[Federal Register Volume 85, Number 149 (Monday, August 3, 2020)]
[Rules and Regulations]
[Pages 46932-46993]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-16559]
[[Page 46931]]
Vol. 85
Monday,
No. 149
August 3, 2020
Part III
Department of Commerce
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Patent and Trademark Office
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37 CFR Parts 1, 11, 41, et al.
Setting and Adjusting Patent Fees During Fiscal Year 2020; Final Rule
Federal Register / Vol. 85, No. 149 / Monday, August 3, 2020 / Rules
and Regulations
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DEPARTMENT OF COMMERCE
Patent and Trademark Office
37 CFR Parts 1, 11, 41, and 42
[Docket No. PTO-P-2018-0031]
RIN 0651-AD31
Setting and Adjusting Patent Fees During Fiscal Year 2020
AGENCY: United States Patent and Trademark Office, Department of
Commerce.
ACTION: Final rule.
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SUMMARY: The United States Patent and Trademark Office (Office or
USPTO) sets or adjusts patent fees as authorized by the Leahy-Smith
America Invents Act (Act or AIA), as amended by the Study of
Underrepresented Classes Chasing Engineering and Science Success Act of
2018 (SUCCESS Act). The USPTO is a business-like operation where the
demand for patent products and services and the cost of operations are
affected by external factors, such as the economy, legislation, court
decisions, and increases in the costs of supplies and contract
services, as well as internal factors, such as changes in patent
examination processes and procedures. The fee adjustments are needed to
provide the Office with a sufficient amount of aggregate revenue to
recover the aggregate cost of patent operations in future years (based
on assumptions and estimates found in the FY 2021 Congressional
Justification (FY 2021 Budget)) and to allow the Office to continue
progress toward achieving its strategic goals.
DATES: This rule is effective on October 2, 2020, except for the
amendment to Sec. 1.16(u) in amendatory instruction 2i, which is
effective on January 1, 2022. The changes to Sec. 1.18(b)(1) shall
apply to those international design applications under the Hague
Agreement having a date of international registration on or after
October 2, 2020.
FOR FURTHER INFORMATION CONTACT: Brendan Hourigan, Director of the
Office of Planning and Budget, by telephone at (571) 272-8966; or
Dianne Buie, Director, Forecasting and Analysis Division, by telephone
at (571) 272-6301.
SUPPLEMENTARY INFORMATION:
I. Executive Summary
A. Purpose of This Action
The Office issues this Final Rule under section 10 of the AIA
(section 10), Public Law 112-29, 125 Stat. 284, as amended by Public
Law 115-273, 132 Stat. 4158 (the SUCCESS Act), which authorizes the
director of the USPTO to set or adjust by rule any patent fee
established, authorized, or charged under title 35 of the United States
Code (U.S.C.) for any services performed, or materials furnished, by
the Office. Section 10 prescribes that fees may be set or adjusted only
to recover the aggregate estimated costs to the Office for processing,
activities, services, and materials relating to patents, including
administrative costs of the Office with respect to such patent fees.
Section 10 authority includes flexibility to set individual fees in a
way that furthers key policy factors, while taking into account the
cost of the respective services. Section 10 also establishes certain
procedural requirements for setting or adjusting fee regulations, such
as public hearings and input from the Patent Public Advisory Committee
(PPAC) and congressional oversight. The revenue and workload
assumptions in this Final Rule are based on the assumptions and
estimates found in the FY 2021 Budget. However, projections of
aggregate revenues and costs are based on point-in-time estimates, and
are subject to change. Notably, since the FY 2021 Budget was published,
fee collections have been lower than anticipated, due, in part, to
fewer application filings resulting from the COVID-19 outbreak.
Although economic circumstances have changed substantially since
the FY 2021 Budget was developed, the USPTO determined it remains the
most appropriate starting point for developing this Final Rule. First,
the USPTO's projections of aggregate revenues and costs are necessarily
estimates that can change substantially from one point in time to the
next due to numerous factors outside the USPTO's control, including
cyclical economic changes or exogenous shocks, such as COVID-19,
changes in the laws governing USPTO revenues or expenditures, and other
events. Nevertheless, the USPTO has historically used its most recent
budget assumptions when setting fees, because they are the most recent
complete evaluation of the USPTO's budget expectations and
requirements, and provide assumptions for stakeholders to use when
formulating their comments. Those projections were developed in late
calendar year 2019, prior to the COVID-19 outbreak, and assumed
continuing stable economic growth, not the sharp economic downturn and
rebound of 2020.
The FY 2021 Budget was developed based on the assumptions that real
GDP would grow around 2.2 percent in FY 2020 and 1.9 percent in FY
2021. The USPTO appreciates that revenue estimates based on those
assumptions may be higher than what will ultimately be collected.
The USPTO has considered the state of the U.S. economy, the
operational needs of the agency, and the comments and advice received
from the public during the 60-day comment period. The USPTO has made
adjustments to the timing of the Final Rule based on all of these
considerations, specifically delay publishing the Final Rule from April
with a July effective date to August with an October effective date.
This approach is consistent with the USPTO's many other efforts to
provide various types of relief to stakeholders, including deadline
extensions and fee postponements. Ultimately, the goal of the USPTO is
to ensure not only that businesses and entrepreneurs can weather the
economic downturn, but that they can hit the ground running as it
passes.
B. Summary of Provisions Impacted by This Action
Consistent with federal fee setting standards, the Office conducted
a biennial review of fees, costs, and revenues that began in 2017 and
concluded that fee adjustments are necessary to provide the resources
needed to improve patent operations, including implementing the USPTO
2018-2022 Strategic Plan (Strategic Plan). As a result, the 296 fees
set or adjusted in this rule align directly with the Office's strategic
goals and four key fee setting policy factors, discussed in detail in
Part III: Rulemaking Goals and Strategies.
The assumptions and estimates found in the FY 2021 Budget show that
the fee schedule in this rule will recover the aggregate estimated
costs of patent operations, including achieving the Office's strategic
goals as detailed in the Strategic Plan, available at: www.uspto.gov/strategicplan. The Strategic Plan defines the USPTO's mission, vision,
and long-term goals and presents the actions the Office will take to
realize those goals. This fee setting rule supports the patent-related
strategic goal to optimize patent quality and timeliness, which
includes optimizing patent application pendency and examination time
frames, issuing highly reliable patents, fostering innovation through
business effectiveness, and enhancing the operations of the Patent
Trial and Appeal Board (PTAB or Board). To the extent that the
aggregate revenue generated by this rule will be used to pay for all
patent-related costs
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of the USPTO, this rule also supports the USPTO's goal to provide
domestic and global leadership to improve intellectual property (IP)
policy protection and enforcement, as well as the mission support goal
to deliver organizational excellence, which includes optimizing the
speed, quality, and cost-effectiveness of IT delivery to achieve
business value and ensuring financial sustainability to facilitate
effective USPTO operations. Before issuing this Final Rule, the Office
considered and analyzed all comments, advice, and recommendations
received from the public during the 60-day comment period. The Office's
response to comments received is available in Part VI: Discussion of
Comments.
During a formal process closely tied to the annual budget process,
the USPTO reviewed and analyzed the overall balance between the
Office's estimated revenue and costs over the next five years (based on
the assumptions and estimates found in the FY 2021 Budget) and also
reviewed individual fee changes and new fee proposals to assess their
alignment with the Office's strategic goals and fee structure
philosophy, both of which aim to provide sufficient financial resources
to facilitate the effective administration of patent operations.
Specifically, the Office assessed how well each proposal aligned with
four key fee setting policy factors: Promote innovation strategies,
align fees with the full cost of products and services, set fees to
facilitate the effective administration of the patent system, and offer
processing options for applicants.
This Final Rule sets or adjusts 296 patent fees for large, small,
and micro entities (any reference herein to ``large entity'' includes
all entities other than those that have established entitlement to
either a small or micro entity fee discount). The fee rates for small
and micro entities are tiered, with small entities receiving a 50
percent discount on certain patent fees and micro entities receiving a
75 percent discount. Small entity fee eligibility is based on the size
or certain non-profit status of the applicant's business and that of
any other party holding rights to the invention. Micro entity fee
eligibility is described in section 10(g) of the AIA. The Office is
also introducing five new fees and discontinuing four fees.
Overall, the routine fees to obtain a patent (i.e., filing, search,
examination, and issue fees) will increase under this Final Rule,
relative to the current fee schedule, in order to ensure financial
sustainability and accommodate increases needed to improve the
predictability and reliability of patent IP protection. Applicants who
meet the definition for small or micro entity discounts will continue
to pay a reduced fee for the fees eligible for a discount under section
10(b) of the AIA. Additional information describing the fee adjustments
is included in Part V: Individual Fee Rationale in this rulemaking and
in the ``Table of Patent Fees: Current, Final Patent Fee Schedule, and
Unit Cost'' (hereinafter ``Table of Patent Fees'') available at https://www.uspto.gov/FeeSettingAndAdjusting.
As background, section 10 of the AIA changed the Office's fee
setting model and authorized the USPTO to set or adjust patent fees
within the regulatory process. Section 10 better equips the Office to
respond to changing circumstances. In Fiscal Year (FY) 2013 and FY
2018, the USPTO used the AIA's fee setting authority to achieve key fee
setting policy factors--to promote innovation strategies, align fees
with the full cost of products and services, set fees to facilitate the
effective administration of the patent system, and offer patent
processing options for applicants--and to generate sufficient resources
needed to meet the Office's strategic patent priorities. With the
additional fees collected as a result of the January 2013 Setting and
Adjusting Patent Fees Final Rule (hereinafter ``the January 2013 Final
Rule'') (78 FR 4212) and the January 2018 Setting and Adjusting Patent
Fees in Fiscal Year 2017 Final Rule (hereinafter ``the January 2018
Final Rule'') (82 FR 52780), the Office made considerable progress in
reducing the patent application backlog and pendency.
Since the development of the USPTO fee schedule currently in
effect, there have been changes to a number of the assumptions on which
the cost and revenue projections supporting that rulemaking were based.
Notably, since the January 2018 Final Rule was published, the USPTO's
projected patent examination costs have increased, and (b) fee
collections have been lower than anticipated due to a later than
planned implementation of the January 2018 Final Rule. The higher fees
set or adjusted in this rulemaking are needed as the Office continues
its efforts towards accomplishing its mission and responding to the
demands of both the domestic and international economies for robust and
timely IP products and services. The USPTO must continually reinforce
the predictability, reliability, and quality of those IP rights. Doing
so fosters the utmost confidence in the legal durability of the USPTO's
products and inspires greater innovation and further economic growth.
The Office's strategic goal to optimize patent quality and
timeliness recognizes the importance of innovation as the foundation of
American economic growth and national competitiveness. Through this
goal, the Office diligently works to balance timely examination with
improvements in patent quality, particularly the reliability of issued
patents. One of these improvements was a comprehensive analysis of
examination time, known as the examiner time analysis (ETA). The last
comprehensive review of examination time was completed over 40 years
ago. Since then, significant changes to the examination process have
occurred, including the emergence of new, more complex technologies, an
increase in available prior art that must be searched, the impact of
new electronic tools on the examination process, the challenges of
transitioning to a new patent classification system, and changes in the
legal landscape. As the USPTO plans for the future, the Office
considers how changes such as these impact the amount of time it takes
to examine an application.
The USPTO is also working towards improving patent quality by
providing increased clarity on patentable subject matter eligibility
under 35 U.S.C. 101. The Office continues to strive to create
consistency and increased clarity through this guidance. The Office is
also focusing efforts on improving the initial search and availability
of the best prior art to examiners. This aspect takes a variety of
forms, and the Office is working on many possible approaches. Overall,
presenting more comprehensive search results to the examiners initially
will lead to more efficient examination, a decrease in the information
gap between the examination phase and any potential later challenge or
litigation phases during the life of a patent, and an increase in the
reliability of the patent grant overall. Effecting the changes in the
examination process needed to ensure the issuance of reliable patents,
while also issuing those patents in a timely manner, means recognizing
a potential increase in the core operating costs for future years.
Another major component of the overall patent process is the work
carried out by the PTAB. On April 24, 2018, the U.S. Supreme Court
issued its decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348
(2018). Changes related to the SAS decision, along with the
implementation of other improvements, have increased the average cost
to conduct each proceeding. These changes are discussed in detail in
Part V: Individual Fee Rationale.
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In addition, as a production-oriented entity, the USPTO relies on
IT as a mission-critical enabler for every aspect of its operation. The
quality, efficiency, and productivity of patent operations correlate to
the performance of the USPTO's IT systems. To accomplish its
performance-based strategies, the USPTO continuously engages in multi-
year efforts to stabilize and upgrade its business systems and the IT
infrastructure supporting those systems in order to keep pace with
emerging business, legislative, and court needs and technology
standards. Since the last patent fee setting effort, the USPTO has made
significant progress on IT tools, including continued development and
implementation of the Patent End-to-End (PE2E) IT capability. For
example, the Office continues to work on releasing systems such as
Patent Center which will modernize the transaction systems by combining
EFS Web and Patent Application Information Retrieval (PAIR) in a single
interface. The Office has also made progress on the continued
development and deployment of the PTAB End-to-End (PTAB E2E) IT
capabilities, which will expand the use of intelligent data to support
appeal decisions and process inter partes review (IPR) proceedings,
post-grant review (PGR) proceedings, covered business method review
(CBM) proceedings, and derivation (DER) proceedings. Other IT efforts
are underway to stabilize, modernize, or replace the USPTO's legacy
systems and aging infrastructure. To this end, in FY 2019, the USPTO
performed an assessment of its IT systems, infrastructure, and
processes and began stabilizing and modernizing IT. One of the first
improvements was to move the critical Patent Application Location
Monitoring (PALM) system from an aging server to new servers that are
at least 10 times more reliable, 100 times faster, and use less than
half of the power consumed by the prior server.
The FY 2021 Budget does not anticipate that investments in IT
modernization and stabilization costs will increase beyond levels
previously foreseen. However, given the assumptions and estimates of
revenue and spending found in the FY 2021 Budget, this fee increase is
needed to support continuing IT investments at previously planned
levels. Without an increase in the USPTO's aggregate revenue, resources
available for IT investment will inevitably be curtailed.
Lastly, the USPTO has taken steps to establish and maintain
operating reserves to facilitate execution of multi-year plans. Using
fee setting authority and other tools, the USPTO continuously refines
its multi-year planning and budgeting. The fee setting authority
prescribed in the AIA, as amended by the SUCCESS Act, allows the Office
to effectively engage the stakeholder community on fee adjustments;
fully recover the aggregate costs of its planned operations, including
the development and maintenance of sufficient operating reserves;
invest in strategic agency initiatives; and respond to changing market
needs and other external factors.
Research has shown that large fee-funded, business-like agencies
without an operating reserve are at risk of cash flow stress. The
USPTO's operating reserves enable the Office to mitigate this risk. For
instance, in FY 2019, certain federal government departments and
agencies, including the Department of Commerce, shut down as a result
of a lapse in appropriations. The USPTO was able to remain open using
funds available from the operating reserves. This allowed the USPTO to
continue operations, thus preventing a significant degradation in
service levels, such as patent pendency time frames. This example
provides an ongoing, compelling case for the operating reserves'
significant value. Both external factors and internal decisions
impacting the spending and revenue projections mentioned above have
affected the Office's ability to grow the operating reserve to the
levels anticipated in the January 2018 Final Rule. The USPTO assesses
risk annually and determines the minimum level of reserves necessary to
shield core operations against known financial risks. The Office also
establishes optimal operating reserve targets, which are reviewed at
least biennially, based on an assessment of the likelihood and severity
of an array of risks. Based on the cost and revenue assumptions found
in the FY 2021 Budget, the USPTO's patent operating reserve is
projected to remain above the minimum level and gradually build toward
the optimal level, due to the impact of this Final Rule. Absent this
fee increase, the USPTO's patent operating reserve will fall below the
minimum level in FY 2021 and be exhausted by the end of FY 2022, which
will leave the Office vulnerable to changes in the economy that reduce
annual revenue, government-wide fiscal events, unexpected cost
increases, and a number of other financial risks.
The USPTO also acutely recognizes that fees cannot simply increase
for every improvement the Office deems desirable. The USPTO has a
responsibility to stakeholders to pursue strategic opportunities for
improvement in an efficient, cost-conscious manner. The Office's
financial advisory board (FAB) focuses on financial risk management and
determining what expenses are truly necessary. Each year the FAB
reviews multiple scenarios to determine what level of fee collections
are expected and what the hiring and spending levels should be in order
to effectively carry out the Office's mission. The FAB also regularly
reviews USPTO activities to identify opportunities for cost savings and
resources that can be redirected to higher-priority efforts. As a
result of the USPTO's careful financial management and prudent use of
fee setting authority, Congress recognized the Office as a good steward
of fee setting authority and extended that authority through the
SUCCESS Act.
In order to continue building on the progress made over the past
several years, and consistent with the USPTO's biennial fee review
policy, the final patent fee schedule detailed herein continues to
focus on the fundamental purpose of the USPTO, which is to foster
innovation, competitiveness, and job growth by recognizing and securing
IP rights through the delivery of high-quality and timely patent
examination and review proceedings in order to produce reliable and
predictable IP rights. This Final Rule seeks to provide the USPTO
sufficient financial resources to facilitate the effective
administration of the U.S. IP system. This Final Rule includes targeted
fee adjustments, and an approximately 5 percent across-the-board
adjustment to all patent fees that are not covered by the targeted
adjustments or that are discontinued. This Final Rule is needed because
critical costs to the Office continue to increase. Based on the
assumptions and estimates found in the FY 2021 Budget, the fees set
forth in this Final Rule will help replenish and grow the patent
operating reserve and maintain the USPTO's finances, enabling the
Office to deliver reliable and predictable service levels, even in
times of financial fluctuations. A more robust patent operating reserve
will also position the Office to identify and continue to undertake
capital improvements, such as adapting to an ever-increasing
technological future. The operating reserve will be managed carefully;
if the projected operating reserve were to exceed the targeted optimal
level by 10 percent for two consecutive years, it is USPTO policy to
examine the contributing factors and determine whether it would be
advisable to lower fee rates. The fees set or adjusted in this Final
Rule intend to position the Office well to deliver on
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known commitments and address unknown risks in the future.
C. Summary of Costs and Benefits of This Action
This Final Rule is economically significant and results in a need
for a Regulatory Impact Analysis (RIA) under Executive Order 12866
(Regulatory Planning and Review) (Sept. 30, 1993). The Office prepared
a RIA to analyze the costs and benefits of the Final Rule over a five-
year period, FY 2020-FY 2024. The RIA includes an analysis of four
alternatives and shows how well they aligned with the Office's
rulemaking strategies and goals, which include strategic priorities
(goals, objectives, and initiatives) from the Strategic Plan and the
Office's fee setting policy factors. From this conceptual framework,
the Office assessed the absolute and relative qualitative costs and
benefits of each alternative. Consistent with the Office of Management
and Budget (OMB) Circular A-4, ``Regulatory Analysis,'' this rule
involves a transfer payment from one group to another. The Office
recognizes that it is very difficult to precisely monetize and quantify
social costs and benefits resulting from deadweight loss of a transfer
rule such as this Final Rule. The costs and benefits that the Office
identifies and analyzes in the RIA are strictly qualitative.
Qualitative costs and benefits have effects that are difficult to
express in either dollar or numerical values. Monetized costs and
benefits, on the other hand, have effects that can be expressed in
dollar values. The Office did not identify any monetized costs and
benefits of this Final Rule but found that this Final Rule has
significant qualitative benefits with no identified costs.
The qualitative costs and benefits that the RIA assesses are: (1)
Fee schedule design--a measure of how well the fee schedule aligns with
the key fee setting policy factors; and (2) securing aggregate revenue
to recover aggregate cost--a measure of whether the alternative
provides adequate revenue to support the core mission and strategic
priorities based on assumptions and estimates found in the FY 2021
Budget and described in the Final Rule, Strategic Plan, and FY 2021
Budget. Based on the costs and benefits identified and analyzed in the
RIA, the fee schedule detailed in this Final Rule offers the highest
net benefits. As described throughout this document, the final patent
fee schedule maintains the existing balance of below-cost entry fees
(e.g., filing, search, and examination) and above-cost maintenance fees
as one approach to foster innovation. Further, as detailed in Part V:
Individual Fee Rationale, the fee changes are targeted in support of
one or more fee setting policy factors. Lastly, this Final Rule secures
the aggregate revenue needed to achieve the strategic priorities
encompassed in the rulemaking goals and strategies (see Part III:
Rulemaking Goals and Strategies). The final patent fee schedule allows
for optimizing patent quality and timeliness. This significantly
increases the value of patents by advancing commercialization of new
technologies sooner and reducing uncertainty regarding the scope of
patent rights, which fosters innovation and has a positive effect on
economic growth. The RIA explains the results in more detail at https://www.uspto.gov/FeeSettingAndAdjusting.
II. Legal Framework
A. Leahy-Smith America Invents Act--Section 10
The Leahy-Smith America Invents Act was enacted into law on
September 16, 2011. See Public Law 112-29, 125 Stat. 284. Section 10(a)
of the Act authorizes the director of the Office to set or adjust by
rule any patent fee established, authorized, or charged under title 35,
U.S.C., for any services performed by, or materials furnished by, the
Office. Fees under title 35 of the U.S.C. may be set or adjusted only
to recover the aggregate estimated cost to the Office for processing,
activities, services, and materials related to patents, including
administrative costs to the Office with respect to such patent
operations. See 125 Stat. at 316. Provided that the fees in the
aggregate achieve overall aggregate cost recovery, the director may set
individual fees under section 10 at, below, or above their respective
cost. Section 10(e) of the Act requires the director to publish the
final fee rule in the Federal Register and the Official Gazette of the
USPTO at least 45 days before the final fees become effective. Section
10(i) terminates the director's authority to set or adjust any fee
under section 10(a) upon the expiration of the seven-year period that
began on September 16, 2011.
B. The Study of Underrepresented Classes Chasing Engineering and
Science Success Act of 2018
The Study of Underrepresented Classes Chasing Engineering and
Science Success Act of 2018 (SUCCESS Act), was enacted into law on
October 31, 2018. See Public Law 115-273, 132 Stat. 4158. Section 4 of
the SUCCESS Act amended section 10(i)(2) of the AIA by striking ``7-
year'' and inserting ``15-year'' in reference to the expiration of fee
setting authority. Therefore, the updated section 10(i) of the AIA, as
amended, terminates the director's authority to set or adjust any fee
under section 10(a) upon the expiration of the 15-year period that
began on September 16, 2011, and ends on September 16, 2026.
C. Small Entity Fee Reduction
Section 10(b) of the AIA requires the Office to reduce by 50
percent the fees for small entities that are set or adjusted under
section 10(a) for filing, searching, examining, issuing, appealing, and
maintaining patent applications and patents.
D. Micro Entity Fee Reduction
Section 10(g) of the AIA amended 35 U.S.C. ch. 11 by adding section
123 concerning micro entities. The Act provides that the Office must
reduce by 75 percent the fees for micro entities for filing, searching,
examining, issuing, appealing, and maintaining patent applications and
patents. Micro entity fees were implemented through the January 2013
Final Rule, and the Office will maintain this 75 percent micro entity
discount for the appropriate fees and will implement micro entity fees
for additional services as appropriate.
E. Patent Public Advisory Committee Role
The Secretary of Commerce established the PPAC under the American
Inventors Protection Act of 1999. 35 U.S.C. 5. The PPAC advises the
Under Secretary of Commerce for Intellectual Property and Director of
the USPTO on the management, policies, goals, performance, budget, and
user fees of patent operations.
When adopting fees under section 10 of the Act, the director must
provide the PPAC with the proposed fees at least 45 days prior to
publishing the proposed fees in the Federal Register. The PPAC then has
at least 30 days within which to deliberate, consider, and comment on
the proposal, as well as hold public hearing(s) on the proposed fees.
The PPAC must make available to the public a written report of the
comments, advice, and recommendations of the committee regarding the
proposed fees before the Office issues any final fees. The Office
considers and analyzes any comments, advice, or recommendations
received from the PPAC before finally setting or adjusting fees.
Consistent with this framework, on August 8, 2018, the director
notified the PPAC of the Office's intent to set or adjust patent fees
and submitted a
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preliminary patent fee proposal with supporting materials. The
preliminary patent fee proposal and associated materials are available
at https://www.uspto.gov/FeeSettingAndAdjusting. The PPAC held a public
hearing in Alexandria, Virginia, on September 6, 2018. Transcripts of
the hearing are available for review at https://www.uspto.gov/sites/default/files/documents/PPAC_Hearing_Transcript_20180906.pdf. Members
of the public were invited to the hearing and given the opportunity to
submit written and/or oral testimony for the PPAC to consider. The PPAC
considered such public comments from this hearing and made all comments
available to the public via the Fee Setting and Adjusting section of
the USPTO website, https://www.uspto.gov/FeeSettingAndAdjusting. The
PPAC also provided a written report setting forth in detail the
comments, advice, and recommendations of the committee regarding the
preliminary proposed fees. The report regarding the preliminary
proposed fees was released on October 29, 2018, and can be found online
at https://www.uspto.gov/sites/default/files/documents/PPAC_Fee_Setting_Report_Oct2018_1.pdf.
The Office considered and analyzed all comments, advice, and
recommendations received from the PPAC before publishing the notice of
proposed rulemaking (NPRM) Setting and Adjusting Patent Fees during
Fiscal Year 2020. The NPRM and associated materials are available at
https://www.uspto.gov/FeeSettingAndAdjusting. Likewise, before issuing
this Final Rule, the Office considered and analyzed all comments,
advice, and recommendations received from the public during the 60-day
comment period. The Office's response to comments received is available
in Part VI: Discussion of Comments.
III. Rulemaking Goals and Strategies
A. Fee Setting Strategy
The overall strategy of this Final Rule is to establish a fee
schedule that generates sufficient multi-year revenue to recover the
aggregate cost of maintaining USPTO patent-related operations and
accomplishing the USPTO's patent-related strategic goals in accordance
with the authority granted to the USPTO by AIA section 10, as amended
by the SUCCESS Act. The overriding principles behind this strategy are
to operate within a sustainable funding model to avoid disruptions
caused by fluctuations in financial operations and to enable the USPTO
to continue strategic improvements, such as optimizing patent
application pendency; issuing highly reliable patents; fostering
innovation through business effectiveness; enhancing operations of the
PTAB; and optimizing the speed, quality, and cost effectiveness of
information technology delivery to achieve business value.
In addition to the overriding principles outlined above, as
discussed earlier in this document the Office assesses its alignment
with the four key fee setting policy factors: (1) Promoting innovation
strategies, (2) aligning fees with the full cost of products and
services, (3) facilitating the effective administration of the U.S.
patent system, and (4) offering patent processing options to
applicants. Each factor promotes a particular aspect of the U.S. patent
system. Promoting innovation strategies seeks to ensure barriers to
entry into the U.S. patent system remain low, and innovation is
incentivized by granting inventors certain short-term exclusive rights
to stimulate additional inventive activity. Aligning fees with the full
cost of products and services recognizes that as a fully fee-funded
entity, the Office must account for all of its costs, even as it elects
to set certain fees below, at, or above cost. This factor also
recognizes that some applicants may use particular services in a much
more costly manner than other applicants (e.g., patent applications
cost more to process when more claims are filed). Facilitating
effective administration of the patent system seeks to encourage patent
prosecution strategies that promote efficient patent prosecution,
resulting in compact prosecution and a reduction in the time it takes
to obtain a patent. Finally, the Office recognizes that patent
prosecution is not a one-size-fits-all process; therefore, where
feasible, the Office endeavors to fulfill its fourth policy factor of
offering patent processing options to applicants.
B. Fee Setting Considerations
The balance of this sub-section presents the specific fee setting
considerations the Office reviewed in developing the final patent fee
schedule. Specific considerations are: (1) Historical costs of patent
operations and investments to date in meeting the Office's strategic
goals; (2) the balance between projected costs to meet the Office's
operational needs and strategic goals and the projected future year fee
collections; (3) fee schedule design; (4) sustainable funding; and (5)
the comments, advice, and recommendations offered by the PPAC on the
Office's initial fee setting proposal and the public comments received
in response to the July 2019 NPRM. The Office carefully considered the
comments, advice, and recommendations offered by the PPAC and public.
Collectively, these considerations informed the Office's chosen
rulemaking strategy.
(1) Historical Cost. To ascertain how to best align fees with the
full cost of products and services, the Office considers unit cost data
provided by the USPTO's activity based information (ABI) program. Using
historical cost data and forecasted application demands, the Office can
align fees with the costs of specific patent products and services. The
document entitled ``Setting and Adjusting Patent Fees during Fiscal
Year 2020--Activity Based Information and Patent Fee Unit Expense
Methodology,'' available at https://www.uspto.gov/FeeSettingAndAdjusting, provides details on the Office's costing
methodology in addition to four years of historical cost data. Part IV
of this Final Rule details the Office's methodology for establishing
fees. Additionally, Part V describes the reasoning for setting some
fees at cost, below cost, or above cost such that the Office recovers
the aggregate cost of providing services through fees.
(2) Projected Costs and Revenue. In developing this Final Rule, the
USPTO considered estimates of future year workload demands, fee
collections, and costs to maintain core USPTO operations and meet the
Office's strategic goals, all of which can be found in the FY 2021
Budget. The FY 2021 Budget and the Strategic Plan highlight the
priorities of: optimizing patent application pendency; issuing highly
reliable patents; fostering innovation through business effectiveness;
enhancing operations of the PTAB; optimizing the speed, quality, and
cost effectiveness of IT delivery to achieve business value; and
ensuring financial sustainability to facilitate effective USPTO
operations. This also enables the USPTO to continue to leverage
nationwide talent to build, retain, and effectively manage the highly
educated and talented workforce it needs to properly serve its
stakeholder community and the country.
(a) Updated Revenue Estimates. As is discussed in more detail in
Part IV: Fee Setting Methodology, when setting fees at appropriate
levels to recover aggregate costs, the USPTO must estimate future year
demand for its products and services through a careful analysis of
economic conditions, potential changes in the legal and policy
[[Page 46937]]
environment, and operational efficiency and productivity. Many of these
factors fall outside the USPTO's control. Since the time that the USPTO
published the January 2018 Final Rule, new information has become
available that has resulted in adjustments to several of the
assumptions underlying the Office's revenue projections. The result of
this change is a lowering of revenue expectations under the existing
fee schedule. This reduction is due to a number of factors, including a
reduction in the estimates for request for continued examination (RCE)
submissions over several years and maintenance fee collections. These
assumptions and estimates are found in the FY 2021 Budget.
Despite increases in serialized filings in FYs 2017 through 2019,
the rate of RCE submissions during that same time period was much less
than expected. In particular, 2018 and 2019 saw a 10 percent decrease
in the number of RCEs filed compared to the number projected, and RCE
projections for FY 2020 and beyond have been reduced accordingly (as
found in the FY 2021 Budget). This reduction of RCEs enables USPTO
examining staff to re-allocate more of their time to examine an
increased number of serialized filings, thereby reducing our unexamined
inventory. While the USPTO considers the reduction in RCE submissions
to be a generally positive development, it has resulted in the FY 2020
and FY 2021 revenues being lower than expected when the January 2018
Final Rule was published.
In FYs 2017 through 2019 maintenance fee collections, particularly
the most expensive third stage collections, were lower than projected.
As a result, the refreshed forecast included in the FY 2021 Budget has
been lowered.
Absent the increase in fees or an unsustainable reduction in
operating costs, the USPTO will be forced to draw down its operating
reserves and take on higher levels of financial risk.
(b) Quality, Backlog, and Pendency. The strategic goal to
``optimize patent quality and timeliness'' recognizes the importance of
innovation as the foundation of American economic growth and national
competitiveness. Through this goal, the Office will continually improve
patent quality, particularly the predictability and reliability of
issued patents. The USPTO is also committed to improving pendency to
better ensure the timely delivery of innovative goods and services to
market and the related economic growth and creation of new or higher-
paying jobs.
The Office will continue to diligently make progress toward
pendency targets and quality expectations to issue predictable and
reliable patents while also addressing the anticipated growth in
application filings. The Office will work to optimize patent
examination time frames within the framework of patent term adjustment
(PTA) while continuing to monitor and report traditional pendency
measures. This includes engaging customers to identify optimal pendency
and examination time frames and making sure that the Office has the
appropriate number of examiners to generate the level of production to
meet those time frames. This Final Rule will produce revenues adequate
to continue the USPTO's progress towards attaining its strategic goal
to optimize patent quality and timeliness.
The Office recognizes the importance of issuing high-quality
patents that provide reliable and predictable intellectual property
protection. If the USPTO is to achieve its strategic objective of
issuing highly reliable patents, patent examiners must be afforded
sufficient time to conduct a thorough and complete examination of each
application. In the time since fees were last adjusted, the USPTO has
completed a comprehensive analysis of examination time, known as ETA,
the result of which determined a need for updates to the allotment of
examination time.
In the past, allotment of examination time for a particular
application was determined by the most comprehensive claim and could
not account for multi-disciplinary inventions. Sometimes, patent
applications of similar technologies would receive disparate time for
examination as a result. This, together with significant changes in
patent prosecution that have occurred since examination time goals were
established over 40 years ago--such as advancements in the
technological complexities of applications, a growing volume of prior
art, and a changing legal landscape--has brought about the need for
updates to the allotment of examination time. The time examiners are
given to examine applications is the critical link between pendency and
quality. These updates reflect internal and external stakeholders'
priorities and experiences as they relate to examination time, quality,
and application complexity, and also enable optimal pendency and
quality levels.
In addition to the changing legal landscape, increasing technical
complexities of applications, and the growing volume of prior art to be
searched during examination, updates to examination time will also take
into account the full scope of technology recited in an application as
well as the particular attributes of the application, such as the
number of claims, the size of the specification, and the number of
references cited in any filed information disclosure statement. Based
on technology examined, examiners who currently receive the least
amount of time for examination will generally see the largest increases
in examination time, and conversely, examiners who currently receive
the highest amount of time may see little, if any, increase in
examination time. Further, all examiners will be provided additional
examination time based on the specific attributes of the application.
Together, these changes improve the calibration of the time needed to
conduct a thorough examination, position the Office to better adjust
time in the future as needed, and provide stakeholders increased
confidence in the certainty of any resultant patent rights.
Separate from the ETA findings, analysis of the patent staffing
model indicates an incremental decrease in examiners' average net
output over time, resulting in higher core patent examination costs
than in previous estimates. One possible explanation for this reduction
in output may be that the percentage of examiners receiving production
awards has dropped, and a larger number of examiners are forgoing
promotions and staying at lower grades. Additionally, applicants'
increased use of programs like the after final consideration pilot
(AFCP) and interviews, along with increased training needs due to
changes in the legal landscape and examination practices, has increased
the amount of non-examination time used by examiners, also leading to
productivity losses.
Another area where essential operating costs have increased is the
PTAB. The PTAB, as it currently exists, was established by the AIA in
September 2012. The PTAB manages pendency for three different
activities: AIA trials, which, by statute, must be adjudicated within
one year of filing; re-examination petitions, which, by statute, must
be completed with ``special dispatch''; and ex parte appeals. The PTAB
is committed to resolving appeals and inter partes matters within
statutory or USPTO time frames, while streamlining processes and
procedures throughout the PTAB. This entails retaining and leveraging
nationwide talent. As the Office institutes operational changes at the
PTAB to comply with the SAS decision and implements other improvements,
as
[[Page 46938]]
detailed in Part V: Individual Fee Rationale, the average workload
associated with each trial is increasing.
(c) Business Effectiveness. Given the estimates of costs and
revenue found in the FY 2021 Budget and absent efforts to boost future
revenue, funding for other USPTO and stakeholder priorities, like IT
stabilization and modernization and other business improvement
initiatives, will need to be reduced to well below planned levels in
the coming years. To this end, revenue generated from the final patent
fee schedule will enable the USPTO to focus on how the Patents
organization operates to foster business effectiveness. In fulfilling
this objective, the Office will listen to customers and employees and
then take patent-specific actions that will position the Office to meet
expectations.
The USPTO will provide the cutting-edge tools that employees and
customers need to efficiently and effectively accomplish their tasks,
particularly through the continued implementation of Patents End-to-
End. For example, this could entail the use of artificial intelligence
or machine-learning efforts. Another key initiative that will enhance
the work capabilities of both employees and customers is to improve
searchable (text) access to domestic and international patent
applications, including access to non-patent literature and prior art,
and Office actions.
(3) Fee Schedule Design. The final fee schedule was designed to set
individual fees to further key policy considerations while taking into
account the cost of the particular service. To encourage innovators to
take advantage of patent protection, the Office continues its
longstanding practice of setting basic ``front-end'' fees (e.g.,
filing, search, and examination) below the actual cost of carrying out
these activities. Additionally, new fees are set, and existing fees are
adjusted, in order to facilitate the effective administration of the
patent system. Part IV of this Final Rule details the Office's
methodology for establishing fees, and Part V describes the reasoning
for setting and adjusting individual fees, including fee schedule
design benefits. The RIA, available at https://www.uspto.gov/FeeSettingAndAdjusting, also discusses fee schedule design benefits.
(4) Sustainable Funding. A major component of sustainable funding
is the creation and maintenance of a viable patent operating reserve
that allows for effective management of the U.S. patent system and
responsiveness to changes in the economy, unanticipated production
workload, and revenue changes. As a fee-funded agency, the USPTO uses
its reserves to mitigate the variability in its spending and revenue
streams that can create volatility in patent operations and threaten
the Office's ability to support mission operations.
The USPTO aims to manage the operating reserve within a range of
acceptable balances and evaluates its options when projected balances
fall either below or above that range. Minimum planning targets are
assessed annually and are intended to address immediate unplanned
changes in the economic or operating environments as the Office builds
its reserve to the optimal level. The optimal reserve target, which is
reviewed at least biennially, is established based on an assessment of
the likelihood and severity of an array of financial risks. A 2019
evaluation of the patent operating reserve relative to the financial
risk environment, revalidated the optimal reserve level of three
months' operating expenses as the appropriate long-range target given
various risk factors, such as the high percentage of fixed costs in the
Patent business and recent and potential changes in the legal,
judicial, and policy environments. For the Patent business line's
operating reserve, a minimum planning level of approximately $300
million--just over one month's operating expenses--has been
established. The USPTO's annual budget delineates prospective spending
levels (aggregate costs) to execute core mission activities and
strategic initiatives. In the FY 2021 Budget, the USPTO estimated that
its aggregate patent operating costs for FY 2021, including
administrative costs, would be $3.3 billion, and aggregate estimated
patent fee collections and other income would be $3.4 billion, with the
difference being added to the operating reserve. The health of the
operating reserve is a key consideration as the USPTO sets its fees.
Aided by the increased fees detailed in this Final Rule, future year
projections are anticipated to gradually build the operating reserve
toward the optimal level of three months' operating requirements while
maintaining the minimum operating reserve balance during the five-year
period. The projections found in the FY 2021 Budget are based on point-
in-time estimates and assumptions that are subject to change. For
instance, the budget includes assumptions about filing levels, renewal
rates, whether the president will authorize or Congress will mandate
employee pay raises, the productivity of the workforce, and many other
factors. A change in any of these factors could have a significant
cumulative impact on reserve balances. For example, the legally
mandated 2019 and 2020 pay raises added a cumulative cost of $445
million (from FY 2020 to FY 2024) to patent operations. As seen in
Table 2, set forth in Part IV: Fee Setting Methodology, over a five-
year planning horizon the operating reserve balance can change
significantly, underscoring the Office's financial vulnerability to
various risk factors and the importance of fee setting authority.
The USPTO will continue to assess the patent operating reserve
balance against its target balance annually, and at least every two
years, the Office will evaluate whether the optimal target balance
continues to be sufficient to provide the stable funding the Office
needs. Per the Office's operating reserve policy, if the operating
reserve balance is projected to exceed the optimal level by 10 percent
for two consecutive years, the Office will consider fee reductions.
Under the new fee structure, as in the past, the Office will continue
to regularly review its operating budgets and long-range plans to
ensure the USPTO uses patent fees prudently.
(5) Comments, Advice, and Recommendations from the PPAC and the
Public. As detailed in the NPRM, in the report prepared in accordance
with AIA fee setting authority, the PPAC conveyed support for the USPTO
in seeking the revenues it needs to increase the reliability and
certainty of patent rights, provide timely examination, improve and
secure its IT infrastructure, and adequately fund its operating
reserve. Specifically, the report stated, ``As a general matter, we
believe that increased revenue for the USPTO will be important to
fulfill its Strategic Plan and implement the recommendations of the
PPAC.'' Patent Pub. Advisory Comm., Fee Setting Report (2018). The
Office considered and analyzed the comments, advice, and
recommendations received from the PPAC before publishing this Final
Rule.
Likewise, the Office considered and analyzed the comments, advice,
and recommendations received from the public during the 60-day comment
period before publishing this Final Rule. The Office's response to
comments received is available in Part VI: Discussion of Comments.
C. Summary of Rationale and Purpose of the Final Rule
The Office estimates that the patent fee schedule in this Final
Rule will produce aggregate revenues to recover the aggregate costs of
patent operations, including the implementation of its strategic and
mission support goals,
[[Page 46939]]
objectives, and initiatives in FY 2020 and beyond. Using the Strategic
Plan as a foundation, the Final Rule will provide sufficient aggregate
revenue to recover the aggregate cost of patent operations, including
optimizing patent application pendency; issuing highly reliable
patents; fostering innovation through business effectiveness; enhancing
the operations of the PTAB; optimizing the speed, quality, and cost-
effectiveness of information technology delivery to achieve business
value; and ensuring financial sustainability to facilitate effective
operations.
IV. Fee Setting Methodology
The Office carried out three primary steps in developing the final
patent fee schedule:
Step 1: Determine the prospective aggregate costs of patent
operations over the five-year period, including the cost of
implementing new initiatives to achieve strategic goals and objectives.
