The year 2006 was a remarkable year for the patent community in the United States. Jon Dudas was the Director of the USPTO then, and in the USPTO’s annual report, he reported that the allowance rate had been successfully reduced to 54 percent. In the annual report Director Dudas stated, as a matter of some pride, that “at 54 percent, the patent allowance rate was … the lowest on record.”
2006 was also the year in which Mr. Dudas launched the Accelerated Examination program for patent applicants. Now in 2017 it seems likely the AE program will be brought to a close.
At the time that Director Dudas, AE was one of only a small number of ways to get a patent application examined fast. The AE program (see MPEP 708.02(a)) asked a lot of the applicant.
A first requirement for AE was that the practitioner needed to carry out an AE search. What was an AE search? An AE search was (exaggerating only slightly) a search everywhere in the world, in every database, including all patent databases and all non-patent literature databases, carried out so diligently that the practitioner was able to file a signed statement with the USPTO stating that no reference pertinent to patentability had been overlooked.
USPTO people have been quoted as saying that the search carried out by an ordinary USPTO examiner in an ordinary US application would not satisfy all of the requirements of an AE search.
Ten years after issuance, when the AE patent is being litigated, it is safe to assume that the signer of that statement will be deposed at length. It is also safe to assume that the adversary will have little difficulty uncovering real or imagined lapses in the quality of the AE search, and will have no difficulty at litigation time finding myriad references that are argued to be pertinent to patentability and that were not found in the AE search.
Returning to the requirements for AE, the practitioner was also required to prepare and file an AESD (Accelerated Examination Support Document). For the AESD, the practitioner was required essentially to write the first Office Action for the Examiner. This portion of the AESD would identify the references from the AE search that the practitioner felt were most relevant, and applied those references against all of the claims, with an element-by-element exegesis of each claim, explaining why the invention is not patentable.
The next part of the AESD which the practitioner was required to prepare was a rebuttal of every point that the practitioner made in the first part of the AESD.
Simply put, in the first part of the AESD, the practitioner was obligated to explain in detail exactly why the invention was unpatentable, and then in the second part of the AESD, the practitioner was required to explain in detail why the practitioner was mistaken when the practitioner said the invention was unpatentable.
Ten years from now in litigation, it is safe to assume that the adversary will find many real or imagined flaws in the AESD. The author of the AESD will be deposed at length about the document and why it did or did not present this argument or that argument. It will be urged that the practitioner held back and did not really present the strongest arguments for unpatentability but only presented weaker arguments. It will be urged that in the rebuttal portion of the AESD, the practitioner misled the Examiner when explaining why the invention really was patentable.
At litigation time, it would not be at all surprising if the adversary were to succeed in invalidating some or all claims of an AE patent. Were this to happen, it would not be at all surprising if the client were to try to blame the practitioner for having recommended AE in the first place.
AE imposed many other burdens on the applicant and on the practitioner. To use AE, the application was limited to three independent claims and twenty total claims, with no MDCs (multiple dependent claims).
To use AE, the applicant was required to promise in advance not to traverse any restriction requirement, no matter how unjustified it might be. The applicant was further required to promise in advance that if the applicant were to appeal, the applicant would not separately argue patentability of any claim. Said differently, the applicant was required to concede in advance that upon appeal, the claims would stand and fall together.
My feeling was that for an AE case, the AE search and AESD would surely run up a bill of at least ten thousand dollars (above and beyond the expense of preparing the patent application), and for subject matter of some technical complexity, the extra cost for AE would add up to at least twenty thousand dollars. It also seemed to me that in addition to a bill for the time spent preparing these documents, a practitioner would be smart to increase the bill so that enough money is collected to reflect the increased risk of later being accused of malpractice for having participated in the AE program.
In my view, the AE program was risky for the practitioner, and risky for the applicant. During the eleven years that AE was available, it was the formal policy of my patent firm that we would never participate on a client’s behalf in the AE program.
I am, it seems, not the only person who thought that it would be a big mistake to participate in AE. At its highest level of participation, there were never more than a couple of hundred AE cases per year, meaning that the participation rate was far less than one-tenth of a percent of filed patent applications. Gene Quinn noted the low AE participation rate in an IP Watchdog article in August of 2016.
On January 12, 2017, the USPTO published a Federal Register notice proposing to scrap the AE program. Comments are due by March 13, 2017. I predict that the number of filed comments urging retention of the AE program will be zero.
What is unfortunate now about the AE program is that USPTO never did any rulemaking for the program. This means that the scrapping of AE will not result in a cancellation of any rules which would then be exchangeable under President Trump’s January 30, 2017 “two for one” executive order. This is the executive order which, it will be recalled, says that before an administrative agency can promulgate a new rule, it must cancel two existing rules.