In June of 2014, the Supreme Court held, in Alice Corporation Pty. Ltd. v. CLS Bank International (“Alice Corp.”), that claims directed to a technique for mitigating settlement risk failed to comply with the patentable-subject-matter requirement of 35 U.S.C. 101 (“101”). Alice Corp. involved four patents that had been assigned to business-method art units (characterizing business-method art units as 3621-29, 3681-89, 3691-95 and those in former technology center 2700). The Court found that the claims at issue were directed to an abstract idea and did not sufficiently transform the idea to become a patentable invention.
One question is whether Alice Corp., in essence, strips patent prospects from business-method inventions. Another question is whether the analysis in Alice Corp. will invalidate patents in other areas under 101. The author thus examined all cases citing and/or including Alice Corp. and identified outcomes of analyses of compliance with 101. Further, the patents at issue were segregated based on the technology center to which the corresponding patent application had been assigned and/or whether it was assigned to a business-method art unit.
This summer, the United States Patent and Trademark Office (PTO) responded t0 Alice Corp. by issuing Preliminary Examination Instructions in view of the case, and impact on examination of business-method patent applications was essentially immediate. Using LexisNexis PatentAdvisor, data was collected for a January time period (January 13-27, 2014) and July time period (July 13-27, 2014) that identified, for each Office Action issued during the time period, whether the Action included a 101 rejection and the corresponding art unit.
A typical General Counsel will see a variety of patent demand letters, at least some of which are legitimate and some of which are the type of bogus demands that are so vilified in the media and on Capitol Hill. A problem for many in house attorneys, particularly those who are themselves not technology companies but are technology users, is shifting through to determine which patents pose a real risk and which letters need to be taken seriously because the patents strong, high quality and likely to be litigated.
The terms patent strength and patent quality get used frequently within the industry, but what do they really mean? To a large extent the meaning of the terms depends on your viewpoint. The United States Patent and Trademark Office has historically employed a variety of quality metrics, but is a patent that is considered high quality from the perspective of the USPTO a strong patent, or a patent that the industry would view as a high quality patent, or one that would be viewed to be a valuable patent?
Whether we like it or not, the value of a patent is related to the likelihood that it could be successfully enforced in litigation. The value of the patent is also a function of the likely damages that could be obtained in litigation, which is related to the contributions made by the innovation underlying the invention disclosed in the patent. But the overwhelming number of patents are not litigated or licensed. In fact, by some estimates less than 5% of patents will ever be licensed or litigated. Indeed, even in a portfolio that is licensed there will be a handful of anchor patents that are of primary importance, with the remainder of the portfolio there to create volume, or safety in numbers.
By agreement signed with the Patent Office Professional Association on June 24, 2014, the United States Patent and Trademark Office is once again providing tuition reimbursement for employees who are enrolled in law school seeking a Juris Doctor degree. See 2014 Supplemental Agreement on the Non-duty Hours Legal Study Program. To qualify the employee must have at least 2 years of USPTO experience and sign a continuing service agreement.
The continuing service agreement requires an employee who received tuition reimbursement to provide continued service with the federal government for 30 days for each credit paid for by the USPTO. If the employee leaves the federal government prior to completing the required length of the continued service, the employee’s tuition reimbursement obligation will be on a pro rata basis (based on thirty-day increments).
A friend who handles large numbers of software patent applications for some of the most elite technology companies sent me an e-mail late last week about what he has already started seeing coming from patent examiners. He says he has seen the below form paragraph twice within a week. Most alarming, in one case the form paragraph came in the form of a supplemental office action, but the outstanding original office action didn’t have any patent eligibility rejections under 35 U.S.C. 101.
Claims… are rejected under 35 U.S.C. 101 because the claimed invention is directed to non statutory subject matter. In the instant invention, the claims are directed towards the concept of… [This] is considered a method of organizing human activities, therefore the claims are drawn to an abstract idea. The claims do not recite limitations that are “significantly more” than the abstract idea because the claims do not recite an improvement to another technology or technical field, an improvement to the functioning of the computer itself, or meaningful limitations beyond generally linking the use of an abstract idea to a particular technological environment. It should be noted the limitations of the current claims are performed by the generically recited processor. The limitations are merely instructions to implement the abstract idea on a computer and require no more than a generic computer to perform generic computer functions that are well-understood, routine and conventional activities previously known to the industry. Therefore, claims… are directed to non-statutory subject matter.