Step 2: Calculate the prospective revenue streams derived from the
individual fee amounts (from Step 3) that will collectively recover the
prospective aggregate costs over the five-year period.
Step 3: Set or adjust individual fee amounts to collectively
(through executing Step 2) recover projected aggregate costs over the
five-year period, while furthering key policy factors.
These three steps are iterative and interrelated. The following is
a description of how the USPTO carries out these three steps.
Step 1: Determine Prospective Aggregate Costs
Calculating prospective aggregate costs is accomplished primarily
through the annual USPTO budget formulation process. The budget is a
five-year plan (that the Office prepares annually) for carrying out
base programs and new initiatives to implement the USPTO's strategic
goals and objectives.
The first activity performed to determine prospective aggregate
costs is to project the level of demand for patent products and
services. Demand for products and services depends on many factors that
are subject to change, including domestic and global economic activity.
The USPTO also takes into account overseas patenting activities,
policies and legislation, and known process efficiencies. Because
filing, search, and examination costs are the largest share of the
total patent operating costs, a primary production workload driver is
the number of patent application filings (i.e., incoming work to the
Office). The Office looks at indicators such as the expected growth in
real gross domestic product (RGDP), the leading indicator of incoming
patent applications, to estimate prospective workload. RGDP is reported
by the Bureau of Economic Analysis (www.bea.gov) and is forecasted each
February by the OMB (www.omb.gov) in the Economic and Budget Analyses
section of the Analytical Perspectives and twice annually by the
Congressional Budget Office (CBO) (www.cbo.gov) in the Budget and
Economic Outlook. A description of the Office's methodology for using
RGDP can be found in Appendix III: Multi-year Planning by Business
Line, of the FY 2021 Budget. The expected change in the required
production workload must then be compared to the current examination
production capacity to determine any required staffing and operating
cost (e.g., salaries, workload processing contracts, and publication)
adjustments. The Office uses a patent pendency model that estimates
patent production output based on actual historical data and input
assumptions, such as incoming patent applications and overtime hours.
An overview of the model, including a description of inputs, outputs,
key data relationships, and a simulation tool is available at https://www.uspto.gov/patents/stats/patent_pend_model.jsp.
The second activity is to calculate the aggregate costs to execute
the requirements. In developing its budget, the Office first looks at
the cost of status quo operations (the base requirements). The base
requirements are adjusted for OMB-directed pay increases and
inflationary increases for the budget year and four out-years (detailed
calculations and assumptions for this adjustment can be found in the FY
2021 Budget). The Office then estimates the prospective cost of
expected changes in production workload and new initiatives over the
same period of time (refer to ``Program Changes by Sub-Program''
sections of the FY 2021 Budget). The Office reduces cost estimates for
completed initiatives and known cost savings expected over the same
five-year horizon. Finally, the Office estimates its three-month target
operating reserve level based on this aggregate cost calculation for
the year to determine if operating reserve adjustments are necessary.
Based on the assumptions and estimates found in the FY 2021 Budget,
during FY 2020, patent operations will cost $3.256 billion (see
Appendix II of the FY 2021 Budget), including $2.221 billion for patent
examining; $92 million for patent trial and appeals; $167 million for
patent information resources; $28 million for activities related to IP
protection, policy, and enforcement; and $754 million for general
support costs necessary for patent operations (e.g., the patent share
of rent; utilities; legal, financial, human resources, and other
administrative services; and Office-wide IT infrastructure and support
costs). In addition, the Office will transfer $2 million to the
Department of Commerce Inspector General for audit support. The Office
also estimates collecting $34 million in other income associated with
recoveries and reimbursable agreements (offsets to spending).
A detailed description of the operating requirements and related
aggregate costs is located in the FY 2021 Budget. Table 1 below
provides key underlying production workload projections and assumptions
from the FY 2021 Budget used to calculate aggregate costs. Table 2 (see
Step 2) presents the total budgetary requirements (prospective
aggregate costs) for FY 2020 through FY 2024 and the estimated
collections and operating reserve balances that will result from the
adjustments contained in this Final Rule. As the FY 2021 Budget notes,
these projections are based on point-in-time estimates and assumptions
that are subject to change. There is considerable uncertainty in out-
year budgetary requirements. A number of risks could materialize over
the next several years (e.g., those associated with the re-compete of
major contracts, including property leases, changing assumptions about
presidentially authorized or congressionally mandated employee pay
raises, etc.) that could increase the USPTO's budgetary requirements in
the short- to medium-term. These estimates are refreshed annually in
the production of the USPTO's Budget.
Table 1--Patent Production Workload Projections--FY 2020-FY 2024
--------------------------------------------------------------------------------------------------------------------------------------------------------
FY 2020 FY 2021 FY 2022 FY 2023 FY 2024
--------------------------------------------------------------------------------------------------------------------------------------------------------
Utility, Plant, and Reissue (UPR):
Applications *....................................... 632,400 632,100 642,700 652,900 662,500
[[Page 46940]]
Application Growth Rate.............................. 1.9% 0.0% 1.7% 1.6% 1.5%
Production Units..................................... 604,300 589,500 607,700 626,400 642,600
Unexamined Patent Application Backlog................ 559,600 571,600 569,300 557,600 538,400
Examination Capacity **.............................. 8,451 8,780 9,094 9,395 9,684
Performance Measures (UPR):
Avg. First Action Pendency (Months).................. 15.5 15.5 15.4 15.0 14.5
Avg. Total Pendency (Months)......................... 23.7 23.9 24.0 23.7 23.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
* In this table, the patent application filing data includes requests for continued examination (RCEs).
** In this table, Examination Capacity is the UPR Examiners On-Board at End-of-Year, as described in the FY 2021 Budget.
Step 2: Calculate Prospective Aggregate Revenue
As described above in Step 1, the USPTO's FY 2020 requirements in
the FY 2021 Budget include the aggregate prospective costs of planned
production, anticipated new initiatives, and a contribution to the
patent operating reserve required for the Office to maintain patent
operations and realize its strategic goals and objectives for the next
five years. The aggregate prospective costs become the target aggregate
revenue level that the new fee schedule must generate in a given year
and over the five-year planning horizon. To calculate the aggregate
revenue estimates, the Office first analyzes relevant factors and
indicators to calculate or determine prospective fee workloads (e.g.,
number of applications and requests for services and products), growth
in those workloads, and resulting fee workload volumes (quantities) for
the five-year planning horizon.
The Office considers economic activity when developing fee
workloads and aggregate revenue forecasts for its products and
services. Major economic indicators include the overall condition of
the U.S. and global economies, spending on research and development
activities, and investments that lead to the commercialization of new
products and services. The most relevant economic indicator that the
Office uses is the RGDP, which is the broadest measure of economic
activity. At the time the FY 2021 Budget was developed, CBO anticipated
RGDP to grow around 2.2 percent in FY 2020 and 1.9 percent in FY 2021.
These indicators correlate with patent application filings, which
are key drivers of patent fees. Economic indicators also provide
insight into market conditions and the management of IP portfolios,
which influence application processing requests and post-issuance
decisions to maintain patent protection. When developing fee workload
forecasts, the Office considers other influential factors, including
overseas activity, policies and legislation, court decisions, process
efficiencies, and anticipated applicant behavior.
Anticipated applicant behavior in response to fee changes is
measured using an economic principle known as elasticity, which, for
the purpose of this Final Rule, measures how sensitive applicants and
patentees are to changes in fee amounts. The higher the elasticity
measure (in absolute value), the greater the applicant response to the
relevant fee change. If elasticity is low enough (i.e., demand is
inelastic, or the elasticity measure is less than one in absolute
value), a fee increase will lead to only a relatively small decrease in
patent activities, and overall revenues will still increase.
Conversely, if elasticity is high enough (i.e., demand is elastic, or
the elasticity measure is greater than one in absolute value), a fee
increase will lead to a relatively large decrease in patenting
activities such that overall revenues will decrease. When developing
fee forecasts, the Office accounts for how applicant behavior will
change at different fee amounts projected for the various patent
services. The Office analyzed elasticity for nine broad patent fee
categories: filing/search/examination fees, excess independent claims
fees, excess total claims fees, application size (excess page) fees,
issue fees, RCE fees, appeal fees, AIA trial fees, and maintenance
fees, including distinctions by entity size where applicable.
Additional details about the Office's elasticity estimates can be found
in ``Setting and Adjusting Patent Fees during Fiscal Year 2020--
Description of Elasticity Estimates,'' available at https://www.uspto.gov/FeeSettingAndAdjusting.
Summary of Step 2
Patent fees are collected for patent-related services and products
at different points in the patent application examination process and
over the life of the pending patent application and granted patent.
Approximately half of all patent fee collections are from maintenance
fees, which subsidize the cost of filing, search, and examination
activities. Changes in application filing levels immediately impact
current year fee collections, because fewer patent application filings
means the Office collects fewer fees to devote to production-related
costs. The resulting reduction in production activities also creates an
out-year revenue impact because less production output in one year
results in fewer issue and maintenance fee payments in future years.
The USPTO's five-year estimated aggregate patent fee revenue, based
on assumptions found in the FY 2021 Budget, (see Table 2) is based on
the number of patent applications it expects to receive for a given
fiscal year, work it expects to process in a given fiscal year (an
indicator of future patent issue fee workload), expected examination
and process requests for the fiscal year, and the expected number of
post-issuance decisions to maintain patent protection over that same
fiscal year. Within the iterative process for estimating aggregate
revenue, the Office adjusts individual fee rates up or down based on
cost and policy decisions (see Step 3: Set Specific Fee Amounts),
estimates the effective dates of new fee rates, and then multiplies the
resulting fee rates by appropriate workload volumes to calculate a
revenue estimate for each fee. To calculate the aggregate revenue for
the FY 2021 Budget, the Office assumed that all Final Rule fee rates
would become effective on July 10, 2020, except for the new non-DOCX
filing surcharge fee, which was assumed to become effective on January
1, 2021. The effective dates of all Final Rule fee rates have since
been delayed from those original assumptions as USPTO further assessed
the impact of the
[[Page 46941]]
pandemic on the economy and stakeholders. Using these figures, the
USPTO summed the individual fee revenue estimates, and the result is a
total aggregate revenue estimate for a given year (see Table 2).
Additional details about the Office's aggregate revenue, including
projected workloads by fee, can be found in ``Aggregate Revenue Tables,
Final Patent Rule Schedule'' available at https://www.uspto.gov/FeeSettingAndAdjusting.
Table 2 shows the available revenue and operating reserve balances
by fiscal year, including the Final Rule fee rates in the projected fee
collections. The estimates in the table can be found in the FY 2021
Budget and were developed in late calendar year 2019, prior to the
COVID-19 outbreak. Under current circumstances, it is difficult to
predict what the actual numbers will be.
Table 2--Patent Financial Outlook--FY 2020-FY 2024
--------------------------------------------------------------------------------------------------------------------------------------------------------
Dollars in millions
----------------------------------------------------------------------------------------------
FY 2020 FY 2021* FY 2022 FY 2023 FY 2024
--------------------------------------------------------------------------------------------------------------------------------------------------------
Projected Fee Collections................................ 3,400 3,251 3,709 3,744 3,861
Other Income............................................. 34 34 34 34 34
Total Projected Fee Collections and Other Income......... 3,435 3,285 3,743 3,778 3,895
Budgetary Requirements................................... 3,256 3,455 3,601 3,681 3,800
Funding to (+) and from (-) Operating Reserve............ 179 (170) 141 97 95
EOY Operating Reserve Balance............................ 587 417 558 656 751
Over/(Under) $300M Minimum Level......................... 287 117 258 356 451
Over/(Under) Optimal Level............................... (227) (447) (342) (265) (200)
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The assumed effective date for the Final Patent Fee Schedule shifts some projected collections from FY 2021 to FY 2020, due to the expectation that
patentees who are eligible will submit maintenance fee payments prior to the effective date of the Final Rule.
Step 3: Set Specific Fee Amounts
Once the Office finalizes the annual requirements and aggregate
prospective costs through the budget formulation process, the Office
determines specific fee amounts that, together, will derive the
aggregate revenue required to recover the estimated aggregate
prospective costs during the five-year budget horizon. Calculating
individual fees is an iterative process that encompasses many variables
and policy factors. These are discussed in greater detail in Part V:
Individual Fee Rationale.
One of the variables the USPTO considers to inform fee setting is
the historical cost estimates associated with individual fees. The
Office's ABI provides historical costs for an organization's activities
and outputs by individual fees using the activity based costing (ABC)
methodology. ABC is commonly used for fee setting throughout the
federal government. Additional information about the methodology,
including the cost components related to respective fees, can be found
in the document entitled ``Setting and Adjusting Patent Fees during
Fiscal Year 2020--Activity Based Information and Patent Fee Unit
Expense Methodology'' available at https://www.uspto.gov/FeeSettingAndAdjusting. The USPTO provides data for FY 2016-FY 2019
because the Office finds that reviewing the trend of ABI historical
cost information is the most useful way to inform fee setting. The
underlying ABI data are available for public inspection at the USPTO
upon request.
When the Office implements a new process or service, historical ABI
data is typically not available. However, the Office will use the
historical cost of a similar process or procedure as a starting point
to estimate the full cost of a new activity or service.
V. Individual Fee Rationale
Based on assumptions and estimates found in the FY 2021 Budget, the
Office projects that the aggregate revenue generated from the new
patent fees will recover the prospective aggregate cost of its patent
operations including contributions to the operating reserve, per the
strategic initiative to ensure financial sustainability to facilitate
effective USPTO operations. As detailed previously, the PPAC supports
this approach, stating that, ``The PPAC supports the USPTO in seeking
the revenues it needs to increase the reliability and certainty of
patent rights, provide timely examination, improve and secure its IT
infrastructure and adequately fund its operating reserve'' Patent Pub.
Advisory Comm., Fee Setting Report [2] (2018).
It is important to recognize that each individual fee is not
necessarily set equal to the estimated cost of performing the
activities related to the fee. Instead, as described in Part III:
Rulemaking Goals and Strategies, some of the individual fees are set
at, above, or below their unit costs to balance several key fee setting
policy factors: Promoting innovation strategies, aligning fees with the
full cost of products and services, facilitating effective
administration of the patent system, and offering patent processing
options to applicants. For example, many of the initial filing fees are
intentionally set below unit costs in order to promote innovation
strategies by removing barriers to entry for innovators. To balance the
aggregate revenue loss of fees set below cost, other fees must be set
above cost in areas where it is less likely to reduce inventorship
(e.g., maintenance).
For some fees in this Final Rule, such as excess claims fees, the
USPTO does not typically maintain individual historical cost data for
the service provided. Instead, the Office considers the policy factors
described in Part III to inform fee setting. For example, by setting
fees at particular levels using the facilitating effective
administration of the patent system policy factor, the USPTO aims to:
(1) Foster an environment where examiners can provide and applicants
can receive prompt, quality interim and final decisions; (2) encourage
the prompt conclusion of prosecuting an application, resulting in
pendency reduction and the faster dissemination of patented
information; and (3) help recover costs for activities that strain the
patent system.
The rationale for the fee changes are grouped into three major
categories, discussed below: (A) Across-the-board adjustment to patent
fees; (B) targeted fees; and (C) discontinued fees. The purpose of the
categorization is to
[[Page 46942]]
identify large fee changes for the reader and provide an individual fee
rationale for such changes. The categorization is based on changes in
large entity fee amounts because percentage changes for small and micro
entity fees that are in place today would be the same as the percentage
change for the large entity, and the dollar change would be half or one
quarter of the large entity change.
The Table of Patent Fees includes the current and Final Patent Fee
Schedule fees for large, small, and micro entities as well as unit
costs for the last four fiscal years. Part VII: Discussion of Specific
Rules contains a complete listing of fees that are set or adjusted in
the patent fee schedule in this Final Rule.
A. Across-the-Board Adjustment to Patent Fees
In order to both keep the USPTO on a stable financial track and
allow for the advancement of policies and practices that enhance the
country's innovation ecosystem, the Office is adjusting all patent fees
not covered by the targeted adjustments as discussed in section B, or
to be discontinued as discussed in section C, by approximately 5
percent. Given the time that has passed between the implementation date
of the last fee adjustments and this Final Rule, a 5 percent increase
is similar to fees increasing by 2 percent annually to help USPTO keep
up with the cost of inflation and other cost increases, such as
mandatory pay raises not planned for in previous budgets. Individual
fees, above $50, are rounded to the nearest $10 \1\ by applying
standard arithmetic rules. For fees that have small and micro entity
fee reductions, the large entity fee is rounded up or down to the
nearest 20 dollars by applying standard arithmetic rules. The resulting
fee amounts are more convenient to patent users and permit the Office
to set small and micro entity fees at whole dollar amounts when
applying the applicable fee reduction. Therefore, some smaller fees
will not be changing, since a 5 percent increase would round down to
the current fee, while other fees would change by slightly more or less
than 5 percent, depending on rounding. The fee adjustments in this
category are listed in the Table of Patent Fees.
---------------------------------------------------------------------------
\1\ The description of the rounding rule in the NPRM incorrectly
indicated that fees were rounded to the nearest $5, rather than to
the nearest $10. This error has been corrected in this Final Rule.
The fees proposed in the NPRM and implemented in this Final Rule
were both rounded to the nearest $10 and are not affected by the
error in the description.
---------------------------------------------------------------------------
The 5 percent across-the-board adjustment strikes an appropriate
balance between projected aggregate revenue and aggregate costs based
on the assumptions used to develop the point-in-time estimates that
support this Final Rule. The underlying cost and revenue estimates in
this Final Rule, which are supported by the FY 2021 Budget, show that
fees are set at levels that secure aggregate cost recovery while
ensuring a reasonable pace for operating reserve growth.
B. Targeted Fees
For those fees targeted for specific adjustments in this Final
Rule, the individual fee rationale discussion is divided into two
categories: (1) Adjustments to existing fees, and (2) new fees.
Adjustments to existing fees are further divided into subcategories
according to the function of the fees, including: (a) Maintenance fee
surcharge, (b) request for the expedited examination of a design
application fee, (c) utility and reissue issue and maintenance fees,
and (d) AIA trial fees. New fees are further divided into subcategories
according to the function of the fees, including: (a) Non-DOCX filing
surcharge fee, and (b) pro hac vice. As discussed further below and in
USPTO's responses to public comments, the USPTO has considered public
feedback on the proposed (c) annual active patent practitioner fee and
has decided not to proceed with implementing this fee at this time. The
USPTO does plan to pursue procedures to allow patent practitioners to
voluntarily certify whether they have completed a minimum amount of
continuing legal education (CLE). The USPTO further expects that
registered practitioners who certify that they have completed such CLE
will be recognized in the online practitioner directory. In the near
future, the USPTO plans to issue proposed guidelines regarding such
voluntary CLE certification, with a request for public comments.
As discussed above, for purposes of comparing amounts in the
individual fee rationale discussion, the Office has included the
current fees as the baseline to calculate the dollar and percentage
changes for new fees.
(1) Adjustments to Existing Fees
The following fees are to be increased by an amount other than the
5 percent across-the-board increase for most patent-related fees. These
targeted adjustments are made for a variety of strategic reasons. A
discussion of the rationale for each fee follows.
(a) Maintenance Fee Surcharge
Table 3--Maintenance Fee Surcharge Fees--Fee Changes and Unit Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Final rule Percentage
Current fees fees large Dollar change change large FY 2018 FY 2019
Fee description large (small) (small) large (small) (small) unit cost unit cost
[micro] entity [micro] entity [micro] entity [micro] entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Surcharge--3.5 year--Late payment within 6 months............... $160 $500 +$340 +213 n/a n/a
($80) ($250) (+$170) (+213)
[$40] [$125] [+$85] [+213]
Surcharge--7.5 year--Late payment within 6 months............... $160 $500 +$340 +213 n/a n/a
($80) ($250) (+$170) (+213)
[$40] [$125] [+$85] [+213]
Surcharge--11.5 year--Late payment within 6 months.............. $160 $500 +$340 +213 n/a n/a
($80) ($250) (+$170) (+213)
[$40] [$125] [+$85] [+213]
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 46943]]
The Office will set the surcharge for a late maintenance fee
payment within six months following the due date at $500 for large
entities. It is the responsibility of the patentee to ensure
maintenance fees are paid timely to prevent expiration of a patent. If
a maintenance fee is not paid within the first six months of the year
in which it can be paid, a maintenance fee reminder notice is sent to
the fee address or correspondence address on record. Failure to receive
the notice does not shift the burden of monitoring the time for paying
a maintenance fee from the patentee to the USPTO. At this point, a
surcharge is required in addition to the maintenance fee in order to
maintain a patent. If the maintenance fee and any applicable surcharge
are not paid by the end of the 4th, 8th, or 12th years after the date
of issue, the patent rights lapse, and a Notice of Patent Expiration is
sent to the fee address or correspondence address on record. If a fee
address has not been established, the notices are sent to the
correspondence address. Over 95 percent of patent renewals are paid
before the due date, but some patents are renewed during the six-month
period following the due date.
While still below what other IP offices charge, increasing this
surcharge brings the USPTO more in line with its global counterparts.
The goal of increasing this surcharge is to encourage patent holders to
renew by the due date. Encouraging on-time renewals will benefit the
public by increasing the understanding of which patents remain in force
and which patent rights have been allowed to lapse.
The USPTO provides tools to help patent owners monitor due dates,
such as the Patent Maintenance Fees Storefront, https://fees.uspto.gov/MaintenanceFees, where anyone can see the payment windows for all
patents. Additionally, customers with USPTO.gov accounts (i.e.,
MyUSPTO) can create a ``patent docket'' and add patent or application
numbers in order to keep track of due dates. Also, the weekly Official
Gazette notices list the range of patents for which maintenance fees
are now payable. In addition, with the availability of free calendar
apps, individuals can easily set up their own reminders of when
maintenance fee payments are eligible for renewal (3, 7, 11 years from
issue) and when they are due (3.5, 7.5, 11.5 years from issue).
(b) Request for Expedited Examination of a Design Application Fee
Table 4--Request for Expedited Examination of a Design Application Fee--Fee Changes and Unit Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Final rule Percentage
Current fees fees large Dollar change change large FY 2018 FY 2019
Fee description large (small) (small) large (small) (small) unit cost unit cost
[micro] entity [micro] entity [micro] entity [micro] entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Request for expedited examination of a design application....... $900 $1,600 +$700 +78 $125 $97
($450) ($800) (+$350) (+78)
[$225] [$400] [+$175] [+78]
--------------------------------------------------------------------------------------------------------------------------------------------------------
In the NPRM, the Office proposed increasing the fee to request
expedited examination of a design application to $2,000. In this Final
Rule, after carefully considering comments from the PPAC and the
public, the Office is increasing the fee to request expedited
examination of a design application to $1,600 for a large entity. This
fee was introduced at a fee rate of $900 in November 2000. The Office
is increasing the fee for the first time since its inception.
Expedited examination is available to all design applicants who
first conduct a preliminary examination search and file a request for
expedited treatment accompanied by a fee for the expedited treatment
and handling (37 CFR 1.17(k)) in addition to the required filing,
search, and examination fees. This cost-based expedited treatment
fulfills a particular need by affording rapid design patent protection
that may be especially important where marketplace conditions are such
that new designs on articles are typically in vogue for limited periods
of time. The Office notes that the unit cost presented for this service
only accounts for the initial processing of the request and does not
include additional resources expended. The applications are
individually examined with priority, and the clerical processing is
conducted and/or monitored by specially designated personnel to achieve
expeditious processing through initial application processing and the
design examining group. For a patentable design application, the
expedited treatment is a streamlined filing-to-issuance procedure. This
procedure further expedites design application processing by decreasing
clerical processing time as well as the time spent routing the
application between processing steps. Specially designated personnel
are required to conduct and/or monitor the expedited clerical
processing. Also, expedited design applications may be individually
treated throughout the examination process where necessary for
expedited treatment, whereas normally, the search phase of design
application examination is conducted in groups.
For the first few years following the introduction of this program,
requests for expedited examination of a design application were less
than 1 percent of total design filings. In recent years, requests have
increased to over 2 percent of total filings. As discussed in the NPRM,
the increase in demand for this service forced the Office to choose to
cap the program (i.e., impose limits on the number of expedited
examinations it will undertake in a given fiscal year), end the
program, or increase the fee. Increasing this optional fee will allow
the USPTO to better manage staffing to match the demand for this
service, while still keeping the service available as an option for
those who may benefit from this program. The USPTO believes that this
new fee amount, as well as the associated small and micro entity
discounts, will provide the Office the ability to continue offering
this service to applicants.
(c) Utility and Reissue Patent Issue and Maintenance Fees
[[Page 46944]]
Table 5--Utility and Reissue Patent Issue and Maintenance Fees--Fee Changes and Unit Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Final rule Percentage
Current fees fees large Dollar change change large FY 2018 FY 2019
Fee description large (small) (small) large (small) (small) unit cost unit cost
[micro] entity [micro] entity [micro] entity [micro] entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Utility issue fee............................................... $1,000 $1,200 +$200 +20 $325 $319
($500) ($600) (+$100) (+20)
[$250] [$300] [+$50] [+20]
Reissue issue fee............................................... $1,000 $1,200 +$200 +20 325 319
($500) ($600) (+$100) (+20)
[$250] [$300] [+$50] [+20]
For maintaining an original or any reissue patent, due at 3.5 $1,600 $2,000 +$400 +25 n/a n/a
years.......................................................... ($800) ($1,000) (+$200) (+25)
[$400] [$500] [+$100] [+25]
For maintaining an original or any reissue patent, due at 7.5 $3,600 $3,760 +$160 +4 n/a n/a
years.......................................................... ($1,800) ($1,880) (+$80) (+4)
[$900] [$940] [+$40] [+4]
For maintaining an original or any reissue patent, due at 11.5 $7,400 $7,700 +$300 +4 n/a n/a
years.......................................................... ($3,700) ($3,850) (+$150) (+4)
[$1,850 [$1,925] [+$75] [+4]
--------------------------------------------------------------------------------------------------------------------------------------------------------
The Office is adjusting the issue fees by 20 percent and first
stage maintenance fees by 25 percent. These adjustments will mark the
first time maintenance fee rates have changed since 2013. The total
package of fees in this Final Rule does not significantly impact the
balance between front-end and back-end fees. The USPTO continues to set
front-end fees below the cost to the Office to provide those services
in order to encourage innovation. Front-end fees for a utility patent
with one RCE and lifetime maintenance will continue to be about 18
percent of the total fees paid over the life of a patent (see Table 6).
However, as certain technology lifecycles grow shorter, it is important
that the USPTO not rely too heavily on fees paid late in the life of a
patent. Therefore, the Office is slightly rebalancing the back-end fees
to recover the initial search and examination costs earlier in the life
of the patent.
Table 6--Front-End and Back-End Fee Balance
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current Final rule
------------------------------------------------------------------------------
Fee group Fee title Group's Group's
Large Percent of percent of Large Percent of percent of
entity fee total total entity fee total total
--------------------------------------------------------------------------------------------------------------------------------------------------------
Front-End Fees............................ Filing....................... $300 2 18 $320 2 18
Search....................... 660 4 700 4
Examination.................. 760 4 800 4
1st RCE...................... 1,300 8 1,360 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
Back-End Fees............................. Issue........................ 1,000 6 16 1,200 7 18
1st Stage Maintenance........ 1,600 10 2,000 11
-------------------------------------------------------------------------------------------------------------
2nd Stage Maintenance........ 3,600 22 66 3,760 21 64
3rd Stage Maintenance........ 7,400 44 7,700 43
------------------------------------------------------------------------------
Total................................. 16,620 100 100 17,840 100 100
--------------------------------------------------------------------------------------------------------------------------------------------------------
The issue fee for utility and reissue patents is increasing from
$1,000 to $1,200, and the first stage maintenance fee is increasing
from $1,600 to $2,000. As a result, the combined fees paid for issue
and first stage maintenance is increasing from 16 percent to 18 percent
of the total fees paid for a utility patent with one RCE and lifetime
maintenance.
However, second and third stage maintenance fees are only
increasing by 4 percent--less than the across-the-board adjustment--
with second stage increasing from $3,600 to $3,760 and third stage
increasing from $7,400 to $7,700.
The Office determined elasticity estimates for the three
maintenance payments for both large and small entities. For all point
estimates and confidence intervals, maintenance fees were found to be
inelastic, with the first stage being the least elastic of these fees.
More detailed information on elasticity estimates can be found at
https://www.uspto.gov/FeeSettingAndAdjusting in the document entitled
``Setting and Adjusting Patent Fees during Fiscal Year 2020--
Description of Elasticity Estimates.''
(d) AIA Trial Fees
[[Page 46945]]
Table 7--AIA Trial Fees--Fee Changes and Unit Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Final rule Percentage
Current fees fees large Dollar change change large FY 2018 FY 2019
Fee description large (small) (small) large (small) (small) unit cost unit cost
[micro] entity [micro] entity [micro] entity [micro] entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Inter partes review request fee--Up to 20 claims................ $15,500 $19,000 +$3,500 +23 $15,016 $17,887
Inter partes review post-institution fee--Up to 15 claims *..... 15,000 n/a n/a n/a 25,490 27,376
Inter partes review post-institution fee--Up to 20 Claims *..... n/a 22,500 n/a n/a n/a n/a
Inter partes review request of each claim in excess of 20....... 300 375 +75 +25 n/a n/a
Inter partes post-institution request of each claim in excess of 600 n/a n/a n/a n/a n/a
15 *...........................................................
Inter partes post-institution request of each claim in excess of n/a 750 n/a n/a n/a n/a
20 *...........................................................
Post-grant or covered business method review request fee--Up to 16,000 20,000 +4,000 +25 21,465 26,296
20 claims......................................................
Post-grant or covered business method review post-institution 22,000 n/a n/a n/a 29,842 40,791
fee--Up to 15 claims *.........................................
Post-grant or covered business method review post-institution n/a 27,500 n/a n/a n/a n/a
fee--Up to 20 claims *.........................................
Post-grant or covered business method review request of each 375 475 +100 +27 n/a n/a
claim in excess of 20..........................................
Post-grant or covered business method review post-institution 825 n/a n/a n/a n/a n/a
request of each claim in excess of 15 *........................
Post-grant or covered business method review post-institution n/a 1,050 n/a n/a n/a n/a
request of each claim in excess of 20 *........................
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The post-institutional threshold for paying claims fees will increase from 15 to 20.
On April 24, 2018, the U.S. Supreme Court issued its decision in
SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018). As required by the
decision, the PTAB will institute a trial as to all claims or none.
Previously, the PTAB instituted a trial on just some claims. This has
increased the amount of time spent per case post-institution. The
Office has also modified its pre-institution practice to take into
account the impacts of the SAS decision. For example, prior to SAS, the
PTAB did not generally address all arguments at institution. Post-SAS,
for purposes of deciding whether to institute trial on a petition, the
Office's policy is to provide details to the parties to the extent
practicable, including responding to arguments in a patent owner's
preliminary response that were not the basis for the decision whether
or not to institute. This has increased the amount of time spent per
case pre-institution. These changes related to the SAS decision have
increased the average cost to conduct each proceeding.
Other implementations, such as providing automatic sur-replies and
pre-hearing conferences, were made to help provide additional fairness
and certainty to the parties and public while continuing the PTAB's
practice of rendering high-quality decisions within the statutory time
limits applicable to AIA trial proceedings; however, these changes,
too, have increased the average cost of conducting each proceeding.
The post-institutional threshold for paying excess claim fees is
increasing from 15 to 20 claims so as to match the PTAB's request
threshold, reflecting the fact that, following the Supreme Court
decision in SAS, the PTAB is required to institute all claims or none.
The NPRM proposed fees based on the Office's best estimates at that
time, taking into consideration the cost increases already experienced,
plus future inflationary cost growth. Since then, the Office has
collected and analyzed the additional cost data available through the
end of FY 2019. In addition, the Office has taken into account
uncertainties resulting from changes in the way in which AIA trials are
conducted.
While the unit cost data (see Table 7) shows that post-institution
costs have increased more than pre-institution costs, pre-institution
costs have also increased. These costs have increased in response to
the Supreme Court's SAS decision, as discussed above.
In addition, in response to feedback from stakeholders, the Office
has modified its approach to concurrent petitions challenging the same
patent or patents in the same family filed by the same petitioner.
Specifically, the Board now considers whether to exercise its
discretion to limit the number of these parallel petitions that may, if
the threshold is met, be instituted. Similarly, the Board has
undertaken a closer review of petitions to determine whether they raise
issues that were considered by the examiner during ex parte prosecution
or during other proceedings before the Office. To evaluate these
requests the Board must make close comparisons between the challenges
to determine whether it should exercise its discretion and institute a
trial. Such comparisons require analyzing the prior art cited in the
petitions and evaluating the reasons given by the petitioners for
filing additional petitions. As this development in AIA trial practice
is relatively recent (within the last 12 months), the Office does not
yet have an accurate model to predict how many requests it will receive
and how much additional effort will be necessary to evaluate them. To
account for these uncertainties, it is necessary to set the pre-
institution fees for inter partes reviews at $19,000. This 23 percent
increase is less than the 25 percent increase proposed in the NPRM but
above the FY 2019 unit cost. The pre-institution fee is set at more
than the FY 2019 unit cost to take into account the uncertainties
outlined above that arose
[[Page 46946]]
in that year and are expected to continue in FY 2020 and beyond.
The post-institution fee is set to $22,500 for inter partes review,
which is above the increase proposed in the NPRM but considerably lower
than the FY 2019 actual unit cost. As a result of the SAS and Arthrex
Inc. v. Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019) decisions,
there has been an increase in the number of remands to the PTAB, which
has increased the post-institution amount of work and costs. At this
time, it remains unclear whether the post-institution costs will remain
at the current level or decrease after the SAS and Arthrex remands have
been fully addressed. Accordingly, the post-institution fee is set
above the proposed NPRM fee, which is above the pre-SAS FY 2017 unit
costs but below the post-SAS FY 2019 unit costs. The Office continues
to evaluate the data as it becomes available to better understand the
long-term impact of SAS on post-institution costs.
Post-grant review and covered business method review fees will be
maintained at the rates proposed in the NPRM, at $20,000 for pre-
institution and $27,500 for post-institution. These fee rates are above
the respective inter partes review fees, due to the additional work
involved with post-grant and covered business method reviews, but below
the FY 2019 actual unit costs for post-grant reviews and covered
business method reviews due to uncertainties about future costs.
Specifically, post-grant reviews and covered business method reviews
may raise additional issues beyond those raised in inter partes
reviews, such as patent eligibility, written description, enablement,
indefiniteness, and public use. Further, given the additional issues
that may be raised, post-grant reviews and covered business method
reviews provide 33 percent higher word limits for petitions, patent
owner responses, and preliminary responses. While the actual unit costs
for post-grant and covered business method reviews have typically been
higher than the unit costs for inter partes reviews for these reasons,
it is harder to determine the precise cost of post-grant and covered
business method reviews. Due to a relatively small number of trials
(approximately 60 post-grant reviews or covered business method reviews
annually), the data on actual unit costs can vary from year to year.
Therefore, it is unclear whether the post-SAS costs will remain at the
current levels. The Office will continue to evaluate data as it becomes
available to better understand the long-term impact of SAS on post-
grant review and covered business method review costs.
This rulemaking will help the PTAB continue to maintain the
appropriate level of judicial and administrative resources to continue
to provide high-quality and timely decisions for AIA trials.
(2) New Fees
(a) Non-DOCX Filing Surcharge Fee
Table 8--Non-DOCX Filing Surcharge Fee--Fee Changes and Unit Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Final rule Percentage
Current fees fees large Dollar change change large FY 2018 FY 2019
Fee description large (small) (small) large (small) (small) unit cost unit cost
[micro] entity [micro] entity [micro] entity [micro] entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Surcharge--non-DOCX filing...................................... New $400 +$400 n/a n/a n/a
($200) (+$200) (n/a)
[$100] [+$100] [n/a]
--------------------------------------------------------------------------------------------------------------------------------------------------------
The Office is implementing a new fee for utility non-provisional
applications filed under 35 U.S.C. 111 and submitted in a format other
than DOCX (structured text). This surcharge applies to filings that are
submitted in an electronic document, such as a PDF, that is not saved
in the DOCX format. It also applies to filings that are submitted non-
electronically, in addition to the existing paper filing surcharge. The
surcharge is being introduced for specifications, claims, and
abstracts. The submission in DOCX format will facilitate improvements
in the efficiency of patent operations. After careful consideration of
public comments, the Office has decided to delay the implementation of
the non-DOCX filing surcharge, and it will become effective on January
1, 2022. Over the next several months, the Office will continue with
its outreach efforts, addressing customer concerns and providing ample
time for applicants to transition to this new process.
Using EFS-Web, anyone with a web-enabled computer can file patent
applications and documents without downloading special software or
changing document preparation tools and processes. Registering as an
EFS-Web eFiler allows enhanced filing, follow-on processing, saved
submissions, and more. EFS-Web registered eFilers have been able to
file specification, abstract, and claims in DOCX for utility non-
provisional filings since August 2017.
Launched in 2015, the eCommerce Modernization (eMod) Project aims
to improve the electronic application process for patent applicants by
modernizing the USPTO's filing and viewing systems. Recent improvements
include implementing structured text functionalities. Structured text
allows applicants to more easily submit their documents as text-based
documents rather than having to create PDF documents. This streamlines
the application and publication processes. The Office tested the
capabilities of structured text within EFS-Web and PAIR with the eMod
Text Pilot Program, which ran from August 2016 until September 2017.
The pilot was successful, and many improvements were made based on
feedback from applicants, including independent inventors, law firms,
and corporations. Structured text features are now available to all
EFS-Web-registered and Private PAIR users and give applicants the
ability to file structured text via EFS-Web and access structured text
submissions, structured text Office actions, and Extensible Markup
Language (XML) downloads via Private PAIR. Additional information can
be found in the associated DOCX quick start guide available on the
USPTO website, https://www.uspto.gov/patents-application-process/checking-application-status/quick-start-guides. For more information on
filing in DOCX, please visit https://www.uspto.gov/patent/docx.
To encourage the filing of more applications in structured text,
the required fee surcharge applies to application filings that do not
include the specification, claims, and abstract in DOCX format. This
will accelerate the
[[Page 46947]]
adoption of DOCX to realize a variety of benefits. Both the USPTO and
applicants will see increased efficiencies, over the lifetime of an
application, from encouraging DOCX filings. Based on a USPTO survey,
over 80 percent of applicants author their patent applications in DOCX
in the normal course of business. Filing in structured text allows
applicants to submit their specifications, claims, and abstracts in
text-based format and eliminates the need to convert structured text
into a PDF for filing. Applicants can access examiner Office actions in
text-based format, which makes it easy to copy and paste when drafting
responses. The availability of structured text also improves
accessibility for sight-impaired customers who use screen reading
technology.
DOCX filing provides opportunities to increase efficiency in the
Office. It enables the development of software to provide automated
initial reviews of applicant submissions to help reduce the effort
required by the Office. The automated reviews can tell applicants up
front if potential problems exist and allow them to make changes prior
to or at the time of submission. This also improves validation based on
content, such as claims validation for missing claim numbering or
abstract validation for word count and paragraph count.
Increased DOCX filing will also lead to higher data quality by
reducing system conversion errors. It provides a flexible format with
no template constraints. It also improves data quality by supporting
original formats for chemical formulas, mathematical equations, and
tables. DOCX filing also improves document identification by automatic
detection, allows for greater reuse of content, and provides improved
searching for patent applications and submissions. The originally
submitted structured text document is available in Private PAIR,
allowing easy retrieval of original DOCX files.
Structured text usage also helps streamline the application process
and provides benefits for the USPTO. The Office converts image-based
filings (e.g., PDF documents) into text-based format for internal
processing. Text-based filings will allow the Office to skip this time-
consuming and costly step. Optical character recognition (OCR) of
image-based filings costs the Office approximately $3.15 per new
submission. In addition to the initial submission, the use of image-
based PDFs incurs many costs over the lifetime of an application. There
are large costs associated with the USPTO's systems and personnel--from
pre-examination, examination, and publication--due to the need to apply
OCR to convert image-based PDFs into structured text that can be
leveraged by downstream systems. The surcharge is applied not only to
account for these inefficiencies, but also to address rising expenses.
Encouraging text-based filings will decrease the Office's costs. If, in
the future, the program were extended to additional application
documents besides specifications, claims, and abstracts, the potential
savings could reach as much as $9.0 million annually.
XML generated from DOCX files complies with the international World
Intellectual Property Office (WIPO) Standard ST.96 from intake through
display and use in examination tools. Receiving filings through
structured text makes documents automatically available to examiners in
almost real-time. DOCX filing also improves examination consistency by
using automated tools to analyze text, increases the accuracy of
examiner formalities reviews and tools (i.e., claims tree generators
and document comparison), and improves results in automated pre-search
and future analytics (i.e., section 112(b) and (f) evaluations) by
using text supplied by applicants. DOCX submission contributes to the
USPTO's plan to begin the automation of publication processes, which
will lead to large cost reductions in the production of patent
artifacts (grants and pre-grant publications), and contributes to the
USPTO's plan to begin the automation of processes to assist in
formalities reviews, classification, and routing, which leads to
improved patent quality, reduced pendency, and greater consistency.
(b) Pro Hac Vice Fee
Table 9--Pro Hac Vice Fee--Fee Changes and Unit Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Percentage
Current fees Final rule fees Dollar change change large FY 2018 FY 2019
Fee description large (small) large (small) large (small) (small) [micro] unit cost unit cost
[micro] entity [micro] entity [micro] entity entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Fee for non-registered practitioners to appear before the New $250 +$250 n/a n/a n/a
Patent Trial and Appeal Board............................
