" regime that will impose a lower rate of corporate tax on patent income as an attempt to boost to Britain's creative industries. The government has yet to release details of how the scheme will operate, although Chancellor of the Exchequer Alistair Darling confirmed in his pre-budget speech to the House of Commons on December 9 that patent income (e.g., royalites) will be subject to a 10% rate of corporate tax after legislation is passed. This would represent more than a 50% cut.
Before passing any legislation, the government intends to consult with industry, and final legislative proposals are unlikely to emerge until the 2011 Finance Bill. The program is scheduled to be put in effect after April 2013.
It didn't take long for Glaxo to announce that it expected to spend some 500 million pounds building a new factory to make biotech drugs and on expanding an existing plant to make next-generation respiratory medicines.
As part of this effort to improve the quality of the overall patent examination and prosecution process, to reduce patent application pendency, and to ensure that granted patents are valid and provide clear notice, the USPTO would like to focus, inter alia, on improving the process for obtaining the best prior art, preparation of the initial application, and examination and prosecution of the application. The USPTO is seeking public comment directed to this focus with respect to methods that may be employed by applicants and the USPTO to enhance the quality of issued patents, to identify appropriate indicia of quality, and to establish metrics for the measurement of the indicia. This notice is not directed to patent law statutory change or substantive new rules. It is directed to the shared responsibility of the USPTO and the public for improving quality and reducing pendency within the existing statutory and regulatory framework.
(c) which provides sufficiently clear notice to the public as to what is protected by the claims.
Notably, the term ‘‘quality patent’’ does not include the economic value of the resulting patent.
Category 5—Customer Surveys Regarding Quality: feedback on past USPTO surveys of the patent community and proposed modifications for future surveys.
Category 6—Tools for Achieving Objectives: requesting identification of existing tools which are, or can be made, available to users and the USPTO to enhance the quality of the USPTO’s processes. This would include, for example, software tools that will provide meaningful monitoring, search tools, claim analysis tools, and case law identification tools.
Category 7—Incentives: requesting comments on means to incentivize applicants and USPTO personnel to adopt procedures and practices that support the achievement of patent quality. Notes the PTO: "It is recognized that any additional effort to increase the quality of the product has an associated cost."
Written comments must be received on or before February 8, 2010. No public hearing will be held. Written comments should be sent by email addressed to patent_quality_comments@uspto.gov.
WASHINGTON - The U.S. Commerce Department’s Patent and Trademark Office (USPTO) will pilot a program to accelerate the examination of certain “green” technology patent applications, Secretary Gary Locke announced today. The new initiative, coming days before the United Nations Climate Change Conference in Copenhagen, Denmark, will accelerate the development and deployment of green technology, create green jobs, and promote U.S. competitiveness in this vital sector.
[P]ending patent applications in green technologies will be eligible to be accorded special status and given expedited examination, which will have the effect of reducing the time it takes to patent these technologies by an average of one year. Earlier patenting of these technologies enables inventors to secure funding, create businesses, and bring vital green technologies into use much sooner.
To be eligible for the expedited review, the patents must "materially contribute" to environmental quality, discovering or developing renewable energy resources, improving energy efficiency or reducing greenhouse gas emissions. While it is alwys good to see the USPTO make steps to reduce pendency, one has to question why the USPTO is choosing to engage more in technologically-specific pilot programs that appear more as political patronage than sound patent policy (timing the announcement just prior to the Climate Change Conference in Copenhagen doesn't help either).
Clearly, "green" technologies are important (depending how you define it), but should the PTO be in the business of pitting technologies against one another as part of its examination policy? The examination process at the USPTO is, more or less, a zero sum game right now - if you reduce the pendency for certain applications, you will likely increase the pendency for others (the PTO will not hire additional employees for the pilot program). And, unlike business-method and software patent applications, green technology was never identified as experiencing any unusual pendency problems. Why the sudden urgency?
Director Kappos states: "“Every day an important green tech innovation is hindered from coming to market is another day we harm our planet and another day lost in creating green businesses and green jobs . . . Applications in this pilot program will see a significant savings in pendency, which will help bring green innovations to market more quickly.” Aside from being cliché, this statement is somewhat insulting: what technological sector doesn't view their patents as "important" and vital to job creation?
It's hard to believe, but it has been almost 5 years since the NTP v. RIM case dominated the headlines and became a rallying point for much of the patent reform efforts we have seen to date. In that case, NTP successfully asserted 5 patents against RIM, receiving judgment in the amount of $53.7M, as well as a permanent injunction.
The district court stayed the injunction, pending appeal to the Federal Circuit. On appeal, the court upheld most of the lower court's findings, and remanded the case on claim construction issues (read the December 14, 2004 opinion here). Just prior to the remanded proceedings, RIM settled the case and paid NTP $612.5 million "in full and final settlement of all claims against RIM, as well as for a perpetual, fully-paid up license going forward."
