Recently, light has been shed on the USPTO’s Sensitive Application Warning System (SAWS) policy. I have personal experience with this policy.
Shedding further light on this program is critical to the credibility of the patent process. This article is primarily focused on the experience that my company, Gofigure, L.L.C., and its patent counsel have had with SAWS (rather than concerns and opinions that we have about this policy based on that experience).
My experience with SAWS is not a one-time circumstance, but is a body of difficult-to-obtain information that developed over a nearly five year period (and, for all we know, is likely still developing). The USPTO believes that the public has no reason to know about this internal program, which is likely why its existence is unknown to most within the patent community.
As a brief introduction, I am a registered patent attorney. I began practicing IP law in the early 1990’s with a law firm before becoming the first in-house IP counsel at a well-known consumer electronics company. I left my practice over nine years ago to become an entrepreneur. I have founded/co-founded a number of companies, including Gofigure, LLC.
As a brief introduction to Gofigure, Gofigure holds about twenty-five issued and pending patents on which I am either the sole inventor or a co-inventor. Many of Gofigure’s patents relate to media-playing smartphones and mobile payments, some of which have a priority date in 1999. On a number of occasions, Gofigure has made amicable attempts to sell or license its intellectual property, but Gofigure has never brought or threatened patent litigation.
On different occasions (years ago), Gofigure considered whether it should develop a wireless digital music player or music-playing phone, launch an online music offering, or develop a middleware solution. In hindsight, there is no doubt that Gofigure made the right decision not to compete in the markets for digital music-players, mobile phones, or online digital music.
Gofigure has received funding and has aspirations for a mobile payments account financial product. However, Gofigure does not (and may never) have a product on the market and, therefore, would currently be considered a Non-Practicing Entity (NPE).
Sensitive Application Warning System (SAWS)
I first became aware of the USPTO’s Sensitive Application Warning System (SAWS) policy in January 2008 when a patent examiner told me during a phone call that he had just been instructed not to allow patent applications that he was examining and that were related to Gofigure’s U.S. Patent No. 7,065,342, entitled System and Mobile Cellular Telephone Device for Playing Recorded Music. The ‘342 patent, which has a priority date in 1999, relates generally to a smartphone for downloading and streaming music and storing the title of a purchased music recording in an account of the user. The examiner said that Gofigure’s patent applications related to the ‘342 patent were in the Sensitive Application Warning System, or SAWS. Neither I (nor Gofigure’s patent counsel) had heard of SAWS.
It was clear from the patent examiner’s comments that this matter of the Sensitive Application Warning System (SAWS) had not been initiated by the patent examiner or his Supervisory Patent Examiner (SPE), but rather was an issue of USPTO policy that had been set and mandated to be applied to Gofigure’s patent applications by USPTO personnel in higher USPTO positions. The examiner stated that this mandate came from “way up high” in the Patent Office. Additionally, the patent examiner said that he did not know of anything that could be done to learn more about SAWS or to overcome a designation in SAWS.
I found a memorandum online stating that the USPTO flags applications, under SAWS, for non-allowance and that these applications cannot be allowed until the flag is removed. The memorandum indicates that, under SAWS, the USPTO may consider during patent examination the companies and technology involved as well as potential publicity.
Consistent with that memo, the patent examiner forwarded to me an internal USPTO email with the phrase – “and the public says” – and a link to a blog criticizing the Patent Office for allowing a patent that had been immediately asserted against major companies in the tech industry.
Gofigure filed a FOIA request in an effort to learn more about SAWS and how and why Gofigure’s patent applications were designated into the program, but obtained very little information (and nothing substantive) from the USPTO about the SAWS program. The USPTO denied Gofigure’s requests on the grounds that providing this information would pose a serious risk that the USPTO’s screening procedures under this policy would be circumvented, that the public’s interest in the information is therefore irrelevant, and that the USPTO is not required to disclose internal deliberations by USPTO employees. Gofigure appealed at the agency level (the Appeal was denied by the USPTO).
I wrote USPTO leadership about SAWS. In response, the Office of the Commissioner for Patents wrote to assure me that SAWS is not meant to stop the allowance of any applications or target specific companies, but is merely a way for examiners to identify applications that would potentially have a strong impact on the patent community and ensures examiners receive help in applying the examination standards on these particular applications. When Gofigure’s patent counsel conveyed to the patent examiner that the Commissioner’s Office had indicated that they were helping him, he replied that no one was helping him with the applications.
Subsequently, the patent examiner told our patent counsel that he would allow one of Gofigure’s patent applications if certain claim amendments were made. We agreed to make the amendments. However, a week later, the patent examiner called Gofigure’s patent counsel to explain that he was “sorry” to inform that the application was in SAWS and therefore “cannot be allowed – that is the rule.” The examiner stated that he had to reject the application.
