75% – The Real Rate of Patent Applicant Success on Appeal

By Kip Werking on May 2, 2012

The biggest myth about patent appeals is that that the examiner usually wins.  The Patent Trial and Appeal Board (“Board”) posts that it reverses examiners only one out of every three decisions —33%.  That number is accurate, and reflects the percentage of reversals among Board decisions.  But another number is more helpful — 75%.  That is the rough percentage of reversals among all appeals—not just Board decisions.  The difference arises because not all appeals result in a Board decision.  In fact, the vast majority of appeals (80%) never reach the Board.  The Board’s 33% number has nothing to say about this invisible sea of patent appeals.

Often I hear seasoned patent practitioners hesitate to appeal because they are worried about the low rate of success on appeal.  They are scared by the 33% number.  For example, a recent IP Today article cautions that “61% of [obviousness] rejections were fully affirmed,” based only on the 20% of appeals resulting in a Board decision (see Appeals and RCEs – the Frequency and Success of Challenges to Specific Rejection Types).

In contrast, Chris Holt and I derived the overall 75% success rate number using the groundbreaking PatentCore™ database (Chris is CEO of PatentCore).  This database includes about 2 million file histories.  PatentCore provides detailed appeals statistics for every examiner and art unit in the PTO.  Just type in the examiner name or art unit number, and PatentCore provides instant and updated statistics.  Art unit 2114 is representative:

For Board decision statistics, PatentCore reports the same values that the Board does.  For art unit 2114, applicants won 50% of the appeals that went to the Board (green box).  But this 50% number for art unit 2114, like the 33% average for the entire PTO, is misleading.  The 50% number does not reflect all of the appeals that applicants win before appeals reach the Board (pink boxes).  For example, after filing an appeal brief, applicants won 37 different times without ever going to the Board!  The 50% number, like the 33% number, does not reflect any of these invisible victories.  For art unit 2114, the Board’s success rate (50%) is based on just 12% of all appeals filed—88% of appeals never even see the Board.  When the remaining 88% of appeals are added into the equation, applicants won 73% = (66 / (66+25)) of the time (red box).  Notably, appeals that succeed without reaching the Board generally last for months, not years.

As soon as PatentCore’s new appeals statistics went live, I checked the statistics for the art units that I work with:

As shown, the average rate of success on appeal for these art units is 79%.  I expect the average for all art units to be very close to that number.  Indeed, the standard deviation among the above art units is only 7%, which is remarkably small.

Of course, there are limitations to the PatentCore data.  For one, PatentCore cannot correctly categorize all appeals.  As shown in the screenshot above, some appeals were categorized as “undetermined.”  PatentCore excluded these mysterious appeals from the statistics.  Manual inspection shows that the vast majority of these undetermined appeals are simply pending appeals with unusual histories.  PatentCore cannot always correctly process certain abnormalities (e.g., defective briefs, supplemental examiner answers, letters of suspension).  Because the vast majority of these undetermined appeals are still pending, PatentCore properly excludes them.  PatentCore is also constantly improving and will soon approach eliminating the “undetermined” category.

Second, PatentCore has no access to unpublished applications.  Nevertheless, reportedly less than 10% of applications have non-publication requests.  And only a smaller subset of the 10% never results in a patent.  So this smaller subset of cases should not greatly disturb the overall statistics.

In view of these limitations, we estimate that 75% of appeals are successful.  We further estimate a ±7% standard of error.  These numbers are consistent with the Board’s own reported statistics in the 2010 Notice of Proposed Rulemaking.  They are also consistent with information retrieved from Freedom of Information Act Requests in 2008.

The appellant’s chances of winning were not always 75%.  Before 2004, most appeals went to the Board.  Even though most appeals went to the Board, the Board’s reversal rate remained similar to its current 33% rate.  But something changed in 2005.  Ron Katznelson has documented the explosion after 2005 of appeals failing to reach the Board:

Source: Ron D. Katznelson. "Patent Reforms Must Focus on the U.S. Patent Office" Medical Innovation & Busniess Journal, Vol. 2, No. 2, pp. 77-87 (Summer 2010). Available at http://bitly.com/MIBJ-PTO-Reform. Courtesy Lippincott Williams & Wilkins.

From 1995-2003, most appeals (dark line) went to the Board (light line).  After 2004, these lines diverged dramatically.  Appeals that never reach the Board do so mostly because the examiner preemptively concedes the appeal at the appeal brief conference stage.

