America-Israel Patent Law

Licensure of Patent Practitioners (2) – Why Does the USPTO Discriminate Against U.S. Citizens?

In order to represent others in patent matters before the USPTO, one has to be admitted to such practice by the USPTO, even if one is already a lawyer admitted to a state bar.  Practicing in patent matters on behalf of others without a license can result in fines (35 U.S.C. §33) or, if false statements are involved, imprisonment (18 U.S.C. §1001).  Yet at the same time that U.S. citizens are required toe the line, pay for and pass the USPTO registration examination, and follow the USPTO’s rules in order to represent clients before the USPTO, the USPTO allows foreign citizens to practice before it without a license and without the threat of repercussions. 

  

How does this come about?  Well, the first thing one needs to do is acquire a USPTO customer number.  Although typically one or more practitioner numbers are associated with a customer number, you don’t need a practitioner number to get a customer number, and you don’t need to provide a U.S. address.  So if you’re a foreign practitioner registered, in say, Israel, but not registered in the USA, you can still get a USPTO customer number, e.g. 36131 or 63426. 

  

Next, you tell your clients that they can save money by avoiding the use of a U.S. associate and filing directly at the USPTO.  Since you yourself aren’t licensed to practice before the USPTO, you can’t sign the papers on their behalf; maybe you tell your clients this piece of information, maybe you don’t.  It doesn’t really matter, since any inventor can act pro se, so you can pull a fast one the USPTO: you prepare and file all the forms and substantive papers yourself, but you have the inventor(s) sign the papers themselves (maybe; see discussion below), so that, to the USPTO’s eyes, it appears that the inventors are prosecuting their own applications.  Of course, there’s the minor fact that the customer number associated with the filing of the papers has a name and address that are completely different from the name and address of the inventors, but it never crosses the mind of anyone at the USPTO that the person whose name is associated with the customer may de facto be acting as the agent for the inventors. 

  

Even better, it appears that no one at the USPTO checks to see that the papers are actually signed, so you don’t really need to get the inventors’ signatures.  You can just type their names on the papers in your word processor, and put slash marks in front and after the typed named.  Under 37 C.F.R. 1.4(d)(2), that counts as an “S-signature”, and is, apparently, acceptable.  So if you look, for example, at the inventor’s declaration filed in USSN 11/619629 (20070159626), the declaration wasn’t signed by the inventor; the form was filled out and submitted by the person associated with customer number 36131, who is neither the inventor nor a practitioner registered before the USPTO.  One wonders if the inventor ever saw the declaration before it was filed.

  

Actually, in some cases, why bother even pretending the inventor is directly involved at all?  If you’re filing a provisional, for which no declaration is required, you can do everything yourself.  Thus, for example, provisional application no. 60/597171, which served as the priority document for USSN 12/088096 (20080265144), was filed using a transmittal form in which the person submitting the correspondence admitted that the use of the electronic filing system “is for OFFICIAL correspondence between patent applicants and their representatives and the USPTO.  Fraudulent or other use besides the filing of official correspondence by authorized parties is strictly prohibited, and subject to a fine and/or imprisonment under applicable law.”  However, the person submitting the paper was neither the applicant nor a person authorized by the USPTO to represent others in patent cases.

  

Or maybe you can actually get the inventors to sign a power of attorney appointing you to prosecute their application, even though you’re not a registered practitioner.  That’s what happened in USSN 11/657079 (20070173385).  Actually, in that case, the applicants listed their Israeli attorney (who is not licensed before the ILPTO or the USPTO) as one of the inventors.  Whether or not he actually constitutes an inventor under U.S. law is anyone’s guess, but it’s a moot point, as the application went abandoned.  That may have had something to do with the well-written claims, which were rejected inter alia as being indefinite for claiming both an apparatus and the method steps of using the apparatus:

  

1. A method and device comprising

a) a system of weights that is removably attachable and adjustable to fit a body or part of a body,

b) the said weights attached in such a way that are in contact with the said body or said part of the body and

c) a means to fill and to empty the said weights with substances wherein the said weights are adjustable in size and in number,

whereby the said weights will strengthen the muscle, flesh or bone of the said body or part of the said body, and/or lose fatty tissue from the said body or part of the said body.

  

Of course, as a way of running your practice, listing yourself as an inventor when you’re probably not one under U.S. law (see, e.g. publication no. 20070169254) presents the minor problem that the validity of any patent issuing from the application is in question, but if your clients are a bunch of foreigners who don’t know any better and they pay, what do you care?  

