| Recent Notices of Rulemaking |
Referenced Items (173, 174, 175, 176) |
(175) DEPARTMENT OF COMMERCE
Patent and Trademark Office
37 CFR Part 1
[Docket No. PTO-P-2006-0004]
RIN 0651-AC00
Examination of Patent Applications That Include
Claims Containing Alternative Language
AGENCY: United States Patent and Trademark Office, Commerce.
ACTION: Proposed rule; request for comment on initial regulatory
flexibility analysis.
SUMMARY: The United States Patent and Trademark Office (Office) published a
notice proposing to revise the rules of practice pertaining to any claim
using alternative language to claim two or more independent and distinct
inventions (Alternative Claims Notice of Proposed Rule Making). The Office
has prepared an initial regulatory flexibility analysis (IRFA) on this
proposed change to the rules of practice. This notice publishes the IRFA
and requests public comment on the IRFA. This notice also invites public
comment on the Alternative Claims Notice of Proposed Rule Making.
DATES: Written comments on the IRFA or Alternative Claims Notice of
Proposed Rule Making must be received on or before April 9, 2008. No
public hearing will be held.
ADDRESSES: Comments should be sent by electronic mail message over the
Internet. Comments on the IRFA should be addressed to
markush-irfa.comments@uspto.gov, and comments on the proposed rule changes
in the Alternative Claims Notice of Proposed Rule Making should be
addressed to markush.comments@uspto.gov. Comments may also be submitted by
mail addressed to: Mail Stop Comments--Patents, Commissioner for Patents,
P.O. Box 1450, Alexandria, VA 22313-1450, or by facsimile to
(571) 273-7754, marked to the attention of Kathleen Kahler Fonda, Legal
Advisor, Office of Patent Legal Administration. Although comments may be
submitted by mail or facsimile, the Office prefers to receive comments via
the Internet.
Comments may also be sent by electronic mail message over the Internet
via the Federal eRulemaking Portal. See the Federal eRulemaking Portal Web
site (http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=
leavingFR.html&log=linklog&to=http://www.regulations.gov) for additional
instructions on providing comments via the Federal eRulemaking Portal.
The comments will be available for public inspection at the Office of
the Commissioner for Patents, located in Madison East, Tenth Floor, 600
Dulany Street, Alexandria, Virginia, and will be available on the Office's
Internet Web site at (http://frwebgate.access.gpo.gov/cgi-bin/
leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.uspto.gov).
Because comments will be made available for public inspection, information
that the submitter does not desire to make public, such as an address or
phone number, should not be included in the comments.
FOR FURTHER INFORMATION CONTACT: Kathleen Kahler Fonda, Legal Advisor,
Office of the Deputy Commissioner for Patent Examination Policy, by
telephone at (571) 272-7754; by mail addressed to: Box Comments
Patents, Commissioner for Patents, P.O. Box 1450, Alexandria, VA
22313-1450; or by facsimile to (571) 273-7754, marked to the attention of
Kathleen Kahler Fonda.
SUPPLEMENTARY INFORMATION: The Office published the Alternative Claims
Notice of Proposed Rule Making in the Federal Register in August of 2007.
See Examination of Patent Applications That Include Claims Containing
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Alternative Language, 72 FR 44992 (Aug. 10, 2007), republished at 1322 Off.
Gaz. Pat. Office 22 (Sept. 4, 2007). This notice supplements the
Alternative Claims Notice of Proposed Rule Making. The Alternative Claims
Notice of Proposed Rule Making indicated that the changes being proposed
involve rules of agency practice and procedure for which prior notice and
an opportunity for public comment are not required pursuant to 5 U.S.C. 553
(or any other law), and thus neither a regulatory flexibility analysis nor
a certification under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.)
is required under 5 U.S.C. 603. See Examination of Patent Applications That
Include Claims Containing Alternative Language, 72 FR at 44999.
