America-Israel Patent Law

Israel Patent Office Changes Policy On Suspension of Examination…But Still Acts Ultra Vires

I’ve written several times in the past about suspension of patent examination at the Israel PTO (here, here, here and here). In June, the ILPTO announced a new policy for dealing with the suspension of patent examinations. We’ll get to the new policy shortly, but a brief history of suspensions is in order.

There is nothing in the statute about suspending patent examination. So under the sui generis policy that had been in place for many years, as long as no response was outstanding from the patent applicant, an applicant could request suspension at any time, and the ILPTO would set the application aside. Since nothing was outstanding, there was nothing for the applicant to pay.

Then the ILPTO switched gears, and said that suspensions could only be requested after the applicant filed its response to the pre-examination letter that the ILPTO issued under §18 of the statute (which response consists of the submission of an IDS-type document and a list of corresponding applications outside Israel), and before the mailing of the first office action; once substantive examination commenced, no suspensions would be granted. And a fee for each month of suspension had to be paid in order for the suspension to take effect. 

After a few years of that, some applicants realized they were unnecessarily paying for suspensions (since in some cases the suspensions expired before the examiner would have taken up the case anyway), and they complained about it. So the ILPTO again changed its policy, and said that you still had to ask for the suspension before the first substantive OA, but that the ILPTO would mail a request for money shortly before examination was due to start. If the applicant paid the fee, the case would be suspended; if not, the file would be closed for failure to respond.

Now the ILPTO has again changed tack, in two ways. First, while the window for requesting suspension only opens upon the filing of a §18 response, it now closes three months before substantive examination is due to start. And how does one know when that date is? Well, in the ILPTO’s database, for each case for which examination hasn’t yet started, there’s a notice stating that examination is expected to commence in X months. See the screenshot below.

Problem is, that notice doesn’t say from which date those X months are calculated. The priority date? The PCT filing date? The national phase entry date, or the Israel filing date for non-PCT applications? Inquiring minds want to know!

Second, the ILPTO now demands payment of the fee for suspension up front. And what if the ILPTO refuses your request for suspension? You can then request a refund. This is a fun process that in some cases will cost more in attorney time than the value of the fee paid.

Supposedly, in cases in which the suspension is approved and paid for, the system will automatically delay the start of examination by the number of months of suspension.

Apart from putting the onus for tracking the deadline to request suspension on the applicant and requiring payment in advance, the real problem with this system is that the ILPTO is not authorized to collect money for suspensions. As I explained several years ago, the office can collect fees for extensions of time, viz. when the applicant owes the office a response by a certain date and responds after that date. But in the case of suspensions, the applicant owes the office nothing. Indeed, the suspension can only be requested after a response to the pre-examination letter has been filed, viz. when the applicant doesn’t owe the office any response. Apparently the ILPTO wants to get hit with a class-action suit demanding repayment of improperly collected fees.

The better approach, as I outlined previously, is to tell applicants that they have four months to respond to the §18 letter, and that they can extend that response period not by a mere six months (as is the present practice) but by some lengthy period, like 24-36 months. Applicants could then pay the legally required extension fee at the end of the period; if they don’t file a response with the extension fees, the application goes abandoned.  By allowing a lengthy extension period for responding to the §18 letter, the ILPTO would effectively convert the response to the §18 letter into a request for examination, and the suspension period would be converted into a legal extension period. It’s a win-win.

What do you say, ILPTO?

The Saga of Suspensions (or, You Can’t Make This Up, Installment No. 12? 15? I’ve Lost Track)

Once upon a time, the Israel PTO let patent applicants request suspension of examination at almost any point in time during the examination process, and it didn’t cost anything. You just wrote to the office and requested suspension. This isn’t something that’s explicitly set forth in the statute, but it’s no skin off the ILPTO’s back to put a note in its file, “Don’t examine this case yet”.

Then someone at the ILPTO got the idea that this worked too well, so that person decided to mess things up. Maybe someone thought that, in the age of 18-month publication, suspending examination was prejudicial to potential competitors. Maybe someone thought that, “Hey, we can make money off this by charging a fee!” Maybe someone felt that it’s important to keep the Office’s docketing straight and to not let prosecution lag too much. Maybe it was a combination of reasons.

Whatever the case, at some point the ILPTO changed its practice, and said that one could only request suspension after the applicant had answered the pre-examination letter (viz. filed a mandatory disclosure of publications relevant to patentability or cited by examiners elsewhere – think of an IDS in the USA – plus a list of corresponding cases elsewhere, or in brief, a Section 18 response) and before the issuance of the first substantive office action. And then, if the ILPTO said “ok” to the suspension request, applicants would be given one month in which to pay for the suspension.

I’ve written at length in the past about how that suspension fee is unauthorized by statute, but that’s not the focus of this post.

No, what I wanted to get at were further changes to the ILPTO’s suspension practice.

The first additional change happened a little over five years ago. The problem was that you had no way of knowing when the application might be examined, and since you could only request suspension before the first OA issued, it was common to request suspension shortly after responding to the pre-examination letter. And then within a few weeks you’d get the letter to pay the fee, and so you’d pay the fee within a month, and ostensibly the case would be suspended for year or whatever…and then after the suspension was over you’d sit around for another month or six or twelve or more waiting for the OA. Which meant that the fee was totally unnecessary, and that in reality, nothing had been achieved except wasting time (and client money) on some meaningless administrative tasks.

So the ILPTO said, “OK, you still need to request suspension after your section 18 response and before we issue a substantive OA, but now we’ll wait until the application is actually due to be examined, and then we’ll send you a warning letter, and if you pay the fee within a month we’ll suspend and if not the case will go to the examiner.”  Makes sense, although I was apprehensive that the ILPTO might miss overlook the fact that a suspension had been approved and issue an OA before we’d even been asked to pay money.

