How appeals can stop Examiner tricks that needlessly undermine patent applications

Patent Examiners are tasked with a daunting task of checking each patent application for compliance with all the patent laws and rules. Most importantly, the Examiner must show that the claims are not unpatentable, including being free and clear of prior art. And they must do all this within the time expectations that the USPTO offers.

But sometimes it seems like Examiners are engaged in a sophisticated game of cat-and-mouse. Some Examiner tricks, which aren’t expressly prohibited by the rules and incentives offered by the USPTO, cut corners to make their jobs easier. And some might say that the frequency of these games has increased in recent years. But left unchecked, the consequences of these tricks can undermine applications in serious ways.

To their defense, Examiners are allotted only a limited number of hours in the day to reach the bi-weekly expectation levels (or a bonus for ambitious Examiners). This expectation is driven by a simple formula:

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Source. As an example provided by the USPTO, let’s say that an Examiner works 36 hours a week. If the Examiner is starting out at GS7 in the complex field of satellite communications, this examiner is required to perform enough work to generate about 3.6 production units (or 7.2 counts) every bi-week (72 x 0.7)/27.7. That is the equivalent of 3 Non-Final Office Actions (1.5 counts each), 14 Final Office Actions (.25 counts each), 2 first-time RCEs (1.75 each), or 7 Notice of Allowances (.5 each) per week.

An Examiner drafting three Office Actions in a week would have 12 hours per Office Action. This is not quite two days of work for each application, to perform the search, consider the prior art, and draft the Office Action. No small task, especially with this complex subject matter.

On top of this, Examiners are cautious about allowing cases for fear that an allowed patent application does not meet a patent quality assurance threshold. In this case, an allowed case could get referred back to the Examiner to try again.

With these incentives in mind, it is easy to understand the first examiner trick: cutting corners on a quality first Office Action. Good examiners understand that a good initial prior art search sets the stage for the entire prosecution of an application. It’s best to conduct the best and most thorough search once, right at the get-go, applying the closest prior art references to the invention. Once this prior art search is done well, the Examiner can really just slightly modify the rejection as the applicant attempts to distinguish the claims.

But based on the allotted time given to examiners, it might take an examiner more than a few days to familiarize oneself with the claimed invention, perform the search, consider the prior art and draft the Office Action. Some Examiners cut corners with this initial search, applying references that are easiest to find, but not very related to the invention. But because the references may have snippets that can be arguably broadly interpreted to disclose aspects of the claims, the Examiner applies them and moves on. And because often times applications go through several rounds of prosecution, the Examiner may think to perform a better search down the road, with potentially more relevant prior art. This is bad for applicants for a number of reasons.

For one, it wastes money and time. Some Examiners become attached to their own work product and refuse to see error in the first Office Action. Thus, it can be difficult to persuade the Examiner to withdraw a rejection through argument alone. This behavior is reinforced by the USPTO not granting counts for a Non-Final Rejection do-over. So if claim amendments are not introduced, Examiners–hungry for RCE counts–typically issue a Final Rejection with little change to the original analysis.

Sometimes, Examiners offer to cut a deal where a claim amendment is introduced to distinguish the applied prior art references. Applicants, incredulous at being required to distinguish from very different prior art references, may take this option. But no proposed claim amendment is guaranteed to result in an allowance. Examiners may commit to overcoming the current rejection, but a revised rejection with perhaps a different prior art reference can easily be manufactured.

Thus, “working with” the Examiner may give the applicant false hope, leading the applicant to continue to try different claim amendments without committing to allowance. These Examiner-appeasing amendments carry no guarantee of advancing prosecution, and instead often drag out prosecution even through the RCE process, so that the Examiner can get more counts.

Besides expense and wasted time, each argument and/or clarifying amendment used to distinguish a prior art reference makes up the prosecution history estoppel. This is disadvantageous because it narrows the scope of coverage of the claims during enforcement of the patent. As the Supreme Court made clear in Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., an applicant that makes a claim amendment to comply with the Patent laws automatically assumes surrender of the territory between the original claim and the amended claim. This means that there is a presumption of surrendering all equivalents for the particular claim limitation that was narrowed by the amendment. For an application that has many amendments over many Office Action responses, the consequences can be substantial.

