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Collage showing images with one-word descriptors from the U S P T O Fiscal Year 2007 Performance and Accountability Report cover that reinforces the report's tagline of Transforming for the Future Today.
Performance and Accountability Report Fiscal Year 2007
Management's Discussion and Analysis

Table of Contents | Management | Financial | Auditor | IG | Other

Strategic Goal 1: Optimize Patent Quality and Timeliness

Photo of Patent Examiners Dan McNally and DeMaris Wilson consulting with one another. Many examiners from different units now discuss common issues and help each other solve problems.

Sharing Ideas — Patent Examiners Dan McNally and DeMaris Wilson consult with one another. Many examiners from different units now discuss common issues and help each other solve problems.

High quality and timely examination of patent applications advances science and technology and creates the certainty innovators need in capital driven markets. The Patent organization is working closely with the public and its stakeholders to find the best ways to ensure that the U.S. patent system continues to promote innovation and U.S. competitiveness in the global economy. Proposed solutions will not be limited by existing laws, rules, processes or procedures. The following are the priorities for achieving this goal and our accomplishments in FY 2007.

Providing High Quality

The Patent organization built on its successes from FY 2006 and improved its record-breaking performance by examining more applications at an even higher level of quality. Hiring and training of large numbers of new examiners continued so the Patent organization could address growing patent pendency, which stood at 25.3 months from filing to first action and 31.9 months until issue or abandonment at the end of the fiscal year. The Patent Training Academy was expanded to better train all newly hired examiners and additional resources were committed to make this initial training as effective as possible.

Enhanced reviews of allowed patent applications in selected technologies continued. Appeals specialists were added to each Technology Center to assist with pre-appeal conferences and improve the quality of appeal briefs. Processing of appeals was centralized to ensure compliance of both examiners and applicants with formal requirements for appeals. Partnerships with industry were expanded, working with the nanotechnology, biotechnology, and business methods taxation areas to keep patent examiners’ knowledge current. Through these efforts and other initiatives, the Patent organization reached an allowance compliance rate of 96.5 percent and an in-process compliance rate of 92.2 percent, while hiring and training 1,215 examiners.

The Patent organization took the lead in creating detailed examination guidelines for implementing the Supreme Court’s decision on obviousness in KSR International Co. v. Teleflex, Inc., and trained the entire examining corps in applying these guidelines.

Photo of The USPTO Board of Patent Appeals and Interferences which reviews patent decisions when requested by applicants meeting certain requirements. A panel of at least three members of the Board reviews each case. The Board increasingly affirmed patent examiners' decisions in FY 2007, in part as a result of numerous patent examination quality initiatives.

Case Review — The USPTO Board of Patent Appeals and Interferences reviews patent decisions when requested by applicants meeting certain requirements. A panel of at least three members of the Board reviews each case. The Board increasingly affirmed patent examiners' decisions in FY 2007, in part as a result of numerous patent examination quality initiatives.

Photo of Primary Patent Examiner Jessica Ward using dual-monitors, which help examiners work more efficiently by letting them compare information in multiple documents and applications more easily.

Working Smarter — Primary Patent Examiner Jessica Ward uses dual-monitors, which help examiners work more efficiently by letting them compare information in multiple documents and applications more easily.

Patent Pendency Performance – The two primary measures of Patent organization processing are average first action pendency (the time from filing to first action) and average total pendency (the time from filing until the application is issued as a patent or abandoned by the applicant).

Graph summarizing the average first action pendency for patents issued for the last four fiscal years.D

Graph summarizing the average total pendency for patents issued for the last four fiscal years.D

Patent Quality Performance – The Patent organization continues to improve the quality of its products and services using in-depth reviews of work in progress and enhanced end-process reviews.

