Strategic Goal 1: Optimize Patent Quality and Timeliness
The USPTO made significant progress in FY 2011 in meeting our goal of providing timely and quality patents. While less-than-planned spending authority has greatly impacted the USPTO’s ability to decrease patent pendency and the backlog, the Patent organization continued to respond to these challenges and obstacles by launching new and innovative initiatives to achieve its strategic goals. Despite budget constraints suspending routine programs such as examiner hiring, overtime, and training, the Patent organization succeeded in making progress by focusing on new methods and processes to increase efficiencies and strengthen effectiveness through collaboration, communication, and transparency.
In order to achieve its goal to reduce the backlog, the USPTO launched a major program to clean up the older cases in the pending backlog and more strictly manage its inventory in a first-in, first-out (FIFO) inventory environment. This initiative has resulted in a temporary rise in pendency in the near-term, because pendency is determined by cases that were examined during a particular period. However, clearing the oldest patent applications is important to the USPTO’s long-term success in reducing pendency and the backlog of unexamined patent applications. In an effort to eliminate the “tail” of backlog applications that were more than 16 months old at the beginning of the fiscal year and which had not yet received a first office action, the USPTO launched a unique initiative known as “Clearing the Oldest Patent Applications” (COPA). This initiative (Figure 4) was a critical first step toward reaching the USPTO’s strategic goal of providing first office actions on all new applications in an average of 10 months from their date of filing by 2015.
The improvements and increased efficiencies are shown in our performance metrics.
Objective 1: Re-Engineer Patent Process to Increase Efficiencies and Strengthen Effectiveness
During this fiscal year, the USPTO worked to reengineer the entire patent examination system to improve workload prioritization, decrease duplicative work, and streamline reviews in collaboration with applicants. Establishing and improving mechanisms that would result in accelerated examination were critical to this effort. Accelerating the patent process and boosting patent quality are essential in translating inventors’ ideas into job-creating businesses that spur economic growth and ensure U.S. competitiveness in the global market. In recognizing that applicants’ needs vary in patent prosecution time as well as in application costs, this has resulted in the development and implementation of new programs aimed at meeting these varied needs of stakeholders.
Project Exchange is an application acceleration pilot initiative that empowers qualifying applicants having two or more pending patent applications to accelerate the review status of one of the applications by abandoning a second unexamined application. This initiative, which gives applicants greater control over the processing speed of their applications, helps the USPTO to prioritize its workload while reducing the backlog of unexamined patent applications. After first testing the pilot by permitting its use only by qualifying independent inventors and small entities, the pilot was recently expanded to permit use by all patent applicants.
The Green Technology Pilot Program provides accelerated examination of inventions involving green technology, thereby promoting innovation in green technologies and reducing the pendency of patent applications critical to climate change mitigation. In response to feedback from applicants, the USPTO revised the Green Technology Pilot Program to allow more categories of technology to be eligible for expedited processing under the program. As a result, the Green Technology Pilot Program has increased the development and deployment of green technology and contributed to promoting U.S. competitiveness in this vital sector. More than 1,900 petitions have been granted to green technology patent applicants since the pilot began in December 2009.
The USPTO’s brochure illustrating the details of the Green Technology Program.
A new patent examination initiative that would provide applicants greater control over the speed with which their applications are examined, promote greater efficiency in the patent examination process, and allow the USPTO to deploy its resources to better meet the needs of innovators is the “Three-Track” Program. This new “Three-Track” Program has targeted application processing within 12 months for those applications deemed to be most important to applicants. Under the “Three-Track” Program, an applicant may request one of the following:
- Track I: a prioritized examination with an aggregate 12 month pendency goal;
- Track II: a traditional examination under the current procedures; or
- Track III: an applicant-controlled delay for up to 30 months prior to docketing for examination.
The Track I, prioritized examination, was put into motion after the passing of the AIA in late September. When fully implemented, the “Three-Track” Program will bring new products and services to the global market more quickly, thus helping to build businesses and create new jobs in the U.S.
