Anticipat’s Top 10 Blog Posts of 2017 – Happy New Year’s!

As the New Year is upon us, like many of you we are looking forward to a great year. At this time, we are reflective of 2017. In this year, the website of Anticipat.com saw major improvements. We expanded the library of decisions, we improved decision annotations through a unique rationale tag and legal support framework, we launched Practitioner Analytics, and we even made a couple Youtube videos.

We also launched this blog early this year. It has unexpectedly been quite the ride reporting on and providing analysis of ex parte PTAB appeals decisions. In this, it has been critical to see the forest while seeing the trees. Many readers are finding ex parte appeals data helpful for guiding prosecution strategy. Here are the top ten blog posts of this year by traffic.

  1. Which law firms are successful in overturning abstract idea rejections on appeal? – For difficult grounds of rejection, the right advocacy can make all the difference. The right counsel can know when to appeal and how to win on appeal. Here, we explore the demographic of firms that represent appellants that overturn one of the most difficult of all rejections: Section 101 abstract idea.
  2. Section 101 Rejection Overturned. What’s Next: A Notice of Allowance or a Revised Office Action? – It has seemed like the PTAB has been on a recent roll in reversing abstract idea rejections. On this note, two related business method applications came out on October 3, 2017: Ex Parte Webber et al., Appeal No. 2015-003647, and Ex Parte Webber et al., Appeal No. 2015-003796. The Board only sought to decide the rejection at hand and not to evaluate the patent-eligibility of the claims on its own. Now that the decision was rendered, the logical question is what happens next? To understand this, we navigate through a somewhat complex area of rules.
  3. Business methods patent-eligible? PTAB: Yes – Business method art units have been a scary place for patent applications. In Alice v. CLS Bank, a vocal minority of the Supreme Court would have categorically excluded business method patents from eligibility. So it comes as no surprise that many Examiners have raised the bar of patent-eligibility of business method inventions to unprecedented levels. So much so that applicants now try and avoid any claim language that hints at business methods. But business method patents are not per se doomed, as shown in the recently decided Ex parte Breiter, dated September 29, 2017.
  4. Too Simplistic: How the USPTO measures outcomes for ex parte PTAB appeals – Currently, the USPTO measures decision outcomes of ex parte appeals in three different ways: affirmed, affirmed-in-part, or reversed. This is highlighted by the USPTO’s recently released statistics on outcomes of ex parte appeals for FY2017. These stats show that the Patent Trial and Appeal Board (PTAB) very frequently upholds Examiners on appeal, with a 55% affirmance rate. These affirmed rates suggest a job “well done” by the USPTO. However, the way the USPTO counts affirmances yields counterintuitive and misleading results, especially with cases involving multiple grounds of rejection. Indeed for accountability purposes, this way of measuring appeals cloaks the USPTO’s Examining Corps failures.
  5. When a Final Office Action comes in, consider using Anticipat. Here’s why – A first Office Action can involve a lot of guesswork. What does the Examiner mean with a particular rejection analysis? Is the Examiner serious with a particular rejection or just bluffing? Can the Examiner really get away with a particular rejection? An important point about Examiners is that they all examine applications quite differently. For one, they have different personalities and understandings, resulting in a varied interpretation of the patent laws and rules. But not all of these personality quirks or internal memos comport with the patent laws or patent rules, which is where the Board comes in. The Board is the first line of defense in holding Examiners and even their SPEs accountable for the rejections they issue.
  6. Wisdom of the Board: Most Effective Arguments for Obviousness – Can Board decisions help in knowing how to overcome obviousness rejection? [L]ooking at the frequency of arguments can provide a framework and see the most effectively used. In appeal briefs, the Board entertains a lot of arguments and they coalesce around a finite set of them in overturning an obviousness rejection. Board decisions can definitely help organize these arguments. Plus, knowing the most frequent arguments can help in knowing how to draft appeal briefs. But more generally, it helps to align response arguments for proper prosecution. Because if you are following the way that judges overturn rejections, that information can be useful.
  7. PTAB Mocks Alice Supreme Court in Reversing 101 Rejection — Claims Include “Talismanic” Inventive Concept when the conventional computer components are arranged to provide specific advantages to the users – In ex parte Lynch, Appeal No. 2016-002985, the Board reversed a Section 101 rejection, holding that the claimed invention provides an improvement in the functioning of the computer. Finally, in an apparent mocking of the Supreme Court, the Board concluded that the claims include the talismanic inventive concept.
  8. Presentation Recap on Abstract Idea Developments at the PTAB – Trent Ostler did a deep dive on abstract idea developments at the PTAB yesterday at the AIPLA Joint Committee Hot Topics Presentation (Patent Law Committee and ECLC). He used data from Anticipat.com for all his results.
  9. How to overcome an abstract idea rejection? Emphasize narrowing claim amendments and lack of prior art rejections – Recently decided ex parte Blaho, Appeal No. 2016-007954, (PTAB September 28, 2017) reversed an Examiner’s abstract idea rejection. In doing so, the Board first dismissed the Examiner’s characterization of the claims. Then, the Board found that the long prosecution history with significant amendments to overcome prior art rejections was evidence that the claim elements were not routine or conventional. It is a case worth studying for practice tips.
  10. Another “good” bioinformatics claim found patent-eligible by the Board — insufficient evidence of routine and conventional claim – In a previous post, we defined what a good bioinformatics claim looks like. Such a claim does not suffer from divided infringement issues and it does not recite steps to be performed by hospitals or doctors (e.g., medical procedures, administration of therapies) for maximum damages. We also reported that the US Patent Office resists granting such claims, alleging a lack of statutory subject matter. Here, we report on the PTAB continuing a trend of reversing such rejections of these types of claims.