While the court proceedings raged on, a similarly heated battle took place at the USPTO, where NTP's patents were subjected to multiple reexaminations; one of the requests were ordered by the USPTO Commissioner himself. The PTO's unusual interest in the reexamination, along with alleged improper contact between RIM and the PTO, sparked controversy in the patent community, where some argued that the PTO's actions gave the appearance that the proceedings were "fixed" against NTP (for more info, see here). Even congressman Howard Berman, chairman of the House subcommittee on courts, the Internet and intellectual property, was concerned enough about an alleged meeting between the CEO of RIM and high level PTO officials that he formally questioned then-PTO Director Dudas in a list of oversight inquiries.
While this controversy continues to linger, the BPAI has released opinions on 3 of the 5 NTP patents that were rejected during reexamination. In the opinions, some of the rejections were reversed, but most of the rejections, particularly the obviousness rejections (now subject to KSR), were upheld. It appears that all of NTP's claims are rejected. The opinions are an interesting read, but long - in total, the 3 opinions are almost 800 pages in length and address hundreds of different claims.
It is worthwhile to note that NTP is also in litigation with Sprint, T-Mobile, AT&T and Palm on these and related patents. The BPAI has issued opinions on these patents as well - just as in the RIM case, the BPAI reversed some of the rejections, but upheld rejections based on obviousness.
Presidio argues persuasively that “the grant by the examiner of a request for reexamination is not probative of unpatentability.” . . . “The grant of a request for reexamination, although surely evidence that the criterion for reexamination has been met (i.e., that a ‘substantial new question of patentability’ has been raised, 35 U.S.C. § 303), does not establish a likelihood of patent invalidity.” . . . On the contrary, although it appears that the USPTO grants about 92% of the requests for reexamination, in only 12% of cases does that reexamination result in all claims being cancelled. . . . There is thus a “substantial likelihood” that, despite the grant of reexamination, the USPTO will uphold the patentability of some or all of Presidio’s claims.
Moreover, even if the reexamination proceedings are somehow relevant on the issues of obviousness or willfulness, they are nevertheless unfairly prejudicial. See FED. R. EVID. 403. As noted above, because the reexamination proceedings before the USPTO are still incomplete and based solely on the evidence provided by ATC in its replacement request for reexamination, there is very little probative value to the grant of reexamination. On the other hand, the prejudicial effect as well as potential for jury confusion is great. Thus, because the prejudicial potential of the evidence “substantially outweigh[s]” any probative value, it should be excluded.
Interestingly, the court granted ATC’s earlier motion to exclude from trial any reference to the “presumption of validity” based on the reexamination. The court remarked that "[w]ith any reference of the 'presumption of validity' excluded, allowing the jury to hear about incomplete USPTO proceedings will be unfairly prejudicial to Presidio, and could potentially confuse the jury as to who has what burden throughout the trial."
F. Scott Kieff and Henry E. Smith authored a chapter in the book "Reacting to the Spending Spree: Policy Changes We Can Afford" which examines challenges the Obama administration faces today, and in the foreseeable future, and the administration’s planned responses.
Kieff and Smith's contributions deal with the topic of patent reform and the authors' view that in light of the rapid (and arguably excessive) changes that have already occurred in the courts, patent law needs "a tweaking of existing safety valves and processes" and not an "opening [of] the floodgates to more discretion and uncertainty." Essentially the authors argue that ever-increasing discretionary power in the courts and the PTO will eventually gum up the innovative process.
The proposed statutory changes would implement the same flexible approach urged by one side of the KSR debate. We think that flexibility can be carried too far and that the flexibility approach on offer relies on two false premises about how the system actually works.
The first false premise is that beefing up the patent examiner’s resources would help her find the key prior art. Of course, our examining corps should have good access to Internet databases and ample time and training to peruse them. But no realistically available amount of time and training will help an examiner at his desk obtain the laboratory notebook of an individual researcher at some company or university or an obscure student thesis on the bookshelf of a foreign library, which is where the key prior art is often found.
The second false premise is that discretionary decision making, whether in court or the Patent Office, can be immune from political and other pressure. Asking a decision maker to use her legal or technical expertise as the primary basis for deciding what she thinks the state of the art was at a particular time in history gives her greater discretion than asking an ordinary jury whether a particular document or sample product existed at a particular time and what that document actually contains. By increasing the discretion of government bureaucrats, flexibility increases uncertainty and gives a built-in advantage to large companies with hefty lobbying and litigation budgets.
