02/06/2004 15:8 FAX
FOLEY 10 LARD NER
T O R N E Y 9 A T L A w
facsimile February 6, 2004
(703) 306-4134
attention of Harry I. Moatz
attached is the
RECEIVED

FEB 0 6 2004
Testimony of
Harold C. Wegner
OFFICE OF ENROLLMENT
AND DISCIPLINE
concerning the proposed Modification to Code of Federal Regulations, Changes to
Representation of Others Before the United States Patent and Trademark Office,
Rulemaking Notice of December 12, 2003, 68 Fed. Reg. 69442
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02/08/2004 15:46 FAX X1002

DEPARTMENT OF COMMERCE
Patent and Trademark Office
Testimony of Harold C. Wegner
DEPARTMENT OF COMMERCE
Patent and Trademark Office

Testimony of

Harold C. Wegner

concerning the proposed Modification to Code of Federal Regulations, Changes to
Representation of Others Before the United States Patent and Trademark Office,
Rulemaking Notice of December 12, 2003, 68 Fed. Reg. 69442

subnutted via facsimile February 6, 2004
(743) 306-4134, attention of Harry 1. Moatz

This is responsive to the invitation to provide testimony concerning the
above-captioned regulations that would effect a change to the Code of Federal
Regulations, Changes to fepresentation of Others Before the United States Patent
and Trademark Offzue, Rulemaking Notice of December 12, 2003, 68 Fed. Reg.
69442.

Harold C. Wegner is the former Director of the Intellectual Property Law Program and Professor of Law at the George Wasbingtoa University Law Scbool and a partner in the firm of Foley & Lardner. He is also a past Chair of the Bar Association of the District of Columbia PTC Section that has been deeply involved with the proposed rulemaking, including a public forum that was held on January 21, 2004; his paper for that forum, PTO Recertification: Fractioning The Patent .bar, is included in this testimony in abridged form as an appendix beginning at page 16 -numbered as App., p, 1.

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DEPARTMENT OF COMMERCE
Patent and Trademark Office
Testimony of Harold C. Wegner

The testimony does not necessarily reflect the views of the firm or any client of the firm or any other organization with which Prof. Wegner is affiliated; the views expressed in the Appendix are solely those of the author and do not necessarily reflect the views of the aforementioned Bar Association.

The testimony, here, is limited to the issues of the ever more globalized practice at the .PTO and the broader vision of the Under Secretary of Commerce and how the regulations should be adapted to fit within the framework of that vision. In particular, the testimony here focuses upon the paradigm of the Japanese-U.S. interface and how this critical relationship must be fostered and grown to better benefit American innovation through an overall strengthening of the U_S. patent system and the quality of patents that are granted by our government:

The testimony has four elements in terms of objectives that are reflected in §§ I-IV axed means for their implementation as expressed in §§ V-VI:

I. THE VISION OF GLOBAL PATENT WORKSHARING
II. BETTER JAPANESE-BASED U.S. PATENT APPLICATIONS
III. GREATER HOURS PER AMERICAN PATENT "DISPOSAL"

IV. BETTER COUNSEL FOR AMERICANS

V. OPENING THE DOOR TO GLOBAL PATENT ATTORNEYS

VI. PROPOSED RULES CHANGES
This proposal in essence seeks to broaden the base of patent attorney and agents licensed to practice to those who fully meet the ethical and technical and legal requirements that are set in the current standards - but to eliminate any citizenship or residency requirements.

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DEPARTMENT OF COMMERCE
Patent and Trademark Office
Testimony of Harold C. Wegner

I. THE VISION Off' GLOBAL PATENT WORKSHARING

To understand the citizenship issue, one must first see the overall policy objectives of our government, and particularly the future of the PTO. As evidenced by the Under Secretary's leadership role in the American delegation to the Trilaterals in Tokyo in November 2003 while still the Deputy Under Secretary, there is a recognition at the highest level of the PTO of the great importance of the closest possible cooperation between the major patent offices of the world.

The patent examination world is bursting at the seams. Here at home in America, we see only a sliver of the global picture: The wine explosion that is taking place, here, is recurring all over the world as patent granting authorities are swamped with too many applications .for too few exanZiners. ):t should be
(v; apparent to everyone that it is ludicrous for examiners in five or ten or more
countries to examine virtually identical patent applications to the same invention -
each independently searching and each independently examining claims under
what are in effect very similar standards of patentable novelty - whether styled
abroad as an inventive step or here at home as obviousness. There is a virtual
harmonization of patent laws in terms of patent procurement that bas taken place
gradually over the years, with only a few rough edges yet to be droned out; the
same patent and literature data are searched throughout the world. (The well
known difference - a grace period versus flrst-to-file - is really a minor issue in
the overall scheme of examination as this difference is applicable only to a
minority of cases.) We thus already have achieved "fuzzy harmouizatiore" that
should permit one examiner to do the preliminary examination for all patent
granting authorities around the world.
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DEPARTMENT OF COMMERCE Patent and Trademark Office
Testimony of Harold C. Wegner
What keeps the already achieved fuzzy harmonization from being utilized to permit the common usage of search and examination results- There are two root causes that can be immediately identified. First, there needs to be a greater mutual understanding of the several systems by the examiners in each country, that can be best fostered through examiner exchanges - something that is outside the scope of the present testimony. But, it is also important that the patent allorneys who practice before the PTO have a broad multinational understanding of the similarities and differences between the several states. A truly multinational patent attorney is able to craft: simpler claims suitable for all countries and is able to understand and explain to the PTO why some results in a foreign proceeding should be used here at home. (Perhaps more important for American industry is the fact that such a truly multinational patent attorney will be able to start with a simple United States provisional application that is tailored to meet foreign standards as well as those of the U~uited States, so that there will be a meaningful priority right in foreign countries: It should be an important public policy objective for the United States that our emerging high technology industries are able to obtain Japanese, European and other foreign patent rights of value so that the cost of innovation here is spread around the world. This should be self-evident to everyone froze the American leadership role in the Uruguay Round of negotiations that led to the Trade Related Aspects of Intellectual Property -- the TRIPS.)

Macroscopically, then, it should be a policy objective of the PTO to educate American patent attorneys to become truly multinational patent attorneys to meet the needs of the shrinking global patent vision. Based upon the fact that literally hundreds - if not thousands - of Japanese have come to the United States for weeks or months or years to study in American law firms to gain a comparative mastery of U.S. practice, while virtually no Americans have been reciprocally

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DEPARTMENT OF COMMERCE
Patent and Trademark Office
Testimony of Harold C. Wegner
dispatched to Japan, the answer is not that the United States send patent attorneys
to Japan. (Certainly, we should and do send patent attorneys to Japan to represent
Japanese in American law issues; but, this is not the same as sending Americans
to Japan to learn about Japanese law and practice.) The answer to the question therefore must lie elsewhere. See § V, Opening the Door to Global Patent Attorneys, infra.

lx. BETTER JAPANESE-BASED U.S. PATENT APPLICATIONS

Nothing better speeds up the work of a patent examiner than a crisply prepared, clean patent application with sharp claims, an Information Disclosure Statement and everything formally in good order, Conversely, nothing slows things up more than a crudely translated and formally incomplete application. Optimizing the quality of the tens of thousands of foreign-based patent applications therefore will greatly improve the efficiency of the examination process. With 67,000 applications per year coming from Japan, a focus upon improving the quality of applications from that country is the obvious starting point.
Downstream, it is important that the United States focus upon all countries with significant filings in the PTO to have improved quality patent applications. Here, however, a focus is immediately made upon Japan because of the practical fact that Japanese applications in the United States overwhelm the filings of all other countries. Japanese domination of the world patent scene is manifested by the fact that rougbly half of all first filings of the world are in that country, whereas only about a fifth of first
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Patent and Trademark Office
Testimony of Harold C. Wegner

filings come from the United States. App., p_ 1.8_ The importance of Japanese Flings amongst the major patent granting authorities of the world is demonstrated by the flow of applications amongst the trilateral blocs (App., p. 19):

Japan to U.S. 67,000
U.S. to Janan 48,000
Japan to Europe 30,000
Europe to Japan 42,000
Europe to U.S. 73,000
U.S- to Europe 57,000

Thus, Japan accounts for nearly as many patent applications filed in the United States as all fifteen-plus European countries combined.