Did you notice the circular logic? The claims are abstract because the claims do not recite limitations significantly more than an abstract idea. Truthfully, this rather ridiculous logical construct can’t be blamed on patent examiners when the Supreme Court refuses to provide a definition for what is an abstract idea.
Mark Twain wrote that a country without a good patent system is doomed to go only sideways and backwards.
Recently when looking at some new Hewlett-Packard patent applications and patents we stumbled on an interesting patent that issued on April 22, 2014. U.S. Patent No. 8694327, entitled Electronic Warranty System and Method, protects a method of applying a warranty to printer cartridges so that the warranty data is stored within the printer itself. This system offers a major improvement over organizational shortcomings to traditional warranties, or at least it did back when it was filed in 2002.
When reading patents it is not at all unusual for a patent to be issued a number of years after the original patent application was filed, but it isn’t every day that you see a patent issue more than 12 years after it was originally filed. Yet, that was exactly what happened with respect to the ‘327 patent application to HP. Worse yet, after HP successfully prevailed on claims in an appeal to the Board the case goes back to an examiner who for the first time raises a rejection never before made, while still continuing to make additional obviousness rejections. In short, this reads like the story of an application that examiners never wanted to issue in the first place.
Had the applicant been a small entity or individual it wouldn’t have issued. It would have been buried. Once upon a time Directors and Commissioners of the Patent Office used to believe that burying an application that should issue was as bad, if not worse, than allowing an application that shouldn’t have issued. Oh how the times have changed in this anti-patent world in which we live where it is better to not issue patents that should issue as long as we don’t accidentally issue something that might be embarrassing. And we seriously wonder why it feels like a recession never ended?
The United States Patent and Trademark Office (USPTO) is seeking to hire patent examiners for the Denver Satellite Office. There are openings currently for patent examiners with a computer engineering background, patent examiners with an electrical engineering background and patent examiners with a mechanical engineering background. For more information see USAjobs.gov.
On Friday March 7, 2014 and Saturday March 8, 2014, the USPTO will host a career fair at the Hyatt Regency Denver Convention Center downtown at 650 15th Street. The Office will hold ongoing information sessions and then meet with individuals who meet the basic Patent Examiner position requirements. Those who qualify will be encouraged to apply via USAJobs. Candidates cannot be officially considered for open positions without submitting a complete application.
Those wishing to attend the March 7 or March 8 career fair should register in advance because space is limited, particularly for the direct informational meetings with USPTO personnel. Walk-ins will be allowed to participate if space is available. To register CLICK HERE.
Many factors can influence prosecution strategies and decisions. For example, take a look at the chart below:
You do not have to look hard to find an example such as the one shown here. Over a period of about a year and a half, the applicant negotiated through a non-final action and then abandoned the application. The patent examiner assigned to the case on average issues a Notice of Allowance at approximately three years and five months. Might the applicant have obtained allowance had they hung on a little longer?
There is no way to know for sure whether the applicant could have achieved an allowance had they hung in, but it would have been helpful to know that the examiner was very experienced and likely had decision making authority. Such an observation would have given great insight into the fact that the examiner in question here has an overall allowance rate of nearly 70%. It no doubt would have also been helpful to know that after an interview in over 50% of cases, the next significant event following the interview was an allowance. In short, the statistical data shows that this was an experienced patent examiner who is interested in working with applicants and their representatives to identify allowable subject matter and issue patents where appropriate.
Last week the United States Patent and Trademark Office (USPTO) announced in the Federal Register that it would modify the After Final Consideration Pilot Program (AFCP) to create an After Final Consideration Pilot Program 2.0 (AFCP 2.0). The goal of AFCP 2.0 is much the same as it was when the USPTO initially introduced the precursor AFCP. According to the USPTO, the goal of AFCP 2.0 is to reduce pendency by reducing the number of RCEs and encouraging increased collaboration between the applicant and the examiner to effectively advance the prosecution of the application. Thus, this can and should be viewed as part of the USPTO effort to continue to try and address the RCE problem.
AFCP 2.0 began on May 19, 2013 and will run through September 30, 2013. The USPTO says that any request for participation in the program must be filed on or before September 30, 2013. Of course, as is always the case, the USPTO left open the possibility that the pilot would be extended beyond that date.
After providing the filing I explained that there are better ways to approach the situation, but I also looked into some publicly available statistics to see whether there was any explainable frustration that may have been experienced by this attorney. That part of the article looking at the statistics painted an inaccurate and unfair picture. I write today to set the record straight.