The First Action Interview Program is another mechanism in which the USPTO is improving the examination process to increase effectiveness of patent prosecution. This program encourages examiners to hold interviews with applicants early in the prosecution process in order to facilitate resolution of issues for a timely disposal. This program has been expanded to include all utility applications in all technology areas, enhance efficiency, and provide more options to participants. The benefits of the program include the ability to advance prosecution of an application, enhanced interaction between applicant and the examiner, the opportunity to resolve patentability issues one-on-one with the examiner at the beginning of the prosecution process, and the opportunity to facilitate possible early allowance. The First Action Interview Program has not only provided applicants with more options in regards to procedures needed for examination, but it also has contributed dramatically to improving patent application quality.
For the first time in history, the IP community is able to work with the USPTO collaboratively in making the Manual of Patent Examining Procedure (MPEP) a state-of-the-art practice document through an interactive discussion tool specifically designed to solicit input from stakeholders on the revision and publication process of the MPEP. The innovative use of Web-based technology to successfully reengineer the MPEP has not only transformed the way the MPEP is expeditiously updated, but also has established a more collaborative revision process to foster interaction and contributions from stakeholders. This tool benefits practitioners as well as examiners by providing easy, accurate, and current guidance to ensure that all patent applications comply with the laws and regulations governing the patent system.
Another innovative use of Web-based technology is the USPTO’s launch of its new e-Petition System which automates the filing and decision process for eight patent related routine petition types. With e-Petition, data is input through a secure Web interface and the petition is decided automatically, eliminating months of waiting for these types of petitions to be docketed, decided, and uploaded into Public Patent Application Information Retrieval. Petitioners will have more control over when their petitions are filed and answered through the new e-Petition system and this is especially advantageous for critical petitions, such as petitions to withdraw from issue. Moreover, electronic petition decisions will also decrease the need for renewed petitions and reduce the inventory of petitions awaiting decision, thus freeing up resources currently used to decide the eight types of petitions. Processing and issuing more petition decisions electronically provides a great improvement in service to patent applicants as well as increases the efficiency of the USPTO. Table 3 below indicates the relative cost effectiveness of the entire patent examination process over time, or the efficiency with which the organization applies its resources to production.
Objective 2: Increase Patent Application Examination Capacity
Deputy Director of the USPTO Teresa Stanek Rea speaks at the Patent Training Academy’s May graduation in Alexandria, Virginia.
The USPTO continues to increase its examination capacity by employing new recruitment and development models to hire, train, and retain a highly skilled and diverse workforce. While continuing to draw candidates from traditional sources, a targeted hiring program was launched to focus on recruiting experienced former examiners and IP professionals. The new hiring model seeks individuals with appropriate technology backgrounds who also have previous IP experience for patent examiner positions. In contrast with previous hiring which focused on scientific background and experience, this new hiring model places more emphasis on recruiting candidates with significant IP experience. This will result in reduced training time as well as an increased ability to examine applications much sooner than a new hire with little or no IP experience, thereby increasing overall production output.
Additionally, plans provide for the establishment of a nationwide workforce using telework from off-site locations to hire highly skilled, experienced IP professionals interested in joining the USPTO, but who do not wish to relocate to the Washington, D.C. region. This will directly aid in the hiring of patent examiners as well as expand the presence of the USPTO. Development of a nationwide workforce enables the USPTO to widen its hiring practices in an effort to meet its hiring targets as well as tap into the expertise that lies outside the USPTO’s geographical boundary. Plans for opening the first satellite office, initially scheduled to open in Detroit, Michigan in August 2011, were temporarily suspended due to FY 2011 budget constraints, but have now been resumed with the passage of the AIA.
Use of overtime is a vital component in reducing the backlog of pending patent applications and achieving the USPTO’s pendency goals. Each overtime hour worked is directly tied to production output because it is straight examining time. As such, overtime has proven to be more efficient on a per-hour basis than equivalent regular-time hours, which must also incorporate the cost of training, employee leave, and other benefits. Unfortunately, overtime has been reduced this year due to the lack of adequate funding in FY 2011.