To avoid any uncertainty, Gofigure’s patent counsel confirmed with the patent examiner that the application had indeed been approved by the examiner and his Primary Examiner and processed for allowance. The patent examiner stated that, when he had tried to allow the patent application, the USPTO system returned a thread – “SAWS case – cannot be allowed.” The application was indeed rejected.
I communicated these additional developments to USPTO leadership. In response, the USPTO Director’s Office reassured me that the SAWS program merely serves as a check on the quality of examination, that inclusion in the program does not result in automatic rejections, and that each application, whether or not in the SAWS program, receives an examination on the merits and the decision to reject or allow is based upon the patent laws and prior art.
Eventually, Gofigure’s patent counsel was able to obtain some information through the USPTO’s Ombudsman program. The USPTO explained that our counsel’s law firm (a respected IP law firm) had never heard of the Sensitive Application Warning System (SAWS) because the firm, and indeed the public at large, is not supposed to know of this policy. The Office explained that the Sensitive Application Warning System is an internal USPTO policy, that the policy has nothing to do with the public, and that Gofigure was not supposed to have been informed about its designation in this internal USPTO program.
Additionally, through the USPTO’s Ombudsman program, Gofigure’s patent counsel was told by a USPTO employee with direct knowledge of Gofigure’s patent applications that –
- GoFigure’s pending patent application was in the SAWS program because it “reads on iTunes” and that granting our patent could result in “a very, very public case”, so the USPTO had to be careful.
- the GoFigure patent application, that was rejected shortly after the patent examiner had indicated that it would be allowed, was rejected because a Primary Examiner had been appointed who expressed concern that “this is like iTunes.” To be clear, the patent application being examined had a priority filing date in 1999, several years prior to the introduction of Apple’s iTunes Store, formerly known as iTunes Music Store.
- it should not be implied from the USPTO’s actions and statements that the USPTO would never allow GoFigure’s patent applications. The USPTO stated that the claims could be allowed if they get to a point that the USPTO “is not uncomfortable with them”.
On March 1, 2012, Gofigure placed this information regarding SAWS in the public record of one of its patent applications. Gofigure received a Notice of Allowance in that application later that year (the application matured into U.S. Patent No. 8,385,912, entitled Digital Media Distribution System). Since that time, Gofigure has secured another patent in this patent family.
The USPTO has not placed any information concerning the Sensitive Application Warning System (SAWS), or even an indication of a SAWS designation, in the record of Gofigure’s patent applications. Gofigure is prosecuting a continuation application in this patent family and has reason to believe that SAWS is still likely an issue (but there is no defined way to know).
Early this year, I discovered an article written by Professor Shobita Parthasarathy, a University of Michigan professor, which corroborates Gofigure’s experience. The article is entitled Whose knowledge? What values? The Comparative politics of patenting life forms in the United States and Europe, Policy Sciences: Integrating Knowledge and Practice to Advance to Human Dignity, Vol. 37, No. 2 June 2004, The Journal of the Society for the Policy Sciences (copyrighted by Springer Science+Business Media 2011) (Policy Sci DOI 10.1007/s11077-011-9133-7; ISSN 0032-2687). The article references the SAWS policy (see page 13-14) and reads in part –
On occasion, however, the PTO’s personnel worry that the potential for public backlash is too great to issue the patent. An official noted that in such cases, “. . .the PTO will try to find some way to continue to reject the application. The PTO has lots and lots of tools . . . . So, essentially it is a question of finding a way to continue to reject it.” (PTO Employee a 2009). It is unclear, however, how often the PTO uses the SAWS to reject patents. In sum, the SAWS provides the PTO with a mechanism to identify potentially problematic applications and conduct additional internal review, as a means of preparing for, or perhaps even avoiding, negative publicity.
Earlier this year, I wrote to the Honorable Patrick Leahy and the Honorable Charles Grassley, Chairman and Ranking Member, respectively, of the Senate Committee on the Judiciary and copied members of that Committee. I provided a detailed account of Gofigure’s experience with SAWS and, in particular, explained why fee-shifting legislation cannot exist in light of such a policy (and raised questions).
There are many unanswered questions. I had hoped that our Senators would have taken the opportunity to ask USPTO Deputy Director Michelle Lee questions about the USPTO’s SAWS policy during her confirmation hearing as suggested by Gene Quinn. In addition to the questions presented by Quinn, here are a just a few additional questions that I believe should be asked:
- The Patent Trial and Appeal Board (PTAB) is notified when a patent application on appeal or a patent under post-grant review is in the SAWS program (I have confirmation of this from the USPTO). Why?
- Are their scenarios (and, if so, what are they), under SAWS, in which the USPTO identifies prior art that is material to a patent or patent application under review but does not cite (or delays citing) that prior art?
- How many patents and patent applications are currently designated in SAWS? Averages? Trends? etc.
- How is a patent or patent application removed from SAWS? What facts are considered?
Hopefully these and many other questions will be answered and proper transparency will be brought to what is supposed to be a completely transparent interaction between applicant and the USPTO.