The Office received several comments concerning the impact of the
proposed rules on small businesses and independent inventors. The Office
continues to believe that a regulatory flexibility analysis is not required
for the Alternative Claims Notice of Proposed Rule Making. The Office,
however, has decided to subject the proposed rules to a regulatory
flexibility analysis to provide a further opportunity for comment on the
small business impact of the proposed rules. Specifically, the Office has
commissioned a detailed analysis of the impact of the proposed rules on
small entities, and has prepared an IRFA. This notice publishes and
requests public comment on the IRFA.
The Alternative Claims Notice of Proposed Rule Making indicated that
comments on the proposed changes to the rules of practice were to have been
submitted by October 9, 2007. This notice also provides another opportunity
to submit comments on the changes to the rules of practice proposed in the
Alternative Claims Notice of Proposed Rule
Making.
1. Description of the reasons that action by the agency is being
considered: The Office is proposing to revise the rules of practice
pertaining to any claim using alternative language because patent
applicants sometimes use Markush or other alternative formats to claim two
or more independent and distinct inventions and/or to recite hundreds, if
not thousands, of alternative embodiments in one claim. Such claims are
confusing, difficult to understand, and frequently border on being
unmanageable. Proper search of such complex claims, particularly those
using Markush language, often consume a disproportionate amount of Office
resources as compared to other types of claims. The prosecution of these
complex claims likewise often requires separate examination and
patentability determinations for each of the alternatives within the claim,
e.g., if the alternatives raise separate prior art, enablement, or utility
issues. Furthermore, the variety and frequency of alternatives recited in
claims filed in applications pending before the Office, driven in part by
trends in emerging technologies, have exacerbated problems with pendency.
See Examination of Patent Applications That Include Claims Containing
Alternative Language, 72 FR at 44992-97.
2. Succinct statement of the objectives of, and legal basis for, the
proposed rules: The objective of the proposed changes is to improve
practices pertaining to claims that recite alternatives in a manner that
will enhance the Office's ability to grant quality patents that effectively
promote innovation in a timely manner. See Examination of Patent
Applications That Include Claims Containing Alternative Language, 72 FR at
44992. The authority for the proposed changes is 35 U.S.C. 2(b)(2)(A) and
(C) (authorizes the establishment of regulations to govern the conduct of
proceedings in the Office and facilitate and expedite the processing of
patent applications), 112 (requires applicants to submit one or more claims
particularly pointing out and distinctly claiming the subject matter which
the applicant regards as his invention), 121 (authorizes the Office to
restrict an application to a single invention when two or more independent
and distinct inventions are claimed), and 131 (authorizes the Office to
cause an examination to be made of an application). See In re Harnisch, 631
F.2d 716, 722 n.6, 206 USPQ 300, 306 n.6 (CCPA 1980) (inviting the Office
to exercise its rule making powers to forestall procedural problems arising
from Markush claims).
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3. Description and estimate of the number of affected small entities:
The Small Business Administration (SBA) small business size standards
applicable to most analyses conducted to comply with the Regulatory
Flexibility Act are set forth in 13 CFR 121.201. These regulations
generally define small businesses as those with fewer than a maximum number
of employees or less than a specified level of annual receipts for the
entity's industrial sector or North American Industry Classification System
(NAICS) code. The Office, however, has formally adopted an alternate size
standard as the size standard for the purpose of conducting an analysis or
making a certification under the Regulatory Flexibility Act for
patent-related regulations. See Business Size Standard for Purposes of
United States Patent and Trademark Office Regulatory Flexibility Analysis
for Patent-Related Regulations, 71 FR 67109 (Nov. 20, 2006).
This alternate small business size standard is the previously
established size standard that identifies the criteria entities must meet
to be entitled to pay reduced patent fees. See 13 CFR 121.802. If patent
applicants identify themselves on the patent application as qualifying for
reduced patent fees, the Office captures this data in the Patent
Application Location and Monitoring (PALM) database system, which tracks
information on each patent application submitted to the Office.