Additional patent examination capacity will also be gained by continuing to contract for the searching on PCT international applications thereby allowing examiners to conduct the examination process on U.S. national applications. By contracting this function, contractors, instead of patent examiners, would provide international search reports and written opinions of the International Searching Authority, thus allowing examiners to focus on reducing the backlog of U.S. applications. PCT search contracting has been greatly reduced this year, also due to the lack of adequate funding.
However, despite the fiscal challenges in FY 2011, the USPTO is nonetheless managing to work within its means to continue making improvements and maintaining a highly efficient workforce.
Objective 3: Improve Patent Pendency and Quality by Increasing International Cooperation and Work-Sharing
Patent processing times are primarily gauged by two measures – Average First Action Pendency (Table 4) and Average Total Pendency (Table 5). Average First Action Pendency is the average length of time it takes from filing until an examiner’s initial determination of the patentability of an invention. Average Total Pendency is the average length of time it takes from filing until the application is issued as a patent or abandoned by the applicant. Average First Action Pendency has slightly increased from the previous year. This increase was expected due to the efforts focused on clearing up the oldest patent applications from the backlog through the COPA initiative. However, with sufficient funding and the ability to hire and utilize overtime, the USPTO is confident that it will not only meet but exceed its target goals for next year.
Target Not Met.
1: Outyear targets subject to change. (back to text)
1: Outyear targets subject to change. (back to text)
An ongoing effort to improve examination efficiency and to use resources wisely is the development of work sharing. Work sharing has evolved as a significant tool in addressing pendency. Under the work sharing umbrella are the Patent Prosecution Highway (PPH), Strategic Handling of Applications for Rapid Examination (SHARE), and First Look Application SHaring (FLASH). These work sharing programs reduce re-work, increase collaboration, and provide consistency between IP offices. The benefits of work sharing are immense. The USPTO continues to work with the major IP offices toward collaborative work sharing solutions that aid in faster, higher quality patents.
PPH has been implemented with 15 other offices worldwide. In the PPH program, after an office of first filing determines that an application contains at least one allowable claim, the applicant may request that the second office fast-track examination of corresponding claims in its corresponding application filed in the office of second filing. By using the PPH, an applicant can receive patentability determinations faster in multiple jurisdictions, saving time and money in the process. Offices greatly benefit from work sharing efficiency and quality gains.
Beginning with the first PPH with the Japan Patent Office (JPO) in 2006, the USPTO has received over 7,900 PPH requests (Figure 5), and is close to meeting the goal of 8,000 requests by the end of calendar year 2011. Other important PPH metrics include:
- An overall allowance (Figure 6) rate of over 88 percent, about double the overall USPTO average allowance rate;
- A reduction of almost one entire office action per disposal versus the USPTO average of 2.5 actions/disposal;
- A lower average appeal rate of 1.7 percent versus the overall USPTO average appeal rate of 2.3 percent; and
- An 8.8 percent rate of requests for continued examination versus the USPTO rate of 30.6 percent requests for continued examination.
This program was selected by the then Secretary of Commerce, Gary Locke, as one of the first two programs to be awarded the Department’s first Performance Excellence Award for outstanding efforts to improve business processes.
Furthermore, the USPTO is piloting aspects of a concept known as SHARE. According to the SHARE concept, where corresponding applications are filed in multiple offices, the USPTO appropriately prioritizes and balances workloads to be able to maximize the re-use of foreign search and examination results, and minimize duplication of examination work done in other IP offices. One important advantage of SHARE relative to the PPH is that SHARE does not depend on an applicant’s request to reutilize work; it operates independently of such requirements. As such, its potential is not limited in the same way that PPH is limited as an applicant-driven process.
Additionally, the USPTO launched a pilot with the European Patent Office (EPO) and the JPO in their implementation of the SHARE concept, called FLASH. Under FLASH, the USPTO identifies applications filed with it for which a corresponding application was later filed at EPO or JPO, and then undertakes a search and examination of that application within a time frame in which that work can be optimally reused by the EPO or JPO on their corresponding application.