  

Or you can forego listing yourself as an inventor altogether, and just file a POA in which you’re appointed by the inventor, even though you yourself aren’t a licensed practitioner.  (See e.g. 20070113993).  The USPTO doesn’t check anyway, does it?  I mean, you’ve got a customer number, right?  That should be good enough.

  

Moreover, looking at some of these applications, they’re pathetic.  It’s not just that they’re pathetically written.  It’s that the “inventions” described are so obvious, the applications should never have been filed in the first place.  Look, for example, at 20070008183: put a recorder in a car that records how fast a car traveled from point A to point B, to provide the police with evidence of speeding.

  

In view of this, my question is, why did I bother to take and pass both the USPTO and New York bar exams?  Being licensed in both places puts constraints on me: I have to worry about ethics rules, and I have to be concerned about defending myself against unfounded charges of inequitable conduct if I make an honest mistake and don’t IDS some reference of questionable materiality.  But if I were just Joe Shmoe foreign citizen, I could have just gotten myself a USPTO customer, and I could now de facto be representing clients before the USPTO with impunity, without fear of reprisals for any malfeasance on my part.

  

Maybe this is just another variation of the maxim, no good deed goes unpunished, and I, like thousands of other registered practitioners, was a sucker for getting my USPTO registration number.  But, cynical as I sometimes am, I would still hope that USPTO would take steps to prevent such behavior, and to stop punishing those of us who play by the rules.  Letting non-registered practitioners practice before the USPTO cuts into our livelihood; it also deprives some inventors with genuinely good ideas competent representation before the USPTO. 

  

My suggestion for what the USPTO could do to clean up this mess?  It should require:

  

(a)        in the case of a lone inventor, either the address associated with customer number is the same as the address of the inventor, or there is at least one registered practitioner associated with the customer number; and

  

(b)        when there are joint inventors, either all the inventors are associated with the customer number (and not just one inventor is associated with the customer number), or there is at least one practitioner number associated with the customer number. 

  

I don’t know how much of a headache it would be for the USPTO to implement this, but it would go a long way toward preventing unwary overseas applicants from being duped.

Israeli Progressiveness, Israeli Self-Flagellation

Anyone who has been even marginally associated with patent world in the last few years is aware of the severe backlog in patent examination at the USPTO.  The Director of the USPTO under the previous administration tried to remedy this by forcing through rule packages that would have made it difficult for even the most worthy applicants to gain allowance of their patent applications.  The rules were challenged by Dr. Tafas, a solo inventor, and by SmithKline Beecham, one of the world’s largest pharmaceutical companies, in Federal District Court in the Eastern District of Virginia.  In April 2008, the district court struck down the rules as exceeding the USPTO’s authority, ruling that the rules were substantive rather than procedural. 

 

Two days ago, at the behest of the parties, an en banc Court of Appeals for the Federal Circuit dismissed the appeal of the case, vacating an earlier appellate panel decision but leaving the District Court decision in place.  The result is that not only are the new rules out the window, but also, as a practical matter, the USPTO Director will be unable to try to pull the same stunt in future, unless Congress grants the Director substantive rule-making power.

 

The jury is still out on the current USPTO Director, David Kappos, who took over the job a few months ago, but his willingness to dismiss the rules packages that prompted the Tafas suit is promising, and so far he seems willing and able to think outside the box (insofar as possible in the context of a large government office saddled with government employees and government employment rules). 

 

When it comes to the examination backlog, thinking outside the box is undoubtedly what is required.  As Professors Michael Abramowicz and John Duffy note in a recent article, the basic problem is the underlying assumption that every patent office needs to substantively examine each patent application that comes its way.  As national economies become increasingly intertwined, and more companies file more patent applications in more countries, that assumption becomes impractical; even large countries cannot justify the large expenditure of resources to examine every application thoroughly and quickly.  Most of the article is devoted to setting forth a model which, according to the authors, would enable the job of patent examination to be outsourced to the private sector.  Before doing so, however, the authors also note that worksharing among patent offices is another potentially viable solution for increasing global patent examination efficiency.

