Submit Your Comments: USPTO Proposes to Raise Inter Partes Review and Other Fees

By IPWatchdog
August 4, 2019

The USPTO fees to bring an IPR petition would be $38,250 for up to 20 claims (if instituted) under the proposed rule.

On Wednesday, July 31, Acting Chief Financial Officer of the USPTO Sean Mildrew posted an announcement on the USPTO blog explaining the Office’s reasoning for its proposal to raise patent fees in a number of areas. The increase will enhance quality and timeliness of examination, America Invents Act (AIA) trials, and replenish the patent operations reserve to stabilize the Office’s finance, Mildrew said.

According to the Notice of Proposed Rulemaking, at least part of the need for the proposed increase is due to the fact that patent application filings are down. “Actual Utility, Plant, and Reissue (UPR) application filings in FYs 2017 and 2018 were less robust than expected,” said the Notice. “In the FY 2020 Budget, given the lower than expected previous year filings, and an analysis of domestic and global economic forecasts, the USPTO has lowered future year filing projections from what was expected when the January 2018 Final Rule was published.”

The January 18 Final Rule raised the fee to initiate inter partes review (IPR) proceedings challenging up to 20 claims by $6,500—from $9,000 to $15,500. IPR post-institution fees for petitions challenging up to 15 claims were increased by $1,000 up to $15,000.

The current proposed rulemaking would raise the fee for IPR requests from $15,500 to $19,500, an increase of 26%. Post-institution fees would be raised from $15,000 to $18,750, and the threshold for paying fees would rise from 15 to 20 claims.

The Notice explained that the reason for the claim threshold and fee increase for IPRs has to do with the U.S. Supreme Court’s decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018), which mandated that the PTAB institute a trial as to all claims or none. “Previously, the PTAB has instituted a trial on just some claims. This has increased the amount of time spent per case post-institution,” said the Notice. The PTAB also now spends more time addressing all arguments presented pre-institution in order to accommodate the SAS decision, the Notice added.  “These changes related to the SAS decision will increase the average cost to conduct each proceeding.”

Thus, the fees to bring an IPR petition would be as laid out below under the proposed rule, amounting to a total of $38,250 for up to 20 claims, if instituted, and more beyond that:

(a) On filing a petition for inter partes review of a patent, payment of the following fees are due:

(1) Inter Partes Review request fee: $19,500.00.

(2) Inter Partes Review Post-Institution fee: $18,750.00.

(3) In addition to the Inter Partes Review request fee, for requesting review of each claim in excess of 20: $375.00.

(4) In addition to the Inter Partes Post-Institution request fee, for requesting review of each claim in excess of 20: $750.00.

New and Significant Fees 

Other notable proposed fees include the request for expedited examination of a design application, which would jump from $900 to $2,000; a new “Non-DOCX Filing Surcharge” of $400; a $250 fee for non-registered practitioners to appear before the Patent Trial and Appeal Board; an “annual active patent practitioner fee” of $340 without CLE, $240 with CLE, or $70 voluntarily inactive fee.

The explanation for the latter fee is as follows:

Currently, the costs of OED’s disciplinary and other functions are paid by patent applicants and owners. The Office proposes these fees so that practitioners, who directly benefit from registration, should bear the costs associated with maintaining the integrity of their profession, including the costs of OED’s register maintenance and disciplinary functions.

The Notice also explained that the fee for requesting expedited examination of a design application has not been raised since its inception in 2000.

Overall, the proposal would amount to a 5% across the board adjustment in fees.

A 60-day public comment period opened on July 31 and comments can be sent to fee.setting@uspto.gov. The Office expects to prepare a final rule by summer 2020.

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Copyright: iqoncept 

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Discuss this

There are currently 26 Comments comments. Join the discussion.

  1. Josh Malone August 4, 2019 1:27 pm

    Here is an idea. Direct all the lawyers at the USPTO (PTAB and Solicitors) to defend patents and inventors instead of attacking them. Then we will apply for more patents and pay to maintain them.