To date, the USPTO has issued 506 examination reports out of 1,058 applications identified for FLASH participation, and has provided 221 of the reports to the EPO and JPO for reuse. The remaining reports will be released once the U.S. application has been published. Significant metrics captured to date include:
- Average number of days from notification to the examiner to mailing of a first office action: 39 days; and
- Average number of months pendency from application filing to first office action: 15.1 months for FLASH as compared to 28.0 months USPTO average pendency to first action (Table 4) for all applications.
Objective 4: Measure and Improve Patent Quality
Reducing patent pendency is only one part in improving the IP system – patent quality must also be maintained and improved. The USPTO continues to expand its quality management program from top to bottom by focusing on improving the quality of the initial patent application and the entire examination and prosecution process. Quality improvement is a continuous process that must include public input on the best ways to improve quality as well as measure that improvement without extending the overall examination process. As a result of the collaboration between the USPTO, the PPAC Quality Task Force and the patent community, a new Composite Quality Metric was developed for reporting in FY 2012. This metric measures seven diverse aspects of the examination process to form a more comprehensive composite of quality metric. One measure of the composite metric, the Quality Index Report tracks the actions taken by examiners during prosecution of patent applications. It further provides a statistical analysis of quality-related events in the prosecution, such as the reopening of final rejections and second non-final actions. Identifying quality issues prior to final action allows for corrective actions to be taken via coaching, mentoring, and training.
To better measure the quality of services provided by the patent examining staff, the USPTO expanded its Patents External Quality Survey. This survey gives applicants an opportunity to provide feedback on the patent process on a semi-annual basis. The survey provides a valuable complement to other quality initiatives, such as enhancing interview practice. The survey results (Figure 7), along with customer outreach efforts and other initiatives, enable the USPTO to improve service quality based upon the input collected through the survey process. In the Spring 2011 survey, 36 percent of customers felt that overall examination quality had slightly or significantly improved over the previous three months. These levels are consistent with those observed over the past year and remain some of the most positive ratings the USPTO has achieved since the inception of the survey in 2006.
Other measures of patent quality include – the Final Disposition Compliance Rate (Table 6) and the In-Process Compliance Rate (Table 7). The Final Disposition Compliance Rate provides the percentage of Utility, Plant, Reissue, Design (UPRD) allowances and final rejections reviewed that were found to be compliant with applicable rules and laws regarding final patentability determination. The In-Process Compliance Rate provides the percentage of UPRD office actions prior to allowance or final rejection that were found to be compliant with applicable rules and laws. In changing its focus from end-process reviews to an emphasis on front-end quality, the USPTO continues to make strides in improving the quality of its products and services.
|2011||95.6% - 96.5%||95.4%|
|2012||95.6% - 96.7%|
|2013||95.6% - 96.7%|
|2011||94.6% - 95.6%||95.2%|
|2012||94.6% - 96.0%|
|2013||94.6% - 96.3%|
In providing more effective training, the USPTO further enhances patent examination fundamentals, communication, and cooperation between the examiner and applicant. In addition to the highly successful compact prosecution training and refresher training program that encompasses over 20 training modules designed to enhance examiners’ knowledge and skills in procedural and legal topics pertaining to patent examination, the USPTO has also implemented the Patent Examiner Technical Training Program (PETTP) which provides patent examiners with direct access to experts who are able to share their technical knowledge on prior art and industry standards in areas of emerging technologies and established technologies. The PETTP provides an excellent opportunity for communication between patent examiners and the experts who work in the various technologies that are examined throughout the USPTO. This enhanced communication contributes to improving overall patent quality and decreasing patent pendency.
In addition, the Office of Patent Training (OPT) has provided a two-phase training program to new supervisory patent examiners which provides coaching and mentoring modules in an effort to help patent examiners reach their full potential. Patent managers and supervisors will continue to participate in a Leadership Development Program which focuses on educating and creating leaders. Lastly, OPT will continue to maintain and improve the effectiveness of the ISO-9001 (International Organization for Standardization) certified New Patent Examiner Training Program.
