IP Outsourcing and Management

The United States Patent and Trademark Office (USPTO) has recently announced that it has prepared further interim guidance for the patent examining corps to use when determining subject matter eligibility under 35 U.S.C. § 101 in view of the recent decision by the United States Supreme Court in Bilski v. Kappos. This interim guidance is a supplement to previously issued interim instructions dated August 24, 2009, and it supersedes the interim guidance memo to the examining corps dated June 28, 2010.   The USPTO is seeking public comment on this interim guidance and intends to issue final guidance after evaluating the public comments.

According to the USPTO, the interim guidance sets forth the factors that should be considered in determining subject matter eligibility of method claims in view of the abstract idea exception.   According to the guidance, the machine-or-transformation test remains an investigative tool and is a useful starting point for determining whether a claimed invention is a process under 35 U.S.C. § 101 but, as the Supreme Court made clear, is not the sole test for determining subject matter eligibility.  The interim guidance provides additional factors to aid in the determination of whether a claimed method is an abstract idea.

“With this set of interim guidance, we are providing the patent examining corps and the IP community with additional guidance regarding factors that may be considered in determining subject matter eligibility in light of the Supreme Court’s decision in Bilski,” said Under Secretary of Commerce for Intellectual Property and Director of the USPTO David Kappos.  “We now seek input from the public as we further refine and finalize this guidance.  In the meantime, this interim guidance will assist our examiners in their examination of applications where subject matter eligibility of method claims must be determined.”

For more information, see the July 27, 2010 Federal Register at: http://edocket.access.gpo.gov/2010/pdf/2010-18424.pdf.

The interim guidance was signed on July 21, 2010.   An internal memo issued to the patent examining corps on the subject can be found on the USPTO Web site:

http://www.uspto.gov/patents/law/exam/bilski_guidance_27jul2010.pdf

The Supreme Court issued its ruling in the infamous “In re Bilski” case today.    The bottom line:  Bad news for Bilski, but probably good news for software patent holders.

Bilski attempted to claim a hedging method as his invention.  Specifically, “a method of provide one of a good or service to at least one entity at one of a payment, rate, or price that is capped at a predetermined amount, comprising.  .  .”

The Patent Office rejected this claim (along with several other claims) and the Federal Circuit upheld the rejection.  Not only did the Federal Circuit reverse its earlier “State Street” decision which allowed business method patents, it went further with a decision that could have destroyed many true software patents.

In Bilski, the Federal Circuit re-introduced an old rule called the “machine-or-transformation” test.  Specifically, the Federal Circuit held that a process is not patent eligible unless: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing.  The Federal Circuit also concluded that this “machine-or-transformation test” is the sole test for determining patent eligibility of a “process” under section 101 of the patent statute.

A literal application of the “machine-or-transformation” test could have invalidated many existing software patents.

The Supreme Court held that it was wrong for the Federal Circuit to hold that the machine-or-transformation is the sole test for determining patent eligibility.  They also stated that business method patents might be patentable even if the particular claims in Bilski were not.  The Supreme Court held that the claims of Bilski were directed to abstract ideas.  Consequently, they were not patentable.

The Supreme Court, however, did not specifically address software patents and kept its discussion focused on business method patents.  Consequently, it appears that software patents are indeed safe.  Of course, the question for patent attorneys is how to distinguish an abstract idea from a process claim in a software patent.  The Supreme Court did not provide a way to determine abstract ideas from concrete steps.  But then, the  Court has never been known for actually developing workable rules.

One relatively safe approach might be to follow our European counterparts.  In Europe, software patents are not patentable per se. However, such restrictions are easily avoided by claiming a computer running a particular process.  It seems that such a claiming strategy might be a safe bet for the U.S. until the lower courts can add more definitive rules.