To conclude, thank you for joining with us as we stay current on PTAB developments and trends. We are looking forward to many more interesting posts and for continued improvements to the website. Your feedback is critical to us. Happy New Year’s!

PTAB: Increasingly difficult to overturn abstract idea rejections on appeal

The latest data from Anticipat show that the effects of #AliceStorm are beginning to stabilize at the PTAB. At a webinar over the summer, we presented data on the reversal rates of abstract idea rejections. Month-to-month, we presented on a highly volatile, but overall low reversal rate for abstract ideas of about 17%. Now with several more months of data, the reversal rate appears to have stabilized around a lower overall reversal rate of 16%. See chart below.

monthly

To lower the overall reversal rate down to 16%, the past few months have seen low reversal rates: September at 15%; October at 11%; November at 14%; and December at 11%. This highlights a trend of eight months in which no monthly reversal rate has exceeded 20%.  See also below table.

Month Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17
Reversal Rate 33% 27% 33% 29% 14% 28% 39% 20% 3% 11% 14% 15% 8% 15% 11% 14% 11%
Reversed 2 3 2 7 3 17 15 16 1 7 13 16 7 10 9 8 2
Total 6 11 6 24 22 60 38 81 31 63 94 108 93 68 83 56 19

The overall reversal rate means that for every appellant appealing an abstract idea rejection through to a final decision, less than one in six will be successful. While the data show this is a difficult rejection to overcome on appeal compared to other rejections, it also shows that appealing such rejections is not a completely futile endeavor.

As abstract idea rejections have grown in popularity among the Examining corps post-Alice, a low reversal rate may embolden Examiners to reject on abstract idea grounds. Technology that had previously rarely encountered abstract idea rejections is now seeing such rejections, making no art unit immune. Plus, computer technology infiltrating every technological sector makes abstract idea rejections even more likely to continue.

But each SPE of each art unit and each director of each tech center approaches Section 101 differently. Anticipat Research provides an ability to search for appeals-data for your particular art unit of interest to see the rates and the recent reversals. As will be seen in a forthcoming post on tech center rates, there are calms within the storm.

 

Which law firms are successful in overturning abstract idea rejections on appeal?

