Friday, January 13, 2006

The Lemley/Moore discussions about continuation practice at the USPTO

Dennis Crouch wrote:

Have you thought any about Lemley and Moore's stats
on continuation practice?

It seems that many practitioners are up in arms about the PTO's proposed

I noted that I had included statistics for continuing applications for 2004 on page 18 of the Nov. 2005 issue of Intellectual Property Today.

I also wrote:

Of my thoughts on the Lemley Moore paper in the Boston University Law Review,

from 4 CHI.-KENT J. INTELL. PROP. 186 (2005):

Mark Lemley and Kimberly Moore, in footnote 22 of an
article in the Boston University Law Review, 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. This removal
included all continuing applications (continuations,
divisionals, continuations-in-part).

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 ], 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.

The error in footnote 22 is problematic, but the
failure of author Moore or the Boston University Law
Review to respond and to correct the error is
particularly troubling. In a different area, in the
context of the plagiarism issue involving Professor
Laurence Tribe of Harvard Law School, Professor Allan
Dershowitz suggested there was a “cultural difference”
between sourcing in the legal profession and other
academic disciplines. One would hope that there is
no cultural differnece between law and other academic
disciplines as to the correction of published text
which is indisputably wrong.

As a sidelight, one notes that, as a consequence of the investigation of Professor Hwang of Seoul National University [SNU], SNU is setting up an office of research integrity which will look into not only matters of fraud but also of plagiarism and ghost writing, issues that have been asserted against Professor Tribe.

Separately, about collateral estoppel on an assertion that Graver Tank was related to collateral estoppel -->

When I think of the estoppel effect of a prior determination of invalidity, I think of Blonder-Tongue Labs., Inc. v. University of Ill. Foundation, 402 U.S.
313 (1971).

The more familiar Graver Tank case, 339 U.S. 605, was limited to the question of infringement of the four valid flux claims and to the applicability of the doctrine of equivalents to findings of fact in this case. It did not involve invalidity or collateral estoppel.

The less familiar Graver Tank case, 336 U.S. 271, did involve invalidity. The district court had found invalidity of certain flux claims, which determination was reversed by the Seventh Circuit: The Court of Appeals considered that because there was nothing in the
record to show that the applicants for the patent intended by these claims to assert a monopoly broader than nine metallic silicates named in the specifications. The district court and the Supreme Court found that because the claim read on certain silicates, undislosed and inoperative, the claim was invalid. There is no mention of estoppel in the case, nor is an estoppel issue presented.

Lemley, in 16 Berkeley Tech. L.J. 1045,
talked about the absence of collateral estoppel barring a defendant from asserting invalidity of a patent previously held valid: Parklane Hosiery Co. v. Shore, 439 U.S. 322, 330 (1979) ("If a defendant
in the first action is sued for small or nominal damages, he may have little incentive to defend vigorously, particularly if future suits are not foreseeable.").

In a different vein,

There is a joke about those who say the market always knows the right price for an equity -- "efficient market" [EM] types. It goes something like this. Two EM guys are walking down the street and notice a green slip of paper that says "$20" and has a picture of Andrew Jackson on it. One considers picking it up but the other stops him, saying, "No, if that were really a $20, someone would have picked it up by now."

In the "97% patent grant rate" discussion, we have many legal professors (and now the writers of the eBay brief to the Supreme Court) who have been picking up a counterfeit $20 bill.


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