Ironically, several of the European Patent Office’s (“EPO”) new rules will take effect on April 1st.  The new rules are touted to be part of the EPO’s “raising the bar initiatives” which according to the EPO, are designed “to improve the quality of incoming patent applications and streamline the grant procedure.”

Many of the rules are designed to discourage behavior by some applicants – especially U.S. applicants.

By way of background, the philosophy and structure of the EPO examination process is different than the United States Patent and Trademark Office (“USPTO”) examination process.  Many US applicants attempt to impose “US practice” on EPO examiners.  Often such behavior is innocent and is based on almost complete ignorance of the EPO rules.  Apparently, even this innocent behavior has been relatively successful.  The EPO views these attempts as ways of circumventing the process.  The recent rule changes are the EPO’s latest attempt at thwarting this behavior.

The EPO patent examination process consists of a formalities examination, a search phase (traditionally performed at the Hague by searchers), and a substantive examination phase based on the search (traditionally performed in Munich by examiners).  Once the process passes to the substantive examination phases, the search division typically does not perform additional searches.  This is in contrast to US practice, where the examiners will routinely perform additional searches in response to claim amendments and modifications.

The new rules are designed to force applicants to enter the examination phase with a single amended claim set that actually defines their invention and is based on the results of the EPO’s search.  The new rules are designed to eliminate multiple searches when the claim amendments change the scope of the rules.  Theoretically, the new rules should prevent claims that reach beyond the scope of the original search and claims which have scope beyond the scope of the priority document.

Some of the rule changes are:

One Independent Claim Per Category [Rule 62a]

Incomplete Search [Rule 63]

Shortened Time Limit for Filing Divisionals [Rule 36(1)]

Mandatory Response to a European Search Report [Rule 70a and 161]

One Opportunity to Voluntary Amend [Rule 161(2)]

Mandatory Basis for Amendments [Rule 137]

Mandatory Submission of Prior Art (from Regional or National Filings) [Rule 141 and 70b]

With the goal of keeping this notification brief, the rule changes will be generalized and summarized below.  The reader should review the actual rules for a complete understanding of all of the nuances and exceptions to the broad generalizations listed below.

One Independent Claim per Category [Rule 62a] – Through fee increases, the EPO has tried to limit the number of independent claims before.  Apparently, without muc success.  The new rule mandates one claim per category.  Under the EPO policy, the categories of claims are: products, process, apparatus, and use.

Incomplete Search [Rule 63] – This rule is designed to stop broad claims.  It authorizes the search division to require an applicant to more narrowly define the field of search if they find that it is impossible to carry out a meaningful search based on broad or ambiguous claims.

Shortened Time Limit for Filing Divisionals [Rule 36(1)] – This rule is designed to stop on-going continuation practice.  According to Allison Brimelow (the current EPO president), you only deserve on patent per invention.

Mandatory Response to Extended European Search Report (EESR) [Rule 70a] – This rule is designed to encourage claim amendments before the examination phase by requiring a substantive response to the ESSR before the examination phase is entered.  Under new Rule 70a EPC, a response to the EESR is due within the time limits for requesting the examination (6 months from the EESR or 31 months, whichever is later).

Mandatory Response to the PCT IPER [Rule 161] – Rule 161 makes it compulsory to respond to the objections raised during the PCT international phase when the EPO has produced the ISR or the IPER.  The applicant must now respond within a period of 1 month from the Rule 161 communication, or the application is deemed withdrawn.  Again, this rule is designed to encourage claim amendments before the examination phase by requiring a substantive response to the ESSR before the examination phase is entered.

One Opportunity to Amend [Rule 161(2)] – Under rule 161(2), the application may only be voluntarily amended once: before a request for examination is filed or 1 month after a Rule 161 communication is mailed. This rule is also designed to encourage amendments before the examination phase.