--------------------------------------------------------------------------------------------------------------------------------------------------------
In this Final Rule, the Office is implementing a fee to appear pro
hac vice in an AIA trial proceeding. The non-registered practitioner
fee is for each proceeding that a non-registered practitioner requests
admission to practice. If a non-registered practitioner requests
admission to multiple AIA trial proceedings, multiple requests and fees
will be required, one for each proceeding. Once a request is granted,
the counsel is admitted for the entire duration of a proceeding, which
may extend for several years, (e.g., when an inter partes review
proceeds to final written decision, and, after appeal to the Federal
Circuit, is remanded back to the PTAB for further proceedings). By
instituting the pro hac vice fee, the Office will be able to shift the
cost of the service of processing these requests from the overall AIA
trial fees to the requesting, non-USPTO registered counsel.
(c) Annual Active Patent Practitioner Fee
In the NPRM, the USPTO proposed a new fee called the annual active
patent practitioner fee, and an associated fee structure, under 37 CFR
1.21 and 11.8, so that patent practitioners, who directly benefit from
registration, would bear the costs associated with maintaining the
integrity of their profession, including the costs of OED's register
maintenance and disciplinary functions. The fee collections were
proposed to shift the costs of the services OED provides patent
practitioners in administering the disciplinary system and register
maintenance from patent applicants and owners to the patent
practitioners. The annual active patent practitioner fee was proposed
to be $340, with a $100 annual fee discount for those who certified
completion of a certain number of CLE. In addition, the Office proposed
that registered practitioners who are endorsed on the register as
voluntarily
[[Page 46948]]
inactive would be liable for a fee of $70 per year to cover OED's
administrative costs in maintaining the register and updating their
information. Finally, a new emeritus status was proposed for active
patent practitioners who have been registered for ten or more years to
elect emeritus status, subject to certain conditions.
However, during the public comment period, the USPTO received a
number of comments expressing concerns over the proposed new fee.
Having further considered the public feedback on this proposal, the
USPTO has determined that it will not at this time implement the annual
active patent practitioner fee, the proposed new voluntarily inactive
fee, or the proposed emeritus status. The Office continues to recognize
the value of CLE in maintaining and enhancing patent practitioners'
legal skills. In addition, the Office recognizes that it is beneficial
to provide information regarding a registered practitioner's CLE status
to the public. Thus, while completion of CLE remains voluntary, the
USPTO intends to recognize patent practitioners who certify completion
of six hours of CLE in the preceding 24 months, including five hours of
patent law and practice and one hour of ethics credit, in the online
practitioner directory. In the near future, the USPTO intends to issue
proposed CLE guidelines, with a request for public comment on them. It
is anticipated that the proposed guidelines will address the types of
CLE courses that may qualify for recognition and the form of
recognition for patent practitioners who certify that they have
completed the CLE.
Registration Statement
Although the USPTO is not implementing the annual active patent
practitioner fee in this Final Rule, the Office intends to communicate
with practitioners on a periodic basis for register maintenance. Thus,
biennially, registered practitioners, as well as individuals granted
limited recognition under 37 CFR 11.9(b), will be required to file a
registration statement with the OED director. Notice will be provided
to patent practitioners at least 120 days in advance of the due date
for the filing of the registration statement, electronically, through
the USPTO's online system. The registration statement takes the place
of the practitioner survey, which is administered on paper. The USPTO
anticipates that patent practitioners will first be required to submit
a registration statement in the spring of 2022. Registered
practitioners will not be required to pay any fee at the time the
registration statement is filed.
Failure to file the registration statement by the due date may
result in the registered practitioner being subject to a delinquency
fee and possible administrative suspension, as was the case for a
patent practitioner who failed to respond to the practitioner survey.
Specifically, if a registered practitioner, or a person granted limited
recognition pursuant to 37 CFR 11.9(b), fails to file the registration
statement by the due date, the OED director will publish and send a
notice to the registered practitioner advising them of the failure to
file the registration statement, the consequence of being
administratively suspended, and the requirements for reinstatement. The
notice will request filing of the registration statement within 60 days
after the date of such notice.
If a patent practitioner fails to comply with the notice within the
time allowed, the OED director will then publish and send to the
practitioner a Rule to Show Cause why his or her registration or
recognition should not be administratively suspended. The OED director
shall file a copy of the Rule to Show Cause with the USPTO director.
The practitioner will be given 30 days from the date of the Rule to
Show Cause to file a response with the USPTO director. The response
should address any factual and legal bases why the practitioner should
not be administratively suspended. Within 10 days of receiving a copy
of the response, the OED director may file a reply with the USPTO
director. The USPTO director will enter an order either dismissing the
Rule to Show Cause or administratively suspending the practitioner. The
aforementioned is the same procedure currently used when a registered
practitioner fails to timely respond to the practitioner survey.
Reinstatement
The sections referring to reinstatement from administratively
inactive status remain unchanged from the current regulations. The
reinstatement sections relating to other statuses are set forth below.
Administratively Suspended
Under this Final Rule (37 CFR 11.11(f)(1)), any registered
practitioner, or person granted limited recognition, who has been
administratively suspended for less than five years may be reinstated
on the register provided the patent practitioner is not a party to a
disciplinary proceeding. Thus, the Final Rule eliminates the
requirement that a registered practitioner who is administratively
suspended for more than two years (but less than five years) take and
pass the registration examination in order to be reinstated. To apply
for reinstatement, the practitioner will need to submit an application
form supplied by the OED, demonstrate compliance with the provisions of
Sec. 11.7(a)(2)(i), submit a declaration or affidavit attesting to the
fact that the practitioner has read the most recent revisions of the
patent laws and the rules of practice before the Office, and pay the
fees set forth in Sec. 1.21(a)(9)(i) and (ii).
However, under this Final Rule, any administratively suspended
registered practitioner or person granted limited recognition who seeks
reinstatement more than five years after the effective date of
administrative suspension, also shall be required to file a petition to
the OED director requesting reinstatement and providing objective
evidence that they continue to possess the necessary legal
qualifications to render valuable service to patent applicants. The
objective evidence may include taking and passing the registration
examination.
Resigned
Any registered practitioner who has been resigned for less than
five years may be reinstated on the register provided the practitioner
is not the subject of a disciplinary investigation or a party to a
disciplinary proceeding. Thus, the Final Rule eliminates the
requirement that a registered practitioner who was resigned for more
than two years (but less than five years) take and pass the
registration examination in order to be reinstated. To apply for
reinstatement, the practitioner will need to submit an application form
supplied by the OED, demonstrate compliance with the provisions of
Sec. 11.7(a)(2)(i), submit a declaration or affidavit attesting to the
fact that the practitioner has read the most recent revisions of the
patent laws and the rules of practice before the Office, and pay the
fees set forth in Sec. 1.21(a)(9)(i) and (ii).
However, under this Final Rule any registered practitioner who
seeks reinstatement after having been in resigned status for five years
or more also shall be required to file a petition to the OED director
requesting reinstatement and providing objective evidence that they
continue to possess the necessary legal qualifications to render
valuable service to patent applicants. The objective evidence may
include taking and passing the registration examination.
[[Page 46949]]
C. Discontinued Fees
This section describes fees that are being discontinued. The
purpose of this action is to help streamline the patent fee schedule
while also focusing USPTO workforce efforts on producing products that
benefit the general public rather than producing outputs for individual
customers.
Table 10--Discontinued Fees
--------------------------------------------------------------------------------------------------------------------------------------------------------
Final rule Percentage
Current fees fees large Dollar change change large FY 2018 FY 2019
Fee description large (small) (small) large (small) (small) unit cost unit cost
[micro] entity [micro] entity [micro] entity [micro] entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Copy of Patent Technology Monitoring Team (PTMT) patent $50 Discontinued -$50 n/a n/a n/a
bibliographic extract and other DVD (optical disc) (currently
at Sec. 1.19(j)).............................................
Copy of U.S. patent custom data extracts (currently at Sec. 100 Discontinued -$100 n/a n/a n/a
1.19(k)).......................................................
Copy of selected technology reports, miscellaneous technology 30 Discontinued -30 n/a n/a n/a
areas (currently at Sec. 1.19(l))............................
For USPTO-assisted recovery of ID or reset of password for the 70 Discontinued -70 n/a 15 18
Office of Enrollment and Discipline Information System
(currently at Sec. 1.21(a)(6)(i))............................
--------------------------------------------------------------------------------------------------------------------------------------------------------
In January 2018, to comply with Executive Order 13681 (Improving
the Security of Consumer Financial Transactions), select computer
service fees were discontinued and the services made free. The three
changes to the fees at 37 CFR 1.19 follow that trend. The service fees
in Sec. 1.19 will be eliminated, and the Office will instead provide
these services in a slightly modified form (i.e., electronic) for free.
The first fee being discontinued is the current 37 CFR 1.19(j) fee
for a copy of the Patent Technology Monitoring Team (PTMT) patent
bibliographic extract and other DVDs. PTMT patent bibliographic data is
currently available online for free, curtailing the need for the USPTO
to send out extracts on disc.
The second fee being discontinued is the current 37 CFR 1.19(k) fee
for a copy of U.S. patent custom data extracts. With the elimination of
this service fee, the USPTO will create the common customizations and
release them online, free to the public, at the same time the data is
released. Further customizations will be discontinued. Additionally,
PatentsView (http://www.patentsview.org), while not an official USPTO
data source, meets many of the needs of those requesting custom data
extracts at no charge to the consumer.
The third fee being discontinued is the current 37 CFR 1.19(l) fee
for a copy of selected technology reports in miscellaneous technology
areas. Selected technology reports are currently available online for
free, curtailing the need for the USPTO to send out paper copies of the
reports.
Upon consideration of public comments, a fourth fee being
discontinued is the fee for the USPTO-assisted recovery of ID or reset
of password for the Office of Enrollment and Discipline Information
System. This fee is being removed, as it is unnecessary.
VI. Discussion of Comments
Comments and Responses
The USPTO published a proposed rule on July 31, 2019, soliciting
comments on the proposed fee schedule. In response, the USPTO received
comments from four intellectual property organizations and 40
individuals, attorneys, law firms, corporations, and other
associations. These comments are posted on the USPTO's website at
https://www.uspto.gov/FeeSettingAndAdjusting.
The summaries of comments and the Office's responses to the written
comments follow.
General Fee Setting Approach
Comment 1: One commenter stated support for the proposed patent fee
schedule. The commenter noted that the USPTO must continue to focus on
reducing pendency and backlogged applications. Increased fees result in
increased revenues, which allow for additional examiners to be hired.
The commenter expressed that an increase in funding for examining
allows applications to be processed faster and reduces the current
backlog. Further, the focus on increasing up-front fees allows the
USPTO to collect fees for the most cost-intensive operations.
Response: The USPTO appreciates the feedback from the commenter and
is committed to achieving the goals developed in consultation with the
stakeholder community as set forth in the Strategic Plan. The USPTO has
carefully considered the balance of front-end and back-end fees. In
this Final Rule, the balance between front-end and back-end fees is not
significantly impacted. However, as certain technology lifecycles grow
shorter, it is important that the USPTO not rely too heavily on fees
paid late in the life of a patent. Therefore, the Office is slightly
rebalancing the fees to recover the initial search and examination
costs earlier in the life of the patent.
Comment 2: Several commenters expressed support for the Office's
work to ensure adequate funding. They are supportive of the goals of
this fee setting, especially recovering aggregate estimated costs of
patent operations and optimizing patent timeliness and quality.
Response: The USPTO appreciates the feedback from the commenter and
is committed to pursuing the goals in the Strategic Plan in a fiscally
responsible manner.
Comment 3: One commenter expressed support for the operating
reserve, its goals, and the detailed supporting information contained
in the NPRM.
Response: The USPTO appreciates the feedback from the commenter.
The operating reserve is an important tool that helps mitigate
financial and operational risks and facilitate execution of multi-year
plans in order to achieve the goals set forth in the Strategic Plan.
The operating reserve also allowed the USPTO to remain open
[[Page 46950]]
and operational during the 35-day lapse in appropriations during FY
2019.
Comment 4: One commenter stated that the USPTO should continue to
prioritize patent quality, and if fee increases are needed, the
increased resources should be devoted to ensuring examiners receive the
time and resources they need to assess each application and all the
relevant prior art. The commenter noted it is important that patent
policy be crafted to limit the possibility that low-quality patents get
in the way of technical and economic progress.
Response: The Office's strategic goal to optimize patent quality
and timeliness recognizes the importance of innovation as the
foundation of American economic growth and competitiveness. Through
this goal, the Office diligently works to balance timely examination
with improvements in patent quality, particularly the reliability of
issued patents. Based on assumptions and estimates found in the FY 2021
Budget, the fee schedule in this Final Rule will recover the aggregate
estimated costs of patent operations, including achieving the Office's
strategic goals.
Comment 5: One commenter suggested that the Office consider phasing
in fee increases to provide patentees adequate time to prepare for and
adapt to the increased costs.
Response: The Office realizes that higher fees will affect budgets.
In the same way, the USPTO is experiencing an increase in aggregate
costs, and the fee increases are necessary in order to deliver on the
priorities listed in the Strategic Plan. The Office notes the time
frame associated with the fee setting process inherently provides for
the phasing in of fee changes. For example, this fee setting process
began with a proposal presented to the PPAC in August 2018, and the fee
schedule in this Final Rule will not take effect until fall 2020, with
the non-DOCX filing surcharge effective January 2022. As part of the
fee setting process, the public had two opportunities to review and
comment on the fee proposals. The public and PPAC feedback allowed the
USPTO to refine the fee proposal in both the NPRM and this Final Rule.
Comment 6: One commenter noted stakeholder concerns about the
increasing uncertainty of patent rights and encouraged the USPTO to
carefully consider whether excessive fee increases might have the
unintended consequence of discouraging filings.
Response: The Office appreciates the commenter's concern and
carefully considered the fee schedule in this Final Rule. The Office
undertook an elasticity analysis (i.e., an assessment of the degree to
which changes in fee rates may affect demand for services) as part of
this rulemaking, and a description of elasticity estimates can be found
at https://www.uspto.gov/FeeSettingAndAdjusting.
Comment 7: One commenter expressed support for the reduction in
fees based on organization size.
Response: The USPTO appreciates the feedback from the commenter and
is committed to providing, as allowed by statute, fee reductions for
small and micro entity innovators to facilitate access to the patent
system.
Comment 8: Multiple commenters noted the need for the USPTO to
consider smaller entities when raising fees. Some noted that fee
increases are prohibitive for pro se inventors, small entities, and
micro entities and feel they will be disproportionately affected by
these fee increases.
Response: The USPTO appreciates the concern about increasing fees.
For small businesses and individual filers, the fees for small and
micro entity rates are tiered, with small entities at a 50 percent
discount and micro entities receiving a 75 percent discount on the fees
for filing, searching, examining, issuing, appealing, and maintaining
patent applications and patents. Small or micro entity discounts are
available for those who are eligible in 86 of the 125 large entity fee
rates being set or adjusted in this Final Rule.
Comment 9: One commenter requested that the USPTO carefully
consider whether further reductions in the fees are possible for small
entities, and especially micro entities, while maintaining the
legitimate goals articulated in the fee proposal. Similarly, another
commenter suggested that, instead of increasing the fees, the USPTO
could provide more financial assistance to individual inventors who can
prove their individual inventor status.
Response: The Office does not have the legal authority to provide
further reductions in the fees for small and micro entities or to
provide direct financial assistance. However, the USPTO notes that
under the fee structure included in this Final Rule, an indirect
financial assistance to small and micro entities is provided in the
form of subsidizing the cost of patent application prosecution. For
example, the costs to the Office, from filing through issue, exceed the
fees paid by a micro entity who maintains a patent through the full
term. Further, small entity fees only cover the costs to the Office if
a patent is maintained for the full term. Therefore, maintenance fees
paid by large entity patentees and small entity patentees who maintain
their patent for a full term are used in part to subsidize the filing,
search, and examination costs for all applicants, including small and
micro entities.
Comment 10: One commenter questioned what the Office could do to
encourage greater participation by small and micro entities in
obtaining and maintaining patents.
Response: Helping small businesses and independent inventors with
limited resources is important to the USPTO. It has several free or
reduced fee programs to assist independent inventors and small
businesses in securing patent protection for their inventions, such as
the Patent Pro Bono Program, Pro Se Assistance Program, and Law School
Clinic Certification Program. More information on these programs can be
found on the USPTO website:
https://www.uspto.gov/ProBonoPatents
https://www.uspto.gov/ProSePatents
https://www.uspto.gov/LawSchoolClinic
Another advantage that the USPTO offers for small and micro
entities is reduced fees. An applicant who meets the micro entity
requirements is eligible for a 75 percent reduction on most fees, and
small entity status offers a 50 percent fee reduction.
Comment 11: One commenter stated that it is important to keep
barriers to entry (fees) low enough that startups can obtain patents
(e.g., application and examination fees), maintain them (e.g.,
maintenance fees), and challenge others' low-quality patents that
should not have been issued in the first place (e.g., AIA trial fees).
The commenter stated it is essential for startups to be able to reap
the benefits at each stage.
Response: The USPTO agrees that it is important to keep front-end
fees low enough so as not to prevent entry into the patent system. The
USPTO also designs the fee structure so that fees to obtain and
maintain a granted patent increase only as the age of the patent
increases to minimize the financial impact early in the life of a
patent application or patent. In this Final Rule, the balance between
front-end and back-end fees is not significantly impacted. The USPTO
continues to set front-end fees below the cost to the Office to provide
those services, in order to encourage innovation. While this Final Rule
increases the issue and first stage maintenance fees, the fee schedule
continues to maintain those fees below second stage maintenance fees
and keeps the balance of front-end and back-end fees substantially the
same. The
[[Page 46951]]
USPTO also maintains small and micro entity discounts for the fees for
filing, searching, examining, issuing, appealing, and maintaining
patent applications and patents.
Comment 12: One commenter suggested that the Office should reduce
the cost of filing certain patent applications by allowing an applicant
to defer payment of some fees without penalty.
Response: In the future, the USPTO may consider changes to the
timing of fee payments for search and examination. Currently, however,
except for provisional applications, each application for a patent
requires the appropriate search and examination fees in addition to the
patent application filing fees. Deferring payment of some fees would
require a large enough operating reserve to sustain operations during
the period in which fee collections would be lower due to the delayed
payment of fees. The adjusted fee schedule set forth in this rulemaking
will help replenish and grow the patent operating reserve to position
the USPTO for future changes, such as those suggested by the commenter.
Comment 13: One commenter noted the USPTO's tendency to follow or
align with patent practices in other countries, in fee structure and
other aspects of the patent system. The commenter hopes the leaders and
government agencies of our country are aware of the long-term
consequences of the actions they take.
Response: The Office and the administration carefully analyze all
policy decisions before implementation. This includes considering best
practices of other countries' IP systems. When appropriate, the Office
may implement practices similar to other national IP offices.
Changes to policies are considered after public comments have been
reviewed and a cost-benefit analysis has been performed (Regulatory
Impact Analysis). Enactment of policy change occurs if generally
supported by public comment and the corresponding cost-benefit analysis
displays a positive, long-term impact.
Across-the-Board Adjustment to Patent Fees
Comment 14: One commenter stated the fee increase should only
reflect a cost-of-living increase to keep pace with inflation.
Response: The USPTO appreciates the concern about rising fees and
continuously evaluates its processes and costs to ensure the Office is
achieving the optimal value from the resources used to carry out
operations. Despite that, the USPTO must adjust fees to recover the
aggregate estimated cost to the Office for processing, activities,
services, and materials relating to patents, including cost-of-living
increases and administrative costs of the Office with respect to such
patent fees over a multi-year period.
Comment 15: One commenter expressed that the fee for the USPTO-
assisted change of address should be eliminated.
Response: The USPTO would like to remind customers that they are
able to perform this process online as a self-service option free of
charge. The change of address fee is only charged if it is requested
that the USPTO perform this task instead of the customer utilizing the
self-service options. The USPTO is not targeting this fee for a
specific increase. Instead, this fee is increasing as part of the group
of fees subject to the 5 percent across-the-board adjustment to patent
fees. This fee was set in a previous rulemaking, and that structure is
not changed in this Final Rule.
Comment 16: One commenter expressed that the fee for the USPTO-
assisted recovery of ID or reset of password should be eliminated.
Response: The fee for USPTO-assisted recovery of ID or reset of
password for registered practitioners has been removed as unnecessary.
Comment 17: One commenter noted that the NPRM does not state a
rationale for the second and subsequent RCE fee to be different than
the RCE fee for a first request.
Response: The individual RCE fees were set at different amounts in
a previous rulemaking, the January 2013 Final Rule (which set forth the
rationale for the difference in those fees), and that structure is not
changed in this Final Rule. The USPTO is not targeting these fees for a
specific increase. Instead, the fees for RCEs--both for the first
request and for second and subsequent requests--are being adjusted by
the across-the-board adjustment to patent fees.
Comment 18: One commenter wrote that the increase in the second and
subsequent RCE fee would hurt small entity applicants and small entity
law firms. The Initial Regulatory Flexibility Analysis offered no
explanation justifying that differential effect on small entities.
Response: The USPTO is not targeting the RCE fees for a specific
increase. Instead, the fees for RCEs--both for the first request and
for the second and subsequent requests--are being adjusted by the
across-the-board adjustment to patent fees. The USPTO would like to
note that small and micro entity applicants will continue to receive
the small and micro entity discounts, which set the fee rates
significantly below cost to examine second and subsequent RCE filings.
Additionally, the Regulatory Flexibility Analysis analyzed applicants'
sensitivity to changes in fee rates by entity size, including RCE fees
for small entities. This impact is also included in the RIA completed
for this rulemaking, which is available at https://www.uspto.gov/FeeSettingAndAdjusting.
Comment 19: One commenter stated that the methodology for
calculating the unit cost for second and subsequent RCE filings is not
in the Activity Based Information and Patent Fee Unit Expense
Methodology document.
Response: The commenter can find this information in the ``Setting
and Adjusting Patent Fees during Fiscal Year 2020--Activity Based
Information and Patent Fee Unit Expense Methodology'' document, on page
22, before Table 2. ``Similarly, the same incremental approach is used
to determine the expense of the second and subsequent RCE. The two
scenarios presented to determine incremental expense for the second RCE
are slightly different than for the first RCE, but the same basic
method applies. The scenarios are: (1) The expense of a single
application that has already performed one RCE, and (2) the expense of
a single application that has completed a second RCE. All other
calculation methods remain the same.'' Additionally, the detail on the
exact calculations for FYs 2016, 2017, and 2018 can be found on page 41
of the ``USPTO Fee Unit Expense Calculation Detail'' document under the
heading ``Latest patent fee setting information.'' Both documents can
be found at https://www.uspto.gov/FeeSettingAndAdjusting.
Comment 20: One commenter suggested that the proposed fee for
submission of an information disclosure statement (IDS) is too high and
may discourage prompt disclosure of material references. The commenter
suggested that if the fee is increased, the Office could consider a
tiered rate structure with a discounted IDS fee for submitting an IDS
with fewer than five or 10 references, or below a certain page count
for non-patent literature.
Response: There is no fee for filing of an IDS if it is filed
before the mailing of a first Office action. The USPTO is not targeting
these fees for a specific increase. Instead, the fee for submission of
an IDS is increasing as part of the group of fees subject to the 5
percent across-the-board adjustment to patent fees that is being set to
help the USPTO
[[Page 46952]]
keep pace with inflationary cost increases. The single IDS fee was set
in a previous rulemaking, and that structure is not changed in this
Final Rule. The USPTO will consider the commenter's suggestions for
changes to the structure and fee amount for IDS fees for future fee
adjustments.
Comment 21: One commenter suggested the proposed increase to the
fee for extension of time for response within the first month is too
high. The commenter stated the increased fee makes it more difficult
for practitioners to provide a thorough response, especially for
complex issues where input and review may be required from multiple
inventors, licensees, and/or owners. The commenter indicated that the
need for extensions of time may be outside of the applicant's control
when extensions are required to maintain pendency after a response to a
final Office action.
Response: The Office recognizes that there are instances in which
an applicant would need to extend the time period for responding to an
Office action. However, an applicant may file a first after final reply
within two months of the final rejection to avoid some of the costs
associated with maintaining pendency after a reply to a final Office
action. The USPTO is not targeting these fees for a specific increase.
Instead, all fees for extensions of time for response are being
increased as part of the 5 percent across-the-board adjustment to
patent fees that are being set to help USPTO keep the pace with
inflationary cost increases. Differences in the rate of increase result
from rounding (the rounding rules are discussed in Part V: Individual
Fee Rationale, A. Across-the-Board Adjustment to Patent Fees).
Comment 22: One commenter suggested that increases in fees for
extensions of time for response will fall disproportionately on small
firms and solo practitioners. The commenter noted that fees for
extensions of time for response beyond the third month are greater than
the filing fees for a new application. The commenter believes that,
with essentially no cost to the USPTO, this appears to be a penalty,
not a reasonable fee increase.
Response: These fees were set in a previous rulemaking, and the
structure is not changed in this Final Rule. The USPTO is not targeting
these fees for a specific increase. Instead, the increase in fees for
extensions of time for response is part of the across-the-board
adjustment to patent fees that is being set to help the USPTO keep pace
with inflationary cost increases. Extension of time fees are intended
to encourage early submission of an applicant's response to facilitate
compact prosecution.
Comment 23: One commenter stated that the increases in the notice
of appeal fee and fee for forwarding an appeal in an application or ex
parte reexamination proceeding to the Board should take into account
the rate of reversal, in that the applicant should not bear the
entirety of the cost of what could be interpreted as an error made by
the Office.
Response: The Office appreciates the feedback. Regardless of the
outcome, the cost to render a decision on the appeal remains the same.
The Office has limited the increase in both the notice of appeal fee
and the fee for forwarding an appeal in an application or ex parte
reexamination proceeding to the Board to the 5 percent across-the-board
adjustment to patent fees. As a matter of policy, the Office has set
the combined notice of appeal and fee for forwarding an appeal in an
application or ex parte reexamination proceeding to the Board to less
than half of the unit cost for deciding an appeal.
Targeted Fee Adjustments
Maintenance Fee Surcharge
Comment 24: One commenter asked what information the USPTO had
about the use of the maintenance fee grace period and the consequences.
The commenter was concerned that higher fees could lead to greater
conflict possibilities between clients and attorneys. A commenter
suggested that the Office initiate procedures to notify patentees, by
United States Postal Service (USPS) mail and email to all registered
email addresses, of both the due date for the maintenance fees to be
paid and entrance into the grace period.
Response: The USPTO continuously monitors maintenance fee payments,
including payments made during the grace period. While over 95 percent
of maintenance fee payments are made in the six-month payment window
prior to the grace period, the Office does recognize that a patentee
may need the additional six-month grace period to make a decision on
renewing their patent rights. Therefore, the Office lowered the
proposed maintenance surcharge fee to $500 for large entities in the
NPRM, compared to the initial proposal of $1,000.
It is the responsibility of the patentee to ensure that maintenance
fees are paid in a timely manner to prevent the expiration of a patent.
Patentees are expected to maintain their own record and docketing
systems. The Office does provide some notices as reminders that
maintenance fees are due, but the notices, errors in the notices or in
their delivery, or the lack or tardiness of notices in no way relieve a
patentee from the responsibility to make timely payment of each
maintenance fee to prevent the patent from expiring by operation of
law. The notices provided by the Office are courtesies in nature and
intended to aid patentees. The Office's provision of notices in no way
shifts the burden of monitoring the time for paying maintenance fees on
patents from the patentee to the Office.
Comment 25: One commenter stated that those who delay payment of a
maintenance fee include small entities, micro entities, and independent
inventors, for whom the payment of a maintenance fee is often a
significant investment. Forcing such entities to pay a higher surcharge
fee does not appear to be justified in this circumstance.
Response: The Office recognizes that the maintenance fee surcharge
during the grace period affects small and micro entities as well as
independent inventors. The Office lowered the proposed maintenance fee
surcharge to $500 for large entities in the NPRM, compared to the
USPTO's initial proposal to PPAC of $1,000. Additionally, small and
micro entity discounts apply to the maintenance fee surcharge as well
as to the maintenance fees themselves.
Comment 26: One commenter noted that no cost to the public of the
six-month grace period was identified in the NPRM. Additionally, the
commenter noted that a competitor would still need to wait until the
expiration of the grace period to know that the maintenance fee has not
been paid.
Response: This rulemaking does not modify the maintenance fee grace
period, nor does it change the timeline for submitting maintenance fee
payments. The rulemaking simply adjusts the surcharge fee for
submitting a maintenance fee payment during the six-month grace period,
which provides patentees the option for an additional six months to
submit maintenance fee payments. It is not anticipated that this fee
adjustment will have a significant impact on patentees, since more than
95 percent of patent holders submit maintenance fee payments prior to
the grace period. The impact of the fee adjustment to the maintenance
fee grace period is included in the cost-benefit analysis provided in
the RIA, available at https://www.uspto.gov/FeeSettingAndAdjusting. The
Office cannot provide individuals legal advice on the status of a
patent. The Office's provision of notices of maintenance fee payments
in no way shifts the burden of
[[Page 46953]]
monitoring the time for paying maintenance fees on patents from the
patentee or other relevant stakeholders to the Office.
Comment 27: One commenter wanted to know what other IP offices have
late payment surcharges for maintenance fees, along with more
information on those offices' maintenance/annuity schedules.
Response: The USPTO allows for payment of maintenance fees up to
six months prior to the payment due date and up to six months after the
due date (grace period) if accompanied with a surcharge. This practice
is similar to other national or regional IP offices like the European
Patent Office and the Japan Patent Office. Both of these offices impose
a substantial surcharge for late payment of such fees, which, in the
case of Japan, is a 100 percent surcharge for late payment.
Each national or regional IP office has its own maintenance/annuity
schedule, which can be found on its website. Below are links to two of
the national/regional IP offices' fee schedules, which include
maintenance/annuity fees:
European Patent Office:
Fee Schedule: https://my.epoline.org/portal/classic/epoline.Scheduleoffees
About Renewal Fees: https://www.epo.org/law-practice/legal-texts/html/guidelines/e/a_x_5_2_4.htm
Japan Patent Office:
Fee Schedule: https://www.jpo.go.jp/e/system/process/tesuryo/hyou.html
About Renewal Fees: https://www.jpo.go.jp/e/faq/yokuaru/fees.html#anchor4-3
Comment 28: One commenter stated that charging surcharge fees for
late payments on patent maintenance filings and encouraging earlier
payment defies Congress. In the commenter's opinion, Congress
determined that the public should have clear notice of the expiration
of a patent on the 4th, 8th, and 12th anniversaries of it being issued.
The commenter believed the USPTO's proposal suggests the public should
know on the 3\1/2\, 7\1/2\, and 11\1/2\ anniversaries. The commenter
suggested there is no statutory delegation noted by the USPTO of the
authority to hold such an opinion, let alone act on it.
Response: The USPTO has specific statutory authority to charge fees
under title 35 of the U.S.C. and the Trademark Act of 1946. The USPTO
also has specific authority to set and adjust those fees as in the
current rulemaking under section 10 of the AIA. This Final Rule does
not modify the maintenance fee grace period, which is set in 35 U.S.C.
41(b)(2), nor does it change the timeline for submitting maintenance
fee payments. The rulemaking simply adjusts the surcharge fee for
submitting a maintenance fee payment during the six-month grace period.
The Office cannot provide legal advice to individuals on the status of
a patent, but a higher surcharge may encourage more patent holders to
pay maintenance fees before the grace period begins.
Request for Expedited Examination of a Design Application Fee
Comment 29: Several commenters stated that the increase has not
been adequately justified as based on the cost of recovery or value to
the recipient, noting that while the fee had not increased since
November 2000, an increase of 1.6 percent annually would only put the
fee at $1,256 in 2021. They further stated that the NPRM only opaquely
describes the Office's need without any calculation or demonstration of
burden hours and threatens to close the program without the full
increase, improperly discouraging applicant behavior. Commenters asked
for further justification from the Office for the amount of the
proposed increase. One commenter also suggested the Office may consider
removing the requirement of a pre-examination search, which would help
applicants by alleviating some of the financial burden associated with
filing a request for expedited examination.
Response: The Office received numerous comments that the fee
increase to $2,000 was too great and would deter applicants from using
the service. These comments were considered, and in response, the
Office has chosen not to implement the proposed fee of $2,000. Instead,
the non-discounted fee for an application will be set at $1,600.
Discounts for small and micro entities will continue to be available.
Applicants who wish to have the examination of their design
applications expedited must file a request for expedited examination
and comply with the other requirements set forth in 37 CFR 1.155. The
Office notes that the unit cost presented for this service only
accounts for the initial processing of the request and does not include
additional resources expended. From the time a request for expedited
examination is filed in a design application, the application is
expedited at every touch point during its prosecution. This includes
initial processing, deciding the request to expedite, search and
examination, publication, and any appeal that may be taken to the
Board. The pendency for these applications, from granting of the
request to expedite until first Office action, is currently just over
one month. Expediting each step of the process for these applications
causes the Office to expend resources that increase its costs with
respect to these applications. Further, the Office needs to account not
only for the increase in costs over the past twenty years, but also the
anticipated costs of providing this service into the future, even with
maintaining the requirement for a pre-examination search. Accordingly,
the Office determined that the fee for this service needs to be
increased if the service is to be continued. The USPTO believes that
this new fee amount, as well as the associated small and micro entity
discounts, will provide the Office the ability to continue offering
this service to applicants. Further, the Office notes this is an
optional fee paid only by those who wish to receive the benefit of a
faster decision on their application.
Comment 30: A few commenters noted that design applications are
limited to a single claim, meaning the proposed increase would cause
applicants to pay roughly twice as much to expedite the examination of
four design patent claims as they would to expedite the examination of
four utility patent claims.
Response: The Office acknowledges that design applications are
limited to a single claim. The process of examining a design
application differs from the process of examining a utility
application. Based on the lifetime costs of expediting a design
application, the Office has determined that the fee for this service
needs to be increased if the service is to be continued. However, the
Office has carefully considered all of the comments and, in response,
has chosen not to implement the proposed fee of $2,000. Instead, the
non-discounted fee for an application will be set at $1,600. The USPTO
believes that this new fee amount, as well as the associated small and
micro entity discounts, will provide the Office the ability to continue
offering this service to applicants.
Comment 31: Multiple commenters stated that the proposed increase
in the request for expedited examination of a design application fee
would disproportionately harm individual inventors and small entities.
Response: The Office has carefully considered all of the comments
and, in response, has chosen not to implement the proposed fee of
$2,000. Instead, the non-discounted fee for an application will be set
at $1,600. The Office will continue to offer the 50 percent small
entity discount and the 75 percent
[[Page 46954]]
micro entity discount, which should not disproportionately harm
individual inventors and small entities. The fees set in this Final
Rule make the fee for small entities $800 and the fee for a micro
entity $400. Further, the Office notes this is an optional fee paid
only by those who wish to receive the benefit of a faster decision on
their application.
Comment 32: A few commenters noted that the process to obtain
design protection in the U.S. is significantly longer than in many
countries. Not all applicants and circumstances can wait for the normal
lengthy U.S. examination process to be completed. The Office should not
impose further barriers to obtaining timely design protection for those
applicants who may need it.
Response: The process to obtain a design patent in the U.S. takes
longer than in some other countries because, unlike some other patent
systems, the USPTO performs an examination for design patent
applications. The Office agrees that expedited examination can be a
benefit to applicants in numerous situations. As a result, the Office
will continue to offer expedited examination for design applications.
Additionally, the Office has chosen not to raise the fee for expedited
examination of design applications to $2,000. Instead, the large entity
fee for an application is being raised to only $1,600. The Office will
continue to offer the 50 percent small entity discount and the 75
percent micro entity discount.
Comment 33: One commenter noted that some industrial designs can be
protected through copyright law but stated that designs that do not
qualify for copyright protection should have an affordable expedited
procedure to obtain IP rights. The commenter also noted that copyright
law might not always be effective for protection of designs.
Response: An applicant should determine what forms of IP protection
are appropriate for each design. For those inventions where an
applicant has determined that design patent protection is warranted,
the applicant may expedite the examination of an application, when
needed, as the Office will continue to offer the service. Based on
comments received, the Office has chosen not to raise the fee for
expedited examination of design applications to $2,000. Instead, the
large entity fee for an application is being raised to only $1,600. The
Office will continue to offer a discount for small and micro entities.
Utility and Reissue Issue and Maintenance Fees
Comment 34: One commenter noted that a stated rationale for the
proposed substantial increases to issue and first stage maintenance
fees is that ``technology lifecycles [have grown] shorter,'' and,
therefore, ``It is important that the USPTO not rely too heavily on
fees paid late in the life of a patent.'' The commenter argued that in
many industries, including telecommunications and pharmaceuticals, this
is not necessarily true. Therefore, the commenter did not believe that
shifting the burden of fee increases to the issue and first maintenance
fees is warranted.
Response: In accordance with the Agreement on Trade-Related Aspects
of Intellectual Property Rights (TRIPS), the USPTO cannot differentiate
IP policy by technology. Therefore, the Office must structure its fee
schedule to align with the technology lifecycles of all industries and
cannot establish different fee schedules for different technologies.
While many technologies have not experienced a change in their
lifecycle, for others there have been significant changes.
Additionally, the aggregate average patent lifecycle is impacted by
changes in the composition of patents granted by the USPTO. To account
for these changes, the USPTO is increasing the issue and first stage
maintenance fees. There has not been an adjustment to these fees since
2013.
Comment 35: One commenter noted that it is important to set fees so
that, during the entire lifecycle of a patent, a patentee can pay fees
at points in time where sufficient information is available to make an
appropriate decision about the commercial merits of obtaining/
maintaining a patent.
Response: The fees over the life of a patent begin low and then
gradually increase. The USPTO carefully considered the balance of
front-end and back-end fees. In this Final Rule, the balance between
front-end and back-end fees is not significantly impacted. The Office
is slightly rebalancing the back-end fees to recover the initial search
and examination costs earlier in the life of the patent.
AIA Trial Fees
Comment 36: Several commenters stated that the Office should finish
collecting and analyzing costs before increasing the AIA trial request
fee and the post-institution fee. One commenter indicated that pre-
institution costs may decrease due to higher settlement rates and lower
institution rates. Other commenters indicated that most of the
additional work after SAS Institute Inc. v. Iancu, 138 S. Ct. 1348
(2018) (SAS) occurs post-institution. Accordingly, the commenters
propose that the increase should be limited to the post-institution
fee.
Response: The USPTO is committed to maintaining the PTAB's ability
to provide fair, timely, and high-quality decisions. The SAS decision
significantly affected the operations of the PTAB by increasing the
amount of time spent per case and, thereby, increasing costs in both
pre- and post-institution stages. The NPRM proposed fees based on the
Office's best estimates, taking into consideration the cost increases
already experienced, plus future inflationary cost growth. Since then,
the Office has collected and analyzed the additional cost data
available through the end of FY 2019. In addition, the Office has taken
into account uncertainties resulting from changes in the way in which
AIA trials are conducted. These uncertainties are discussed further
below.
While the unit cost data shows that post-institution costs have
increased more than pre-institution costs, pre-institution costs have
also increased. The Office has modified its pre-institution practice to
take into account the Supreme Court's SAS decision. For example, prior
to SAS, the PTAB did not always address all arguments at institution.
Post-SAS, for purposes of deciding whether to institute trial on a
petition, the Office has committed to provide details to the parties to
the largest extent practicable, including responding to arguments in a
patent owner's preliminary response that were not the basis for the
decision whether or not to institute.
In addition, in response to requests from stakeholders, the Office
has modified its approach to concurrent petitions challenging the same
patent or patents in the same family filed by the same petitioner.
Specifically, the Board now considers whether to exercise its
discretion to limit the number of these parallel petitions that may, if
the threshold is met, be instituted. Similarly, the Board has
undertaken a closer review of petitions to determine whether they raise
issues that were considered by the examiner during ex parte prosecution
or during other proceedings before the Office. To evaluate these
requests, the Board must make close comparisons between the challenges
to determine whether the Board should exercise its discretion and
institute a trial. Such comparisons require analyzing the prior art
cited in the petitions and evaluating the reasons given by the
petitioners for filing additional petitions. As this development in AIA
trial practice is relatively recent (within the last 12 months), the
Office does not yet have an
[[Page 46955]]
accurate model to predict how many requests it will receive and how
much additional effort will be necessary to evaluate them. To account
for these uncertainties, it is necessary to set the pre-institution
fees for inter partes reviews at $19,000. This 23 percent increase is
less than the 25 percent increase proposed in the NPRM but above the FY
2019 unit cost. The pre-institution fee is set at more than the FY 2019
unit cost to take into account the uncertainties outlined above that
arose in that year and are expected to continue in FY 2020 and beyond.
The post-institution fee has been set at $22,500 for inter partes
review, which is above the increase proposed in the NPRM but
considerably lower than the FY 2019 actual unit cost. As a result of
the SAS decision, there has been an increase in the number of remands
to the PTAB, which has increased the post-institution amount of work
and costs. At this time, it is unclear whether the post-institution
costs will remain at the current level or will decrease after the SAS
remands have been fully addressed. Accordingly, the post-institution
fee is set above the proposed NPRM fee, which is above the pre-SAS FY
2017 unit costs but below the post-SAS FY 2019 unit costs. The Office
continues to evaluate the data as it becomes available to better
understand the long-term impact of SAS on post-institution costs.
Post-grant review and covered business method review fees will be
maintained at the rates proposed in the NPRM, at $20,000 for pre-
institution and $27,500 for post-institution. These fee rates are above
the respective inter partes review fees, due to the additional work
involved with post-grant and covered business method reviews, but below
the FY 2019 actual unit costs for post-grant reviews and covered
business method reviews due to uncertainties about future costs.
Specifically, post-grant reviews and covered business method reviews
may raise additional issues beyond those raised in inter partes
reviews, such as patent eligibility, written description, enablement,
indefiniteness, and public use. Further, given the additional issues
that may be raised, post-grant reviews and covered business method
reviews provide 33 percent higher word limits for petitions and patent
owner responses and preliminary responses. While the actual unit costs
for post-grant and covered business method review have typically been
higher than the unit costs for inter partes reviews for these reasons,
it is harder to determine the precise cost of post-grant and covered
business method reviews. Due to a relatively small number of trials
(approximately 60 post-grant reviews or covered business method reviews
annually), the data on actual unit costs can vary from year to year.