For difficult grounds of rejection, the right advocacy can make all the difference. The right counsel can know when to appeal and how to win on appeal. Here, we explore the demographic of firms that represent appellants that overturn one of the most difficult of all rejections: Section 101 abstract idea. Recent data show that while some big/specialized firms are successful, others without the same name recognition also are doing relatively well.

We have previously reported that in the post-Alice era, the PTAB reverses abstract idea rejections about 17% of the time. Updated for the past few months (blog post forthcoming), this overall rate has dipped. But this low percentage still represents a sizeable 135 decisions over the past year and a half (specifically, July 25, 2017 through December 1, 2017). This span of time represents the applications that are most likely to have been issued a post-Alice rejection and subsequently appealed. It turns out that select firms make up a good share of these successes, followed by a long tail of single reversals per firm.

Two firms immediately stand out from the pack: Morgan Lewis and Schwegman, Lundberg & Woessner. These firms each have 5 reversed decisions on appeal, a laudable number in this post-Alice climate.

Next are firms each having three reversals: Cuenot, Forsythe & Kim and Brinks Gilson and Lione (stemming from three related applications issued the same day).

Next come the firms/companies with two reversals apiece (arranged alphabetically):

Finally, there are 90 other firms/corporations/pro se applicants who have achieved one reversal (see end of post for names).

Our methodology involved using Anticipat Research database to find all reversed Section 101 decisions decided on abstract idea grounds. We then identified the law firm/corporation who signed the reply brief or appeal brief and crediting them with the reversal.

Two things are clear from these data: First, some firms are really quite good (relatively speaking) at appealing abstract idea rejections–even in the face of fast-evolving case law and various application filing dates (pre- and post-Alice). Make no mistake, a firm that can overturn an abstract idea rejection several times over the past year and a half is not doing so out of luck.

Additional research is needed into normalizing these data, which could identify whether these successful firms are achieving such high reversals by appealing much more frequently than others. However, Morgan Lewis and Schwegman would need to appeal quite a bit more than others for their high reversals to be explained only from sheer numbers of ex parte appeals.

Another related question relates to firms having smaller patent prosecution practices. Do these firms’ reversal numbers come in the face of handling a much smaller number of cases than bigger patent prosecution firms? This would indicate that smaller firms are in fact equally if not more successful than the Morgan Lewis and Schwegman types.

The second point that is clear is that a broad diversity of counsel succeeds in appealing abstract idea rejections. Counsel ranges from firms in big cities with the highest of billable rates to boutiques in smaller cities who carry much lower overhead. Solo practitioners also win and even pro se appellants succeed on Section 101 appeals. Common wisdom may suggest that you get what you pay for in patent counsel, and that a high stakes appeal of such a difficult rejection requires a Tom Brady billable rate. But the data show a broad range of counsel are successful, indicating that a superstar billable rate is not required to overturn an abstract idea rejection on appeal.

These two points strike at an interesting concluding point. While there are some certainties in navigating the abstract idea waters, there is a great deal of uncertainties. For the certainties, a certain level of legal sophistication and experience may be needed to successfully argue an abstract idea rejection at the PTAB (persuasive writing and rebutting the Examiner’s points with the right, relevant case law).

For the uncertainties, Section 101 case law has been evolving very regularly since Alice, meaning that there is a large amount of unpredictability and volatility. That being said, having the most up-to-date data available on Section 101 ex parte appeals can equip any counsel with the right tools. Anticipat Practitioner Analytics lets you see the reversal rates for certain Examiners, art units, and tech centers for all types of rejections. It also shows you the most often cited case law used by the PTAB for abstract idea grounds of rejection. Watch this YouTube video for more information or check out this page here: https://anticipat.com/accounts/signup/analytics/ Sign up now for a free trial.

