IPO Comments on USPTO Three-Track Examination Proposal

By James DeGiulio --

On June 4, in an effort to address the application backlog and its alleged negative impact on innovation, the U.S. Patent and Trademark Office issued a notice concerning an Enhanced Examination Timing Control Initiative (75 Fed. Reg. 31763).  The initiative would, among other provisions, create three examination tracks:  an accelerated examination track, a traditional examination track, and a delayed examination track (see "USPTO Director Announces New Examination Options").  As part of that initiative, the Office called for input from the patent community regarding the proposal.

On August 20, the Intellectual Property Owners Association (IPO) answered the call by submitting its comments in a letter written by Douglas K. Norman, president of the IPO.  Mr. Norman's written comments supplement his presentation at the July 20 public hearing on the initiative.  Mr. Norman first addresses several threshold issues, including practical concerns such as hiring enough examiners to support an expedited examination track, retaining newly generated examination fees within the USPTO, and the compatibility of delaying foreign-based applications with TRIPS and the PCT.

The IPO then addresses the prioritized examination track, which the IPO finds to be generally attractive assuming that the USPTO can ensure that normal examinations are not further delayed by the demands of this new priority track.  In this regard, the IPO prompts the USPTO to provide fee estimates and details on how the Office will safeguard against traditional applications being delayed.  The IPO also draws attention to the effect of the prioritized examination on the Patent Prosecution Highway (PPH) in foreign applications, which may force U.S. applicants to elect the more prioritized route to utilize the PPH.  The IPO warns that this may disadvantage U.S. applicants as compared to foreign applicants, who can obtain prompt examination inexpensively in their home country, and then obtain prioritized examination in the U.S., ahead of other U.S. applicants.

The IPO next turns to the voluntary delayed examination pathway, which the IPO is opposed as contrary to public interest.  The IPO argues that extended time periods for examination leave uncertain the scope of patent protection, which will result in competitor inhibition due to uncertainty of infringement risk, thus negatively affecting competition.  The IPO further argues that mechanisms to delay examination are already in place, such as the 30-month PCT delay or the three-year request for deferral of examination under 37 C.F.R. § 1.103.  The letter suggests that a better alternative would be to issue a refund of the search and examination fees if an application is expressly abandoned prior to examination.

The IPO is most critical of the provision providing for mandatory delay of examination of foreign-based applications.  Initially, Mr. Norman points out that the system is easily gamed, for applicants wanting quick examination would file first in the U.S., while applicants wanting delayed examination would file first in foreign countries which have a long lag to examination.  Moreover, since foreign-based applications would only be removed from the examination queue temporarily, the resulting backlog relief would be only temporary.  This temporary relief is not worth discouraging foreign application filing in the U.S., and could invite retaliatory procedures in foreign patent offices, which would negatively impact U.S. applicants.  Mr. Norman also prompts the USPTO to disclose details on how the fees would be allocated under this track and more details on when and where foreign-based applications would be placed in the examination queue.

The IPO next discusses its opposition to any deduction from Patent Term Adjustment (PTA) due to delays that are beyond the applicant's control.  According to the IPO, the USPTO cannot defer examination of foreign-based applications without awarding PTA.  As an example of the flaws with the initiative's overall approach, Mr. Norman notes that it will be extremely difficult for the USPTO to distinguish between applicant delays and foreign patent office delays in the foreign application.  Exactly how PTA will fit with mandatory delay of foreign-based applications is unclear, according to the IPO's letter.

The IPO questions the proposal to offer a search from an Intellectual Property Granting Organization (IPGO), as the Examiner would still conduct his or her own search.  The IPO predicts that an IPGO search would raise questions about the quality and thoroughness of the USPTO Examiner's own search, which is a fundamental function of the USPTO.

Mr. Norman concludes the letter by reiterating the concerns the IPO has with the proposed three-track system.  While the application backlog at the USPTO is certainly a problem that requires attention and perhaps reform to address, the IPO is wary of the unintended potential consequences of voluntary delay of original U.S. applications and the mandatory delay of foreign-based applications.

James DeGiulio has a doctorate in molecular biology and genetics from Northwestern University and is a graduate of Northwestern University School of Law.  Dr. DeGiulio is a member of MBHB's 2010 associate class and he can be contacted at [email protected].

Comments

[Phanio]

There's a lot of talk on how excellerating patents could help kick start this economy as these firm would seek to hire to commercialize these assets.

[patent litigation]

Like the IPO, I generally favor the proposed three-track plan, as long as it does not increase the delay in processing ordinary patent applications. Until Congress passes some form of significant patent reform legislation, patent law will have to make slow progress in the form of such incrementalist measures by the USPTO.
http://www.aminn.org/webcast-aipr-patent-reform-presentation-us-patent-and-trademark-office