Therefore, it remains unclear whether the post-SAS costs will remain at
the current levels. The rates proposed in the NPRM will be implemented,
and the Office will continue to evaluate data as it becomes available
to better understand the long-term impact of SAS on post-grant review
and covered business method review costs.
Comment 37: One commenter stated that the USPTO's elasticity data
fails to capture whether small entities react differently than large
entities to changes in the AIA trial fees. The commenter suggested the
USPTO should study this before instituting a significant increase in
fees.
Response: AIA trial fees are not subject to small or micro entity
discounts under section 10(b) of the AIA. Therefore, reliable data is
not available to properly measure the impact of changes to AIA trial
fees on small or micro entities. However, the AIA trial proceedings
have been popular with some stakeholders because they provide a less
expensive and faster alternative to district court litigation. As a
result, the PTAB workload has increased significantly since the
institution of AIA trials. The increase in AIA trial proceeding fees
will help the PTAB maintain the level of judicial, legal, and
administrative staff necessary to sustain the quality and timeliness of
PTAB decisions.
Comment 38: One commenter stated that, for AIA trial fees, the
Office should consider a fee reduction or waiver for small and micro
entities sued for infringement.
Response: Under section 10(b) of the AIA, the Office is permitted
to reduce fees for small and micro entities in six categories:
``filing, searching, examining, issuing, appealing, and maintaining
patent applications and patents.'' AIA trial fees do not fall into any
of those categories. Therefore, absent a change in statutory authority,
AIA trial fees are not eligible for discounts or for waiver.
Comment 39: Two commenters stated that the Office should reduce the
excess claim threshold for an AIA trial request fee from 20 claims to
between three and six claims, and also increase the excess claims fee.
The commenters make similar proposals for post-institution AIA trial
fees.
Response: The fee increases are based on cost data collected and
analyzed using current excess claims thresholds. The Office does not
have sufficient data to evaluate the effect of reducing the excess
claim threshold and increasing the excess claims fee. Additionally, the
current excess claims fee threshold of 20 for the AIA trial request fee
is the same as the threshold for excess claims for patent applications.
Comment 40: One commenter indicated that the Office should raise
fees significantly higher and charge more if the petitioner has not
been sued.
Response: 35 U.S.C. 311(a) and 321(a) require fees for AIA trial
proceedings be ``reasonable, considering the aggregate costs of the
review.'' Raising fees significantly higher for petitioners that have
not been sued has been considered but, bearing in mind the aggregate
costs of the review, has not been deemed reasonable at this time.
Comment 41: One commenter indicated that raising fees runs counter
to Congress's intent to make cost-efficient proceedings.
Response: 35 U.S.C. 311(a) and 321(a) indicate that fees for AIA
trial proceedings are to be ``reasonable, considering the aggregate
costs of the review.'' The Office is always looking for, and open to
considering, ways to make AIA trial proceedings more cost-efficient.
Non-DOCX Filing Surcharge Fee
Comment 42: Several commenters expressed the opinion that the
Office's DOCX submission tools are not ready for implementation for a
number of reasons. The DOCX submission process is only available for
some submissions. The publicly available DOCX submission process is
cumbersome. It is too soon to require a penalty (fee surcharge) of $400
for non-DOCX submissions. Before such a large penalty is enacted for
failure to use DOCX submissions, applicants must be granted more time
to adapt their processes to take advantage of the new capability.
Commenters suggested an alternative approach of permitting submission
of both a record copy and a searchable copy of an application that
would provide a viable mechanism to help applicants transition to these
new capabilities without prematurely penalizing them, especially in
situations where the available tools may not be ready or able to
accommodate special cases involving complicated submissions.
Response: These comments were considered, and the Office has chosen
to delay implementation of the non-DOCX filing surcharge until January
1, 2022. Over the next several months, the Office will continue with
its outreach efforts, addressing customer concerns and
[[Page 46956]]
providing ample time for applicants to transition to this new process.
Comment 43: One commenter questioned the statement made by the
USPTO Acting Deputy Director in the September 2018 PPAC Fee Setting
Hearing that ``fees for search and examination are set below cost,''
and wondered whether this was true when considering the paper filing
surcharge and proposed non-DOCX filing surcharge.
Response: Under the adjusted fee schedule, the combined fees for
filing, search, and examination will continue to be below the cost to
the Office to provide those services, even for filers who pay both the
paper filing and non-DOCX surcharges. A large entity that pays both
surcharges would pay $2,620 for filing, search, and examination. A
small entity would pay $1,310, and a micro entity would pay $755. The
cost to the USPTO to provide these services was a combined $4,970 in FY
2018.
Comment 44: One commenter wrote that they understand that a non-
DOCX surcharge cannot be applied to PCT filings because copies of the
PCT publication automatically route into the U.S. national stage
application in PDF form. However, the commenter stated that this
highlights the unwarranted nature of the non-DOCX surcharge. If a
relatively moderate increase in price for PCT national stage entry
applications is believed to be fiscally sustainable within the proposed
fee structure, then the same should be true of regular non-provisional
application filings, and the imposition of a new non-DOCX filing
surcharge fee for one and not the other is thus inconsistent.
Response: Processing DOCX in national stage applications presents
additional challenges and burdens on the Office and applicants that are
not encountered with a standard utility application. Further
investigation is needed as to the possibility of alternative means for
obtaining text data (i.e., via the International Bureau) that would not
burden applicants. This is being considered for the future.
Comment 45: One commenter stated that filing in DOCX is a wonderful
idea in theory, but says that bugs have not been worked out of the
process. The commenter writes that EFS-Web should stop removing ``text
ornaments.'' Until it stops doing this, and until a DOCX filing will
reliably result in an identical PDF document, there should be no
penalty for filing PDF specifications or other application elements.
Response: ``Text ornaments,'' or text decorations, may not be
presented in a form that allows direct reproduction of readily legible
copies. See CFR 1.52. Therefore, they will continue to be automatically
removed, and a warning will be provided.
To date, the Office has not received notifications of any issues
resulting from the filing of applications in DOCX format. If there is
an instance in which an error occurs, the Electronic Business Center
(EBC) should be contacted for investigation at 1-866-217-9197 (toll-
free), 571-272-4100 (local), or [email protected]. The EBC is open from
6:00 a.m. to 12:00 midnight ET, Monday through Friday.
Comment 46: Multiple commenters opposed the $400 surcharge for
filing in non-DOCX format, suggesting it was unreasonable given the
USPTO's own cost figures, to apply optical character recognition (OCR)
to convert a patent application submitted in PDF format. One commenter
stated that the proposed benefits do not appear to justify the costs of
the rule, and there does not appear to have been consideration of
approaches that reduce burdens and maintain flexibility and freedom of
choice for the public.
Response: The use of image-based PDFs incurs many costs over the
lifetime of an application. There are large costs associated with the
USPTO's systems and personnel, from pre-examination, examination, and
publication, due to the need to apply OCR to convert image-based PDFs
into structured text that can be leveraged by downstream systems. The
surcharge is applied not only to account for these inefficiencies, but
also to address rising expenses.
As a part of the DOCX intake process, preliminary validation is
performed on DOCX documents at the time of upload. The system
immediately detects and supplies the applicant with useful error and
warning messages, allowing for adjustments to patent applications
earlier in the process. This saves time, reduces potential costs, and
prevents delays in processing by minimizing notices of missing parts or
incomplete applications from the Office of Patent Application
Processing (OPAP).
As patent applications have become increasingly complicated, the
non-DOCX surcharge is an effective measure to recover the cost of
converting PDFs to text. The text is essential for efficient
examination and maintaining the quality of patents issued. According to
surveys conducted by the USPTO, the majority of applicants use word-
processing software, such as Microsoft Office and LibreOffice, to
author applications in DOCX format. These applicants will now be able
to submit applications in this same format to the USPTO, therefore
avoiding the new non-DOCX surcharge. Furthermore, the fee is reduced by
50 percent for small entities and 75 percent for applicants that
qualify as micro entities.
The Office recognizes the need for freedom of choice to file in
different formats. Therefore, image-based PDFs will continue to be
accepted for customers who opt to continue to file in that format.
Comment 47: Two commenters requested that the Office continue to
accept PDF filings at no charge.
Response: The use of image-based PDFs incurs many costs over the
lifetime of an application. Receiving most applications in DOCX format
will provide savings across USPTO systems, enabling efficient
examination. Rising expenses make it prohibitive for the USPTO to
continue allowing PDF filings with no associated fee to cover the costs
of creating structured text that can be leveraged by downstream
systems.
Comment 48: Many commenters have suggested the USPTO should make a
provision for the practitioner to be able to provide a PDF version of
the patent application being filed, along with the DOCX file. The PDF
version would serve as the controlling version in the event of any
discrepancy in the USPTO's rendering of the DOCX file.
Response: Many applications are originally created in DOCX and
subsequently converted to PDF by applicants prior to submission. An
advantage of submitting in DOCX format directly is that submitted files
from all applicants are validated and converted to PDF by USPTO systems
in a consistent manner. This eliminates the unnecessary step for
applicants to generate and attach their own PDF documents. The
generated PDF is available pre-submission to provide the applicant an
opportunity to review the document before selecting the submit button.
As a part of the DOCX intake process, preliminary validation is
performed on DOCX documents at the time of upload. The system
immediately detects and supplies the applicant with useful error and
warning messages, allowing for adjustments to patent applications early
in the process. This saves time, reduces potential costs, and prevents
delays in processing by minimizing notices of missing parts or
incomplete applications from the Office. Furthermore, the USPTO
continuously performs rigorous testing to ensure that document
integrity is preserved.
Comment 49: One commenter asked whether the surcharge would be
waived if an applicant filed on paper because the electronic filing
system was not
[[Page 46957]]
functioning and a DOCX version was later filed within a certain time
period.
Response: The current policy regarding significant unplanned
electronic business system outages is available at: https://www.federalregister.gov/documents/2018/08/30/2018-18897/filing-patent-applications-electronically-during-designated-significant-outages-of-the-united-states. The USPTO will post a notice on its website in the
event of a designated significant unplanned electronic business system
outage and indicate the dates during which the alternative electronic
filing means are available due to such an outage. An application filed
via the alternative electronic means during a designated significant
unplanned electronic business system outage will be considered to have
been filed by the USPTO's electronic filing system and thus will not
incur the non-DOCX surcharge or the fee required by section 10(h) of
the AIA for a patent application not filed by the USPTO's electronic
filing system.
Comment 50: One commenter stated that PDF format is the best and
safest format for ensuring that no text becomes garbled or otherwise
corrupted by the USPTO system.
Response: There have been cases where an applicant submitted PDF
documents that have been corrupted or garbled that were traced back to
specific PDF creation software. By submitting in text format, the extra
step to convert to a PDF copy is no longer necessary, which eliminates
issues associated with that conversion process.
Another advantage of submitting in DOCX format directly is that
submitted files from applicants are validated and converted to PDF by
USPTO systems in a consistent manner. The USPTO continuously performs
rigorous testing to ensure that document integrity is preserved.
Comment 51: One commenter wrote that PDF files are easier to manage
when filing, are better for long-term archival use, can be generated in
text-searchable form, will not require fragmented filings using both
PDF and DOCX files, carry fewer concerns with respect to malware and
viruses, and carry no licensing concerns. The commenter expressed that
the DOCX file format is intended for facile editing and by design is
not suited for archival purposes, will require fragmented filing with
different file formats, will require archiving of files in multiple
file formats, carries increased risk of malware and viruses, is no
better than other editable file formats, and carries some uncertainty
regarding licensing status.
Response: DOCX is a word-processing file format that is part of
Office Open XML (OOXML), an XML-based open standard approved by the
Ecma International[supreg] consortium and subsequently by the ISO/IEC
joint technical committee.
For more information about the OOXML standard, please see:
ECMA-376 at http://www.ecma-international.org/publications/standards/Ecma-376.htm
ISO/IEC 29500 at https://www.iso.org/committee/45374/x/catalogue/
NIST votes for US. Approval of OOXML at https://www.nist.gov/news-events/news/2008/03/nist-votes-us-approval-modified-office-open-xml-standard
The USPTO conducted a yearlong study of the feasibility of
processing text in PDF documents. The results showed that searchable
text data is available in some PDFs, but the order and accuracy of the
content could not be preserved. With DOCX, the Office is able to use
the text directly and pass it on to USPTO downstream systems, which
results in increased data accuracy and a more streamlined patent
process.
PDFs are not immune to viruses or hidden malware. However, the
USPTO filing system is equipped with malware and virus detection.
DOCX is supported by many popular word-processing applications,
such as Microsoft Word, Google Docs, Pages, and LibreOffice.
Comment 52: One commenter asked if the USPTO has facts to support
the statement that the DOCX to PDF conversion process will work
flawlessly 100 percent of the time. If not, the commenter asserted that
moving to DOCX is simply not justifiable from a technical perspective.
Response: By submitting in DOCX format directly to USPTO systems,
submitted files from all applicants are validated and converted to PDF
by USPTO systems in a consistent manner. The USPTO continuously
performs rigorous testing to ensure that document integrity is
preserved. To date, the Office has not received notifications of any
issues resulting from the filing of applications in DOCX format. If
there is an instance in which an error occurs, the EBC should be
contacted for investigation at 1-866-217-9197 (toll-free), 571-272-4100
(local), or [email protected]. The EBC is open from 6:00 a.m. to 12:00
midnight ET, Monday through Friday.
Comment 53: One commenter asked about a situation in which the
USPTO's rendering engine has changed the result relative to what the
practitioner saw on a word processor. The commenter expressed concerns
about how to rectify such a situation and stated that knowing that
there is a problem and being able to fix the problem in a timely manner
may be two completely different things.
Response: If there is an instance in which an error occurs, the EBC
should be contacted for investigation at 1-866-217-9197 (toll-free),
571-272-4100 (local), or [email protected]. The EBC is open from 6:00 a.m.
to 12:00 midnight ET, Monday through Friday.
Comment 54: A few commenters noted that the USPTO places the
responsibility on the practitioner to check the generated PDF for
accuracy. One commenter wanted to confirm that the authoritative
document will be the USPTO-generated PDF rather than the DOCX that was
submitted. Another commenter felt that USPTO-generated PDFs remove the
applicant's ability to control accuracy, and applicants who choose to
guarantee accuracy by filing a self-generated PDF should not be
penalized with increased fees.
Response: The authoritative document will be the PDF that the USPTO
systems generate from the DOCX. The filer has always been responsible
for the accuracy of the documents being submitted. According to surveys
conducted by the USPTO, the majority of applicants use word-processing
software, such as Microsoft Office and LibreOffice, which can produce a
DOCX file.
Currently, most applicants convert their DOCX documents to PDF and
review the PDF documents before submission. Allowing applicants the
ability to upload the specification, claims, and abstract in DOCX
format reduces the applicants' burden to convert the document to PDF.
With this new and improved process, applicants have the ability to
upload DOCX documents directly to the USPTO filing system, which will
automatically generate PDF documents for the uploaded DOCX files. At
this time, applicants are encouraged to review the PDF documents before
submission. The step of applicants reviewing their self-generated PDF
is being replaced with their review of the USPTO-generated PDF
document. The amount of time required by an applicant to review the
self-generated PDF is comparable to the time to review the USPTO-
generated PDF.
As a part of the DOCX intake process, preliminary validation is
performed on DOCX documents at the time of upload. The system
immediately detects and supplies the applicant with useful error and
warning messages, allowing for adjustments to patent applications early
[[Page 46958]]
in the process. This saves time, reduces potential costs, and prevents
delays in processing by minimizing notices from the Office of missing
parts or incomplete applications.
The USPTO continuously performs rigorous testing to ensure that
document integrity is preserved. To date, the USPTO has not received
notifications of any issues resulting from the filing of applications
in DOCX format. If there is an instance in which an error occurs, the
EBC should be contacted for investigation at 1-866-217-9197 (toll-
free), 571-272-4100 (local), or [email protected]. The EBC is open from
6:00 a.m. to 12:00 midnight ET, Monday through Friday.
Comment 55: One commenter wrote that instead of DOCX, applicants
could upload most of their submissions as text-based PDFs. The
commenter further stated that, currently, the USPTO's computer systems
degrade files to flatten them to unstructured bitmaps. The commenter
contends the problem is caused by the USPTO.
Response: The USPTO conducted a yearlong study of the feasibility
of processing text in PDF documents. The results showed that searchable
text data is available in some PDFs, but the order and accuracy of the
content could not be preserved. With DOCX, the Office is able to use
the text directly and pass it on to USPTO downstream systems, which
results in increased data accuracy and a more streamlined patent
process.
Comment 56: One commenter stated that for lengthy, complex
specifications, the 60-minute timeout in EFS-Web would preclude
effective review. In the case of a timeout, the subsequent re-
submission would still require the filer to review the entire
conversion result from the beginning.
Response: This concern can be mitigated by keeping a session
active. The timeout process complies with National Institute of
Standards and Technology (NIST) guidelines.
Comment 57: One commenter recommended that no surcharge would be
due if a substitute specification is filed after payment of a surcharge
for filing a non-DOCX specification, claims, and/or abstract. Further,
the commenter recommended only charging this fee once per application
to avoid burdening those individuals who are unable to file DOCX
documents.
Response: Substitute specifications are considered follow-on
documents to an existing application and would not be assessed the non-
DOCX surcharge. There will only be one fee per application because the
surcharge only applies to initial filings of the non-provisional
utility application filed under 35 U.S.C. 111.
Comment 58: One commenter suggested that this surcharge be limited
to filing of utility applications and not be extended to the filings of
additional documents (e.g., responses, amendments, etc.) to avoid it
unduly burdening small businesses and independent inventors by charging
this surcharge every time a non-DOCX document is filed.
Response: At this time, the surcharge only applies to initial
filings of the non-provisional utility application filed under 35
U.S.C. 111.
Comment 59: Two commenters stated that there is no single DOCX
standard to which Microsoft Word and the other word processors are all
compliant.
Response: DOCX is a word-processing file format that is part of
Office Open XML (OOXML), an XML-based open standard approved by the
Ecma International[supreg] consortium and subsequently by the ISO/IEC
joint technical committee.
For more information about the OOXML standard, please see:
ECMA-376 at http://www.ecma-international.org/publications/standards/Ecma-376.htm
ISO/IEC 29500 at https://www.iso.org/committee/45374/x/catalogue/
NIST votes for U.S. Approval of OOXML at https://www.nist.gov/news-events/news/2008/03/nist-votes-us-approval-modified-office-open-xml-standard
Comment 60: A few commenters were concerned that DOCX files that
contain mathematical equations, chemical formulas, tables, or special
fonts would get corrupted by the USPTO system.
Response: When a DOCX file is uploaded to the USPTO filing system,
a PDF equivalent document is generated for applicant review. The USPTO
performs continuous testing of DOCX format files, including sample
files that include mathematical equations, chemical formulas, tables,
and special fonts. The past results have shown no issues with the
conversion of these data types. The Office is working on advanced
solutions so that complicated structures in chemical and biochemical
patent applications are properly captured in DOCX format.
After submission, applicants have the opportunity to download the
associated XML of the submission document, which contains mathematical
markup language (MathML) of the mathematical formulas and the content
and structure of tables. The USPTO continuously performs rigorous
testing to ensure that document integrity is preserved.
To date, the Office has not received notifications of any issues
resulting from the filing of applications in DOCX format. If there is
an instance in which the mathematical formulas or tables are corrupted
in the DOCX and PDF generated by USPTO systems, the EBC should be
contacted for investigation at 1-866-217-9197 (toll-free), 571-272-4100
(local), or [email protected]. The EBC is open from 6:00 a.m. to 12:00
midnight ET, Monday through Friday. The USPTO's DOCX support web page
located at https://www.uspto.gov/patent/docx contains a complete list
of approved fonts. If there is a font that is not supported, the EBC
should be contacted. Pending thorough analysis of the proposed font, it
may be added to the supported font list as allowable.
Comment 61: A few commenters suggested that requiring a
subscription to Microsoft Word to produce DOCX files or payment of a
significant surcharge would especially impact individual inventors and
start-ups, who are the least able to afford it.
Response: Microsoft Word is not required to file in DOCX format.
Listed below are word-processing applications that can be used to file
in DOCX format.
Microsoft Word 2007 or higher
Google Docs
Office Online
LibreOffice
Pages for Mac
Comment 62: One commenter stated that the USPTO's current DOCX
system breaks page numbering and other automatic formatting features
provided by Word because it splits a single document into three
documents: The specification, claims, and abstract. The commenter
further stated that the shift from PDF to DOCX will affect applicants'
recordkeeping requirements and costs. The commenter contends the
USPTO's Paperwork Reduction Act of 1995 (PRA) analysis fails to
consider this and similar costs.
Response: The USPTO considered the impact of the conversion to
DOCX, including the aspects raised by the commenter. Applicants can
submit one single DOCX document for the specification, including the
written description, claims, and abstract. Alternatively, they can
submit three separate DOCX documents (specification, claims, abstract).
Regardless, this will not affect page numbering or recordkeeping.
Therefore, the Office does not believe that this will increase the
overall burden and/or costs to applicants.
Comment 63: One commenter wrote that in the NPRM, the USPTO claims
that over 80 percent of applicants draft
[[Page 46959]]
their patent applications in DOCX. The commenter wishes to understand
where this data originated and submits that this does not eliminate
document integrity issues with the USPTO receiving DOCX filings
properly.
Response: A survey was conducted by the USPTO to obtain this data.
An advantage of submitting in DOCX format directly is that submitted
files from all applicants are validated and converted to PDF by USPTO
systems in a consistent manner. The USPTO continuously performs
rigorous testing to ensure that document integrity is preserved.
Comment 64: One commenter stated that no reliable process exists in
which errors introduced by EFS-Web in its rendering of DOCX files into
PDF files may be corrected without being subject to the risk of
rejection for new matter.
Response: Applicants are encouraged to review the PDF documents
generated by the USPTO filing system before submission. The step of
applicants reviewing their self-generated PDF is being replaced with
their review of the USPTO-generated PDF document. The amount of time
required by the applicant to review the self-generated PDF is
comparable to the time to review the USPTO-generated PDF.
To date, the Office has not received notifications of any issues
resulting from the filing of applications in DOCX format. If there is
an instance in which an error occurs, the EBC should be contacted for
investigation at 1-866-217-9197 (toll-free), 571-272-4100 (local), or
[email protected]. The EBC is open from 6:00 a.m. to 12:00 midnight ET,
Monday through Friday.
Comment 65: One commenter suggested that the USPTO could extract
the convenience text from PDF documents, which, as in current practice,
are uploaded by filers without penalty and are intended to be the
``official'' filing artifacts. Almost all PDF files directly produced
from word-processing software contain extractable text. (The USPTO
states in the NPRM that more than 80 percent of filings use DOCX
authoring tools; it is reasonable to extrapolate that a high fraction
of non-drawing PDF files uploaded to EFS-Web could be directly produced
by word-processing software and could contain extractable text.) Many
PDF files created by other means also contain extractable text.
Response: The USPTO conducted a yearlong study of the feasibility
of processing text in PDF documents. The results showed that searchable
text data is available in some PDFs, but the order and accuracy of the
content could not be preserved. With DOCX, the Office is able to use
the text directly and pass it on to USPTO downstream systems, which
results in increased data accuracy and a more streamlined patent
process.
Comment 66: One commenter suggested modifying the filing system so
that if a DOCX document contains a discrepancy, it can be corrected
after the filing date without losing priority to the filing date.
Response: The ability for correction after the filing date depends
on whether it was an applicant error or Office error. If the applicant
makes an error, there is the potential to lose priority to the filing
date depending on the type of correction. For example, for applications
filed on or after September 16, 2012, if there is a discrepancy between
the information submitted in an application data sheet and the
information submitted elsewhere in the application, the application
data sheet will control except for the naming of inventors. The naming
of the inventorship is governed by 37 CFR 1.41, and changes to
inventorship or the names of inventors is governed by 37 CFR 1.48. In
addition, for applications filed on or after September 16, 2012, the
most recent application data sheet in compliance with 37 CFR 1.76 will
govern with respect to foreign priority claims or domestic benefit
claims. See 37 CFR 1.76(d) and MPEP Sec. 601.05(a). If it is the
Office's error, applicants are encouraged to contact the Patent
Electronic Business Center ([email protected]) or file a petition.
Comment 67: One commenter suggested that the Office should reduce
fees for those who file an ISO 19005-1-compliant PDF/A document, which
is fully text searchable and accessible. The commenter also suggested
that the Office could further reduce fees for those who file a DOCX
version of the application with a certification of its accuracy in
addition to their own PDF. The supplemental DOCX file would provide the
Office with the structured text without jeopardizing the official
application filed in PDF.
Response: The USPTO conducted a yearlong study of the feasibility
of processing text in PDF documents. The results showed that searchable
text data is available in some PDFs, but the order and accuracy of the
content could not be preserved. The USPTO has determined that increased
data accuracy and a more streamlined patent process will result from
DOCX submissions.
Comment 68: One commenter suggested that the USPTO reduce the
surcharge to reflect the true cost to the Office of processing non-DOCX
applications (the current cost of OCR of approximately $3.15 per new
submission) or offer a rebate for applicants filing in DOCX.
Response: The cited cost only covers the initial OCR. The use of
image-based PDFs incurs many costs over the lifetime of an application.
There are large costs associated with the USPTO's systems and
personnel, from pre-examination, examination, and publication, due to
the need to apply OCR to convert image-based PDFs to structured text
that can be leveraged by downstream systems. The surcharge is applied
not only to account for these inefficiencies, but also to address
rising expenses. Alternatively, to achieve these goals, the filing fee
could be increased by $400 and a $400 rebate could be offered for
filing in DOCX, but a lower filing fee with a non-DOCX surcharge makes
the fee schedule more streamlined than a higher fee with a rebate.
Comment 69: Several commenters asked how the Office will handle
metadata retention to assure applicants' interests will not be harmed.
A commenter wanted to know whether metadata would be irretrievably
removed upon filing or if the Office would maintain multiple versions
of an application.
Response: Generally, applicants remove metadata from their
applications prior to submission. However, if metadata is still
contained in the document when uploaded, EFS-Web (and the next
generation Patent Center tool) will automatically remove unnecessary
document properties such as author, last modified by, etc. The only
metadata that remains part of the document is the size, number of
pages, and word count. The pre-scrubbed document will not be stored by
the USPTO. Only submitted documents are stored in the USPTO repository.
Comment 70: One commenter was concerned that the process for
submitting a DOCX file is uncertain and unclear. When the user uploads
a DOCX file, the USPTO system runs it through a rendering engine to
yield a PDF file. Further, while the DOCX web page indicates that the
submission of a DOCX file generates a unique hash based on the content
of the file to ensure that the DOCX file cannot be changed post-
submission, there is no indication as to when and how this hash is
checked to determine whether a document has been modified or whether it
would matter if it had been modified, as the converted PDF document is
the official record. Because the converted PDF document is the official
record, it appears that any discrepancies discovered after submission
cannot be corrected.
[[Page 46960]]
Response: The message digest (hash) is generated to ensure non-
repudiation of the DOCX. The benefit of this generated message digest
to the applicant is that they can verify that the submitted DOCX is
identical to the file in their records. Additionally, the applicant is
given an opportunity to review the generated PDF to verify that it is
accurate prior to submission. If there is an instance in which an error
occurs, the EBC should be contacted for investigation at 1-866-217-9197
(toll-free), 571-272-4100 (local), or [email protected]. The EBC is open
from 6:00 a.m. to 12:00 midnight ET, Monday through Friday.
Comment 71: One commenter wanted the USPTO to consider the effects
of breaking up sections of a single-source document (this is presently
required of applicants who submit DOCX files, but the USPTO will do it
in the future when it allows a single specification/claims/abstract
file to be uploaded).
Response: The next generation Patent Center tool will be available
to the public before the non-DOCX surcharge is implemented and will
support the ability to upload a single file that contains all three
application parts: Specification, claims, and abstract.
Comment 72: One commenter wrote that the USPTO stated
``Applications filed using DOCX will be more accessible in future
searches of publication materials.'' The commenter wanted to know what
this statement meant, relative to OCR.
Response: Structured text coming directly from DOCX submissions can
be used for future initiatives to help streamline the patent process.
The current publication process involves human intervention and text
OCR'ed from images, which may contain errors. The goal is to leverage
the structured text submitted by applicants, which will be more
accurate than OCR'ed text, in downstream business processes.
Comment 73: One commenter asked if the non-DOCX filing surcharge
will apply to divisional and continuation applications.
Response: Yes, the surcharge applies to divisional and continuation
applications.
Comment 74: One commenter wanted to know if the non-DOCX surcharge
fee can be avoided in continuing applications by ``filing by
reference,'' as provided in MPEP 601.01(a)(III).
Response: No, the surcharge cannot be avoided by filing by
reference in a continuing application.
Comment 75: One commenter asked if the surcharge will apply to PCT
applications at national stage entry.
Response: No, the surcharge does not apply to a PCT application at
national stage entry.
Comment 76: One commenter wanted to know if the surcharge applies
to any other filings beyond filing the initial application (such as:
Office action responses, preliminary amendments, a response with a
replacement specification, etc.).
Response: No, the surcharge will not apply at this time.
Comment 77: One commenter questioned whether the surcharge will
apply if, at filing, the applicant included both a DOCX and a PDF
version of the application.
Response: Applicants should not file both the DOCX and a PDF
version of the application, as this may delay the processing of their
application. The copy of the specification not filed in DOCX would
require the surcharge, as the entire application capable of being filed
in DOCX was not filed in DOCX.
Comment 78: One commenter wanted to know whether the non-DOCX
surcharge would be imposed in addition to the paper-filing surcharge
for an application filed on paper.
Response: Yes, both surcharges would be imposed.
Comment 79: One commenter noted that plant patent applications have
been required to be filed on paper and wondered whether the non-DOCX
surcharge would apply to all plant patent applications.
Response: No, the non-DOCX filing surcharge would not apply to
plant patent applications. At this time, the surcharge only applies to
initial filings of non-provisional utility applications filed under 35
U.S.C. 111.
Pro Hac Vice
Comment 80: One commenter requested that the Office clarify the
specifics of the fee to request pro hac vice admission in an AIA trial
proceeding.
Response: The pro hac vice admission fee is per attorney, per AIA
trial proceeding. Once the request is granted, the attorney is admitted
for the entire duration of the AIA trial proceeding, which may extend
for several years. Individuals not seeking to be recognized as an
attorney of record in the AIA trial proceeding, such as expert
witnesses, are not required to pay the fee.
Annual Active Patent Practitioner Fee
Comment 81: Multiple commenters oppose any practitioner fee. Three
of the commenters stated that the USPTO should be able to fund itself,
including the costs of OED, with other revenue sources such as patent
fees, and not practitioner fees. One of the commenters suggested that
the USPTO cut costs elsewhere to compensate for the costs to be covered
by the proposed annual active patent practitioner fee. One other
commenter opposed funding OED through an annual active patent
practitioner fee as established in the NPRM. Another commenter asserted
that the justification provided for the fee is inadequate.
Response: The USPTO received a number of comments on the proposed
annual active patent practitioner fee. As discussed above, having
further considered the public feedback on this proposal, the USPTO has
determined that it will not implement the proposed annual active patent
practitioner fee at this time.
Comment 82: One commenter suggested the materials provided by the
USPTO identify no statutory authorization. The commenter contended
Sec. 41(d)(2)(A) permits the director to ``establish fees for all
other processing, services, or materials,'' but the USPTO has failed to
identify a specific ``processing, service, or material'' that is
provided. The commenter also contended Sec. 2(a)(2)(D) authorizes the
director to ``govern recognition and conduct of agents [and]
attorneys,'' but no fee is authorized as part of Sec. 2(a)(2)(D).
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 83: Two commenters wanted the USPTO to remove the annual
active patent practitioner fee and CLE discount from the NPRM and to
issue one or more separate NPRMs for any proposed annual active patent
practitioner and CLE discount or requirement. A commenter argued that
as a new fee, the newly proposed practitioner fee (and rules) likely
must be implemented, if at all, only after issuing a Federal Register
notice under the Administrative Procedures Act (APA).
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 84: One commenter stated that section 3(b)(1) of Executive
Order (E.O.) 12866 (Regulatory Planning and Review) requires that the
USPTO ``identify the problem that it intends to address (including,
where applicable, the failures of private markets or public
institutions that warrant new agency action) as well as assess the
significance of that problem.'' The commenter
[[Page 46961]]
further stated that the APA requires a statement of rationale at the
proposal stage.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 85: One commenter stated that the annual active patent
practitioner fee is not in compliance with E.O. 12866, in part, because
the NPRM did not include an estimate of either costs or benefits of the
intended regulation and thus no balancing against the status quo.
Another commenter similarly stated that the USPTO has not quantified
and monetized the benefits and costs and evaluated non-quantified and
non-monetized benefits and costs as required by OMB Circular A-4.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 86: One commenter wrote that the USPTO must analyze costs
for all patent agents and patent attorneys who do not have an existing
CLE requirement that would overlap with any USPTO requirement.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. Under this Final Rule, completion of CLE remains
voluntary. However, the Final Rule provides that patent practitioners
who have completed six credits of CLE within the preceding 24 months
may certify such completion to the OED director. The USPTO intends to
issue proposed CLE guidelines, with a request for public comment on the
proposed guidelines.
Comment 87: One commenter claimed the Regulatory Flexibility
Analysis must analyze the effect of the annual active patent
practitioner fee on small entities because a great number of
practitioners work for small entities.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 88: One commenter stated the USPTO must be able to certify
that the annual active patent practitioner fee requirement is
``necessary for the proper performance of the functions of the
agency.'' 44 U.S.C. 3506(c)(3)(A).
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 89: One commenter stated that the USPTO must be able to
certify that the annual active patent practitioner fee requirement is
implemented in ways ``consistent and compatible, to the maximum extent
practicable, with the existing reporting and recordkeeping practices of
those who are to respond,'' including those attorneys in states that do
not have existing CLE requirements, and for all agents.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. Under the Final Rule, completion of CLE remains
voluntary.
Comment 90: One commenter argued the statement in 84 FR 37422 at
col. 1 that, ``The USPTO proposes to add paragraph (d) to Sec. 11.8 to
establish a new fee to be paid annually by practitioners'' and the
statement in E.O. 13771 certification, at 84 FR 37430 that states
``this proposed rule is expected to involve a transfer payment'' cannot
both be true. The commenter contended the annual active patent
practitioner fee does not fit any of the applicable definitions of
``transfer payment.''
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 91: One commenter claimed the USPTO's proposed $100 annual
fee discount, as well as recognition on OED's public practitioner
search page for completed CLE, are encouragements that make the annual
active patent practitioner fee an unconstitutional tax.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. In addition, under the Final Rule, completion of CLE
remains voluntary. However, practitioners may be recognized in the
online practitioner directory if they certify completion of six credit
hours of CLE (five in patent law and practice; one in legal ethics) in
the preceding 24 months.
Comment 92: One commenter stated that the USPTO needs to account
for the costs of reporting and recordkeeping and other compliance costs
for the annual active patent practitioner fee under the PRA, including
a discussion of the lowest burden alternative, and that the public
benefit is in the same range. The commenter suggested that the annual
fee must be the least costly way to achieve the benefit.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 93: One commenter stated that the USPTO does not specify in
the NPRM what the ``qualitative benefits'' are for the annual active
patent practitioner fee.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 94: A few commenters requested that the USPTO identify the
statutory authority allowing for defraying the patent-related costs of
operating OED by imposition of an annual active patent practitioner fee
and also for the CLE requirement. One of the commenters stated that the
NPRM is not explicit about the basis for setting the fee but that it is
suggested that it is being set under the ``Other fees'' provisions of
35 U.S.C. 41(d)(2)(A). The commenter requested the USPTO explain how
the proposed fees involve a service to the person being charged the fee
in accordance with 31 U.S.C. 9701 (specifying that user fees must be
set based on ``the value of the service or thing to the recipient'').
One of the commenters stated that section 10 of the AIA prohibits the
creation of new fees, such as the annual active patent practitioner
fee.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. Under the Final Rule, completion of CLE remains
voluntary.
Comment 95: One commenter requested that the Office consider
approving USPTO CLE courses for on-duty training of patent examiners.
Another two commenters requested that the Office consider making the
USPTO CLE courses required for Office employees, including patent
examiners. One of these commenters requested that the USPTO have
employees pay an annual employee fee as a pilot program prior to
instituting the Final Rule to at least partially fund the USPTO.
Response: Patent examiners receive extensive on-duty training for
the performance of their official duties on a continual basis. Patent
examiner training is specifically tailored to the requirements of the
position and includes examiner guidance based on changes in the law and
regulations. However, CLE courses offered by the USPTO are generally
available to employees, just as they are available to other members of
the public. The USPTO is not requiring that any member of the patent
bar complete CLE and will not be requiring CLE of USPTO
[[Page 46962]]
employees who happen to be members of the patent bar.
Comment 96: One commenter suggested that the first three to five
years of the annual active patent practitioner fee be waived to
alleviate the cost burden for those who become registered patent
practitioners before attending law school.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 97: A few commenters suggested that the annual active
patent practitioner fee is a tax, specifically a tax on innovation. Two
of these commenters and three other commenters stated the annual active
patent practitioner fee would particularly affect smaller law firms or
part-time practitioners who represent smaller entities and independent
inventors. The commenters further asserted that if individuals are
deterred from patent practice, some patent applicants may be priced out
of legal services. It is postured that this would increase the volume
of pro se filings, inefficiency, cost, and use of USPTO resources.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 98: One commenter suggested that the annual active patent
practitioner fees will be siphoned off to Treasury funds,
disincentivizing innovation by misallocating funds. Another two
commenters questioned what the funds collected from the annual active
patent practitioner fee would be used for. One of these commenters
requested that the funds collected be used to fund pro se services.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 99: Two commenters stated that the new annual active patent
practitioner rules seem to require unneeded CLE where state bar
associations already provide ample training. One commenter inquired
whether the CLE reporting period would align with the reporting periods
used by state bars.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. In addition, under the Final Rule, completion of CLE
remains voluntary. However, patent practitioners who certify completion
of six credit hours of CLE in the preceding 24 months, including five
hours of patent law and practice and one hour of ethics, may be
recognized in the online practitioner directory. Generally, the same
types of courses and activities that qualify for CLE credit for a state
bar will qualify for credit for purposes of the CLE recognition in the
online practitioner directory, so long as it covers the appropriate
topics. It is expected that these CLE reporting periods will not align
with all state bar reporting periods, as they vary from state to state.
Each CLE certification for the purposes of recognition in USPTO's
online practitioner directory should be supported by the completion of
different CLE courses. In other words, practitioners may not use the
same courses to certify to the USPTO more than once that they have
completed the six credits of CLE.
Comment 100: One commenter stated that there was no explanation in
the NPRM for the: (1) Manner of collecting the payment for the annual
active patent practitioner fee, (2) different classes of practitioners
having different fee requirements, (3) penalties for non-compliance,
and (4) options for reinstatement. Another commenter inquired as to the
process for reinstatement.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 101: One commenter stated that once the annual active
patent practitioner fee is imposed, the fee will be increased over
time, which will change the dynamics of practicing in patent matters
before the USPTO.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 102: One commenter stated that, regarding the annual active
patent practitioner fee, taxpayers, not patent practitioners, should
pay for the Patent Pro Bono Program because taxpayers benefit from the
program. Additionally, the commenter stated that there are already pro
bono programs operated by law schools and non-governmental
organizations that address this need.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 103: A few commenters stated that, regarding the annual
active patent practitioner fee, as attorneys, they already pay state
bar dues and attend CLE, and the USPTO needs to account for those costs
when charging the fee. One additional commenter stated that the USPTO
must analyze costs for all patent attorneys who are admitted to the
bars of any state that does not impose an existing CLE requirement that
would overlap with any USPTO CLE requirement.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. The Office appreciates that CLE is required by other
state bar organizations. Under this Final Rule, completion of CLE
remains voluntary, but in taking six hours of CLE, practitioners may be
recognized in the online practitioner directory. Additionally,
practitioners may avoid duplicate expenses, as some or all of the CLE
courses attended by practitioners as required by their state bar
membership may count toward the six hours of CLE necessary to qualify
for the USPTO CLE recognition.
Comment 104: One commenter inquired about the implications of an
administratively suspended or voluntarily suspended practitioner giving
advice on a patent matter versus signing documents before the Office,
and whether giving advice on a patent matter would be considered
practice before the Office.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. However, the Final Rule requires patent practitioners
to biennially file a registration statement. If a patent practitioner
fails to timely file a registration statement, the patent practitioner
may be administratively suspended, as is the case for patent
practitioners who fail to respond to the practitioner survey. 37 CFR
11.5(b)(1) states, in part, that, ``Practice before the Office in
patent matters includes, but is not limited to . . . consulting with or
giving advice to a client in contemplation of filing a patent
application or other document with the Office.'' Thus, practice before
the Office is not limited to signing documents. An administratively
suspended practitioner is under the disciplinary jurisdiction of the
Office. See 37 CFR 11.19(a). Those who engage in the practice of patent
law before the Office without being in active status may be engaging in
the unauthorized practice of law and can be subject to discipline. See
37 CFR 11.10, 11.11(a)(6), and 11.505. Under this Final Rule, there is
no ``voluntarily
[[Page 46963]]
suspended'' status. Voluntary inactive status, which is currently
governed by 37 CFR 11.11(d), is unchanged by this Final Rule.
Comment 105: Two commenters inquired if an administratively
suspended or voluntarily suspended patent agent will lose attorney-
client privilege due to their suspended status.
Response: Under this Final Rule, there is no voluntary suspended
status. All practitioners, including suspended patent agents, must
comply with the USPTO Rules of Professional Conduct, including those
pertaining to confidentiality of information. See 37 CFR 11.106.
