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Comment on the Advance Notice of Proposed Rulemaking





12/04/98 19:08 FAX 202 466 4949 H&A ENGINEERING Q002


Norman L. Balmer

Union Carbide Corp.


Ronald E. Myrick

General Electric Co.










TEL (202) 486-2396

FAX (202) 486-2893



Marc S. Adler

Rohm and Haas

Erwin F. Berrier, Jr

IPO Immediaia Past President

Francine J. Berry


Ronald A. Bleeker

Mobil Oil Corp.

Frederick T. Boehm

IBM Corp.

W. Dexter Brooks

Coca Cola Co.

William D. Budinger

Rodal, Inc.

James W. Gillman

Motorola, Inc.

Jack G. Goldstein

Whitaker Corp.

Stephen S. Grace

Dow Chemical Co.

Michael R. Greene

Lucent Technologies, Inc

Gary L Griswold


J. Jeffery Hawley

Eastman Kodak Co.

Robert P. Haynor

United Technologies Corp.

Edward F. Heller, III

Seagate Technology, Inc

William B. Heming

Caterpillar Inc.

Wayne C. Jansche

Hankel Corp.

Herbert H. Jarvis

Pioneer Hi-Bred International

Richard C. Levy

Richard Levy & Associates

William F. Marsh

Air Products & Chemicals, Inc

Roger L. May

Ford Motor Co.

Michael A. Nametz

Exxon Corp.

Wallace L. Oliver

Amoco Corp.

James P. O'Shaughnessy

Rockwell International Corp.

Garo A. Partoyan

Mare Incorporated

Jacobus C. Rassar

Proctor & Gamble Co.

Vernon R. Rice

Dupont Co.

Peter C. Richardson

Pfizer, Inc.

Allen W. Richmond

Philips Petroleum Co.

Melvin J. Scolnick

Pitney Bowes Inc.

Richard H. Shear

Monsanto Co.

Carl L. Silverman

Intel Corp.

Gary D. Street

Hoechst Marion Roussel


Janice E. Williams

Smith Kline Beacham Corp.

John K. Williamson

PPG lndustries, Inc.


Herbert Wamsley

Ada E. Barnes





December 4, 1998



The Honorable Bruce A. Lehman

Assistant Secretary of Commerce and

Commissioner of Patents and Trademarks

Washington, DC 20231

Attention. Box Comments- Patents, Assistant Commissioner for Patents, Washington, DC 20231

Dear Commissioner Lehman:

I am writing on behalf of Intellectual Property Owners Association (IPO) to comment on the Advance Notice of Proposed Rulemaking published in the Federal Register on October 5, 1998 (63 Fed. Reg. 53498). We appreciate the opportunity to present our views on the proposals at an early stage in the development of new patent practices. We commend the PTO for its efforts to improve its effectiveness and efficiency.

Our comments reflect decisions made by the full Board of Directors of IPO. Serious concerns about the proposals are widespread among IPO members. We have directed our comments only to those topics that appear to have the greatest potential for proceeding in the rulemaking process or that have the greatest effects on patent owners. We hope this focused approach will be helpful to the PTO.

Numbers in the headings in this letter correspond to the numbers assigned to the topics in the Advance Notice.


Topic 9 - Limits/Requirements for Information Disclosure Statements

IPO believes the proposed addition of further limits and requirements for Information Disclosure Statement submissions is fundamentally a bad idea, and IPO opposes such Beer limits and requirements.











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The limits and requirements would place additional burdens on practitioners and applicants, significantly raise the costs of processing a patent application in the PTO, and create unnecessary risks and costs for the patent owner during enforcement of rights under the patent. The determination of the relevancy of prior art is a responsibility that must be performed by the PTO -- a job that each examiner performs in each application when looking at any Collection or data base of documents.

The problem to be solved is one of a very few applicants submitting voluminous citations of prior art out of an abundance of caution in attempting to satisfy their duty to disclose to the PTO. The PTO has not cited any study that would warrant any change in the practice of filing of information disclosure statements under the present rules. The PTO should be careful not to overreact by adopting a drastic cure that would be more harmful than the disease.

The PTO has pointed to several unique situations of voluminous citation of prior art that may call for equally unique examining approaches by the PTO. Consideration should be given to addressing these unique circumstances involving citations of a large number of documents with additional time given to the examiners, and possibly with the adoption of a fee to compensate the PTO for this additional time. The PTO already has set a precedent by adopting a fee for the submission of an IDS during the period between the first Office action and a final decision by the Office to, in part, compensate the PTO for additional work that would have to be expended in considering new prior ad at an advanced stage in the examination process.

The burdens that would be placed upon applicants by adoption of the rule are difficult to justify, The proposed limits and requirements would magnify the risks and burdens on applicants, and apparently would create yet additional information in the form of a unique description of each document relative to each independent claim @ would be considered by the examiner m addition to the document itself. The proposals would place increased burdens on everyone MV01ved in the examination process, increase cost to applicants, increase the possibility of mischief during litigation, and increase the possibility of malpractice suits, We believe the problem can be solved without increasing the burdens and risks on applicants, while maintaining the proper role of the examiner to determine the relevancy of the prior art. It should be noted that examiners normally consider far more than IO prior art references during their searches of the prior art. Moreover, examiners typically gain some expertise in their fields and can evaluate most prior art references quickly and efficiently. Additional time should be given, or additional fees charged, only in exceptional cases.

