Wednesday, July 29, 2009

Kappos at the Senate on July 29

William New, at Intellectual Property Watch, wrote of David Kappos before the Senate:

But in the process, Kappos showed possible weaknesses in separating himself from his job at IBM and the need for international diplomacy on IP enforcement.

Of nuts and bolts issues at the USPTO:

Kappos said he has been asked by Commerce Secretary Gary Locke to “refashion the patent examination process.” He said he will “completely remake” the count system, which will help morale and to get to applications that matter. A key focus, he said, is the huge backlog in patent applications, and to “refashion the fee system” to make it more accurately associate fees with the work that is being done. He also would work on “fixing” fee diversion from USPTO.

Webcast of Kappos proceeding on 29 July 09

In a post Senators See Patent Office Nominee as Possible Ally, the Blog of LegalTimes noted:

Kappos, testifying before the Senate Judiciary Committee, said little today about the position the Patent and Trademark Office should take on legislation. Under questioning from Sen. Arlen Specter (D-Pa.), Kappos said his decisions would not be unduly influenced by his recent work as vice president and assistant general counsel for IBM Corp. His priority would be “doing the right thing for the American people,” Kappos said.

Specter, employing apparent sarcasm, replied to Kappos: “Doing that will satisfy everybody.”

IBM, and certain Senators, have been pushing for patent reform, including such things as "oppositions." The headline of the LegalTimes blog item is quite accurate.

See also

**Of the desire of Kappos to remake the count system at the USPTO-->

Background from Volpe-Koenig:

Each USPTO examiner is allocated a specific number of hours to spend during the prosecution of a patent application. Various performance parameters, such as the examiner's "percent of expectancy" and "percent allowed of disposals," are carefully monitored by supervisors on a biweekly basis to determine performance review results, promotions and bonuses.

Unlike in a law firm where attorneys bill for each hour worked, patent examiners work on a piecemeal basis whereby the examiner is credited only for the number of applications examined. An examiner earns two "counts" per patent application examined. A count is equivalent to half the amount of time that the examiner has to complete the examination of a patent application and "dispose" of it. The number of expected hours per disposal is dependent upon the examiner's experience level and the number of hours allocated to the art examined. The more experience that an examiner has, the fewer hours the examiner is allotted to dispose of an application.

An examiner earns a first "count" upon issuing a first report (office action) regarding the patentability of the patent application and a second "count" when the application is disposed of (allowed, abandoned, or when the examiner responds to an appeal). It is not unusual for an examiner to spend more than the time equivalent to one "count" to complete a first office action. The examiner does not receive extra credit for issuing a second non-final office action, a final office action, telephone interviews or an advisory action. The examiner is allowed to charge one hour of "other" time for each instance when a personal (in office) interview is held with an applicant and/or the applicant's representative.

An examiner earns two "easy counts" when the prosecution of an allowed patent application that has not yet issued is continued such that new references submitted by the applicant can be considered. This, of course, assumes that the references are not deemed relevant enough by the examiner to warrant the withdrawal of the allowance.

On gaming the count system, from patent docs:

According to Ms. Kepplinger, the ill-fated continuation and claims rules serve as a perfect example of the Patent Office's flawed logic, which blamed the backlog on applicants' filing of increasing numbers of continuation applications. Citing a study conducted at the George Mason University School of Law (see "Improving Patent Examination Efficiency and Quality: An Operations Research Analysis of the USPTO, Using Queuing Theory"), Ms. Kepplinger noted that contrary to the Office's hypothesis, the backlog has been caused by the issuance of too many non-final Office actions. In particular, the George Mason study found that divisional and continuation filings have remained fairly stable over the past seven years, while RCEs have increased from 8.3% to 19.6% of total filings. Ms. Kepplinger argued that this actually indicates that some examiners have been "gaming the count system."

IPBiz notes that once one recognizes that RCEs are the most predominant form of continuing application, one sees that the
analysis by Lemley and Moore in "Ending Abuse..." [BULR] is completely wrong. In turn, the USPTO cited, and relied upon, "Ending Abuse..." in justifying its proposal on rules on continuation applications.

Kappos may have a good idea in suggesting changes to the count system, but if relies upon the false logic of Lemley and Moore, he may create a bigger problem.


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