Attorney-client privilege is an evidentiary rule regarding
communications. See e.g., Fed. R. Evid. 501. The right to assert
attorney-client privilege belongs to the client, and the privilege
exists for the client's benefit. See e.g., Magnetar Techs. Corp. v. Six
Flags Theme Park Inc., 886 F.Supp.2d 466 (D. Del. 2012). Patent agents
are not attorneys in that they are not active members in good standing
of the bar of the highest court of any state. See 37 CFR 11.1. The
scope of the privilege as it applies to communications between clients
and patent agents has been discussed or determined by some tribunals.
See e.g., In re Queen's Univ. at Kingston, 820 F.3d 1287 (Fed. Cir.
2016); In re Silver, 540 SW3d 530 (Tex. 2018); and Privilege for Patent
Practitioners, 37 CFR 42.57. The scope of the privilege as it applies
to communications between a client and an administratively suspended
attorney, in general, is a matter of state law and has been addressed
by some courts. See, e.g., Gucci America, Inc. v. Guess?, Inc., No. 09
Civ. 4373, 2011 WL 9375 (S.D.N.Y. Jan. 3, 2011); Safety Mgmt. Sys. v.
Safety Software Ltd., No. 10 Civ. 1593, 2011 WL 4898085 (S.D.N.Y. Oct.
5, 2011); Restatement (Third) of the Law Governing Lawyers Sec. 72,
cmt. e, reporter's note cmt. e (2000) (citing cases).
Comment 106: Two commenters stated that the statuses for patent
practitioners discussed in the NPRM, including administratively
suspended, suspended due to discipline, voluntary inactive, emeritus,
and resigned, are too numerous and complex for section 10 of the AIA
fee setting authority and should be implemented in a separate rule
package because each status has separate fee and reinstatement
requirements.
Response: No new statuses for patent practitioners are created by
this Final Rule.
Comment 107: Two commenters inquired why someone would opt for
voluntary suspension status over emeritus status, as there are no fees
for emeritus status and reactivation is easier.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
this fee. Accordingly, emeritus status has been eliminated from the
Final Rule. Furthermore, no ``voluntary suspension status'' was
proposed by the NPRM or included in the Final Rule.
Comment 108: One commenter inquired if the Office considered that
an inadvertently administratively suspended attorney may need to report
the suspension to their state bar.
Response: If a patent practitioner is a member of a state bar, it
is expected that the practitioner comply with the USPTO Rules of
Professional Conduct, as well as any applicable state ethics rules,
which may include any applicable reporting requirements in state bar
rules.
Comment 109: A few commenters stated that the CLE discount is not
much of an incentive, given the cost of CLE programs, including out-of-
pocket expenses and lost productivity, and it is likely that
practitioners will choose not to make the certification and instead pay
the undiscounted annual active patent practitioner fee. One commenter
concluded that the discount therefore seems to be a tax. Another
commenter stated that if the proposed discount and online recognition
are meant to encourage CLE, then the proposal constitutes a tax that is
being used to set policy.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time, and thus, there is no CLE discount in this Final
Rule. Under this Final Rule, completion of CLE remains voluntary.
However, this rule provides that practitioners may be recognized in the
online practitioner directory for completing six credits of CLE in the
preceding 24 months, including five credits in patent law and practice
and one credit in ethics. CLE comports with the goal and spirit of 37
CFR 11.101: The USPTO requires the practitioner to be competent in the
legal, scientific, and technical knowledge and skills reasonably
necessary for client representation. This rule also provides that
practitioners may obtain up to two of the five credits in patent law
and practice by completing patent pro bono work.
Comment 110: A few commenters stated that the annual active patent
practitioner fee would disproportionately affect patent agents because
they do not currently have a CLE requirement, and they would therefore
incur an extra expense as compared to patent attorneys. Two of these
commenters additionally stated that publication of the CLE
certification status of practitioners by the OED director may be
equivalent to a public shaming of those patent practitioners who do not
have a state CLE requirement or who opt to pay the full fee, resulting
in unfair prejudice toward those who do not certify completion of CLE
and essentially making CLE mandatory.
Response: In this Final Rule, there is no active patent
practitioner fee, and thus there is no CLE discount. In addition, under
the Final Rule completion of CLE remains voluntary. Separately, this
rule provides for publication of a patent practitioner's CLE
certification status, which is intended to encourage patent
practitioners to participate in CLE and provide information to the
public regarding the patent practitioner's CLE status. The USPTO also
intends to provide additional free CLE courses to patent practitioners,
thus alleviating the financial burden of obtaining CLE credits.
Comment 111: Two commenters stated that unless the USPTO, in
advance, actively commits resources to providing free, regular, and
frequent qualifying CLE courses in the required areas, some
practitioners, particularly solo practitioners and patent agents, will
bear an additional financial burden or cost of doing business. One
commenter requested that the Office explain how the USPTO will
alleviate future CLE burden and cost.
Response: The USPTO intends to provide additional free CLE courses
for patent practitioners.
Comment 112: One commenter inquired if, in determining a proper fee
amount for the projected number of registered practitioners expected to
pay each type of fee, factors such as the historical trends of active
practitioner populations by registration year, including both estimated
new practitioner registration as well as likely attrition rates from
older subsets, were taken into consideration.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 113: One commenter stated that there is currently no
mechanism for CLE to be recorded for non-attorney patent agents. This
commenter inquired how patent agents would be able to avoid paying the
full fee in the first year
[[Page 46964]]
without procedures or a mechanism established well in advance for
patent agents to secure qualifying CLE credits. This commenter further
inquired whether practitioners would be able to reference a training or
workshop they attended even if they were not able to receive CLE
credits at the time of participation.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time, thus, there is no CLE discount. However, patent
practitioners who wish to receive recognition in the online
practitioner directory for the completion of CLE are responsible for
tracking their own CLE course attendance and credits, regardless of the
method in which such credits are recorded (or not recorded) by a state
bar or other organization. In order for the CLE credit to count toward
recognition in the online practitioner directory, the credit must be
acquired in the 24 months preceding the certification. The USPTO
intends to coordinate the delivery of CLE programs, and make the
completion of CLE--whether offered by the USPTO or third parties--as
convenient as possible for practitioners to complete, while enhancing
practitioner access to, and opportunities for, the training necessary
to stay up-to-date with current ethics and patent law and practice.
Comment 114: One commenter inquired how practitioners will be able
to determine, in advance, which third-party CLE programs will be
adequate for meeting the CLE requirement.
Response: Under this Final Rule, the completion of CLE is
voluntary. For patent practitioners who wish to complete CLE and obtain
recognition in the online practitioner directory, the USPTO intends to
coordinate the delivery of CLE programs, and make the completion of
CLE--whether offered by the USPTO or third parties--as convenient as
possible for practitioners to complete, while enhancing practitioner
access to, and opportunities for, the training necessary to stay up-to-
date with current ethics and patent law and practice. Additionally, in
the near future, the USPTO intends to issue proposed CLE guidelines,
with a request for public comment, as to the types of CLE programs,
including those offered by third parties, which may qualify for the CLE
certification and the form of recognition in the online practitioner
directory.
Comment 115: One commenter inquired if practitioners will be
required to submit formal documentation of their CLE training on an
annual basis or if each practitioner would have to maintain their own
CLE documentation records to certify they have completed the CLE.
Another commenter requested clarification on the recordkeeping
requirements for CLE, including what type of proof is sufficient to
demonstrate CLE completion. Another commenter requested clarification
on what CLE would be tracked and how long it would be tracked.
Response: In the near future, the USPTO intends to issue proposed
CLE guidelines, with a request for public comment on the proposed
guidelines. The proposed CLE guidelines will address recordkeeping
standards for practitioners who wish to certify completion of CLE and
obtain recognition in the online practitioner directory. In general, it
is contemplated that the proposed CLE guidelines will provide that
practitioners are to retain their own CLE documentation records for a
period of time.
Comment 116: Two commenters stated that they are supportive of the
notion to incentivize active practitioners to enhance and maintain
their ongoing legal education awareness and skills by providing a $100
discount for registered practitioners who certify completion of CLE.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. Thus, there is no discount associated with the
completion of CLE. However, the Office may recognize patent
practitioners in the online practitioner directory if they have
completed six credits of CLE in the preceding 24 months. The Office
believes that this will similarly incentivize active patent
practitioners to enhance and maintain their skills.
Comment 117: Two commenters inquired if the Office considered that
imposing the annual active patent practitioner fee may result in an
increase in practitioner malpractice premiums, especially if the USPTO
does not actively notify practitioners of their due dates by both USPS
mail and email. One of these commenters suggested that notification by
mail alone may be insufficient, and the Office should encourage
practitioners to register multiple mailing and email addresses with
OED. One other commenter encouraged OED to use both practitioners'
addresses in the register and those in other USPTO databases to send
out notices regarding payment, deadlines, and non-payment. The same
commenter requested that OED telephone practitioners regarding non-
payment of the annual active patent practitioner fee.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the active patent practitioner fee at this
time. Under the Final Rule, patent practitioners are required to submit
an electronic registration statement, which takes the place of the
practitioner survey. Prior to this Final Rule, patent practitioners
were subject to administrative suspension for failure to respond to the
practitioner survey. Likewise, under the Final Rule, patent
practitioners who fail to submit a registration statement are subject
to administrative suspension. The Office intends to notify patent
practitioners of the due date of the registration statement at least
120 days before such date. Additionally, 37 CFR 11.11(a) requires
practitioners to provide OED with at least one and up to three email
addresses where the practitioner receives email. Patent practitioners
are encouraged to make updates in a timely manner to and ensure the
accuracy of their contact information in accordance with 37 CFR
11.11(a) so that OED may timely communicate with practitioners
regarding any applicable deadline.
Comment 118: Multiple commenters stated the annual active patent
practitioner fee is too high. One commenter stated that the fee will
deter some practitioners and add a barrier to entry. One commenter
suggested setting the fee to the CLE discount level and providing a
discount to solo practitioners, or patent practitioners employed by a
small law firm, non-profit, and/or the government because, otherwise,
payment of the fee may become prohibitively expensive. Another
commenter stated that instead of providing the CLE discount, the Office
should provide a discount to practitioners who provide pro bono
services via the Patent Pro Bono Program. The commenter also stated
that the annual active patent practitioner fee is substantially higher
than some state bar fees. One of these commenters concluded the fee was
too high to just cover administrative costs and aiding the pro bono
programs. Additionally, the commenter would like the CLE discount to be
greater than $100. The other commenter stated that most practitioners
do not work in large city firms and therefore cannot afford the fee.
Another commenter stated that the annual active patent practitioner fee
should only be high enough to maintain the roster and should not be
used to administer CLE, pro bono activities, or outreach, such as
speaking engagements, as there are already
[[Page 46965]]
mandatory fee schedules in place (i.e., small entity and micro entity)
to aid financially under-resourced inventors. Other commenters
questioned whether the annual active patent practitioner fee should be
used to fund activities outside of practitioner discipline.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 119: A few commenters stated that the annual active patent
practitioner fee will be passed on as overhead to applicants and that
it is illusory to suggest that applicants will not eventually bear the
cost of the fees.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 120: One commenter suggested that there should be no
``voluntary inactive'' or ``emeritus'' status because it seems to
indicate that the USPTO is encouraging inactivity of practitioners who
should always have a professional obligation to remain apprised of the
current rules, case law, and filing procedures.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. As a result, the USPTO is not implementing the
proposed emeritus status. Voluntary inactive status, which is currently
available to practitioners pursuant to 37 CFR 11.11(d), is not altered
by this Final Rule.
Comment 121: Multiple commenters opposed offering a discount on the
annual active patent practitioner fee for completion of CLE. One of the
commenters asserted that by doing so, the USPTO is implying that it is
permissible not to take CLE, as long as the USPTO gets paid more money.
Commenters stated that any CLE requirement should be decoupled from the
annual active patent practitioner fee.
Response: This comment has been adopted in part. As noted in
response to Comment 81 above, the USPTO has elected not to implement
the proposed annual active patent practitioner fee at this time. Under
this Final Rule, patent practitioners are not required to complete any
CLE. However, patent practitioners may be able to obtain recognition in
the online practitioner directory by certifying that they completed six
credits of CLE within the 24 months prior to the certification
(including five credits of patent-related CLE and one credit of ethics
CLE). The Office believes that CLE serves to enhance patent
practitioners' legal skills and encourages patent practitioners to
enhance their knowledge in the areas of patent and ethics legal skills.
Competency in these areas is expected pursuant to the USPTO Rules of
Professional Conduct.
Comment 122: Two commenters questioned the value of CLE. One of
these commenters questioned the statement, ``CLE serves to enhance
practitioners' legal skills.'' 84 FR 37415. One of these commenters
stated that the present burden on attorneys of complying with CLE
requirements is already onerous.
Response: At least 46 states have implemented mandatory CLE for
attorneys. Consistent with USPTO's past statements regarding the
completion of CLE, the primary purposes of CLE are to ensure lawyer
competence, maintain public confidence in the legal profession, and
support the fair administration of justice. See 78 FR 20188; Report of
the Standing Committee on Continuing Legal Education of the American
Bar Association (February 2017); and ABA Model Rule on Continuing Legal
Education, February 2017, ``Purpose.'' Recognition in the online
practitioner directory will also serve to provide information to the
public regarding a patent practitioner's CLE status. The USPTO intends
to coordinate the delivery of CLE programs and make the completion of
CLE--whether offered by the USPTO or third parties--as convenient as
possible for patent practitioners to complete, while enhancing patent
practitioner access to, and opportunities for, the training necessary
to stay up-to-date with current ethics and patent law and practice.
Thus, completion of CLE for state bar purposes may also satisfy the
requirements to receive recognition in the online practitioner
directory.
Comment 123: One commenter stated that the proposed practitioner
fee is not in compliance with E.O. 12866, in part, because the NPRM did
not include an estimate of either costs or benefits of the intended
regulation and thus no balancing against the status quo.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 124: One commenter stated that the USPTO needs to account
for the costs of reporting and recordkeeping and other compliance costs
for the annual active patent practitioner fee under the PRA, including
a discussion of the lowest burden alternative and that the public
benefit is in the same range. The commenters suggested that the annual
active patent practitioner fee must be the least costly way to achieve
the stated benefit.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 125: One commenter stated that the USPTO must be able to
certify that the annual active practitioner fee requirement is
implemented in ways ``consistent and compatible, to the maximum extent
practicable, with the existing reporting and recordkeeping practices of
those who are to respond,'' including for those attorneys in states
that do not have existing CLE requirements, and for all agents.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. Additionally, under the Final Rule, patent
practitioners are not required to complete CLE.
Comment 126: One commenter stated that, regarding the annual active
patent practitioner fee, the USPTO has not quantified and monetized the
benefits and costs and evaluated non-quantified and non-monetized
benefits and costs as required by OMB Circular A-4.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 127: Two commenters stated that the USPTO does not need to
engage in activities similar to state bars because either there is no
similar activity at the USPTO, or such activities would be redundant
with what is provided by state bars. Another commenter stated that
state bar associations provide more distinct services to member
attorneys than OED provides to patent practitioners.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. However, the USPTO engages in activities that are of
concern to its stakeholders, who include patent practitioners.
Activities provided by state bars are generally provided to attorneys
registered with the state bar or to the clients of such attorneys. Most
state bars do not provide patent agents access to such activities, as
they are not registered with state bars. Thus, USPTO activities
governed by this Final Rule address, in part, a gap in services to
practitioners and their clients. Additionally, the USPTO provides free
patent legal training to practitioners, a
[[Page 46966]]
service that is distinct to patent practitioners.
Comment 128: Two commenters inquired whether the USPTO should
impose surcharges for pro se applicants due to the cost of examining
pro se applications.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 129: Two commenters stated that the USPTO has not provided
an accounting of the costs of the services provided for by the proposed
annual active patent practitioner fee and needs to do so. The commenter
stated that without a detailed cost accounting, the annual active
patent practitioner fee seems excessive to fund the current services
provided by the OED, especially when considered as an increase to
existing fees collected pursuant to 37 CFR 1.21(a)(1)-(10).
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 130: Two commenters stated that OED has been in existence
without the annual active patent practitioner fee and has never needed
the annual active patent practitioner fee, unlike state bars, which are
only funded by fee revenue from practicing attorneys. One of the
commenters stated the USPTO must be able to certify that the
requirement is ``necessary for the proper performance of the functions
of the agency.'' 44 U.S.C. 3506(c)(3)(A). One of the commenters
additionally stated that it is not a valid reason to impose the fee
because other jurisdictions do so. One commenter requested that the
USPTO provide a justification or reasoning for why establishing an
annual active patent practitioner fee is being implemented now, when a
similar proposal was made and not adopted in the 2000s.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 131: Two commenters stated that ensuring the accuracy of
OED's records can be accomplished by a periodic registration
requirement that does not require a fee, and OED already has the
authority under 37 CFR 11.11 to conduct periodic surveys of registered
practitioners, which would accomplish that goal.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. The USPTO must maintain accurate records regarding
the patent practitioners who practice before it for the benefit and
protection of the public. Patent practitioners are required under 37
CFR 11.11(a) to update their contact information within 30 days of the
date such information changed; however, many fail to do so. This
provision was in effect prior to this Final Rule and continues to be in
effect. Patent practitioner surveys have been conducted in the past,
and many patent practitioners have failed to respond at great expense
to the public and the USPTO. Thus, under this Final Rule, OED will be
able to maintain accurate records by having patent practitioners
electronically submit registration statements on which practitioners
will indicate whether they are currently in active status and list
their current contact information.
Comment 132: One commenter requested that, regarding the CLE
option, the Office state (1) whether the Office feels that there exist
major deficiencies in the corpus of practitioners in its practice
before the Office, (2) how CLE will solve these deficiencies, and (3)
any other justification for requiring CLE.
Response: This Final Rule does not require practitioners to
complete any CLE.
Comment 133: One commenter requested that the Office allow the
requirement to take CLE to expire after one or two years if the
benefits and goals of CLE are not attained.
Response: This Final Rule does not require patent practitioners to
complete CLE courses. Thus, it is left up to the individual patent
practitioner to evaluate the relative costs and benefits of taking CLE
courses to improve his or her patent legal skills and/or obtain
recognition in the online practitioner directory for completing CLE.
Comment 134: One commenter requested that the Office offer its own
free CLE programs in an electronically accessible format, such as a
web-based presentation, and ensure that such CLE programs complied with
each state bar's CLE requirements (for those states requiring CLE).
Response: The Office currently offers free CLE programs that
qualify for state bar credit in electronically accessible format. At
present, they are available under the ``Learning and Resources'' tab on
the uspto.gov web page. The Office will endeavor, where feasible, to
structure programs that would meet both the requirements for USPTO CLE
credit and the traditional requirements for CLE credit in other
jurisdictions.
Comment 135: Two commenters requested that, prior to instituting
the annual active patent practitioner fee and CLE option, the Office
analyze the option under the PRA. The commenters specifically requested
that the Office analyze the technical, administrative, and paperwork
burden imposed, as well as the justifications for such burdens, and
that the cost of the burdens would at least equal the benefits, and
that the practitioner fee is the least costly way to achieve those
benefits. Additionally, the commenters noted that the NPRM states that
the information collection requirements were reviewed under OMB control
nos. 0651-0012, 0651-0016, 0651-0020, 0651-0021, 0651-0031, 0651-0032,
0651-0033, 0651-0059, 0651-0063, 0651-0064, 0651-0069, and 0651-0075,
but none of these appear to relate to annual active patent practitioner
fees or CLE requirements. One of the commenters stated that such
collection requirements should be reviewed under 0651-0012, ``Admission
to Practice and Roster of Registered Patent Attorneys and Agents.''
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 136: One commenter inquired whether OED is prepared to
qualify seminars in the same manner that state bar associations qualify
seminars for both substantive and ethics-based CLE credits. The
commenter inquired whether OED will submit the materials to all 50
states and the District of Columbia for certification. One commenter
inquired as to whether, like state bars, the Office intends to charge
institutions for offering CLE programs that are in compliance with the
expectations and requirements of the Office for CLE certification.
Response: In the near future, the USPTO intends to issue proposed
CLE guidelines, with a request for public comments on them. It is
anticipated that the proposed guidelines will address issues including
qualification of CLE programs. However, the Office will endeavor, where
feasible, to structure programs it provides in accordance with the
traditional requirements for CLE credit in other jurisdictions.
Comment 137: A few commenters requested that the Office identify
the statutory authority allowing for defraying the patent-related costs
of operating OED by imposition of an annual active patent practitioner
fee, and also for the CLE requirement. One of the commenters states
that the NPRM is not explicit about the basis for setting the fee but
that it is suggested that it is
[[Page 46967]]
being set under the ``Other fees'' provisions of 35 U.S.C. 41(d)(2)(A).
The commenter requested the USPTO explain how the proposed fees involve
a service to the person being charged the fee in accordance with 31
U.S.C. 9701 (specifying that user fees must be set based on ``the value
of the service or thing to the recipient''). One of the commenters
stated that section 10 of the AIA prohibits the creation of new fees,
such as the annual active patent practitioner fee. One of the
commenters opined that the annual active patent practitioner fee and
CLE rules are not in compliance with E.O. 13771 (Reducing Regulation
and Controlling Regulatory Costs) (January 30, 2017). One of the other
commenters opined that the Independent Offices Appropriations Act of
1952 (IOAA) prohibits fees for general operating costs and that the
annual active patent practitioner fee does not meet the qualifications
for a ``transfer payment.''
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 138: Two commenters requested clarification of the scope of
acceptable patent and ethics CLE topics. One of these commenters
inquired as to where CLE credit could be obtained, and the projected
costs of attaining CLE credit. One commenter specifically inquired as
to whether patent law and practice courses could include courses on
estates and trusts, corporate regulation, and litigation-related
topics, and whether ethics courses could include those related to
substance abuse.
Response: In the near future, the USPTO intends to issue proposed
CLE guidelines, along with a request for public comment on them. It is
anticipated that the proposed guidelines will address the types of CLE
courses that may qualify for recognition in the online practitioner
directory. Generally, it is anticipated that a patent practitioner may
obtain eligible patent CLE credit for courses or activities on any
topic covered under 37 CFR 11.5(b)(1), including legal training which
relates to: Preparation and prosecution of patent applications,
patentability determinations and opinions, and drafting documents to be
presented for any patent-related proceeding before the USPTO. Other
topics that a practitioner may count toward the five patent CLE credits
include PTAB proceedings and patent litigation. Any course or activity
that is counted for ethics credit by any U.S. state or territorial bar,
including those of which the practitioner is not a member, may be
applied toward meeting the one hour of ethics CLE required for CLE
recognition in the online practitioner directory.
Comment 139: One commenter requested clarification on whether CLE
credit can be earned for giving presentations or writing an article or
paper on CLE topics.
Response: In the near future, the USPTO intends to issue proposed
CLE guidelines, along with a request for public comment on them. It is
anticipated that the proposed guidelines will address the specific
types of presentations or scholarly writing that may qualify for CLE
credit that counts toward recognition in the online practitioner
directory.
Comment 140: One commenter requested clarification on what is
considered pro bono work for the purposes of CLE certification. The
commenter additionally stated that pro bono service should not count
towards any CLE requirement because the pro bono patent client, unlike
other types of pro bono clients, is not facing an unaffordable
hardship; rather, the client is seeking an alternate form of venture
funding, and as a part of CLE, pro bono work does not enhance a
practitioner's legal skills any more than work for hire. Another
commenter stated that it is unclear how pro bono activities increase
legal acumen in order for it to justify those activities counting as
CLE credit in the CLE discount.
Response: The Final Rule provides that a registered practitioner or
person granted limited recognition may earn up to two of the five hours
of CLE in patent law and practice by participating in the USPTO Patent
Pro Bono Program. For every three hours of pro bono service, a patent
practitioner may earn one hour of CLE credit toward the five credits in
patent law and practice required for recognition in the online
practitioner directory. Section 32 of the AIA calls on the USPTO to
work with and support IP law associations to establish pro bono
programs. A pro bono patent client is generally not accepted into the
Patent Pro Bono Program unless their gross household income is less
than three times the federal poverty level guidelines. Moreover, the
Patent Pro Bono Program provides valuable learning opportunities for
less experienced and experienced practitioners alike by providing
volunteers the ability to obtain practical patent prosecution
experience representing under-resourced inventors who would otherwise
be unable to prosecute their patent applications. In addition, working
with patent pro bono clients provides an opportunity to gain experience
with clients who are less sophisticated in patent practice and
procedure than typical corporate clients. Under the Final Rule, taking
CLE courses or performing pro bono services as a part of the Patent Pro
Bono Program by patent practitioners is not required. Information
regarding the Patent Pro Bono Program is accessible at www.uspto.gov/probonopatents.
Comment 141: Two commenters questioned whether the Office will
audit practitioners for CLE compliance if they certify they have
completed CLE and, if so, what the statute of limitations on the audit
will be. One commenter opined that there is no limitation specified in
the NPRM, so a practitioner presumably must keep CLE records
indefinitely until retirement.
Response: The Office does not plan to audit practitioners who
certify they have completed CLE. If, however, a registered
practitioner's CLE compliance comes into question as part of a
grievance or a disciplinary investigation, then that practitioner may
be called upon to provide records of CLE completion. In the near
future, the USPTO intends to issue proposed CLE guidelines, with a
request for public comment on them. The proposed CLE guidelines will
address recommended standards of recordkeeping for practitioners who
wish to certify completion of CLE and obtain recognition in the online
practitioner directory.
Comment 142: One commenter requested clarification on whether the
annual active patent practitioner fee would be due on different dates
for each practitioner or by one date for all practitioners.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 143: One commenter inquired whether the annual active
patent practitioner fee could be paid and forms filled out by
administrative assistants or if each attorney would have to complete
some yet-to-be-designed electronic certification form.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. Correspondence with the Office must comply with the
requirements of 37 CFR 1.4.
Comment 144: One commenter inquired as to whether administratively
suspended practitioners would be locked out of accessing their files in
the PAIR system or in EFS-Web or both.
[[Page 46968]]
Commenters also inquired whether a response or application filed during
a period of non-compliance would be invalid and, if so, whether there
would be a mechanism for retroactively validating the documents to
prevent unintentional abandonment of applications or whether the remedy
would be to file an expensive request for revival of an unintentionally
abandoned application. Additionally, commenters questioned how
administrative suspension of a practitioner would affect clients'
rights and whether prosecution by an inadvertently suspended
practitioner would cause a patent resulting from that prosecution to be
invalid or unenforceable. The commenter further stated that any such
corrections would be administratively burdensome on the Office and the
practitioner.
Response: Administratively suspended practitioners would not be
able to access their USPTO online accounts and would be advised to
contact OED to resolve the suspension. Thus, if administratively
suspended, a practitioner would not be able to file documents
electronically. Filing documents while administratively suspended may
indicate the practitioner has engaged in the unauthorized practice of
law. If an application were to go abandoned due to a practitioner's
inability to file documents while administratively suspended, then
revival of the application may be necessary under 37 CFR 1.137.
Invalidity and unenforceability of patents are matters determined by
tribunals in particular litigations.
Comment 145: One commenter inquired as to what metrics indicate
that the annual active patent practitioner fee would improve patent
quality. Another commenter suggested that the USPTO's resources would
be better spent in the interest of the patent community on issues that
the USPTO is in the best position to address, such as assuring patent
quality. Another commenter suggested that by practitioners passing the
fee onto applicants, some applicants may reduce their reliance on
patent practitioners, resulting in a decrease in patent quality.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 146: One commenter requested an explanation of how the
annual active patent practitioner fee was calculated.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 147: Two commenters opined that the proposed $70 fee
charged of practitioners in voluntary inactive status is too high for
maintaining a database and updating it once a year and that
practitioners would not get a benefit equal to the fee. Two commenters
do not support charging a voluntary inactive fee. One commenter stated
that imposing an inactive patent practitioner fee is bad public policy
because many semi-retired practitioners volunteer to mentor younger
attorneys or to advise small businesses, and the fee would discourage
semi-retired practitioners from staying active in the profession.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time. Accordingly, the USPTO also will not implement the
proposed fee for patent practitioners in voluntary inactive status.
Comment 148: One commenter stated that the beneficiaries of the OED
disciplinary system are the Office and patent applicants, not the
registered practitioners.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the proposed annual active patent practitioner
fee at this time.
Comment 149: One commenter stated that the USPTO argued to be an
exception to the requirements of 5 U.S.C. 500(e), not because of the
need for a second disciplinary authority to regulate conduct, but by
reasoning that the USPTO and patent applicants would be better served
by placing additional skill requirements on patent practitioners. H.R.
Rep. No. 1141, 89th Cong., 1st Sess. (1965), reprinted in 1965
U.S.C.C.A.N. 4170, 4172-74, 4176-77, 4179; William H. Sager & Leslie S.
Shapiro, Administrative Practice Before Federal Agencies, 4 U. Rich. L.
Rev. 76, 82 (1969).
Response: Pursuant to 35 U.S.C. 2(b) and 35 U.S.C. 32, the Office
has statutory authority to promulgate regulations governing the conduct
of patent practitioners and suspend or exclude them for misconduct.
Comment 150: One commenter stated that trademark attorneys should
pay the same annual active patent practitioner fee that patent
practitioners are being asked to pay because OED administers
disciplinary proceedings against trademark attorneys.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
Comment 151: One commenter strongly supports an adequately and
properly funded OED.
Response: The Office appreciates the comment. The patent fee
adjustments in this Final Rule are intended to provide the Office with
a sufficient amount of aggregate revenue to recover the aggregate cost
of patent operations, including the costs of OED services related to
patent matters.
Comment 152: One commenter stated that the annual active patent
practitioner fee would provide increased funding to OED and would like
to know what issues OED intends to address with the increased funding.
The commenter also indicated that funding from the annual active patent
practitioner fee should not be used to expand the role of OED per se to
include any active investigation of practitioners that is not linked to
a complaint or to a notification from a state bar association. The
commenter also stated that since the annual active patent practitioner
fee eliminates the need for the Office to perform surveys of
practitioners, the cost of conducting the survey should be reflected as
a savings to the Office and should be reflected in any cost accounting
justifying the annual active patent practitioner fee.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
Comment 153: One commenter inquired whether OED could recover some
of its funding by increasing the fees it already charges instead of
charging the annual active patent practitioner fee. The commenter gave
examples of an application fee for admission to the examination for
registration, a fee for administering the registration examination, and
a fee for recognition or registration after disbarment or suspension on
ethical grounds.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time. In addition, the fees cited by the commenter are enrollment
fees, which are only being adjusted by the approximately 5 percent
across-the-board adjustment to patent fees. A larger targeted
adjustment of enrollment fees went into effect in the January 2018
Final Rule.
Comment 154: One commenter requested that the USPTO address the
specific OED services and other services that will be funded by the
annual active
[[Page 46969]]
patent practitioner fee and how the collected funds will be applied to
those services.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
Comment 155: One commenter stated that the Office estimates that
the annual active patent practitioner fee will raise $10-$11 million
per year and that this amount seems excessive to fund the patent-
related services provided by the OED, especially when considered as an
increase to the existing fees collected pursuant to 37 CFR 1.21(a)(1)-
(10).
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
Comment 156: Two commenters requested details on the expenses for
the Law School Clinic Certification Program and the Patent Pro Bono
Program and on how the funds from the annual active patent practitioner
fee will be applied to these expenses.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
Comment 157: One commenter stated that funds collected from the
annual active patent practitioner fee will be used both for existing
OED programs and to implement new programs and inquired to what extent
would the expense of administrating the annual active patent
practitioner fee take resources away from other programs.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
Comment 158: Two commenters welcomed the provision in the NPRM that
states that only practitioners who have been resigned for more than two
years would need to retake the registration exam.
Response: As noted in the comment, the Final Rule eliminates the
requirement that a registered practitioner who is administratively
suspended for more than two years take and pass the registration
examination in order to be reinstated. Under the Final Rule, resigned
practitioners will only have to retake and pass the registration
examination if they have been resigned for more than five years and
cannot provide other objective evidence that they continue to possess
the necessary legal qualifications to render valuable service to patent
applicants.
Comment 159: One commenter stated that many practitioners will
forego the CLE discount in order to avoid determining how to comply and
document CLE compliance.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time and thus, there is no CLE discount in this Final Rule.
Comment 160: One commenter questioned what the consequences would
be for a CLE certification that does not meet OED's standards and how
disagreements regarding the challenged certification would be resolved.
Response: Practitioners will self-certify their completion of six
credits of CLE, including five credits of CLE in patent law and
practice and one credit of CLE in ethics. In the near future, the
Office plans to issue proposed CLE guidelines, with a request for
public comment on them that will address what types of CLE may qualify
for CLE recognition. OED does not intend to audit practitioners who
certify completion of CLE or review whether courses completed by a
practitioner who certified completion of CLE in fact qualify for the
certification. It is anticipated that such review would only take place
for cases in which OED receives a grievance alleging that a patent
practitioner falsely or fraudulently certified completion of CLE or
where the submission was obviously noncompliant. Registered patent
practitioners and those granted limited recognition to practice before
the Office in patent matters are subject to the USPTO Rules of
Professional Conduct, including 37 CFR 11.804(c), which prohibits
conduct that involves dishonesty, fraud, deceit, or misrepresentation.
Comment 161: One commenter questioned what effect an invalid CLE
certification would have on patent validity or enforceability.
Response: It appears that the comment anticipates a scenario in
which a patent practitioner claims the CLE credit but is subsequently
found not to have satisfied the requirements for claiming the credit.
Under the Final Rule, a practitioner may certify completion of CLE in
order to obtain recognition in the online patent practitioner
directory. No administrative suspension would result from an
``invalid'' or mistaken CLE certification. Thus, it is not anticipated
that an ``invalid'' or mistaken CLE certification would affect patent
validity or enforceability.
Comment 162: One commenter inquired how the regulatory and
compliance costs of the CLE discount will affect the annual active
patent practitioner fee. One commenter was concerned that the Office
will use oversight of the CLE certification as justification for the
annual active patent practitioner fee and any future increases thereto.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
Comment 163: One commenter is concerned that the Office's proposed
model of three hours of pro bono service to obtain one hour of CLE
credit does not sufficiently reflect the importance and value of pro
bono service and recommends providing one hour of CLE credit for each
hour of pro bono service in the USPTO Patent Pro Bono Program.
Response: This comment has not been adopted. According to the
Standing Committee on Pro Bono & Public Service of the American Bar
Association, of the states that offer CLE credit for pro bono service,
the most common rate that is used for earning such credits is five
hours of service for each CLE credit. No state offers one hour of CLE
credit for each hour of pro bono service. Thus, one hour of CLE credit
for every three hours of pro bono service is generally above the amount
of CLE credit that states offer for pro bono service. In the near
future, the USPTO intends to issue proposed CLE guidelines, with a
request for public comments on them.
Comment 164: One commenter stated that requiring a practitioner to
retake the registration examination for failure to update their
information with OED is equivalent to the penalty of disbarment and
therefore grossly disproportionate to the offense. Instead, the
commenter requests that the penalty for failing to update contact
information be an extra charge to reinstate, based on the back fees
missed and extra administration costs incurred.
Response: Administratively suspended practitioners will only have
to retake the examination if they have been suspended for more than
five years and cannot provide other objective evidence that they
continue to possess the necessary legal qualifications to render
valuable service to patent applicants.
Legal Considerations
Comment 165: One commenter stated that RCE fees are governed by the
IOAA, except for the one requirement that is carved out by section 10
of the AIA. Thus, the USPTO may charge actual cost, plus a proportional
share of
[[Page 46970]]
general administrative costs, reduced by a proportional share of issue
and maintenance fees, but no more than that. The excess charge for
second and subsequent RCEs is unlawful.
Response: The IOAA provides federal agencies the authority to
charge user fees where the agencies do not have their own specific
statutory authority to charge fees. Fees collected under the IOAA are
deposited in the general fund of the U.S. Treasury and not available to
the charging agency for its use. OMB Circular A-25, User Charges,
provides guidance on IOAA authority. This has no relevance to the fee
setting authority provided to the USPTO, as the USPTO has specific
statutory authority to charge fees under title 35 of the U.S.C. and the
Trademark Act of 1946. The USPTO further has specific authority to set
and adjust those fees as in the current rulemaking under section 10 of
the AIA. Fees collected by the USPTO are made available to the USPTO
through annual appropriations and are available to use for the
activities that generated the fee (patent and trademark examination and
proportionate administrative expenses). The general authority described
in the IOAA and OMB Circular A-25 is not relevant to the USPTO's
specific fee setting authority.
Comment 166: One commenter disagreed with the RIA regarding the
annual active patent practitioner fee and non-DOCX surcharge fee. The
commenter stated that the point of the rule is to raise fees and
disagreed with findings of ``No identified costs.'' The commenter
suggested comment letters sent to PPAC identified substantial costs to
the public for the annual active patent practitioner fee and non-DOCX
surcharge fee. The commenter further wrote that the OMB's Implementing
Guidance puts the annual active patent practitioner fee and non-DOCX
surcharge fee within the scope of E.O. 13771, which states:
``Regulatory actions [that] impose requirements apart from transfers .
. . need to be offset to the extent they impose more than de minimis
costs.''
Response: Guidance in OMB Circular A-4, Regulatory Analysis, and
concerning RIAs provides that fees to government agencies for goods or
services are considered transfer payments. The fee adjustments concern
increases of fees for USPTO services, which are transfers, not costs.
The non-DOCX surcharge fee is based on the services provided by the
USPTO to patent applicants and, consequently, qualifies as a transfer
payment under OMB's guidance. As noted in response to Comment 81 above,
the USPTO has elected not to implement the annual active patent
practitioner fee at this time.
Comment 167: One commenter stated that the legislative history of
the AIA makes abundantly clear that the USPTO may not use fee setting
as a policy lever. Fee setting may only be used to recover aggregate
costs. The commenter further stated that the U.S. Constitution denies
agencies the authority to set fees for anything other than cost
recovery--setting fee levels to ``encourage or discourage'' is a
``tax''; agencies do not have the authority to tax, and, therefore,
fees being set to incentivize, disincentivize, and ``to facilitate the
effective administration of the patent and trademark systems,'' are not
within the statutory authority of the USPTO.
Response: The AIA permits individual patent fees to be set or
adjusted to encourage or discourage particular services, so long as the
aggregate revenues for all patent fees recover the aggregate costs of
the patent operation. The comment would read into the AIA limitations
that do not exist and that are inconsistent with the AIA.
Comment 168: One commenter wanted to know why the USPTO has never
issued any legal analysis of the AIA's legislative history. The
commenter cited two examples: The removal of ``notwithstanding the fee
amounts established or charged'' from the AIA and the discussion in the
House report (H.R. Rep. No. 112-98), and the effect of the word
``only'' in the phrase ``only to recover the aggregate estimated
costs.'' The commenter believed the legislative history makes clear
that Congress intended ``only'' to apply to purpose as well as amount.
Response: A legal analysis of legislative history is unnecessary in
light of the plain language of the AIA, which permits individual patent
fees to be set or adjusted to encourage or discourage particular
services, so long as the aggregate revenues for all patent fees recover
the aggregate costs of the patent operation.
Comment 169: One commenter expressed that the fee setting efforts
of the USPTO are unconstitutional because the U.S. Constitution denies
agencies the authority to set fees for anything other than cost
recovery--setting fee levels to ``encourage or discourage'' behavior is
a ``tax,'' and agencies do not have the authority to tax (see
Sec. Sec. I.B.1 and I.C). Even with authority under the AIA, the USPTO
may not ``adjust assessments to encourage or discourage a particular
activity'' because the U.S. Constitution provides that the power to
``lay and collect taxes'' lies with the U.S. Congress, not the
executive branch.
Response: Patent fees are paid for receiving and maintaining a
patent grant. Courts have held that the payment of such fees should not
be viewed as taxes but rather payments for a service.
Comment 170: One commenter wrote that the USPTO may not create new
fees where no fees are ``established, authorized, or charged'' in title
35 and there is no affirmative material, service, or processing
provided. Similarly, the commenter wrote that the USPTO may not re-
allocate fees among the categories specified in Sec. 41; new fees may
be created only where the USPTO has a specific statutory authorization
(see Sec. I.B.2).
Response: The AIA permits individual patent fees to be set or
adjusted to encourage or discourage particular services, so long as the
aggregate revenues for all patent fees recover the aggregate costs of
the patent operation. The comment would read into the AIA limitations
that do not exist and that are inconsistent with the AIA.
Comment 171: One commenter stated that this rulemaking exceeds the
authority of the USPTO because it overrides a policy decision made by
the U.S. Congress in favor of something the USPTO prefers. The
commenter contended the U.S. Congress made a policy choice: Initial
filings should be cross-subsidized by maintenance fees at approximately
50 percent. The U.S. Congress (by inference) felt it important to
encourage filing and allow successful patentees to cross-subsidize
filing. The commenter also felt the USPTO is exceeding its authority
because it is second-guessing the U.S. Congress's policy balances
encoded in the appeal fee line. The commenter suggested this rulemaking
relies on ``factors which Congress has not intended [the agency] to
consider,'' making it an arbitrary and capricious agency action under
the APA. The commenter believed the USPTO departed from the intent of
the U.S. Congress in 2013 and should revert to the pre-2013 fee
structure.
Response: The USPTO has specific statutory authority to charge fees
under title 35 of the U.S.C. and the Trademark Act of 1946. The USPTO
further has specific authority to set and adjust those fees as in this
Final Rule under section 10 of the AIA. The AIA permits individual
patent fees to be set or adjusted to encourage or discourage particular
services, so long as the aggregate revenues for all patent fees recover
the aggregate costs of the patent operation. However, the USPTO notes
that the adjustments to the fee schedule
[[Page 46971]]
do not significantly impact the balance between front-end and back-end
fees.
Comment 172: One commenter agreed in principle with the operating
reserve of the USPTO but saw no statutory authorization for it. The
commenter contended the operating reserve is not fairly within the text
of section 10 of the AIA, which limits USPTO fee collections to
``only'' aggregate costs.