Topic 11 - Deferred Examination

The PTO has proposed an optional deferred examination opportunity for a period of up to three years upon payment of a fee- Upon granting of the request to defer, the content of the application would be made available to the public, IPO opposes this proposal because it would increase uncertainty over legal rights in new technology.





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The best patent system for providing certainty as to patent rights is one that completes the examination of most applications promptly. IPO supports achieving an average pendency of 18

months. We realize that some opportunities already exist in TJ.S. patent practice for lawfully delaying the examination of patent applications, but we do not favor expanding opportunities for delay.

The PTO proposal would result in work for the PTO being postponed or avoided. , The disadvantages of the proposal include:

· Uncertainty facing innovators as to whether their new products or processes will infringe a patent issuing from a deferred examination.

"Gamesmanship" by patent applicants, including strategic delay in patent issuance, and

· Ability of applicants to seek broader claims, or claims to different subject matter, than the claims made public.

We believe the public's interest in ensuring a rapid determination of rights is more important

than the needs of patent applicants to delay examination of already-pending applications.

The PTO has requested comments on a concern that publication of the application, coupled with delay in examination, could have a chilling effect on others active in the same field. To some extent, this concern could be addressed by providing that any member of the public upon the payment of a small fee, or the Commissioner, could cancel any official deferral. We believe, however, that any delay in examination inevitably would have some chilling effect on others active in the same field. Deferred examination also could result in more instances of surprise to established manufacturers from late issuance of patent claims of broader scope or covering different subject matter dm originally sought.

The supposed benefits of deferred examination are largely illusory. A patent applicant who wants to assess the commercial potential of an invention usually is well-advised to obtain a patent before completing the assessment, The argument that quality of examination would improve with deferred examination is debatable at best. There is no assurance that more would be allocated to examination or resources for examination would be improved. Systems 'm other countries that have employed deferred examination often have separated the process into a search stage and an examination stage, a separation that is not necessarily more efficient.

We reject the idea that the country which is the world leader in technology cannot staff its patent office at whatever level is necessary in order to examine all patent applications. Adoption of the PTO proposal would be tantamount to abandoning the longstanding goal of average patent application pendency of 18 months. If additional resources are needed in order to provide quality examination, the PTO should ask Congress for the resources. If the case can be made for





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an increase in patent fees to provide more resources for supporting the full examination system,

the PTO should submit a fee increase proposal.

In any event, deferred examination should not be adopted by rule change. Such a fundamental change in patent policy, if it is to be made, should be made by changing the U.S. patent statute. Congress has not been willing to adopt deferred examination proposals in the past.

Topic 16 - Requiring Identification of Broadening in Reissue Applications

We oppose the PTO proposal to require a reissue applicant to identify all occurrences of broadening of the claimed invention in the reissue application. This proposal would place patent owners unnecessarily at risk of having claims in the reissue patent held invalid for failure to identify all instances of broadening the claims in the reissue patent.

The regulations adopted by the PTO effective December 1, 1997, deleted the requirement that a reissue declaration identify every change made to the patent in a reissue application. This change properly relieved applicants and the PTO of unnecessary burdens, and substantially avoided the risk to patent owners having claims in the reissue patent hold invalid for failure to identify in the reissue declaration all the errors in terms of specific and significant amendments to the claims. See Nupla Corp. v. IXL Manufacturing Co., 114 F.3d 191, 42 USPQ2d 1711 (Fed. Cir. 1997).

The determination of whether a claim is broadened in any particular respect is uniquely an examining function that can and should be performed by competent patent examiners. If the PTO has information to suggest that examiners are not making proper determinations relative to

the breadth of claiming in a reissue application consideration should be given to additional and

specialized training to address the problem.

Topic 18 - Alternative Review Procedures for Appealed Applications

We oppose the proposed alternative review procedures for appealed applications. The proposal is for alternative review procedures that amount to little more than an advisory appeal conference for a fee. We urge greater use of appeal conferences instead.

The PTO has requested comments on the pool of PTO employees who should act as reviewers, and on whether each technology center should be free to establish its own procedures for such reviews. The appeal conference program that had been successfully adopted by Group 1800 demonstrated that up to a third of the applications on appeal could be prevented from being transmitted to the Board of Appeals on grounds that did not meet the test of prima facie unpatentability. An appeal conference can be a very effective tool to prevent =necessary appeals.

If alternative review procedures are adopted, minimum practices and guidelines should be established for these procedures, while permitting technology centers to go beyond the minimum




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criteria. Reviewers should be selected from those individuals having demonstrated technical and legal knowledge and ability at a level that is above the minimum that appears to be acceptable for the grant of full signatory authority.

The proposed procedures for a second primary examiner to issue an advisory opinion that could be adopted or ignored by the examiner examining the application is not satisfactory. Where there is a disagreement between the examiner who has done the review and the examiner in charge of the application, some mechanism should be adopted to resolve whether the applied grounds of rejection set forth a prima facie case of unpatentability.



In conclusion, we urge the Office to search for alternative solutions to the problems identified in the Advance Notice. In some instances we have suggested alternatives in our comments, Other parties commenting on the proposals no doubt also will offer alternatives that will deserve consideration before the PTO publishes a formal notice of proposed rulemaking.

We look forward to continuing open communication with the Patent and Trademark Office on proposals for improving the patent examining system. As requested, we are enclosing a diskette (Wordperfect 7-0) containing the text of this letter.




Norman L. Balmer




United States Patent and Trademark Office
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