 

In this connection, the authors point to Israel as being progressive.  Israel is a substantive examination country, or at least it tries to be.  But Israel, while technologically advanced, is a small country, and cannot devote the resources necessary to thoroughly yet timely examining all the patent applications filed at the ILPTO.  That it has neighbors whose idea of friendly relations is blowing up civilian buses or firing missiles at day-care centers further depletes the resources available for activities like patent examination.  So since the 1980’s, Israel has allowed applicants to piggy-back the examination of an Israel patent application on the grant of a corresponding patent in certain foreign jurisdictions, principally the USA and the EPO.  Although initially adopted as a procedural rule by the ILPTO, in 1995 this practice was codified into law as §17(c) of the Patents Law.  Over the years, the Commissioner has made it even easier to utilize §17(c), by deeming a Notice of Allowance (rather than the actual ministerial act of the patent grant, which can occur months later) or a favorable PCT examination report to be sufficient grounds for implementing §17(c).

 

From the ILPTO’s perspective, §17(c) practice works.  §17(c) is widely utilized by applicants seeking to lower global patent prosecution costs; and with the hiring of dozens of new examiners in the last several years, the examination backlog at the ILPTO has been reduced.

 

I used to think of §17(c) as simply a way for Israel to externalize the cost of examination, placing the burden on the EPO and USPTO and then reaping the fruits of their labors.  But as Abramowicz and Duffy note, if enough patent offices raise their quality of examination to mutually acceptable levels, worksharing among national offices can facilitate a reduction in the duplication of efforts, resulting in overall greater global efficiency in patent examination.  Perhaps, now that Israel has been authorized to become a PCT search and examination authority, Israel will be able to carry its fair share of the global patent examination load; I may discuss this a bit in a future post.  In any event, as long as there are other patent offices conducting sufficiently good examination, there is no reason not to rely on the results of those examinations.  And, as a famous twelve-step self-help program notes, the first step on the road to recovery is admitting you have a problem.  At least Israel was willing to admit it couldn’t handle the examination workload, and that the solution was not to stop granting patents (as the USPTO under the previous Director tried to do with its now-defunct rules package and “quality = reject, reject, reject” mantra).

 

What does this have to do with the self-flagellation in the title of this post?  Well, there seems to be a certain segment of the Israeli population that believes that Israel can’t possibly do things as well other developed countries.  In the patent examination context, this means that they will poo-poo the ability of the ILPTO properly examine cases.  Thus, for example, in an Israel Supreme Court decision from around 20 years ago, the Court said, “In Israel, as opposed to the United States, the examination of an application and the grant of a patent are no guarantee that the patent is valid (§37 of the statute).  The examination performed by the Patents Commissioner in accordance with §17 of the statute is not done in a diligent and thorough manner”. 

 

I mention all this because of a discussion I had a few months ago with one of Israel’s leading IP litigators, who asserted that (a) patents examined by the Israel PTO shouldn’t be accorded any deference, because the ILPTO is incompetent, but (b) patents granted through the 17(c) process should be afforded even less deference because they weren’t substantively examined by the ILPTO. 

 

It’s rather disconcerting when the country’s highest court takes such a dim view of the work of its patent office – particularly when it turns out that at least some of the local examiners do at least as good if not a better job of examination than their counterparts in the U.S.A.  It’s even more disconcerting when local litigators seize on outdated court statements like the one above to besmirch the local examination process per se, and to try to undermine the validity of all granted patents on the grounds that Israeli examination as a whole is deficient – especially if they’re going to ignore improvements in local examination and draw comparisons to U.S. examination, which these days is as spotty as Israeli examination.  (Applications in Israel are for the most part filed in English; but I’m not sure which patent office, the USPTO or the ILPTO, has a higher percentage of native English speakers in its examining corps.)

 

But in my view it’s absolutely unconscionable, not to mention logically inconsistent, for local litigators to assert, on the one hand, that the ILPTO is itself incapable of conducting good examination, and to assert, on the other hand, that patents granted via the §17(c) procedure should be afforded even less deference than those granted after substantive examination by the ILPTO.  If the ILPTO is incompetent in comparison to certain other patent offices – a suspect assumption – then we are no worse off by relying on the findings of those offices in making patentability determinations. 

