Sunday, November 23, 2014

Patent "Quality", again

Within the law review article by Liang, 11 J. Marshall Rev. Intell. Prop. L. 477:

There is some dispute, however, over the extent to which allowance rates actually reflect patent quality, or more fundamentally what the "allowance rate" actually represents and how it is calculated. n217 At the PTO, many patent applications are continuations, divisionals, or represent continued examinations of [*512] other applications. n218 Some rejected applications are appealed and rejections may be overturned. n219 Thus, the allowance rate may not really represent the percentage of applications that are eventually granted. n220 But if consistently calculated across patent offices and accounting for external factors, allowance rates should help provide an approximate comparison of patent quality across patent offices and over time.

with references:

n217 Malackowski & Barney, supra note 106; Joff Wild, Patent Quality and the Plummeting USPTO Approval Rate, INTELL. ASSET MGMT. (Mar. 6, 2008), (last visited Apr. 16, 2012).

n218 Cecil D. Quillen, Jr. & Ogden H. Webster, Continuing Patent Applications and Performance of the U.S. Patent and Trademark Office--One More Time, 18 FED. CIR. B.J. 379 (2009).

n219 37 C.F.R. ยง 41.31 (Nov. 22, 2011 through April 4, 2012).

n220 Cecil D. Quillen et al., Continuing Patent Applications and Performance of the U.S. Patent and Trademark Office--Extended, 12 FED. CIR. B.J. 35 (2002).

with n106: James Malackowski & Jonathan Barney, What is Patent Quality? A Merchant Banc's Perspective, 43 LES NOUVELLES 123, 123-24 (2008).

See also LBE, On Patent Quality and Patent Reform , 88 J. Pat. & Trademark Off. Soc'y 1068 (2006) , with the text

In the brief of petitioners eBay and to the Supreme Court in January 2006, a 2001 paper of Cecil Quillen (and Ogden Webster) was cited for "estimating the rate of patent approvals by the PTO to be 97%." n12 Separately, the brief of Yahoo in the eBay case n13 cited the same Quillen/Webster paper for the proposition: "The PTO approves between 85 to 97 percent of the applications it receives." The Yahoo brief also stated: "As an initial matter, far too many low quality patents issue, as the district court in this case noted." n14 Other papers had cited the Quillen paper for the proposition of a 97% patent grant rate. n15 In fact, Quillen and Webster wrote in 2001: "The Grant Rate for the PTO in fiscal years 1993-1998, corrected for continuing applications, ranges from 80% to 97%, depending on the extent to which prosecution of abandoned applications was prolonged in continuing applications." The 2001 paper of Quillen and Webster stated that the grant rate was within a range, and never explicitly asserted that the grant rate [*1071] was 97%. n16 Nevertheless, the 97% number persists in the legal literature, along with the perception that the examination process at the United States Patent Office [USPTO] lacks quality.

See also LBE, Comment on "Patent Grant Rates at the United States Patent and Trademark Office" , 4 Chi.-Kent J. Intell. Prop. 186 (2005), with text

we suggest that Quillen and Webster's elevated grant rates arise from a flawed numerical approach.

AND, relevant to continuing applications,

Mark Lemley and Kimberly Moore, in footnote 22 of an article in the Boston University Law Review, n17 asserted that Clarke was guilty of "erroneously assuming that every continuation resulted in a patent and concluding that the grant rate was 75%." Because of this assertion, Lemley and Moore concluded "The 85% number provided in the revised Quillen et al. study is based on actual data about the applications that issue based on continuations, and reflects the best estimate we have of how often applications mature into patents."

As pointed out earlier, Clarke made no assumption anywhere in his paper that "every continuation resulted in a patent" and, as such, the footnote is incorrect and not properly cite-checked.

Subsequently, it has been suggested that the footnote intended to state "erroneously assuming every allowed continuation resulted in a patent." This suggestion may be criticized on several grounds.

First, Clarke did not "assume" every allowed continuation resulted in a patent. To eliminate the effects of continuing application practice on the patent grant rate, he identified issued patents claiming priority to an earlier issued patent and he removed them from consideration. n18 This removal included all continuing applications (continuations, divisionals, continuations-in-part).

[*195] Second, Clarke did not remove from consideration allowed continuations that did not claim priority to an issued patent and Clarke did not remove from consideration allowed continuations which did not give rise to a patent.

Third, in working with data on issued patents to identify the number of patents based on continuing applications, Clarke merely did a more thorough job of what was attempted in the QWII. As stated in footnote 22 of Lemley and Moore: "The 85% number provided in the revised Quillen et al. study is based on actual data about the applications that ISSUE based on continuations," [emphasis added n19], QWII made their correction based on data on ISSUED applications, not on ALLOWED applications. If the use of data on ISSUED applications means an assumption that every allowed continuation resulted in a patent, then it is an assumption made by both Quillen/Webster and Clarke. Because it is assumed by both, this assumption is not a basis to select the results of Quillen/Webster over those of Clarke.

Thus, footnote 22, as written, is incorrect, and even as favorably modified is irrelevant to distinguishing the results of Quillen/Webster from those of Clarke.


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