Posts Tagged: "patent fees"

Some businesses, as a result of the pandemic, have been pressed to discontinue manufacture or sale of products or have otherwise limited the scope of their business activities. As a result, in 2020 the use of one or more of the trademarks owned by your business may have stopped. Under U.S. trademark law, in the fifth year of a trademark registration term, and every ten years thereafter, a post-registration maintenance filing at the USPTO is required (e.g., evidence and a sworn statement about continuous trademark use in U.S. commerce). If sustained discontinuity of trademark use has occurred what options are available to keep a trademark registration active?

You get what you pay for, and C-level executives that play the role of bean-counter and only see that they are saving money today without any consideration of the damage they are doing long-term to their patent portfolios will wind up doing real, lasting and severe damage to their corporations. It is just that simple. The Supreme Court and the Federal Circuit have simply created too many impediments to obtaining and keeping a patent to justify the expense of spending any part of a budget on anything other than a patent that is done properly. So, you might think you are saving money by slashing patent attorneys fees yet again this year, but what you are doing is wasting every dollar you spend.

The original patent law passed by Congress on April 10, 1790 deliberately set patent fees to a level any ordinary citizen could afford — initially $3.70, but three years later raised to $30. This was still less than 5 percent of the rate in Britain. Patent fees remained $30 for the next seventy years, ensuring that virtually any citizen could participate in the industrial revolution.

The USPTO issued a final rule to set or adjust certain patent fees as the agency is authorized to do under the America Invents Act (AIA) of 2011. The fee increases, which include some significant increases to petitioners filing for inter partes review (IPR) proceedings, are ostensibly meant to cover costs for USPTO operations, Patent Trial and Appeal Board (PTAB) operations and administrative services as the USPTO attempts to achieve strategic goals including backlog reductions and “patent quality enhancements.”… The OMB’s determination of the new fees as a “transfer payment” means that the rule isn’t subject to the requirements of Executive Order 13771, titled Reducing Regulation and Controlling Regulatory Costs and signed on January 30th of this year.

Inasmuch as the new Director can change, or do whatever they want once in the job, and will be subject to political winds, I thought I’d just tell them what I want and why. Simple. Here’s my list. First, believe in your product and the team that produces the product. Stop the labeling of “legitimate patents” as compared to other, presumably, “illegitimate patents”. There is only one type of patent, the one produced by the PTO. End of story. Each receives the examination it can in light of the fees paid. Each examination is done according to the laws and rules set forth in the statute and in accord with the CAFC administration of that statute vis-à-vis the PTO. This is true across all technologies. Examiner’s do the best they can with the tools available. This includes training, searching, and examining. The PTO does not favor one group over another. It calls balls and strikes in light of the relevant statute or rule.

In prepared remarks Director Lee said the Office must significantly raise Patent Trial and Appeal Board (PTAB) fees in order for the PTAB to be self-sustaining on a going forward basis. On one hand the fact that Director Lee acknowledged that the PTAB is not self-funding is significant, but her comments dramatically under played what seems to be really happening at the PTAB. The reality appears to be that patent owners and patent applicants are subsidizing the PTAB… [I]t seems the PTAB has been operating at a substantial deficit for some time and even with significant fee increases the Office continues to plan to run PTAB trials at a deficit, which means patent owners and patent applicants will be subsidizing the PTAB and infringers challenging patents moving forward. To call this outrageous is an understatement.

With a proposed budget of $7.8 billion and $1 billion in cuts to identify, questions arise about where those cuts will come. Is the USPTO budget safe?Will the cuts be across the board cuts with the USPTO being asked to account for 35% of the $1 billion, which would reduce the USPTO budget to $2.967 billion for FY 2018? According to a chart prepared by the Intellectual Property Owners (IPO) Association, the largest single fee diversion came in 2011 when $209 million was diverted from the USPTO. If the USPTO must cut its budget by some $350 million that would far and away be the largest single year fee diversion in the history of the U.S. patent system.