Graph summarizing the patent in-process examination compliance rate for last four fiscal years.D

Graph summarizing the patent allowance compliance rate for the last four fiscal years.D

Improving E-Systems

The Patent organization continued to transition to an end-to-end, text-based patent prosecution system, and increased the number of examiners able to work from home, while providing them with better electronic tools to perform their work. Electronic filings more than tripled from 14.2 percent in FY 2006 to 49.3 percent in FY 2007. Electronic management of patent applications continued at 99.9 percent in FY 2007. The USPTO continues to explore options that will move toward complete electronic filings.

The USPTO piloted an improved collaboration tool for work-at-home examiners, which allows them to submit their work for review and have it credited electronically. An additional 503 examiners joined the hoteling work-at-home program, and 2,314 examiners were given remote access to their workstations to improve their productivity. The Agency also continued the development of a text based Patent File Wrapper (PFW) system, with a goal of replacing the current image based system. The USPTO piloted a virtual art unit to evaluate remote management and training needs and a hoteling work-at-home program for patent technical support staff.

Photo of Patent Training Academy instructor and Supervisory Patent Examiner Dennis Chow leading a class of new patent examiners through the discipline of patent examination. The Academy was started in 2006 to effectively train the more than 1,200 patent examiners now hired annually. The ninth class of examiners graduated in September 2007.

Class of 2007 — Patent Training Academy instructor and Supervisory Patent Examiner Dennis Chow leads a class of new patent examiners through the discipline of patent examination. The Academy was started in 2006 to effectively train the more than 1,200 patent examiners now hired annually. The ninth class of examiners graduated in September 2007.

E-Filing and E-Management of Patent Applications — Electronic filings more than tripled from 14.2 percent in FY 2006 to 49.3 percent in FY 2007. Electronic management of patent applications continued at 99.9 percent in FY 2007. The USPTO continues to explore options that will move toward complete electronic filings.

Graph summarizing the patent applications filed electronically for the last four fiscal years.D

Graph summarizing the patent applications managed electronically for the last four fiscal years.D

Exploring Range of Options to Meet Challenges

In an effort to continue increasing patent quality, the USPTO introduced the Accelerated Examination program. These procedures require the applicant to perform a pre-examination search and provide the examiner with a comparison of the results of that search to the claimed invention. In exchange, the USPTO completes prosecution of the application within a year. In the first year of the program, 24 patents were issued, one in four months from filing.

In order to focus on examination and improve the overall quality of patents, the USPTO published rules that will limit the number of claims in an application to a reasonable number, while giving applicants the option of filing an examination support document if they need more claims. The USPTO also published rules that require applicants seeking to file repeated continuation applications to show the need for the additional applications. Rules are also expected to be published requiring applicants to provide similar support information when they submit many prior art references in an application.

The USPTO collaborated in a peer-to-patent pilot that encourages the public to review volunteered published applications and submit prior art and commentary on what they believe to be the best prior art to consider during examination. Through the Patent Public Advisory Committee, the USPTO is reaching out to the user community to determine what types of examination options should be provided as alternatives to the current system.

Photo of Patent Commissioner John Doll and Deputy Patent Commissioner Peggy Focarino conferring with William Dondero, patent examiner and mentor for the Hayfield Robotics Team, at a 'For Inspiration and Recognition of Science and Technology,' (or FIRST) regional competition. The USPTO works with FIRST and many other nonprofit organizations to encourage young people to become interested in math, science, and innovation.

Helping the Next Generation — Patent Commissioner John Doll and Deputy Patent Commissioner Peggy Focarino confer with William Dondero, patent examiner and mentor for the Hayfield Robotics Team, at a “For Inspiration and Recognition of Science and Technology,” (or FIRST) regional competition. The USPTO works with FIRST and many other nonprofit organizations to encourage young people to become interested in math, science, and innovation.

Patent Efficiency –The following metric measures the relative cost-effectiveness of the entire patent examination process over time, or the efficiency with which the organization applies its resources to production.

Graph summarizing the efficiency rates for patents issued for the last four fiscal years.D

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