Unhappy with the Ex parte Appeal Rule? Read This Now -- Updated

    By Richard Belzer --

The U.S. Patent and Trademark Office (PTO) today published a notice in the Federal Register inviting public comments on paperwork burdens associated with the changes in the procedural requirements for ex parte appeals (73 Fed. Reg. 32937-32977, June 10, 2008).  This notice arises under the Paperwork Reduction Act (44 U.S.C. § 3501 et seq., and implementing regulations at 5 C.F.R. Part 1320).  The Paperwork Reduction Act (PRA) is a very important law that is almost completely unfamiliar to most patent practitioners.  Its purpose is to protect the public from abusive governmental demands for information.  Compliance with the requirements of the PRA is determined by the Office of Management and Budget (OMB), a neutral arbiter outside the PTO whose statutory responsibility is to ensure that federal agencies treat the public fairly.  It is OMB, not the PTO, that will be reviewing comments submitted during this notice-and-comment period.  Without OMB's approval, the Patent Office will have no legal authority to compel patent applicants to comply with the Ex Parte Appeal Rule (or, for that matter, the formatting requirements of the current 2004 appeal rules, for which the PTO never sought OMB approval).

In view of the patent community's recent experiences with proposed rules promulgated by the PTO, and the suspicion that the Office has not always made a good faith effort to comply with rulemaking procedures, it is important for the portion of the public most informed about patent matters -- patent practitioners and their clients -- to avail themselves of this opportunity to let OMB know your views on the impact the Ex Parte Appeal Rule can be expected to have.

(We note that the PTO published this notice on Wednesday, October 8, 2008.  This is the last day on which the Notice could have been published to still allow OMB 60 days to review the rule before the effective date of December 10, 2008.  However, by email today, the PTO conceded that its submission to OMB is not yet ready to be distributed for comment.  Because the PTO cannot give the public a full 30-day comment period, the PTO would appear to be in default of its obligations under the law.  This late notice, and lack of preparation, is consistent with earlier PTO actions with regard to their obligations under the PRA.  For example, the initial Paperwork Notice was published on June 9, 2008, a year later than required, and today's Notice does not fit within any available rule.)

WHAT YOU NEED TO DO

1.  Obtain the documentation from the PTO.

The first thing to do is send an email request to the PTO asking for a copy of the relevant documents:

To:  Susan.Fawcett@uspto.gov
Subject Line:  0651–00xx Board of Patent Appeals and Interferences (BPAI) Actions copy request
Message Body:  Please send by reply email a copy of this ICR and the Supporting Statement.

It would be useful if you include a bcc to me (rbbelzer at post.harvard.edu) so that I can count how many requests are sent to the PTO as a result of this alert.

You should receive at least two documents.  The first document is the "ICR," or "Information Collection Request."  An ICR is a formal request by an agency to OMB for OMB's approval under the Paperwork Reduction Act, without which the agency has no authority to compel the public to supply any more information than is required by the bare text of the statute.  The text of the ICR will contain summary information.

The second document is the "Supporting Statement."  By law, the Supporting Statement must include objectively supported estimates of burden, and these estimates must be transparent and easy for you to reproduce to see how they were derived.  This document will have the estimates that the PTO provided to OMB, and is where we expect members of the patent community might offer useful comments on any underreporting in the PTO's burden estimates and analytical flaws in developing those estimates.

For reference, the definition of paperwork "burden" is an expansive one, and is defined expressly in the regulations (5 C.F.R. § 1320.3(b)(1); see Appendix below).  Anything and everything covered by this definition should be included.  For example, the final Appeal Rule permits examiners to withhold explanations and some evidence during regular prosecution and inject them for the first time in an Examiner's Answer.  This increases the burdens that arise during ordinary prosecution, raising significant burdens on the public to anticipate what an examiner might do in the future.  This burden is cognizable under the PRA and attributable to the Appeal Rule, even though it temporally occurs during regular prosecution rather than during the appeal process.  The time required to cut a brief to meet the very tight page limit is also cognizable, as is any procedural scuffling required during Rule 116 practice to address any such late-asserted evidence or explanations.

Importantly, estimates based on the "professional judgment," "belief," or "opinion" of Patent Office personnel, or estimates with no disclosed basis, do not qualify as "objectively supported."

2.  Submit a public comment to OMB.

For the next 30 days, OMB will be accepting public comment on the paperwork and recordkeeping burdens associated with the Appeal Rule.  By law, OMB has 60 days to either approve or disapprove the ICR.  Approval of an ICR by OMB gives the agency authority to collect information from the public.  That deadline will run out very close to December 10, 2008, the effective date of the Ex parte Appeal Rule.  For that reason, it is imperative that public comments be submitted as early as possible.  Do not wait until Day 29 to decide to do this.

It is essential that OMB hear from you.  The more thoughtful, reasoned, and documented public comments OMB receives, the better.  Usually, OMB does not receive any public comments at all, and in these cases OMB is compelled by necessity to assume that what the agency provided is valid and reliable.  Your job is to make sure OMB gets higher quality information.

Public comments on the ICR should be sent as soon as possible, and must be sent by November 7, 2008, via email to:

Nicholas A. Fraser
Desk Officer for USPTO
Office of Information and Regulatory Affairs
Office of Management and Budget
Nicholas_A._Fraser@omb.eop.gov

3.  What to include in your public comment.

Public comments to OMB should address the following issues:

1.  Has the PTO provided an objectively-supported estimate of the number of hours it will take to comply with the Appeal Rule?  Historically, the Patent Office has severely underestimated the number of hours, and has failed to provide any analytical transparency into the sources or methods employed.  Often, the PTO's burden estimates consist of mere "judgment" or "belief."  Flawed statistical methods, or "informal surveys" with no disclosure of data or method, are not "objectively supported."  You should not "cut" non-billable overhead hours, or assume any fixed-price cap on hours.  The estimate should be as correct as possible, reflecting all time expended.