 

As discussed above, here are the firms with one reversal, sorted alphabetically:

 

The PTAB Ex Parte Appeals Backlog Is Falling: What that means for you

There are several good reasons for not appealing a patent application, even in the absence of progress with the Examiner. One such reason stems from the lengthy PTAB backlog—the period of time it takes for the Board to decide appeals. By the time it takes for the Board to overturn an Examiner’s rejections, investment and PR opportunities directly tied to a patent issuing can wither. Not to mention, a lot can change within the business during this time, such as the viability of stopping infringing activity. So it is often desirable for an applicant to move fast to issuance. And outside of post-grant trials, the PTAB has not been known for speed.

But as the USPTO has aggressively hired PTAB judges to meet demand for post-grant trials, an interesting side-effect has been that the backlog for deciding appeals has fallen to historic lows. For this reason, filing an appeal can result in a disposition sooner than you might think.

As shown in the most recent statistics by the USPTO, pendency of decided appeals is considerably lower compared to last year. See below figure. As can be seen, each tech center that decides patent application appeals saw a substantial reduction in backlog from the previous year. Some technology centers, including electrical and computer arts, are experiencing almost 50% reductions in the backlogs in a single year’s time.

pendency

The PTAB backlog is calculated from the time that the appeal is forwarded to the Board until a decision is made. Another way of measuring the appeal time is the total amount of time from the notice of appeal. For this, simply add the many more additional months that account for the time it takes to file the appeal brief, wait for an Examiner’s Answer, and file a Reply Brief, if applicable. Assuming that these steps that precede the appeal forward take less than a year, these data show that for even the slowest tech centers (or most busy with the number of appeals), the total appeal time for most applications will be under three years total.

These backlog reductions at the PTAB in only one year’s time are significant. Compared with data from FY2013 (before the AIA was even enacted), current pendency is significantly lower in every tech center. See below graph from FY2013.

2013

The PTAB shows no signs of slowing the reduction in the backlog. We will continue to monitor whether the backlog continues to decline.

In conclusion, the most recent USPTO statistics show that an appeal can relatively speedily get resolved (less than two years from notice of appeal in certain technology centers). So rather than filing one or more RCEs with further amendments, an applicant could consider an appeal for potentially a broader claim set. As we’ve previously discussed, if successful, the applicant gets the patent term adjustment back in the form of C-delay. Sometimes, it pays to be patient.

 

 

PTAB: Protein modeling software claims are patent-eligible, arguing preemption

It has been over a year since the Federal Circuit decided McRO v. Namco Bandai. In short, McRO decided that software models can be patent-eligible. This long-awaited case sent ripples of hope to many in the patent bar, especially to those reeling from the confusion and unpredictability of Alice decided two years prior. But the McRO message has still not made its way to all examiners, especially in the life sciences. Fortunately, the PTAB sees fit to correct and overturn such examiners, as shown in a recent case Ex parte Ohrn, Appeal No. 2017-003914 (PTAB Nov. 20, 2017).

In Ex parte Ohrn, the Examiner had argued that the claims simply used a computer as a tool, i.e., “converting one form of numerical representation into another by organizing information through mathematical concepts,” and were thus an abstract idea. In addition to holding that this was an overgeneralization of the claims, the Board used three main arguments to counter this assertion.

First, the Board found that the exact manner in which the modeling was implemented was novel, and thus the Examiner failed to provide evidence that the computer was used simply as a tool for generic activity. The Board found that the “claimed method uses a combined order of specific rules that render information into a specific format that is then used and applied to create desired results.”

Second, the specific, claimed features of rules permit the improvement realized by the invention. Claim 1 focused on a specific articulated improvement in protein modeling instead of a result of an abstract idea itself.

Third, the Board found the preemption argument persuasive that the specific method recited in the claims did not improperly monopolize the basic tools of scientific and technological work. It cited fairly specific characterizations made by the appellant of what the claims do not cover.

While the preemption argument can be a strong one, the savvy patent practitioner will tell you that this argument is not without consequence. For purposes of prosecution history estoppel, characterizations made on the record as to what the claimed invention does not cover greatly weakens or even destroys such equivalence coverage in litigation. But a granted patent narrowed by such prosecution history estoppel can be better than an application where the argument was not used, leading to an abandoned application. That being said, the preemption argument can be a double-edged sword.