It turned out that the ILPTO was actually pretty good about issuing the “pay for your suspension now” letters”, and until this week I’d only had one case out of many in which it prematurely issued an OA. And in that one case, it wasn’t a big deal to get that OA withdrawn and have the “pay your fee now” letter sent.

Then last year they surreptitiously changed their “pay your money now” letter slightly. They changed it to say, “If you want the suspension you must request suspension again and pay the fee”.  Now, I admit, I initially missed that new part, and just paid the fee as I always had. But some months later, I looked through my docket and saw a case in which I’d paid the fee but hadn’t gotten the confirmation that the suspension had been granted. So I called the person responsible at the ILPTO and asked what we going on. She explained to me that we need to again request suspension, and that I should look at the letter. So I looked at the letter, saw the added verbiage, and asked her, “Did you think I was going to pay a fee because I’m a civic-minded person who wants to donate to the state’s coffers? Of course the fee is for the suspension, that letter is the only thing outstanding in the case, what else would I be paying money for?”

After some discussion, it turned out that the ILPTO’s computer system or work procedures had been modified, so that if the applicant doesn’t file a renewed request for suspension, the system isn’t aware that the fee has been paid, and it isn’t updated to confirm that the case is now suspended. So in that specific case, the employee manually updated the system and issued the “case is now suspended letter”.

But then I had to pay another suspension fee in a different case. So I went into the system to again request suspension, and found that (a) there’s no separate option for re-requesting suspension, there’s just “request suspension”, and (b) there’s no option to pay the fee when requesting or re-requesting suspension. So I uploaded the re-request for suspension, and then before submitting it did what I’d always done in the past when paying the suspension fee, viz. I went to the “request extension” option, then added payment for an extension. I then submitted both things at the same time and paid the fee. End of story, right?

Wrong. I get a call a day later from someone at the PTO: “You requested suspension but didn’t pay the fee”.

My response was along the lines of “Say what? Of course I paid the fee. It’s right there. I have the payment receipt!”.

“Well, I don’t see it, you’ll need to resubmit the request for suspension with the payment receipt.”

As I sad in the title of this post, you can’t make this up.

So I took the original suspension request, and added a text box with big red writing on the side: “NIS 2712 for 12 months’ suspension paid, receipt no. XXX”, and filed that.

ILPTO left hand, meet ILPTO right hand.

But then this week we had the piece de resistance, the crème de la crème, the cherry on top of the whipped cream. In a case in which suspension was requested two years ago, we got a first OA, without having been asked to pay the suspension fee. Second time that’s happened. As it turns out, the OA was pretty positive – it appears that, with some minor amendments similar to those made in another jurisdiction, we can gain allowance. But maybe the applicant wants to delay, so I reported the OA, and explained the option to either respond substantively, or request withdrawal of the OA and demand issuance of the “re-request suspension and pay your suspension fee letter”.

Then two days later, the ILPTO issued the “re-request suspension and pay your suspension fee letter”. But there was nothing in the letter to indicate that the OA itself had been withdrawn. So I wondered, “Will the system let me re-request suspension now”?

And – you know what’s coming – it won’t.  When I tried to submit another request for suspension, the system barked at me, “You can’t, nyeah nyeah nyeah, there’s an outstanding OA!”.

Now, I could pay the suspension fee, since the system will of course let me pay for an extension of time. But we saw from our other recent experience, since that payment will be classified by the system as part of an extension request and not a suspension request, the ILPTO won’t suspend examination.

So depending on what the client says, it looks like a few phone calls may be necessary to get the OA withdrawn and pay the suspension fee. Or maybe we’ll just answer the OA and proceed to allowance.

Suspension of Prosection: When A Patent Office Deliberately "Mails" A Letter With a Wrong Date

I'm prosecuting a case before the Israel PTO in which we requested suspension of examination.  Under current ILPTO practice, when an applicant requests suspension of examination¹, the ILPTO sends the applicant a letter shortly before the application is due to be examined, giving the applicant a period to time in which to pay a fee for suspension.²  After payment of the fee, the ILPTO normally sends a letter by email, telling the applicant that prosecution is suspended until date X.  When date X approaches, the applicant can request an additional suspension if warranted.

In the case in question, we paid the fee for suspension last year, but the ILPTO never sent that "the suspension is in effect until date X" letter - if it had, even if we hadn't received the letter by email or snail mail, a copy of the letter would appear in the online file history in the database, and no such copy of the letter appears in the file history.  The non-sending of the letter, and its absence from the online file history, didn't particularly bother me because in the ILPTO database the status of the case is listed as "examination suspended" (see photo below).

 

 

Nevertheless, today, in correspondence with someone at the ILPTO, I pointed out that no "your suspension expires on date X" letter was ever sent.  And presto, within a few hours I received such a letter by email. 

But there's a glitch: the letter bears the date last year on which we paid the fee for suspension, implying that the letter was actually sent last year, when of course it wasn't.  In fact, every letter generated by the ILPTO and sent to a practitioner by email includes a code in the name of the pdf file, indicating the date and time on which the system generated the letter.  This name of this particular file includes the date "03_03_2022" and the time "34129 PM". 

As mentioned above, as of this writing, the letter hasn't been posted to the database: the last entry in the database is my cover letter from last year informing the ILPTO that we were paying the fee for suspension. But the database is updated overnight.  I'll be checking in the morning to see if this antedated letter is posted to the database, and if so, what's listed as the date of posting - 2022, or 2021.  Stayed tuned.

¹The ILPTO currently only allows an applicant to request suspension in a particular window of time prior to the commencement of substantive examination.

²You can read here about why the requirement for payment is ultra vires.

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.

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.