I take some comfort in observing that, unsurprisingly, the ILPTO has rejected the notion that a patent granted under §17(c) is necessarily weaker than one substantively examined by a local examiner.  The Commissioner has had plenty of opportunity to observe the operation of both his own corps of examiners as well as the products of other examination systems, and is well-positioned to assess which patent-granting regimes are the best ones.  Nevertheless, my litigator acquaintance’s assertion that §17(c)-granted patents are weaker than those examined by the ostensibly weak Israeli examining corps continues to disturb me.  It is a thinly-veiled way of saying that there are no valid patents, and I am sure he will advance this argument before the courts when it suits his purposes.  If this position is ever adopted by the courts, it will mean victory for the Luddites and be a blow to Israeli innovation.  And an even more egregious example of Israeli self-flagellation.

Yes to software patents? No to software patents? Israel PTO thinking of reconsidering position on software patents

This morning the Israel PTO published a call for position papers regarding software patents.  The text of the notice, translated into English, reads as follows (the original appears at the end of this post):

This morning the Israel PTO published a call for position papers regarding software patents.  The text of the notice, translated into English, reads as follows (the original appears at the end of this post):

 

“The Patents, Designs and Trademarks Authority is interested in determining if there is reason to reexamine its policy regarding the examination of patent applications in the fields of software and hardware.  We hereby announce a call for the submission of position papers in the matter.  The Authority invites the public to send position papers until February 15, 2010 by electronic mail to [email protected] by post to Lihi Zoaretz, Israel PTO, 29 Agudat Sport Hapoel St., The Technological Park, Building 5, Malha, Jerusalem.  Position papers should be one-and-a-half spaced and run not more than four A4 pages.  The Authority has absolute discretion if and how to act as a result of this call for papers and/or any position papers that are submitted.”

 

At present, ILPTO policy regards software per se as unpatentable, but it may be patentable when claimed in combination with other elements.  The Commissioner has stated that in general, the patentability of “hybrid” inventions, viz. those that employ both hardware and software elements, will hinge on whether the “essence of the invention” is itself patentable.  Thus pure business method claims, having no tie to something the ILPTO considers to be technological, are ineligible for patent protection, but if the business method claim is tied to something technological, e.g. a computerized system, it may be patentable.  The analysis is not to be conducted on the individual elements of the claimed system, but on the system as a whole.

 

Thus, for example, a helicopter fuel control system was deemed patentable by the Tel-Aviv District Court when claimed as a combination of hardware and software elements.  In contrast, “A method for displaying a list of Internet sites, each having a home page, the method comprising: providing a picture of a selected page of each Internet site on the list; and displaying a name of each said Internet site together with said picture of said selected page of said site” was found by the ILPTO to be invalid, since (a) protection for the source code the display was available under copyright as literary and visual works of art, respectively, (b) the claimed invention was merely an idea for content display, and (c) the output of a software program, as content, is not patentable. (The ILPTO also ruled that the claimed invention wasn’t enabled by the specification.) 

 

Similarly, a claim reading, “A method of determining reliability with regard to a first factor which is dependent on a set of at least two second factors, each of the second factors being diversely subject to a third factor, data concerning the second factors being stored in storage accessible to a processor and the method comprising the steps performed in the processor of: using the data to determine correlations between second factors with regard to the third factor; using the correlations in determining a standard deviation of the third factor for the set; and using the first factor and the standard deviation in determining a reliability with regard to the first factor” was determined to be patent-ineligible because the essence of the invention was a business method and an algorithm, and technical elements of the claim were routine and did not constitute part of the essence of the invention.

 

קול קורא להצגת ניירות עמדה בנושא אמצאות טכנולוגיות בשטח התוכנה

 רשות הפטנטים, המדגמים וסימני המסחר מעוניינת לבדוק האם יש מקום לבחינה מחודשת של מדיניותה באשר לבחינות בקשות פטנטים בתחום התוכנה והחומרה. מוכרז בזאת על קול קורא להגשות ניירות עמדה בנושא זה.

הרשות מזמינה את הציבור לשלוח ניירות עמדה עד ליום 15.2.2010 בדואר אלקטרוני לכתובת [email protected] או בדואר עבור ליהיא זוארץ, רשות הפטנטים, המדגמים וסימני המסחר, רח' אגודת ספורט הפועל 29, הגן הטכנולוגי, בניין 5, מלחה, ירושלים.

נייר העמדה יודפס ברווח של "שורה וחצי" ולא יעלה על ארבעה עמודים בגודל A4.

לרשות מסור שיקול הדעת המוחלט אם וכיצד לפעול בעקבות פרסום הקול הקורא ו/או ניירות העמדה שיוגשו.