America-Israel Patent Law

Good Idea, Bad Implementation? ILPTO Changes Procedure for Suspending Examination of Patent Applications

We’ve blogged before about the ILPTO’s policy for suspending examination of patent applications.  In particular we noted how its collection of fees for such suspension is ultra vires, and how a better approach, within the ILPTO’s authority, would be allow applicants to delay their response to pre-examination letters by up to 36 months instead of just 6 months, thereby effectively implementing a delayed examination scheme while legally collecting extension fees.  Such an approach would allow the ILPTO to focus its resources on examining those cases that actually matter to applicants.   

The ILPTO still hasn’t adopted such a scheme.  But it has evidently decided to tweak the existing framework.  Specifically, hitherto (at least for approximately the last 10 years), after an applicant filed its response to the ILPTO’s pre-examination letter, but before the issuance of a first OA, an applicant would request suspension of examination for X months. The ILPTO would then say, “Ok, you can have your suspension, you have one month to pay the suspension fee”.  But given the lag that usually occurs between filing the pre-examination response and the issuance of a first OA – a lag that in some cases can be more than a year – it was never clear if an applicant was paying for a suspension that might have occurred anyway. 

This left applicants desirous of suspension with a choice: wait to request suspension, at the risk of receiving a substantive OA which would, under the ILPTO’s policy, preclude a request that examination be suspended; or request and pay for suspension shortly after filing the pre-examination response, at the risk of paying for a suspension that would have occurred regardless.

Apparently in response to one or more complaints about this, the ILPTO decided that a change was in order.  However, we learned of the change not via a “Commissioner’s Circular” letter or an ILPTO “notice” posted on the ILPTO’s web site and circulated via the ILPTO’s email distribution list, the normal channels by which this would happen.  Rather, we learned about it when we recently requested suspension of an application, and received the following reply from the ILPTO (with identifying information redacted):

1. We confirm receipt of your request to suspend examination of the above-referenced application from the date above.
2. Your application was filed on [date of national phase entry], and the team in [technology area X] to which this application has been assigned, is presently examination applications that were filed in [month/year].
3. Therefore, the suspension will take effect from the moment that the application’s turn for examination arrives, and you are requested to make payment for the suspension at that time.
4. Please note: these figures and the advancement of examination in this team may be also be checked in the examination advancement file on the ILPTO’s web site, and you may avail yourselves of it.

What we gathered from this letter was that we don’t have to pay any fees just yet.  But would the ILPTO warn us when the application was coming due for examination?  Or was it warning us, ominously, that we need to track the examination queue ourselves – something that’s more guesswork than science, since the “examination advancement file” is only published by the ILPTO quarterly? 

We tried contacting the person whose name appears on the letter, but her phone is either out of commission or permanently off the hook; and she didn’t respond to our email inquiry.  So we spoke to some examiners and learned that they’ve been given as much guidance in this matter as applicants have, i.e. none.  Fortunately, we spoke with the head of the team to which this application was assigned, and after discussing the matter with the ILPTO's chief examiner, the team head told us that (a) he won’t further assign this case to a specific examiner until the matter of the suspension is resolved (he doesn’t want his examiners wasting time examining worthless applications any more than our clients want to spend money prosecuting applications that eventually prove to be worthless) and (b) the chief examiner told him they’ll adjust the policy to request payment shortly before the commencement of examination, but applicants should still independently monitor the status of applications.

Assuming the ILPTO gets in the habit of sending suspension payment demand letters before examination begins, we still wonder what will happen when such a letter mistakenly isn’t sent, and an OA then issues before the applicant has paid a suspension fee – will the ILPTO still allow the applicant to pay the fee and suspend examination?  Or what if the applicant decides to pay the suspension fee immediately – will the ILPTO tack on the suspension period only when the application’s turn actually comes up in the examination queue, or will it run from the date of payment, thereby possibly going to waste?

All in all, while the ILPTO is trying to achieve a desirable result, the way in which its doing so creates more work and more uncertainty for both the office and applicants.  And it doesn’t resolve the problem of the office collecting fees it’s not authorized to collect.  So we’ll say it again: just allow applicants to take 36 months’ extension to respond to pre-examination letters rather than 6 months.  This will be less work for everyone; and it will still allow the ILPTO to collect fees, but to do so in an unquestionably legal manner.