Remove the presumption of patent validity. [D]ialing down the present presumption of validity to something like the ordinary standard for civil cases would decrease the bad, in terrorem, effect [of aggressive patent litigation]. When litigation is needed, the carefully crafted Federal Rules of Civil Procedure govern the procedures for joinder, compulsory counterclaims, and against relitigating issues and claims decided in previous litigation, which are collectively designed to avoid abusive and repetitive process. The Federal Rules also provide streamlined procedures such as summary judgment, which avoids long trials where there is no genuine issue of material fact.
Equity in remedies. We think that the best way to implement eBay is to take this equitable approach seriously and apply it in the traditional (and sensible) fashion. Crucially, the equitable approach is a safety valve for those situations in which someone who is otherwise a good candidate for getting an injunction—such as a patentee whose patent has been infringed—should not get one because of some glaring injustice. The equitable approach is flexible but not boundlessly so, in contrast to currently proposed reforms that elevate discretion to new heights. Moreover this safety valve is probably all we would need.
The approach we propose will decrease slightly the average value of all patents because patentees will now have to fight harder on the issue of validity when they assert their patents in court. But this is not necessarily bad. The costs of arguing to the Patent Office to get patent rights in the first instance will be less than in a system under which the examiners have largely unfettered discretion to reject applications.
Most important, the approach we propose directly addresses the fears of those held hostage under the current system by the threat of litigation costs surrounding patents that are merely presumed to be valid. Under a decreased presumption of validity, such a terrorizing effect largely evaporates. With fee shifting, meritless suits against infringers will be discouraged, and the full traditional but limited use of equitable discretion will provide all the safety valves we need for good-faith infringers and those facing true patent trolls.
These approaches should be given time to work. The prudent course for the country is to embrace a strong patent system based on predictability and facts, which will benefit all players, large and small, in their contributions to American innovation and economic growth.
An excellent, concise paper (24 pages), worthy of a read for anyone interesting in reforming our patent system.
Unlike Bilski, H&R argued that the business method was tied to a machine (i.e., computer) and pointed to specific claims directed to "a computerized system for distributing spending vehicles."
Since the court did not issue a claim construction opinion, Magistrate Judge Love accepted plaintiff’s contentions that the patents claim “computerized systems” that are capable of performing certain functions as defined by the claims allegedly functional language.
A financial relationship is simply an abstract intellectual concept. Absent the recitation of a computer, the ‘862 patent would certainly claim unpatentable subject matter. See Benson, 409 U.S. at 67 (reiterating “the long standing rule that ‘(a)n idea of itself is not patentable’”). Plaintiff argues the present recitation of a computer imposes meaningful limits on the scope of the claim such that a fundamental principle is not fully preempted. The Court disagrees. The computer component is not a particular, special purpose machine; it is capable of no more than storing and retrieving data memorializing associations. The computer is an insignificant, extra-solution component of the claimed system. Cf. Bilski, 545 F.3d at 961-963 (concluding that data gathering steps are insignificant extra-solution activity). If an extra-solution step is insufficient to render an otherwise unpatentable process claim valid, then by analogy an extra-solution component is insufficient to render an otherwise unpatentable “system” claim valid. Thus, the addition of a generic computer, capable only of storing and retrieving data associating payments with spending vehicles, to the claimed system fails to impose meaningful limits on these claims. Therefore, the Court finds the claims of the ‘862 patent invalid for claiming unpatentable subject matter.
[T]he Court finds that none of the remaining claims at issue pass the transformation prong of the test. Plaintiff argues that the ‘829 claims transform “tax return data into an anticipated tax refund amount which is transformed into a spending vehicle issued by a third party provider” and that the ‘425 method claims transform “an individual’s income and expense data into an estimated income tax return amount which is transformed into a loan distributed to a tax payer.” PL.’S RESP. at 24. Plaintiff argues the data “represent real world items (e.g., money).” Id. at 25. It argues that income and expense data do not represent hypothetical income and expenses but rather “actual money which has been earned and spent.” Id. The final transformation, it urges, is from data to a loan for a specific amount of money. Id. At all steps in the claimed processes, the manipulated data represent legal obligations and relationships. See Bilski, 545 F.3d at 963. However described, the data and resulting loan represent money. Although tangible in some forms, money is simply a representation of a legal obligation or abstract concept. Therefore, the Court finds that the claims of the ‘829 patent and the method claims of the ‘425 patent fail the transformation prong of the machine-or-transformation test.
For whatever reason, numerous spoofs have been made using the "Hitler rant" scene from Der Untergang ("Downfall"), ranging from US elections, the real estate market, ACORN, etc.
Well, a spoof relating to patent law (and more specifically Bilski) has now been made, and it's quite funny, although at times you can't tell if the character playing Hitler is pro-patent or anti-patent . . .
Also, the blog has been bookmarked on the 271 Blogroll, and may be conveniently accessed there too.