The second trick is the examiner requiring narrower claims than is required by the law. Even when an Examiner performs a very exhaustive search in the prior art, there is still no guarantee that a killer prior art reference is just around the corner. That is partially why Examiners will almost always want more narrow claims than are needed to overcome prior art so they can pass a patent quality assurance threshold. In general, the more features and claim elements the better for the Examiner to pass scrutiny. It can be tempting to pursue a strategy that pursues narrower claims to get a quick notice of allowance. But unless an Examiner can show why a more narrowing claim amendment must be made in a prima facie rejection, it is not a legally proper rejection.

The savvy patent practitioner knows that the fewer the claim amendments and the shorter the prosecution history, the better. An appeal early in prosecution (upon receiving a Final Rejection) can shortchange the negative implications of prosecution history estoppel. Rather than distinguishing and amending against a circulating set of unreasonable prior art rejections, the Board can decide the first unreasonable set. And if completely successful (no other grounds of rejection affirmed and no new rejections by the Board), a Notice of Allowance should issue. Plus, with Anticipat Research, you can see the reversal rate for your specific ground of rejection for your specific Examiner, art unit, tech center, etc.

Quit playing games and instead be strategic. That is why appealing can be a good solution.

Anticipat’s Mission: Help Patent Practitioners Succeed with the Best Data

We at Anticipat have a passion for improving patent prosecution by harnessing better data. We want our users to succeed in their own practices with the help of this data.

Better data includes aggregate ex parte appeals data that is relevant to grounds of rejection practitioners face. That is, an Office Action with a particular ground of rejection with specific reasoning has very likely been overturned on appeal in another application. We connect these dots for you. 

Better data also includes more general metrics, such as the reversal rates for specific grounds of rejection for a given Examiner, art unit, tech center. It also includes having the arguments and legal authority that the Board has used in overturning specific Examiner rejections.
While much of Anticipat’s initial focus and expertise are on Board data, it is only a piece of the puzzle. Our holistic approach requires data of all facets of patent prosecution, as well as a deep understanding of the context of patent prosecution procedures. We strive to further understand the incentives and behavioral decision-making patterns of all parties involved in the patent system so that proper context of USPTO statistics is understood and applied.

Only by having the best data can you optimally guide your prosecution strategy. With this arsenal of data, you can anticipate expected outcomes and put yourself in the best position for success. We hope you’ll join us on the journey. Click here to get started.

Obviousness Reversal Rates Across Tech Centers: Unexpected Results

Obviousness is by far the most common rejection that gets appealed to the Board. This particular ground of rejection does not draw attention for being reversed at the low end or on the high end. Over the past year and a half, the 12,000 obviousness decisions were wholly reversed about a third (34%) of the time. And 43% of the appeals are at least partially reversed. One might expect these rates to be uniform across tech centers. They are not.

Here is a detailed breakdown of the appeals across tech centers.

Tech Center 1600 1700 2100 2400 2600 2800 3600 3700 total
Reversed 251 558 375 436 360 291 858 1000 4166
At least partial reversed 71 135 120 161 132 48 210 308 1205
Affirmed 649 1143 901 916 857 414 885 935 6796
Total 985 1876 1423 1536 1374 763 1973 2299 12397
Reversal rate 25% 30% 26% 28% 26% 38% 43% 43% 34%
At least partial reversal rate 33% 37% 35% 39% 36% 44% 54% 57% 43%

For appeals in tech center 1600, pharma/biotech, the reversal rate is the lowest. Only a quarter of such appeals are wholly reversed and only a third are at least partially reversed. The chemical arts of tech center 1700 are only slightly better.

Next, tech centers 2100, 2400, 2600 and 2800 comprise computer and electrical art. These are reversed at a higher rate than the biotech and chemical tech centers, with tech center 2800 being the most overturned of the bunch.

Next, tech center 3600, which is predominately software/business methods, has a much higher reversal rate than average. That is, 43% of these appeals are wholly reversed and 54% are at least partially reversed.

Next, tech center 3700, which is home to mechanical and medical device technology also has a much higher reversal rate than average. That is, 43% of these appeals are wholly reversed and 57% are at least partially reversed.

obviousness

It is interesting that the biotech/pharma and chemical tech centers are lower than the average reversal rates. It is also interesting that the software/business methods and mechanical/medical device tech centers are reversed at a higher rate than average.