  2. Anon August 4, 2019 6:33 pm

    Josh,

    Not to put too fine a point on it, but as you may recall that a certain posted (Greg DeLassus) loves to point out how personal property may still include franchise property (vis a vis Oil States).

    PART of that though (which he refuses to bring along for the ride), is that IF such were the case, AND the government remains the FranchisOR, then the government owes a duty to the FranchisEE to defend the “product” that the FranchisEE holds (and operates).

    To your very point then, IF anyone wants to clamor for “but patents are merely franchise rights,” THEN let’s have that WHOLE situation, eh?

  3. CW5 August 4, 2019 7:07 pm

    Can the PTO make it any more clear that IPRs are proceeding of big corporations, by big corporations, and for big corporations?

    A $38,250 filing fee is totally ridiculous. How many small and mid-sized business will be able to pay that? Not many. And that does not even include the attorneys fees and expert fees for the IPR.

    We ought to just do away with IPRs, or at least limit them to patents owned by big multi-national corporations (I’m looking at you AppleGoogleMicrosoft).

  4. Josh Malone August 4, 2019 11:15 pm

    CW5, I have heard from several practicing entity inventors now who were threatened by patent trolls themselves. They told me they could not afford to file an IPR. I don’t see any small businesses using the IPR system. I see Google, Apple and other big corporations using it to wear down the rights owner and nullify jury verdicts.

  5. CP in DC August 5, 2019 9:23 am

    So no small entity or micro entity discount for IPR. Well, it will become (if not already) the sport of kings…

    The other gem: “an “annual active patent practitioner fee” of $340 without CLE, $240 with CLE….” For what services? Perhaps to stop the unauthorized practice of law? Yeah no. Perhaps to provide CLE that will cost less than $100? Yeah no. So really a money grab (yet another) for no additional services.

    IPLaw 360 had an article on how reg numbers were diminishing over time and the current trend of 2015-2020 will have as many new reg numbers as the 1990-1995 period. Also there are more active practitioners with 21-25 years of experience than those with 1-5 years and more than half of active practitioners have 16 years experience. So the average practitioner is aging and fewer people are getting reg numbers, but surprisingly…. applications are increasing. Well, I’m glad those active practitioners are working so hard to get all those filings in, well unless there is some other explanation…

    I’m waiting to see how the “active patent practitioner fee” will diminish the number of those with reg numbers.

  6. Charles E. Miller August 5, 2019 10:00 am

    In Peter v. NantKwest, Inc. (U.S. Spm. Ct. No. 18-801) and Booking.Com v. USPTO (U.S. Spm. Ct. No. 18-1309) the PTO contends that the phrase “all expenses of the proceeding(s)” in 35 USC 145 and 15 USC 1071(b((3) should include the pro-rated salaries of its in-house legal personnnel. The Agency bases its position on the need to avoid having to pass along its legal costs incurred in defending civil actions under these statutes to other users of the examination system. Does the Agency have (i) any cost accounting analysis to substantiate its alleged need to do so, and (ii) any reason why it can’t do so by exercising its own fee-setting authority under the AIA?

  7. Benny August 5, 2019 11:26 am

    Compare that to the cost of opposing an EU patent. The Eurowimps have got it right for a change.

  8. PTO-Indentured August 5, 2019 12:22 pm

    Here yet again, is another glaring example of the US patent eco-system’s continuing effort to irreversibly guarantee an institutionalized double standard wherein IP determined to be valuable ‘will be the property’ of a few doted-on mega-oligarch co.s (who no longer demonstrate a loyalty to any ‘mere nation’), while perhaps a few ‘trickle-down’ gizmo-IP patents shall be allowed (with questionable enforcement) as at least ‘some bread crumbs’ going to those so-called ‘individual U.S. inventors’.

    Any budget can be viewed (inseparably) relative to the merits of its justice, its timeliless, its capacity to address and remediate gross disparities. THIS IS THE TIME to turn the tide, to show literally the ‘responsibility’ of the stewards in charge of and having any control over FAIRNESS, that will bear on the fate, the destiny, of the U.S. patent system.

    Look: if ‘money’ is really the issue, then the funds being sought here would not even be 1/100th of 1% of the doted-on handful of oligarch co.s’ wealth.