Response: The AIA permits individual patent fees to be set or
adjusted to encourage or discourage particular services, so long as the
aggregate revenues for all patent fees recover the aggregate costs of
the patent operation. One of these aggregate costs is the growth of an
operating reserve to allow effective management of the U.S. patent
system and responsiveness to changes in the economy, unanticipated
production workload, and revenue changes, while maintaining operations
and effectuating long-term strategies.
Comment 173: One commenter stated that the NPRM for this rulemaking
ignores the IOAA and OMB Circular A-25, which are the general framework
statute and Presidential interpretation, respectively, for agencies
that charge user fees. The commenter claimed the IOAA limits user fees
to cover services to a specific ``identifiable recipient,'' at the cost
of providing that service or the value to the recipient, but may not
recover agency general operating costs. The commenter also stated that
fees without statutory grounding are not within section 10 of the AIA
and thus are either barred outright or are subject to the constraints
of the IOAA. The commenter suggested that relevant Supreme Court and
D.C. Circuit case law holdings--especially Seafarers International
Union of North America v. U.S. Coast Guard, 81 F.3d 179, 183 (D.C. Cir.
1996)--are opposite to the position the USPTO takes in the NPRM.
Response: The IOAA provides federal agencies the authority to
charge user fees where the agencies do not have their own specific
statutory authority to charge fees. Fees collected under the IOAA are
deposited in the general fund of the U.S. Treasury and not available to
the charging agency for its use. OMB Circular A-25 provides guidance on
IOAA authority. This has no relevance to the fee setting authority of
the USPTO, as the USPTO has specific statutory authority to charge fees
under title 35 of the U.S.C. and the Trademark Act of 1946. The USPTO
further has specific authority to set and adjust those fees as in this
Final Rule under section 10 of the AIA. Fees collected by the USPTO are
made available to the USPTO through annual appropriations and are
available to use for the activities that generated the fee (patent and
trademark services and proportionate administrative expenses). The
general authority described in the IOAA and OMB Circular A-25 is not
relevant to the USPTO's specific fee setting authority.
Comment 174: One commenter expressed that a change undertaken in a
previous rulemaking, changing ``notice of appeal'' and ``filing a brief
in support of an appeal'' of Sec. 41(a)(6), was unlawfully
restructured into ``notice of appeal'' and ``forwarding an appeal to
the Board'' as in 37 CFR 41.20(b)(1) and (4).
Response: The USPTO has specific authority to set and adjust fees,
as in the current rulemaking, under section 10 of the AIA. The AIA
permits individual patent fees to be set or adjusted so long as the
aggregate revenues for all patent fees recover the aggregate costs of
the patent operation.
Comment 175: One commenter wrote that section 1(b)(2) of E.O. 12866
requires the USPTO to ``examine whether existing regulations (or other
law) have created, or contributed to, the problem that a new regulation
is intended to correct.'' Most of the policy goals of the fee schedule
could be addressed by internal reforms to reduce costs, as an
alternative to raised fees. For example, internal USPTO processes and
incentives could be restructured to reduce costs to the USPTO and
applicants. The commenter contends that the NPRM identifies no
exemption from E.O. 12866 that permits the USPTO to forego this
examination.
Response: The USPTO is in compliance with all procedural and
analytical requirements of E.O. 12866. The USPTO identified no existing
regulation that created or contributed to the need for this Final Rule.
In this Final Rule, the USPTO is not creating any new regulation.
Rather, the USPTO is setting and adjusting patent fees based on
assumptions found in the FY 20201 Budget in order to recover the
aggregate cost of patent operations in future years and to allow the
Office to continue progress towards achieving strategic goals. Also,
contrary to the assertion made in the comment, the Office is constantly
considering its operations, policies, and processes to identify ways to
improve its operations. As an example, the Office recently issued a
Notice of Proposed Rulemaking, Removal of Regulations Governing
Requests for Presidential Proclamations under the Semiconductor Chip
Protection Act of 1984 and Certain Rules of Practice Relating to
Registration to Practice and Discipline, 84 FR 64800 (November 25,
2019), that eliminated unnecessary regulations. To support this
regulatory reform effort, the Office assembled a working group
consisting of subject-matter experts from each of the business units
that implement the Office's regulations. The working group considered,
reviewed, and recommended ways that the regulations could be improved,
revised, and streamlined so as to improve the operation of the Office.
The working group reviewed existing regulations, both discretionary
rules and those required by statute or judicial order. The USPTO also
solicited comments from stakeholders through a web page established to
provide information on the USPTO's regulatory reform efforts. These
efforts led to the development of candidate regulations for removal,
based on the USPTO's assessment that these regulations were not needed
and/or that elimination could improve the USPTO's body of regulations.
As an additional example, the Office recently implemented adjustments
to examination time to improve the examination process and examination
quality. These time adjustments include increasing baseline examination
time and providing additional examination time based on newly developed
application attributes, such as the number of claims, size of the
specification, number of pages of prior art citations submitted, etc.
Additional examples of how the USPTO is constantly taking steps to
improve processes, increase efficiency, and reduce costs, for both
applicants and the USPTO, include our international cooperation
programs, such as the Electronic Priority Document Exchange Program and
the Global Dossier Program. Furthermore, efficiencies and cost savings
have been realized as a result of the USPTO implementing ePetitions and
the Access to Relevant Prior Art Initiative.
Comment 176: One commenter stated section 1(b)(2) of E.O. 12866
directs agencies to ``examine whether existing regulations (or other
law) have created, or contributed to, the problem that a new regulation
is intended to correct.'' In 2012, the USPTO requested comment on RCE
practice. Several of the comment letters noted that, at least in part,
extended RCE practice was driven by a breakdown of ``compact
prosecution''--Office actions were less complete, less careful, and
less responsive to applicants' arguments. The commenter observed no
effort by the USPTO to address its ``existing regulation'' half of the
problem--for example, the USPTO has not recalibrated the count system
to remove
[[Page 46972]]
incentives for gaming by examiners or provided sound supervision to
ensure completeness of Office actions. E.O. 12866 suggests that it is
inappropriate to shift costs to the public for a failure of the USPTO
to implement its own self-regulatory obligations.
Response: In this Final Rule, the USPTO is not creating any new
regulations; rather, the USPTO is setting and adjusting patent fees in
order to recover its increasing aggregate costs. Contrary to the
position set forth in the comments, the Office is not shifting costs to
the public. Since 2012, the Office has made considerable efforts to
improve patent quality, including establishing the Office of the Deputy
Commissioner for Patent Quality (DCPQ) within the Patents organization.
The DCPQ is responsible for optimizing the quality of patent products,
processes, and services to build a culture of process improvement and
enhanced patent quality for the Patents organization. In addition to
establishing this new office within the Patents organization, patent
examiners have received extensive training on how to improve the
quality of their Office actions. These trainings include a three-part
training on how to evaluate, analyze, and respond to arguments
presented by applicants. They also include training on interpreting
claims, establishing a clear prosecution record in an application, and
writing proper reasons for allowance. Also, contrary to the comments,
the Office recently implemented adjustments to examination time to
improve the examination process and examination quality. These time
adjustments include increasing baseline examination time and providing
additional examination time based on newly developed application
attributes, such as the number of claims, size of specification, number
of pages of prior art citations submitted, etc.
Comment 177: One commenter stated that the USPTO did not meet its
rulemaking obligation to disclose rationale. The commenter contended
that even if there is a sound cause-and-effect relationship between the
proposal and the asserted benefits, it is not explained in the NPRM,
making it arbitrary and capricious under the APA.
Response: The Office disagrees that it failed to disclose the
rationale for the rulemaking or that the rulemaking is arbitrary and
capricious under the APA. The preamble and regulatory text clearly set
forth the new costs and explain the rationale for each change in
compliance with the requirements of the APA.
Comment 178: One commenter disagreed with the finding that this
rulemaking is a ``transfer payment from one group to another.'' The
commenter wrote that the definition of ``transfer payment'' is in OMB
Circular A-4 and the original definition involved cash payments to
private sector actors, and the definition has grown to cover other
direct cash transfers among private sector entities. The commenter
continued that the NPRM calls for funds to be paid from private sector
persons to government for government consumption and discusses no
monetary payout to any private sector party.
Response: Guidance in OMB Circular A-4 and concerning RIAs provides
that fees to government agencies for goods or services are considered
transfer payments. The fee adjustments concern increases of fees for
USPTO services, which are transfers, not costs. Pursuant to the
requirements of E.O. 12886, the USPTO submitted both the NPRM and RIA
to the OMB for review prior to publication. The OMB determined that
this rulemaking consisted entirely of transfer payments from one group
to another, as defined in OMB Circular A-4.
Comment 179: One commenter wondered why there was not an analysis
of raising all fees proportionally from the baseline set by Congress,
with deviations only where the USPTO has specific data to support a
deviation. The commenter contended that this analysis is required by
statute and the U.S. Constitution.
Response: The alternatives considered in the RIA are reasonable
alternatives that are consistent with guidance in OMB Circular A-4.
Among the alternatives considered was an across-the-board adjustment to
the current baseline fee schedule.
Comment 180: One commenter stated the RIA accompanying the NPRM
only considers non-starter alternatives like not raising fees at all,
setting all fees at actual cost, and applying only an inflation
adjustment. The commenter contended these are unrealistic strawmen,
against which the USPTO's preferred alternative appears favorable.
Considering only unrealistic strawmen as ``alternatives'' is not
compliant with the USPTO's obligations under the letter of the law and
cannot be reconciled with the ``regulatory philosophy'' or spirit of
the law. Artificially narrowing the options is arbitrary and capricious
per se.
Response: The alternatives considered in the RIA are reasonable
alternatives that are consistent with guidance in OMB Circular A-4.
Comment 181: One commenter questioned why there was no analysis of
the proportional lockstep fee hike relative to Sec. 41 as a baseline.
Response: Among the alternatives considered in the RIA is a
lockstep, across-the-board adjustment to the current baseline fee
schedule.
Comment 182: One commenter stated that the USPTO may not set fees
without a benefit-cost analysis under the PRA and E.O. 12866--for
example, the USPTO may not reduce its own costs if that would increase
costs on the public disproportionately (see Sec. I.F).
Response: The USPTO must comply with all rulemaking requirements
when setting fees using the authority provided by section 10 of the
AIA. As demonstrated in the Rulemaking Considerations section of this
Final Rule, and in this rulemaking as a whole, the USPTO has complied
with these requirements.
Comment 183: One commenter expressed that several components of
this rulemaking implicate the PRA (e.g., the DOCX proposal and the
annual active patent practitioner fee). The NPRM asserts that the USPTO
has obtained PRA clearance, but the commenter contends this assertion
is false, and the USPTO has never even applied for clearance.
Response: The USPTO must comply with the PRA in setting fees using
the authority provided by section 10 of the AIA. The USPTO has filed
with the OMB a worksheet addressing costs in compliance with the
requirement of the statute.
Comment 184: One commenter claimed the USPTO has made no filing
seeking any substantive change to 0651-0012 since 2014.
Response: The USPTO has complied with the PRA in considering the
paperwork burdens associated with this Final Rule. The USPTO has
previously received OMB approval for associated burdens and submitted
additional statements to address revisions.
VII. Discussion of Specific Rules
The following section shows the Code of Federal Regulations (CFR)
for all fees set or adjusted in this Final Rule. The discussion below
includes all fee amendments, all fee discontinuations, and all changes
to the CFR text.
Title 37 of the CFR, parts 1, 11, 41, and 42, are amended as
follows:
Section 1.16: Section 1.16 is amended by revising paragraphs (a)
through (e), (h), (j), (k), and (m) through (s) and adding paragraph
(u) to set forth the application filing, excess claims, search, and
examination fees for patent applications filed as authorized under
section 10 of the Act. The changes to the
[[Page 46973]]
fee amounts indicated in Sec. 1.16 are shown in Table 11.
Table 11--CFR Section 1.16 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees
--------------------------- (dollars)
CFR section Fee code Description --------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.16(a)........................... 1011/2011/3011...................... Basic filing fee-- 300 150 75 320 160 80
Utility (paper filing
also requires non-
electronic filing fee
under 1.16(t)).
1.16(a)........................... 4011................................ Basic filing fee-- n/a 75 n/a n/a 80 n/a
Utility (electronic
filing for small
entities).
1.16(b)........................... 1012/2012/3012...................... Basic filing fee--Design 200 100 50 220 110 55
1.16(b)........................... 1017/2017/3017...................... Basic filing fee--Design 200 100 50 220 110 55
(CPA).
1.16(c)........................... 1013/2013/3013...................... Basic filing fee--Plant. 200 100 50 220 110 55
1.16(d)........................... 1005/2005/3005...................... Provisional application 280 140 70 300 150 75
filing fee.
1.16(e)........................... 1014/2014/3014...................... Basic filing fee-- 300 150 75 320 160 80
Reissue.
1.16(e)........................... 1019/2019/3019...................... Basic filing fee-- 300 150 75 320 160 80
Reissue (Design CPA).
1.16(h)........................... 1201/2201/3201...................... Each independent claim 460 230 115 480 240 120
in excess of three.
1.16(h)........................... 1204/2204/3204...................... Each reissue independent 460 230 115 480 240 120
claim in excess of
three.
1.16(j)........................... 1203/2203/3203...................... Multiple dependent claim 820 410 205 860 430 215
1.16(k)........................... 1111/2111/3111...................... Utility Search Fee...... 660 330 165 700 350 175
1.16(m)........................... 1113/2113/3113...................... Plant Search Fee........ 420 210 105 440 220 110
1.16(n)........................... 1114/2114/3114...................... Reissue Search Fee or 660 330 165 700 350 175
Reissue (Design CPA)
Search Fee.
1.16(o)........................... 1311/2311/3311...................... Utility Examination Fee. 760 380 190 800 400 200
1.16(p)........................... 1312/2312/3312...................... Design Examination Fee 600 300 150 640 320 160
or Design CPA
Examination Fee.
1.16(q)........................... 1313/2313/3313...................... Plant Examination Fee... 620 310 155 660 330 165
1.16(r)........................... 1314/2314/3314...................... Reissue Examination Fee 2,200 1,100 550 2,320 1,160 580
or Reissue (Design CPA)
Examination Fee.
1.16(s)........................... 1081/2081/3081...................... Utility Application Size 400 200 100 420 210 105
Fee--for each
additional 50 sheets
that exceeds 100 sheets.
1.16(s)........................... 1081/2081/3081...................... Design Application Size 400 200 100 420 210 105
Fee--for each
additional 50 sheets
that exceeds 100 sheets.
1.16(s)........................... 1081/2081/3081...................... Plant Application Size 400 200 100 420 210 105
Fee--for each
additional 50 sheets
that exceeds 100 sheets.
1.16(s)........................... 1081/2081/3081...................... Reissue Application Size 400 200 100 420 210 105
Fee--for each
additional 50 sheets
that exceeds 100 sheets.
1.16(s)........................... 1081/2081/3081...................... Provisional Application 400 200 100 420 210 105
Size Fee--for each
additional 50 sheets
that exceeds 100 sheets.
1.16(u)........................... NEW................................. Non-DOCX Filing n/a n/a n/a 400 200 100
Surcharge Fee.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.17: Section 1.17 is amended by revising paragraphs (a),
(c) through (g), (i)(2), (k), (m), (p), (q), (r), and (s) to set forth
the application processing fees as authorized under section 10 of the
Act. The changes to the fee amounts indicated in Sec. 1.17 are shown
in Table 12. In this Final Rule, an existing fee code has been added to
Table 12 for the petition for the extension of the twelve-month (six-
month for designs) period for filing a subsequent application. This is
not a new fee code created in this rule; rather, it reflects existing
practice. In this section, table headers were added to make formatting
consistent.
Table 12--CFR Section 1.17 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees
--------------------------- (dollars)
CFR section Fee code Description --------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.17(a)(1)........................ 1251/2251/3251...................... Extension for response 200 100 50 220 110 55
within first month.
1.17(a)(2)........................ 1252/2252/3252...................... Extension for response 600 300 150 640 320 160
within second month.
1.17(a)(3)........................ 1253/2253/3253...................... Extension for response 1,400 700 350 1,480 740 370
within third month.
1.17(a)(4)........................ 1254/2254/3254...................... Extension for response 2,200 1,100 550 2,320 1,160 580
within fourth month.
1.17(a)(5)........................ 1255/2255/3255...................... Extension for response 3,000 1,500 750 3,160 1,580 790
within fifth month.
1.17(c)........................... 1817/2817/3817...................... Request for prioritized 4,000 2,000 1,000 4,200 2,100 1,050
examination.
1.17(d)........................... 1819/2819/3819...................... Correction of 600 300 150 640 320 160
inventorship after
first action on merits.
1.17(e)(1)........................ 1801/2801/3801...................... Request for continued 1,300 650 325 1,360 680 340
examination (RCE)--1st
request (see 37 CFR
1.114).
1.17(e)(2)........................ 1820/2820/3820...................... Request for continued 1,900 950 475 2,000 1,000 500
examination (RCE)--2nd
and subsequent requests
(see 37 CFR 1.114).
1.17(f)........................... 1462/2462/3462...................... Petitions requiring the 400 200 100 420 210 105
petition fee set forth
in 37 CFR 1.17(f)
(Group I).
1.17(g)........................... 1463/2463/3463...................... Petitions requiring the 200 100 50 220 110 55
petition fee set forth
in 37 CFR 1.17(g)
(Group II).
1.17(i)(2)........................ 1803/2803/3803...................... Request for voluntary 130 130 130 140 140 140
publication or
republication.
1.17(i)(2)........................ 1808/2808/3808...................... Other publication 130 130 130 140 140 140
processing fee.
1.17(k)........................... 1802/2802/3802...................... Request for expedited 900 450 225 1,600 800 400
examination of a design
application.
[[Page 46974]]
1.17(m)........................... 1453/2453/3453...................... Petition for revival of 2,000 1,000 500 2,100 1,050 525
an abandoned
application for a
patent, for the delayed
payment of the fee for
issuing each patent, or
for the delayed
response by the patent
owner in any
reexamination
proceeding.
1.17(m)........................... 1454/2454/3454...................... Petition for the delayed 2,000 1,000 500 2,100 1,050 525
submission of a
priority or benefit
claim.
1.17(m)........................... 1784/2784/3784...................... Petition to excuse 2,000 1,000 500 2,100 1,050 525
applicant's failure to
act within prescribed
time limits in an
international design
application.
1.17(m)........................... 1558/2558/3558...................... Petition for the delayed 2,000 1,000 500 2,100 1,050 525
payment of the fee for
maintaining a patent in
force.
1.17(m)........................... 1628/2628/3628...................... Petition for the 2,000 1,000 500 2,100 1,050 525
extension of the twelve-
month (six-month for
designs) period for
filing a subsequent
application.
1.17(p)........................... 1806/2806/3806...................... Submission of an 240 120 60 260 130 65
Information Disclosure
Statement.
1.17(r)........................... 1809/2809/3809...................... Filing a submission 840 420 210 880 440 220
after final rejection
(see 37 CFR 1.129(a)).
1.17(s)........................... 1810/2810/3810...................... For each additional 840 420 210 880 440 220
invention to be
examined (see 37 CFR
1.129(b)).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.18: Section 1.18 is amended by revising paragraphs (a)
through (f) to set forth the patent issue fees as authorized under
section 10 of the Act. The changes to the fee amounts indicated in
Sec. 1.18 are shown in Table 13.
Table 13--CFR Section 1.18 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees
--------------------------- (dollars)
CFR section Fee code Description --------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.18(a)(1)........................ 1501/2501/3501...................... Utility issue Fee....... 1,000 500 250 1,200 600 300
1.18(a)(1)........................ 1511/2511/3511...................... Reissue issue Fee....... 1,000 500 250 1,200 600 300
1.18(b)(1)........................ 1502/2502/3502...................... Design issue Fee........ 700 350 175 740 370 185
1.18(c)(1)........................ 1503/2503/3503...................... Plant Issue Fee......... 800 400 200 840 420 210
1.18(d)(3)........................ 1505/2505/3505...................... Publication fee for 300 300 300 320 320 320
republication.
1.18(e)........................... 1455/2455/3455...................... Filing an application 200 200 200 210 210 210
for patent term
adjustment.
1.18(f)........................... 1456/2456/3456...................... Request for 400 400 400 420 420 420
reinstatement of term
reduced.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.19: Section 1.19 is amended by revising paragraphs
(b)(1)(i)(B) and (b)(1)(ii)(B) and by removing and reserving paragraphs
(j) through (l) to set forth the patent document supply fees as
authorized under section 10 of the Act. The changes to the fee amounts
indicated in Sec. 1.19 are shown in Table 14.
Table 14--CFR Section 1.19 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description --------------------------------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.19(b)(1) (i)(B).......... 8051......................... Copy patent file 280 280 280 290 290 290
wrapper, paper
medium, any
number of sheets.
1.19(b)(1) (ii)(B)......... 8052......................... Copy patent file 55 55 55 60 60 60
wrapper,
electronic
medium, any size
or provided
electronically.
1.19(j).................... 8057......................... Copy of Patent 50 50 50 discontinued discontinued discontinued
Technology
Monitoring Team
(PTMT) patent
bibliographic
extract and
other DVD
(optical disc).
1.19(k).................... 8058......................... Copy of U.S. 100 100 100 discontinued discontinued discontinued
patent custom
data extracts.
1.19(l).................... 8059......................... Copy of selected 30 30 30 discontinued discontinued discontinued
technology
reports,
miscellaneous
technology areas.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.20: Section 1.20 is revised to set forth post-issuance
fees as authorized under section 10 of the Act. In this section, (c)(5)
through (7) are being reinstated due to an inadvertent deletion. The
changes to the fee amounts indicated in Sec. 1.20 are shown in Table
15.
[[Page 46975]]
Table 15--CFR Section 1.20 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description -----------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.20(a)........................... 1811/2811/3811...................... Certificate of 150 150 150 160 160 160
correction.
1.20(b)........................... 1816/2816/3816...................... Processing fee for 150 150 150 160 160 160
correcting inventorship
in a patent.
1.20(c)(1)........................ 1831/2831/3831...................... Ex parte reexamination 6,000 3,000 1,500 6,300 3,150 1,575
(Sec. 1.510(a))
Streamlined.
1.20(c)(2)........................ 1812/2812/3812...................... Ex parte reexamination 12,000 6,000 3,000 12,600 6,300 3,150
(Sec. 1.510(a)) Non-
streamlined.
1.20(c)(7)........................ 1812/2812/3812...................... Refused request for ex 3,600 1,800 900 3,780 1,890 945
parte reexamination.
1.20(c)(3)........................ 1821/2821/3821...................... Each reexamination 460 230 115 480 240 120
independent claim in
excess of three and
also in excess of the
number of such claims
in the patent under
reexamination.
1.20(c)(6)........................ 1824/2824/3824...................... Petitions in a 1,940 970 485 2,040 1,020 510
reexamination
proceeding, except for
those specifically
enumerated in 37 CFR
1.550(i) and 1.937(d).
1.20(d)........................... 1814/2814/3814...................... Statutory disclaimer, 160 160 160 170 170 170
including terminal
disclaimer.
1.20(e)........................... 1551/2551/3551...................... For maintaining an 1,600 800 400 2,000 1,000 500
original or any reissue
patent, due at 3.5
years.
1.20(f)........................... 1552/2552/3552...................... For maintaining an 3,600 1,800 900 3,760 1,880 940
original or any reissue
patent, due at 7.5
years.
1.20(g)........................... 1553/2553/3553...................... For maintaining an 7,400 3,700 1,850 7,700 3,850 1,925
original or any reissue
patent, due at 11.5
years.
1.20(h)........................... 1554/2554/3554...................... Surcharge--3.5 year-- 160 80 40 500 250 125
Late payment within 6
months.
1.20(h)........................... 1555/2555/3555...................... Surcharge--7.5 year-- 160 80 40 500 250 125
Late payment within 6
months.
1.20(h)........................... 1556/2556/3556...................... Surcharge--11.5 year-- 160 80 40 500 250 125
Late payment within 6
months.
1.20(j)(1)........................ 1457/2457/3457...................... Extension of term of 1,120 1,120 1,120 1,180 1,180 1,180
patent.
1.20(j)(2)........................ 1458/2458/3458...................... Initial application for 420 420 420 440 440 440
interim extension (see
37 CFR 1.790).
1.20(j)(3)........................ 1459/2459/3459...................... Subsequent application 220 220 220 230 230 230
for interim extension
(see 37 CFR 1.790).
1.20(k)(1)........................ 1826/2826/3826...................... Request for supplemental 4,400 2,200 1,100 4,620 2,310 1,155
examination.
1.20(k)(2)........................ 1827/2827/3827...................... Reexamination ordered as 12,100 6,050 3,025 12,700 6,350 3,175
a result of
supplemental
examination.
1.20(k)(3)(ii).................... 1829/2829/3829...................... Supplemental Examination 280 140 70 300 150 75
Document Size Fee--for
each additional 50
sheets or a fraction
thereof in a nonpatent
document.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.21: Section 1.21 is amended by adding paragraph (a)(8)
and revising paragraphs (a)(1), (2), and (5), (9)(ii), (10); (k); (n);
(o); and (q) to set forth miscellaneous fees and charges as authorized
under section 10 of the Act. Section 1.21(a)(6)(i) is being revised to
remove and reserve the fee for the USPTO-assisted recovery of ID or
reset of password for the Office of Enrollment and Discipline
Information System. The changes to the fee amounts indicated in Sec.
1.21 are shown in Table 16.
The USPTO amends paragraph (o) of Sec. 1.21 to clarify the
applicability of its provisions. The USPTO specifies that the mega-
sequence listing fee applies to an application filed under 35 U.S.C.
111 or 371 to clarify that the fee applies to both provisional and
nonprovisional applications filed under 35 U.S.C. 111, as well as to
national stage applications under 35 U.S.C. 371. The fee does not apply
to international applications filed with the U.S. Receiving Office (RO/
US) that do not enter the U.S. national stage under 35 U.S.C. 371.
Furthermore, the rule clarifies that it is the receipt by the Office of
a mega-sequence listing in an application that is subject to the fee. A
sequence listing in a national stage application may be received by the
USPTO from the International Bureau in accordance with PCT Article 20
rather than directly submitted to the USPTO by the applicant. Thus, the
clarification makes clear that the mega-sequence listing fee applies to
such receipt. The USPTO further clarifies that the fee applies to only
the first receipt of a sequence listing in electronic form having a
size ranging from 300MB to 800MB and to the first receipt of a sequence
listing in electronic form having a size over 800MB. Thus, an applicant
will not be charged the mega-sequence listing fee for the submission of
a substitute or replacement electronic form of the sequence listing
(see 37 CFR 1.825) unless the size of the substitute or replacement
electronic form sequence listing is subject to the provisions of a
different paragraph of Sec. 1.21(o) (e.g., the first sequence listing
in an application is between 300MB and 800MB and a replacement sequence
listing is greater than 800MB). Finally, the USPTO specifies that for
purposes of determining the fee required under Sec. 1.21(o), the size
of the electronic form of the sequence listing is measured without file
compression.
Table 16--CFR Section 1.21 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description --------------------------------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.21(a)(1)(i).............. 9001......................... Application fee 100 100 100 110 110 110
(non-refundable).
1.21(a)(1)(ii)(A).......... 9010......................... For test 200 200 200 210 210 210
administration
by commercial
entity.
1.21(a)(1)(ii)(B).......... 9011......................... For test 450 450 450 470 470 470
administration
by the USPTO.
[[Page 46976]]
1.21(a)(1)(iii)............ 9029......................... For USPTO- 450 450 450 470 470 470
administered
review of
registration
examination.
1.21(a)(2)(i).............. 9003......................... On registration 200 200 200 210 210 210
to practice
under Sec.
11.6.
1.21(a)(2)(ii)............. 9026......................... On grant of 200 200 200 210 210 210
limited
recognition
under Sec.
11.9(b).
1.21(a)(2)(iii)............ 9025......................... On change of 100 100 100 110 110 110
registration
from agent to
attorney.
1.21(a)(5)(i).............. 9012......................... Review of 400 400 400 420 420 420
decision by the
Director of
Enrollment and
Discipline under
Sec. 11.2(c).
1.21(a)(5)(ii)............. 9013......................... Review of 400 400 400 420 420 420
decision of the
Director of
Enrollment and
Discipline under
Sec. 11.2(d).
1.21(a)(6)(i).............. 9027......................... For USPTO- 70 70 70 discontinued discontinued discontinued
assisted
recovery of ID
or reset of
password for the
Office of
Enrollment and
Discipline
Information
System.
1.21(a)(9)(ii)............. 9004......................... Administrative 200 200 200 210 210 210
reinstatement
fee.
1.21(a)(10)................ 9014......................... On petition for 1,600 1,600 1,600 1,680 1,680 1,680
reinstatement by
a person
excluded or
suspended on
ethical grounds,
or excluded on
consent from
practice before
the Office.
1.21(k).................... 9024......................... Unspecified other AT COST AT COST AT COST AT COST AT COST AT COST
services,
excluding labor.
1.21(n).................... 8026......................... Handling fee for 130 130 130 140 140 140
incomplete or
improper
application.
1.21(o)(1)................. 1091/2091/3091............... Submission of 1,000 500 250 1,060 530 265
sequence
listings of
300MB to 800MB.
1.21(o)(2)................. 1092/2092/3092............... Submission of 10,000 5,000 2,500 10,500 5,250 2,625
sequence
listings of more
than 800MB.
1.21(q).................... 8054......................... Additional fee 160 160 160 170 170 170
for expedited
service.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.27: Section 1.27 is amended by revising the introductory
text of paragraph (c)(3) to provide that the payment, by any party, of
the exact amount of the small entity transmittal fee set forth in Sec.
1.1031(a) will be treated as a written assertion of entitlement to
small entity status. The change to Sec. 1.27(c)(3) will make it easier
for applicants filing an international design application through the
USPTO as an office of indirect filing to establish small entity status.
Section 1.431: Section 1.431 is amended by revising paragraph (c)
to remove the reference to the late payment fee calculation under PCT
Rule 16bis.2. The late payment fee pursuant to PCT Rule 16bis.2 is
added to Sec. 1.445, as that provision concerns international
application filing, processing, and search fees.
Section 1.445: Section 1.445 is amended by revising paragraph (a)
to set forth international filing, processing, and search fees and
charges as authorized under section 10 of the Act. The changes to the
fee amounts indicated in 37 CFR 1.445 are shown in Table 17. Section
1.445(a) is also amended to include the late payment fee pursuant to
PCT Rule 16bis.2. See discussion of Sec. 1.431, supra.
Table 17--CFR Section 1.445 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description -----------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.445(a)(1) (i)(A)................ 1601/2601/3601...................... Transmittal fee......... 240 120 60 260 130 65
1.445(a)(2) (i)................... 1602/2602/3602...................... Search fee--regardless 2,080 1,040 520 2,180 1,090 545
of whether there is a
corresponding
application (see 35
U.S.C. 361(d) and PCT
Rule 16).
1.445(a)(3) (i)................... 1604/2604/3604...................... Supplemental search fee 2,080 1,040 520 2,180 1,090 545
when required, per
additional invention.
1.445(a)(4)....................... 1621/2621/3621...................... Transmitting application 240 120 60 260 130 65
to Intl. Bureau to act
as receiving office.
1.445(a)(5)....................... 1627/2627/3627...................... Late furnishing fee for 300 150 75 320 160 80
providing a sequence
listing in response to
an invitation under PCT
rule 13ter.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.482: Section 1.482 is amended by revising paragraphs (a)
through (c) to read as set out in the regulatory text at the end of
this document. The changes to the fee
[[Page 46977]]
amounts indicated in Sec. 1.482 are shown in Table 18.
Table 18--CFR Section 1.482 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description -----------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.482(a)(1)(i).................... 1605/2605/3605...................... Preliminary examination 600 300 150 640 320 160
fee--U.S. was the ISA.
1.482(a)(1)(ii)................... 1606/2606/3606...................... Preliminary examination 760 380 190 800 400 200
fee--U.S. was not the
ISA.
1.482(a)(2)....................... 1607/2607/3607...................... Supplemental examination 600 300 150 640 320 160
fee per additional
invention.
1.482(c).......................... 1627/2627/3627...................... Late furnishing fee for 300 150 75 320 160 80
providing a sequence
listing in response to
an invitation under PCT
rule 13ter.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 1.492: Section 1.492 is amended by revising paragraphs (a),
(b)(3) and (4), (c)(2), (d), (f), (h), and (j) to set forth the
application filing, excess claims, search, and examination fees for
international patent applications entering the national stage as
authorized under section 10 of the Act. The changes to the fee amounts
indicated in Sec. 1.492 are shown in Table 19. In this section, table
headers were added to make formatting consistent.
Table 19--CFR Section 1.492 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description -----------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.492(a).......................... 1631/2631/3631...................... Basic National Stage Fee 300 150 75 320 160 80
1.492(b)(3)....................... 1642/2642/3642...................... National Stage Search 520 260 130 540 270 135
Fee--search report
prepared and provided
to USPTO.
1.492(b)(4)....................... 1632/2632/3632...................... National Stage Search 660 330 165 700 350 175
Fee--all other
situations.
1.492(c)(2)....................... 1633/2633/3633...................... National Stage 760 380 190 800 400 200
Examination Fee--all
other situations.
1.492(d).......................... 1614/2614/3614...................... Each independent claim 460 230 115 480 240 120
in excess of three.
1.492(f).......................... 1616/2616/3616...................... Multiple dependent claim 820 410 205 860 430 215
1.492(h).......................... 1617/2617/3617...................... Search fee, examination 140 70 35 160 80 40
fee or oath or
declaration after the
date of commencement of
the national stage.
1.492(j).......................... 1681/2681/3681...................... National Stage 400 200 100 420 210 105
Application Size Fee--
for each additional 50
sheets that exceeds 100
sheets.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 11.11: The USPTO amends paragraph (a)(1) to provide that
the OED director may publish a practitioner's CLE certification status.
Paragraph (a)(1) has also been amended to require that persons granted
limited recognition pursuant to Sec. 11.9 provide the contact
information listed in Sec. 11.11(a)(1).
The USPTO amends paragraph (a)(2) to provide that registered
practitioners and persons granted limited recognition under Sec.
11.9(b) are required to biennially file a registration statement. It
further provides that failure to file the mandatory registration
statement may result in administrative suspension as set forth in Sec.
11.11(b).
The USPTO adds paragraph (a)(3) to Sec. 11.11 to provide that
registered practitioners and persons granted limited recognition under
Sec. 11.9(b) may certify to the OED director that they have completed
six credits of CLE in the preceding 24 months, with five of the credits
in patent law and practice and one of the credits in ethics.
The USPTO amends paragraph (b)(1) in Sec. 11.11 to apply to those
failing to comply with Sec. 11.11(a)(2), which refers to the
registration statement.
The USPTO amends paragraph (e) in Sec. 11.11 to provide that
resigned practitioners are subject to investigation for their conduct
that occurred prior to, during, or after the period of their
resignation.
The USPTO amends paragraph (f)(1) in Sec. 11.11 to remove any
references to resigned practitioners, remove the requirement that a
practitioner who was administratively suspended for two or more years
before the date the Office receives a completed application from the
person must also pass the registration examination under Sec.
11.7(b)(1)(ii), and add the requirement that any practitioner who
remains administratively suspended for more than five years shall be
required to file a petition to the OED director requesting
reinstatement and providing objective evidence that the practitioner
continues to possess the necessary legal qualifications to render
valuable service to patent applicants.
The USPTO adds paragraph (f)(3) to Sec. 11.11, which sets forth
the process by which a practitioner who has resigned may apply to be
reinstated to the register in active status.
Section 41.20: Section 41.20 is amended by revising paragraphs (a),
(b)(1), (b)(2)(ii), and (b)(3) and (4) to set forth the appeal fees as
authorized under section 10 of the Act. The changes to the fee amounts
indicated in Sec. 41.20 are shown in Table 20.
Table 20--CFR Section 41.20 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description -----------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
41.20(a).......................... 1405/2405/3405...................... Petitions to the Chief 400 400 400 420 420 420
Administrative Patent
Judge under 37 CFR 41.3.
[[Page 46978]]
41.20(b)(1)....................... 1401/2401/3401...................... Notice of appeal........ 800 400 200 840 420 210
41.20(b)(2)(ii)................... 1404/2404/3404...................... Filing a brief in 2,000 1,000 500 2,100 1,050 525
support of an appeal in
an inter partes
reexamination
proceeding.
41.20(b)(3)....................... 1403/2403/3403...................... Request for oral hearing 1,300 650 325 1,360 680 340
41.20(b)(4)....................... 1413/2413/3413...................... Forwarding an appeal in 2,240 1,120 560 2,360 1,180 590
an application or ex
parte reexamination
proceeding to the Board.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Section 42.15: Section 42.15 is amended by revising paragraphs (a)
through (e) to set forth the inter partes review and post-grant review
or covered business method patent review fees as authorized under
section 10 of the Act. The changes to the fee amounts indicated in
Sec. 42.15 are shown in Table 21.
Table 21--CFR Section 42.15 Fee Changes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current fees (dollars) Final rule fees (dollars)
CFR section Fee code Description -----------------------------------------------------
Large Small Micro Large Small Micro
--------------------------------------------------------------------------------------------------------------------------------------------------------
42.15(a)(1)....................... 1406................................ Inter partes review 15,500 15,500 15,500 19,000 19,000 19,000
request fee--Up to 20
Claims.
42.15(a)(2)....................... 1414................................ Inter partes review post- 15,000 15,000 15,000 n/a n/a n/a
institution fee--Up to
15 Claims.
42.15(a)(2)....................... 1414................................ Inter partes review post- n/a n/a n/a 22,500 22,500 22,500
institution fee--Up to
20 Claims.
42.15(a)(3)....................... 1407................................ Inter partes review 300 300 300 375 375 375
request of each claim
in excess of 20.
42.15(a)(4)....................... 1415................................ Inter partes post- 600 600 600 750 750 750
institution request of
each claim in excess of
20.
42.15(b)(1)....................... 1408................................ Post-grant or covered 16,000 16,000 16,000 20,000 20,000 20,000
business method patent
review request fee--Up
to 20 Claims.
42.15(b)(2)....................... 1416................................ Post-grant or covered 22,000 22,000 22,000 n/a n/a n/a
business method patent
review post-institution
fee--Up to 15 Claims.
42.15(b)(2)....................... 1416................................ Post-grant or covered n/a n/a n/a 27,500 27,500 27,500
business method patent
review post-institution
fee--Up to 20 Claims.
42.15(b)(3)....................... 1409................................ Post-grant or covered 375 375 375 475 475 475
business method review
request of each claim
in excess of 20.
42.15(b)(4)....................... 1417................................ Post-grant or covered 825 825 825 1,050 1,050 1,050
business method review
post-institution
request of each claim
in excess of 20.
42.15(c)(1)....................... 1412................................ Petition for a 400 400 400 420 420 420
derivation proceeding.
42.15(d).......................... 1411................................ Request to make a 400 400 400 420 420 420
settlement agreement
available and other
requests filed in a
patent trial proceeding.
42.15(e).......................... NEW................................. Pro hac vice admission n/a n/a n/a 250 250 250
fee.
--------------------------------------------------------------------------------------------------------------------------------------------------------
VIII. Rulemaking Considerations
A. AIA: America Invents Act
This Final Rule sets and adjusts fees under section 10(a) of the
AIA as amended by the SUCCESS Act, Public Law 115-273, 132 Stat. 4158.
Section 10(a) of the AIA authorizes the director of the USPTO to set or
adjust by rule any patent fee established, authorized, or charged under
title 35 of the U.S.C. for any services performed, or materials
furnished, by the Office. The SUCCESS Act extends the USPTO fee setting
authority until September 2026. Section 10 of the AIA prescribes that
fees may be set or adjusted only to recover the aggregate estimated
cost to the Office for processing, activities, services, and materials
relating to patents, including administrative costs of the Office with
respect to such patent fees. Section 10 authority includes flexibility
to set individual fees in a way that furthers key policy factors, while
taking into account the cost of the respective services. Section 10(e)
of the AIA sets forth the general requirements for rulemakings that set
or adjust fees under this authority. In particular, section 10(e)(1)
requires the director to publish in the Federal Register any proposed
fee change under section 10 and include in such publication the
specific rationale and purpose for the proposal, including the possible
expectations or benefits resulting from the proposed change. For such
rulemakings, the AIA requires that the Office provide a public comment
period of no less than 45 days.
The PPAC advises the Under Secretary of Commerce for Intellectual
Property and Director of the USPTO on the management, policies, goals,
performance, budget, and user fees of patent operations. When proposing
fees under section 10 of the Act, the director must provide the PPAC
with the proposed fees at least 45 days prior to publishing them in the
Federal Register. The PPAC then has at least 30 days within which to
deliberate, consider, and comment on the proposal, as well as hold
public hearing(s) on the proposed fees. The PPAC must make a written
report available to the public of the comments, advice, and
recommendations of the committee regarding the proposed fees before the
Office issues any final fees. The Office considers and analyzes any
comments, advice, or recommendations received from the PPAC before
finally setting or adjusting fees.