Mandatory Basis for Amendments [Rule 137] – If amendments are made, the Applicant must now supply the basis for amendments.  Remember that the EPO’s rules for basis of claims are much stricter than the USPTO.  If the basis is determined to be insufficient, the Applicant has 1 month to respond. Amendments may not relate to any unsearched subject matter.  This rule is designed to keep applicants from adding new matter and broadening claims beyond original search or priority document.

Mandatory Submission of Prior Art (from Regional or National Filings) [Rule 141 and 70b] – In what I hope is not the first step towards a US style IDS practice, the applicant is now required to file a copy of the results of any search carried out by the authority searching the priority document, when entering into Europe (either Direct or PCT) and “without delay” after such results are available to the Applicant.  Furthermore, the EPO can request this information and Applicant has two months to respond to the request.

These changes once again emphasize the need for an active and updated international patent portfolio plan and early involvement of an attorney knowledgeable in the EPO patent process (if Europe is a priority region for the portfolio).  With these new rules, more thought must be given to submitting filings in accordance with the conventions of other countries at the priority document filing stage.

Bill Naifeh is a patent attorney in Dallas, Texas.  He consults with clients about the development of their international patent portfolios.  He also works with clients on a part time “in-house” basis to assist clients with the management of their patent portfolios.  His website is www.naifeh.com and his blog for patent issues is www.ip-outsource.com .

The Legacy Approach: For decades, patent attorneys have been taught to submit claims to the USPTO that are as broad as possible.  The theory is that submission of broad claims are opening gambits in a negotiation process that will ultimately yield the correct scope of claims for the applicant.

The Current Situation: The patent prosecution situation has radically changed over the past few years.  A combination of political pressure on the USPTO and case law have made patents harder to acquire than any time in recent memory (although the Obama administration appears to increasing the allowance rates).  Furthermore, the patent office is buried in applications.  In some technical fields, it often takes several years before a first office action is even issued.  Operating under a legacy theory of broad claiming often will result in significant disadvantages to the applicant.

Some of the disadvantages with broad claiming are:

• Loss of Equivalents – At the risk of oversimplification, when an applicant narrows his claims during prosecution, the applicant gives up any equivalence relating to the narrowing amendment.  Broad claiming usually results in claim amendments and claim amendments usually result in a significant loss of equivalence to the claim terms.

• Loss of a Chance at Negotiation – In years past, the patent office would issue two or three non-final rejections before issuing a “final rejection.” Multiple non-final rejections gave applicants room to effectively negotiate to the correct claim scope.  Currently, examiners issue one non-final rejection and one final rejection which are usually based on the first claim set.  Because final rejections severely limit the Applicant’s ability to amend claims, Applicants essentially have one chance at negotiation.  Thus, they simply do not have the luxury of the back and forth negotiation process of times past without filing additional continuation requests.  Essentially, applicants have one shot at negotiation.  Broad claims render this negotiation chance useless because the parties will always be too far apart to effectively reach a compromise.

• Obviousness – Recent case law has made it easier than ever for an examiner to reject an application based on “obviousness.”  Broad claiming allows the examiner to easily “knock out” the independent claims with anticipation arguments, then allows the examiner to knock out each of the dependent claims with obvious arguments.  Under current case law, these obviousness arguments can be extremely difficult to overcome.

• Angering the Examiner – Most patent examiners are young engineers who are not familiar legal nuances nor with potential malpractice law suits.  When they receive an application with broad claims, they immediately become defensive and view the initial submittal of broad claims as a waste of their time.  They will then “knock” out the claims based on art that may not even be that relevant to the invention.

A New Approach: For many applicants, the current situation requires a fresh approach to the patenting process.  In contrast to broad claiming, it may be better to just claim the invention.  In other words, provide claims which cover an exact or nearly exact copy of the invention.  Then, once some claims are allowed and the most relevant prior art has been identified, the applicant can broaden the claims using continuation practice to claim additional patent scope.

Advantages of narrow claiming are:

• Teaching the Examiner – most examiners no longer read the specification.  They simply turn to the claims and start conducting word searches to “knock” the claims out.  A narrow claim essentially explains the invention and forces the examiner to understand the invention.

