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Updated Patent Examining Guidelines

Summary: USPTO patent examination guidelines published in the Federal Register (Vol. 76, No. 27, Feb. 9, 2011) apply to all applications filed before, on or after February 9, 2011. The stated objective is to enhance the quality of patent by issuing less ambiguous claims. Particular emphasis is placed on meeting the enablement requirements of 35 USC 112. The guidelines also single out “computer-implemented invention claims” as an area of additional concern. This document seeks to provide a useful distillation of what patent examiners are analyzing.

The Examination Process:

The guidelines set forth a three (3) stage process:

I. Broadest Reasonable Interpretation:

During examination a claim must be given its broadest reasonable interpretation consistent with the specification as it would be interpreted by one of ordinary skill in the art. Key points:

1) Interpret under “ordinary skill” standard;

2) Words in claim given plain meaning unless specification contradicts;

3) Specification should be a “glossary” for claim terms;

4) Infringement interpretation of claims is different from examination;

5) Courts will not find claim indefinite unless it is “insolubly ambiguous”; and

6) Examiner should not confuse claim breath with indefiniteness.

Example: A genus claim that covers multiple species is broad, but is not indefinite because of its breath, which is otherwise clear.

II. Determining Whether Claim Language is Definite

A decision on whether a claim is indefinite under §112, ¶2 requires a determination of whether those skilled in the art would understand what is claimed when the claim is read in light of the specification. Certain areas frequently generate questions of indefiniteness:

Functional Claiming: A claim term is functional when it recites a feature by what it does rather than by what it is.

1. Nothing per se wrong with functional claiming – authorized by §112, ¶6 (means-plus-function).

2. Problem with functional claims – without reciting the particular structure, materials or steps that accomplish the function or achieve the result, all means of methods of resolving the problem may be encompassed by the claim.

Functional Claiming That Did NOT Pass Muster:

· A tungsten filament for incandescent lamps with the limitation providing “comparatively large grains of such size and contour as to prevent substantial sagging or offsetting during a normal or commercially useful life for such a lamp or other device.” Problem: “size and contour” not adequately defined….indefinite!

· “…pure carbon black in the form the form of commercially uniform, comparatively small, rounded smooth aggregates having a spongy or porous exterior.’’ Problem: “commercially uniform” meant only the degree of uniformity desired by the buyer. Also spongy and porous not helpful adjectives in distinguishing prior art.

Functional Claiming That Did Pass Muster:

· “transparent to infrared rays” was OK because the specification shows the IR rays passed through even though degree of transparency varied.

 

Author Comment

Functional claiming is common is biotechnology application (e.g., the binding thus effecting apoptosis in the target cell…). Functional claiming in the “unpredictable art” of oncology requires careful analysis of the clinical results which hopefully span an appropriate number of conditions to achieve enablement of the claim limitation.

 

3. Non-exclusive test for patent examiners to determine if functional language is ambiguous:

a. Clear cut indication of the scope of the subject matter covered by the claim?

b. Well-defined boundaries of invention or only states a problem solved or result obtained?

c. Would structure of steps encompassed by claims be apparent to one of ordinary skill in the art?

4. Suggestions to Patent Drafters:

a. Use quantitative metrics (i.e., “an aperture 10 to 20 cm in diameter” rather than “a large hole”)

b. Employ a formula for calculating a property (i.e., “an aperture 6 to 12 percent of the housing length”)

c. Provide general guidelines and examples in the specification itself (i.e., “the aperture must be large enough to accommodate a flow of the oil expelled at 2,000 liters per minute while maintaining a PSI under 200.”)

d. Be prepared the amend the claims to recite a particular structure that accomplishes the function.

Terms of Degree: When a term of degree is used in a claim, the patent examiner must check the specification to see if there is guidance on how to measure that degree. For example, a specification might even define small, medium and large (i.e,. small apertures, those between 2-3mm; medium apertures, those between 3-6mm; and large apertures, those over 6mm may be deployed in various embodiments of the invention…). Examiner analysis:

Subjective Terms: Examiner must determine whether specification supplies some standard for measuring the scope of the term (similar to analysis for degree above). A claim that requires subjective judgment without restriction may render the claim indefinite.

Subjective Claiming That Did NOT Pass Muster:

· A computer interface screen with an “aesthetically pleasing look and feel.”

Markush Groups: A “Markush” claim recites a list of alternatively useable species (i.e., a fruit selected from the group consisting of apples, oranges and grapes).

Improper Markush claims:

1. A Markush group so expansive that persons skilled in the art cannot determine the metes and bounds of the claimed invention (reject as indefinite).

2. “Improper Markush grouping”

a. The species of the group do not share a “single structural similarity”; or

b. The species do not share a common use.

Proper Markush claim examples:

1. Same recognized physical or chemical class;

2. Same art-recognized class; and

3. Share a common use when functionality equivalent.

Restriction Practice

Examiners are advised to require the Applicant to elect a species or group of indistinct species for search and examination and the examiner’s search extended to the species that share a single structural similarity and common use.