Why We Do Our First Filings Outside of Israel

Israel does not require patent applicants to file first in Israel (unless their inventions concern certain defense or nuclear technologies).  And as a result, more often than not the first application gets filed outside of Israel.  In our office, that first filing is almost always made either at the USPTO (as a provisional application) or at the UK patent office.  The choice between the two is based on whether or not the applicant wants an examination report (i.e. a search) before the end of the priority year.    

The fact that most first filings for Israeli inventive entities are made outside Israel has not been lost on the ILPTO.  Thus, in an attempt to compete with the UK for “quick examination” applications, a few years ago the ILPTO announced that Israeli applicants who first file in Israel can use that fact as a basis for expediting examination of their applications.  But that hasn’t really resulted in much change in the pattern of first filings being made outside Israel.  Neither has the introduction of a small entity fee reduction in Israel. 

I recently heard a high-level ILPTO official voice some dissatisfaction with present state of affairs, wishing that more Israeli applicants would file first in Israel and utilize the expedited examination route.  The following is my explanation for why those of us who counsel our clients to file abroad first do so, but it can be summed up in three words: ease of use.  Or, more user-friendly.    

 

1. No declarations necessary

In order to avail oneself of the expedited examination program in Israel under section 19A(a) of the statute, one has to provide a declaration giving the reasons why expedited examination is being requested, such the fact that the filing is Israel is the first filing worldwide.  In order to establish one’s entitlement to small entity status, one has to file a declaration certifying that the applicant meets the criteria for that status.  Such declarations require signing before a lawyer or patent practitioner.  The preparation of those declarations raises the cost of requesting expedited examination.

In contrast, to obtain a quick examination at the UKIPO, one need not provide a declaration of any sort, but merely to pay a search fee and optionally examination fee upon filing, and and voila! Within about six months, you’ve got an examination report.  If you want it faster, tell them, and they’ll probably oblige.

Similarly, to obtain small entity status at the USPTO, one need file no special papers.  You just pay the provisional filing fee at the small entity rate.  The USPTO assumes that the potential penalties to the applicant and the individual practitioner for deliberately lying about small entity status (unenforceability of the patent, suspension from practice or disbarment) are a sufficient deterrent to false small entity claims.

 

2. No extra fees

Expedited examination at the ILPTO also requires payment of an additional fee, beyond the regular filing fee, which is not refundable if the request to expedite is denied.  And if the request to expedite is granted, there’s yet another to fee to pay.  No such fees are required at the UKIPO – you just pay the various filing, search and examination fees, and the UKIPO will act quickly on its own. 

 

3. Lower fees

The current fee for a US provisional is $280, $140 for a small entity.  The fee at the UKIPO, with a request for examination, is £385, or about $510; it’s only £285, or $380, if you only request a search, and a mere £60 if you’re just looking for a filing date without a search or examination.  The fee for filing a new Israel patent application is 2014 shekels, about $560 (reduced by 40% to $336 if you’re a small entity), the fee for requesting expedited examination is 300 shekels, about $83 (no small entity discount), and the fee for instituting expedited examination is 699 shekels, about $195 (no small entity discount available).  You do the math. 

 

4. Simpler process

To file a US provisional, you log in once, upload your materials, click “submit” and pay the fees. 

To file a UK application with a search and optionally an examination request, you or your UK associate log in once, file your documents and pay your fees. 

But to do an Israel request for expedited examination, even if you submit the request to expedite as part of the initial filing of the patent application, and you pay the request fee with the initial filing fees, you’ll still need to log in again, because if the request to expedite is granted, you have to pay another fee to actually cause the application to jump the front of the queue.  That’s another round of things to docket and a fee to pay. 

Note also that, unlike the USPTO, the ILPTO doesn’t provide the option of storing credit card data – you have to enter that data every time you pay by credit card.

 

5. Lack of PDAS Accessibility

If you file a US provisional application, by default your application will be available via PDAS, so that when you later file a PCT claiming priority from the provisional, you can tell WIPO to obtain a copy of the priority application, which it will dutifully do.  No mess, no fuss.

The UKIPO is also part of PDAS.  Put in the right information on your PCT Request, and WIPO does the rest. 

Not so the ILPTO.  If you file first in Israel and later file outside Israel, or file a PCT application using any Receiving Office other than the Israel Receiving Office, you’ll need to order a certified copy of that first-filed Israel application and then provide it (probably via FedEx or DHL) to the relevant patent office.  Another administrative task to worry about and additional expense to incur.

