Suggestions for Fixing the US Patent System

In order to jump start a constructive debate I throw out the following nine suggestions that would, in my view, assist in solving the patent crisis that we are in; a crisis that could easily lead to the irrelevance of the US patent system as a whole.

1. Revise the Examiner Quota System

This is not the first time I have suggested this, and others have as well, but as we all know, and the Patent Office should know, a number of Examiners abuse the entire process in order to make their numbers. Examiners will require the filing of an RCE all for the purpose of disposing one case and then getting an easy clearance.  I do not blame the Examiners for finding out ways to manipulate the system, the blame lies squarely on PTO. This is a problem that predates this administration, and likely predates the previous administration as well.  Nevertheless, this problem must be solved. I personally would do away with a quota system and implement a quality based bonus and retention plan.  I believe the Patent Office has started encouraging issuances and late interviews, but until the quota system is revised there will be abuse and that just raises cost for applicants and delays the issuance of a patent.

2. Give Examiners Adequate Time

While we are revising the quota system we need to keep in mind that if we want high quality patents examiners should be given adequate time to examine a case. In any technical field an estimate per application can and should be made. In the event that the Examiner feels that additional time is required for one reason or another the Examiner should then request such permission from his or her supervisor.

3. Move to a Fee for Service Model

It was astonishing for me to learn that the Patent Office does not believe we have a fee for service model. They charge more for large applications, more claims, multiple dependent claims, extensions of time and more. You name it and the Patent Office charges for it. The a la carte system of fees is even a bit ridiculous, particularly when they change them insignificantly up or down every 6 months. The Patent Office view is that because 70% of their funding comes from maintenance fees they do not need to do more work on larger applications, even though they charge more. But now with the prolonged decrease in allowances maintenance fees will not provide the revenue needed.

Every application gets the same consideration, which is very egalitarian. Unfortunately, for better or worse nothing in the U.S. legal system is egalitarian, and the patent system is not egalitarian either. The more money you have the better representation you get, the better patent you get and there is just nothing that can or should be done to change that. Therefore, if the Patent Office needs to provide more time to examiners and hire more examiners the way to do this is to charge a fair price for the amount of work that is required by an application.  And rather than starting a Deferred Examination program why not try the reverse, start an Immediate Examination program for the payment of a fee.

4. Move to Regional Patent Offices

I have written about this before, but it recently came up in a discussion I had with someone at the NAPP Annual Meeting.  As only the federal government could do, they built a brand new Patent Office building that wasn’t large enough even as of the day it opened. As sad as that is, the inadequate planning presents opportunities. The main corporate headquarters for the Patent Office stays in Alexandria, Virginia. Then rather than the stay at home work program, which reportedly has Examiners sometimes conducting interviews with barking dogs and whining children in the background, we move to regional Patent Offices. This has enormous benefit for multiple reasons, but first and foremost is the ability to hire more people will better skills. Let’s face it, there are only so many adequately trained and educated people who are willing to live within commuting distance of Alexandria, Virginia. The price of living and the traffic alone make choosing a career as an Examiner exceedingly difficult these days even though Examiners are paid very well by government standards.

Additionally, by locating Patent Office strategically around the country Uncle Sam could actually participate in the revitalization of certain communities.  With the unemployment rates in California and Michigan, a regional Patent Office in both places, and maybe in others, would not only be wise, but it would also be good politics.  When was the last time the wise thing also made political sense?  Oh, right, never.  Sorry.

5. Privatize the Patent Office

I am not sure I like the idea of a completely privatized Patent Office, but it has always struck me that this is an Office that just screams quasi-governmental corporation. I know all the problems with the Post Office, but on some level isn’t it rather remarkable that they can actually get that level of mail straight as accurately as they do these days? Additionally, the Smithsonian seems to run well. In fact, I would say that the only parts of government that year after year really run well are those that are not run by the government.

6. Alter or Eliminate Rule 56

I have been beating this drum for years.  We should do away with Rule 56 altogether… in the name of patent harmony!  OK, those who know me know that I think patent harmony is a bunch of bunk.  Whether folks like it or not, the US is the dominant market so us harmonizing to meet the demands of others is just silly.  Nevertheless, I am always willing to harmonize when we adopt things from other countries that make sense and are improvements on how we handle things, sadly that doesn’t seem to be often, but I digress.

Other Patent Offices around the world do not have the same or similar requirement to disclose prior art, yet they manage to function. Eliminating Rule 56 altogether would certainly be better than what we have now. If Rule 56 is not eliminated then it should be altered to more directly approximate a fraud test, and Congress MUST enact Rule 56 so that we can actually bring harmony to the PTO view and the Federal Circuit view, which is horribly contradictory.  When Congress does enact rule 56 (see the optimism) inequitable conduct should be found only when there is evidence sufficient to demonstrate an attempted fraud on the Patent Office, and fraud in the classical sense, which means it must be plead with specificity.

I would also do away with materiality completely. After all, aren’t the Examiners supposed to do their own independent review of materiality anyway?  But wait, what if some bad acting patent practitioner provides thousands of references?  See point 3 above.  Fee for service answers so many problems.  I can’t be the only one that sees that, am I?

7. Make the File Wrapper Inadmissible

One of the problems that presents itself during prosecution is the reality that everything we do say can and will be used against our clients in the event that something valuable has actually been invented. I would like to see legislation enacted that will either completely eliminate, or at the very least limit, the ability to use anything in the file wrapper during litigation. In the event that there is not a complete elimination then use of the file wrapper, which could still be discoverable, would be limited to those situations were there is a fraud on the Patent Office, with fraud not being defined by materiality, but rather by making intentional misleading, knowingly submitting false information, making arguments that are known to be scientifically or legally incorrect, or otherwise lying to the Examiner. In other words, “real fraud” not just inequitable conduct.

In my opinion, patents should be able to stand on their own, without need to look to the file wrapper. The net effect would be better, more complete applications that describe all facets of the invention. It would also allow for a more frank exchange of information between the applicant and Examiner. I also suspect that if this change were enacted many of us would have significantly fewer problems with requiring more by way of Information Disclosure Statements. But in exchange for more information this information needs to be inadmissible unless there is outright fraud.

8. Really go after Invention Scams

Every now and again the USPTO and/or the FTC will go after one of the hundreds of invention scams out there preying on independent inventors. Everyone knows, however, that there is no real concerted effort to stop these folks, and that remains true even after the PTO revised the Unauthorized Practice of Law rules (see Rule 11.5) specifically to stop scams. We all know who they are, we know where they operate and the PTO had broad new (and unused) powers. They even advertise on TV, yet all we can get is government action once in a while and no action under Rule 11.5? Why is that? How can that make sense?

9. Write rules & regulations that directly address abuse

There are attorneys who abuse the system, there are applicants that abuse the system, and there are examiners that abuse the system. We all know that there are bad actors in any group of people, and these bad actors give the rest (and like vast majority) of group members a bad name. Rather than implementing rules and regulations that impact everyone, how about we try and write rules that solve the problem directly.