    BALANCE THE SCALE by distinguishing ‘mega-entities’ on the one end, from ‘micro-entities’ and ‘small entities’ on the other — such that all resources being sought are fairly, justly proportional to ability to pay. What’s the big deal here? If it is ‘next to nothing’, relative to the untold caches of money — literally ‘cash on hand’ — ‘above-national’ mega-entities have amassed, then DIFFENTIATE NOW such that untold wealth of a still-unchecked growing disparity — directed away from the weal, the benefitting, of our own nation — is fairly redirected to those entities having proved for so many decades, that it was they who were by far the better and more consistent innovators, the better job-generators who fearlessly, tenaciously and efficiently brought invention after invention to our country to our U.S. patent system.

    Make it easier and easier (even less costly) for the proven-entity innovators, job-generators, inventors, to file more and more patents, that are intentionally and accountably, following a careful examination and legitimately-earned issuance more clearly defensible under (the sensibly re-instated) Phillips-grade level of enforcement.

    Copy the model of the latter, smaller entities now. Show us a stewardship having a fearlessness, tenacity and efficiency, spirit equal to theirs, sufficient now — needed now more than ever — to turn the tide.

  9. name August 5, 2019 2:27 pm

    Megacorps set up offshore tax havens. Will Megacorps move their patents to smaller subsidiaries to reduce the patent fees?

  10. Night Writer August 6, 2019 10:33 am

    From what I’ve seen a large number of the patent filings are from inventions invented outside the USA. I think there are some pretty signs that the patent system is dying.

  11. Night Writer August 6, 2019 11:10 am

    The other thing that is going on here is that the PTO is not being realistic about the value of patents falling 80 percent. In the next recession the filings will fall dramatically. And the personnel at the PTO should all have salary reductions to adjust to the lower value of patents. I’d suggest a 40 % percent decrease in the salary of the PTO personnel across the board and moving the PTO to Detroit entirely for a lower cost of living.

    Many of the prosecution law firms have done this where a lot of the work has moved outside the large cities.

  12. LLDC August 6, 2019 1:57 pm

    Instituting a Patent bar fee is ridiculous. The louse at the PTO are exempt, too.

    An “annual active patent practitioner fee” of $340 without CLE, $240 with CLE, or $70 voluntarily inactive fee.

    There’s NO DATA on this! NO DATA!

  13. IamI August 7, 2019 11:20 pm

    Night Writer, please tell me how you plan to slash patent examiner salaries 40%. Because you know that’s a proposal straight out of fantasy land.

  14. Anon August 8, 2019 9:06 am

    It is far more likely that 40% of the workforce would be furloughed than it would be for 40% pay cuts across that workforce.

    I agree that Night Writer is off in the particulars of what he said, I took a larger view of what he posted to be that a major shake-up is in store for the USPTO examiners in the not-too-distant future (that is, in the inevitable next recession).

    He is of course wrong on the pay cut (from multiple angles, including Union factors as well as the reality of a 40% pay cut may well likely result in a greater than 90% attrition, as that wage level would be accepted by only the lowest dregs of the examiners).

  15. Anon August 8, 2019 9:41 am

    To Night Writer’s point (to some extent), there is a new post over at PatentDocs showing the year over year top 15 patent grant holders ( https://www.patentdocs.org/2019/08/ipo-releases-list-of-top-300-patent-holders-for-2018.html#comments ).

    It is worth noting that one is brand new (although doubtful that their 2127 number this year is a delta from zero), the overall year over year is negatively sloped, and fully eight of the top fifteen have drops in patent grants, while only 3 of 15 have any appreciable grant growth.

    And that is an “end-of-process” statistic, which of course has a substantial latency effect (perhaps a better measure would be new filings).

    The AIA (coupled with the activist Court(s)) has been everything that the Efficient Infringers could have dreamed of: patent rights are more difficult to obtain and enforce, are more uncertain, and are more expensive. The only item not degraded is perhaps timing (I believe that the timing aspect is largely flat).

    Turning the reward for innovation into the combination Game of Kings AND matter of efficient infringement WILL have its consequences — and these consequences WILL affect the patent office itself.