Finally, the PTO appears to be warming up more to RSS feeds (or maybe I'm just getting around to noticing it) - the blog has a variety of RSS feeds that the public may use to follow the blog, as well as other news from the PTO site.
Well, the analysis has started to roll in, and one thing is certain about the Bilski case: almost no one believes that the claims on appeal will be held patentable. Not one Justice defended Bilski's method claim directed to hedging risks in commodities trading. What appeared to bother the court the most was the concept of business methods based entirely on human activity, or, as Bilski's attorney Michael Jakes put it, "methods of organizing human behavior."
JUSTICE BREYER: [I]n the nineteenth century, they made it one way with respect to machines. Now you're telling us: Make it today in respect to information. And if you ask me as a person how to make that balance in respect to information, if I am honest, I have to tell you: I don't know. And I don't know whether across the board or in this area or that area patent protection will do no harm or more harm than good.
So that's the true situation in which I find myself in respect to your argument. And it's in respect to that, I would say: All right, so what do I do?
JUSTICE SOTOMAYOR: And so it begs the question, because we go around in a circle: What does "process" mean in a patent law that was passed in 1952 that had one set of manufacturing and other items that are technologically tied and this is not? So how do we discern Congress's intent, other than by the use of the word "process" in context?
JUSTICE BREYER: Now, [the Federal Circuit has] left much unresolved. One, transformation; how broad or narrow is that? We don't know. Many people's problems will be solved if it's broad on the one hand or narrow in the other.
Two, are you automatically patented -- in the patent statute, if you just sort of reduce this to a machine by adding a computer on at the end? They've flagged that as a problem. They haven't answered it. Could there ever be a situation where it doesn't meet this test but still is patentable? We are not sure.
At this point, the Justices appeared to tacitly accept the Federal Circuit's "machine-or-transformation" (MOT) test by default - i.e., unless they hear of something better, the MOT test will have to do for now.
JUSTICE SOTOMAYOR: Well, isn't the manipulation of electronic signals a substance that is different in kind from just a method of how to go about doing business or a method of how to approach a particular problem?
Isn't there -- isn't that what the Federal Circuit was trying to explain, which is that there has to be something more substantive than the mere exchange of information; that it has to involve -- it used the word "transformation." It hasn't defined the outer limits of what it means by that.
MR. STEWART (USPTO): Well, first of all the only ruling that we're -- backtrack a bit, to say, we oppose,sir, in this case because we recognize that there are difficult problems out there in terms of patentability of software innovations and medical diagnostics.
JUSTICE KENNEDY: You thought we -- you thought we would mess it up.
MR. STEWART: We didn't think the Court would mess it up. We thought that this case would provide an unsuitable vehicle for resolving the hard questions because the case doesn't involve computer software or medical diagnostic techniques, and therefore, we thought the Court would arrive at the position that I think, at least some members are feeling that you have arrived at, that you will decide this case, and most of the hard questions remain unresolved. And, frankly, we think that's true.
JUSTICE GINSBURG: But this case could be decided without making any bold steps.
JUSTICE GINSBURG: But even the Federal circuit didn't say it was a retest. It said it is for now. We know that things that we haven't yet contemplated may be around the corner, and when they happen, we will deal with them.
For people that still cling to the fantasy that software patents will be banned, you will have to wait for another day. The court appeared to recognize that this case was not about computers and computer software (in the words of Justice Sotomayor: "no ruling in this case is going to change State Street"), and the majority of the discussion was directed to human-activity business methods. As such, it is highly unlikely that the Court will rule in any meaningful way against software patents.
MR. JAKES: It can be, but when it's transmitted over a wire, it's not. It's something else. It's an electrical current then.
Justice Ginsberg seemed to me to be the most openly hostile toward business methods, as well as the US patent system in general. She mentioned with a certain incredulous attitude the thought of patenting tax avoidance methods, estate planning, how to resist a corporate takeover and how to select a jury. Ginsberg then several times later kept asking about how other countries handle this type of invention, noting that other systems work with a technology requirement and do not accept these types of processes as patentable. Jakes correctly pointed out that other systems follow that approach, but there is no support in US law for that approach to be followed here.
Justice Breyer also seemed unfavorable toward business methods being patentable, but seemed to genuinely be trying to figure out where to draw the line, even one time admitting that if he is honest with himself he does not know what the answer is at this point. Breyer did have difficulty with the thought that “anything that helps a businessman succeed would be patentable” if the Supreme Court were to adopt the Bilski proffered approach.
The largest question left unanswered when the one-hour argument was over was whether the Court would go forward and issue a major new ruling interpreting patent law, when the practical result here seemed so evident. Lawyers and judges have invested heavy resources in the Bilski case, and it does raise a fundamental question that may well need answering. But, when there may well be no formulation of patent law that would salvage the Bilski-Warsaw creation, why bother?