One of the major problems for the snore than sixty-five thousand patent applications filed by Japanese organizations in the United States is that they are often drafted by unlicensed translators or engineers and not even by a Japanese $enrishi ("patent attarney"): The proposed regulations make the false premise that the patent applications filed from abroad are through foreign patent law firms; this misses the boat entirely as to the thousands of cases where translation agencies are the "firm". While the eventual filing is conducted by an American patent attorney typically situated in metropolitan Washington, D.C., a great deal of the cases are ready-to-file applications from unlicensed translators wbo a fortiori cannot be expected to know the nuances of American patent law, let alone that of their home country.

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Patent and Trademark Office
Testimony of Harold C, Wegner

Anywhere from roughly 50,000 to more than 100,000 foreign-origin patent applications per year are filed in the United States which have been prepared by persons other than a foreign "lawyer" or "patent agent", even where the communication is through a "patent" office that may or may not have a "lawyer" or "patent agent" involved in overseas preparation of patent applications and may or may not (and generally does not) have the particular case prepared or transmitted by a "lawyer" or "patent agent". It is not seen how the proposed regulations that so microscopically deal with various interrelationships are to deal with the daily business of patent law on this not inconsequential scale. If one takes merely the 67,000 Japanese origin patent applications per year, one can begin to see the order or magnitude of the challenge. Trilateral Statistical Report 2002, § 3.3, Interbloc Activity, Graph 3.10, Flows ofApplications between Trilateral Blocs http://www.uspto.gov/web/tws/tsr2002/ch3/3 3.htm1. Multiply the individual issues for Japan by several score for the various quirks of other countries as well-

If we look merely to Japan as an example, one of the largest single offices in Japan to send patent applications to the United States was the translation bureau Nippon Gyatsu Boeki which started more than a generation ago with a mass direct filing of patent applications to the United States; it was essentially a translation office that previously had performed the translation work for the major Tokyo patent firms. In the mid-1970's, the organized benrishi association that polices unauthorized patent practice

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Testimony of Harold C, Wegner

had sought to define the overseas filings of patent applications such as from Nippon Gijutsu Boeki as the practice of Japanese patent law, but failed.

Today, as Americans and other foreigners had trouble with the tongue twister name, Nippon Gyutsu Boeki has been restyled as "NGB" to feed several of the largest Washington, D.C., patent law firms. It still proudly styles itself as more of a translation business that acts in lieu of a patent firm to send cases to theUnited States and other foreign countries.' Because the benrishi association was unsuccessful in the mid-1970's, the major Japanese translation and related foreign filing firms do not consider it necessary to engage patent agents or lawyers for such foreign work.3

In its treatment of its corporate history, the company does not even mention any existence as a law or patent firm; "NGB was founded as Nippon Gijutsu Boeki Co., Ltd. in Tokyo, Japan in November 1959 by Mr. Isamu Nishino. *** Because of his international business background, Mr. Yoshino recognized the potential importance of protecting Intellectual Property (IP) throughout the world and started Nippon Gijutsu Boeki Co., Ltd, to support Japanese companies in their understanding and protection of IP. At the time, Japanese manufacturing companies had not placed a high priority or focus on protecting their Intellectual Property." httn://www.njzb.c_o.in_/mizlish/c=Mv/outlinc.htnl. In speaking of its progress to the very present time, not one word is mentioned of any patent law licensure or expertise: "Since those early days, NGB continues to provide IP services to the world's most influential companies. Companies on the frontier of research and development in fields as diverse as electronics, semiconductors, automotive tecbnologies and pharmaceuticals. We are proud that most of the major Japanese companies choose to partner with NGB for IP services. Below is a summary of our history indicating our long commitment to providing the best IP services to our clients." Id.

2 Even today, NGB does not hold itself out as a law firm for.foreign (American) services. Instead, in its website under "prosecution", it states that "for forty years, NGB has provided prosecution support services to help our clients secure their Intellectual Property (IP) 'flights around the world. We have worked with our clients to
(V,,, secure tens of thousands of Patents, Design Models, Trademarks, and other IP
registrations. Because of our extensive experience, we have established close associations
with most of the leading law firms in the world, and we use this extensive network to

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Patent and Trademark Office
Testimony of Harold C. Wegner

in fact, the NGB work is cited as a paradigm not because of the quality of work but only as an example of the type of licensure problems that exist. To the contrary, NGB, while denying Japanese benrishi positions for its outbound work to the United States, in fact always has within its walls an American patent attorney to provide advice to its translators and other staff members. NGB is thus noted, here, only as a paradigm. It may be the largest organization of this type known to circles in Washington, D.C, but it is rather typical for the way work is sent to the United States from Japan -other than direct work from corporations which today does account for a substantial percentage of the 67,000 annual Japanese-based U.S. applications. Even amongst the f-ms which are populated by benpishi it is often the case that the person who is responsible for communications with the United States and for entrusting work to the American patent attorney is unlicensed. Ts such a person embraced within the framework of the proposed regulations or is this person outside the ambit of the proposed regulations- What impact does this have on the ability of the American lawyer to accept representation. Must the American patent attorney first confirm that the person who is sending the work is registered in Japan. as a bengoshi or a benrishi- What happens if the Japanese firm has a branch office in the United States arid the initial retainer is from the branch office in the United States or if communications are directed through this branch office-

ensure that our client's 1P rights are protected domestically as well as internationally." ft://www.ngb.co-il-/english/seiMce/`prosecution/. NGB does advertise that it has two subsidiaries - Japanese patent law firms - for its domestic Japanese patent practice. Id.

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DEPARTMENT OF COMMERCE
Patent and Trademark Office
Testimony of Harold C. Wegner

Even amongst the major "patent agent" or "patent offices" of Japan, there are often sister "K.K." organizations - the Kabushiki Kaisha - that often perform much of the work of sending outbound patent work to the United States; the Kabushiki Kaisha are corporate business organizations that are closely controlled by the patent law firms but which operate as legally independent entities and are neither law fu-ms nor patent agent firms.

Thus, the reality of practice in Japan is that it is not necessarily the norm that a licensed attorney or agent is sending the patent application work to the United States. It is just as likely that the patent application that is sent to the United States "ready to file" was prepared in a Tokyo translation bureau based upon one ox several Japanese priority filings which have been cobbled together by the translation bureau or other staff member.

Even if one adapts the rules to fit the realities of the NGB-type of operations that exist, and assuming that there were no further problems for Japan, this is just the tip of the global patent iceberg: Of residents of the more than 100 odd countries that ale patent applications in the United States, a country by country examination is needed to understand precisely what happens in each country, manifesting the fact that one size does not fit all situations.

A complex answer- to the puzzle of better quality foreign-based patent applications is to (a) tighten up regulations on practice; and (b) encourage

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Patent and Trademark Office
Testimony of Harold C. Wegner

foreign applicants to directly utilize patent attorneys who are licensed to practice in the United States. This cannot and will not happen overnight, no matter what regulations are proposed. The utter reality of the situation is that the filing habits for tens of thousands of patent applications per year must be changed incrementally. A first step that can be taken is to increase the number of the truly multinational patent attorneys who reside in Japan and other foreign countries. To add a truly multinational patent attorney will require opening the door to registration of Japanese nationals who meet the requirements of the United States for registration other than citizenship. See § V, Opening the ,Door to Global Patent Attorneys, infra.

III. GREATER HOURS PER AMERICAN PATENT "DISPOSAL"

Ultimate implementation of true "patent worksharing" will involve one Examiner doing the work for his or her colleagues around the world on each application. As a practical matter, Americans will benefit most of all by having an American Examiner handle the initial patent examination for the world offices. This will greatly simplify matters for American industry by being able to deal with "everything" in Crystal City - or soon, Alexandria - instead of in Tokyo, Munich, Beijing and elsewhere,

More important as a benefit to Arnericails in their home country procedures is the fact that if the several tens of thousands of foreign applications that the American examiners must handle today are shifted to

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Patent and Trademark Office
Testimony of Harold C. Wegner
Tokyo, Munich, Beijing and elsewhere, this will give the American examiner more time to focus on the applications of American industry.