The examiner who was sent this inappropriate filing is a junior examiner — Examiner Valvis — who has been with the Patent Office only 8 months. In the article I suggested that there was reason for frustration. What I inartfully was trying to say was that at first glance there seemed to be a reason to be frustrated because in the database consulted there was no evidence of any patents being issued in 66 applications worked on. I then said: “But with only 66 applications total that might not be surprising.” It isn’t surprising because new examiners begin work on new cases and most cases are not allowed on a first office action. So someone who has only 66 applications was clearly a junior person and the pool simply too small to draw any conclusions one way or another.
EDITOR’S NOTE: An earlier version of the article below contained inaccuracies. It was erroneously stated that SPE Len Tran had not allowed any applications since 2008. As a supervisor he oversaw the work of Junior Patent Examiners and was the decision maker on hundreds of patents since 2008.
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There is a story circulating the Internet over the last few days about an alleged filing with the USPTO. I initially decided to ignore this for several reasons. First, it is impossible for me to believe that a patent attorney actually filed this with the Patent Office, although I could see it being put together for internal use as a cathartic exercise. Second, alleged filing is dated April 24, 2013, but still does not show in Public PAIR. Third, the Art Unit listed in the heading of the alleged filing is Art Unit 4188, which does not coincide with the Art Unit according to the final rejection (i.e., the final rejection comes from Art Unit 3752). Thus, I have my suspicions about the authenticity, but on Monday CBS News published an article discussing this alleged filing under the title The letter to the Patent Office you have to read. So the matter is now out in the open.
Perhaps this really was filed, who knows. If it was filed we will eventually be able to find a copy of the filing on Public PAIR. In the meantime I’m going to continue to refer to this as an alleged filing. Notwithstanding, here the colorful comments from the Remarks section, which seem to be the only thing that makes up the filing.
The United States Patent and Trademark Office (USPTO) has made great strides over the last several years, there is no doubt about it, but there is still work to be done. The patent system was collapsing under the crushing weight of an ever increasing demand for U.S. patents, antiquated computer systems and policies that lead to second guessing every allowance. This crippled the Patent Office. The Patent Office is better today than it was at the end of the Bush era, but the USPTO has a problem; a very big problem.
At the end of a patent application proceeding (a process known as “prosecution”) there are a number of possible outcomes. A patent can be granted on all of the claims sought, which is rare but not unprecedented. See Patent Bigfoot: The Mythical First Action Allowances. The applicant can give up and not respond to a final rejection for one reason or another, perhaps because the patent examiner has found strong prior art that will be difficult to overcome. Still further, allowed claims can be accepted, rejected claims canceled and a patent issue. In this last scenario the patent application can pay the issue fee, accept the patent and file a continuation or continuation-in-part pursuant to 37 CFR 1.53(b) in order to seek other claims on the disclosure.
But what if the patent prosecution results in no claims allowed? In this scenario, which is unfortunately far more common than either the patent bar or Patent Office would like, the procedural vehicle of choice is a Request for Continued Examination (RCE) under 37 CFR 1.114. An RCE can be filed in situations where claims are allowed, but they are far more common in the scenario where all claims are rejected because with an RCE, which is not considered a new patent application and will have the same serial number as the previous application, all claims go back into prosecution. That means both allowed claims and rejected claims are back on the table during prosecution. That can be dangerous when claims are allowed because patent examiners are known to reject previously allowed claims in an RCE.
Reed Technology and Information Services Inc., a part of the LexisNexis® family and a provider of content management services, announced earlier today that it has joined forces with PatentCore. You may recall that PatentCore is a publisher of online Patent Office analytics, which for the first time has given the patent bar and public a snapshot look at what goes on inside the Patent Office Art Unit by Art Unit and patent examiner by patent examiner.
Reed and PatentCore have recently launched of Reed Tech PatentAdvisorTM information services, a family of on-line data intelligence tools for patent professionals.
PatentAdvisor™ provides patent professionals the ability to make analytics-driven strategic decisions based on predictable patterns demonstrated by the more than the 7,500 U.S. patent examiners during patent prosecution. Presently, PatentAdvisor™ provides patent professionals with strategic insight based upon information gleaned from an analysis of more than 5 million patent applications, with more applications being added continually. If you are interested sign-up for a 2-day free trial to test drive PatentAdvisor™ and see for yourself.