 

6. Certainty of non-publication.

A US provisional application will never be open for public inspection unless a follow-on US or PCT application claims priority from that provisional.  At the UKIPO, one can abandon the application and it will not publish.  In contrast, while in principle one can tell the ILPTO to abandon an application so that it doesn’t publish, the ILPTO doesn’t always follow those instructions, as we reported here.  So if you’re unsure about whether you want to proceed down the patent route or attempt to maintain a trade secret, or even just to reset the Paris Convention clock and re-file your application, you’re safer doing it with a US provisional or a UK application.

 

7. More user-friendly electronic filing

Immediately upon filing, the USPTO’s electronic systems gives an e-filing receipt that shows the application number, the fees paid, and names and sizes of the documents filed.  And normally within minutes, the newly-filed application is visible in private PAIR.

In the UK, you can print of screen of everything you’re filing, and you can tell the UKIPO to email you the filing particulars and copies of the documents, which it will do within minutes of filing.

Then there’s the Israel electronic filing system.  If you don’t pay fees, you can ask the system to send a confirmation that something was submitted, but that confirmation won’t list the application number or the names or sizes of the documents filed.  If you pay fees, you can’t even ask the system to email you a filing confirmation, because the system kicks the user out of the filing system into a separate payment system, which doesn’t allow the user to back to the filing system. 

Whether one pays fees or not in Israel, one has to wait at least 10 minutes, usually at least an hour and in some cases considerably longer than that, to be emailed a filing confirmation.  The confirmation document itself only lists the application number, not the documents submitted.  Instead, the ILPTO emails those documents back to the user (or, if they’re particularly large, emails a link to a site to download the documents that the user recently uploaded). 

And it can take over 48 hours for the materials to appear in the ILPTO’s database in the case of already-published application; but since there’s no private PAIR function at the ILPTO, one can’t even see one’s own new application in the database.  That ability will only come when the application is published at 18 months and becomes visible only to everyone, not just the person who filed it.

 

So given all that, why would anyone want to file first in Israel?

There is one situation in which I can see an applicant regularly filing first in Israel in order to obtain an early examination report, and that is where the applicant is one of the universities (or the university tech transfer office).  The universities qualify as small entities, and since they are repeat players in that regard, they can prepare a single declaration to that effect.  Since they have in-house counsel, obtaining a declaration that a given filing is the first one worldwide doesn’t cost them additional money.  And in many cases, they won’t file a PCT unless there’s a commercial partner who’s footing the bill for things like obtaining certified copies of the priority application.  So for these and other reasons, it may make sense for the universities to file first in Israel. 

As for the rest of us, though, until it becomes easier and less costly to get our applications examined quickly in Israel, filing first elsewhere will continue to be the norm.

On National Security Review, The ILPTO Has The USPTO Beat

There’s a thread today on Carl Oppedahl’s EFS listserv about the processing of new US patent applications being delayed while a national security review takes place. Many people may not realize it, but every US patent application is reviewed to see if its publication, and dissemination outside the US, should be forbidden on national security grounds. The overwhelming majority of applications, of course, aren’t flagged; this is reflected in the filing receipt issued by the USPTO, which says, “Foreign filing license granted.”

Such review makes sense for applications originating in the USA. What has been pointed out in the discussion in the listserv is that this review is also conducted for applications that originate outside the US and then enter the national phase of PCT. Such applications, if filed at the 30 month deadline (as nearly 100% of them are), have already been published by WIPO 18 months after the priority date, i.e. a full year before national phase entry is effected in the USA. In such circumstances, what’s the point of reviewing such cases? Conducting such review in such cases is a complete and total waste of time and money.  Moreover, what's the point in telling the owner of a foreign-originated application that it's ok for him to file outside the USA?

Carl posited that the USPTO conducts such review because someone at the USPTO said, “All cases will undergo review” and that no one in the USPTO wants to say that the emperor has no clothes, because (a) the USPTO itself republishes those national phase applications after filing, (b) in many instances, this will be the first English-language publication of a previously-published PCT application, and (c) no employee wants to be the guinea pig for the “it already published in a foreign language” defense if a foreign-originating application is published by the USPTO and some nitwit at DOD says, “You shouldn’t have published that”.