Again, patent worksharing will only be achieved if there is a better mutual understanding of the workings of all the offices, particularly with an increase in the number of truly multinational patent attorneys. See § V, Opening the Door to Global Patent Attorneys, infra.

IV. BETTER COUNSEL FOR AMERICANS

One of the major problems that face .American emerging technologies is that they must compete for the best patent counsel not only with major American industry but also the large foreign organizations that gain patents in this country. It is too well known to repeat that over the past generation some of the leaders in domestic patent filings have been the major Japanese electronics acid mechanical companies. They have become highly sophisticated in American patent matters and compete neck and neck with large .American companies for the best and brightest American patent attorneys. One of the leading Never York patent "boutiques" and the largest Washington, D.C. pure patent firm - each of which styles itself as a litigation firm - in fact both have a very large Japanese procurement practice.
If there were truly multinational patent attorneys residing in Tokyo then, over time, a sipi.ficant shift would be made in this filing work to

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Testimony of Harold C. Wegner

Tokyo-based counsel. In this way, the talent that: should be made available to American emerging technologies can be freed up.

Y. OPENING THE DOOR TO GLOBAL PATENT ATTORNEYS

The answer to gaining more truly multinational patent attorneys is quite simple: The citizenship requirements of the regulations 'for registration as a patent attorney or agent should be stricken. If this is done, then immediately there will be a flow of new patent attorneys and agents licensed to practice from all over the world.
Hundreds of foreign'attorneys annually come to the United States to gain the LL.M. degree, and each is then granted a one year visa to work in the United States, often in American law firms. Additionally, there are scores of patent practitioners from Japan alone who come to study in the United States.

The record of the United States PTO is comparable to that of the Louisiana Supreme Court in its xenophobia toward "foreigners" practicing in the United States. App., p. 11 n. 6. Only grudgingly and under the most restrictive interpretation of case law have foreigners been admitted to practice before the PTO. A petition to continue to practice as a patent attorney was denied to a member of the Ohio bar and later Vice-President of the Cincinnati-based Proctor & Gamble; one of the Max Planck Institute's most distinguished comparative scholars who was long a resident of Oklahoma and later a senior partner in one of the most prestigious Munich 13
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Patent and Trademark Office
Testimony of Harold C. Wegner

lair firms was denied the opportunity to be a patent attorney if he moved to Munich - to represent an American company in that city. The "crime" on which patent attorney registration was denied was that the two were respectively Dutch and German nationals. App., at 1213.

The citizenship distinction is lost on practice at other agencies where any member of the highest court of any state - including numerous foreign nationals - are pennitted to practice: The extraordinary exclusion from the Administrative Procedure Act Granted to the PTO to set its own regulations is to deal with issues of character and qualifications and not to discriminate against foreign nationals who are otherwise qualified.

At first blush, one may think that having patent attorneys only in the United States has some rational basis because there is better local control by the PTO and other reasons. But, these reasons are shattered by two points.

First, an American citizen is fully licensed as a patent attorney without regard to residency. Second, literally hundreds of Canadians are registered under a loophole in the American regulations based upon ostensible but false reciprocity. (An American cannot be licensed to practice directly in Canada; he must nominate a local patent agent.) The historic treatment of Canadians should serve as a global model for the United States. Canadian patent attorneys and agents have been scandal-free in their American practice and bave well served their Canadian clients at the PTO. Indeed, their dual

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Patent and Trademark Office
Testimony of Harold C. Wegner

registration makes them much more a part of the U.S. system, they are truly prime models for the truly multinational patent attorney,

vi. PROPOSED RULES CHANGES

It is therefore the suggestion that the proposed rules be modified to strip away all citizenship requirements and any discrimination against a prospective patent attorney or agent to be registered - or for an existing patent attorney or agent to maintain his or her registration. This would square with the practice under the Administrative Procedure Act and help further the overall objectives of the PTO in its leadership role in the shrinking global patent village.
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Patent and Trademark Office
Appendix to Testimony of Harold C. Wegner

PTO RECERTIFICATION; PRACTIONIN6 THE PATENT BAR

Harold C. Wegner"

X. OVERVIEW

Changes to Representation' is a currently proposed U. S. Patent and Trademark Office (PTO) set of rules. The set will, if ~implerraented, signal a sea change iii the long quiescent and arcane world of patent attorney and agent licensurc. It is a wakeup call for immediate reconsideration of the federal licensure exception to the now more than fifty year old Administrative Procedure Act. If the bar instead sleeps, an irreversible diminishment of the status of "patent attorney" will inevitably occur-

Domestically and internationally, the American patent community has become an isolated stepchild of the overall legal society. Domestically, even in technology areas, the "patent attorney" licensure isolates the patent prosecutor from the upper end of the profession: The total number of licensed patent attorneys totals only about one-fifth the number of lawyers in just the top 250 frrns. This is the rariFed air with virtually all the upper end opinion makers and movers and shakers on Capitol Hill who influence the appointments of the federal judiciary and the PTO and can make legislation "happen" - including full funding of the PTO. One need only survey the twenty largest firms to see that less than two (2) percent are patent attorneys licensed by the PTO - and of that ntunber, probably none or very few have anything other than an upper end practice mutually exclusive from the

'"Paper prepared for a Public Forum, Bar Association of the District of Columbia P'fC Section, January 21, 2004, Washington, D.C.

** Past Chair, Bar Association of the District of Columbia PTC Section; former
Director of the Intellectual Property Law Program and Professor of Law, George Washington University Law School- Partner, Foley & Lardner. hweanerC~folcy.com.

' Changes to Representation of Others Before the United States Patent and Trademark Office, 6$ Fed. Reg. 69442 (.December 12, 2003) (herein: Changes to Representation).

App., p 1
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Appendix to Testimony of Harold C. Wegner

preparation of patent applications. Thin, too - and perhaps to an even greater extent - are the ranks of. the registered patent attorney bar in the corporate board rooms. If the Administrative Procedure Act were now amended to admit any attorney eligible for other agency practice to participate in the patent bar - with the elimination of the registration number practice, then the ranks of "patent attorneys" would swell. Patent attorneys would suddenly assume a much larger and more visible role, including those who do mergers and acquisitions keyed to intellectual property, global business deals, opinions on due diligence involved with patent infringement arid just plain patent litigators.

Globally, a PTO xenophobic policy against non-citizen registration has dearly cost the United States a leadership core of bicultural attorneys who are at the top of the global patent world; indeed, one has to look to the Louisiana Supreme Court and its recently struck down exclusion of all but "immigrant aliens" to its bar to find a comparable level of xenophobia within our shores. Xenophobia has been at great cost to the United States. It has deprived the American patent community of the rich diversity of top patent lawyers who would join our bar. It has excluded a future VicePresidmt of an American-based multinational who is a member of an American bar and was a registered patent attorney only 1 he committed the "sin" of moving to Europe; while residing in Oklahoma, one of the eve or six of the very top patent scholars from the early 1970's at Max Planck Institute - now a senior name partner in one of Munich's most highly regarded law firms - was flatly denied the possibility to head his corporate organization's European operation if lie moved back to Munich as part of that American corporate organization- Dozens if not scores of Japanese patent practitioners would by now be registered as American patent attorneys or agents, but for the restrictive "Louisiana level" PTO practice. If the United States, today, were to admit lawyers to practice at the PTO who are qualified under the Administrative Procedure Act, we could inunediately reverse the trend and suddenly have scores if not several hundred lawyers who are foreign nationals and residents of foreign countries who have patent experience who could be a part of the mainstream American patent bar through their licensure in New York or other state bar.

But, if the current rules are implemented, the picture is very bleak, both domestically and internationally: Domestically, the patent bar will be

App, n 2
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Appendix to Testimony of Harold C. Wegner

further marginalized and would immediately sink. to a figure of registered patent attorneys somewhere between 1.5,000 and 19,000 - once the elimination of the many patent attorneys who only occasionally practice at the PTO are eliminated. In the very near term, this may be just great for patent procurement specialists who do nothing but prosecute patent applications for a living; their average fees will surely rise dramatically as the options for prosecution dwindle down to those who elect to be recertified on an up to annual basis. Yet, if the United States takes this course and particularly if it maintains its Louisiana-level xenophobia against foreign lawyers, the marginalization of the patent community and its influence in the real world of commerce will be diminished beyond the meager level at which it stands today.