Why are some tech center reversal rates higher than others? For obviousness, this is no simple inquiry and instead requires considerable context. It starts with how strong is the Examiner’s rejection. Some fields are more crowded than others, making it easier for an Examiner to find prior art that would show obviousness. The Board panel that decides these appeals are technically trained in the technology center that they decide cases. They evaluate the legal and factual merits of the appeal. And theoretically, the Board will objectively evaluate each appeal equally. So for some tech centers where the reversal rates are low, this may signal that Examiner rejections are stronger than tech centers where the reversal rates are high.

Another reason relates to how “well” do the appeal conference examiners forward to the Board. The examiner conferences serve as a gatekeeper by reopening prosecution or even issuing a Notice of Allowance for bad rejections. But if these examiner conferences forward these bad rejections to the Board more than others, then the reversal rate goes up.

A third reason relates to the judges not being completely neutral in their decision-making. Instead, some judges may lean toward the Examiner while others may lean toward the appellant.  The more the judges lean toward Examiners, the lower the reversal rate; the more the judges lean toward appellants, the higher the reversal rate.

Next, some technology centers may be made of aggressive applicants who may want to stretch the claim coverage into the gray area of what their applications deserve. Many applications that seek to cover pioneering technology will understandably be ambitious in its scope. Other applicants may be more interested in adding another number to their patent arsenals.

These less ambitious applicants may be less interested in broad claims and appeal only at a significant impasse with the Examiner or with a particularly unreasonable rejection. The collective aggressiveness of applicants could affect the reversal rate within a tech center.

Anticipat provides the proper context to make sense of how likely it is for an application to succeed on appeal, say, if faced an obviousness rejection. With Anticpat Research, you can quickly identify those applicants in your art unit or tech center to provide a holistic context to the reversal rate numbers. Also with practitioner analytics, you can now input a customer number to see how often a particular applicant succeeds on appeal. Comparing apples to apples takes away the unexpected and instead gives you power to incorporate the statistics into powerfully guiding your prosecution strategy.

 

 

 

 

 

 

 

How Appealing a Patent Application Before Filing an RCE Can Yield Big B-Delay PTA

Patent prosecution has a bevy of procedural options for a wide range of preferences. For those who want to maximize the life of the patent and aren’t impatient in getting the grant, some strategies promote maximum patent term. Here, we discuss how appealing a patent application can promote patent term adjustment (PTA), even if the appeal is unsuccessful.

We recently reported on how a successful appeal (not unpatentable for at least one claim) can result in C-Delay PTA. This gives all the time wasted in getting a favorable disposition from the Board back to the patent’s term. But if the appeal is unsuccessful (i.e., the decision comes back upholding a rejection with respect to all claims), and the application does eventually get granted, B-Delay can still replenish this lost time as PTA. But to do so, it must follow a certain timeline.

In general, B-delay is available when the USPTO does not grant a patent within 36 months. That is, every day over the 36-month mark that it takes to grant your application goes into your B-delay PTA. But B-delay is unavailable for the time after an RCE is filed. This point has implications for deciding when to appeal a decision, especially since the appeal process can be long and since not every appeal will be successful.

Under this approach, appeals are used strategically rather than as a procedure of last resort. Instead of filing an RCE to continue examination, an appeal is filed. Many applicants, do indeed use appeals strategically. If the appeal is affirmed, and if an RCE is filed to continue examination and the application eventually does get granted, then does the

An example shows this approach in action. US Patent No. 9,701,462 was recently issued with a whopping 2,230 days of PTA. The secret to over six years of PTA? Appeals. After receiving a Final Office Action, the applicant straightway appealed. The Board affirmed the Examiner, but introduced a new rejection. Subsequently, the applicant responded with an Amendment. The Examiner responded with a Final Rejection, after which the applicant appealed again. This time on appeal it was affirmed-in-part. Because an RCE was never filed, it qualified for 1231 days of B-delay.

pta b delay

This appeal-before-RCE strategy is difficult to pursue in practice—not a trivial or whimsical exercise. It takes preparation to make sure all the necessary evidence is on the record and that the claims are just the way they should be for appeal (before a Final Office Action closes prosecution). Indeed, you may want to front-load much of the back-and-forth work with the Examiner with at least one interview.