Consistent with this framework, on August 8, 2018, the director
notified the PPAC of the Office's intent to set or adjust patent fees
and submitted a preliminary patent fee proposal with supporting
materials. The preliminary patent fee proposal and associated materials
are available at https://www.uspto.gov/FeeSettingAndAdjusting. The PPAC
held a public hearing in Alexandria, Virginia, on
[[Page 46979]]
September 6, 2018. Transcripts of the hearing are available for review
at https://www.uspto.gov/sites/default/files/documents/PPAC_Hearing_Transcript_20180906.pdf. Members of the public were
invited to the hearing and given the opportunity to submit written and/
or oral testimony for the PPAC to consider. The PPAC considered such
public comments from the hearing and made all comments available to the
public via the Fee Setting website, https://www.uspto.gov/FeeSettingAndAdjusting. The PPAC also provided a written report setting
forth in detail the comments, advice, and recommendations of the
committee regarding the preliminary proposed fees. The report regarding
the preliminary proposed fees was released on October 29, 2018, and can
be found online at https://www.uspto.gov/sites/default/files/documents/PPAC_Fee_Setting_Report_Oct2018_1.pdf. The Office considered and
analyzed all comments, advice, and recommendations received from the
PPAC before publishing the NPRM on July 31, 2019 (84 FR 37398). The
NPRM comment period closed on September 30, 2019. Section 10(e) of the
Act requires the director to publish the final fee rule in the Federal
Register and the Official Gazette of the USPTO at least 45 days before
the final fees become effective. Pursuant to this requirement, this
rule is effective on [INSERT DATE 60 DAYS AFTER DATE OF PUBLICATION IN
THE Federal Register], except for the amendment to Sec. 1.16(u), which
is effective on January 1, 2022.
B. Regulatory Flexibility Act
The USPTO publishes this Final Regulatory Flexibility Analysis
(FRFA) as required by the Regulatory Flexibility Act (RFA) (5 U.S.C.
601, et seq.) to examine the impact of the Office's rule to implement
the fee setting provisions of the Leahy-Smith America Invents Act (Pub.
L. 112-29, 125 Stat. 284) (AIA or the Act) on small entities. Under the
RFA, whenever an agency is required by 5 U.S.C. 553 (or any other law)
to publish an NPRM, the agency must prepare and make available for
public comment an Initial Regulatory Flexibility Analysis (IRFA),
unless the agency certifies under 5 U.S.C. 605(b) that the rule, if
implemented, will not have a significant impact on a substantial number
of small entities (5 U.S.C. 603, 605). The Office published an IRFA,
along with the NPRM, on July 31, 2019 (84 FR 37398). Given that the
final patent fee schedule, based on the assumptions found in the FY
2021 Budget, is projected to result in $1.2 billion in additional
aggregate revenue over the current fee schedule (baseline) for the
period including FY 2020 to FY 2024, the Office acknowledges that the
fee adjustments will impact all entities seeking patent protection. The
$1,205.1 million in additional aggregate revenue results from an
additional $267.9 million in FY 2020, $39.1 million in FY 2021, $293.7
million in FY 2022, $297.8 million in FY 2023, and $306.7 million in FY
2024.
Items 1-6 below discuss the five items specified in 5 U.S.C.
604(a)(1)-(6) to be addressed in an FRFA. Item 6 below discusses
alternatives to this proposal that the Office considered.
1. A Statement of the Need for, and Objectives of, the Rule
Section 10 of the AIA, as amended by the SUCCESS Act, authorizes
the director of the USPTO to set or adjust by rule any patent fee
established, authorized, or charged under title 35, U.S.C., for any
services performed, or materials furnished, by the Office. The
objective of the final patent fee schedule is for patent fees to
recover the aggregate cost of patent operations, including
administrative costs, while facilitating effective administration of
the U.S. patent system. Since its inception, the Act strengthened the
patent system by affording the USPTO the ``resources it requires to
clear the still sizeable backlog of patent applications and move
forward to deliver to all American inventors the first rate service
they deserve.'' H.R. Rep. No. 112-98(I), at 163 (2011). In setting and
adjusting fees under the Act, the Office will secure a sufficient
amount of aggregate revenue to recover the aggregate cost of patent
operations, including revenue needed to achieve strategic and
operational goals. Additional information on the Office's strategic
goals may be found in the Strategic Plan, available at www.uspto.gov/strategicplan. Additional information on the Office's operating
requirements to achieve the strategic goals may be found in the ``USPTO
FY 2021 President's Budget Request,'' available at https://www.uspto.gov/about-us/performance-and-planning/budget-and-financial-information.
2. A Statement of the Significant Issues Raised by the Public Comments
in Response to the Initial Regulatory Flexibility Analysis, a Statement
of the Assessment of the Agency of Such Issues, and a Statement of Any
Changes Made in the Final Rule as a Result of Such Comments
The Office received two public comments in response to the IRFA.
Details of those comments are discussed and analyzed above in Part VI:
Discussion of Comments and are summarized here.
Comment: One commenter wrote that the increase in the second and
subsequent RCE fee would hurt small entity applicants and small entity
law firms. The Initial Regulatory Flexibility Analysis offered no
explanation justifying that differential effect on small entities.
Response: The USPTO is not targeting the RCE fees for a specific
increase. Instead, the fees for RCEs--both for the first request and
for second and subsequent requests--are being adjusted by the across-
the-board adjustment to patent fees. The USPTO would like to note that
small and micro entity applicants will continue to receive the small
and micro entity discounts, which set the fee rates significantly below
cost to examine second and subsequent RCE filings. Additionally, the
Regulatory Flexibility Analysis analyzed applicants' sensitivity to
changes in fee rates by entity size, including RCE fees for small
entities. This impact is also included in the RIA completed for this
rulemaking, which is available at https://www.uspto.gov/FeeSettingAndAdjusting.
Comment: One commenter claimed the Regulatory Flexibility Analysis
must analyze the effect of the annual active patent practitioner fee on
small entities because a great number of practitioners work for small
entities.
Response: As noted in response to Comment 81 above, the USPTO has
elected not to implement the annual active patent practitioner fee at
this time.
3. The Response of the Agency to Any Comments Filed by the Chief
Counsel for Advocacy of the Small Business Administration in Response
to the Proposed Rule, and a Detailed Statement of Any Change Made to
the Proposed Rule in the Final Rule as a Result of the Comments
The Office did not receive any comments filed by the Chief Counsel
for Advocacy of the Small Business Administration in response to the
proposed rule.
4. A Description of and, Where Feasible, an Estimate of the Number of
Small Entities To Which the Rule Will Apply or an Explanation of Why No
Such Estimate Is Available
(a) SBA Size Standard
The Small Business Act (SBA) size standards applicable to most
analyses conducted to comply with the RFA are set forth in 13 CFR
121.201. These
[[Page 46980]]
regulations generally define small businesses as those with less than a
specified 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. As provided by the RFA,
and after consulting with the Small Business Administration, the Office
formally adopted an alternate size standard for the purpose of
conducting an analysis or making a certification under the RFA 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, 67109 (Nov. 20,
2006), 1313 Off. Gaz. Pat. Office 37, 60 (Dec. 12, 2006). The Office's
alternate small business size standard consists of the SBA's previously
established size standard for entities entitled to pay reduced patent
fees. See 13 CFR 121.802.
Unlike the SBA's generally applicable small business size
standards, the size standard for the USPTO is not industry-specific.
The Office's definition of a small business concern for RFA 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)
that 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 that would not qualify as a nonprofit organization or a small
business concern under this definition. See 71 FR at 67109, 1313 Off.
Gaz. Pat. Office 60.
If a patent applicant self-identifies on a patent application as
qualifying as a small entity or provides certification of micro entity
status for reduced patent fees under the Office's alternative size
standard, 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.
Small Entity Defined
The Act provides that fees set or adjusted under section 10(a)
``for filing, searching, examining, issuing, appealing, and maintaining
patent applications and patents shall be reduced by 50 percent'' with
respect to the application of such fees to any ``small entity'' (as
defined in 37 CFR 1.27) that qualifies for reduced fees under 35 U.S.C.
41(h)(1). In turn, 125 Stat. at 316-17. 35 U.S.C. 41(h)(1) provides
that certain patent fees ``shall be reduced by 50 percent'' for a small
business concern as defined by section 3 of the SBA, and to any
independent inventor or nonprofit organization as defined in
regulations described by the director.
Micro Entity Defined
Section 10(g) of the Act created a new category of entity called a
``micro entity.'' 35 U.S.C. 123; see also 125 Stat. at 318-19. Section
10(b) of the Act provides that the fees set or adjusted under section
10(a) ``for filing, searching, examining, issuing, appealing, and
maintaining patent applications and patents shall be reduced by 75
percent with respect to the application of such fees to any micro
entity as defined by 35 U.S. Code 123.'' 125 Stat. at 315-17. 35 U.S.C.
123(a) defines a ``micro entity'' as an applicant that makes a
certification that the applicant: (1) Qualifies as a small entity as
defined in 37 CFR 1.27; (2) has not been named as an inventor on more
than four previously filed patent applications, other than applications
filed in another country, provisional applications under 35 U.S.C.
111(b), or PCT applications for which the basic national fee under 35
U.S.C. 41(a) was not paid; (3) did not, in the calendar year preceding
the calendar year in which the applicable fee is being paid, have a
gross income, as defined in section 61(a) of the Internal Revenue Code
of 1986 (26 U.S.C. 61(a)), exceeding three times the median household
income for that preceding calendar year, as most recently reported by
the Bureau of the Census; \2\ and (4) has not assigned, granted, or
conveyed, and is not under an obligation by contract or law to assign,
grant, or convey, a license or other ownership interest in the
application concerned to an entity exceeding the income limit set forth
in (3) above. See 125 Stat. at 318. 35 U.S.C. 123(d) also defines a
``micro entity'' as an applicant that certifies that: (1) The
applicant's employer, from which the applicant obtains the majority of
the applicant's income, is an institution of higher education as
defined in section 101(a) of the Higher Education Act of 1965 (20
U.S.C. 1001(a)); or (2) the applicant has assigned, granted, conveyed,
or is under an obligation by contract or law to assign, grant, or
convey, a license or other ownership interest in the particular
applications to such an institution of higher education.
---------------------------------------------------------------------------
\2\ For more information, see https://www.uspto.gov/PatentMicroentity.
---------------------------------------------------------------------------
Estimate of Number of Small Entities Affected
The changes in this Final Rule will apply to any entity, including
small and micro entities, that pays any patent fee set forth in this
Final Rule. The reduced fee rates (50 percent for small entities and 75
percent for micro entities) will continue to apply to any small entity
asserting small entity status and to any micro entity certifying micro
entity status for filing, searching, examining, issuing, appealing, and
maintaining patent applications and patents.
The Office reviews historical data to estimate the percentages of
application filings asserting small entity status. Table 22 presents a
summary of such small entity filings by type of application (utility,
reissue, plant, design) over the last five years.
Table 22--Number of Patent Applications Filed In Last Five Years *
----------------------------------------------------------------------------------------------------------------
FY 2019 ** FY 2018 FY 2017 FY 2016 FY 2015 Average
----------------------------------------------------------------------------------------------------------------
Utility:
All........................... 619,186 597,952 604,655 609,063 579,358 602,043
Small......................... 140,097 135,307 134,393 131,617 125,991 133,481
% Small....................... 22.6 22.6 22.2 21.6 21.7 22.2
Micro......................... 19,844 20,314 20,359 20,652 19,119 20,058
% Micro....................... 3.2 3.4 3.4 3.4 3.3 3.3
Reissue:
All........................... 1,131 1,023 1,086 1,123 1,154 1,103
[[Page 46981]]
Small......................... 241 219 237 237 217 230
% Small....................... 21.3 21.4 21.8 21.1 18.8 20.9
Micro......................... 33 20 23 21 12 22
% Micro....................... 2.9 2.0 2.1 1.9 1.0 2.0
Plant:
All........................... 1,168 1,043 1,076 1,181 1,095 1,113
Small......................... 594 467 536 563 577 547
% Small....................... 50.9 44.8 49.8 47.7 52.7 49.2
Micro......................... 7 7 18 10 6 10
% Micro....................... 0.6 0.7 1.7 0.8 0.5 0.9
Design:
All........................... 45,945 46,433 44,048 42,298 38,183 43,381
Small......................... 18,628 18,992 18,014 16,723 14,709 17,413
% Small....................... 40.5 40.9 40.9 39.5 38.5 40.1
Micro......................... 6,464 5,459 4,983 4,289 3,879 5,015
% Micro....................... 14.1 11.8 11.3 10.1 10.2 11.6
----------------------------------------------------------------------------------------------------------------
* The patent application filing data in this table includes RCEs.
** FY 2019 application filing data are preliminary and will be finalized in the FY 2020 Performance and
Accountability Report (PAR).
Because the percentage of small entity filings varies widely
between application types, the Office has averaged the small entity
filing rates over the past five years for those application types in
order to estimate future filing rates by small and micro entities.
Those average rates appear in the last column of Table 22.
The USPTO continuously updates both patent fee collections
projections and workload projections based on the latest data. The
estimated number of patent applications has been updated since the NPRM
was published in July 2019. UPR filings growth projections were revised
upward during the FY 2021 budget formulation process due to revised
RGDP estimates and historical trends. As found in the FY 2021 Budget,
the Office estimates that serialized UPR patent application growth
rates will be 2.5 percent in FY 2020, 2.0 percent in FY 2021, 1.5
percent in FY 2022, and 1.0 percent in FYs 2023 and 2024. The Office
forecasts design patent applications independently of UPR applications
because they exhibit different behavior.
Using the estimated filings for the next five years and the average
historic rates of small entity filings, Table 23 presents the Office's
estimates of the number of patent application filings by all
applicants, including small and micro entities, over the next five
fiscal years by application type.
Table 23--Estimated Numbers of Patent Applications in FY 2020-FY 2024
----------------------------------------------------------------------------------------------------------------
FY 2020 FY 2021 FY 2022 FY 2023 FY 2024
----------------------------------------------------------------------------------------------------------------
Utility........................................ 632,402 632,105 642,729 652,922 662,489
Reissue........................................ 899 899 899 899 899
Plant.......................................... 1,300 1,300 1,300 1,300 1,300
Design......................................... 45,751 47,581 49,484 51,464 53,521
----------------------------------------------------------------
Total...................................... 680,352 681,885 694,412 706,585 718,209
----------------------------------------------------------------------------------------------------------------
The Office has undertaken an elasticity analysis to examine if fee
adjustments may impact small entities and, in particular, whether
increases in fees would result in some such entities not submitting
applications. Elasticity measures how sensitive demand for services by
patent applicants and patentees is to fee changes. If elasticity is low
enough (demand is inelastic), then fee increases will not reduce
patenting activity enough to negatively impact overall revenues. If
elasticity is high enough (demand is elastic), then increasing fees
will decrease patenting activity enough to decrease revenue. The Office
analyzed elasticity at the overall filing level across all patent
applicants with regard to entity size and estimated the potential
impact to patent application filings across entities. Additional
information about elasticity estimates is available at https://www.uspto.gov/FeeSettingAndAdjusting in the document entitled ``Setting
and Adjusting Patent Fees during Fiscal Year 2020--Description of
Elasticity Estimates.''
5. A Description of the Projected Reporting, Recordkeeping, and Other
Compliance Requirements of the Rule, Including an Estimate of the
Classes of Small Entities Which Will be Subject to the Requirement and
Type of Professional Skills Necessary for Preparation of the Report or
Record
When implemented, this rule will not change the burden of existing
reporting and recordkeeping requirements for payment of fees. The
current requirements for small and micro entities will continue to
apply. Therefore, the professional skills necessary to file and
prosecute an application through issue and maintenance remain unchanged
under this rule. This action only adjusts patent fees and does not set
procedures for asserting small entity status or certifying micro entity
status, as previously discussed. There are no new compliance
requirements in this rule.
The full fee schedule (see Part VII: Discussion of Specific Rules)
is set forth in this Final Rule. The fee schedule sets or adjusts 296
patent fees in total. This includes four fees that will be discontinued
and five new fees.
[[Page 46982]]
6. A Description of the Steps the Agency Has Taken To Minimize the
Significant Economic Impact on Small Entities Consistent With the
Stated Objectives of Applicable Statutes, Including a Statement of the
Factual, Policy, and Legal Reasons for Selecting the Alternative
Adopted in the Final Rule and Why Each One of the Other Significant
Alternatives to the Rule Considered by the Agency Which Affect the
Impact on Small Entities Was Rejected
The USPTO considered several alternative approaches to this Final
Rule, discussed below, including full cost recovery for individual
services, an across-the-board adjustment to fees, and a baseline
(current fee rates). The discussion begins with Alternative 1, a
description of the fee schedule adopted in this Final Rule. A full
discussion of the costs and benefits of all four alternatives and the
methodology used for that analysis is contained in the RIA, available
at https://www.uspto.gov/FeeSettingAndAdjusting.
(a) Alternative 1: Final Patent Fee Schedule--Setting and Adjusting
Patent Fees During Fiscal Year 2020
The USPTO chose the patent fee schedule in this Final Rule because
it achieves the aggregate revenue needed for the Office to offset
aggregate costs, based on the assumptions found in the FY 2021 Budget,
and is therefore beneficial to all entities that seek patent
protection. Also, the alternative selected here benefits from
improvements in the design of the fee schedule. The final patent fee
schedule herein secures the Office's required revenue to recover its
aggregate costs, while progressing towards high-quality and timely
patent examination and review proceedings in order to produce reliable
and predictable IP rights. This will benefit all applicants, including
small and micro entities, without undue burden to patent applicants and
holders, barriers to entry, or reduced incentives to innovate. This
alternative maintains small and micro entity discounts. Compared to the
current fee schedule, there are no new small or micro entity fee codes
being extended to existing large entity fee rates, and none are being
eliminated. All entities will benefit from the Office's proposal to
discontinue four fees. Three patent service fees are being eliminated
in order to focus USPTO workforce efforts on producing products that
benefit the general public rather than producing outputs for individual
customers that can be obtained through other, more efficient means.
Additionally, the Office is eliminating the fee for assisting with the
recovery of identification or reset of a password for the Office of
Enrollment and Discipline Information System. This fee is being removed
because it is unnecessary.
As discussed throughout this document, the fee changes in this
alternative are moderate compared to other alternatives. Given that the
final patent fee schedule will result in increased aggregate revenue,
small and micro entities will pay some higher fees when compared to the
current fee schedule (Alternative 4).
In summary, the fees to obtain a patent will increase. All patent
fees not covered by the targeted adjustments as discussed in section B
of Part V, or to be discontinued, as discussed in section C of Part V,
are subject to the approximately 5 percent across the board increase.
In addition to the across the board increase, some fees will be subject
to a larger increase. For example, the issue fee and first stage
maintenance fee rate will increase by 20 and 25 percent, respectively.
However, second and third stage maintenance fees will only increase by
4 percent, less than the across-the-board increase. This alternative
includes a new surcharge fee for applications not filed in DOCX format,
which aims to improve the electronic application process for patent
applicants by modernizing the USPTO's filing and viewing systems. This
streamlines the application and publication processes, which benefits
both the applicants and examiners. In an effort to enable the PTAB to
continue high-quality, timely, and efficient proceedings with the
expected increase in work following the Supreme Court decision in SAS
Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018), AIA trial fees will
increase by at least 23.0 percent. Finally, in response to feedback
from members of the public, the fee for a request for the expedited
examination of a design application has been reduced to $1,600. Under
the NPRM, the fee was proposed to be $2,000.
Adjusting the patent fee schedule as prescribed in this alternative
allows the Office to implement the patent-related strategic goals and
objectives documented in the Strategic Plan and to carry out
requirements as described in the FY 2021 Budget. Specifically, this
final patent fee schedule is estimated to generate sufficient revenue
to support increases in core examination costs that are necessary to
implement strategic initiatives to issue highly reliable patents, such
as increasing the time examiners are provided to work on each
application. This final patent fee schedule also supports the Strategic
Plan's mission support goal to deliver organizational excellence (which
includes optimizing the speed, quality, and cost-effectiveness of IT
delivery to achieve business value and ensuring financial
sustainability to facilitate effective USPTO operations) by allowing
the Office to continue to make necessary business improvements. While
all of the other alternatives discussed facilitate progress toward some
of the Office's goals, the final patent fee schedule is the only one
that does so in a way that does not impose undue costs on patent
applicants and holders.
A comparison between the final patent fee schedule for this rule
and existing fees (labeled Alternative 1--Final Patent Fee Schedule--
Setting and Adjusting Patent Fees during Fiscal Year 2020) is available
at https://www.uspto.gov/FeeSettingAndAdjusting in the document
entitled ``Final Regulatory Flexibility Analysis Tables.'' Fee changes
for small and micro entities are included in the tables. For the
comparison between the fees in the final patent fee schedule and
current fees, as noted above, the ``current fees'' column displays the
fees that were in effect as of January 2018.
(b) Other Alternatives Considered
In addition to the final patent fee schedule set forth in
Alternative 1, above, the Office considered several other alternative
approaches. For each alternative considered, the Office calculated fee
rates and the resulting revenue derived by each alternative scenario.
The fees and their corresponding revenue tables are available at
https://www.uspto.gov/FeeSettingAndAdjusting. Please note, only the
fees outlined in Alternative 1 are being implemented in the Final Rule;
other scenarios are discussed only to present the Office's analysis of
other options.
Alternative 2: Unit Cost Recovery
It is common practice in the federal government to set individual
fees at a level sufficient to recover the cost of that single service.
In fact, official guidance on user fees, as cited in OMB Circular A-25:
User Charges, states that user charges (fees) should be sufficient to
recover the full cost to the federal government of providing the
particular service, resource, or good when the government is acting in
its capacity as sovereign.
As such, the USPTO considered setting most individual large entity
fees at the historical cost of performing the activities related to the
particular service in FY 2018. (While more recent FY 2019 cost data is
now available, for
[[Page 46983]]
consistency with information presented in the NPRM, the Office
continues to base the fee rates displayed under Alternative 2 in the
IRFA and the RIA on FY 2018 unit cost data). There are several
complexities in achieving individual fee unit cost recovery for the
patent fee schedule. The most significant is the AIA requirement to
provide a 50 percent discount on fees to small entities and a 75
percent discount on fees to micro entities. To account for this
requirement, this alternative continues existing small and micro entity
discounts where eligible under AIA authority. Thus, in order to
continue the small and micro entity discounts and generate sufficient
revenue to recover the Office's anticipated budgetary requirements over
the five-year period with the assumptions found in the FY 2021 Budget,
for this alternative, maintenance fees must be set significantly above
unit cost.
With the exception of maintenance fees, fees for which there is no
FY 2018 cost data would be set at current rates under this alternative.
The Office no longer collects activity-based information for
maintenance fees, and previous year unit costs were negligible. For the
small number of services that have a variable fee, the aggregate
revenue table does not list a fee. Instead, for those services with an
estimated workload, the workload is listed in dollars rather than units
to develop revenue estimates. Fees without either a fixed fee rate or a
workload estimate are assumed to provide zero revenue to the Office.
Note, this alternative bases fee rates for FY 2020 through FY 2024 on
FY 2018 historical costs. The Office recognizes that this approach does
not account for inflationary factors that would likely increase costs
and necessitate higher fees in the out-years.
Alternative 2 could present significant barriers to those seeking
patent protection because front-end fees would increase significantly
for all applicants, even with small and micro entity fee reductions.
Further, this alternative is counter to the Office's general philosophy
to charge applicants and holders lower fees when they have less
information about the relative value of their innovation. This
alternative does not align well with the strategic and policy goals of
this Final Rule. Both the current and final patent fee schedule are
structured to collect more fees further along in the process (i.e.,
issue fees and maintenance fees), when the patent owner has better
information about a patent's value, rather than up front (i.e., filing
fees, search fees, and examination fees), when applicants are less
certain about the value of their innovation, even though the front-end
services are costlier to the Office. This alternative presents
significant barriers to those seeking patent protection because if the
Office were to immediately shift from the current front-end/back-end
balance to a unit cost recovery structure, front-end fees would
increase significantly, nearly tripling in some cases (e.g., search
fees).
The Office has estimated the potential quantitative elasticity
impacts for application filings (e.g., filing, search, and examination
fees), maintenance renewals (all stages), and other major fee
categories. Results of this analysis indicate that a high cost of entry
into the patent system could lead to a significant decrease in the
incentives to invest in innovative activities among all entities,
especially for small and micro entities. Under the current fee
schedule, maintenance fees subsidize all applications, including those
applications for which no claims are allowed. By insisting on unit cost
payment at each point in the application process, the Office is
effectively charging high fees for every attempted patent, meaning
those applicants who have less information about the patentability of
their claims or the market value of their invention may be less likely
to pursue initial prosecution (e.g., filing, search, and examination)
or subsequent actions to continue prosecution (e.g., RCE). The ultimate
effect of these changes in behavior is likely to stifle innovation. In
sum, this alternative is inadequate to accomplish the goals and
strategies as stated in Part III of this Final Rule.
The Office theorizes that the high costs of entry into the patent
system could lead to a decrease in the incentives to invest in
innovative activities among all entities, and especially small and
micro entities. There is a strong possibility that funds previously
used for issue and maintenance fee payments could offset the higher
front-end costs for some users, but the front-end costs could prove
insurmountable for other innovators.
The fee schedule for Alternative 2: Unit Cost Recovery is available
at https://www.uspto.gov/FeeSettingAndAdjusting in the document
entitled ``Final Regulatory Flexibility Analysis Tables.'' For the
comparison between unit cost recovery fees and current fees, the
``current fees'' column displays the fees that are in effect as of
January 2018. This column is used to calculate dollar and percent fee
change compared to unit cost recovery fees.
Alternative 3: Across-the Board-Adjustment
In years past, the USPTO used its authority to adjust statutory
fees annually according to increases in the consumer price index (CPI),
which is a commonly used measure of inflation. Building on this prior
approach and incorporating the additional authority under the AIA to
set small and micro entity fees, Alternative 3 would set fees by
applying a one-time 10 percent, across the board inflationary increase
to the baseline (current fees) beginning in July 2020. Ten percent
represents the change in revenue needed to achieve the aggregate
revenue needed to cover future budgetary requirements based on the
assumptions found in the FY 2021 Budget. All entities (large, small,
and micro) would pay 10 percent higher fees for every product and
service.
As estimated by the CBO in 2019, projected CPI rates by fiscal year
are: 2.3 percent in FY 2020, 2.5 percent in FY 2021 through FY 2023,
and 2.4 percent in FY 2024. The Office elected not to apply the
estimated cumulative inflationary adjustment (12.8 percent), from FY
2020 through FY 2024 because doing so would result in significantly
greater fee revenue than needed to meet the Office's core mission and
strategic priorities. Under this alternative, nearly every existing fee
would be increased, and no fees would be discontinued or reduced. But
this alternative maintains the status quo ratio of front-end and back-
end fees, given that all fees would be adjusted by the same escalation
factor, thereby promoting innovation strategies and allowing applicants
to gain access to the patent system through fees set below cost while
patent holders pay issue and maintenance fees above cost to subsidize
the below cost front-end fees. Alternative 3 nevertheless fails to
implement policy factors and deliver benefits beyond what exists in the
baseline fee schedule (e.g., no fee adjustments to offer new patent
prosecution options or facilitate more effective administration of the
patent system). Given that all entities (large, small, and micro) would
pay 10.0 percent higher fees for every product and service, especially
the fees due at the time of filing, this alternative does not
adequately support the Office's policy factor to promote innovation
strategies.
The fee schedule for Alternative 3: Across-the-Board Adjustment is
available at https://www.uspto.gov/FeeSettingAndAdjusting in the
document entitled ``Final Regulatory Flexibility Analysis Tables.'' For
the comparison between the across-the-
[[Page 46984]]
board adjustment fees and current fees, the ``current fees'' column
displays the fees that are in effect as of January 2018.
Alternative 4: Baseline (Current Fee Schedule)
The Office considered a no-action alternative. This alternative
would retain the status quo, meaning that the Office would continue the
small and micro entity discounts that Congress provided in section 10
of the Act and maintain fees as of January 2018.
This approach would not provide sufficient aggregate revenue, based
on the assumptions found in the FY 2021 Budget, to accomplish the
Office's rulemaking goals as set forth in Part III of this Final Rule
or the Strategic Plan. IT improvement, progress on backlog and
pendency, and other improvement activities would continue, but at a
significantly slower rate, as increases in core patent examination
costs that are necessary to implement the strategic objective to issue
highly reliable patents--such as increasing the time examiners are
provided to work on each application--crowd out funding for other
improvements. Likewise, without a fee increase, the USPTO would deplete
its operating reserves, leaving the Office vulnerable to fiscal and
economic events. This would expose core operations to unacceptable
levels of financial risk and would position the Office to have to
return to making inefficient, short-term funding decisions.
The fee schedule for Alternative 4: Baseline (Current Fee Schedule)
is available at https://www.uspto.gov/FeeSettingAndAdjusting in the
document entitled ``Final Regulatory Flexibility Analysis Tables.''
Alternatives Specified by the RFA
The RFA provides that an agency should also consider four specified
``alternatives'' or approaches, namely: (1) Establishing different
compliance or reporting requirements or timetables that take into
account the resources available to small entities; (2) clarifying,
consolidating, or simplifying compliance and reporting requirements
under the rule for small entities; (3) using performance rather than
design standards; and (4) exempting small entities from coverage of the
rule, or any part thereof (5 U.S.C. 604(c)). The USPTO discusses each
of these specified alternatives or approaches below and describes how
this Final Rule is adopting these approaches.
Differing Requirements
As discussed above, the changes in this Final Rule would continue
existing fee discounts for small and micro entities that take into
account the reduced resources available to them as well as offer new
discounts when applicable under AIA authority. Specifically, micro
entities would continue to receive a 75 percent reduction in patent
fees under this proposal and non-micro, small entities would continue
to pay 50 percent of the fee.
This Final Rule sets fee levels but does not set or alter
procedural requirements for asserting small or micro entity status. To
pay reduced patent fees, small entities must merely assert small entity
status to pay reduced patent fees. The small entity may make this
assertion by either checking a box on the transmittal form, ``Applicant
claims small entity status,'' or by paying the basic filing or basic
national small entity fee exactly. The process to claim micro entity
status is similar in that eligible entities need only submit a written
certification of their status prior to or at the time a reduced fee is
paid. This Final Rule does not change any reporting requirements for
any small or micro entity. For both small and micro entities, the
burden to establish their status is nominal (making an assertion or
submitting a certification), and the benefit of the fee reductions (50
percent for small entities and 75 percent for micro entities) is
significant.
This Final Rule makes the best use of differing requirements for
small and micro entities. It also makes the best use of the redesigned
fee structure, as discussed further below.
Clarification, Consolidation, or Simplification of Requirements
This Final Rule pertains to setting or adjusting patent fees. Any
compliance or reporting requirements in this rule are de minimis and
necessary to implement lower fees. Therefore, any clarifications,
consolidations, or simplifications to compliance and reporting
requirements for small entities are not applicable or would not achieve
the objectives of this rulemaking.
Performance Standards
Performance standards do not apply to the Final Rule.
Exemption for Small and Micro Entities
The final patent fee schedule maintains a 50 percent reduction in
fees for small entities and a 75 percent reduction in fees for micro
entities. The Office considered exempting small and micro entities from
paying increased patent fees but determined that the USPTO would lack
statutory authority for this approach. Section 10(b) of the Act
provides that ``fees set or adjusted under subsection (a) for filing,
searching, examining, issuing, appealing, and maintaining patent
applications and patents shall be reduced by 50 percent [for small
entities] and shall be reduced by 75 percent [for micro entities]''
(emphasis added). Neither the AIA nor any other statute authorizes the
USPTO simply to exempt small or micro entities, as a class of
applicants, from paying increased patent fees.
C. Executive Order 12866 (Regulatory Planning and Review)
This Final Rule has been determined to be economically significant
for purposes of Executive Order 12866 (Sept. 30, 1993). The Office has
developed an RIA as required for rulemakings deemed to be economically
significant. The complete RIA is available at https://www.uspto.gov/FeeSettingAndAdjusting.
D. Executive Order 13563 (Improving Regulation and Regulatory Review)
The Office has complied with Executive Order 13563 (Jan. 18, 2011).
Specifically, the Office has, to the extent feasible and applicable:
(1) Made a reasoned determination that the benefits justify the costs
of this Final Rule; (2) tailored this Final Rule to impose the least
burden on society consistent with obtaining the regulatory objectives;
(3) selected a regulatory approach that maximizes net benefits; (4)
specified performance objectives; (5) identified and assessed available
alternatives; (6) involved the public in an open exchange of
information and perspectives among experts in relevant disciplines,
affected stakeholders in the private sector, and the public as a whole,
and provided online access to the rulemaking docket; (7) attempted to
promote coordination, simplification, and harmonization across
government agencies and identified goals designed to promote
innovation; (8) considered approaches that reduce burdens and maintain
flexibility and freedom of choice for the public; and (9) ensured the
objectivity of scientific and technological information and processes.
E. Executive Order 13771 (Reducing Regulation and Controlling
Regulatory Costs)
This Final Rule is not subject to the requirements of Executive
Order 13771 (Jan. 30, 2017) because this Final Rule involves a transfer
payment.
[[Page 46985]]
F. Executive Order 13132 (Federalism)
This rulemaking does not contain policies with federalism
implications sufficient to warrant preparation of a Federalism
Assessment under Executive Order 13132 (Aug. 4, 1999).
G. Executive Order 13175 (Tribal Consultation)
This rulemaking will not: (1) Have substantial direct effects on
one or more Indian tribes, (2) impose substantial direct compliance
costs on Indian tribal governments, or (3) preempt tribal law.
Therefore, a tribal summary impact statement is not required under
Executive Order 13175 (Nov. 6, 2000).
H. Executive Order 13211 (Energy Effects)
This rulemaking is not a significant energy action under Executive
Order 13211 (May 18, 2001) because this final rulemaking is not likely
to have a significant adverse effect on the supply, distribution, or
use of energy. Therefore, a Statement of Energy Effects is not required
under Executive Order 13211.
I. Executive Order 12988 (Civil Justice Reform)
This rulemaking meets applicable standards to minimize litigation,
eliminate ambiguity, and reduce burden as set forth in sections 3(a)
and 3(b)(2) of Executive Order 12988 (Feb. 5, 1996).
J. Executive Order 13045 (Protection of Children)
This rulemaking does not concern an environmental risk to health or
safety that may disproportionately affect children under Executive
Order 13045 (Apr. 21, 1997).
K. Executive Order 12630 (Taking of Private Property)
This rulemaking will not affect a taking of private property or
otherwise have taking implications under Executive Order 12630 (Mar.
15, 1988).
L. Congressional Review Act
Under the Congressional Review Act provisions of the Small Business
Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.),
prior to issuing any final rule, the United States Patent and Trademark
Office will submit a report containing the rule and other required
information to the United States Senate, the United States House of
Representatives, and the Comptroller General of the Government
Accountability Office. The changes in this Final Rule are expected to
result in an annual effect on the economy of $100 million or more, a
major increase in costs or prices, or significant adverse effects on
competition, employment, investment, productivity, innovation, or the
ability of United States-based enterprises to compete with foreign-
based enterprises in domestic and export markets. Therefore, this Final
Rule is a ``major rule'' as defined in 5 U.S.C. 804(2).
M. Unfunded Mandates Reform Act of 1995
The changes set forth in this rulemaking do not involve a federal
intergovernmental mandate that will result in the expenditure by state,
local, and tribal governments, in the aggregate, of $100 million (as
adjusted) or more in any one year, or a federal private sector mandate
that will result in the expenditure by the private sector of $100
million (as adjusted) or more in any one year, and will not
significantly or uniquely affect small governments. Therefore, no
actions are necessary under the provisions of the Unfunded Mandates
Reform Act of 1995. See 2 U.S.C. 1501 et seq.
N. National Environmental Policy Act
This rulemaking will not have any effect on the quality of the
environment and is thus categorically excluded from review under the
National Environmental Policy Act of 1969. See 42 U.S.C. 4321 et seq.
O. National Technology Transfer and Advancement Act
The requirements of section 12(d) of the National Technology
Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) are not
applicable because this rulemaking does not contain provisions that
involve the use of technical standards.
P. Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.)
requires that the Office consider the impact of paperwork and other
information collection burdens imposed on the public. This Final Rule
involves information collection requirements that are subject to review
by the OMB under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3549). The collection of information involved in this Final Rule have
been reviewed and previously approved by the OMB under control numbers
0651-0012, 0651-0016, 0651-0020, 0651-0021, 0651-0031, 0651-0032, 0651-
0033, 0651-0059, 0651-0063, 0651-0064, 0651-0069, and 0651-0075. In
addition, updates to the aforementioned information collections as a
result of this Final Rule have been submitted to the OMB as non-
substantive change requests.
Notwithstanding any other provision of law, no person is required
to respond to, nor shall any person be subject to a penalty for failure
to comply with, a collection of information subject to the requirements
of the Paperwork Reduction Act unless that collection of information
has a currently valid OMB control number.
List of Subjects
37 CFR Part 1
Administrative practice and procedure, Biologics, Courts, Freedom
of information, Inventions and patents, Reporting and recordkeeping
requirements, Small businesses.
37 CFR Part 11
Administrative practice and procedure, Inventions and patents,
Lawyers, Reporting and recordkeeping requirements.
37 CFR Part 41
Administrative practice and procedure, Inventions and patents,
Lawyers, Reporting and recordkeeping requirements.
37 CFR Part 42
Administrative practice and procedure, Inventions and patents,
Lawyers.
For the reasons set forth in the preamble, 37 CFR parts 1, 11, 41,
and 42 are amended as follows:
PART 1--RULES OF PRACTICE IN PATENT CASES
0
1. The authority citation for 37 CFR part 1 continues to read as
follows:
Authority: 35 U.S.C. 2(b)(2), unless otherwise noted.
0
2. Section 1.16 is amended by:
0
a. Revising paragraphs (a) through (e);
0
b. Adding table headings to the tables in paragraphs (f) and (g);
0
c. Revising paragraph (h);
0
d. Adding a heading to the table in paragraph (i);
0
e. Revising paragraphs (j) and (k);
0
f. Adding a heading to the table in paragraph (l);
0
g. Revising paragraphs (m) through (s);
0
h. Adding a heading to the table in paragraph (t); and
0
i. Adding paragraph (u).
The revisions and additions read as follows:
Sec. 1.16 National application filing, search, and examination fees.
(a) Basic fee for filing each application under 35 U.S.C. 111 for
an original patent, except design, plant, or provisional applications:
[[Page 46986]]
Table 1 to Paragraph (a)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $80.00
By a small entity (Sec. 1.27(a))......................... 160.00
By a small entity (Sec. 1.27(a)) if the application is 80.00
submitted in compliance with the Office electronic filing
system (Sec. 1.27(b)(2))................................
By other than a small or micro entity...................... 320.00
------------------------------------------------------------------------
(b) Basic fee for filing each application under 35 U.S.C. 111 for
an original design patent:
Table 2 to Paragraph (b)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $55.00
By a small entity (Sec. 1.27(a))......................... 110.00
By other than a small or micro entity...................... 220.00
------------------------------------------------------------------------
(c) Basic fee for filing each application for an original plant
patent:
Table 3 to Paragraph (c)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $55.00
By a small entity (Sec. 1.27(a))......................... 110.00
By other than a small or micro entity...................... 220.00
------------------------------------------------------------------------
(d) Basic fee for filing each provisional application:
Table 4 to Paragraph (d)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $75.00
By a small entity (Sec. 1.27(a))......................... 150.00
By other than a small or micro entity...................... 300.00
------------------------------------------------------------------------
(e) Basic fee for filing each application for the reissue of a
patent:
Table 5 to Paragraph (e)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $80.00
By a small entity (Sec. 1.27(a))......................... 160.00
By other than a small or micro entity...................... 320.00
------------------------------------------------------------------------
(f) * * *
Table 6 to Paragraph (f)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(g) * * *
Table 7 to Paragraph (g)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(h) In addition to the basic filing fee in an application, other
than a provisional application, for filing or later presentation at any
other time of each claim in independent form in excess of three:
Table 8 to Paragraph (h)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $120.00
By a small entity (Sec. 1.27(a))......................... 240.00
By other than a small or micro entity...................... 480.00
------------------------------------------------------------------------
(i) * * *
Table 9 to Paragraph (i)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(j) In addition to the basic filing fee in an application, other
than a provisional application, that contains, or is amended to
contain, a multiple dependent claim, per application:
Table 10 to Paragraph (j)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $215.00
By a small entity (Sec. 1.27(a))......................... 430.00
By other than a small or micro entity...................... 860.00
------------------------------------------------------------------------
(k) Search fee for each application filed under 35 U.S.C. 111 for
an original patent, except design, plant, or provisional applications:
Table 11 to Paragraph (k)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $175.00
By a small entity (Sec. 1.27(a))......................... 350.00
By other than a small or micro entity...................... 700.00
------------------------------------------------------------------------
(l) * * *
Table 12 to Paragraph (l)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(m) Search fee for each application for an original plant patent:
Table 13 to Paragraph (m)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $110.00
By a small entity (Sec. 1.27(a))......................... 220.00
By other than a small or micro entity...................... 440.00
------------------------------------------------------------------------
(n) Search fee for each application for the reissue of a patent:
Table 14 to Paragraph (n)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $175.00
By a small entity (Sec. 1.27(a))......................... 350.00
By other than a small or micro entity...................... 700.00
------------------------------------------------------------------------
(o) Examination fee for each application filed under 35 U.S.C. 111
for an original patent, except design, plant, or provisional
applications:
Table 15 to Paragraph (o)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $200.00
By a small entity (Sec. 1.27(a))......................... 400.00
By other than a small or micro entity...................... 800.00
------------------------------------------------------------------------
(p) Examination fee for each application under 35 U.S.C. 111 for an
original design patent:
Table 16 to Paragraph (p)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $160.00
By a small entity (Sec. 1.27(a))......................... 320.00
By other than a small or micro entity...................... 640.00
------------------------------------------------------------------------
(q) Examination fee for each application for an original plant
patent:
Table 17 to Paragraph (q)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $165.00
By a small entity (Sec. 1.27(a))......................... 330.00
By other than a small or micro entit....................... 660.00
------------------------------------------------------------------------
(r) Examination fee for each application for the reissue of a
patent:
Table 18 to Paragraph (r)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $580.00
By a small entity (Sec. 1.27(a))......................... 1,160.00
By other than a small or micro entity...................... 2,320.00
------------------------------------------------------------------------
(s) Application size fee for any application filed under 35
U.S.C.111 for the specification and drawings which exceed 100 sheets of
paper, for each additional 50 sheets or fraction thereof:
Table 19 to Paragraph (s)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $105.00
By a small entity (Sec. 1.27(a))......................... 210.00
By other than a small or micro entity...................... 420.00
------------------------------------------------------------------------
(t) * * *
Table 20 to Paragraph (t)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(u) Additional fee for any application filed on or after January 1,
2022 under 35 U.S.C.111 for an original patent, except design, plant,
or provisional applications, where the specification, claims, and/or
abstract does not conform to the USPTO requirements for submission in
DOCX format:
Table 21 to Paragraph (u)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $100.00
By a small entity (Sec. 1.27(a))......................... 200.00
By a small entity (Sec. 1.27(a)) if the application is 200.00
submitted in compliance with the Office electronic filing
system (Sec. 1.27(b)(2))................................