Unlike the SBA small business size standards set forth in 13 CFR
121.201, this size standard is not industry-specific. Specifically, the
Office's definition of small business concern for Regulatory Flexibility
Act purposes is a business or other concern that: (1) Meets the SBA's
definition of a "business concern or concern" set forth in 13 CFR 121.105;
and (2) meets the size standards set forth in 13 CFR 121.802 for the
purpose of paying reduced patent fees, namely an entity: (a) Whose number
of employees, including affiliates, does not exceed 500 persons; and (b)
which has not assigned, granted, conveyed, or licensed (and is under no
obligation to do so) any rights in the invention to any person who made it
and could not be classified as an independent inventor, or to any concern
which would not qualify as a non-profit organization or a small business
concern under this definition. See Business Size Standard for Purposes of
United States Patent and Trademark Office Regulatory Flexibility Analysis
for Patent-Related Regulations, 71 FR at 67112.
The proposed rule will apply to any such small entity who files a patent
application and chooses to use alternative language in claiming his or her
invention. To estimate the number of applications containing alternative
language that are submitted by small entities, Office staff analyzed
applications filed in fiscal year 2005 (FY05) (the most recent year for
which complete eighteen-month publication data are available). Using the
preceding definition of small entity, the Office screened these published
applications for commonly used alternative language (e.g., "contains one
selected from the group consisting of") and identified 20,824 small entity
applications as containing alternative language and, therefore, as
potentially affected by the proposed rule. The Office estimates that this
represents approximately 31 percent of total applications containing
alternative language.
As anticipated, a larger proportion of applications containing
alternative language is concentrated in the biotechnology/chemical arts
(an estimated 9,186 of the 21,187 small entity applications in the
biotechnology/chemical arts or 43.4 percent). The remaining applications
with alternative language are distributed throughout the electrical and
mechanical arts (an estimated 11,638 of the 73,831 small entity
applications in the electrical/mechanical arts or 15.8 percent). These
results are summarized in Table 1.
Table 1. - Small Entity Applications (FY05)
Number of
small
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entity
applications
Number of containing
small entity alternative
Type of art applications language Percent
Biotechnology/Chemical Applications 21,187 9,186 43.4
Electrical/Mechanical Applications 73,831 11,638 15.8
Total Applications 95,018 20,824 21.9
4. Description of the projected reporting, recordkeeping and other
compliance requirements of the proposed rules, including an estimate of the
classes of small entities which will be subject to the requirement and the
type of professional skills necessary for preparation of the report or
record: The proposed rule could potentially impact applicants in two ways.
First, it would require that a claim must be limited to a single invention.
Consequently, if a submitted application contains a single claim that
defines multiple independent and distinct inventions, then the examiner may
apply a restriction requirement. See Examination of Patent Applications
That Include Claims Containing Alternative Language, 72 FR at 44995. In
this case of an intra-claim restriction, applicants who wish to pursue
patent protection for the full scope covered by their initial application
would have to file a divisional application for each additional invention
defined in that original claim. For example, if a single claim contains
three independent and distinct inventions and the Office requires
restriction, the applicant could file two divisional applications to
prosecute the full scope of the original claims. Alternatively, the
applicant could elect not to file any divisional applications, in which
case he or she would be limited to the one invention elected in the initial
application.
To estimate the costs of one divisional application, the Office is using
unit cost data from the American Intellectual Property Law Association
(AIPLA) Report of the Economic Survey \2\ and the Office fee schedule for
fiscal year 2007. Based on these data, the Office estimates that the cost
of filing one divisional application is $10,258 (expressed in present value
terms using a 7 percent discount rate). The cost faced by applicants could
be greater than this amount if the applicant files more than one
divisional.
