Editorial Note: Each year we publish our annual IP Wishes column. I invite a panel of industry insiders to tell us what they wish for in the new year. We solicit wishes that are several paragraphs, but also let everyone know we are more than happy to publish full length contributions as well. Marla Grossman took us up on that offer and drafted the following full length article, which is a part of our Industry Insiders series.
Last year at this time, I wished for the passage of trade secrets legislation, resolution of the patent reform legislation stalemate in Congress, that the USPTO consider evidence of non-preemption during its initial determination of patent eligibility; and that the USPTO prioritize accuracy, completeness and accessibility of the public record as part of its Patent Quality Review. Trade secret legislation did pass, but my other wishes were a bit of a mixed bag. The USPTO does continue to work on the patent quality initiative and is focusing on completeness of the record, the Federal Circuit has in at least one case raised the lack of pre-emption as validating a finding that claims are patent eligible. As for patent reform, it stalled, and the future is uncertain as the Supreme Court now considers patent venue.
If a genie were to appear to grant me wishes for 2017, I would ask for two things in particular: First, that the USPTO not change the information printed on the front page of issued patents. Second, that the Commerce Department cease attempts to make the USPTO pay for the shared services initiative.
1. The USPTO Does Not Reduce the Information Provided on the Front Page of Patent
The USPTO is proposing that, as part of an effort to streamline patent issuance, the amount of information provided on the front page might be reduced. The stated rationale for doing so, beyond potential “efficiencies” in the issuance process, is that “complete information concerning US patents and US patent application publications is accessible to the public via the PAIR system.” While in principle this appears to be a reasonable position, in practice it would be highly problematic for several reasons.
First, and most importantly, the USPTO’s proposal will likely lead to a significant degradation in the quality of the public record. Today’s publication processes include robust quality checks on allowed patent applications, including the bibliographic information published on the front page. This process exposes literally hundreds of thousands of errors each year in the information that is available in PAIR.
Each year applicants make literally millions of errors in the documents they submit to the USPTO. While patent examiners often do yeoman’s work in exposing problems in applicants’ submissions, still nearly half of all allowed applications contain errors or omissions that must be identified and corrected prior to issuance – with many of these errors and omissions occurring in the front page content.
The USPTO’s proposal implies (1) that in a streamlined process these quality checks would no longer be performed on front page content during the publication process, (2) that the uncorrected and flawed PAIR content would now represent the public record, and (3) that users of the USPTO’s PAIR content would have to discover and correct for flaws in the PAIR content on their own. This would represent a massive abdication of a key responsibility of the agency, namely assurance of the accuracy of the public record. Further, it would run entirely counter to the Office’s stated commitment to improving quality processes and outcomes, including the quality of the public record.
Former Director Kappos made the following commitment to Congress in 2012. When asked “what are PTO’s plans for ensuring that this new system will help maintain PTO’s current high standard of content accuracy for PTO’s databases and published U.S. patent content,” the former Director answered, in part, “Any PE2E projects that would impact the current patent publication process would meet or exceed the current standards.”
Current Director Lee has said, “I am excited to say that we are taking a big step forward by modifying (1) our process for reviewing patent quality, and (2) the volume of data we’ll be gathering. In essence we are transforming our (1) patent review process and (2) data capture process, with the net benefit being greater transparency and consistency across the entire patent corps.” Moreover, improving patent quality has been a consistent theme throughout her tenure. As recently as this fall, she stated, ““Improving patent quality both in terms of ensuring that every patent issued comports with all statutory requirements and has a clear record, is a top priority for the USPTO. Through issuing high-quality patents, we enable certainty and clarity of rights which fuels investment in innovation and reduces needless litigation.” The USPTO’s proposal regarding front page content runs entirely counter to these commitments from the past and current Director.
In addition to essentially ensuring degradation in the accuracy of the public record, a change such as the one proposed would serve to make patent information more opaque rather than more transparent. The current publication process for front page content involves not only robust quality checks, but also a range of content normalization steps that make search systems far more effective and make the results they provide more useful and transparent. The USPTO’s description of the proposed streamlining implies that these content normalization steps will no longer occur, and that users (and search systems) will have to deal with bibliographic content in more “raw” form (i.e., in the less normalized state in which it exists in PAIR) – simply because current data normalization steps will no longer occur. Taken together, the quality and data normalization issues will represent a massive and growing problem for users of patent information, including patent examiners.