By other than a small or micro entity...................... 400.00
------------------------------------------------------------------------
0
3. Section 1.17 is amended by:
0
a. Revising paragraph (a) and (c) through (g);
0
c. Revising paragraph (h) introductory text and adding heading to the
table in paragraph (h);
0
d. Revising paragraph (i)(1) introductory text and adding a heading to
the table in paragraph (i)(1);
0
e. Revising paragraphs (i)(2) and (k);
0
f. Revising paragraph (m);
0
g. Adding a heading to the table in paragraph (o);
[[Page 46987]]
0
h. Revising paragraphs (p) through (s); and
0
i. Adding a heading to the table in paragraph (t).
The revisions and additions read as follows:
Sec. 1.17 Patent application and reexamination processing fees.
(a) Extension fees pursuant to Sec. 1.136(a):
(1) For reply within first month:
Table 1 to Paragraph (a)(1)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $55.00
By a small entity (Sec. 1.27(a))......................... 110.00
By other than a small or micro entity...................... 220.00
------------------------------------------------------------------------
(2) For reply within second month:
Table 2 to Paragraph (a)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $160.00
By a small entity (Sec. 1.27(a))......................... 320.0
By other than a small or micro entity...................... 640.00
------------------------------------------------------------------------
(3) For reply within third month:
Table 3 to Paragraph (a)(3)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $370.00
By a small entity (Sec. 1.27(a))......................... 740.00
By other than a small or micro entity...................... 1,480.00
------------------------------------------------------------------------
(4) For reply within fourth month:
Table 4 to Paragraph (a)(4)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $580.00
By a small entity (Sec. 1.27(a))......................... 1,160.00
By other than a small or micro entity...................... $2,320.00
------------------------------------------------------------------------
(5) For reply within fifth month:
Table 5 to Paragraph (a)(5)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $790.00
By a small entity (Sec. 1.27(a))......................... 1,580.00
By other than a small or micro entity...................... 3,160.00
------------------------------------------------------------------------
* * * * *
(c) For filing a request for prioritized examination under Sec.
1.102(e):
Table 6 to Paragraph (c)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $1,050.00
By a small entity (Sec. 1.27(a))......................... 2,100.00
By other than a small or micro entity...................... 4,200.00
------------------------------------------------------------------------
(d) For correction of inventorship in an application after the
first action on the merits:
Table 7 to Paragraph (d)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $160.00
By a small entity (Sec. 1.27(a))......................... 320.00
By other than a small or micro entity...................... 640.00
------------------------------------------------------------------------
(e) To request continued examination pursuant to Sec. 1.114:
(1) For filing a first request for continued examination pursuant
to Sec. 1.114 in an application:
Table 8 to Paragraph (e)(1)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $340.00
By a small entity (Sec. 1.27(a))......................... 680.00
By other than a small or micro entity...................... 1,360.00
------------------------------------------------------------------------
(2) For filing a second or subsequent request for continued
examination pursuant to Sec. 1.114 in an application:
Table 9 to Paragraph (e)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $500.00
By a small entity (Sec. 1.27(a))......................... 1,000.00
By other than a small or micro entity...................... 2,000.00
------------------------------------------------------------------------
(f) For filing a petition under one of the sections in paragraphs
(f)(1) through (6) of this section that refers to this paragraph (f):
Table 10 to Paragraph (f)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $105.00
By a small entity (Sec. 1.27(a))......................... 210.00
By other than a small or micro entity...................... 420.00
------------------------------------------------------------------------
Sec. 1.36(a)--for revocation of a power of attorney by fewer than all
of the applicants
Sec. 1.53(e)--to accord a filing date
Sec. 1.182--for a decision on a question not specifically provided for
in an application for a patent
Sec. 1.183--to suspend the rules in an application for a patent
Sec. 1.741(b)--to accord a filing date to an application under Sec.
1.740 for an extension of a patent term
Sec. 1.1023--to review the filing date of an international design
application
(g) For filing a petition under one of the following sections that
refers to this paragraph (g):
Table 11 to Paragraph (g)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $55.00
By a small entity (Sec. 1.27(a))......................... 110.00
By other than a small or micro entity...................... 220.00
------------------------------------------------------------------------
Sec. 1.12--for access to an assignment record
Sec. 1.14--for access to an application
Sec. 1.46--for filing an application on behalf of an inventor by a
person who otherwise shows sufficient proprietary interest in the
matter
Sec. 1.55(f)--for filing a belated certified copy of a foreign
application
Sec. 1.55(g)--for filing a belated certified copy of a foreign
application
Sec. 1.57(a)--for filing a belated certified copy of a foreign
application
Sec. 1.59--for expungement of information
Sec. 1.103(a)--to suspend action in an application
Sec. 1.136(b)--for review of a request for an extension of time when
the provisions of Sec. 1.136(a) are not available
Sec. 1.377--for review of a decision refusing to accept and record
payment of a maintenance fee filed prior to the expiration of a patent
Sec. 1.550(c)--for patent owner requests for an extension of time in
ex parte reexamination proceedings
Sec. 1.956--for patent owner requests for an extension of time in
inter partes reexamination proceedings
Sec. 5.12 of this chapter--for expedited handling of a foreign filing
license
Sec. 5.15 of this chapter--for changing the scope of a license
Sec. 5.25 of this chapter--for a retroactive license
(h) For filing a petition under one of the following sections that
refers to this paragraph (h):
Table 12 to Paragraph (h)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(i) * * *
(1) For taking action under one of the following sections that
refers to this paragraph (i)(1):
Table 13 to Paragraph (i)(1)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(2) For taking action under one of the sections in paragraphs
(i)(2)(i) and (ii) of this section that refers to this paragraph
(i)(2):
Table 14 to Paragraph (i)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $140.00
By a small entity (Sec. 1.27(a))......................... 140.00
By other than a small or micro entity...................... 140.00
------------------------------------------------------------------------
Sec. 1.217--for processing a redacted copy of a paper submitted in the
file of an application in which a redacted copy was submitted for the
patent application publication
Sec. 1.221--for requesting voluntary publication or republication of
an application
* * * * *
(k) For filing a request for expedited examination under Sec.
1.155(a):
Table 15 to Paragraph (k)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $400.00
By a small entity (Sec. 1.27(a))......................... 800.00
By other than a small or micro entity...................... 1,600.00
------------------------------------------------------------------------
* * * * *
(m) For filing a petition for the revival of an abandoned
application for a
[[Page 46988]]
patent, for the delayed payment of the fee for issuing each patent, for
the delayed response by the patent owner in any reexamination
proceeding, for the delayed payment of the fee for maintaining a patent
in force, for the delayed submission of a priority or benefit claim,
for the extension of the 12-month (six-month for designs) period for
filing a subsequent application (Sec. Sec. 1.55(c) and (e); 1.78(b),
(c), and (e); 1.137; 1.378; and 1.452), or for filing a petition to
excuse an applicant's failure to act within prescribed time limits in
an international design application (Sec. 1.1051):
Table 16 to Paragraph (m)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $525.00
By a small entity (Sec. 1.27(a))......................... 1,050.00
By other than a small or micro entity...................... 2,100.00
------------------------------------------------------------------------
* * * * *
(o) * * *
Table 17 to Paragraph (o)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(p) For an information disclosure statement under Sec. 1.97(c) or
(d):
Table 18 to Paragraph (p)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $65.00
By a small entity (Sec. 1.27(a))......................... 130.00
By other than a small or micro entity...................... 260.00
------------------------------------------------------------------------
(q) Processing fee for taking action under one of the sections in
paragraphs (q)(1) through (3) of this section that refers to this
paragraph (q): $50.00
Sec. 1.41--to supply the name or names of the inventor or inventors
after the filing date without a cover sheet as prescribed by Sec.
1.51(c)(1) in a provisional application
Sec. 1.48--for correction of inventorship in a provisional application
Sec. 1.53(c)(2)--to convert a nonprovisional application filed under
Sec. 1.53(b) to a provisional application under Sec. 1.53(c)
(r) For entry of a submission after final rejection under Sec.
1.129(a):
Table 19 to Paragraph (r)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $220.00
By a small entity (Sec. 1.27(a))......................... 440.00
By other than a small or micro entity...................... 880.00
------------------------------------------------------------------------
(s) For each additional invention requested to be examined under
Sec. 1.129(b):
Table 20 to Paragraph (s)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $220.00
By a small entity (Sec. 1.27(a))......................... 440.00
By other than a small or micro entity...................... 880.00
------------------------------------------------------------------------
(t) * * *
Table 21 to Paragraph (t)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
0
4. Section 1.18 is amended by revising paragraphs (a), (b)(1), (c),
(d)(3), (e), and (f) to read as follows:
Sec. 1.18 Patent post allowance (including issue) fees.
(a) Issue fee for issuing each original patent, except a design or
plant patent, or for issuing each reissue patent:
Table 1 to Paragraph (a)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $300.00
By a small entity (Sec. 1.27(a))......................... 600.00
By other than a small or micro entity...................... 1,200.00
------------------------------------------------------------------------
(b)(1) Issue fee for issuing an original design patent:
Table 2 to Paragraph (b)(1)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $185.00
By a small entity (Sec. 1.27(a))......................... 370.00
By other than a small or micro entity...................... 740.00
------------------------------------------------------------------------
* * * * *
(c) Issue fee for issuing an original plant patent:
Table 3 to Paragraph (c)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $210.00
By a small entity (Sec. 1.27(a))......................... 420.00
By other than a small or micro entity...................... 840.00
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
(d) * * *
(3) Republication fee (Sec. 1.221(a)).................... $320.00
(e) For filing an application for patent term adjustment 210.00
under Sec. 1.705........................................
(f) For filing a request for reinstatement of all or part 420.00
of the term reduced pursuant to Sec. 1.704(b) in an
application for a patent term adjustment under Sec.
1.705.....................................................
------------------------------------------------------------------------
0
5. Section 1.19 is amended by revising paragraphs (b)(1)(i)(B) and
(b)(1)(ii)(B) and removing paragraphs (j) through (l).
The revisions read as follows:
Sec. 1.19 Document supply fees.
* * * * *
(b) * * *
(1) * * *
(i) * * *
(B) Copy Patent File Wrapper, Any Number of Sheets: $290.00
* * * * *
(ii) * * *
(B) Copy Patent File Wrapper, Electronic, Any Size: $60.00
* * * * *
0
6. Section 1.20 is revised to read as follows:
Sec. 1.20 Post-issuance fees.
(a) For providing a certificate of correction for an applicant's
mistake (Sec. 1.323): $160.00
(b) Processing fee for correcting inventorship in a patent (Sec.
1.324): $160.00
(c) In reexamination proceedings:
(1)(i) For filing a request for ex parte reexamination (Sec.
1.510(a)) having:
(A) 40 or fewer pages
(B) Lines that are double-spaced or one-and-a-half spaced
(C) Text written in a non-script type font such as Arial, Times New
Roman, or Courier
(D) A font size no smaller than 12 point
(E) Margins that conform to the requirements of Sec.
1.52(a)(1)(ii)
(F) Sufficient clarity and contrast to permit direct reproduction
and electronic capture by use of digital imaging and optical character
recognition
Table 1 to Paragraph (c)(1)(i)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $1,575.00
By a small entity (Sec. 1.27(a))......................... 3,150.00
By other than a small or micro entity...................... 6,300.00
------------------------------------------------------------------------
(ii) The following parts of an ex parte reexamination request are
excluded from paragraphs (c)(1)(i)(A) through (F) of this section:
(A) The copies of every patent or printed publication relied upon
in the request pursuant to Sec. 1.510(b)(3)
(B) The copy of the entire patent for which reexamination is
requested pursuant to Sec. 1.510(b)(4)
(C) The certifications required pursuant to Sec. 1.510(b)(5) and
(6)
(2) For filing a request for ex parte reexamination (Sec.
1.510(b)) that has sufficient clarity and contrast to permit direct
reproduction and electronic capture by use of digital imaging and
optical character recognition, and which otherwise does not comply with
the provisions of paragraph (c)(1) of this section:
Table 2 to Paragraph (c)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $3,150.00
By a small entity (Sec. 1.27(a))......................... 6,300.00
By other than a small or micro entity...................... 12,600.00
------------------------------------------------------------------------
(3) For filing with a request for reexamination or later
presentation at any other time of each claim in independent form in
excess of three and
[[Page 46989]]
also in excess of the number of claims in independent form in the
patent under reexamination:
Table 3 to Paragraph (c)(3)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $120.00
By a small entity (Sec. 1.27(a))......................... 240.00
By other than a small or micro entity...................... 480.00
------------------------------------------------------------------------
(4) For filing with a request for reexamination or later
presentation at any other time of each claim (whether dependent or
independent) in excess of 20 and also in excess of the number of claims
in the patent under reexamination (note that Sec. 1.75(c) indicates
how multiple dependent claims are considered for fee calculation
purposes):
Table 4 to Paragraph (c)(4)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $25.00
By a small entity (Sec. 1.27(a))......................... 50.00
By other than a small or micro entity...................... 100.00
------------------------------------------------------------------------
(5) If the excess claims fees required by paragraphs (c)(3) and (4)
of this section are not paid with the request for reexamination or on
later presentation of the claims for which the excess claims fees are
due, the fees required by paragraphs (c)(3) and (4) must be paid or the
claims canceled by amendment prior to the expiration of the time period
set for reply by the Office in any notice of fee deficiency in order to
avoid abandonment.
(6) For filing a petition in a reexamination proceeding, except for
those specifically enumerated in Sec. Sec. 1.550(i) and 1.937(d):
Table 5 to Paragraph (c)(6)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $510.00
By a small entity (Sec. 1.27(a))......................... 1,020.00
By other than a small or micro entity...................... 2,040.00
------------------------------------------------------------------------
(7) For a refused request for ex parte reexamination under Sec.
1.510 (included in the request for ex parte reexamination fee at Sec.
1.20(c)(1) or (2)):
Table 6 to Paragraph (c)(7)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $1,890.00
By a small entity (Sec. 1.27(a))......................... 945.00
By other than a small or micro entity...................... 3,780.00
------------------------------------------------------------------------
(d) For filing each statutory disclaimer (Sec. 1.321): $170.00
(e) For maintaining an original or any reissue patent, except a
design or plant patent, based on an application filed on or after
December 12, 1980, in force beyond four years, the fee being due by
three years and six months after the original grant:
Table 7 to Paragraph (e)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $500.00
By a small entity (Sec. 1.27(a))......................... 1,000.00
By other than a small or micro entity...................... 2,000.00
------------------------------------------------------------------------
(f) For maintaining an original or any reissue patent, except a
design or plant patent, based on an application filed on or after
December 12, 1980, in force beyond eight years, the fee being due by
seven years and six months after the original grant:
Table 8 to Paragraph (f)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $940.00
By a small entity (Sec. 1.27(a))......................... 1,880.00
By other than a small or micro entity...................... 3,760.00
------------------------------------------------------------------------
(g) For maintaining an original or any reissue patent, except a
design or plant patent, based on an application filed on or after
December 12, 1980, in force beyond twelve years, the fee being due by
eleven years and six months after the original grant:
Table 9 to Paragraph (g)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $1,925.00
By a small entity (Sec. 1.27(a))......................... 3,850.00
By other than a small or micro entity...................... 7,700.00
------------------------------------------------------------------------
(h) Surcharge for paying a maintenance fee during the six-month
grace period following the expiration of three years and six months,
seven years and six months, and eleven years and six months after the
date of the original grant of a patent based on an application filed on
or after December 12, 1980:
Table 10 to Paragraph (h)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $125.00
By a small entity (Sec. 1.27(a))......................... 250.00
By other than a small or micro entity...................... 500.00
------------------------------------------------------------------------
(i) [Reserved]
(j) For filing an application for extension of the term of a
patent:
Table 11 to Paragraph (j)
------------------------------------------------------------------------
------------------------------------------------------------------------
(1) Application for extension under Sec. 1.740........... $1,180.00
(2) Initial application for interim extension under Sec. 440.00
1.790.....................................................
(3) Subsequent application for interim extension under Sec. 230.00
1.790...................................................
------------------------------------------------------------------------
(k) In supplemental examination proceedings:
(1) For processing and treating a request for supplemental
examination:
Table 12 to Paragraph (k)(1)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $1,155.00
By a small entity (Sec. 1.27(a))......................... 2,310.00
By other than a small or micro entity...................... 4,620.00
------------------------------------------------------------------------
(2) For ex parte reexamination ordered as a result of a
supplemental examination proceeding:
Table 13 to Paragraph (k)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $3,175.00
By a small entity (Sec. 1.27(a))......................... 6,350.00
By other than a small or micro entity...................... 12,700.00
------------------------------------------------------------------------
(3) For processing and treating, in a supplemental examination
proceeding, a non-patent document over 20 sheets in length, per
document:
(i) Between 21 and 50 sheets:
Table 14 to Paragraph (k)(3)(i)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $45.00
By a small entity (Sec. 1.27(a))......................... 90.00
By other than a small or micro entity...................... 180.00
------------------------------------------------------------------------
(ii) For each additional 50 sheets or a fraction thereof:
Table 15 to Paragraph (k)(3)(ii)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $75.00
By a small entity (Sec. 1.27(a))......................... 150.00
By other than a small or micro entity...................... 300.00
------------------------------------------------------------------------
0
7. Section 1.21 is amended by:
0
a. Revising paragraphs (a)(1), (2), and (5);
0
b. Removing and reserving paragraph (a)(6)(i);
0
c. Adding paragraph (a)(8);
0
d. Revising paragraphs (a)(9)(ii) and (a)(10);
0
e. Adding paragraph (k); and
0
f. Revising paragraphs (n), (o), and (q).
The revisions and addition read as follows:
Sec. 1.21 Miscellaneous fees and charges.
* * * * *
(a) * * *
(1) For admission to examination for registration to practice:
(i) Application fee (non-refundable): $110.00
(ii) Registration examination fee
(A) For test administration by commercial entity: $210.00
(B) For test administration by the USPTO: $470.00
(iii) For USPTO-administered review of registration examination:
$470.00
(2) On registration to practice or grant of limited recognition:
(i) On registration to practice under Sec. 11.6 of this chapter:
$210.00
(ii) On grant of limited recognition under Sec. 11.9(b) of this
chapter: $210.00
(iii) On change of registration from agent to attorney: $110.00
* * * * *
(5) For review of decision:
(i) By the Director of Enrollment and Discipline under Sec.
11.2(c) of this chapter: $420.00
[[Page 46990]]
(ii) Of the Director of Enrollment and Discipline under Sec.
11.2(d) of this chapter: $420.00
* * * * *
(9) * * *
(ii) Administrative reinstatement fee: $210.00
(10) On application by a person for recognition or registration
after disbarment or suspension on ethical grounds, or resignation
pending disciplinary proceedings in any other jurisdiction; on
application by a person for recognition or registration who is
asserting rehabilitation from prior conduct that resulted in an adverse
decision in the Office regarding the person's moral character; on
application by a person for recognition or registration after being
convicted of a felony or crime involving moral turpitude or breach of
fiduciary duty; and on petition for reinstatement by a person excluded
or suspended on ethical grounds, or excluded on consent from practice
before the Office: $1,680.00
* * * * *
(k) For items and services that the director finds may be supplied,
for which fees are not specified by statute or by this part, such
charges as may be determined by the director with respect to each such
item or service: Actual cost
* * * * *
(n) For handling an application in which proceedings are terminated
pursuant to Sec. 1.53(e): $140.00
(o) The receipt of a very lengthy sequence listing (mega-sequence
listing) in an application under 35 U.S.C. 111 or 371 is subject to the
following fee:
(1) First receipt by the Office of a sequence listing in electronic
form ranging in size from 300MB to 800MB (without file compression):
Table 1 to Paragraph (o)(1)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $265.00
By a small entity (Sec. 1.27(a))......................... 530.00
By other than a small or micro entity...................... 1,060.00
------------------------------------------------------------------------
(2) First receipt by the Office of a sequence listing in electronic
form exceeding 800MB in size (without file compression):
Table 2 to Paragraph (o)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $2,625.00
By a small entity (Sec. 1.27(a))......................... 5,250.00
By other than a small or micro entity...................... 10,500.00
------------------------------------------------------------------------
* * * * *
(q) Additional fee for expedited service: $170.00.
0
8. Section 1.27 is amended by revising paragraph (c)(3) introductory
text as follows:
Sec. 1.27 Definition of small entities and establishing status as a
small entity to permit payment of small entity fees; when a
determination of entitlement to small entity status and notification of
loss of entitlement to small entity status are required; fraud on the
Office.
* * * * *
(c) * * *
(3) Assertion by payment of the small entity basic filing, basic
transmittal, basic national fee, international search fee, or
individual designation fee in an international design application. The
payment, by any party, of the exact amount of one of the small entity
basic filing fees set forth in Sec. 1.16(a), (b), (c), (d), or (e),
the small entity transmittal fee set forth in Sec. 1.445(a)(1) or
Sec. 1.1031(a), the small entity international search fee set forth in
Sec. 1.445(a)(2) to a Receiving Office other than the United States
Receiving Office in the exact amount established for that Receiving
Office pursuant to PCT Rule 16, or the small entity basic national fee
set forth in Sec. 1.492(a), will be treated as a written assertion of
entitlement to small entity status even if the type of basic filing,
basic transmittal, or basic national fee is inadvertently selected in
error. The payment, by any party, of the small entity first part of the
individual designation fee for the United States to the International
Bureau (Sec. 1.1031) will be treated as a written assertion of
entitlement to small entity status.
* * * * *
0
9. Section 1.431 is amended by revising paragraph (c) to read as
follows:
Sec. 1.431 International application requirements.
* * * * *
(c) Payment of the international filing fee (PCT Rule 15.2) and the
transmittal and search fees (Sec. 1.445) may be made in full at the
time the international application papers required by paragraph (b) of
this section are deposited or within one month thereafter. The
international filing, transmittal, and search fee payable is the
international filing, transmittal, and search fee in effect on the
receipt date of the international application. If the international
filing, transmittal, and search fees are not paid within one month from
the date of receipt of the international application and prior to the
sending of a notice of deficiency, which imposes a late payment fee
(Sec. 1.445(a)(6)), the applicant will be notified and given a one-
month non-extendable time limit within which to pay the deficient fees
plus the late payment fee.
* * * * *
0
10. Section 1.445 is amended by revising paragraph (a) to read as
follows:
Sec. 1.445 International application filing, processing and search
fees.
(a) The following fees and charges for international applications
are established by law or by the director under the authority of 35
U.S.C. 376:
(1) A transmittal fee (see 35 U.S.C. 361(d) and PCT Rule 14)
consisting of:
(i) A basic portion:
(A) For an international application having a receipt date that is
on or after October 2, 2020:
Table 1 to Paragraph (a)(1)(i)(A)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $65.00
By a small entity (Sec. 1.27(a))......................... 130.00
By other than a small or micro entity...................... 260.00
------------------------------------------------------------------------
(B) For an international application having a receipt date that is
on or after January 1, 2014, and before October 2, 2020:
Table 2 to Paragraph (a)(1)(i)(B)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $60.00
By a small entity (Sec. 1.27(a))......................... 120.00
By other than a small or micro entity...................... 240.00
------------------------------------------------------------------------
(C) For an international application having a receipt date that is
before January 1, 2014: $240.00.
(ii) A non-electronic filing fee portion for any international
application designating the United States of America that is filed on
or after November 15, 2011, other than by the Office electronic filing
system, except for a plant application:
Table 3 to Paragraph (a)(1)(ii)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a small entity (Sec. 1.27(a))......................... $200.00
By other than a small entity............................... 400.00
------------------------------------------------------------------------
(2) A search fee (see 35 U.S.C. 361(d) and PCT Rule 16):
(i) For an international application having a receipt date that is
on or after October 2, 2020:
Table 4 to Paragraph (a)(2)(i)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $545.00
By a small entity (Sec. 1.27(a))......................... 1,090.00
By other than a small or micro entity...................... 2,180.00
------------------------------------------------------------------------
(ii) For an international application having a receipt date that is
on or after January 1, 2014, and before October 2, 2020:
Table 5 to Paragraph (a)(2)(ii)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $520.00
By a small entity (Sec. 1.27(a))......................... 1,040.00
By other than a small or micro entity...................... 2,080.00
------------------------------------------------------------------------
[[Page 46991]]
(iii) For an international application having a receipt date that
is before January 1, 2014: $2,080.00.
(3) A supplemental search fee when required, per additional
invention:
(i) For an international application having a receipt date that is
on or after October 2, 2020:
Table 6 to Paragraph (a)(3)(i)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $545.00
By a small entity (Sec. 1.27(a))......................... 1,090.00
By other than a small or micro entity...................... 2,180.00
------------------------------------------------------------------------
(ii) For an international application having a receipt date that is
on or after January 1, 2014, and before October 2, 2020:
Table 7 to Paragraph (a)(3)(ii)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $520.00
By a small entity (Sec. 1.27(a))......................... 1,040.00
By other than a small or micro entity...................... 2,080.00
------------------------------------------------------------------------
(iii) For an international application having a receipt date that
is before January 1, 2014: $2,080.00.
(4) A fee equivalent to the transmittal fee in paragraph (a)(1) of
this section that would apply if the USPTO was the Receiving Office for
transmittal of an international application to the International Bureau
for processing in its capacity as a Receiving Office (PCT Rule 19.4).
(5) Late furnishing fee for providing a sequence listing in
response to an invitation under PCT Rule 13ter:
Table 8 to Paragraph (a)(5)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $80.00
By a small entity (Sec. 1.27(a))......................... 160.00
By other than a small or micro entity...................... 320.00
------------------------------------------------------------------------
(6) Late payment fee pursuant to PCT Rule 16bis.2
0
11. Section 1.482 is revised to read as follows:
Sec. 1.482 International preliminary examination and processing
fees.
(a) The following fees and charges for international preliminary
examination are established by the director under the authority of 35
U.S.C. 376:
(1) The following preliminary examination fee is due on filing the
demand:
(i) If an international search fee as set forth in Sec.
1.445(a)(2) has been paid on the international application to the
United States Patent and Trademark Office as an International Searching
Authority:
Table 1 to Paragraph (a)(1)(i)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $160.00
By a small entity (Sec. 1.27(a))......................... 320.00
By other than a small or micro entity...................... 640.00
------------------------------------------------------------------------
(ii) If the International Searching Authority for the international
application was an authority other than the United States Patent and
Trademark Office:
Table 2 to Paragraph (a)(1)(ii)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $200.00
By a small entity (Sec. 1.27(a))......................... 400.00
By other than a small or micro entity...................... 800.00
------------------------------------------------------------------------
(2) An additional preliminary examination fee when required, per
additional invention:
Table 3 to Paragraph (a)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $160.00
By a small entity (Sec. 1.27(a))......................... 320.00
By other than a small or micro entity...................... 640.00
------------------------------------------------------------------------
(b) The handling fee is due on filing the demand and shall be as
prescribed in PCT Rule 57.
(c) Late furnishing fee for providing a sequence listing in
response to an invitation under PCT Rule 13ter:
Table 4 to Paragraph (c)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $80.00
By a small entity (Sec. 1.27(a))......................... 160.00
By other than a small or micro entity...................... 320.00
------------------------------------------------------------------------
0
12. Section 1.492 is amended by:
0
a. Revising paragraph (a);
0
b. Adding headings to the tables in paragraphs (b)(1) and (2);
0
c. Revising paragraphs (b)(3) and (4);
0
d. Adding a heading to the table in paragraph (c)(1);
0
e. Revising paragraphs (c)(2) and (d);
0
f. Adding a heading to the table in paragraph (e);
0
g. Revising paragraphs (f) and (h);
0
h. Adding a heading to the table in paragraph (i); and
0
i. Revising paragraph (j).
The revisions and additions read as follows:
Sec. 1.492 National stage fees.
* * * * *
(a) The basic national fee for an international application
entering the national stage under 35 U.S.C. 371:
Table 1 to Paragraph (a)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $80.00
By a small entity (Sec. 1.27(a))......................... 160.00
By other than a small or micro entity...................... 320.00
------------------------------------------------------------------------
(b) * * *
(1) * * *
Table 2 to Paragraph (b)(1)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(2) * * *
Table 3 to Paragraph (b)(2)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(3) If an international search report on the international
application has been prepared by an International Searching Authority
other than the United States International Searching Authority and is
provided, or has been previously communicated by the International
Bureau, to the Office:
Table 4 to Paragraph (b)(3)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $135.00
By a small entity (Sec. 1.27(a))......................... 270.00
By other than a small or micro entity...................... 540.00
------------------------------------------------------------------------
(4) In all situations not provided for in paragraph (b)(1), (2), or
(3) of this section:
Table 5 to Paragraph (b)(4)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $175.00
By a small entity (Sec. 1.27(a))......................... 350.00
By other than a small or micro entity...................... 700.00
------------------------------------------------------------------------
(c) * * *
(1) * * *
Table 6 to Paragraph (c)(1)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(2) In all situations not provided for in paragraph (c)(1) of this
section:
Table 7 to Paragraph (c)(2)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $200.00
By a small entity (Sec. 1.27(a))......................... 400.00
By other than a small or micro entity...................... 800.00
------------------------------------------------------------------------
(d) In addition to the basic national fee, for filing or on later
presentation at any other time of each claim in independent form in
excess of three:
Table 8 to Paragraph (d)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $120.00
By a small entity (Sec. 1.27(a))......................... 240.00
By other than a small or micro entity...................... 480.00
------------------------------------------------------------------------
(e) * * *
Table 9 to Paragraph (e)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(f) In addition to the basic national fee, if the application
contains, or is
[[Page 46992]]
amended to contain, a multiple dependent claim, per application:
Table 10 to Paragraph (f)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $215.00
By a small entity (Sec. 1.27(a))......................... 430.00
By other than a small or micro entity...................... 860.00
------------------------------------------------------------------------
* * * * *
(h) Surcharge for filing the search fee, the examination fee, or
the oath or declaration after the date of the commencement of the
national stage (Sec. 1.491(a)) pursuant to Sec. 1.495(c):
Table 11 to Paragraph (h)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $40.00
By a small entity (Sec. 1.27(a))......................... 80.00
By other than a small or micro entity...................... 160.00
------------------------------------------------------------------------
(i) * * *
Table 12 to Paragraph (i)
------------------------------------------------------------------------
-------------------------------------------------------------------------
* * * * *
------------------------------------------------------------------------
(j) Application size fee for any international application, the
specification and drawings of which exceed 100 sheets of paper, for
each additional 50 sheets or fraction thereof:
Table 13 to Paragraph (j)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $105.00
By a small entity (Sec. 1.27(a))......................... 210.00
By other than a small or micro entity...................... 420.00
------------------------------------------------------------------------
PART 11--REPRESENTATION OF OTHERS BEFORE THE UNITED STATES PATENT
AND TRADEMARK OFFICE
0
13. The authority citation for 37 CFR part 11 continues to read as
follows:
Authority: 5 U.S.C. 500; 15 U.S.C. 1123; 35 U.S.C. 2(b)(2), 32,
41; sec. 1, Pub. L. 113-227, 128 Stat. 2114.
0
14. Section 11.11 is amended by revising the section heading and
paragraphs (a)(1) and (2), adding paragraph (a)(3), revising paragraphs
(b)(1), (e), and (f)(1), and adding paragraph (f)(3) to read as
follows:
Sec. 11.11 Administrative suspension, inactivation, resignation,
reinstatement, and revocation.
(a) * * *
(1) A registered practitioner, or person granted limited
recognition under Sec. 11.9(b), must notify the OED director of the
postal address for their office, at least one and up to three email
addresses where they receive email, and a business telephone number, as
well as every change to each of said addresses and telephone number
within thirty days of the date of the change. A registered
practitioner, or person granted limited recognition under Sec.
11.9(b), shall, in addition to any notice of change of address and
telephone number filed in individual patent applications, separately
file written notice of the change of address or telephone number with
the OED director. A registered practitioner, or person granted limited
recognition under Sec. 11.9(b), who is an attorney in good standing
with the bar of the highest court of one or more states shall provide
the OED director with the identification number associated with each
bar membership. The OED director shall publish a list containing the
name, postal business addresses, business telephone number,
registration number or limited recognition number, and registration
status as an attorney or agent of each registered practitioner, or
person granted limited recognition under 11.9(b), recognized to
practice before the Office in patent matters. The OED director may also
publish the continuing legal education certification status of each
registered practitioner, or person granted limited recognition under
Sec. 11.9(b).
(2) Biennially, registered practitioners and persons granted
limited recognition may be required to file a registration statement
with the OED director for the purpose of ascertaining whether such
practitioner desires to remain in an active status. Any registered
practitioner, or person granted limited recognition under Sec.
11.9(b), failing to file the registration statement or give any
information requested by the OED director within a time limit specified
shall be subject to administrative suspension under paragraph (b) of
this section.
(3)(i) A registered practitioner, or person granted limited
recognition under Sec. 11.9(b), who has completed, in the past 24
months, five hours of continuing legal education credits in patent law
and practice and one hour of continuing legal education credit in
ethics, may certify such completion to the OED director.
(ii) A registered practitioner, or person granted limited
recognition under Sec. 11.9(b), may earn up to two of the five hours
of continuing legal education credit in patent law and practice by
providing patent pro bono legal services through the USPTO Patent Pro
Bono Program. One hour of continuing legal education credit in patent
law and practice may be earned for every three hours of patent pro bono
legal service.
(b) * * *
(1) Whenever it appears that a registered practitioner, or person
granted limited recognition under Sec. 11.9(b), has failed to comply
with paragraph (a)(2) of this section, the OED director shall publish
and send a notice to the registered practitioner, or person granted
limited recognition, advising of the noncompliance, the consequence of
being administratively suspended set forth in paragraph (b)(6) of this
section if noncompliance is not timely remedied, and the requirements
for reinstatement under paragraph (f) of this section. The notice shall
be published and sent to the registered practitioner, or person granted
limited recognition, by mail to the last postal address furnished under
paragraph (a) of this section or by email addressed to the last email
address furnished under paragraph (a) of this section. The notice shall
demand compliance and payment of a delinquency fee set forth in Sec.
1.21(a)(9)(i) of this chapter within 60 days after the date of such
notice.
* * * * *
(e) Resignation. A registered practitioner who is not under
investigation under Sec. 11.22 for a possible violation of the USPTO
Rules of Professional Conduct, is not subject to discipline under Sec.
11.24 or Sec. 11.25, or against whom probable cause has not been found
by a panel of the Committee on Discipline under Sec. 11.23(b), may
resign by notifying the OED director in writing that they desire to
resign. Upon acceptance in writing by the OED director of such notice,
that registered practitioner shall no longer be eligible to practice
before the Office in patent matters but shall continue to file a change
of address for five years thereafter in order that they may be located
in the event information regarding the practitioner's conduct comes to
the attention of the OED director or any grievance is made about their
conduct while they engaged in practice before the Office. The name of
any registered practitioner whose resignation is accepted shall be
removed from active status, endorsed as resigned, and notice thereof
published in the Official Gazette. Upon acceptance of the resignation
by the OED director, the resigned practitioner must comply with the
provisions of Sec. 11.116. A resigned practitioner is subject to
investigation and discipline for their conduct that occurred prior to,
during, or after the period of their resignation.
(f) * * *
(1)(i) Any administratively suspended registered practitioner, or
person granted limited recognition under
[[Page 46993]]
Sec. 11.9(b), may be reinstated provided the practitioner:
(A) Is not the subject of a disciplinary investigation or a party
to a disciplinary proceeding;
(B) Has applied for reinstatement on an application form supplied
by the OED director;
(C) Has demonstrated good moral character and reputation and
competence in advising and assisting patent applicants in the
presentation and prosecution of their applications before the Office;
(D) Has submitted a declaration or affidavit attesting to the fact
that the practitioner has read the most recent revisions of the patent
laws and the rules of practice before the Office;
(E) Has paid the fees set forth in Sec. 1.21(a)(9)(ii) of this
chapter; and
(F) Has paid all applicable delinquency fees as set forth in Sec.
1.21(a)(9)(i) of this chapter.
(ii) Any administratively suspended registered practitioner, or
person granted limited recognition, who applies for reinstatement more
than five years after the effective date of the administrative
suspension, additionally shall be required to file a petition to the
OED director requesting reinstatement and providing objective evidence
that they continue to possess the necessary legal qualifications to
render valuable service to patent applicants.
* * * * *
(3)(i) Any registered practitioner who has been endorsed as
resigned pursuant to paragraph (e) of this section may be reinstated on
the register provided the practitioner:
(A) Is not the subject of a disciplinary investigation or a party
to a disciplinary proceeding;
(B) Has applied for reinstatement on an application form supplied
by the OED director;
(C) Has demonstrated good moral character and reputation and
competence in advising and assisting patent applicants in the
presentation and prosecution of their applications before the Office;
(D) Has submitted a declaration or affidavit attesting to the fact
that the practitioner has read the most recent revisions of the patent
laws and the rules of practice before the Office;
(E) Has paid the fees set forth in Sec. 1.21(a)(9)(ii) of this
chapter; and
(F) Has paid all applicable delinquency fees as set forth in Sec.
1.21(a)(9)(i) of this chapter.
(ii) Any resigned registered practitioner who applies for
reinstatement more than five years after the effective date of the
resignation additionally shall be required to file a petition to the
OED director requesting reinstatement and providing objective evidence
that they continue to possess the necessary legal qualifications to
render valuable service to patent applicants.
PART 41--PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD
0
15. The authority citation for part 41 continues to read as follows:
Authority: 35 U.S.C. 2(b)(2), 3(a)(2)(A), 21, 23, 32, 41, 134,
135, and Pub. L. 112-29.
0
16. Section 41.20 is amended by revising paragraphs (a), (b)(1),
(b)(2)(ii), and (b)(3) and (4) to read as follows:
Sec. 41.20 Fees.
(a) Petition fee. The fee for filing a petition under this part is:
$420.00.
(b) * * *
(1) For filing a notice of appeal from the examiner to the Patent
Trial and Appeal Board:
Table 1 to Paragraph (b)(1)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $210.00
By a small entity (Sec. 1.27(a))......................... 420.00
By other than a small or micro entity...................... 840.00
------------------------------------------------------------------------
(2) * * *
(ii) In addition to the fee for filing a notice of appeal, for
filing a brief in support of an appeal in an inter partes reexamination
proceeding:
Table 2 to Paragraph (b)(2)(ii)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $525.00
By a small entity (Sec. 1.27(a))......................... 1,050.00
By other than a small or micro entity...................... 2,100.00
------------------------------------------------------------------------
(3) For filing a request for an oral hearing before the Board in an
appeal under 35 U.S.C. 134:
Table 3 to Paragraph (b)(3)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $340.00
By a small entity (Sec. 1.27(a))......................... 680.00
By other than a small or micro entity...................... 1,360.00
------------------------------------------------------------------------
(4) In addition to the fee for filing a notice of appeal, for
forwarding an appeal in an application or ex parte reexamination
proceeding to the Board:
Table 4 to Paragraph (b)(4)
------------------------------------------------------------------------
------------------------------------------------------------------------
By a micro entity (Sec. 1.29)............................ $590.00
By a small entity (Sec. 1.27(a))......................... 1,180.00
By other than a small or micro entity...................... 2,360.00
------------------------------------------------------------------------
PART 42--TRIAL PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD
0
17. The authority citation for 37 CFR part 42 continues to read as
follows:
Authority: 35 U.S.C. 2(b)(2), 6, 21, 23, 41, 135, 311, 312,
316, 321-326; Pub. L. 112-29, 125 Stat. 284; and Pub. L. 112-274,
126 Stat. 2456.
0
18. Section 42.15 is revised to read as follows:
Sec. 42.15 Fees.
(a) On filing a petition for inter partes review of a patent,
payment of the following fees are due:
(1) Inter Partes Review request fee: $19,000.00
(2) Inter Partes Review Post-Institution fee: $22,500.00
(3) In addition to the Inter Partes Review request fee, for
requesting a review of each claim in excess of 20: $375.00
(4) In addition to the Inter Partes Post-Institution request fee,
for requesting a review of each claim in excess of 20: $750.00
(b) On filing a petition for post-grant review or covered business
method patent review of a patent, payment of the following fees are
due:
(1) Post-Grant or Covered Business Method Patent Review request
fee: $20,000.00
(2) Post-Grant or Covered Business Method Patent Review Post-
Institution fee: $27,500.00
(3) In addition to the Post-Grant or Covered Business Method Patent
Review request fee, for requesting a review of each claim in excess of
20: $475.00
(4) In addition to the Post-Grant or Covered Business Method Patent
Review Post-Institution fee, for requesting a review of each claim in
excess of 20: $1,050.00
(c) On the filing of a petition for a derivation proceeding,
payment of the following fee is due:
(1) Derivation petition fee: $420.00.
(2) [Reserved]
(d) Any request requiring payment of a fee under this part,
including a written request to make a settlement agreement available:
$420.00.
(e) Fee for non-registered practitioners to appear pro hac vice
before the Patent Trial and Appeal Board: $250.00.
Andrei Iancu,
Under Secretary of Commerce for Intellectual Property and Director of
the United States Patent and Trademark Office.
[FR Doc. 2020-16559 Filed 7-31-20; 8:45 am]
BILLING CODE 3510-16-P