Quality improvement also relies on clearly defining objective measures that will be universally applied during the performance appraisal process, as well as developing a framework that focuses on coaching, mentoring, and training. Revising Senior Executive Service (SES) Performance Appraisal Plans (PAPs) to ensure alignment with the USPTO 2010-2015 Strategic Plan goals and objectives as well as developing the framework for modifying new patent examiner PAPs that focus on patent quality and reducing pendency will provide greater transparency, educate employees on their responsibilities, and enable managers to set clear expectations and objectives for the achievement of organizational goals. Reformulating PAPs not only advances management and employee development, but lays the foundation for long-term improvement in providing timely and high quality examination of patent applications.
The BPAI issued numerous informative decisions on substantive and procedural issues in FY 2011. This year’s decisions relate to current issues of concern to the IP community, including: the written description requirement; the limits of the BPAI’s jurisdiction in reexamination proceedings; in interferences,1 the rules pertaining to publication of the record of an interference; and burden of proof the party seeking to assert inventorship rights in an interference proceeding bears. BPAI’s informative opinions help provide insight into BPAI procedural issues and legal standards, and clarify its jurisdiction. The Agency is currently considering whether and what kind of metrics will result from the implementation of the AIA.
Objective 5: Improve Appeal and Post-Grant Processes
The BPAI continues to improve communications with the Patent organization. This year, BPAI launched a program where senior patent examiners are detailed to the BPAI in order to develop a high-level understanding of its operations, decision-making processes, and constraints. Detailed examiners will work with Administrative Patent Judges by researching both technical issues raised in appealed cases and legal issues, and applying court decisions in legal analysis to assist as the judges craft their decisions. BPAI continues to liaise with technology center representatives in order to enhance operational understanding throughout the USPTO.
Objective 6: Develop and Implement the Patent End-To-End Processing System
Under Secretary Kappos stated, “The intellectual property community deserves to have high quality patents and trademarks issued in a timely manner. Intelligent investment in the USPTO IT infrastructure holds the potential to dramatically accelerate the USPTO towards that goal. That’s why I’m aggressively pushing the agency to completely modernize our IT systems—not just to incrementally improve, but to radically re-invent our systems from scratch.”2 A new patent processing system that meets the USPTO’s goals of timely patent examination is critical to innovators and to the American economy. The USPTO proposes to modernize its patent prosecution system by migrating to fully-electronic, text-based application and examination processes and by eliminating the fragmentation of existing examination tools.
In FY 2011, the USPTO: (1) released the Patent Application Text Initiative project to two patent work units to develop in-house Optical Character Recognition capability and provide text-based documents and analytical tools; (2) established the integrated program team and hired its portfolio manager; (3) developed three prototypes for front-end solutions and received feedback from more than 2,000 examiners; (4) oversaw and analyzed three competing back-end prototypes to assess Patent End-to-End (PE2E) implementation needs; (5) implemented an enterprise-class, scalable architecture that runs on an infrastructure that leverages industry-leading technology; and (6) initiated agile development of high-priority functionality and deployed initial PE2E functionality to users in the Patent organization Central Reexamination Unit.
The USPTO continues to provide and enhance the tools for applicant’s use for patent application filing. The use of electronic filings as shown in Table 8 continues to rise, now at 93.1 percent, from last year when 89.5 percent of applications were filed electronically.
1: Preliminary data and is expected to be final by December 2011 and will be reported in the FY 2012 PAR. (back to text)
2: Outyear targets subject to change. (back to text)
The improvements and increased efficiencies can be seen in some of our metrics in Figure 8.
1: A patent interference is a determination of which party first invented the commonly claimed invention (priority contest) between an application and either another application or an issued patent. (back to text)
2: David Kappos Blog: “Re-Thinking our IT Infrastructure”, April 2010 (back to text)