A View from Both Worlds: A View from Both Worlds: USPTO and the Federal LabsUSPTO and the Federal Labs

Mojdeh Bahar, J.D.,M.A.Mojdeh Bahar, J.D.,M.A.Technology Licensing SpecialistTechnology Licensing SpecialistOffice of Technology TransferOffice of Technology TransferNational Institutes of HealthNational Institutes of Health

U.S. Department of Health & Human ServicesU.S. Department of Health & Human Services

FLC MAR Annual MeetingOctober 2007

Road MapRoad Map

USPTO and its mandateUSPTO and its mandate Federal Labs and their mandatesFederal Labs and their mandates Federal Labs as USPTO customersFederal Labs as USPTO customers What do USPTO’s customers/applicants want?What do USPTO’s customers/applicants want? Internal Workings of the USPTOInternal Workings of the USPTO ConclusionsConclusions

USPTO’s AuthorityUSPTO’s Authority

Right to exclude others from practicing the patentee’s Right to exclude others from practicing the patentee’s invention.invention.

Quid pro quoQuid pro quo Article I section 8 of the ConstitutionArticle I section 8 of the Constitution

““Congress shall have power... Congress shall have power... to promoteto promote the progress of the progress of science & the useful artsscience & the useful arts by securing for limited times to by securing for limited times to authors and inventors the exclusive right to their authors and inventors the exclusive right to their respective writings and discoveries.respective writings and discoveries.

Governed by Article 35 United States CodeGoverned by Article 35 United States Code

USPTO’s Function and MandateUSPTO’s Function and Mandate

To issue patents of high quality in a timely and efficient To issue patents of high quality in a timely and efficient manner.manner.

To insure that the invention sought to be patented is useful, To insure that the invention sought to be patented is useful, novel and non-obvious as set forth in 35 U.S.C. 101, 102 novel and non-obvious as set forth in 35 U.S.C. 101, 102 and 103.and 103.

To ascertain that the scope of the issued patent is clearly To ascertain that the scope of the issued patent is clearly defined and is commensurate with the extent of disclosure defined and is commensurate with the extent of disclosure to the public as set forth in 35 USC 112.to the public as set forth in 35 USC 112.

USPTO’s Function and Mandate …USPTO’s Function and Mandate …cont’dcont’d

To promote the progress of science.To promote the progress of science. USPTO hopes to achieve major goals by the new rules:USPTO hopes to achieve major goals by the new rules:

Reduce pendencyReduce pendency Increase efficiencyIncrease efficiency Improve the quality of patents issuedImprove the quality of patents issued

Federal Labs and Their MandatesFederal Labs and Their Mandates

Federal labs conduct “mission oriented” research.Federal labs conduct “mission oriented” research. Although the programmatic goals of the labs may vary, the Although the programmatic goals of the labs may vary, the

statutory requirements with which all labs must comply statutory requirements with which all labs must comply remain essentially uniform.remain essentially uniform.

Reporting inventions and using intellectual property Reporting inventions and using intellectual property rights, e.g., patents, as an incentive for commercializing rights, e.g., patents, as an incentive for commercializing the technologies born in labs are essential. the technologies born in labs are essential.

Every lab is subject to reporting requirements, to their Every lab is subject to reporting requirements, to their own agencies and the DoC.own agencies and the DoC.

Legal AuthorityLegal Authority

35 USC 20035 USC 200

Patent policy and Patent policy and objectives for federal objectives for federal government’s inventionsgovernment’s inventions

35 USC 20735 USC 207

Domestic and foreign Domestic and foreign protection of federally owned protection of federally owned inventions-patenting and inventions-patenting and licensing authority of agencieslicensing authority of agencies

35 USC 20635 USC 206

Uniform clauses and Uniform clauses and regulations (DoC)regulations (DoC)

37 CFR 404.4 Authority to 37 CFR 404.4 Authority to grant licenses to federally-grant licenses to federally-owned inventions owned inventions

37 CFR 404.5 Restrictions 37 CFR 404.5 Restrictions (on) and conditions for (on) and conditions for granting licensesgranting licenses

37 CFR 404.1037 CFR 404.10

Modification and Termination Modification and Termination of Licensesof Licenses

Patent TrendsPatent Trends

A 2003 study shows that from 1976 to 2002, the number of A 2003 study shows that from 1976 to 2002, the number of patents issued each year to all federal agencies and patents issued each year to all federal agencies and laboratories remains essentially unchanged.laboratories remains essentially unchanged.

