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Comments on the 21 Topics in the Advanced Notice of Proposed Rulemaking

November 19, 1998

Mr. Hiram H. Bernstein

Box Comments - Patents

Assistant Commissioner for Patents

Washington, D. C. 20231

Re: Comments on the 21 Topics in the

Advanced Notice of Proposed Rulemaking,

Published in the Federal Register, Vol. 63, No. 192,

October 5, 1998

Dear Mr. Bernstein:

We certainly appreciate the fact that the U. S. PTO seeks the comments of its customers before implementing major changes in the Rules of Practice. The following comments are submitted on behalf of the firm of Oblon, Spivak, McClelland, Maier & Neustadt (the Oblon firm) which, for the past eight years, has obtained more patents than any other firm, and accordingly has standing as a significant customer of the U. S. PTO. We sincerely hope that you will take into account our comments which are submitted with the earnest intent of improving the patent system by calling to your attention issues of particular concern to large-scale practitioners such as ourselves.

As background to the following comments, we are very pleased that the U. S. PTO has established business goals that are intended to make the PTO a more business-like agency. However, we would like to call to your attention the fact that, while the relationship of PTO to our firm fits the business-customer analogy for some of the changes you propose, this certainly is not true in the area of information disclosure. In that area the PTO and the courts have made it clear that the relationship between the PTO and the practitioner is not one of business to customer, but is one of Sovereign to subject. Thus, just as the Sovereign has the responsibility of looking after the welfare of his subjects, so we urge that as the PTO pursues its business goals, it consider carefully the welfare of practitioners such as ourselves before imposing upon us further onerous liabilities. In this light, we comment as follows.

The subject Federal Register notice states that full and complete disclosures of information are often made "solely to save applicant the effort of reviewing each of them", or to prevent the applicant being placed "in a position (in court) of having to explain why a particular document...was not deemed relevant" suggesting that compliance with the duty of disclosure is in the nature of a matter of convenience for us. We respectfully submit that compliance with the duty of disclosure is not a matter of convenience for us; it is a matter of maintaining our professional careers and personal livelihoods.

The PTO, in pursuing its business goals, must take into account the vast difference in accountability that exists between practitioners and examiners in the disclosure examination relationship. Under PTO rules, the practitioner is accountable for disclosing relevant information known to him, and even information of which he is not personally aware, but which circumstances indicate he should have been aware. "Accountability" in this case means everything from loss of business to major financial sanctions and ultimately, loss of the right to practice. In contrast, the PTO and its examiners have no accountability. Given this imbalance, we believe it is improper for the PTO, acting in its role as Sovereign, to continue to hold the sword of strict accountability over the head of the practitioner, while acting in its role as a government business, it ties the practitioner's arms behind his back by imposing significant new limitations on his ability to freely disclose information to the PTO.

The Federal Register notice states that information of dubious relevance is now being disclosed to the PTO. There is a reason for this.

In patent litigation, finding a breach of the duty of disclosure is the most convenient way of rendering all claims in a patent unenforceable. Accordingly, in every case documents known to applicant or his representatives, but not disclosed to the PTO, are invariably scrutinized to determine if a violation of the duty of disclosure can be proven. Furthermore, in litigation it is common that additional prior art not previously known is discovered. Consequently, previously non-disclosed documents that may not have seemed relevant when the application was before the examiner, can take on a new relevance in light of additional material uncovered during litigation. As a result, thorough disclosure of information is considered necessary as virtually the only defense to allegations of breach of the duty of disclosure, and the resultant holdings of unenforceability which in turn lead to the loss of valuable intellectual property rights and potentially to malpractice claims. Under current law, complete disclosure of information is a necessity and an obligation of practitioners, not merely a matter of convenience. Failure to disclose is the quickest route to a career ending legal and financial disaster for every practitioner.

Against this stringent burden and severe liability, the Patent Office balances its inconvenience in a few cases in which numerous references were disclosed. Certainly this raises a question of fairness and reasonableness. Rather than impose an entirely new and untenable burden on the entire body of practitioners, wouldn't it be more logical and more appropriate for the PTO to simply maintain the current known and understood rules, and develop other workable solutions for handling those few cases in which necessity requires that extensive IDS filings are needed to comply with the duty of disclosure?

For example, in those rare situations where extensive citations are filed, the examiner could call or write to request the applicant to submit a paper outlining the relevance of the documents, or to meet with the examiner to discuss them. We would certainly be happy to comply with any such request for assistance from the examiner, and we believe that most practitioners would feel the same.

