The U.S. Commerce Department’s United States Patent and Trademark Office (USPTO) today announced a proposed rule change with the publication of a Federal Register titled Changes to Implement Micro Entity Status for Paying Patent Fees. The Office seeks written comments no later than July 30, 2012.
The amend to the rules of practice in patent cases is for the purpose of implementing the micro entity provision of the Leahy-Smith America Invents Act (AIA). If an applicant qualifies as a micro entity, then the applicant is eligible to pay reduced patent fees once the USPTO exercises its fee setting authority under the AIA. The fee setting provision in the AIA sets the micro entity discount at 75% of the fees set or adjusted for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents.
“The new micro entity provision in the America Invents Acts makes our patent system more accessible for smaller innovators by entitling them to a 75% discount on patent fees,” said Under Secretary of Commerce for Intellectual Property and Director of the USPTO David Kappos. “By paying discounted patent fees as micro entities, smaller innovators can access the patent system to move their ideas into the marketplace and accelerate U.S. economic growth.”
The America Invents Act
The AIA, which was enacted on September 16, 2011, presents a major revision to the patent system. The most sweeping change — moving from a first to invent system to a first to file system — will not be accomplished until March 16, 2013. In the meantime, various provisions have already become effective, with the next set of provisions due to become effective on September 16, 2012. The USPTO is expected to release final rules relative to these September 2012 changes to the law sometime during the month of July 2012. This change to the fee structure to include a micro-entity for purpose of reduced fee payment is envisioned by the AIA and will become effective at some point during the first quarter of 2013.
The terms of the Leahy-Smith America Invents Act provided that the Patent Office has the authority to set or adjust any patent fee, provided that the revenue generated by patent fees recovers only the aggregate estimated costs to the Office for processing, activities, services, and materials relating to patents (including administrative costs). The AIA also continued to allow most fees set or adjusted by the USPTO to be reduced by 50%with respect to small entities and by seventy-five percent with respect to micro entities. The Leahy-Smith America Invents Act also added a new section the patent laws that defines a “micro entity.”
Generally speaking, a “micro entity” refers to an applicant that makes a certification that the application: (1) qualifies as a small entity; (2) has not been named an inventor on more than 4 previously filed non-provisional patent applications in the United States; (3) did not have a gross income that exceeds 3 times the median household income for that preceding calendar year; and (4) has not assigned, granted, or conveyed a license or other ownership interest in the application concerned to an entity that had gross income exceeding 3 times the median household income for the preceding calendar year.
Small Entity Status
The rules of practice currently have provisions pertaining to small entity status. A small entity can be any party, whether person, small business or non-profit organization. Individuals are considered small entities if they have not assigned, granted, or conveyed, or licensed any rights in the invention. A small business is considered a small entity if they have not assigned, granted, or conveyed, or licensed any rights in the invention and the business does not employ more than 500 persons. A non-profit organization qualifies as a small entity if they have not assigned, granted, conveyed, or licensed any rights in the invention and is either: (1) a university or other institution of higher education located in any country; (2) an organization of the type described in 501(c)(3) of the Tax Code and exempt from taxation under 501(a) of the Tax Code; (3) a nonprofit scientific or education organization qualified under a nonprofit organization statute of any state in the United States; or (4) a nonprofit organization located in a foreign country which would qualify as a nonprofit organization under (2) or (3). See 37 CFR 1.27.
The Proposed Rule Change
In order to effectuate the requirement of the AIA, the Patent Office is proposing changes to the rules of practice to set out the procedures for an applicant to claim micro entity status and to pay patents fees as a micro entity. The USPTO likewise is proposing changes to the rules of practice to set procedures for an applicant to notify the Office of the loss of micro entity status and to correct payments of patent fees erroneously paid in the micro entity amount.
The USPTO proposes to add a provision to the rules of practice pertaining to micro entity status. The provision will set out the requirements to qualify as a micro entity tracking the micro entity provision of Section 10 of the Leahy-Smith America Invents Act. The provision will also set out procedures relating to micro entity status that largely track the provisions in 37 CFR 1.27 for small entity status. These new procedures pertain to claiming micro entity status, paying patent fees as a micro entity, notifying the Office of loss of micro entity status, and correcting payments of patent fees paid erroneously in the micro entity amount.
The Specific Details
First, the Office does not plan to provide advisory opinions on whether a particular entity is entitled to claim micro entity status.
If an application names more than one applicant, each applicant must meet the requirements for the applicants to file a micro entity certification in the application.
The Office is developing both paper and electronic forms for use by members of the public to provide a certification of micro entity status.
The procedures for claiming micro entity status require the filing of a certification of entitlement to micro entity status. The Office does plans to rely upon the applicant’s certification of micro entity status (except where it conflicts with the information contained in the Office’s records, such as where Office records indicate that the applicant is named as an inventor on more than four previously filed and unassigned nonprovisional patent applications) and will not require any additional documents from the applicant concerning the applicant’s entitlement to claim micro entity status.
The procedures for paying fees as a micro entity provide that a micro entity certification need only be filed once in an application or patent, but that a fee may be paid in the micro entity amount only if the applicant or patentee is still entitled to micro entity status on the date the fee is paid. The procedures pertaining to notifying the Office of loss of micro entity status and correctingpayments of patent fees paid erroneously in the micro entity amount track the corresponding small entity provisions for notifying the Office of loss of small entity status and correcting payments of patent fees paid erroneously in the small entity amount.
Any attempt to fraudulently or improperly (i.e., with deceptive intent) establish status as a micro entity, or pay fees as a micro entity, shall be considered as a fraud practiced or attempted on the Office.
If status as a micro entity is established in good faith in an application or patent, and fees as a micro entity are paid in good faith in the application or patent, and it is later discovered that such micro entity status either was established in error, or that the Office was not notified of a loss of entitlement to micro entity status as required by paragraph (i) of this section through error, the error will be excused upon compliance with the separate submission and itemization requirements and the payment of the deficiency owed.
The comment deadline is July 30, 2012.
Comments should be sent by electronic mail message over the Internet addressed to: firstname.lastname@example.org. Comments may also be submitted by postal mail addressed to: Mail Stop Comments—Patents, Commissioner for Patents, P.O. Box 1450, Alexandria, VA 22313-1450, marked to the attention of James Engel, Senior Legal Advisor, Office of Patent Legal Administration, Office of the Deputy Commissioner for Patent Examination Policy.
For further information contact James Engel, Senior Legal Advisor (571-272-7725), Office of Patent Legal Administration, Office of the Deputy Commissioner for Patent Examination Policy.