Another difficulty is more psychological. Some examiners may confuse the situation by offering a hope (sometimes a false hope) that prosecution is close to concluding. Then the practitioner believes that just one more narrowing amendment is needed. But is this one little amendment needed to allow the case? Or is it needed to overcome the current rejection? Or will the Examiner not even commit to that one narrowing amendment overcoming the current rejection? Many cases with long prosecution histories are made through a series of small amendments.

However difficult it is to front-load the work at the first response, and however difficult it is to weed through the hopeful assurances of the Examiner, appealing early on can pay off big dividends in the form of PTA.

 

Recent ex parte appeal PTAB decision cuts a corner to avoid deciding an appealed rejection

Patent Office employees are creatures of incentives. It is well-known that patent examiners earn various counts for use in the USPTO’s internal quota system. PTAB judges are also measured by a count-based system, which is based on the number of decisions they author. It is no secret that Examiners and PTAB judges at times get creative with policies and practices to most easily meet their quotas. Here, we look at a recent decision that shows a practice of PTAB judges deciding only one ground of rejection without looking to the remaining pending ground on appeal.

In deciding grounds of rejection on appeal, the three judge panel almost always decides all the contested pending rejections. Of course, if an appellant chooses not to argue against a ground of rejection in the appeal brief, the Board will summarily affirm the rejection. Very rarely, the Board decides only one ground of rejection on appeal and lets that carry the day, without deciding other pending grounds of rejection. This rarity is found in recently decided Ex Parte MacArthur et al (PTAB Jan. 2, 2018).

In Ex parte MacArthur, the appellant had challenged both a Section 101 abstract idea rejection and a Section 112 indefiniteness rejection. But the panel never even reached the second ground of rejection. After affirming the abstract idea rejection, the panel “exercised [their] discretion” and “declined to reach the merits of the Examiner’s remaining rejection.” This, after the appellant had devoted nine pages of argumentation on the Section 112 rejection in the appeal brief and the reply brief.

To support its discretion not to reach the remaining issue on appeal, the Board cited to two Federal Circuit cases. In re Basell Poliolefine, 547 F.3d 1371, 1379 (Fed. Cir. 2008) (“Having concluded that the Board properly affirmed the rejection of claims 1-52 of the ‘687 patent based on obviousness-type double patenting in view of the ‘987 patent, we need not address the remaining issues raised by Basell regarding the §§ 102(b) and 103(a) rejections, as well as the additional double patenting rejections.”); Beloit Corp. v. Valmet Oy, 742 F.2d 1421 (Fed. Cir. 1984) (ITC having decided a dispositive issue, there was no need for the Commission to decide other issues decided by the presiding officer). Another interpretation is that the panel found a way to achieve the same credit for deciding this appeal without the work of deciding the second issue.

Ex parte MacArthur is certainly not the first to use this kind of discretion to decline the call to decide remaining issues on appeal. Another relatively recent case, Ex parte Palmer (PTAB Mar. 10 2016), summarily affirmed a 112 rejection and proceeded not to reach several 103(a) rejections. In this analysis, the Board justified not reaching the 103(a) rejections by expressing concern for managing the Board’s docket. It also cited to the same ITC case above.

To the defense of PTAB judges, often there are many fact-specific grounds of rejection to be decided on appeal, which require time to analyze and write up. Especially in Ex parte Palmer, it would have taken a lot of time for the panel to pore over multiple references in deciding several obviousness rejections. But even though this requires a lot of time, it’s what PTAB judges do. That is, these decisions that do not decide all contested issues are extremely rare compared with the overwhelming majority of decisions that decide every issue that is argued. Interestingly, both of the above-discussed decisions come from the same tech center of 1700.

True, the appeal backlog has historically forced the PTO to get creative and balance resources at the BPAI/PTAB. But this decision not deciding an issue on appeal comes amid plunging backlogs for ex parte appeals. For example, as we recently reported, in the past year the backlog for tech center 1700 has dropped from 22.8 months to 16.9. Thus, the concern for creatively using judge resources is less compelling.

