PTO Proposes Rules for OED Patent Practitioner Discipline

On Thursday, January 5, 2012, the United States Patent and Trademark Office published three Notices of Proposed Rulemaking regarding implementation of various provisions of the Leahy-Smith America Invents Act (AIA). A fourth Notice of Proposed Rulemaking was published in the Federal Register on Friday, January 6, 2012.  The Notices of propose rules concern inventor oaths and declarations (77FR982), as well as for third party submissions of prior art (77FR448) in a patent application and for third party citations of prior art (77FR442) in a patent file. The Patent Office also published proposed rules related to the statute of limitations under which registered practitioners may be disciplined for misconduct before the Office (77FR457).

When I first set out to write this article my intention was to do something that briefly summarized the proposed rules to bring everyone up to speed.  Unfortunately, that is not going to be possible.  These proposed rules are the first wave of rules in 2012 that are aimed at the implementation of the AIA.  As we all well knew, the changes to patent law and practice were going to be enormous.  Even these seemingly peripheral rules have layers of nuances, making cursory summary nearly impossible.  For that reason I am going to go one at a time through the proposed rules, today tackling the proposed rules relating to the time limit for the Office of Enrollment and Discipline to bring an action against a patent practitioner for alleged misconduct.

Before proceeding with discussion of the statute of limitations issue, it is worth noting that these proposed rules are just the beginning.  The USPTO expects to publish additional proposed rules implementing other AIA provisions later this month. These subsequent publications will likewise be posted in the Federal Register and will also have a sixty-day comment period. The Patent Office has said that proposed rules due out later in January will relate to rules for supplemental examination, inter partes review, post-grant review, the transitional program for covered business methods, and derivation.  I will be taking each of the proposed rules one-by-one.  It is going to be a busy 2012 to keep up with the proposed changes and final rules that need to come on line sometime during 2012.

OED Statute of Limitations

The Leahy-Smith America Invents Act (AIA) requires that disciplinary proceedings be commenced not later than the earlier of the date that is 10 years after the date on which the misconduct forming the basis of the proceeding occurred, or one year from the date on which the misconduct forming the basis of the proceeding was made known to an officer or employee of the USPTO.  See Section 3 of the AIA, amending 35 U.S.C. 146(k).

Generally speaking, there are four steps taken by the Office of Enrollment and Discipline (OED) prior to the filing of a disciplinary complaint against a practitioner: (1) Preliminary screening of the allegations made against the practitioner; (2) requesting of information from the practitioner about his or her alleged conduct; (3) conducting a thorough investigation after providing the practitioner an opportunity to respond to the allegations; and (4) submitting the investigated case to the Committee on Discipline for a determination of whether there is probable cause to bring charges against the practitioner.

Under the proposed regulation, the one-year statute of limitations begins to run for when the OED Director receives the practitioner’s complete, written response to a request. The Federal Register Notice explains that the Patent Office considered, but rejected, a regulation that would have the one-year limitation commence on the date on which the OED Director initially receives allegations about a practitioner, which if  you ask me is far more in keeping with the language of the America Invents Act.

Notwithstanding, the USPTO did not choose to commence the one-year limitations period upon learning of actionable misconduct for three reasons.

First PTO Rationale

The USPTO says it usually receives information about a practitioner from a client who alleges that the practitioner acted improperly. While mere allegations of ethical violations may alert the Office that a client is subjectively dissatisfied with a practitioner, they often do not provide sufficient objective evidence that misconduct has occurred.

The Notice points out that it is the belief of the USPTO that it would be unfair to the practitioner that the basis of a disciplinary proceeding be predicated only on the allegations levied against him or her without providing the practitioner an opportunity to respond to the allegations. That is, of course, true.  It is, however, wholly irrelevant from a statute of limitations standpoint.

First, there will be some point in time prior to the receipt of the practitioner’s response that the USPTO has convinced themselves that there is enough of an allegation to warrant inquiry.  So it seems inappropriate to point to the fact that initial information may be cryptic.  That is likely true, but does cryptic information reach the level of the USPTO knowing of misconduct?  No it wouldn’t.  The USPTO themselves says that they preliminarily screen the complaints and then seek information from the practitioner.  Obviously the USPTO has been able to articulate the concern enough to request information from the practitioner, so the knowledge standard has been satisfied at least no later than the time information is requested of the practitioner, likely sooner by at least some period of time.

Second, statute of limitations are found throughout the law, and they relate to the time limit within which an action must be brought if one is going to be brought.  The institution of an action does not require iron clad proof, and throughout the law the statute of limitations begins to run against ordinary citizens bringing legal action when they knew or should have known that they had a claim that could be made.  I see no reason why the same analysis shouldn’t apply to the Patent Office.