• Most Relevant Art is Uncovered – Narrow claiming forces the examiner to find the most relevant art rather just knocking out the broad claims based on art that may not be relevant to the actual invention.

• Obviousness Rejections are Easier to Overcome – Narrow claiming forces the examiner to try to knock out all of the elements of a claim.  This forces them to combine multiple references.

• Preserves Equivalents – because most of the claim elements will not be narrowed during prosecution, there is less chance that prosecution history estoppel will prevent the application of the doctrine of equivalents.

• Faster Patent Protection – obviously, narrow claim will reduce the negotiation process which will provide for faster allowance.  Again, the scope of protection can be widened later with continuations.

Disadvantages:

• Additional Work – under this approach, one should still draft broad claims, but place these in a “claim bank.” A “claim bank” is a section towards the end of the application which consists of claim-like sentences of varying scope.

• Additional USPTO Fees – because additional protection will be obtained through the use of continuations, there will be additional filing fees and maintenance fees paid to the USPTO.  However, these USPTO fees are likely to be offset against much lower attorney fees.

If narrow claiming has potential advantages, why do most outside law firms actively encourage the practice of submitting broad claims?  First, one should realize that patent attorneys are creatures of habit.  Second, one should keep in mind that many law firms have been sued for legal malpractice for claiming less than the applicant thought they should have received.  Obviously, broad claiming can provide an effective defense to a law firm in future cases.  Third, broad claiming will typically lead to numerous offices actions from the USPTO which will result in a greater amount of legal fees during the course of prosecution.

Every situation is unique.  So, narrow claiming may not be right in every situation.  However, narrow claiming should at least be considered when developing an overall patent strategy.

Bill Naifeh is a patent attorney in Dallas, Texas.  He often works with clients on a part time “in-house”  basis to assist clients with the management of their patent portfolios.  More information may be found at www.naifeh.com.

Saving on legal spending is top of mind for most in today’s market.  Finding ways to transition to less expensive legal services without the sacrifice of quality and value is a big task.  A thoughtful approach and some short-term expense will be required, but may be worth the investment.  This article outlines just a few ideas to consider for reducing costs in the area of intellectual property.

A place to start is a simple review of your outside counsel invoices.  There are likely traditional billable events that you can ask outside counsel to stop performing thus reducing unnecessary billing.  What might seem to be a small expense at first glance may add up over the course of a year and be particularly significant for a high volume IP portfolio.  Ask yourself if there are elements of the work within your IP portfolio that could be handled differently?  Perhaps some of the activity could be handled less expensively with the appropriate people, systems and processes in place.

Here are a few ideas to think about.

Reminder Letters – Do you really need them?

If you receive more than one reminder letter relating to a foreign filing deadline, PCT national stage application, broadening reissue deadline, etc. then consider the following.  Cut down on the number of reminder letters and chose when you’d like to receive reminder letters.  Receiving a reminder letter that doesn’t cause you to react to it may be an indication that you either don’t need it or the reminder letter is being sent to you too soon.

Additionally, if your company has engaged a payment service to take care of the payment of your annuities and maintenance fees, then reminder letters from outside counsel aren’t necessary.  For U.S. issued patents, consider filing a Fee Address form changing the fee address from outside counsel to the company so that all post-issuance maintenance fee statements are sent to the company rather than the law firm.  This change can be easily accomplished when the Issue Fee is paid.

More About Annuities and Maintenance Fees

The process of paying a company’s annuities, maintenance fees, or renewals is mostly administrative in nature.  Although tracking these payment deadlines is extremely important, it doesn’t require substantive analysis.  Savings can be realized by working with a payment service provider, taking this activity in-house and training your staff to handle the payment process.

