Intellectual Property Today, June 1999
Oppedahl of Oppedahl & Olson
Carl Oppedahl is a partner in the Dillon, Colorado firm of Oppedahl & Olson LLP. His firms web site is at http://www.oppedahl.com .
For over a century the time-honored approach for obtaining US patent protection has been the filing of an ordinary US patent application. This article describes reasons why the time-honored approach may no longer be the best approach. Rather than filing a regular patent application under 35 USC sec. 111(a), it may well be that the inventor is better served by filing a PCT application that designates the US and by having international preliminary examination performed by the USPTO. Using the PCT approach the patent may issue more quickly, and if multiple inventions are involved the patent owner may save substantially on issue fees and maintenance fees. Whats more, if the PCT application was going to be filed anyway (for purposes of foreign filing), then the PCT approach may save money as compared with filing of a regular 111(a) patent application.
Most practitioners know that entry into the US national phase from a PCT application that designates the US is done no later than 20 months after the priority date (if no Demand for Preliminary Examination was filed), or 30 months after the priority date (if a Demand for Preliminary Examination was filed). Most also know that the mechanics of the entry into the US national phase are quite simple the applicant files a two-page form PTO/1390.
In a "regular" patent application under 35 USC sec. 111(a), there is a "base" fee of $760 or $380. Entry into the US national phase from a PCT application has a "base fee" as well, but the amount ranges anywhere from $970 to a mere $48, depending on which patent office did the earlier work in the PCT application.1 The policy underlying the fee amounts seems to be that if the International Preliminary Examination Report ("IPER") was done by the USPTO, then there is little or no additional work to be done by the US Examiner who gets the national-phase file; the base fee may be as little as $48. If the IPER was not done by the USPTO, but the International Search Report ("ISR") was done by the European Patent Office ("EPO") or the Japanese Patent Office ("JPO"), the base fee increases to $840 or $420, while if the IPER was done by some patent office other than the USPTO and the ISR was done by some patent office other than the USPTO, EPO, or JPO, the base fee rises to $970 or $485.
If the IPER was done by the USPTO, then Form 1390 asks the application to answer one more question, namely, is it the case that all of the claims now being presented in the national phase application are claims which satisfy the three conditions of PCT Article 33(1)-(4)? Stated differently, the question is whether the claims were found to be novel, to have industrial applicability, and to constitute an "inventive step". (These three conditions correspond to the traditional US patentability requirements of novelty, utility, and unobviousness.) If the answer is in the affirmative, then the filing fee drops to a mere $48 (or $96). It is so because the claims were already found patentable in the preliminary examination.
A close study of the patent regulations applicable to the PCT US national phase reveals a rather obscure and apparently little-known additional consequence of the claims being found patentable in the international preliminary examination. As prescribed in 37 CFR sec. 1.496(b), the Examiner is required to take up the application "out of order". Barring something unexpected, this should mean an immediate Notice of Allowance and, if the Patent Office lives up to its recently stated goal of issuing patents within a month of payment of the issue fee2, an immediate issuance of the patent.
What should be appreciated is how much faster this might give an applicant his or her issued patent when compared with a "regular" patent application. According to recent USPTO statistics3, a "regular" patent application might sit untouched in an examining group for as much as 39 months after filing before it receives a first office action, and of course the allowance might take months or years after the first office action. There is no particular timetable requiring an Examiner to search and examine a patent application by any particular date. A newly filed patent application is simply placed at the "end of the line" to be taken up after all of the other work has been done. It is commonplace in some art areas to find that it takes five years or longer to obtain a patent.
In contrast, if a PCT application is filed, the Examiner is held to a very strict timetable. The ISR, for example, is required to be done within three months of when the "Search Copy" of the PCT application is received by the International Searching Authority, or within nine months from the priority date, whichever is later. (The ISA receives the Search Copy from the Receiving Office, and usually this happens within a month or two of when the PCT application was filed.4) The urgency comes partly from the fact that the PCT publication, which comes eighteen months after the priority date, is supposed to include the ISR.5 An additional reason why the Examiner is held rather strictly to the timetable for the ISR is that the applicant faces a decision at about the nineteenth month whether or not to spend more money on the application (either to demand preliminary examination at the nineteenth month or to enter the national phase prior to the twentieth month), and the application is entitled to see the ISR to help in making that decision.
The Examiner is likewise under strict pressure to finish the IPER according to a timetable, namely by the 28th month after the priority date. One reason for this pressure, of course, is that the applicant has to decide whether to spend the money to enter the national phase prior to the thirtieth month, and is supposed to be able to consider the IPER when making this difficult decision. Another reason is that the IPER is supposed to be provided to the various countries in which the applicant enters the national phase, so that they may refer to it when conducting their own examination of the application.