This paper commences with a story about numbers. See § II, A Future Practice without Arbitrary Rules. In looking at the state of. patent attorney and agent licensure, one may step back and see an arbitrary set of rules with extreme paradoxes that have led to an artificially small patent bar of about 22,000 - roughly one fifth of the number of attorneys in just the 250 largest law firms; of the 30,000 plus lawyers in the twenty largest law firms, less than two (2) percent are now registered as patent attorneys and most of them only marginally practice at the PTO. Much if not most of this is traced to a set of arbxtrary rUles :for. regisiration which have no defensible pattern - other than to keep qualified persons from registration who are not former PTO employees and to automatically register those who want to retire from the PTO including some categories of. PTO officials who would not be considered qualified to sit for the patent bar examination. There are several examples:

On the one hand the rules make it next to impossible for some very
highly qualified patent lawyers of immense success in patent litigation,
opinions and counseling to even sit for the patent attorney examination while
others who may be counseling technically unqualified but who help write
PTO guidelines may be automatically registered without even taking a test.
Or, an American expatriate living in Korea or Columbia or the Czech
Republic at age 21 with only an undergraduate science degree who has no
training at all in patent law but was able to cram and pass the multiple choice
patent examination and be registered as an agent may be fully registered and
remain so while living in Korea or Columbia or the Czech Republic, while a

App., p 3
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Appendix to Testimony of Harold C. Wegner

Japanese bengoshi and benrishi - the respective "law" and "patent agent" registrations of Japan - who is also licensed in New York and is registered to practice before the PTO is stripped of his American patent attorney registration if he moves back to Japan.

While highly trained patent litigators and other lawyers are viewed as "unqualified" by the PTO and foreigners are excluded on the basis of citizenship and residency, patent examiners now numbering many thousands have been licensed to practice over the past thirty some years with no examination at all for the many key facets of patent practice; some have been design examiners who have no technical degree whatsoever but years of PTO experience, solve including at the Board of Patent Appeals and Interferences.

Additionally, the PTO perpetuates a myth that a patent agent is ``usually just as well qualified as patent attorneys" to write and prosecute patent applications. This fallacy is against all evidence. (A patent agent
L,.~ cannot even fill in an assignment form or do arty legal work other than drafting and prosecuting a patent application - or other licensed work). At the same time, a patent attorney also has no broader scope of federal licensute outside his state of licensure. A movement toward a broader scope of licensure but focused upon patent attorney practice seems inevitable, but the sooner this takes place the better. See § XTI, Toward a Unified Federal Patent Bar.

The PTO statutory exemption from the APA was created to give the PTO the authority to test "to slow that [the candidate is] possessed of the necessary [technical] qualifications ***" (gild check moral and ethical qualifications). The PTO has eliminated its historic testing procedure that had required prospective attorneys to draft claims or perform other tasks to show their qualifications and replaced this with a memory bank of multiple choice questions - far from its statutory role. See SS r~! The PTO Statutory Testing Duty.

The idea of an agency annual fee and recertification is flawed for two entirely different reasons. First, from a substantive standpoint it would
(,„~; further fraction the patent profession into an ever. diminishing group of prosecutors versus the larger general bar that would grab an every increasing

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share of the patent pie. More fundamentally, however, there is absolutely no statutory basis either for art annual fee or for recertification for practice at the PTO - something entirely outside the statutory authority of this already unique agency. See § V, An Agency Annual Fee and Recertification.

Whether the new rules will be adopted, modified or reconsidered with further debates within the profession, will in large measure depend upon the reaction of the public and the ultimate decision of the General Counsel of the PTO who has supervision over the Office of Enrollment and Discipline as well its new Under Secretary of Commerce who has assumed responsibility for the PTO subsequent to the publication of the proposed rules,

II. A FUTURE PRACTICE WITHOUT ARBITRARY RULES

The patent profession should be moved to the mainstream of a lawyer practice without any special regulations for admission to practice other than for any other federal agency. If this is done, then immediately the overall patent bar would double or triple in size to encompass a wide range of patent experts who today practice upper end patent law at the major law firms in this county bat do not do patent procurement; such a move would also immediately globalize the profession in a dramatic movement in view of the large number of patent attorneys who are foreign nationals and members of the New York or other state bar. The growth of the domestic patent voice is considered in § A while the globalization is considered in § B.

A prime reason for the continued narrow practice is the historic selfinterest of the PTO senior career staff to maintain the golden parachutes for retiring and other former patent examiners and PTO officials; as pointed out in § C, some entire categories of officials would not be qualified based upon their technical training and experience but for loophole regulations while many patent examiners are given a free registration without examination even though they have no training to draft claims to create enforceable patents or otherwise understand from practical experience the post-patenting consequences of patent prosecution necessary for creation of patents that are enforceable and which will be found valid in an infringement action.

A. Growing - Not Shrinking - the Domestic Patent Voice

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The proper vision of a future patent bar should be one that is inclusive of. the many patent attorneys at the upper end firms who practice patent litigation and counseling at a level that brings them into daily contact with domestic and world leaders and which would permit their influence with Capitol Hill and the White House to obtain better patent legislation -including PTO funding - and create a better pool and support for such a pool for appointments to the Federal Circuit and the upper end positions of the PTO. If the door were opened to the 15,000 or so truly upper end patent practitioners wbo are not registered, this would be a great enrichment and cross-pollination of ideas and concepts at the PTO that would bring the PTO more into the mainstream of the general bar.

The situation at present is at best bleak for the patent profession in terms of the "registered" bar- The ranks of. the 22,000 registered patent attorneys2 is dwarfed five-fold by the more than 100,000 lawyers in just the top 250 law firms alone. 3 Implementation of the current regulations would surely shrink the number to somewhere between about 15,000 to 19,000. In contrast, the total number of attorneys at just the top twenty law firms of the world, alone, accounts for more than 30,000: This will mean that the total number of attorneys at just the two twenty law firms of the world will have on the order of twit°e as many lawyers as the total number of registered patent attorneys. (To further complicate the picture, at least before Enron,

zThe PTO pegs the figure at 22,045. See Charges to Representation, 68 Fed. Reg.
at 69442("jN]early 28,000 individuals are registered as patent attorneys and agents, of
whom about 80°/u have indicated that they are attorneys"). This figure is used throughout
this paper. But, according to the website at the PTO 'For agents and attorneys, it is stated
that "fit]his Index contains contact information for attorneys and agents with licenses to
practice before the US Patent and Trademark Office. There are 6787 active agents and
22045 active attorneys."
http - ://www.nspto.gw/web/oftices/dcom/oiia/oed/roster/index.html [Data extracted
December 24, 2003]

3 Delivery of International Legal Services in the Coming Decade, 15-AUT Int'1 L.
PraCtlclUZ1 67, 89 (2002)(citang the National Law Journal)("The number of lawyers in the
top-twenty law firms is increasing substantially- [TJhe total number of lawyers in the top
250 firms has increased very dramatically from twenty-three thousand in 1980 to over
one hundred thousand today.")

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the top five accounting firms had more lawyers than. the five biggest law firms. 4)

Within the sphere of the 30,000 lawyers at the top twenty firms, the percentage of patent attorneys who retain their registration will surely drop to a number at or just above one (1) percent of this number, and surely will be a bit below two (2) percent: It is no wonder that when the patent voices speak on Capitol Hill or the White House -whether to urge the appointment of a candidate for leader of the PTO or a position on the Federal Circuit or for full funding of the PTO - it seems that there is nobody listening: 'there is no powerful voice to be beard. ,Diminishment of the meager voice that does exist moves precisely in the opposite direction from what the patent system needs.