Changing the U.S. Patent Office Correspondence Address

A more focused approach to saving outside counsel expense is to change the U.S. correspondence address from outside counsel to your internal IP legal department address.  This allows the client to gain better control over the work that outside counsel is performing by receiving all correspondence and only sending work to outside counsel that can’t be handled internally.  Implementing this process will immediately cut down on reminder letters and incidental activity from outside counsel.  Granted, in order to be able to handle this activity it becomes necessary to have the appropriately trained staff and docketing system in place to handle the influx of correspondence.  However, the upfront investment in these systems can save you thousands of dollars on your IP budget.  One company reportedly saved $600,000 a year by simply putting this process in place.

With a good docketing system, trained personnel and standard processes and procedures in place, the return on the investment could begin to make a noticeable reduction in your IP budget.

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Suzanne Kiefer is a consultant with twenty years legal experience who assists corporations and law firms in cost- saving recommendations, assessing and implementing enhanced IP docketing practices for patents and trademarks, improved workflow processes and non-attorney staff training.  Suzanne can be reached at 214-683-5662 or skiefer@kipconnections.com.

This course is designed for attorneys and agents with advanced experience in the PCT process.

Seminar Speakers:

Carol Bidwell | Consultant (World Intellectual Property Organization – PCT).  Formerly with the United States Patent and Trademark Office.

G. Harvey Dunn III | Chief IP Counsel – Dresser, Inc.

Bill Naifeh | Attorney – Law Offices of Bill R. Naifeh

T. David Reed | Consultant (World Intellectual Property Organization – PCT). Formerly with Procter & Gamble

Sid Weatherford | Senior Patent Counsel – Ericsson, Inc.

Luncheon Presentation (Ethics):

“The Best Defense Is A Good Offense: The Benefits of An Inequitable Conduct Defense”

Tonya Gray | Partner – Andrews Kurth LLP

Kacy Miller | President – CourtroomLogic Consulting

Topics:  The following topics will be covered in this one-day seminar

The PCT:  A Brief Refresher of PCT Features and Safeguards

The Paris Convention, Priority Claiming and Restoration

Incorporation by Reference:  When and how to use it, caveats and difference from US incorporation by reference and practice

The PCT From an Applicants View:  A look at the PCT and the options, choices and decisions an applicant must make, including choice of Searching Authority, Receiving Office, etc.

Entering the National Phase:  Strategies for Entering the National Phase

The U.S. National Stage:  35 USC 371 vs. 35 USC 111(a)/35 USC 120 – National Stage Entry vs. “the Bypass Route”

Factors in deciding where to enter the National Phase

Searching the WIPO Database and Internet Resources

Where to Get Help at WIPO

Overview of the EPO Process – including new EPO rule changes and EPO requirements

Preparing and prosecuting patents in Europe – including a discussion with a panel of in-house patent counsel discussing EPO Gotcha’s.

When:

February 10, 2010

8:30 a.m. – 5:00 p.m.

Seminar Location:

Southern Methodist University (Plano)

5236 Tennyson Parkway – Building 4

Plano, Texas 75024

Registration Information:

$295.00 ($325.00 after January 27, 2010)

Registration form available at www.kipconnections.com.

This course is designed for paralegals, foreign filing specialists, legal administrators and patent attorneys and agents with little to no PCT experience.

Seminar Speakers:

Carol Bidwell | Consultant – World Intellectual Property Organization and formerly with the United States Patent and Trademark Office

Suzanne Kiefer | Principal Consultant – KIP Connections, LLC

T. David Reed | Consultant – World Intellectual Property Organization  and formerly with Procter & Gamble

Topics:  The following topics will be covered in this two-day seminar

Introduction to the PCT System

International Phase, Chapter I – International application and International search

Filing an International application with the USPTO as Receiving Office (RO/US) including an explanation of who can be named as the applicants; requirements for being accorded an international filing date; choice of International Searching Authorities; how to fill out the PCT Request form