\2\ AIPLA Report of the Economic Survey 2007. Table Q33g, Third
Quartile, "Patent application amendment/argument, relatively complex,
biotechnology/chemical (Preparation and Filing)." Page I-74; Table Q33l,
Third Quartile, "Issuing an allowed application (all post-allowance
activity)." Page I-81; Table Q33n, Third Quartile, "Pay a Maintenance Fee."
Page I-76.
Second, the proposed rule allows examiners to require applicants to
simplify the presentation of claims with alternative language so that:
(1) The number and presentation of alternatives in a single claim are
not difficult to construe.
(2) No alternative is itself defined as a set of further alternatives
within the claim.
(3) No alternative is encompassed by any other alternative within a list
of alternatives unless there is no other practical way to define the
invention.
(4) All alternatives are substitutable for each other.
See Examination of Patent Applications That Include Claims Containing
Alternative Language, 72 FR at 44996.
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Consequently, if an examiner determines that a claim does not comply
with one or more of the format requirements listed above, the applicant can
be required to correct the claim. The applicant would provide this
correction to the claim by submitting an amendment to the application.
To estimate the cost of amending an application in order to correct the
format of the claim(s), the Office is using unit cost data on amendments
from the AIPLA Report of the Economic Survey. \3\ Based on the AIPLA data,
the Office estimates that the cost of filing one amendment to correct the
format of the claim(s) is $4,029 (expressed in present value terms using a
7 percent discount rate). The cost faced by applicants could be less than
or greater than this amount, depending on how difficult it is to correct
the format of the claim(s).
\3\ AIPLA Report of the Economic Survey 2007. Table Q33g, Third
Quartile, "Patent application amendment/argument, relatively complex,
biotechnology/chemical (Preparation and Filing)." Page I-74.
Any particular application containing alternative language could be
impacted by either, both, or neither of these two effects, and would fall
into one of the following four categories:
(1) Applications with alternative language that do not claim multiple
inventions in a single claim and have claim(s) in a proper format.
(2) Applications with alternative language that claim multiple
inventions in a single claim and have claim(s) in a proper format.
(3) Applications with alternative language that do not claim multiple
inventions in a single claim but have claim(s) in an improper format.
(4) Applications with alternative language that claim multiple
inventions in a single claim and have claim(s) in an improper format.
Applications within the first of these categories have "acceptable"
alternative language, and small entities submitting such applications would
not incur any incremental costs of note. The remaining three categories,
however, contain applications that generally would lead to incremental
costs. Applications in category 4, which require both a divisional
application and an amendment, incur the greatest cost ($14,287). Table 2
summarizes the compliance activities and corresponding cost estimates.
Table 2. - Incremental Cost Estimates
Cost
(present
Compliance activity value)
Category 1 applications containing acceptable alternative language n.a.
Category 2 applications needing one divisional application $10,258
Category 3 applications needing one amendment to correct the format 4,029
of the claim(s)
Category 4 applications needing one divisional application and one 14,287
amendment to correct the format of the claim(s)
To estimate the number of small entity applications in each category,
the Office examined a sample of 102 FY05 small entity applications with
alternative language from the biotechnology/chemical arts and 57 FY05 small
entity applications with alternative language from the electrical/
mechanical arts. For these applications, the Office identified and
categorized the impact of the proposed rule. The Office then scaled these
findings to the overall number of small entity applications.
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Using this methodology, the Office estimates that 82 percent of affected
small entity applications in the biotechnology/chemical arts and 98 percent
of affected small entity applications in the electrical/mechanical arts
would fall into category 1 and would not incur any notable incremental
costs associated with the rule. The remaining 18 percent of affected small
entity applications in the biotechnology/chemical arts and 2 percent of
affected small entity applications in the electrical/mechanical arts would
incur costs to comply with the proposed rule requirements. In total, the
analysis shows that an estimated 1,825 small entity applications would
incur compliance costs under the proposed rule. Table 3 summarizes these
results.