The long-awaited Supreme Court patent law showdown in Bilski v. Kappos is over, and it not looking good for business method patents -- or at least the one at issue in the case. Justices overall seemed hostile to a broad view of patent eligibility that would include intangible business processes.
Justice Stephen Breyer said that if everything that "helps a businessman succeed" is patent-eligible, it would "stop the wheels of progress" by granting exclusive rights to innovations that should be available to all. When J. Michael Jakes of Finnegan, Henderson, Farrabow, Garrett & Dunner, arguing in favor of the patent at issue, said one benefit of patenting innovations is public disclosure, Justice Sonia Sotomayor countered that patents in fact "limit the free flow of information." Sotomayor, a onetime intellectual property lawyer in New York, was viewed as a potential pro-patent vote, but her comments suggested skepticism.
But it's not certain that a defeat for Bilski and Warsaw will mean the Court is embracing U.S. Court of Appeals for the Federal Circuit's narrow view that to be eligible for a patent, an invention must be tied to a machine or a physical transformation. Justice Ruth Bader Ginsburg and others voiced some concern about adopting a rigid rule that would fail to anticipate unknown kinds of innovations in the future.
Which Patent Office Does It Best? Survey Says: "The EPO"
Joff Wild at the IAM Blog reported on an on-going benchmarking survey being conducted by IAM magazine and Thomson Reuters on various patent-related topics. Recently they asked questions to various professionals regarding patent quality at the larger patent offices.
Examination Quality is "Excellent" or Very Good"
Clearly, the EPO is regarded as the pace-setter among the world's leading patent offices; both the Koreans and the Chinese have improved significantly, but still have work to do. What our respondents are telling us about the USPTO, meanwhile, only goes to emphasise the job that David Kappos has in front of him. That said, it seems to me that there are still far too many people who believe that none of the offices we asked about offer high enough standards. There is room for all of them to up their game, at least as far their users are concerned.
a simulation verification environment configured to verify said structurally variable and complex system in response to said system level netlist, wherein said simulation verification environment is configured to provide automatic random verification of said structurally variable and complex system in response to said random system configuration file.
purpose digital computer" and the specification did not provide any examples of how algorithms were constructed. Instead, the specification stated that "appropriate software coding can readily be prepared by skilled programmers based on the teachings of the present disclosure, as will also be apparent to those skilled in the relevant art(s)."
The BPAI reviewed the claims and found them to be indefinite under 35 U.S.C. 112.
Starting with the means-plus-function (MPF) claims, the BPAI relied on Aristocrat Techs. Austl. Pty Ltd. v. Inter. Game Tech., 521 F.3d 1328 (Fed.Cir. 2008) for the proposition that MPF claims in which the disclosed structure is a computer, or microprocessor, programmed to carry out an algorithm, the disclosed structure is not the general purpose computer, but rather "the special purpose computer programmed to perform the disclosed algorithm." As such, the corresponding structure for a 112 ¶ 6 claim for a computer-implemented function is the algorithm disclosed in the specification.
The cited portion of the Appellants' Specification describes generally that the system 100 may provide automated random verification of complex and structurally variable systems. However, the cited portion of the Specification does not provide an algorithm by which the system is able to perform the functions recited in claim 10 to provide automated random verification of complex and structurally variable systems.
We have looked to both general and subject matter specific dictionaries and we find no evidence that any of these terms have achieved recognition as a noun denoting structure. Therefore, based upon our consultation of dictionaries, a review of the record before us, and a search of the prior art patents in this field, we conclude that none of these three terms is an art-recognized structure to perform the claimed function, and claim 1 does not recite any other structure that would perform these claimed functions . . . we conclude there is no structural context for determining the characteristics of these claim elements other than to describe the function of each element. We further conclude that these claim elements are verbal constructs that are not recognized as the name of a structure and are simply a substitute for the term "means for."
Again, the BPAI found the lack of algorithmic disclosure in the specification rendered the claim indefinite.
Alternately, the BPAI rejected the claims under section 112, first paragraph, ruling that the claim elements are purely functional (i.e., there is no particular structure to support the function being performed) and thus were not enabled without undue experimentation.
We recognize that functional language does not, in and of itself, render a claim improper . . . [however] the scope of the functional claim language here in claim 1 is not enabled to its entire scope . . . Appellants' claim recites no meaningful structure. Instead, the scope of the functional claim language of claim 1 is so broad and sweeping that it includes all structures or means that can perform the function. It is not limited to any corresponding structure, material, or act disclosed in the specification and equivalents thereof.