International Bureau as Receiving Office (RO/IB) – by choice or by circumstance

Electronic Filing Options in RO/US and RO/IB

Agents and Common Representatives; Signature Requirements and Withdrawals

Correcting Defects and Recording Changes in the Name and/or Address of Applicant, Agent, Inventor

Claiming Priority and Furnishing Priority Documents together with a brief discussion of Restoration of the Right of Priority

International Search

Supplementary International Search

International Publication and Internet Resources

International Phase, Chapter II – International preliminary examination

Filing a Demand – information on how to fill out the demand form

International Preliminary Examination

Amending the International Application and Filing Informal Comments

Fees Payable during the International Phase

National Phase Entry

Information on National Phase Entry in General

US National Stage Entry Requirements

PCT Docketing Guidelines including review of common PCT forms

When:

February 8 – 9, 2010

8:30 a.m. – 5:00 p.m. (ending at 3:00 p.m. on February 9)

Seminar Location:

Southern Methodist University (Plano)

5236 Tennyson Parkway – Building 4

Plano, Texas 75024

Cost:

$395.00 ($425.00 after January 25, 2010)

Registration information is available at www.kipconnections.com.

Most IP professionals know that it can take several months to hire qualified docketing personnel.  Docketing is a specialized position within the intellectual property field that requires a working knowledge of not only intellectual property issues and calendaring due dates, but also the computer skills necessary to effectively navigate and maintain an electronic docketing system.

Today, when organizations are frequently sued over issues related to administrative docketing errors, hiring docketing personnel inherently carries considerable risk.  A hiring mistake could cost millions of dollars.

There are several factors that contribute to the difficulty in finding qualified docketing personnel.

Typically, there are very few individuals within an organization who understand the necessary steps to ensure a solid docketing workflow process, and can manipulate the docketing software.  Replacing a departing employee or creating a new position can be extremely difficult when there is little or no significant experience within the organization. Sometimes, it becomes so difficult to find a suitable candidate that the docket responsibility will be added to the job responsibilities of a secretary, file clerk, or other clerical employee who may not have an appropriate amount of time to devote to, or invest in learning, the docketing system.

Docketing is an extremely stressful responsibility. There are many high-priority demands placed on docketing personnel, and the primary demand is an error-free work product.  A docket clerk is also expected to quickly turn around any data/communication, accurately interpret international prosecution correspondence, relay meaningful docket reports to attorneys, execute special client docketing requirements, conduct a seamless intake of new attorney portfolios, and understand and manage the electronic docketing software (and may also be expected to act as the database administrator when docket software problems arise).

Training docketing personnel is a challenge, since few external training opportunities are available within the industry.  Most training is delivered on-the-job by a senior employee.  In many cases, if the organization has lost its only docketing employee, there may be no one available to assist the training process.

A Dallas legal recruiter with Special Counsel Inc., Scott Bruce, says that “there are not enough experienced intellectual property candidates to fill available positions and finding an organization willing to provide on-the-job IP training is difficult.”

There are some steps that can be taken to ensure that the docketing department remains qualified.  It is important for all docketing personnel to receive regular training on substantive IP issues.  They should be included in any training provided to secretaries or paralegals, either in-house or from any of the available basic intellectual property seminars around the country.  A docketing position is a good stepping stone to an IP paralegal position, and gives the employee an edge if the opportunity becomes available to transition into an IP paralegal position.

Providing some hands-on experience working prosecution files in some aspect will also strengthen skill sets.  Teaching docketing personnel how to read and understand various statutes and administrative manuals will also be essential to ensure stability in the docketing position.

It is imperative that docketing personnel attend any available training conducted by the docketing software vendor.  Since electronic docketing software can cost an organization tens of thousands of dollars, it makes good sense to utilize any and all available software features in order to maximize the return on this investment.  In addition, docketing personnel should understand how each country rule calculates in the docketing software, and know where to put particular dates to ensure accurate calculations of action due dates.  Employees will only obtain this level of knowledge by investing time in substantive IP training, and the hands-on software application training provided by the software vendor.

