Earlier this week I provided a summary of the USPTO’s proposed rules to implement the Supplemental Examination provisions of the America Invents Act. The Federal Register Notice also includes a discussion of the USPTO’s estimate of how much a Request for Supplemental Examination will cost to prepare, and its estimate of how many Requests will be filed on an annual basis. Members of the public may submit written comments on these estimates by March 26, 2012.
The Cost Estimate
The USPTO indicates that a “patent practitioner” will “have the type of professional skills necessary” to prepare a Request for Supplemental examination. Apparently, “Office staff with experience and expertise in a wide range of patent prosecution matters” were polled to arrive at the USPTO’s time and cost estimates for preparing a Request:
25 patent practitioner hours, costing $8,500 (25 hours at the $340 per hour median rate for attorneys reported in the American Intellectual Property Law Association (AIPLA) Report of the Economic Survey 2011.
The USPTO acknowledges that the same AIPLA report “indicates that the average cost of preparing and filing a request for ex parte reexamination . . . is $19,000,” but justifies its much lower cost estimate for Requests for Supplemental Examination as follows:
[A] patentee in supplemental examination would simply be preparing a supplemental examination request in compliance with the applicable statutes and regulations with information already at hand, whereas a third party requester in an ex parte reexamination (the majority of ex parte reexamination requests being by third parties) is not merely preparing an ex parte reexamination request in compliance with the applicable statutes and regulations, but is also seeking to convince the Office that the claims in the patent for which reexamination is sought are unpatentable with patents and printed publications that the third party must uncover as part of the process.
This justification ignores other commentary in the Federal Register Notice regarding the increased complexity of Requests for Supplemental Examination because they are not limited to prior art issues raised by patents or printed publications. It also ignores the fact that the proposed rules include new procedural requirements and additional substantive requirements (such as the requirement to provide a “summary” of each item of information that is over 50 pages long). Moreover, to the extent that Requests are filed in patents where litigation is contemplated, patent holders are likely to exercise a very high standard of care with regard to every element of the Request, to minimize the risks of an inequitable conduct charge based on the Request!
The Volume Estimate
The USPTO estimates that it will receive about 1,430 Requests for Supplemental Examination per year. This number is based on the assumption that all patent-owner initiated ex parte reexamination proceedings (which it estimates at about 110 per year) will be instituted pursuant to a Request for Supplemental Examination. This number also is based on the assumption that the number of patents that are subject to an inequitable conduct charge in district court patent litigation (about 40% of an estimated 3,300 patent cases per year) is a good estimate for the number of additional Requests for Supplemental Examination that will be filed.
The latter estimate assumes that patent holders can foresee the basis of inequitable conduct charges, and will expect to be able to prevent them through a Request for Supplemental Examination. Given that most inequitable conduct charges are not upheld during court proceedings, this may not be the case.
More Realistic Numbers?
I am interested in knowing what other patent practitioners “with experience and expertise in a wide range of patent prosecution matters” think of these numbers. My initial reaction is that a Request will take much more than 25 hours to prepare, even after the “items of information” are determined and selected. Moreover, while the protections of new 35 USC § 257(c) may prompt the filing of more than 110 Requests per year, I would be surprised if the difference is the full order of magnitude predicted by the USPTO.