The total number of patents in all sectors grew about 140 The total number of patents in all sectors grew about 140 percent over this period.percent over this period.

For U.S. Universities issued patents increased 1,164 For U.S. Universities issued patents increased 1,164 percent over this period.percent over this period.

Federal Labs as USPTO CustomersFederal Labs as USPTO Customers

U.S. private sector patents consistently averaged 95 U.S. private sector patents consistently averaged 95 percent of the total issued patents to all U.S. based percent of the total issued patents to all U.S. based institutions.institutions.

The number of patents issued each year to the Federal The number of patents issued each year to the Federal agencies and laboratories remained essentially unchanged.agencies and laboratories remained essentially unchanged.

The number of Federal Labs’ inventions disclosed grew The number of Federal Labs’ inventions disclosed grew from 2,662 in 1987 to 3,909 in 2001.from 2,662 in 1987 to 3,909 in 2001.

Some CaveatsSome Caveats

Per the study, it is not clear whether university filings have Per the study, it is not clear whether university filings have increased. Is the increase in the number of issued patents increased. Is the increase in the number of issued patents a result of an increase in filings?a result of an increase in filings?

Per the study, it is not clear whether the industry filings Per the study, it is not clear whether the industry filings were on the rise or not.were on the rise or not.

Federal Labs as ApplicantsFederal Labs as Applicants

Federal labs have different ways of dealing with the Federal labs have different ways of dealing with the USPTO, i.e., different levels of involvement in patent USPTO, i.e., different levels of involvement in patent prosecution:prosecution: In-house patent application preparationIn-house patent application preparation Contract law firmsContract law firms HybridHybrid

The types of technology coming out of the Federal Labs The types of technology coming out of the Federal Labs are very diverse, e.g., mechanical, electrical, chemical, are very diverse, e.g., mechanical, electrical, chemical, biotechnological.biotechnological.

The core missions of the Federal labs are different .The core missions of the Federal labs are different .

16001600 17001700 21002100 26002600 28002800 36003600 37003700 Total*Total* DesignDesign

New New ApplicationsApplications11 9/30/20049/30/2004

55,40255,402 63,92363,923 71,77871,778 97,38097,380 77,6577,6511

56,73856,738 65,00565,005 508,878508,878 18,45118,451

New New ApplicationsApplications1 1

9/30/20059/30/200562,64462,644 72,69772,697 76,52976,529 115,58115,58

5594,4294,42

5570,35470,354 83,22583,225 586,580586,580 24,53424,534

TC Application Inventory*TC Application Inventory*

1 “New Application inventory” is the number of new applications designated or assigned to a technology center awaiting a first action.

*Total inventory includes applications not assigned to a particular TC, awaiting processing either pre- or post-examination.

TC = Technology Center

*This and the next two slides are from Bob Spar’s presentation at PLCW, April 2006

Patent PendencyPatent Pendency(as of 1/1/2006)(as of 1/1/2006)

Technology CenterTechnology CenterAverage 1Average 1stst Action Action

Pendency (months)Pendency (months)11Average Total Average Total

Pendency Pendency (months)(months)22

1600 - Biotechnology and Organic Chemistry1600 - Biotechnology and Organic Chemistry 23.323.3 33.533.5

1700 - Chemical and Materials Engineering1700 - Chemical and Materials Engineering 20.620.6 29.829.8

2100 - Computer Architecture Software and 2100 - Computer Architecture Software and Information SecurityInformation Security

33.133.1 44.844.8

2600 – Communications2600 – Communications 31.231.2 43.943.9

2800 - Semiconductor, Electrical, Optical Systems2800 - Semiconductor, Electrical, Optical Systems 15.015.0 25.025.0

3600 - Transportation, Construction, Electronic 3600 - Transportation, Construction, Electronic CommerceCommerce 19.819.8 27.527.5

3700 - Mechanical Engineering, Manufacturing 3700 - Mechanical Engineering, Manufacturing and Productsand Products 18.618.6 26.626.6

UPR Total (as of 10/1/2005)UPR Total (as of 10/1/2005) 21.821.8 30.630.6

1 “Average 1st action pendency” is the average age from filing to first action for a newly filed application, completed during October-December 2005.2 “Average total pendency” is the average age from filing to issue or abandonment of a newly filed application, completed during October-December 2005.