Table 3. - Small Entity Applications Containing
Alternative Language by Cost Impact Category
Biotechnology/ Electrical/
chemical mechanical
applications applications
FY05 FY05 Total
Number Percent Number Percent Number Percent
Category 1: Small entity
applications with acceptable
alternative language 7,565 82 11,434 98 18,999 91
Category 2: Small entity
applications with alternative
language that claim multiple
inventions in a single claim 991 11 204 2 1,195 6
Category 3: Small entity
applications with alternative
language that have claim(s)
in an improper format 270 3 0 0 270 1
Category 4: Small entity
applications with alternative
language that claim multiple
inventions in a single claim
and have claim(s) in an
improper format 360 4 0 0 360 2
Total Small Entity Applications
with Alternative Language
(Categories 1-4) 9,186 100 11,638 100 20,824 100
Total Small Entity Applications
with a Cost Impact
(Categories 2-4) 1,621 18 204 2 1,825 9
In the Office's analysis of these applications, the number of claims in
an improper format ranged from one to four claims per application. Some
applications had only dependent claims that were in an improper format,
while others had only independent claims that were in an improper format.
One application had independent and dependent claims in an improper format.
Although the incremental cost faced by applicants could vary depending on
the complexity and number of claims needing correction, the Office's use of
AIPLA's 75th percentile unit cost estimate for an amendment already
accounts for some variation in costs (i.e., the 75th percentile may be a
high estimate for most applications) and would seem to be a conservative
figure.
In the Office's analysis of the sampled applications containing two or
more independent and distinct inventions that are claimed in the
alternative in a single claim, the median number of divisional
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applications required to maintain the scope of the application was 5,
although some applications would have required more than 100 divisional
applications to maintain scope.
The wide variation in the estimated number of divisional applications is
informative when considering the cost impact of the proposed rule for small
entity applicants. However, the Office believes that an applicant would
need to file at most approximately seven divisional applications following
an examiner's restriction requirement, even if more were needed to seek
patent protection for the full scope of the originally claimed inventions.
\4\ Therefore, while the cost impact of intra-claim restrictions could be
as low as zero for applicants that elect not to maintain scope, it could
range as high as the cost of seven divisional applications (present value
of approximately $42,000). However, the Office believes these applications
are relatively few in number and the impact for most applicants will be far
less.
\4\ Applicants may file divisional applications sequentially to keep a
case pending for the lifetime of a patent (twenty years) to take advantage
of the time to determine whether any of their inventions turn out to have
market value. The least-cost method of achieving this result would involve
an applicant pursuing one divisional application at a time over a
twenty-year period. Assuming the prosecution of each divisional application
lasts three years, an applicant would be able to minimize the total cost by
filing approximately seven divisional applications during this period.
5. Description of any significant alternatives to the proposed rules
which accomplish the stated objectives of applicable statutes and which
minimize any significant economic impact of the proposed rules on small
entities: The Office has considered a number of alternatives; however, none
of these alternatives would accomplish the stated objectives of applicable
statutes with a lesser economic impact on small entities.
(1) Hiring more examiners: This alternative would increase the number of
examiners available to review patent applications in general, thereby
improving pendency. It would not lead to impacts on small entities.
However, this alternative also would not make it any easier to review
applications containing problematic alternative language. The Office is
currently hiring as many examiners as resources permit. The Office's
ability to hire qualified new examiners is affected by many components,
such as budget, the economy, the availability of scientists and engineers,
and the ability to absorb and train new employees. Thus, the Office already
is employing this "alternative" to the extent that its resources permit,
but relying upon this alternative "alternative" alone without taking
additional steps would frustrate the Office's ability to grant quality
patents in a timely manner that effectively promote innovation.