What changed in 2005?  Ron Katznelson argues that the PTO began issuing more grounds of rejection, while filtering appeals more aggressively in the appeal brief conference program.  The change appears to be attributable to the Dudas and Doll administrations (see Katznelson’s Patent Reforms Must Focus on the U.S. Patent Office).  Regardless of how the success rate drifted from 33% to 75%, it is important for both the PTO and the patent bar to address that reality.

Attorneys need an accurate view of the success rate on appeal.  Seasoned attorneys who have practiced before the Board for decades might not fully appreciate how things changed in 2005.  These attorneys might be scared of the 33% number, which was useful prior to 2005.  As explained above, the 33% number is less relevant today.  Instead, applicants have about a 75% chance of success on appeal.  All else being equal, if the examiner rattles her saber by making a questionable final rejection, call the examiner’s bluff and enter the appeal process.

Note: The author thanks Chris Holt for his assistance in preparing this article.

The Author

Kip Werking

Kip Werking is a registered patent attorney with ALG Intellectual Property, LLC who has a wealth of patent-prosecution experience in the electrical and computer-engineering arts. Throughout his career, Mr. Werking has participated in all aspects of U.S. patent prosecution, including hundreds of in-person examiner interviews at the U.S. Patent & Trademark Office, appeals, and personal appearances before the Board of Patent Appeals and Interferences.

Prior to joining ALG, Mr. Werking practiced as a patent attorney with a nationally recognized law firm in Alexandria, Virginia. Mr. Werking also clerked for the International Trade Commission in Washington, D.C.

Professional Activities
Registered Patent Attorney, U.S. Patent & Trademark Office
Member, Virginia State Bar (Inactive Status)

Education
William & Mary School of Law, J.D.
Graduate Fellow
The University of Texas at Austin, B.S
Electrical Engineering
National Merit Scholar
Engineering Scholar

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 12 Comments comments.

  1. Anon May 2, 2012 11:50 am

    Wow.

  2. Patent Guy May 3, 2012 4:54 pm

    Just so we’re clear, what you’re saying is that an application receiving two re-openings from two PABCRs and then proceeding to appeal on the third try, where all rejections are affirmed, would be a 33% win rate under your method. I’d count that as a 100% win rate for the Board and a total loser for applicants. Put another way, you should be measuring how many applications are allowed after filing the notice of appeal, not any reopening.

  3. Stan E. Delo May 3, 2012 4:58 pm

    Wow indeed Anon-

    A bit expensive for those operating on a limited budget, unless they are very careful to present an application that is well considered and written. My patent agent has an approval rating of 90% or more, and it is not because he is writing whimpy patent applications with worthless claims. See Turbine with Automatically Adjusting Pitch about two years from now.

    SD~

  4. Kip May 4, 2012 7:04 pm

    “Just so we’re clear, what you’re saying is that an application receiving two re-openings from two PABCRs and then proceeding to appeal on the third try, where all rejections are affirmed, would be a 33% win rate under your method. I’d count that as a 100% win rate for the Board and a total loser for applicants. Put another way, you should be measuring how many applications are allowed after filing the notice of appeal, not any reopening.”

    That would be a 33% win rate for the PTO, yes.

    You say that it should be a 100% win rate, but that ignores the two previous appeals that the Applicant won. There’s no good reason to ignore those, when you are trying to decide whether to appeal.

  5. Stan E. Delo May 4, 2012 7:33 pm

    Kip-

    Isn’t attributing win rates to either party perhaps a bit counter productive? What constitutes a Win for the USPTO? Less possible patent rights for the innovator?

    A chicken or egg sort of thing I would guess, where the USPTO wouldn’t exist without American inventors, and American inventors would become obscure very quickly if the USPTO happened to drop the ball again like it did during the Dudas-Doll era.

    Very interesting article.

    Stan~

  6. Kip May 10, 2012 12:24 pm

    Stan,

    I only meant that the PTO “wins” in the sense that the Appellant is challenging the Examiner’s work, but the Examiner is vindicated on appeal – “winning.” I agree that it is usually most helpful to approach prosecution from a constructive, and non-adversarial, perspective. By the time you enter appeal, however, that constructive dialogue has usually broken down for some reason.

    Also, you’re right that the PTO has a financial interest in granting patents (at least through maintenance fees). There are some excellent law review articles on this phenomenon. PTO management has also issued some great presentations/slides on PTO revenue sources.

    Kip