[W]ith this opinion we do not mean to imply that all functional language will violate the Halliburton rule as it does here. We note that functional claim language tied to a definite structure in the claim . . . is unlikely to give rise to an enablement rejection where a person of ordinary skill in the art would likely know how to make and use the embodiments that give rise to the structure. However, in this case and those like it, the purported "structures" in the claims are essentially black boxes not connoting any structure to the skilled artisan, and are merely circularly defined by their desired functions. For the reasons expressed above, these "structures" are not enabled and are properly rejected under 5 112, first paragraph.
Patent Officials: "Worst Is Yet To Come"
Gerard Torres of the United States Patent and Trademark Office (USPTO) said an analysis of patent filings at his organisation suggests there is usually a lag of about one year between a recession and its effect on patent filings.
"The current recession is typical in this manner, as monthly patent filings did not begin to display weakness until late 2008, early 2009. This may mean the worst is yet to come in terms of the decline in patent filings. Total patent filings are expected to be down by about 1% to 2%," he said.
The EPO acknowledged that a similar picture is evident in Europe where the full impact of the recession on patent filings will not be clear for some time. A spokesperson said companies follow a range of patterns when filing patents in several countries, with timescales ranging from 12 to 32 months.
"We may get the full picture of how the patenting activity was influenced by the crisis later this year, or perhaps only next year," a spokesperson said.
Currently, the USPTO is looking to unload about 2 petabytes (i.e., 2000 terabytes) of patent-related data sets to an outside vendor in an effort to segregate public data from the examiner systems, and to make "virtually all public information from the USPTO accessible on the Internet. " Importantly, the PTO wants to make this information free of charge to the public, including current pay-for-service data products (e.g., XML Grants). Also, this change appears to be part of a longer-term "data dissemination solution" for allowing high-volume dissemination.
Notably, the USPTO has no current plans to scan or convert paper files into electronic form.
One of the agency’s potential solutions is to enter into one or more no cost contract(s) where the vendor(s) will fund the development of a secure infrastructure at the USPTO that will permit unrestricted delivery (exceptions to this may be treaties with foreign countries or data considered to be sensitive if shared with certain other specific countries/entities) of the data in bulk or a common machine readable format to the vendor. The vendor will be responsible for funding the ongoing operation of the infrastructure, including the maintenance of the historical data and the periodic updates to the data. The vendor will also be required to make the data that is provided by the USPTO available to the public on a no charge basis. As part of any resulting agreement, the vendor will be allowed to maintain, repackage (add value), distribute, and sell any resulting enhanced data sets and retain any fees collected.
• On the opposition outcomes, between 22.6 and 24.4% of litigated patents are revoked at the EPO. This is lower compared to the 27.6-39.5% of non-litigated patents. Surprisingly, approximately 14% of oppositions are abandoned by the owner.
[O]ur analysis and welfare calculations suggest that the benefit from PGR review in terms of social welfare per year—when put in dollar terms—could be nearly $25 billion. The main parameter affecting this estimate is not savings on the cost of litigation, but the social costs of currently unlitigated patents that bestow excessive market power on some applicants. This market power either allows the patentee to extort licensing fees, or force competitors to invent around the respective patent. But even when we draw a conservative scenario, and assume a very low social cost figure of $1 million on average for these patents, our benefit-cost ratios still indicate that the benefits of such an institution compares very favorably to its costs.
While it has not yet been announced officially, Arti Rai appears to be on her way to becoming the USPTO's next Administrator for External Affairs. In this position Rai will oversee the Office of International Relations , the Office of Congressional Relations and Office of Enforcement. According to at least one report, Rai is expected to arrive "any day now" to take the position.
In related news, Peter Pappas, who previously served in several capacities in the Clinton administration, has been brought on to head up the USPO's communications and public outreach operation.
Senate Judiciary Chairman Patrick Leahy said Thursday he wants to work with Majority Leader Harry Reid to schedule debate before the end of the year. Leahy made his comments the same day that PTO Director David Kappos told the American Intellectual Property Law Association's annual meeting that a legislative fix is needed immediately. "Not everyone is getting everything they want" in the bill, Kappos said, but it is a "major positive step" for the stakeholders involved.
These so-called post-grant review provisions, as currently crafted, are quite problematic. This language, which would permit serial challenges to patents at the U.S. Patent and Trademark Office and in the courts, threatens to diminish the value and enforceability of U.S. patent rights at a time when America's economic recovery is dependent on the strength of U.S. innovation. Ideally, we hope these issues can be fully resolved before the bill comes to the floor.
The Association of Corporate Counsel (ACC) announced this week that it will feature USPTO Director David Kappos at its 2009 Annual Meeting in Boston next week. Kappos will appear on an interactive panel discussion, “Meet the USPTO Brass”, on Tuesday, October 20 at 9 am Eastern at the Hynes Convention Center. The event is presented as part of the ACC Annual Meeting in conjunction with the ACC Intellectual Property Committee.