The leadership of the patent bar over the years has crossed the line to meld into the general legal scene and considers itself more of an "intellectual property" subset of the general bar and not a "patent prosecutor" in the traditional sense of the patent attorney and agent world. This has very serious negative consequence for the patent community at large whether it is in the status and reputation of and appointments to the Federal Circuit or the PTO itself. or it is in the matter of patent legislation including funding of the agency. By calving off the top end of the patent bar from the "patent prosecutor" world, there are few spokespersons for "patents" at large. The occasional Armitage who rises to the position of Senior Vice President and General Counsel of a major Ameilcan corporation and retains active membership in the "regular" patent corruxtunity is the rarest of exceptions: Virtually none of the very top corporate executives who may even retain a "patent attorney" registration choose to primarily

4 John E. Sexton, "Out of the Box" .Thinking about. the Training ofLawyers in the NexrMillennium, 33 U. Tol. L. Rev. 189, 191-92 (2001)( ("The total number of lawyers at the Big Five accounting finns now dwarfs the number of attorneys at the five largest law firms in the world. For example, Arthur Andersen has employed more than 3,600 attorneys, 2,$00 practicing law outside the United States and another 750 lava school graduates in the United States working ire tax and corporate finance. Moreover, the legal staffs of the Big Five are expanding about 30% a year. One accounting firm suggests it will more than triple its legal professional staff in the next five years with a goal of over $1 billion in business by that year.")

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identify themselves with patents. In the world of private practice the diminishment of the "patent attorney" is far more precipitous than one on the outside would imagine. Except for the junior-most associate level, there is an almost total absence of any regular patent attorney practice as known at the PTO amongst any of the attorneys in the very top law firms of the United States.

Whereas every other major segment of the bar is heavily represented in the decision-making bodies on the Hill by lawyers from amongst the very elite firms, the paucity of leadership in the patent community is most striking. N'othing better illustrates the gross divide than in the megafirms where patent attorneys barely continue to exist and those that practice only occasional for the very important case or an extraordinary reason.

Patent practice at the megafirms has never been better. Huge, thriving intellectual property practices with more than 100 lawyers partaking in ever more lucrative patent litigation and dealmaking has created an economic thirst to absorb patent boutiques at an ever accelerating scale. The former "boutiques" with over more than 100 patent attorneys can hardly be considered a boutique in the sense of a generation ago when twenty to thirty or so patent attorneys were considered large tirna.s. While there are perhaps three to six or so firms on the East Coast and several and in the rest of the country that have bulked up and are likely to continue to survive, at the same tune carcasses lie on the pavement including Pennie & Edmonds and Lyon & Lyon while others like Arnold, White & Durkee have merged into megafirms. While the trend toward patent practice at the megafirms has accelerated, at the same time it has become an almost totally upper end practice that totally or largely excludes anyone in the megafirrns other than the lowest associate from doing more than a small percentage of their time on patent prosecution matters. At 11 of the 20 top revenue producing firms of the world, the average revenue produced per attorney topped $ 600,000_00; for all of the top twenty firms, the minimum average for any of the top twenty was over $ 400,000 per year. Clearly, nobody in a firm of this type much above an entry level associate carp handle a majority of patent procurement work, even for the registered patent attorneys. But, if one looks at all of the more than 30,000 lawyers in the top twenty firms less than two
,- (2) percent are even registered patent attorneys.

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Since virtually none of the even small number of registered patent attorneys at the top twenty firms has more than a minority of patent practice at the PTO, this means that a substantial number of the registered patent attorneys will simply drop from the rolls of the registered patent attorneys. For the fifteen out of twenty of these firms where the number of registered patent attorneys numbers from zero to two percent at most, a patent attorney credential is certainly not a treasured credential to carry amongst ones peers. It will also be interesting to see precisely what percent of the upper end corporate executives who have lovingly retained their patent attorney registration numbers from their days decades earlier at the start of their careers who will simply abandon their registration numbers instead of the going through the nuisance of taking a computer self-test on the filing fees for claims and other mundane matters that no longer impact their daily lives.

B. Furthering Global American Patent Leadership

The shrinking global village is a reality in the real world of legal services at the upper end of business law and practice. The President of Now York University - then the Dean of the New York University Law School - puts the dual factors of globalization and specialization in context: "The trends toward a more specialized bar and toward the consolidation of multiple professional services in single entities nay be attributable, at least in part, to the same underlying cause: the desire of both sophisticated and unsophisticated consumers of legal services (and of other professional services, for that matter) to obtain maximum service and efficiency."5

5 John E. Sexton, "Out of the Box" Thinking about the Training of La wyers in the
Next Millennium, 33 U. Tol. L. Rev. 189,191-92 (2001). Additionally, the president
states that "[s]ometimes, a specialist will deliver the economy - and this could be true
whether the transaction is complex or routine. Other times, either because the client
requires a blend of professional advice, or because a consolidated provider can reduce the
costs of identifying and monitoring the appropriate specialist, a provider of multiple
professional services will deliver the economy; again, this could be true for both the high
end and the low-end client.

"If, in fact, specialization and professional consolidation are driven by client demand, their growth will be accelerated in a globalized economy. The bar outside the United States already is more comfortable with both trends than is the American bar; and *** it is hard to imagine the American bar maintaining the status quo in. the face of significant business migration to other lands."

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American and British law firms have taken a global leadership role in this globalization, but a vacuum has been created in the patent field here at home as far too few lawyers knowledgeable about patents in plural countries practice in the field. Whereas every other field of federal law has been blessed with numerous.foreign lawyers who are members of the New York or other state bar are able to practice in the United States - whether here or in their home country - the PTO has arbitrarily excluded even the most qualified foreign lawyers from practice unless they change their citizenship or obtain the proper visa to suit the PTO and maintain residency in the United States. An immediate end to this xenophobia is necessary i f the United States is to play the same global leadership role in patents that it has assumed in all other areas of business law.

1. The Need for Global Experts at Home

If the United States were to admit all lawyers who are members of a state bar as is the case under the APA for all other agencies than the PTO, immediately several hundred lawyers who are Asian or European would be eligible to practice at the PTO and who have some familiarity with patents, as well as some very highly regarded international patent experts who could immediately be a part of the patent bar and provide an international understanding and leadership. If the registration test had been open to foreigners for the past generation, there would undoubtedly be at least 200 Japanese, alone, who would be registered by this time.

The liberalization of the practice of lava to foreign lawyers that has exploded in the more than thirty years since the Griffiths case has gone so far as to lead to the intervention of federal courts in state licensure practice that have sought even less restrictive practices than the PTO. This is manifested by the Wallace case 6 where a federal court has struck down the rules of the Louisiana Supreme Court that had barred a recent graduate of the state's preeminent law school, Tulane University, from taking the state bar because that person was not an "immigrant" with the "correct" visa status.' In the Wallace case, two plaintiff alien aspirants to take the

G Wallace v. Calogem, 286 F.Supp.2d 748 (E.D. La. 2003).

' 7 A foreigner who has a student visa to taste the LL.M. course is then given a one
year period to accept employment in law firms before returning to their home country-

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Louisiana bar examination were not permanent residents of Louisiana; they were denied permission to sit for the state bar examination. In voiding the Louisiana Supreme Court rule that permitted only citizens and "immigrant aliens" to take the bar examination, the federal court cited with approval policy reasons to admit the alien petitioners in the case: "Like immigrant aliens, noninnnigrant aliens `pay taxes, support the economy, serve in the Armed Forces, and contribute in myriad other ways to our society.' [In re Griffiths, 413 U.S. 717, 722 (1973)]. This Court finds that Griffiths is controlling and, thus, strict scrutiny is applicable. Nonimmigrant resident aliens as a class are a `prime example of a discrete and insular' minority for whom such heightened judicial solicitude is appropriate.' Id. (citing [U.S. v.] Carolene Products [Co]., 304 U.S. [144,] 1.52-53 n. 4 [(1938)]). Therefore, similar to Grijfzths, the Defendants bear a heavy burden when they deprive nonimmigrant resident aliens the opportunity to be admitted to the Louisiana bar."$

It is ironic that the internationally focused PTO where the Director
i travels routinely to trilateral meetings in Japan and elsewhere to foster
international cooperation is undercut by the lower level OED and its rules
that proscribe even the best and brightest foreign lawyers who are members
of state bars and who have been patent attorneys fully registered to practice
at the PTO are stripped of their PTO registration numbers when they have
the temerity to leave this country.