The PTO's proposal to limit IDS filings fails to take into account that there are vast differences in complexity and value among patent applications and vast differences in how much information must be disclosed. On the one hand, an application for a simple device submitted by a private inventor and filed only in the U.S. may require relatively little material to be submitted by IDS. On the other hand, a new technology that will have commercial application throughout the world is an entirely different matter. The investment involved may be huge and dozens of related applications may be filed throughout the world. As a result, potentially hundreds of relevant official actions may be issued by patent offices throughout the world, and these, together with the prior art uncovered, must be disclosed to the U. S. PTO in all related applications. The two situations are very different and deserve different levels of attention by the PTO. In the latter case, even though the examination of the new international technology may be more difficult and time consuming, the public is better served if the PTO devotes more attention to such applications rather than ignoring that such differences exist. While the PTO may not be in a position to tell the difference between important commercial and unimportant technology, it is proper to assume that in view of the expense involved, no one would file hundreds or thousands of references unless the patent application in question was of extreme importance.

The PTO's approach to information disclosure is not realistic. Sometimes the most relevant information is a lengthy text, and the examiner is going to have to read it to do his job properly. The PTO needs to be more flexible and to understand that not all applications are equal in terms of the amount of relevant information that must be disclosed or of the length of pertinent documents. Limiting applicants to ten citations without comment is purely arbitrary, and clearly discriminates in favor of the owners of simple inventions filed only in the U. S. and against the owners of complex inventions, and inventions filed internationally.

The PTO proposal would require practitioners to describe the relevance of each citation over 10 to the claims in a case. In many situations it would be improper for practitioners to provide a unique description of each citation's importance relevant to the claims since in doing so practitioners would be potentially establishing file history estoppels before the application was even examined. This could be severely damaging to clients, and could therefore result in significant liability on the part of the attorney. This is a particular problem in dealing with applications received from overseas.

Nearly half of the applications filed in the U. S. PTO are foreign-origin applications. The proposed new IDS rules discriminate heavily against foreign applicants and practitioners representing foreign applicants for the following reasons. Unlike U.S.-origin applications, foreign-origin applications are originally prepared by practitioners outside the United States. They may be directly filed or revised somewhat and then filed by U. S. practitioners. But the

U. S. practitioner, not being the author of the case, is not nearly as familiar with the technology as would be the situation if he had written the entire application himself. To now require the U. S. practitioner to read all of the relevant prior art and comment on it in these applications would require an investment of time and expense many times greater than the entire expense now involved in filing such applications. The preparation and filing of the Information Disclosure Statement under the proposed new rules would become the single largest expense in filing and prosecuting foreign-origin applications. Foreign practitioners would not normally be in a position to provide the required analysis of the prior art in view of the fact that they are not familiar with U. S. practice and generally would not be able to relate the disclosure documents adequately to the U. S. claims, so the burden of the proposed rule change would fall on U. S. practitioners.

We wish to point out further that there is a very big difference between an attorney making a statement about the applicability of a reference to a claim and a patent examiner making such a statement. If the patent examiner makes a statement and is wrong, he has no personal liability. On the other hand, if the attorney is wrong, his personal liability is limitless. If his mistake results in a patent being held invalid, or not infringed, then the patent attorney may be sued by his client for lost profits, potentially amounting to millions of dollars. Furthermore, if the attorney error is found to be malpractice, the attorney can entirely lose his livelihood. In contrast, the patent examiner has absolutely no personal liability.

We strongly oppose the proposed new option of refusing consideration of information disclosure statements under certain circumstances. This proposal tends to ignore the real world situation in that all patent applications are not the same. In some instances, references cited are complex, and nothing can be done about it. The PTO cannot realistically ignore these situations, and must face them head-on in order to meet its mission of issuing valid patents. Furthermore, the PTO must provide a mechanism to prevent abuse of discretion by its examiners. We all know that there will be cases that are close to the line of demarcation, and that in these cases examiners will be inclined to refuse to consider the IDS. Some form of appeal for a review by a higher authority must be provided in order to guard against abuses of discretion that will be severely damaging or discriminatory to "customers" of the PTO.

Having provided this introduction, we will now specifically comment on each of the 21 topics set forth in the Advance Notice of Proposed Rulemaking.

1. The Oblon firm is opposed to simplifying the request for Small Entity Status. The only effective way we have of being certain that the client is properly complying with the Small Entity Status is the requirement that a paper must be submitted to the Patent Office. The law governing the definition of small entities is extremely vague and the only safe procedure available to us is to put all information available to us on the record to show that we intend to disclose fully all information brought to our attention in case of error. Eliminating the Small Entity Statement forms would eliminate the client's incentive to provide their attorney with information that is needed, particularly clients from overseas who often have difficulty in fully understanding the nuances of U. S. law.