According to the ACCA website, high-level USPTO personnel will be on hand to "discuss current patent and trademark issues, and more importantly, listen to you — the customer." In addition to Kappos, Commissioner for Trademarks Lynne G. Beresford and POPA President Robert Budens will be on hand to participate and take questions.
SMEs, 95 percent of which are privately-owned, have played an increasingly important role in China's economy over the last several years. SMEs contribute to 60 percent of China's GDP, 50 percent of tax revenues, 68 percent of exports and 75 percent of new jobs every year, according to official statistics.
SMEs accounted for 66 percent of patent applications in China in 2008, but overseas is a different story.
Ma Hongya, an official from the Beijing Intellectual Property Bureau, told the Global Times that the Chinese firms applying for patents abroad are mainly large companies, and SMEs cannot afford to carry out the procedures and research an application requires.
[F]oreign patent application projects must either help exert China's industrial advantage and be internationally competitive; be expected to explore the international market or expand its international market share; or have patented products with an expected large capacity in the international market and good market prospects.
Under the proposed policy, the government will provide SMEs as much as 500,000 yuan ($73,238) for each patent application abroad.
Government Agencies do not patent heavily, as they account for approximately 1% of all utility patenting per year. Many government agency patenting efforts are more for defensive purposes. However, governments contribute significantly to patenting innovations through funding and grants to both private and public sectors.
• 85% of the PTO's first office actions are non-final rejections; only 13.5% of granted patents issued on the first office action without any argument or negotiation.
• Despite the fact that Examiner amendments are allowed as of right only after a non-final rejection, 77.2% of interviews come after the final rejection. While 50.91% of applications with a final rejection but no interview are eventually patented, 62.6% of those with an interview after final are patented.
• 14.4% of all applications have children (continuations, CIPs, divisionals); 15.9% of all applications have RCEs. Of the continuation types, 30.16% are continuations, 20.96% are CIPs and 38.19% are divisionals.
Under Secretary of Commerce for Intellectual Property and Director of the USPTO David Kappos has signed a new Final Rule rescinding highly controversial regulations, proposed by the previous administration, that patent applicants felt unduly restricted their capacity to protect intellectual property. The regulations, which addressed the number of continuation applications as well as the number of claims that could be included within each application, were published in the Federal Register in August 2007, but were enjoined and never came into effect.
The USPTO also announced that it will file a motion to dismiss and vacate the federal district-court decision in a lawsuit filed against the USPTO that sought to prevent the rules from taking effect. GlaxoSmithKline - one of two plaintiffs in the Tafas v. Kappos lawsuit - will join the USPTO’s motion for dismissal and vacatur.
Interestingly, plaintiff Tafas has not agreed to drop the action and maintains that the district court decision should be upheld to limit the USPTO’s substantive rulemaking power.
Lat week the USPTO announced that it is expanding its First Action Interview Pilot Program, where an applicant is entitled to an interview with the patent examiner prior to the first office action on the merits in a new utility application.
[T]he patent process benefits when interaction between the applicant and the examiner are enhanced at the beginning of examination because patentability issues can be resolved early when the applicant and the examiner discuss them one-on-one. For the applications involved in the initial pilot, the First-Action Allowance rate increased six-fold when compared to applications from the same technology area not involved in the pilot.
Currently, an applicant may request an interview prior to a first action. However, granting of an interview is within the discretion of the examiner who has not yet reviewed the case, and the applicant may be required to identify relevant documents and explain how the invention is patentable over these documents.
Under the expanded pilot program, the examiner will conduct a prior art search and provide the applicant a pre-interview communication, which is a condensed preview of objections or rejections proposed against the claims. Within 30 days from the issue date of the pre-interview communication, the applicant must either choose not to have a first action interview with the examiner, or schedule the interview and file a proposed amendment or remarks (arguments).
Should the applicant choose not to have a first action interview, a First Action Interview office action will be promptly issued and the applicant will have one month or 30 days, whichever is longer, to reply. If an interview is scheduled, the applicant must be prepared to discuss issues related to the patentability of the claims. In this interview, if the applicant and the examiner reach agreement on all claims in regards to patentability, a notice of allowance and fees due will be issued. If agreement is not reached on all claims in regards to patentability, the applicant will be given a First Action Interview office action setting forth any requirements, objections and rejections to which the applicant will be given one month or 30 days, whichever is longer, to reply, with limited extensions of time. It is this First Action Interview office action that is considered the first action on the merits in the application.
There have been several improvements made to the program since the initial pilot. For example, the response period to reply to the pre-interview communication can now be extended by 30 days. Also, the applicant can now waive receipt of the First Action Interview office action during the interview with the examiner, convert the previously-submitted draft amendment to a formal amendment and proceed directly to the second substantive examination. This may be preferable to those who would prefer not to wait for the First Action Interview office action and refile the proposed amendment formally.
