Want to Increase Your Chance of Allowance by 19 Percentage Points? That’ll be $4,000

By Austin Underhill
June 17, 2015

arrow-up-business-lightening-335Attorneys have long suspected that Track One applications are more likely to get an allowance. Up to this point, however, it was mere speculation. Here at Juristat, we like to make data-driven decisions. That’s why we decided to test this hypothesis. It turns out that Track One applications are 19 percentage points more likely to receive an allowance than standard applications.

As a refresher, the USPTO’s Prioritized Patent Examination Program, widely known as Track One, took effect on September 26, 2011 as part of the America Invents Act (AIA). Under the program, the USPTO promises a final disposition in “about 12 months” for applicants willing to pay the additional $4,000 filing fee ($2,000 for small entities). To be eligible for Track One examination, an application can have no more than four independent claims and 30 dependent claims. Moreover, there can be no multiple dependent claims. The downside is clear: $4,000 is a significant sum. However, some benefits are also clear. Particularly, prioritized examination typically cuts pendency by several years. That promise alone is extremely valuable to many applicants. With that said, it seems there are other significant benefits to prioritized examination.

Figure 1

Average Time to First Exam

Let’s start with the obvious: Track One applications are reviewed much more quickly. On average, these applications reach first exam in 133 days. Standard applications take 697 days. Put another way, Track One applications are reviewed, on average, about 1.5 years earlier than their counterparts.

Average Time to Allowance

Also not surprising is the fact that successful Track One applications reach allowance faster than standard applications. In fact, on average, eligible applications are allowed 599 days earlier than standard applications. As above, this result was expected. After all, expediency is the point of the accelerated program. Clearly, if speed is essential, Track One is a great option.

RCE Win Rate

With regard to RCEs, Track One applications and standard applications are essentially equal. The win rate for Track One applications on RCE is 45%. Compare that with 43% for all other RCEs. Because these rates are so similar, an appeal may be a better option for Track One applicants.

Appeal Reversal Rate

Track One applications outperform standard applications on appeal. On average, examiners are reversed in 97% of Track One appeals. For non-Track One applications, that number is 84%. The difference here is incredibly significant. This 13% spread should not be overlooked. If a prosecution team anticipates an appeal, Track One may be well worth the additional $4,000 for this reason alone.

Average Allowance Rate

Perhaps the most shocking difference between Track One applications and standard applications is allowance rate. Standard applications have an allowance rate of 70%; however, Track One applications are approved 89% of the time. Put another way, a Track One application is 19 percentage points more likely to receive an allowance than a standard application. That’s a staggering spread. We identified three possible explanations for this:

  1. Track One actually increases an applicant’s chance of allowance by 19 percentage points, so more people should apply for prioritization;
  2. Stronger applications are more likely to be filed under Track One, thereby inflating the allowance rate (in other words, there’s a selection bias); and/or
  3. Track One applications are commonly assigned to easier examiners.

We decided to dig deeper into the last point. To do so, we considered all examiners who’ve examined at least one prioritized application and 50 applications total. Based on these criteria, the average allowance rate for this group of examiners was 65%. That’s lower than the USPTO average of 70%. This rules out point three—that Track One applications are assigned to easier examiners. Nevertheless, it’s possible that inventors with stronger applications are more likely to pursue Track One. We plan to address this possibility in a future update.

Takeaway

Not only are Track One applications reviewed more quickly, they are more successful on appeal. Furthermore, these applications are 19 percentage points more likely to receive an allowance. Ultimately, selection bias aside, the question is whether inventors are willing to pay $4,000 for this increased chance of success.

A Quick Note about Methodology

The Track One data reflects the averages of all applications included in the program since its inception. The data for standard applications reflects the averages from a random sample of such applications.

All timing data is calculated based on filing and mailroom dates. More specifically, time to first exam represents the number of days between the filing date and the mailroom date associated with the first office action. Time to allowance is the number of days between the filing date and the mailroom date associated with the notice of allowance.

Finally, allowance rate is calculated by dividing the total number of allowances by the sum of the total number of allowances plus the total number of abandons.

The Author

Austin Underhill

Austin Underhill is a Legal Analyst at Juristat, a legal tech company that develops predictive models on the behavior of judges, patent examiners, attorneys, and other entities. Juristat is used by Fortune 500 companies, NLJ 250 law firms, and boutique firms around the country. Austin is a licensed attorney and a 2013 graduate of Chapman University’s Fowler School of Law. He writes extensively for the Juristat’s blog.

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 14 Comments comments.

  1. Curious June 17, 2015 1:53 pm

    Track One applications outperform standard applications on appeal. On average, examiners are reversed in 97% of Track One appeals. For non-Track One applications, that number is 84%. The difference here is incredibly significant.
    That reversal rate for non-Track One applications does not look right. The affirmance rate (on all claims) of an Examiner is usually around 50%. What kind of sample size are you using?

    Regardless, I am inclined to believe that the filing of a Track One application is not as impactful to allowance rates as the decision process involved in selecting an application for Track One.

    Also, in today’s anti-patent environment, I would rather have my patent sit at the USPTO (while piling up patent term adjustment) rather than issue earlier. I can make adjustments (as necessary) to the claims based upon the latest court decisions (who cannot resist monkeying with long-settled law). Also, I have more opportunity to see competitor’s products and adjust the claims accordingly.

    To the extent somebody wants to get a patent issued earlier, then Track One is a no-brainer. However, I would not count on Track One providing more benefits than that.