It appears that on this score, the ILPTO has the USPTO beat by a mile (1.61 km for you metric speakers). The ILPTO also reviews applications for national security issues, but it only reviews locally-originating applications, over which it has jurisdiction. Moreover, not only does the ILPTO not waste time reviewing national phase PCT applications, but it usually makes those applications publicly available within about two months of filing. Contrast this to the USPTO, which takes at least 18 months from national phase entry, and sometimes longer, to publish national phase applications.

Perhaps we shouldn’t be surprised by the USPTO’s wasteful behavior. This is the same country whose defense department gave us the $37 screw and the $640 plastic toilet seat (those are 1980’s numbers). Charging patent applicants for worker time to unnecessarily review already-public documents to see if they should be subject to a secrecy order just seems to be business as usual.

Has The ILPTO Been Collecting Suspension Fees Illegally? A Proposal For Deferred Examination In Israel and Legal Collection of Fees

Over the course of the past 10 years or so, the ILPTO has been moving in the direction of speeding up examination of patent applications. Most noticeably, the ILPTO has significantly increased the number of examiners, but it has also put procedural mechanisms into place to ensure that the queue of applications keeps moving along.  The most obvious among these procedural mechanisms have been the adoption of limits on the total amount of extension time that may be obtained during substantive prosecution; and the restricting of the time at which suspension of examination may be requested (to a brief window before the commencement of substantive examination), as well as the limitation of the duration of such suspension (now, unofficially, down to one year maximum). 

At a meeting in March 2016 between an AIPLA delegation and Commissioner Asa Kling, he indicated that by the end of 2017 the office was slated to increase the examiner pool by nearly 50%, from about 100 to about 150.  I pointed out that employees cost money, and a less expensive solution to hiring additional examiners would be to facilitate a delayed examination scheme, similar to what exists in Canada, Japan and many other countries.  Under such a scheme, an applicant would be given a period of several years in which to file a request for examination.  If no such request was filed within the period, application would be deemed abandoned.  This way, the ILPTO would only have to examine those cases that were actually of interest to the applicant after the set time period; presumably, a certain percentage of cases would thus fall by the wayside, obviating the need for examination and the examiners to conduct that examination.

Mr. Kling’s response was evasive: Effecting such a change in procedure would require a statutory amendment, he said, adding, rhetorically, Do you know how long it would take to get such a change enacted?

I disagree with that view: I think there’s a way to implement delayed examination under the existing statutory framework. Moreover, I think that the ILPTO’s current practice of collecting a fee for suspending examination has no legal basis; but my proposal would enable the PTO to continue to collect those fees in a legal manner.  Specifically:

As noted, presently the ILPTO will let an applicant request a suspension of examination at one and only one stage of prosecution: after responding to the pre-examination letter (essentially an IDS submission requisitioned by the ILPTO) and before the issuance of a first substantive office action on the merits of the case.  Although it’s not written anywhere, the ILPTO will limit that suspension to one year. And – here’s the kicker – it makes the applicant pay for that suspension. 

I call that a “kicker” because the Commissioner is authorized to charge applicants for extensions. But extensions are needed when an applicant responds to the ILPTO.  Here, the applicant has already responded to the pre-examination letter, so there’s nothing outstanding due from the applicant.  Which means that, even though the ILPTO calls this fee an “extension” fee, in fact there’s no extension whatsoever involved.  Which in turn means that the ILPTO is acting illegally in collecting a fee it’s not allowed to collect.  In view of the fact that the ILPTO was sued a few years ago for collecting fees for actions it didn’t subsequently take, you’d think it would be sensitive about these things, but apparently not.

What I propose is to use the commissioner’s extension power to implement a de facto deferred examination program – and to simultaneously legitimize its collection of fees for suspension.  The procedure is pretty simple: instead of making applicants request suspension after responding to the pre-examination letter, the Commissioner should just say that he’s willing to grant a long period of extension – say somewhere in the 36-44 month range – beyond the statutory four months that applicants have to respond to the pre-examination letter.  This is well within the Commissioner’s power.  The ILPTO could collect extension fees for this period; this is also within the commissioner’s power.  Ta-da!  You now have a deferred examination regime – one that’s legal in all aspects, and that preserves the office’s ability to collect fees.

The effect of this would be to allow applicants to decide when, if at all, they want substantive examination to begin, within a defined window.  If and when they want substantive examination to commence, they would pay the extension fee due and respond to the pre-examination letter, and the office would begin substantive examination.

Mr. Kling reportedly has only a few more months left in office. This is a step he could implement immediately, to good effect.  I urge him to take it.