    Case in point here, is that the FEE INCREASES are being ‘blamed’ in part ON a drop in filings and a projected smaller body of items to which the overall costs (fixed and variable) NEED to be spread among. Such a mechanism for INCREASING COSTS over a smaller body of items is quite frankly NOT sustainable.

  16. IamI August 8, 2019 11:10 am

    I agree, anon. A 40% pay cut (which means you would have to demote all examiners to GS-11 and below) and a forced move of the PTO to Detroit would gut the agency, just like what is happening with the USDA and that recent forced move to Kansas City.

    There may be changes coming to the PTO, sure. But gutting the agency and forcing a brain drain is not the answer to any challenges that may arise.

  17. Night Writer August 9, 2019 11:42 am

    Yes you all are right that a pay cut of 40% is not realistic. But, the PTO should be looking to cut costs and start preparing for a massive jolt in the next recession. I think too that moving the PTO to a place with a lower cost of living is a necessity unless Congress is going to restore patents.

    What I am seeing is a continuing lessening in the emphasis on patents by technology companies. Patents have almost reached junk status. Since the AIA, I haven’t heard one tech company talk about increasing spending on research to get more patents.

    The PTO’s focus should be on reducing fees and preparing for massive layoffs.

    We are almost at a tipping point. I see things like tech managers telling the senior people not to waste their time on patents. That the patent work should be pushed off on the junior tech people. I see patent budgets continuing to decline for the corporations. Etc.

  18. Night Writer August 9, 2019 11:49 am

    One thing I forget. What I see now, which was not the case prior to AIA, is patent budgets are instantly cut to make Wall Street numbers. What that tells us is that we can expect the budgets to be cut to the bone during a recession.

  19. Anon August 9, 2019 2:47 pm

    Night Writer,

    Please note that I do NOT disagree with your larger points (and in fact, point to a PatentDocs story that supports those larger views).

    But there is a huge difference in what the private sector may do (and how quickly), and what a government administrative agency may do.

    Keep in mind that application filings REMAIN near record levels.

    And let me quickly add that whether or not these levels reflect innovation within the US is NOT a point when it comes to the administrative agency funding mechanism.

    From the USPTO (not sure why there is time lag, with 2015 being provided as “the latest”…

    https://www.uspto.gov/web/offices/ac/ido/oeip/taf/reports.htm

    Or this blog’s own story (through 2017 – with merely a slight dip in 2017):

    https://www.ipwatchdog.com/2018/04/11/fewer-patent-applications-filed/id=94436/

    Note though, that at least the 2015 limited US data DOES provide a “U.S. Origin” designation.

    That being said, I would question the methodology of that origin calculation, and would REMOVE — and place in its own category — filings that come from corporations that are not PURELY US corporations (given the lack of allegiance from the juristic person that a corporation is).

  20. Night Writer August 10, 2019 12:20 pm

    Anon: As I have said, if the applications were being measured properly, then it would be clear what is happening is there is a reduction in filings from inventions made in the USA and the slack is being made from foreign filings mainly from China.

  21. IamI August 11, 2019 9:54 am

    Moving the PTO wholesale to a place with a lower cost of living is a Trump/Mulvaney “swamp draining” move that would gut the USPTO of the very employees who should still be working there, Night Writer. Why even suggest it? Do you want chaos? Do you want patents that are worth even less because they’re examined by poor examiners?

  22. Anon August 11, 2019 10:20 am

    Night Writer,

    I find myself in the somewhat odd position of both agreeing with you and disagreeing with you.

    This has to do with how the US government itself has classified its data.

    On the one hand, your overall proposition of “reduction in filings from inventions made in the USA” is directly shown to be false.

