MR. GRISWOLD:  Good morning.  I am Gary Griswold. 
       I am representing IPO, Intellectual Property Owners.
       Intellectual Property Owners is located at 1255
       23rd Street NW, Suite 850, Washington, D.C. 20037.  I am the
       President of IPO.
       IPO members are responsible for a substantial
       portion of the R&D that occurs in the United States.  In
       1993, members of IPO received 23 percent of all U.S. patents
       that were received by U.S. nationals.
       IPO strongly supports the 20-year patent term
       measured from application filing and provisional patent
       applications, both of which were adopted by the Uruguay
       Round Agreements Act, Public Law 103-465.
       The 20-year patent term measured from application
       filing will discourage the abuses of the system that have
       resulted in unreasonably extended patent terms in some
       cases.  The provisional application will permit applicants
       to make an initial filing quickly and at a relatively low
       cost.  It should benefit many that do not have access to the
       system today because of cost.
       It is very important that the Patent and Trademark
       Office implement the 20-patent term and provisional
       application filing procedures in a way that will best
       achieve the objectives that Congress intended.  Some people
       are concerned that with the 20-year patent term measure for
       filing patent applications will not receive as many years of
       patent life as they would with the term of 17 years from
       grant because applicants will encounter unreasonable delays
       in the Patent and Trademark Office.  There are some
       extensions that you mentioned that are provided in the
       Opinions differ on the magnitude of this problem. 
       IPO strongly opposes any legislation that would return the
       term of 17 years measured from grant and which would reopen
       the abuses that I mentioned earlier.  We do, however,
       support PTO practice changes or legislation that would
       ensure against loss of patent life as the result of PTO
       delays that are beyond the control of the applicant.
       We also support patent term restoration that will
       be a subject of the hearing this afternoon relative to
       products involved in regulatory approval and Ag Chem, for
       example, pharmaceuticals.
       I am going to specifically turn to a couple of
       areas where I think work needs to take place.  This relates
       to final rejection practice and restriction practice.
       The transitional provisions provided in Public Law
       103-465 and the rules that are the subject of this hearing
       liberalize final rejection practice and restriction practice
       on certain applications on file at the effective date of
       this legislation.  More is needed in this area.
       We propose that the PTO work with the private
       sector to develop some changes, and I am going to talk a
       little bit more about that, now.
       In order to prevent delays, we recommend permanent
       reform of the long-standing practice of almost always making
       the second rejection in a patent application the final
       action.  This needs to be relaxed.  Oftentimes, the issues
       have not been crystalized at that point and maybe further
       interviews need to take place and other activities need to
       take place, and forcing a filing of a continuation, we don't
       believe, is good practice.  With the 20-year patent term,
       the applicants will be incentivized to move forward with the
       I think if applicants are given the opportunity to
       continue prosecution efforts for final rejection they would
       avoid the delays and inefficiencies that are inherent in the
       filing of continuations, which I mentioned.  With payment of
       a reasonable cost-based fee, the PTO could permit applicants
       to submit amended claims or additional evidence or arguments
       after final rejection.  Both of these would help.   This
       would help the PTO and help the applicant reduce cycle time
       to a final conclusion relative to that technology or
       invention, so we think work needs to be done there.
       There is some language in the provision relative
       to the transition that deals with this.  There you are
       allowed two additional shots for payment of a fee.  Activity
       like that needs to take place relative and on a permanent
       Now turning to the restriction practice.  We also
       urge that permanent reform needs to take place relative to
       restriction practice in order to help avoid PTO delays
       beyond the control of the applicant.  Again, the legislation
       is not required.  PTO rules could be amended, for example,
       to permit all or at least several inventions to be examined
       in a single application upon payment of an extra fee.  
       We can calculate the fee.  The math can be done to
       figure out what the extra cost burden is.  The practice
       would be appropriate, for example, in situations where the
       claims are related, such as method and apparatus claims or
       product claims and method of making or using claims.
       Some say our classification or examination system
       won't allow us to do this.  Well, I say, re-engineering may
       provide an opportunity to do this, so let's do some
       re-engineering and get this fixed.
       COMMISSIONER LEHMAN:  That is a very important
       point that you raise, because it has been increasingly our
       observation here inside the PTO that certain of our
       practices are driven by the fee structure, and then you get
       a very artificial and in some ways inefficient processing.
       MR. GRISWOLD:  Right.
       COMMISSIONER LEHMAN:  I am wondering -- of course,
       many fees are statutory fees.
       MR. GRISWOLD:  Yes.