Since recruiting can be a daunting task, some organizations prefer to promote from within – or “grow their own” docketing personnel – to ensure docket branding and to avoid inheriting an unwanted docket style. Remember that, even if an individual does not have direct docketing experience, there are some desirable qualities and characteristics to look for when interviewing potential candidates.  Generally, if a the candidate is professional, has solid administrative skills, makes minimal mistakes within document preparation, can research a problem and assimilate information well, is intuitive and able to anticipate next steps, and can remain calm in stressful situations, he or she has the potential to develop into a competent docketing employee.  Individuals who have a bit of litigation experience are also typically good candidates, since many of the same basic organization and analytical skills are essential to success.

Despite the hurdles that accompany the staffing and training process, it can be successfully accomplished – - it simply takes an investment of time and diligence to build a quality docket team.

Suzanne Kiefer is a consultant with twenty years legal experience who assists corporations and law firms in assessing and implementing enhanced IP docketing practices, improved workflow processes and non-attorney staff training.  Suzanne can be reached at skiefer@kipconnections.com.

As I explained in my October 25th post, the European Patent Office (”EPO”) has recently announced a series of rule changes that will become effective on April 1, 2010.  The topic of this post is the new EPO rule 70(a) which will force applicants to respond to written opinions with a short time frame or else the application will be deemed to be withdrawn.  This rule will apply to any application for which a search report is issued after 1 April 2010.

When the EPO carries out a search, they will issue a written opinion.  At present, there is no requirement to respond to the written opinion until the substantive examination has occurred.  Currently, if no response to the written opinion has been filed, the EPO will typically issue a communication setting a four-month term for responding to any objections raised in the written opinion.  In other words, applicants currently have at least 6 months, and normally at least 1 year, from issuance of the written opinion before they need to respond to any objections.

Under rule 70a (entitled: “Response to the extended European search report”), the applicant must respond to the written opinion, otherwise the application will be deemed withdrawn.  Rule 70a, states:

(1)       In the opinion accompanying the European search report the European Patent Office shall give the applicant the opportunity to comment on the extended European search report and, where appropriate, invite him to correct any deficiencies noted in the opinion accompanying the European search report and to amend the description, claims and drawings within the period referred to in Rule 70, paragraph 1.

(2)       In the case referred to in Rule 70, paragraph 2, or if a supplementary European search report is drawn up on a Euro-PCT-application, the European Patent Office shall give the applicant the opportunity to comment on the extended European search report and, where appropriate, invite him to correct any deficiencies noted in the opinion accompanying the European search report and to amend the description, claims and drawings within the period specified for indicating whether he wishes to proceed further with the application.

(3)       If the applicant neither complies with nor comments on an invitation in accordance with paragraph 1 or 2, the application shall be deemed to be withdrawn.”

Several of my European colleagues tell me that rule 70(a) will also be applied in situations the EPO has acted as the International Searching Authority (ISA) or the International Preliminary Examination Authority (IPEA) in PCT applications.  For PCT applications where the EPO is the search authority, the term for response will be set by the EPO.  According to many reputable European law firms, this term is likely to be two months.  Other sources indicate the term could be as short as one month.

In response to Rule 70(a), several sources now recommend that you avoid using the EPO as your ISA in your PCT applications to avoid this strict deadline.  It certainly seems that is the intended consequence of the new rule.  In recent years, the EPO has been swamped with PCT searches and it has affected their ability to respond to their domestic applications.  They have certainly indicated that they are looking for ways to respond to the massive influx of patent applications.  Limiting the number of PCT applications is one way of responding to their backlog.