2. We have no objection to requiring separate surcharges and supplying filing receipts, as indicated.

3. We have no objection to permitting delayed submission of an oath or declaration, as indicated.

4. We have no objection to limiting the number of claims in an application, as indicated.

5. We have no objection to harmonizing standards for patent drawings, as indicated.

6. We have no objection to printing patents in color, as indicated.

7. We have no objection to reducing the time for filing corrected or formal drawings, as indicated.

8. We have no objection to permitting electronic submission of a luminous material, as indicated.

9. We are strongly opposed to the proposals imposing limits or requirements on Information Disclosure Statement submissions. We file several thousand patent applications in the U.S. Patent Office from abroad each year. We do not have any special knowledge of the patent application or the invention and it is impossible for us to make any meaningful personal review of an IDS statement. Furthermore, some relevant materials are submitted in foreign languages. Therefore, it is impossible for us to determine whether any particular citation is relevant or not. If the client submits the same to us, we have no choice but to submit it to the Patent Office where the Examiner, as an expert, can determine the relevance.

It is an impossible task to provide the Patent Office with a copy of each cited U.S.

Patent application . If the Patent Office believes that they are overwhelmed with paper now, wait until such a rule goes into effect and we begin submitting effectively 10, 15 or 20 U.S. patent applications in an Information Disclosure Statement.

It is impossible for us to provide a unique description of each citation's importance

relative to each independent claim. A description that specific would definitely lead to untold liability on the part of the attorney and would merely set us up for personal liability. It would be possible to accept such liability if we were the ones preparing the patent applications, but since the patent applications are prepared overseas and then filed in the United States under one of the international conventions, we have no way of knowing what unique description of each citation's importance is relative to each independent claim.

We do not understand the exception limiting the disclosure to 10 citations.

Suppose we have an initial 10 citations based on the prior art known to the inventor and we obtain a second list of citations from a potential licensee? We may be of the opinion that none of the references are relevant to any of the claims, but how do we not submit those references when others are indicating that they are relevant?

The requirement that the description of each citation would have to set forth the

teaching or showing of a feature relative to the claimed invention which is not taught or shown by other citations is flatly impossible. This is not the same as a Patent Examiner making citations wherein the Patent Examiner does not have personal liability. The attorney has personal liability and would have no way of knowing whether a feature disclosed in one citation is or is not taught in a different manner from that showing or teaching of the same feature in a different citation.

10. If the Patent Office refuses to consider an Information Disclosure Statement what recourse would the applicant have? Must he take the case to the U.S. District Court to obtain consideration? Must he refile the patent application?

11. The Oblon firm objects to providing no-cost suspension of action which results in publication of the application. Publication of an application can be expected to be abused. Currently it is the policy of many companies worldwide to publish pending applications with very broad claims with the full knowledge that it is unlikely if not impossible to obtain patentability of such broad claims. The purpose of such publication is to discourage competitors from going into a particular field and/or to prevent the formation of venture capital investment into particular technologies by competitors. U.S. Publication at 18 months is not onerous since most U.S. patent applications are issued within about 20 months. However, if the request for suspension of action triggers an earlier publication date for the U.S. application, the fostering of unexamined patent applications on the American public can be one of the greatest disasters ever to hit the United States. It could mean the very substantial reduction of venture capital startup companies and the undersigned urges in no uncertain terms that any effort to move up the date of publication earlier than 18 months will be vigorously contested.

12. The Oblon firm has no objection to requiring a handling fee for preliminary amendments and supplemental replies.

13. The Oblon firm has no objection to changing amendment practice to require paragraph/claims.

14. The Oblon firm vigorously opposes the provision of providing for presumptive elections. Institution of this policy would result in the Examiner only examining one independent claim per application. The restriction practice is already being vigorously opposed by the entire world since it is contrary to agreements made by the U.S. under PCT. Imposing on top of this, presumptive elections would certainly exasperate an already impatient world patent community.

15. The Oblon firm has no objection to creating a "rocket docket" for design applications.

16. The Oblon firm has no objection to requiring identification of broadening in a reissue application.

17. The Oblon firm has no objection to changing multiple reissue application treatment.

18. The Oblon firm objects to creating alternative review procedures for applications under appeal unless the alternative procedure consists of a review panel of at least 3 Patent Office officials, not including the Examiner handling the case.

19. The Oblon firm does not object to elimination of preauthorization of the issue fee, as indicated.

20. The Oblon firm is of the opinion that the Disclosure Document Program is not a proper function of the U.S. Patent Office. Such a program can be implemented through independent publishing houses and there is no reason for the Patent Office to become involved in ordinary publications. The function and object of the Patent Office is to issue patents and a program such as the Disclosure Document Program merely diverts valuable resources from that mission.

21. The Oblon has no objection to creating a Patent Office Review Service for applicant created forms, as indicated.

Respectfully submitted,



Norman F. Oblon

Gregory J. Maier

Gerald J. Mossinghoff


United States Patent and Trademark Office
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