Plus, a half-baked effort at the PTAB may do little to speed up efficiency at the USPTO anyway. After a rejection is affirmed at the Board, the applicant can still prevail on this issue after reopening prosecution, either through additional argumentation or amendments. And back in the Examiner’s docket, if the Examiner still digs into his/her position on the other issue that was never decided by the board, then it would require another appeal to resolve. Better to do the job right the first time, even if it is tempting to take the shortcut in the decision.

 

Abstract idea rejections in biotech/pharma are overturned far more than other technologies on appeal at PTAB

Since 2014, the USPTO has recognizably tried to come up with a holistic framework for determining subject matter eligibility for all sorts of patent applications. In particular, several subject matter eligibility guidelines have been issued in light of recent Supreme Court cases Myriad, Mayo, and Alice and subsequent Federal Circuit decisions. But this endeavor has not been easy. Especially in making a two-step solution for judicial exceptions work for all Examiners across all technology centers. Since appeals can be thought of as an ultimate mechanism for holding Examiner rejections accountable, here we look at how the Examining corps is doing with abstract ideas by looking at how the rate of reversing abstract idea rejections on appeal compares across tech centers.

By far the most common of the judicial exceptions—and the most elusive–is the abstract idea. Further to our recent report, abstract idea rejections are ubiquitous across all tech centers. They also get appealed in every tech center, but the reversal rate is far from uniform. The following shows the numbers and reversal rates of each tech center over the course of the past year and a half. We discuss two noteworthy tech centers.

techcenter

The first noteworthy tech center is 3600, where the bulk of the abstract idea appeals take place. This tech center, home to much of the USPTO’s business methods/software applications, has a very low reversal rate: 14%. In fact, the large volume of appeals in this tech center alone seems to substantially drag down the entire overall abstract idea reversal rate. See below graph.

The second noteworthy tech center is 1600. Even though the overall reversal rate has gone down since our last report (17% to 16%), tech center 1600, home to the biotech and pharma technical art, has actually solidified at a much higher rate. Specifically, this tech center’s reversal rate has increased from a rate of 28% to 37%. Even while having a limited sample size of 35 abstract idea decisions, this finding is significant. The probability that this reversal rate is higher just due to chance is quite low.

tech center

Why the higher-than-normal reversal rate in biotech? A couple possible reasons. First, possibly most intuitively, Examiners in the biotech/pharma technical space may be issuing and maintaining bad abstract idea rejections more frequently than Examiners in other tech centers, forcing the applicant to appeal. And the judges that are deciding these appealed applications are siding with the appellant more often than in other tech centers.

To the defense of Examiners in tech center 1600, the abstract idea doctrine is not as developed in the biotech/pharma space as other technologies. More prominent patent-eligibility cases in this technical space have focused on the other judicial exceptions: laws of nature (Mayo) and naturally occurring phenomena (Myriad). The lack of much abstract idea case law in biotech may create a blurry boundary line between patent-eligible inventions and patent-ineligible abstract ideas. Plus, with the infusion of computer-technology into life sciences, the applicability of other abstract idea case law has added further complexity to the analysis. Thus, Examiners may feel restricted in allowing a case, waiting for a Federal Circuit to provide a green light to support their position. But the Board seems not to be waiting around. Instead, the Board appears to be supporting the appellant’s position more often than in other tech centers, at least by saying that the Examiner has not met his/her burden of showing patent-ineligibility.

The second reason is that biotech/pharma applicants may have high stakes and/or resources to devote to pursuing broad claims than others (e.g., software applications). Compare these stakes and resources with where the bulk of abstract idea rejections on appeal come from, tech center 3600, where many of the business method applications reside. It is possible that biotech applicants are more motivated and less discouraged from winning on appeal. And as has been shown, not all appellants are equally successful in overturning abstract idea rejections on appeal. And perhaps the applicant or the counsel are driving strategy that fosters a more favorable appeal outcome for abstract ideas.

The USPTO will continue to struggle to strike the right balance between what is patent-eligible subject matter, but having the right appeals data from Anticipat Research can cut right to the heart of how specific grounds of rejection are being overturned on appeal. Even if the reason why remains elusive, biotech/pharma appears to be fertile room to appeal an unreasonable abstract idea rejection.