Third, and related to the two issues above, the USPTO’s proposal would increase the cost burden on users of patent information and would create a disparity of outcomes among those users. If the USPTO no longer ensures the quality of the public record at the level of today’s standards or better, users of USPTO content would have to do it on their own. Some users have more and better resources to do so than others, which would create inequity of outcomes. But all users would have to expend more cost, time, and/or effort to arrive at the level of quality and information transparency that the USPTO provides today. In other words, while the USPTO’s costs may go down, users’ costs (and frustration) would go up.
Far from eliminating the quality checks that exist in the current publication process for bibliographic (front page) content, the USPTO should instead be utilizing technology and existing value added content to make those checks more robust.
The USPTO should keep existing post-allowance filters for front page content in place, but in addition to those filters should also implement analytics that are already available in the private sector to catch errors and anomalies that persist to the point of allowance or beyond.
Finally, regarding the proposal, the USPTO says “… the USPTO is seeking to reduce the issuance time of a patent by eliminating potentially unnecessary information from the front page of the patent.” It goes on to say that, since some of the front page information is available in PAIR, it may be duplicative and no longer necessary to appear on the front page. However, a patent’s front page is integral to the end users’ analysis of the document. Thus, while I appreciate the USPTO looking for efficiencies in the issuance process, reducing the amount of information provided on the front page would be highly problematic, and one of my wishes IP wishes for 2017 is that the USPTO not advance this problematic proposal.
2. The Department of Commerce Does not Make the USPTO Pay for Shared Services that the Agency does Not Need
Like a horror movie where the killer, assumed dead, springs back to life when you least expect it, such is the case with diversion of USPTO user fees to unrelated agencies within the US federal government. The latest chapter in this narrative is the USPTO’s forced participation in a Department of Commerce shared services initiative for human resources, information technology, and procurement functions.
The USPTO is, of course, fully funded by private user fees. The ability of the USPTO to keep all of its user fees was a cornerstone of the Leahy-Smith America Invents Act. However, it seems as if the Commerce Departments new shared services initiative distorts the intent of the AIA and is the latest form of fee diversion.
The idea behind the Commerce Department’s shared services is that federal agencies should embrace technology to increase efficiencies and improve productivity. However, the reality is that the USPTO’s needs in each of the identified shared services areas are unique. For example, its IT needs are critical to patent and trademark examination and are quite different from the needs of other Commerce Department agencies. The USPTO is in the process of modernizing its IT systems to handle new demands created by the AIA and has developed information sharing systems to enhance international harmonization. Additional demands of its IT systems at this time could slow the USPTO’s progress and potentially diminish the quality of its work product. Similar concerns apply to the USPTO’s procurement and human resources needs.
Being required to purchase services from other agencies could increase costs for the USPTO, as could the mandated provision of services to other agencies at less than USPTO’s costs to provide them. Even worse would be to require the USPTO to utilize services mismatched to its needs, regardless of their costs.
USPTO stakeholders have yet to be informed by the Commerce Department about how any requirement that the UPSTO use shared services would guard against overpayment by the USPTO for such service, how requirements of other agencies to use USPTO services would guard against underpayment by the other agencies for such services , the magnitude of the expected initial financial expenditure to develop these shared services – and perhaps most importantly – how this Commerce Department initiative is in the USPTO’s best interest.
Thus, my closing wish IP wish for 2017 is that the Commerce Department under the Trump Administration keeps in mind the intent of Congress articulated in 35 U.S.C. § 1 that the Director of the USPTO shall retain authority over the “management and administration of its operations and shall exercise independent control of its budget allocations and expenditures, personnel decisions and processes, procurements, and other administrative and management functions,” subject only to the Secretary of Commerce’s direction on IP policy. Because this matter seems clearly within the authority of the USPTO Director to independently control operations, my wish is that the next USPTO Director is free to determine whether the agency should participate in sharing services with other Commerce agencies only if he or she believes that they will improve the quality or increase the efficiency of the USPTO’s current service offerings.