If you are a U.S. applicant, should you stop using the EPO as a PCT search authority?  That is a good question without a clear answer.  The EPO has an excellent reputation.  Many lawyers believe that it is the best search authority in the world.  (However, other lawyers have begun to question this reputation after receiving questionable searches from the EPO during the last couple of years.)

Other search authorities available to U.S. applicants are: the USPTO, the Korean Patent Office, and the Australian Patent Office.  The USPTO outsources their PCT searches to outside contractors.  It is generally believed that the quality of such searches is somewhat mixed (to put it kindly).  Furthermore, a PCT written opinion from the USPTO is likely to be issued beyond the 30 month date.  So, a USPTO search will be worthless in helping your clients decide whether to go into the national stage phase.  I have not used the USPTO as an ISA for years.  However, we are hearing rumors about a few timely responses from the USPTO.  Could David Kappos actually have an impact?

In an effort to limit the number of applications they receive, the Australian Patent Office places strict limits on the technical subject matter that it will search.  So, the Australian Patent Office is often not a practical solution.  The Korean Patent Office is strong in certain technological areas, but not other areas.

So, as a U.S. applicant, your choices for a PCT search authority are not that great.  Personally, I would probably stick with the EPO as the ISA in most cases.  Of course, I would also be prepared to address any objections in the written opinion when I enter the European National Phase.  However, if you have a technology where you know the Korean Patent Office will likely issue a complete search, Rule 70(a) might persuade you to select the Korean Patent Office as your PCT search authority – especially in light of the relatively inexpensive Korean search fees.  If you are really daring, you might event try the USPTO.

Bill Naifeh is a patent attorney in Dallas, Texas.  He often works with clients on a part time “in-house”  basis to assist clients with the management of their patent portfolios.  More information may be found at www.naifeh.com.

At AIPLA’s annual meeting in Washington DC, I attended a presentation by Alison Brimelow.  Alison Brimelow is the current president of the European Patent Office (the “EPO”).

Hearing her speak was somewhat reminiscent of listening to Jon Dudas (former USPTO director).  At times, it appeared they were using the same play book.  They certainly were using the same justifications for changes that will make an effective patent protection more difficult.  One of the points she made is that things are certainly changing at the EPO.  Anyone who manages a patent portfolio with European applications should be aware of the upcoming changes.

Her discussion topics are really not new.  They have been discussed in one forum or another since at least 2005.  Our European associates have been warning us of many of these changes for quite some time.  However, U.S. practitioners seem to be notoriously slow at responding to rule changes from across the pond.

The changes are touted to be part of the EPO’s “raising the bar initiatives” which according to the EPO, are designed “to improve the quality of incoming patent applications and streamline the grant procedure.”  Some of the changes include:

1. Restricting the use of divisional applications;
2. Further restrictions on the use of multiple independent claims;
3. Mandatory response to the search opinion; and
4. A higher requirement for inventive step.

The first three items on the above list will be implemented by rule changes which will be effective on April 1, 2010.  The last item appears to be an attitude or internal policy shift designed to reduce “trivial or unjustified” patents.   It may be in the Guidelines For Examination which is set to be published in December.  In future posts, I will discuss these items and their impact on patent owners in greater detail.  However, many details are currently available on the websites of several European patent firms.

These changes once again emphasize the need for an active and updated international patent portfolio plan and early involvement of an European attorney in the patent process (if Europe is a priority region for the portfolio).

Although the situation in the U.S. is better now, I am still surprised by the number of U.S. patent lawyers who file foreign patents in much the same way they were taught 20 years ago.  In fact, the new rule restricting multiple independent seems to be in response to applicants who continue to U.S. style claims rather than to simply draft claims according to European conventions.  U.S. patent lawyers seem to be oblivious to the rules and the importance other countries. (Often, foreign filing is thought of as a paralegal function.)   With these new rules, more thought must be given to submitting filings in accordance with the conventions of other countries, and yes, that means submitting non-U.S. style claims.

Bill Naifeh (www.naifeh.com)