There are numerous examples of some of the leaders of the patent bar who have been denied registration at the PTO because of an arbitrary application of citizenship or residency requirements. Various distinguished international experts who have become successful members of a state bar in the United States have been granted registration as patent attorneys but are stripped of this recognition if they leave the United States or otherwise have a visa status other than one on the approved list of the PTO.

$ Wallace, 286 F.Supp.2d at 763. It is recognized that there are different standards for judging the action of a state versus that of the Federal government. However, the same underlying policy rationale should apply with equal force-

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Jacobus Rasser, a member of the Ohio bar and a registered patent attorney who later became Vice-President and the top patent attorney for the worldwide Cincinnati-based Proctor & Gamble was stripped of his patent attorney registration simply because he left the United States to return to Europe.y Dr. Bernhard Geissler, a renowned patent scholar at the Max Planck Institute in Munich before coming to America and a leading attorney at law for Phillips Petroleum was permitted to be a patent attorney but with the proviso that when he returned home to Germany he would be stripped of that qualification; he later did and then became a senior name partner in what is now the Municb-based Bardehle Pagenberg firm. '° Eiji Katayarna is one of Japan's most renowned bengoshi and benrirhi and a member of the New York bar and also an electrical engineering graduate of the highly respected Kyoto University; his command of the nuances of patent law on a global basis would make him a natural to enrich American practice - but he at least had the good common sense when he was at New York University Law School in its LL.M. program not to even consider filing a petition in the wake of the Geissler and 12asser decisions. What a loss for the American patent system. An Israeli national who passed the examination was denied registration on the basis that she is an alien; a petition to register was granted because she was a permanent resident, but with the proviso that "[i]f [she] ceases to reside in the United States, the Committee on Enrollment is *** directed to remove [her] name from the register of agents."" A French employee of SchlUmberger was admitted to practice in the United States but was notified that he would be stripped of, leis registration if he moved back to France. 12

9 In re Rasser, 1985 WL 71975, 228 U.S.P.Q. 607 (Com'r Pat. & Trademarks 1985).

1°In re Geissler, 1974 WL 19945, 182 U.S.P.Q. 499 (Corn'r Pat. & Trademarks 1974).

1 1 In re Yokoyama, 1.976 WL 20865, 194 U.S.P.Q. 110 (PTO Con * PTO 1976)

'Zln re Gressei, 1976 WL 21210, 189 U.S.P.Q. 350 (PTO Com'r Pat. 1976)("[P]etitioner is lawfully, albeit temporarily, in this country to render services to his employer. Accordingly, inasmuch as petitioner bas demonstrated that he is `possessed of the legal and scientific and technical qualifications necessary to enable him to render applicants for patents valuable service,' *** petitioner is hereby granted limited recognition *** to prosecute *** any patent application in which the owner of record ***

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There is nothing at all subtle about the PTO's plan to discriminate against aliens, to bar them from registration before the PTO. Indeed, ever since 1984, while other jurisdictions have liberalized the admittance of foreigners to bars, the PTO has sought to further exclude foreigners whenever possible. Thus, going back twenty years ago to the tine the PTO started the trend of restriction of foreigners as patent attorneys or agents, it recognized that it could admit non-citizens; but, it stated in 1984 that "[t]here is no known legal requirement or other public policy which compels or makes desirable the registration or continued registration of non-citizens residing in a foreign country". 1 3

The rules themselves focus upon the exalted status of U.S. citizenship - to the point of welcoming citizens to practice even if. they reside in Japan or elsewhere. 14 But, unless one is a Canadian and can freely enter American practice with no qualifications under U.S. law, an alien may only be registered "[w]hen appropriate"15 and only if he or she "lawfully resides in the United States". 16 Furthermore, even if "lawfully resid[ing] in the United States", the proposed rule states that "such registration [must not be] inconsistent with the terms upon which the alien was admitted to, and resides in, the United States.]" 1'

is Scblumberger, Inc. The limited recognition will remain in effect during the period *** that petitioner's [ ] visa remains valid and petitioner remains in the United States.")

is Practice Before the Patent and Trademark Qface (notice of proposed rulemaking), 49 FR 33790, 33793 (1984)("One comment suggested that § 10.6 should be changed to permit a non-citizen registered under paragraph (a) to remain registered even if the non-citizen ceases to reside in the United States. The suggestion is not being adopted. *** There is no known legal requirement or other public policy which compels or makes desirable the registration or continued registration of non-citizens residing in a foreign country other than under the conditions specified in [the] proposed [rules]."). 14 Changes to Representation, 68 Fed. Reg. at 69517; proposed 37 CFR § 11.6(a), Registration of attorneys and agents. ("Any citizen of the United States who is as attorney and who fulfills the requirements of this Part may be registered as a patent attorney to practice before the Office.") 151d.

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Even if a foreign national has already been registered and may be a member of a state bar, he can be eliminated from the rolls if he moves away. Thus, he is removed from the register of attorneys unless "the alien continues to lawfully reside in the United States and registration does not become inconsistent with the terms upon which the alien continues to lawfully reside in the United States[,]"" Parallel rules of exclusion are provided for patent agents. 19

The commentary accompanying the proposed rules states that "[c]itizens of the United States could be registered regardless of their residence. The OED Director could register resident aliens, under appropriate circumstances."2° The explanation of the proposed rules makes it clear that "appropriate circumstances" would be cut right to the bone to as conservative a view as possible with the aim of excluding foreigners from practice before the PTO. Thus, "[t]he proposed riles would reshict circumstances under which an alien could be registered. Registration would be precluded if the practice of patent law before the Office is inconsistent with the terms of any visa under which the alien is admitted to and continues to reside in the United States. Registration would be precluded, for example, when the visa petition does trot describe that the alien as being authorized to be employed in the capacity of representing patent applicants before the Office. See In re Richardson, 203 USPQ 959 (Comm'r Pat. 1979) (alien admitted to U.S. with H-3 visa for training could not practice patent law under terms of the visa), and In re Mikhail, 202 USPQ 71 (Comn'r Pat. 1976) (alien admitted to U.S. on B-1/B-2 visa and visiting the U.S. temporarily for business or pleasure could not practice under the terms of the visa). It is nevertheless appropriate for some aliens to be granted limited recognition under § 11.9. See In re Messulam, 185 USPQ 438 (Comm'r Pat.

'7 jd.

's Changes to Representation, 68 fed. Reg. at 69517; proposed 37 CFR 11.6(a); or, an exception is provided for reciprocity, as discussed infra.

19Id.; proposed 37 CFR § 11.6(b).

20 Changes to Representation, 68 Fed. Peg. at 69446; emphasis added.

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1975) (granting lin-iited recognition to alien admitted to U.S. on L-1 visa for purpose of rendering service to a single company for whom the alien had previously worked abroad and who would remain in the U.S. temporarily). See also In re Gresset, 189 USPQ 350 (Comm'r Pat. 1976)."''

In other words, the PTO would grudgingly register aliens who are residents of the United States on a par similar to the "immigrant" status of the Louisiana Supreme Court - thrown out in the Wallace case.

Enlightened jurisdictions exemplified by New York have globalized the profession, both in terms of welcoming foreign-trained law students into the ranks of full state bar membership and also - as in the case of Massachusetts - by permitting otherwise domestically unlicensed foreign lawyers to be registered as consultants who can join local state partnerships; yet, the patent bar licensure standards stick to a common denominator "Louisiana" level of xenophobia that seeks to exclude foreigners to the limits permitted by the federal courts.

Z. Canadians "Yes" - Japanese "No"

The discrimination is not universal. Thus, for example, Canadians are routinely registered without an examination but merely based upon their home country national registration.22 This special treatment four Canadians is clearly positive for the United States in that it permits ,American patent applications for Canadian nationals to be written by Canadian patent agents who would draft the applications even if'they were not registered in the

2 1 Changes to Representation, 68 Fed. Reg. at 69446; emphasis added.