There is yet another benefit to the approach of filing a PCT application designating the US and having the international preliminary examination done by the USPTO, and it stems from the different ways in which lack of unity of invention is handled. In a regular US application that turns out to contain more than one invention, the Examiner imposes a restriction requirement, and the practical result is the need to file one or more divisional applications. Each has a filing fee, and if all goes well each also has an issue fee and maintenance fees.
In contrast, a PCT application handles lack of unity of invention differently. When the lack of unity of invention is detected during the search phase, the Examiner sends the applicant form PCT/ISA/206, "Invitation to Pay Additional Fees". This form indicates that if the second through n-th inventions are to be searched, the applicant must pay additional fees, at $2106 per extra invention. Similarly, when the application reaches the preliminary examination stage, the applicant receives Form PCT/IPEA/405, "Invitation to Restrict or Pay Additional Fees". For preliminary examination of the second through n-th inventions, additional fees of $1407 per invention must be paid (or $270 per invention if the International Search was not done by the USPTO).
But, importantly, if the several inventions are found to satisfy the three conditions of novelty, inventive step, and industrial applicability, then the applicant is entitled to enter the US national phase with all these inventions in a single application. The filing fee is the modest $48 or $96, and the Examiner in the national phase is required to take the application "out of order", all notwithstanding the presence of several inventions. When the allowance arrives, only one issue fee need be paid, and only one set of maintenance fees need be paid in the years that follow.
It would seem at first glance that this accelerated PCT procedure, which enjoys a greatly reduced filing fee, is nothing but good news for the applicant. But what should not be forgotten is the duty of disclosure under 37 CFR sec. 1.56. This duty must be fulfilled, yet there is no mechanism in the PCT process for filing of an Information Disclosure Statement (IDS) such as that set forth in 37 CFR sec. 1.97. Under present patent rules the earliest opportunity for the filing of an IDS comes when the application enters the national phase. But if a $48 national- phase application reaches an Examiners desk, the presumption imposed upon the Examiner by the Patent Office is that all the work was done in the IPER and that it should not take very long for the Examiner to allow the case. A voluminous IDS that is dropped on the Examiners desk at this time could well present a substantial burden for the Examiner. Later in litigation, an accused infringer might argue that the Examiner never had a proper opportunity to fully consider such an IDS. Thus, under the present patent rules, it seems prudent as well as courteous to the Examiner, when one is drafting a PCT application designating the US, to include a mention of pertinent references in the background section of the PCT application. This permits the Examiner to consider the references at the time that the substantive examination is taking place, rather than later when the Examiner is under a burden to allow the national-phase case "out of order".8
It may be seen, then, that the applicant who is faced with the choice of filing a regular 111(a) application or a PCT application designating the US may well benefit from the PCT approach. The patent may issue more quickly, and if multiple inventions are involved the patent owner may save substantially on issue fees and maintenance fees. The patent owner may also save money on filing fees.
1. The fees for entry into the US national phase, including the $48 fee emphasized in this article, are found at 37 CFR sec. 1.492. This article does not discuss separately the many PCT fees payable upon initial filing and upon the demand for preliminary examination, but of course such fees benefit the applicants filing efforts in countries outside of the US as well as the efforts within the US.
2. On February 11, 1999, the USPTO announced a goal of issuing patents within four weeks of the payment of the issue fee.
3. The March 23, 1999 Official Gazette gave a "new case date" of December 7, 1995 for group 3640, which is the filing date of the oldest patent application in that group that had not yet received a first office action on the merits. There are thirty-four groups (excluding design) and twenty-two of them were listed as having "new case dates" in 1996 or earlier years.
4. What must be kept in mind is that for many US-based inventors, the USPTO fulfils the roles of the PCT Receiving Office, the PCT International Searching Authority, and the PCT International Preliminary Examining Authority. Thus there is little opportunity for delay as the Receiving Office sends the Search Copy of the PCT application to the International Searching Authority, since it is simply a delivery from one part of the USPTO to another.
5. Occasionally the Examiner will miss the due date for the ISR, in which case the PCT application is published without the search report, and the search report is published later.
6. If the US is the International Searching Authority.
7. Assuming the USPTO has been selected as the International Preliminary Examining Authority.
8. It seems to the author that this notion of disclosing prior art at the time of substantive examination is important enough that 37 CFR sec. 1.496(b) or 37 CFR sec. 1.492 should be revised to include a presumption that the applicant has disclosed the prior art that would have been in an IDS. Stated differently, the filing of national-phase papers availing oneself of the $48 filing fee and "out of order" prosecution should constitute a representation that the applicant is unaware of any art that is more pertinent than that already considered in the PCT process.
This page is http://www.oppedahl.com/pubs/pctfaster.htm .