(2) Charging additional fees for applications containing claims using
alternative language: This option could reduce the number of affected small
entities by creating a financial disincentive to submitting applications
containing claims using alternative language. However, the Office's past
efforts to seek patent fee adjustments does not lead to an expectation that
the Office would be successful in obtaining a patent fee adjustment that
would in fact recover the Office's actual cost of examining applications
containing claims using alternative language. In addition, any patent fee
adjustment for applications containing claims using alternative language
that was sufficient to recover the Office's actual cost of examining
applications would likely have a greater economic impact on a larger number
of small entities than the proposed rule changes. Finally, for applicants
that chose to submit alternative language despite the requirement to pay
additional fees, this alternative would not improve the patent prosecution
process or result in higher quality patents.
(3) Limiting the number of species that may be presented in an
application: The rules of practice currently provide that if an
"application contains claims directed to more than a reasonable number of
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species, the examiner may require restriction of the claims to not more
than a reasonable number of species before taking further action in the
application." See 37 CFR 1.146. A rule that set out a per se limit on the
number of species that may be claimed in an application would not
accomplish the objective of the proposed rules of treating applications
with two or more independent and distinct inventions presented in a single
claim. Furthermore, the potential change in the scope of protection
available via a single patent application likely would have a greater
economic impact on larger number of small entities than the proposed rule
changes.
(4) Exempting small entities (or take no action): While exempting small
entities from coverage of the proposed rules or any part thereof (or taking
no action) would avoid any incremental economic impact on small entities,
such exemption (or lack of action) would frustrate the Office's ability to
grant quality patents in a timely manner that effectively promote
innovation. It also would result in small entity applications (or, in the
case of no action, all applications) with two or more independent and
distinct inventions presented in single claim that either: (1) Consume a
disproportionate share of Office examination resources per application and
thus not effectively promoting innovation in a timely manner; or (2)
receive a less thorough examination, which would decrease, rather than
enhance, the Office's ability to grant quality patents. Finally, given the
Office's estimate (as previously noted) that close to one third of all
patent applications containing alternative language are submitted by small
entities, this alternative would greatly diminish the rule making's ability
to improve the patent prosecution process and result in higher quality
patents.
6. Identification, to the extent practicable, of all relevant Federal
rules which may duplicate, overlap or conflict with the proposed rules: The
Office is the sole U.S. government agency responsible for administering the
provisions of title 35, United States Code, pertaining to examination and
granting patents. Therefore, no other federal, state, or local entity
shares jurisdiction over the examination and granting patents.
Other countries, however, have their own patent laws, and an entity
desiring a patent in a particular country must make an application for
patent in that country, in accordance with the applicable law. Although
the potential for overlap exists internationally, this cannot be avoided
except by treaty (such as the Paris Convention for the Protection of
Industrial Property, or the Patent Cooperation Treaty (PCT)).
Nevertheless, the Office believes that there are no other duplicative or
overlapping rules.
7. Request for data and information in support of the Final Regulatory
Flexibility Analysis: The Office welcomes comments addressing the economic
impact on small entities of any or all provisions of the proposed rule. In
particular, however, the Office is soliciting information on the following:
1. Alternative approaches that would reduce the burden of the rule for
small entities while meeting the Office's objectives.
2. The costs of modifying an application that already is under review as
needed to comply with the rule:
a. The cost of filing one or more divisional applications.
b. The cost of correcting a claim that is in an improper format, and
factors that might cause this cost to vary.
3. The number of patent applications submitted by unique small entities
per year (or per decade).
4. Factors that influence an applicant's decision to file divisional
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applications.
5. Issues that might affect the combined impact of alternative language
that requires intra-claim restriction and is of an improper format.
6. The extent to which applicants will adjust to the new rules over
time, such that future initial patent applications containing alternative
language will comply with the proposed rule (i.e., the applications will
not need to incur the cost of amendments or divisional applications due to
alternative language that is of an improper format or requires intra-claim
restriction).
7. The benefits of the rule making.
8. Other information related to this Initial Regulatory Flexibility
Analysis, including any assumptions or findings stated above.
March 5, 2008 JOHN DOLL
Commissioner for Patents
[1329 OG 41]