2.  Has the PTO provided an objectively-supported estimate of the opportunity cost of each of these hours?  Historically, the Patent Office has significantly understated the hourly cost of attorney time, and assumed that tasks normally performed by attorneys can be performed by lower-cost paralegals and administrative staff instead.

3.  Has the PTO provided an objectively-supported estimate of the number of applications expected to be appealed?  There is considerable controversy about how many appeals should be expected.  For purposes of public comment on this ICR, the Continuations Rule, currently enjoined by the District Court in Tafas v. Dudas but now under appeal, should be assumed to apply.  Do not assume that Tafas will be upheld.  You are entitled to take the PTO at its word, that issues formerly resolved through continuations must now be resolved through appeal, and that every continuation limited by the Continuations rule will mature into an appeal.  Likewise, because the PTO asserted that the non-paperwork regulatory burden (e.g., loss of patent value, scope, or term) is zero, you are to assume that applicants will pursue every available procedural option required to avoid sacrificing any patent value, regardless of cost-effectiveness.  The PTO laid the ground-rule assumptions by asserting that the economic impacts were "not significant" and therefore essentially zero; you are permitted to follow those assumptions wherever they lead and to assume that all available paperwork options will be explored in order to avoid any loss of patent value.

4.  Did PTO contact you for assistance or information to help them estimate the burden associated with the Ex parte Appeal Rule?  By law and regulation, the PTO is required to consult with those who would bear the burden of complying with information collection requirements.  They do not have to consult with all of you, but they do have to consult with some of you.  Statements from the organizations that logically should have been consulted (e.g., AIPLA, ABA-IP, IPO, NAPP) stating that they were not consulted would be especially helpful.

5.  Which elements of the Ex Parte Appeal Rule require you to submit information that the PTO already has in its possession, albeit in another form?  It is against the law for OMB to approve the collection of duplicative information.  Thus, most contents of the appendix required by current and proposed 37 C.F.R. § 41.37(t) are simply illegal.  Are there any other provisions that you believe are duplicative?

6.  Was the PTO's Notice and Comment period conducted fairly?  If you filed a Notice and Comment letter in response to the Notice of Proposed Rulemaking or the June Request for Comment, and the PTO failed to fairly respond to your comment (e.g., by misparaphrasing the comment or omitting a salient issue), the PTO violated Paperwork regulations and Executive Orders also administered by OMB.  OMB's ability to evaluate the PTO's submission will be enhanced if you bring these types of PTO error to OMB's attention.

It is important that OMB receives a rich set of highly informative public comments, preferably from as wide a variety of entities (organizations, firms, large, small, from a variety of technological areas) as possible.  Comments may be more effective to OMB if they are informative without being tendentious.  To this end, I am open to one or a series of conference calls to provide assistance.  To indicate interest in participating, please contact me by email (rbbelzer at post.harvard.edu) or by phone at 703-780-1850.

APPENDIX:  DEFINITION OF "BURDEN"

5 C.F.R. 1320.3(b)(1):

Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency, including:

(i) Reviewing instructions;

(ii) Developing, acquiring, installing, and utilizing technology and systems for the purpose of collecting, validating, and verifying information;

(iii) Developing, acquiring, installing, and utilizing technology and systems for the purpose of processing and maintaining information;

(iv) Developing, acquiring, installing, and utilizing technology and systems for the purpose of disclosing and providing information;

(v) Adjusting the existing ways to comply with any previously applicable instructions and requirements;

(vi) Training personnel to be able to respond to a collection of information;

(vii) Searching data sources;

(viii) Completing and reviewing the collection of information; and

(ix) Transmitting, or otherwise disclosing the information.

_________________________________________________________

For additional information regarding this topic, please see:

• "Patent Office Posts Comments on New Appeals Rules," September 11, 2008
• "More on USPTO Rulemaking Practices,"July 21, 2008
• "USPTO Rulemaking Practices Being Called into Question (Again)," July 20, 2008
• "New Appeals Rules Published," June 10, 2008
• "Patent Office to Publish New Appeals Rules on Tuesday," June 9, 2008

Comments

[EG]

Richard,

I commend your effort to get the word out here. The USPTO hierarchy is so out of control that I look at everything they propose with a jaundiced eye. These Appeal Rules simply exalt form over substance, and do nothing to address the reasons for so many appeals (namely "bad" rejections). What is really annoying is the continuing failure to provide similar requirements for the Examiner's Answer. Good luck to you and your efforts to have decisions on these Rule packages be based on facts, data, and evidence, and not opinion, speculation or politics.

[Lester Rules]

If you email Ms.Fawcett as instructed above, you will receive a reply indicating the following:

The ICR has been submitted to the OMB and is expected to be publicly available within 24 hours on the web at the Federal Information Collection Review page at RegInfo.gov.

Once loaded to the RegInfo.gov site, you may access the full submission. Please go to http://www.reginfo.gov/public/do/PRAMain and search under “currently under review.” You will search the Department of Commerce list for the various “PTO” submissions under review. You can also perform an advanced search for the agency and sub-agency search, and select the status “Received in OIRA”.

If you are interested in obtaining a paper copy of the submission posted to the www.RegInfo.gov site, I can mail you a printed copy. To request a printed copy, please provide me with your physical mailing address.

If you are still interested in an electronic copy through e-mail, let me know. Be advised that it could take 2-3 business days to process your request.

Thank you very much.