- Generally, an applicant's request to participate in the program must be filed during the six month life of the program and at least one day before a first Office action on the merits of the application appears in the Patent Application Information Retrieval (PAIR) system.
The USPTO is in the process of correcting an error in the computer program that it uses to calculate the patent term adjustment that affects patents issuing from international applications entering the national stage as to the United States pursuant to 35 U.S.C. § 371. The USPTO's computer program incorrectly calculates the three-year pendency provision of 35 U.S.C. 5 154(b)(l)(B) in international applications as being measured from the date that the requirements of 35 U.S.C. 9 371 were fulfilled rather than the date the national stage commenced under 35 U.S.C.4 371(b) or (f) in the international application.
"The judges of the Northern District of Illinois have enacted the Court’s Local Patent Rules to guide the pretrial procedures in patent cases. The Local Patent Rules are effective as of October 1, 2009, and are available on the court’s web site, www.ilnd.uscourts.gov, under Local Rules."
Click here to view the local rules from the court's website.
I think the selection of David Kappos as the director of the USPTO is the clearest indication of the new administration's appreciation of IP issues . . . This appointment is salutary - Kappos is a highly experienced lawyer with a worldwide perspective and strong management, as well as legal and technical, skills.
The US Congress decided some years ago that the USPTO must be self-supporting. However, this works only if the fees are adequate to generate the revenue needed for a high-quality, speedy process for both trademarks and patents. I think the reality is that the fees, although they have been raised over the years, are still woefully inadequate to support the examination and IT resources required on the patent side and they barely cover the internal costs incurred on the trademark side. In my opinion, Congress has relied excessively on fee revenue to support the office. During the current economic crisis it would make sense to alter the financing arrangements in place for the USPTO so that it can draw on both taxpayer and fee-generated funds. I am not suggesting that this dual-funding option should be ongoing, but I do think it would be justified as an emergency stop-gap measure. A transfusion of public money to the USPTO would help rescue it from its current mission impossible. It simply cannot do the job needed by industry, the corporate world and ultimately the national economy with the totally inadequate resources it currently commands.
Michel's remarks can be viewed in full at World Trademark Review (registration required). You can also read comments from Joff Wild at the IAM Blog here (link).
Patent legislation is an opportunity for things to get much better, but it's also a risk for things to get much worse, and it's not entirely clear which direction it's going to head in . . . It will depend a lot on what people in the profession do. If we each do our part, then I think the odds go up greatly that the outcome will be favorable to the broad mass of companies.
Michel estimates that 14 Silicon Valley companies, which mainly produce computer and telecommunications equipment, are influencing the debate the most. The interests of many other industries and geographic regions and the bulk of some 30,000 U.S. companies with more than 100 employees, he suggested, are not being heard.
In reviewing most of the congressional testimony from the past five years, Michel said he found it lacking. Specifically, he said statements that the patent system has been ruined by an explosion of litigation and that there have been rampant and excessive damage awards are wrong. Both the number of patent infringement cases filed and the median award in those cases have been stable for the past 15 years, he said.
Yesterday, the PTO published a briefing paper that was provided to the USPTO examining corps (via POPA) on a proposal that would change the "count system" in the USPTO, which is universally blamed as being a large contributor to the current backlog. Under the current count system, examiners are paid using a modified GS schedule and earn more money through productivity "count" incentives. As examination progresses, examiners get counts to earn incentive credits at various stages. The more "counts" an examiner gets, the more money he/she typically earns.
Of course, this has led to accusation of examiners (as well as applicants) "gaming" the system to gain an advantage (e.g., "RCE churning"). The current proposals are aimed at curbing these practices.
• Provide consistent credit for transferred or “inherited” amendments - initial or first Office Action done by the new examiner on the transferred or “inherited” amendment will get a set amount of counts (non-RCE transfers = 1.5 additional counts total; RCE transfers = 1.75 counts).
- No examiner shall receive an oral warning based upon a single clear error in Patentability Determination.
- No examiner shall be deemed to have failed an oral warning improvement period on the basis of a single clear error in Patentability Determination.
- However, an examiner may receive an oral warning for multiple clear errors in Patentability Determination over a period of two or more consecutive quarters during a fiscal year.
As a side note, the Kappos proposal is not final - the modifications must still be approved by agency employees in the coming weeks. If enacted, the modifications to the count system would be the first major change since 1976.
Applicants should be encouraged that this proposal came so quickly after Kappos took over in the USPTO. Additionally, the USPTO has traditionally been less-than-eager to post or otherwise publish these types of internal documents - the openness of the current regime is certainly refreshing.

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