First Action Pendency by Art AreasFirst Action Pendency by Art Areas

High Pendency Art AreasHigh Pendency Art AreasPendencyPendency11 (months) (months) Low Pendency Art AreasLow Pendency Art Areas

PendencPendencyy

11

(months)(months)

1640 – Immunology, Receptor/ 1640 – Immunology, Receptor/ Ligands, Cytokines, Recombinant Ligands, Cytokines, Recombinant Hormones, and Molecular BiologyHormones, and Molecular Biology

27.727.7 1620 – Heterocyclic Compounds 1620 – Heterocyclic Compounds and Usesand Uses 16.916.9

1743 – Analytic Chemistry & Wave 1743 – Analytic Chemistry & Wave EnergyEnergy 30.830.8 1752 – Radiation Imagery1752 – Radiation Imagery 12.112.1

2123 – Simulation and Modeling, 2123 – Simulation and Modeling, Emulation of Computer Emulation of Computer ComponentsComponents

39.739.72125 – Manufacturing Control 2125 – Manufacturing Control Systems and Chemical/ Systems and Chemical/ Mechanical/Electrical ControlMechanical/Electrical Control

20.020.0

2617 – Interactive Video 2617 – Interactive Video DistributionDistribution 50.450.4 2651 – Dynamic Information 2651 – Dynamic Information

Storage & RetrievalStorage & Retrieval 16.116.1

2836 – Control Circuits2836 – Control Circuits 24.324.3 2833 – Electrical Connectors2833 – Electrical Connectors 8.88.8

3628 – Finance & Banking, 3628 – Finance & Banking, AccountingAccounting 52.152.1 3612 – Land Vehicles3612 – Land Vehicles 12.012.0

3731 – Surgery: Cutting, 3731 – Surgery: Cutting, Clamping, SuturingClamping, Suturing 30.930.9 3723 – Tools & Metal Working3723 – Tools & Metal Working 10.910.9

1 “Average 1st action pendency” is the average age from filing to first action for a newly filed application, completed during

October-December 2005.

Internal Workings of the USPTOInternal Workings of the USPTO

Too little time, too few examiners, too many applications!Too little time, too few examiners, too many applications! An Examiner has between 8-15 hours to do one count, i.e., An Examiner has between 8-15 hours to do one count, i.e.,

issue one first office action on the merits (note that this issue one first office action on the merits (note that this includes the searching of the claims).includes the searching of the claims).

Examiners do not get counts for issuing restriction Examiners do not get counts for issuing restriction requirements or second action on the merits (non-final or requirements or second action on the merits (non-final or final) actions.final) actions.

Allowances and abandonments serve as counts.Allowances and abandonments serve as counts.

Internal Workings…cont’dInternal Workings…cont’d

In some arts searches can be very involved and time In some arts searches can be very involved and time consuming, e.g., chemical structures, biotech sequences.consuming, e.g., chemical structures, biotech sequences.

Compact prosecution is emphasized, but does not always Compact prosecution is emphasized, but does not always happen.happen.

Any action on the applicants’ part that would save time for Any action on the applicants’ part that would save time for the examiner is always welcome, e.g., telephonic elections, the examiner is always welcome, e.g., telephonic elections, proposed amendments, agenda for examiner interviews.proposed amendments, agenda for examiner interviews.

There is an emphasis on customer service and cooperative There is an emphasis on customer service and cooperative (rather than adversarial) relationships with the (rather than adversarial) relationships with the applicants/applicants’ representatives.applicants/applicants’ representatives.

Communication and CooperationCommunication and Cooperation CommunicationCommunication

• Interviews with Examiner- can be a win-win Interviews with Examiner- can be a win-win situationsituation

• Focus on Invention with your client and the USPTOFocus on Invention with your client and the USPTO CooperationCooperation

• Open, frank discussionsOpen, frank discussions• Use of USPTO Internal Resources: Practice Use of USPTO Internal Resources: Practice

Specialist/QASSpecialist/QAS ProsecutionProsecution

• Agree on the inventionAgree on the invention• Identify the issues Identify the issues • Work out the claimsWork out the claims

1919

QuestionsQuestions

OTT/NIH ContactsOTT/NIH Contacts

NIHNIH http://www.nih.govhttp://www.nih.gov

OTTOTT http://www.ott.nih.govhttp://www.ott.nih.gov

Science. Ideas. Breakthroughs.