At the quarterly PPAC meeting, USPTO Deputy CFO Frank Murphy (listed on the agenda as Acting CFO) stated that USPTO is moving forward with its proposed $710 million fee increase, despite the Trump’s ‘One-In Two-Out’ Order. PPAC Member Bernie Knight (former General Counsel of USPTO) then asked Mr. Murphy whether the $710 million fee increase is subject to Trump’s ‘One-In Two-Out’ Order. Mr. Murphy responded that he does not believe the $710 million fee increase is subject to Trump’s ‘One-In Two-Out’ Order because, in his view, it is not a “new” regulation but rather is an “amendment” to an old regulation. Mr. Murphy also responded that, even if the $710 fee increase were subject to Trump’s ‘One-In Two-Out’ Order, the USPTO would look to eliminate two regulations in other agencies within the Commerce Department, not the USPTO’s own regulations. But how can the USPTO eliminate regulations in other agencies? Can you imagine the likely fight that will occur between the USPTO and those other Commerce Department agencies (NIST, Census, ITA, NOAA, BEA, BIS, NTIA), as the USPTO seeks to gore the ox of these other agencies, without offering any of the USPTO’s own regulations for repeal?

In a shocking revelation, Frank Murphy, Acting Chief Financial Officer, explained that the USPTO has been and will continue to make payments to the Department of Commerce under the shared services initiative, which is now known as “enterprise services.” Not only are these payments to Commerce potentially (or perhaps likely) in violation of the America Invents Act (AIA), but they are being made at a time when the USPTO is suffering revenue shortfalls and is preparing to increase user fees. According to Murphy, the final fees rule will be submitted to the Administration soon, with fee increases likely by September.

But why is the USPTO in such a fee crisis? Because they have strayed from their mission, which is to issue patents. Far too many Art Units have allowance rates under 5%, and some as low as 1% (and those are in Art Units dominated by Fortune 500 companies). For an agency that derives the majority of its fees from patent owners paying maintenance fees it is downright idiotic for the Office to allow examiners to bury applicants and refuse patents at every turn. Worse, the solution isn’t to ease up and allow patents, instead it is to double and triple down on instituting more post grant challenges and raising fees.

According to the USPTO, the fee increases are designed to better cover the costs of the USPTO’s main patent operations as well as PTAB operations and administrative services. This would be the first major change in fees pursued by the USPTO under their authority to set fees since March 2013; that fee-setting authority is allowed under terms of the America Invents Act (AIA) of 2011… “The fee increase will exacerbate an already existing issue in determining which of these new invention disclosures should be patented,” NASA’s comment reads. “We understand the basis for the upward fee adjustments, but as a Federal Agency subjected to the Congressional Appropriations process, NASA wishes to point out the dichotomy of one Federal Agency’s ability to generate fees at the expense of others.” The direct impact that the fee increases will have on NASA’s patenting activities creates tension with NASA’s federal statutory mandates on technology transfer.

The U.S. Department of Commerce’s United States Patent and Trademark Office (USPTO) today issued a notice of proposed rulemaking (NPRM) proposing to set or adjust certain patent fees, as authorized by the Leahy-Smith America Invents Act (AIA). The proposed fees are projected to recover the aggregate estimated cost of the USPTO’s patent operations, Patent Trial and Appeal Board (PTAB) operations, and administrative services. The Office welcomes comments on both the individual patent fee proposals and the rulemaking goals and objectives. The Office will consider and respond to all comments received, during the public comment period, in the final rule, which the Office expects to publish in 2017.

User fees fund our patent system. The patent system turns ideas into assets. Those assets are used to secure financing and gain access to markets. Financing and market access fuel the rise of new industries, businesses, and jobs. Regrettably, however, those user fees are frequently diverted to fund other, unrelated government agencies and programs, which amounts to a tax on innovation.

Fees for patent attorneys are going to vary quite significantly depending upon the geographical market and the attorney’s level experience. Based on 2011 economic data, the national average for a partner level attorney is $441 per hour, the national median is $410.00 per hour, the 25th percentile is $325.00 per hour and the 75th percentile is $535.00 per hour. Cities like Boston, New York and San Francisco tend to be the most expensive (where the average is $555 to $570 per hour). Texas, Chicago and Washington, D.C. also tend to be more expensive than most other parts of the country, but not as significantly so when compared to Boston, New York and San Francisco.