    The 2015 limited data for filings from inventions made in the USA – normalized at a base year level of year = 1983 (solely chosen for being the category minimum***), shows the following trend:

    2015: 4.85
    2014: 4.80
    2013: 4.84
    2012: 4.52
    2011: 4.17
    2010: 4.07
    2009: 3.78
    2008: 3.89
    2007: 4.06
    2006: 3.73
    2005: 3.50
    2004: 3.19
    2003: 3.18
    2002: 3.10
    2001: 2.98
    2000: 2.77
    1999: 2.52
    1998: 2.28
    1997: 2.02
    1996: 1.79
    1995: 2.08
    1994: 1.80
    1993: 1.68
    1992: 1.55
    1991: 1.48
    1990: 1.52
    1989: 1.38
    1988: 1.26
    1987: 1.15
    1986: 1.10
    1985: 1.07
    1984: 1.04
    1983: 1
    1982: 1.06
    1981: 1.05
    1980: 1.04
    1979: 1.01
    1978: 1.03
    1977: 1.05
    1976: 1.09
    1975: 1.08
    1974: 1.07
    1973: 1.12
    1972: 1.11
    1971: 1.19
    1970: 1.21
    1969: 1.14
    1968: 1.13
    1967: 1.03
    1966: 1.12
    1965: 1.21
    1964: 1.12
    1963: 1.12

    It is self-evident that we — at 1915 levels — remain at an unprecedented PEAK of patent activity. Dropping a FULL multiple would only move the bar back 6 years.

    That’s where I disagree with you.

    However, I have an innate desire TO agree with you because in part I think that the US defined data is itself defined poorly. I believe the data is defined to include within its “US-designated” count the data of multi-nationals, if those multinationals have A home base in the United States.

    Since multinationals – even those with such a home base – are NOT beholding to any one Sovereign (and may even assign patent portfolios to foreign subsidiaries; for tax purposes, for example), this counting portrays a false picture. As I have postulated, transnationals (multi-nationals) should not be included in a pure “US innovation here” metric.

    No one knows what that true picture is like.

    *** I have played with some charts in Excel for the US data, and the chart with the non-US filings (normed at the same year = 1983) shows some very interesting distinctions and similarities in data trends, with the designated US filings much more susceptible to economic downturns. While the foreign filings have a few plateaus over the last five plus decades of data, there is but one single moderate downturn in filings. Also, while it had only been in the last decade that foreign filing share has eclipsed 50%, the relative gap had narrowed appreciably all the way back to the 1980’s with only two short spans of US advance. This tends to show that your supposition of foreign filing excesses is itself a bit of an excessive position.

  23. Night Writer August 11, 2019 11:42 am

    @21 IamI

    Actually, if you look at the PTO, it is much like an engineering center for a large corporation in function and the qualifications of the people that work there. I don’t think the PTO would have any trouble attracting people to places like Pittsburgh. In fact, it would probably help as then the average examiner could afford a home a decent middle class life style.

    This has nothing to do with “swamp draining.”

  24. Anon August 11, 2019 1:37 pm

    I will also agree with Night Writer @ 23 – relocating the Office AWAY from the high cost of living center of Washington DC has nothing to do with Trump, or any political-related mantra like “draining the swamp.”

    This idea is NOT new – and has been bandied about WELL before Trump was in Office, and has occurred regardless of the political machinations in DC.

    Further, this would have the opposite effect that IamI alludes to: this would make employment at the Patent Office MORE attractive, rather than less.

    It would also have another (unspoken) benefit of removing the patent office from a “center-of-government” bureaucratic-tending “Group-think” environment (one that exists no matter which political party is in charge at the moment in DC).

  25. Night Writer August 11, 2019 2:19 pm

    @22 Anon

    Is that data distinguishing between applications made in the USA vs. applications that are first filings, but not made in the USA? (Plus your point that many of the applications are split among multiple companies.)

    What I am seeing is fewer US applications from inventors living in the US and many more applications that are original applications from non-resident foreigners, but with USA companies.

    I am not sure the data is making these distinctions. My contention is that applications from inventors living in the USA is down.

  26. Anon August 11, 2019 6:16 pm

    The data merely lists applications (not distinguishing Cons or Divs) that are filed by a “US entity” versus those filed by a “non-US entity.”

    How they made that determination is not divulged.

    On top of the lack of distinguishing that you and I have noted, there is also uncertainty as to how any multi-inventor/split-nationality applications have been treated.

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