  2. patent leather June 17, 2015 3:49 pm

    There is another explanation for the higher allowance rate. Examiners are under higher time pressures to get Track 1 actions out. After the first office action is sent and the applicant files their first amendment, the examiner has less time for a track 1 application than for a standard application (I think the examiner has one month but I am not sure). If time is running out for the examiner to respond to the amendment, then what is an examiner more likely to do? allow it? or do more searching and write up another rejection.

  3. Momo June 17, 2015 5:05 pm

    Please define “RCE Win rate”

    Is this “Allowance after Final”?

  4. Momo June 17, 2015 5:07 pm

    A 4th explanation is that applications fall out of Track 1 once you take an RCE.

    So, I was under pressure from clients to “make a deal” before an RCE. The client would then file an CON. The nice thing I noticed anout Track 1 was it tended to pull related applications (CONs/DIVs) along with it. Once the Examiner had picked up a Track 1 App, they would also pick up the related apps very quickly.

  5. Fish Sticks June 17, 2015 6:25 pm

    Maybe practitioners are more motivated to structure the claims for early allowance when they file Track One.

  6. Curious June 17, 2015 11:13 pm

    If time is running out for the examiner to respond to the amendment, then what is an examiner more likely to do? allow it? or do more searching and write up another rejection
    Do what they always do … spend about an hour to write “Applicant’s arguments have been considered but deemed unpersuasive,” add a couple of paragraphs in the “Response to Arguments” sections, make the Office Action final, and move on to the next case.

  7. Curious June 17, 2015 11:20 pm

    Maybe practitioners are more motivated to structure the claims for early allowance when they file Track One.
    I have filed more than a handful of Track One applications and I think all of them were continuations. Moreover, almost all of them were expected to be allowed in the first action (and they were).

    All track one does is get your to a “final disposition” within 1 year — a final disposition can mean a final office action. After that, nothing changes, so if you want to appeal, you are still looking a the 3 year backlog at the PTAB (plus the 9-12 months from the date of the final office action to when the Reply Brief is filed and the appeal is forwarded to the Board).

  8. patent leather June 17, 2015 11:43 pm

    @Curious: LOL. Fortunately, SOME examiners do try to issue good rejections. The info in my post came straight from an examiner.

  9. Pro Se June 18, 2015 8:13 pm

    A warning: if you try a Track One on a continuation while an IPR is pending, file it with a non-publication request because I was told by a SPE that the PTO does not like these kind of applications that force examinations. Meaning, the examiners are encouraged to shelf examinations of continuation of parent IPR patents until the IPR process is complete. With a Track One application of this type, they will find a reason to 103 reject the variation of claim in the continuation that you just may have won on a first action allowance on just the last parent case…

    They will switch an examiner that granted you your last patent family members to a new examiner with the focus of eliminating the attempt to further patent rights of IPR related art.

  10. T2 June 19, 2015 3:19 am

    Those in a rush to get a decision may also be okay with reduced scope; and so it would be interesting to compare proxys of importance or commercial relevance, such as citations or % litigated.

  11. Anon June 19, 2015 8:54 am

    T2,

    There are patent strategies extant that embrace the quick and reduced scope without sacrificing the long (and larger scope) game. The ability to have continuations and “keep alive” the wider scope provides the opportunity – if desired – to obtain a quick limited patent. This was perhaps more meaningful when the marking sections of the law had real teeth, or perhaps in those situations involving corporate funding rounds in which a patent portfolio was discounted until at least one family member was granted.

    In today’s world (as witnessed by the failed attempt of Michel/Kappos), I see the relevancy of having that quick first patent diminished. I am not yet at the point of dismissing this strategic angle, and I am not sure that the “long game” alone is long enough to see the pendulum swing back into pro-patent territory, but the short game is excessively treacherous to patent rights to risk putting a single-patent holding into play, or even risk putting the “best” of a family into play, at least, this is my view given the extreme uncertainty of “judicial involvement,” as well as the perhaps precipitous end of the AIA, given pending (and future) cases questioning constitutionality of certain sections and the fact that Congress choose not to have a separability clause in the AIA.

  12. T2 June 19, 2015 5:26 pm

    Anon,

    Thank you for your thoughts. Though ‘a bird in the hand is worth two in the bush,’ I too wonder about how much of value difference exists between issued patents vs pending applications. The recent changes in the field, especially those related to patentable matter, may be generally driving down patent values (for pre-decision patents) while encouraging piecemeal filings. I seem to recall Gene predicting such in earlier columns, as well as businesses choosing to keep certain things trade secrets for longer, given a conducive sector and circumstance of course.

  13. Anon June 19, 2015 7:46 pm

    Indeed T2, the trade secret path is a definite discussion point (with a much greater emphasis) when I counsel clients.

  14. STH June 20, 2015 8:05 pm

    From the other side, I’ve found that Track 1’s generally reach allowance more quickly and more often because applicants actually follow the advice given in MPEP 708: they file their application with “claims from the broadest to which the applicant believes he is entitled in view of the prior art to the narrowest which the applicant is willing to accept”. Almost all the Track 1 applications I’ve allowed presented allowable subject matter in the initial claims. On the other hand, for almost all the non-prioritized cases I’ve allowed, the allowable subject matter was buried in the specification, and we didn’t find it until after several rounds of examination. Had the applicants started off with the narrowest claims they were willing to accept, we’d have gotten to allowance that much more quickly.