22 Changes to Representation, 68 Fed. Reg. at 69518; proposed 37 CPR § 11.6(c), Foreigners ("Any foreigner not a resident of the United States who shall file proof to the satisfaction of the OED Director that he or she is registered and in good standing before the patent office of the country in which he or she resides and practices, and who is possessed of the qualifications stated in § 71.7, may he registered as a patent agent to practice before the Office for the limited purpose of presenting and prosecuting patent applications of applicants located in such country, provided that the patent oftee ofsueh country allows substantially reciprocal privileges to those adanitted to practice before the
,, Office. Registration as a patent agent under this paragraph shall continue only during the period that the conditions specified in this paragraph obtain.").

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United States, but, because they are registered, fall under the Axnefcan disciplinary rules and presumably are better in tune with American regulations and practice. The practice clearly shows that some foreigners are welcome to practice in the United States - even without a United States examination, permitting their entry easier than for some Americans who must take their own country's examination to be registered to practice.

The discriminatory treatment favoring Canadian agents has been accepted even by the courts in an earlier era. For example, an American practitioner unsuccessfully challenged the Commissioner of Patents on the policy of registering Canadian agents in the Cantor case. 23

The United States abdicates the possibility of better control over the literally hundreds of thousands of Amencatl patent applications that have been filed by Japanese companies in the United States over the past generation. As in the case of Canadian origin applications, Japanese applications are drafted in the first instance by Japanese in their home country. There is nothing unique about this universal practice: The traditional practice is that the "home country" patent practitioner drafts the original application as a priority basis for global filing. 24 If the United States were to admit the best and brightest Japanese - or other nationals - to the U.S. patent attorney or agent practice, then instead of having almost all drafts of patent applications prepared by an unregistered attorney, the reputation that would be gained in Japan - and elsewhere - for skill in the United States practice would lead to Japanese registered to practice gaining a greater share of their home country patent application. work. In turn, the United States PTO would benefit by having registered patent attorneys or agents draft the applications, persons under greater influence from the PTO to keep up with regulations and abide by U.S. standards of practice.

23 Cantor v. Parker, 1979 WL 25098, 205 U.S.p.Q. 584 (E.A.Va. 1979)(Bryan, J.). However, the case was dismissed on procedural grounds because of inadequacies of the plaintiffs pleading, and none of the issues of discrimination mentioned here were addressed.

24U»der the Paris Convention, a filing in the United States - or any union state -r is dated back to the "home country" fling date if certain formalities are met and the home country application substantively meets the requirements of the United States. There is a one year deadline to file under the Paris Convention.

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While the same case could be made for German or French or other foreign practitioners, the practical impact of the Japanese practitioners dwarfs that of all other foreign countries:
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World Total 702,000
DEPARTMENT Oh COMMERCE
Patent and Trademark Office
Appendix to Testimony of Harold C. Wegner
FIRST FILINGS BY COUNTRY OR REGION (1997; 2001)2-5
local frsi filings and world percentage
1997 2001
Japan 349,000 50 % 383,000 45
U.S. 119,000 17 175,000 21
EPC States 107,000 15
122,000 14
"Other" 127,000 18 170,000 20
849,000
2$ Statistics are based upon the Trilateral Statistical Report 2002, § 3.2, Parent Filings by Blocs, Graph 3.3, First Filings by Regions littp://www.uspto.gov/web/tws/-t--sr2OO2/ch3/3 2.htm1. The official commentary states that "(first filings have been increasing steadily. Although the rate of increase reached 10.1% from 1999 to 2000, the increase was only 2.7% from 2000 to 2001. Japan recorded the highest number of first filings in 2001, but the figure of 382,815 represents a slight decrease compared to the previous year's total of 384,20'1. The EFC contracting states have also recorded a slight fall in the numbers of flings, from 124,326 in 2000 to 121,387 in 2001." Going beyond the statistics in the table, the commentary notes that "[t]he total number of first filings in 2000 was 826,578. From these first filings, one year later, in 2001, 454,762 subsequent flings were registered. Thus on average one invention, for which one first filing was made, led to 0.55 subsequent applications. Considering the demand for patent rights generated by one first tiling, for one invention a first filing in 2001 led to 13.4 subsequent applications for patent rights. Three years ago, the rate was at 7.4". http://www.ugpto.gov/web`/tys/tsr2002/ch3/3* 2.htm1
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Appendix to Testimony of Harold C. Wegner

In terms of the sheer number of filings by Canadians and Japanese in their local patent granting authorities, in the Pacific Rim amongst the top six countries, the United States and Japan account for roughly ninety percent of all filings from the leading Pacifc Rim countries.26

1. Japan 109,000
2. United States 88,000
3. Korea 22,000
4. China 5,000
5. Australia 1,000
6. Canada 1,000

The PTO has recognized for many years that to more efficiently handle the patent procurement process at its local office it must better coordinate and handle the filings from abroad - and particularly from Japan, the number one overseas filer of patent applications in the United States.

The importance of Japanese filings amongst the major patent granting authorities of the world is demonstrated by the flow of-appaiea4-iowi-s2-m-~s~aest the trilateral blocs27 :

Japan to U.S. 67,000
U.S. to Japan 48.000
Japan to Europe 30,000
Europe to Japan 42,000
Europe to U.S. 73,000
U.S. to Europe 57,000

'6 Patent application filings by country (2001), WIPO IPStat/2001/A, htta://www.vyipo.int/ipstats/em/publications/a/pdf/p atenLs.d If all countries of the world were counted in the surveys, the rankings would be reordered below the second rank. For example, Germany would be third with 19,000 - with other European countries also bumping lower ranked countries; even outside the European patent convention, several countries would be bumped downwardly by the Russian Federation (14,000) and the Ukraine (10,000).

27 Trilateral Statistical Report 2002, § 3.3, Interbloc Activity, Graph 3.10, Flows ofApplications between Trilateral Blocs http://www.uspto.gov/web/tws/tsr2002/ch3/3-3.htinl

App., p 19
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For more than a generation, Japanese nationals who have trained in. the United States have sought, often successfully, to be permitted to take the U.S. patent examination, often with success, but then upon their change in visa status or return home to Japan have been removed from the registration rolls. Instead of having the', imprimatur of being U.S. patent attorneys or agents, and thus both being under the control of the U.S. OED arid having an increased roll in preparing United States patent applications, the OED has denied continued registration status, thereby diminishing its roll in policing the American patent applications of Japanese origin. 2g

Clearly, a residency requirement for Japanese but not Canadians is antithetical to the interests of the United States, as well as swimming upstream against the trend of the law to permit practice without a residency requirement. 29

C. Free Registration for "Unqualified" Favored Classes

While the two previous sections demonstrate the disqualification of a large class of lawyers and foreigners who are or who could become patent experts, ironically at the other end of the scale of arbitrary practice the PTO freely admits to practice whole categories of lawyers who are not possessed of the technical background required for others or who may have uo

2sA simplistic answer is that only American patent attorneys and agents should prepare the drafts of U.S. patent' applications. This is no more feasible than having Japanese patent attorneys prepare the initial Japanese applications of American applicants. In .fact, the Japanese do a far better job of involvement of their own patent professionals in the United States practice than Americans do in Japan. Thus, there have been literally thousands of Japanese patent practitioners who have resided in the United States over the past forty years - some for months and others for years - who have worked to learn the U. S. practice, generally working within patent law firms who handle the work for their employer in the United States. The converse virtually never happens.

29 New Hampshire v. Piper, 470 U. S. 274 (1985) (holding that a requirement that attorneys must be residents of the state in order to be admitted to practice law violated the Privileges and Immunities Clause, Article TV, Section 2 U.S- Constitution). See also Wallace v. Calogero, 286 F.Supp.2d 748 (E.D. La. 2003).