       COMMISSIONER LEHMAN:  Assuming that we are not
       talking about charging more than the cost of the
       application, and assuming that we would not change the small
       entity subsidy, would IPO support a little more discretion
       in the Commissioner to have more flexibility in setting fees
       after having public hearings and notice and so on and so
       MR. GRISWOLD:  Yes, I think fees should be
       cost-based.  What you need to do is to set down and process
       people, look at the best system for examining method and
       apparatus claims together, for example.  What is the best
       system?  And then, maybe the filing fee should be 1.5 times
       the normal application fee.  Maybe it is 1.3, maybe it is
       1.6, you do the math and come out with the right equation.
       We shouldn't let two things drive us.  One, cost,
       we shouldn't be wooden in our approach relative to cost; and
       two, we shouldn't be wooden relative to the fact that we
       have a classification or examination system that says "Art
       Unit X deals with it now; Art Unit Y deals with something
       Restriction practice needs a lot of work.  It is a
       serious problem and it needs to be fixed, no matter what. 
       We need to have that fixed.
       It sounds to me like -- and the nods of the heads
       of you guys -- you seem to agree, that there is some effort
       that needs to take place in this respect.  We appreciate
       Back to cost.  Obviously, we want to keep costs as
       low as possible because we want people to have access to the
       system of all types and financial ability.  The fees that
       are proposed for additional inventions requested for a
       single application under 1.129(b) and for filing addition
       arguments after final appear to be higher than the cost
       I don't know.  I haven't done the math, but it
       seems like you just picked a fee from the air rather than
       picking it as cost justified.         So, these should be
       cost-based and reasonable fees.
       Another situation is where a regular application
       is converted to a provisional application which is followed
       then by another regular application.  Once again, that
       should be a cost-based fee and I doubt that you need to
       charge the full filing fee.
       Now, those are the comments that I have relative
       to those two issues.  I am just going to hit a few of the
       details for a couple of minutes of the rules.
       The first one is, the new rules should avoid
       adding paperwork as much as possible.  The Federal Register
       proposes that file wrapper continuing procedure of Rule 1.62
       will not be used for provisional applications.  
       However, this seems to be a good situation where
       it could be used because you are going to use the same file,
       so it seems to me that that is a good opportunity to use
       1.62.  I don't know all the nuances of why you did it this
       way, but that seems like an opportunity to save paperwork.
       Another one is that the proposed rule should be
       revised to make clear that an applicant may file two or more
       provisional applications in a 12-month period before filing
       the regular application.  That is the deal, but we want to
       make sure that is clear.
       Another point is that in proposed Rule
       1.701(d)(2), we talk about due diligence and looking at due
       diligence relative to appeals, but you are looking at due
       diligence during the period of prosecution.
       It appears that the statute, if you take a look at
       the statute, the statute would indicate that it relates to
       the due diligence during appeal.  I think we need to take
       another look at that.  I am not sure that the rule tracks
       with what the statute says.
       We are going to submit some additional suggestions
       in writing relating to updating best mode, making sure that
       the inventors relate to the invention disclosed in the
       patent provisional, and allowing the filing of a regular
       application and a provisional application and another
       regular application.
       Final comment would be this.  That we need good
       forms and good information relative to how to reference
       these provisional applications.  There was some real good
       rulemaking done, I understand, and published in the Official
       Gazette on February 1, 1983.  That was a long time ago, but
       it laid out how to do it.  
       There is a lot of opportunity for mistake here
       because of the changes.  We need to have really a
       see-spot-run type set of rules and directions, so we would
       ask you to provide that and I am sure you can.
       Thank you.  Any other questions or comments?
       MR. KIRK:  Mr. Griswold, one comment, and that is
       that with respect to the conversion and using the 1.62 to
       convert the provisional to the complete.
       MR. GRISWOLD:  Yes.
       MR. KIRK:  The concern that was had about allowing
       that practice, where you would simply do the file wrapper
       conversion, had to do with the situation where you would not
       have a claim in the provisional and the conversion to the
       complete, if it were at the relevant date and claim were not
       present, you might have a problem in terms of losing the
       benefit of the provisional's filing date because you
       wouldn't have a complete application.
       Not that that can't be overcome, but in your
       additional comments, if you could address that for us, we
       would appreciate it.
       MR. GRISWOLD:  Actually, what I was referring to
       is the reverse to that.  
       MR. KIRK:  Complete to provisional, okay.
       MR. GRISWOLD:  Complete to provisional.  I
       understand the point you are making relative to the reverse.
       MR. KIRK:  Right.
       MR. GRISWOLD:  But when you go, complete to
       provisional, it is a different issue.
       MR. KIRK:  Right.
       MR. GRISWOLD:  That is my point.  Okay?
       MR. KIRK:  Thank you.