App, p 20
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experience at all in patent law other than perhaps having "[p]rovided substantial guidance on *** changes to the Manual of Patent Examining Procedure[.]" The patent attorney or agent registration is viewed by the PTO officials as a golden parachute for themselves and their employees. By keeping the number of registered patent attorneys and agents mininuzed through hardball restrictive policies toward outsiders, a free ride is given to registration to numerous employees of the PTO, including some who clearly never have achieved the technical qualifications by university tecbnical degree or practice and all without exayaination that is required of all others. Nothing could be more arbitrary or capricious than this practice.
While the PTO plays excludes clearly competent attorneys at law, it provides a special golden parachute to patent, examiners who may have never even practiced drafting a single claim. particularly from the understanding of an enforceable scope and who are not lawyers - provided they have served a four year period as patent examiners. Already not later than the 1960's it was clearly recognized by the leadersbip of. the PTO that one or two years is the maximum period of time needed to gain whatever skills one needs to meet the minimum requirements of a patent attorney insofar as examiner skills may be concerned, but that the four year period was maintained (if not originally created) as a tool to get examiners to serve for four years -both to gain as much value from the examiner as well as to hope that the examiner may be wore satisfied and stay with the office by staying this longer period. But, the four - or ten or twenty - year examiner is not any more necessarily skilled in drafting claims for an enforceable scope than one with two years. Clearly, an examination should be required
Conversely, there are some in the PTO who have not examined at all or if they have the time period was so long ago that they are not necessarily up to speed with the requirements of the PTO today in terms of the nuts and bolts that are tested on the patent examination. Or, some PTO officials are lawyers who are clearly not qualified in terms of the same technical requirements that are imposed on those not specially privileged by the in house rules made to favor the in house retirees. Thus, sunder 37 CFR §
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Appendix to Testimony of Harold C. Wegner

Examining Procedure[.]" So, too, is anyone in the OED entitled to automatic registration because he has "develop[ed] training or testing materials for the patent examining corps[J" 37 CFR § 11.7(d)(3)(a)(i). While a Federal Circuit clerk expert in patent law from service on that court cannot be registered without a technical degree, if they perform a stint at the PTO in the Solicitor's office and "represent[ ] the Office in patent cases before Federal courts" they are given an automatic registration under 37 CFR § 11.7(d)(3)(a)(ii). Or, if one is a former Under Secretary of Commerce who has signed regulations for the Federal Register and has thus "[p]rovided substantial guidance on patent examination policy" this may well qualify without a technical background or test under 37 CFR § 11.7(d)(3)(a). SeeAPPENDIXII: THE ROGAN EXCEPTION FOR FREE PTO REGISTRATIONFOR UPPER END PTO OFFICIALS.

III. TOWARD A UNIFIED FEDERAL PATENT BAR

A. The Failed Paradigm of Narrow Agent practice.

"(P]atent agents are usually just as well qualified as patent attorneys**."

- Official PTO Web Statement3°

The PTO provides little guidance for the public to differentiate amongst attorneys and agents. Indeed, neither the phrase "unauthorized practice" nor. the Sperry case is ever even mentioned in any section of the Manual of Patent Examining Procedure. 31 To measure the truth of the

30 This is the only distinction between a patent attorney and a patent agent acknowledged by the PTO on its website under `ATTORNEYS AND AGENTS', said to be "excerpted from General Information Concerning Patents print brochure," http://www.tLsRto.gov/web/office s/pac/doe/general/attomey.htm [downloaded December 29, 2003]. The more complete quotation is that "hisofar as the work of preparing an application for a patent arid conducting the prosecution in the Patent and Trademark Office is concerned, patent agents are usually just as well qualified as patent attorneys

31 Searches carne up without hits on the Manual ofPatent,Examining Procedure on Westlaw on January 4, 2004 for "Spent'" and for "unauthorized practice".

App., p 22
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official imprimatur on patent agents as "are usually just as well qualified as patent attorneys," one needs to first see precisely what an attorney can do that an agent cannot. Only then will it be seen whether equality is possible.

There is thus hardly anyone who can be a "patent attorney" or "patent agent" who can practice before the PTO without a state bar licensure because of the extreme limitation that has been placed upon the scope of the licensure both by the courts and the PTO itself. Thus, "[p]atent agents are persons who are registered to practice before tile P.T.O., but who are not attorneys. At one time, much of the work of preparing patent applications was done by patent agents, 'many of whom had independent practices. Today, patent agents usually are law clerks who have passed the Patent Bar Exam, but who have not fnished law school. ,32 They "may not render validity or infringement opinions since they are not licensed to practice law."3

Patent licensure permits little more than one being a law clerk -beyond the actual drafting of patent applications and their prosecution, or performing legal work such as assignment drafting under the supervision of a licensed lawyer. The licensure in the early 1960's covered only that much .34 In .1Vlahoning County, the Ohio tribunal noted that "the United

32 Kinney 3c Lange, P.A., Intellectual Property Law for Business Lawyers, § 1.2,
The Practice Of Intellectual Property ,Law (West 2003).

33 Id.

34 See Sper7y v. State offla. Ex rel. Florida Bar, 373 U.S. 379, 400 n. 43 (1963), citing Chicago Bar Assn v. Kellogg, 88 N.E.2d 519 (I11.App. 1 Dist. 1949). In Kellogg, 88 N.E.2d at 524-25, the court held that "tbe rendering of opinions relating to the infringement of patents and the enforcement of patents and trade marks very definitely involves the practice of law [beyond the licensure of the Patent Office to prosecute patent applications]. Whether or not a patent is violated depends upon many factors, which question can only be determined by the courts, federal or state as the case may be, presented by duly licensed attorneys at law. When a lawyer is called upon to examine and render an opinion upon the title to a patent, he must not only have the knowledge enabling him to construe instruments of record in the Patent Office, but he must also have a wide knowledge of law which will involve collateral issues entering into the ultimate decision. He must be familiar with the laws of descent and distribution, bankruptcy, contracts, and civil practice, all of which are particularly within the field of an attorney at

App., p 23
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Appendix to Testimony of Harold C. Wegner

States Supreme Court [in Speny]strictly limited application of the federal supremacy doctrine: `[T]he State maintains control over the practice of law within its borders except to the limited extent necessary for the accomplislunent of the federal objectives. "'3s It thus "conclude[d] that the state of Ohio has the authority to regulate conduct by a federally registered patent attorney in matters outside the scope of authority granted by federal law. Ohio thus joins other sates in determining that the unauthorized practice of law falls within the jurisdiction of the state regulating body, w nether the source of the law practiced is the state of Ohio, another state of the United States, the United States, or a foreign coUntry_"36 While clearing the respondent of unauthorized practice of law relating to prosecution of a reexamination proceeding, ancillary conduct was held to be the unauthorized practice of law. j'

A New Jersey advisory opinion provided~comprehensive guidance on the scope of federal licensure,38 dealing with patent attorneys and agents who are not a member of the New Jersey bar.39 The opinion held that "[a]

law, and from which field all others are excluded. Opinions and advice pertaining to the preparation, construction and enforcement of licenses, sublicenses, cross-licenses, and the like, require legal skill and knowledge and must be based, not only upon an examination of facts, but upon sound conclusions of law. Only an attorney at law is authorized to perform such service for a fee. That the practice of patent law is a highly specialized .field is to be admitted, but it is ably covered in this State by the many capable attorneys at law who are there practicing." Kellogg, 88 N.E.2d at 524-25,

35 Mahoning County Bar Assn. v. Harpman, 608 N.E.2d 872, 575 (Ohio Bd.Unauth.Prae.1993)(quoting Sperry, 373 U.S. at 402).

3'
3 61d.

Id. at 579 ("[R]espondent has engaged in the unauthorized practice of law by (1) the preparation anti signing of documents containing legal opinions outside the scope of authority granted him by federal law; *** and (3) acting on behalf of another to negotiate the settlement of the pending Conrad/GPAC litigation").

38 Patent Attorneys and Agents, New Jersey Unaath. Prac.Op. 9, 95 N.J.L.J. 269, 1972 WL 19655 (NJ.Comm.Unauth.Prac. 1972),

39 As used in this opinion, the term "Patent Attorney" designates a person
registered to practice before the United States Patent Office and licensed to practice law

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Patent and Trademark Office
Appendix to Testimony of Harold C. Wegner

Patent Attorney or Agent not admitted to practice law in the State of New
Jersey may not lawfully engage in any of the following activities within the State of New Jersey:

"(a) He may not advise his client as to the ownership of. an invention such as where a question of ownership arises by virtue of employment or other
contractual relationship between his client and others.
"(b) He may not advise his 'client as to what the client's rights may be under forms of legal protection available tinder federal or state law which are
alternate to patent protection, such as trade secrets, unfair competition, trade marks, copyrights, and anti-trust law; provided, however, that he may advise his client that there are alternate forms of legal protection on which he