Dependent Claims:

1. Must be rejected under §112, ¶4 if it omits an element from the claim upon which it depends; or

2. Fails to add a limitation to the claim upon which it depends.

Author Comment

Under the proposed patent reform, the PTO will have fee-setting authority and it clearly disfavors excessive dependent claims. Patent practitioners should carefully consider each dependent claim and whether is provides both a commercially viable limitation as well as meaningful claim differentiation.

Correspondence Between Specification and Claims:

Claim terms must find clear support or antecedent basis in the specification so that the meaning of the terms may be ascertainable by reference to the specification.

· The exact claim terms are not required to be used in the specification as long as the specification provides the needed guidance on the meaning of the terms (e.g.,

· Applicants are encouraged to use glossaries as a best practice in patent application preparation.

Means Plus Function Claim Limitations: If a claim limitation recites a term and associated functional language, the examiner should determine whether the claim limitation invokes §112, ¶6 (means-plus-function).

Author Comment

From a patent value and infringement standpoint, means-plus-function limitations are generally disfavored. For example, if the limitation was “means for conducting the electrical current” and the patent specification only disclosed an aluminum conductor, then the anti-corrosive properties of aluminum cannot be imported into the claim since the function claimed was electrical conduction. A better limitation would have been to claim the structure and not its function (e.g., “an electrical conductor”).

 

Examiners will apply §112, ¶6 to a claim limitation that meets the following conditions:

· The claim limitation uses the phrase ‘‘means for’’ or ‘‘step for’’ or a non-structural term that does not have a structural modifier;

· the phrase ‘‘means for’’ or ‘‘step for’’ or the non-structural term recited in the claim is modified by functional language; and

· the phrase ‘‘means for’’ or ‘‘step for’’ or the non-structural term recited in the claim is not modified by sufficient structure, material, or acts for achieving the specified function.

It is important to note this guideline modifies existing MPEP §2181. If unclear about whether §112, ¶6 is invoked, patent examiners are instructed to find the limitation indefinite under §112, ¶2.

Preamble: When the phrase “means for” or “step for” is used in the preamble:

· Find indefinite under §112, ¶2 if unclear whether the preamble recites a means-plus-function or is simply stating the intended use of the invention.

If Means-Plus-Function Found….What’s Next?

· Determine the claimed function

· Review the specification to determine whether the corresponding structure, material or acts that perform the claimed function are disclosed.

· Does written description of specification clearly link or associate the corresponding structure, material or acts to the claimed function? If not, reject under §112, ¶2.

o Examiners can also issue a requirement for information under 37 CFR 1.105 wherein the applicant must identify the corresponding structure material or acts that support the means-plus-function claim.

· How about statement in specification that known techniques or methods can be used to achieve the function? Not enough to support means-plus-function limitation. Reject under §112, ¶2.

Means-Plus-Function in Computer-Implemented Inventions:

· Corresponding structure in specification must be more than a general purpose computer.

· Must include algorithm that transforms the general purpose computer to a special purpose computer.

· What can serve as algorithm?

o Mathematical formula;

o Prose;

o Flow chart; or

o Any other manner that provides sufficient structure.

· Vague terms patent examiners will look for as a basis for rejection:

o Merely referencing a specialized computer (e.g., a “bank computer”)

o Undefined components of a computer system:

§ “access control manager”

§ “logic”

§ “code”

· For pure software claims the specification must have a corresponding algorithm and the computer or microprocessor programmed with the algorithm.

III. Resolving Indefinite Claim Language

A. Examiner must establish a Clear Record. See MPEP §2173.05 for example rationales. Avoid making mere conclusions.

B. Examiner must set forth the specific term or phrase that is indefinite and why the metes and bounds are unclear.

C. Examiner should only be concerned whether claim meets threshold requirements of clarity and precision….not whether more suitable language or modes of expression of available. Examiner may suggest but not reject in these circumstances.

Compact Prosecution

When claim limitation is indefinite, examiner should make their best interpretation, issue the §112, ¶2 rejection, and analyze the limitation (according to their interpration) against the prior art. Interviews are highly encouraged.

Conclusion and Recommendations

The revised examination guidelines are not a radical departure from traditional practice. However, patent practitioners should take note of the following key points:

1. Use glossaries in the patent specification

2. Avoid means-plus-function language (claim structures, not functions)

3. Use quantitative limitations over qualitative whenever possible

4. Computer-implemented invention claims have unique requirements

Supreme Court Requires “Round Trip” for First Sale Defense

On December 13, 2010 the U.S. Supreme Court affirmed 4-4 a Ninth Circuit decision restricting the 1st sale doctrine to copyrighted works manufactured in the U.S. or sold with the copyright holder’s permission.

Omega, a Swiss luxury watch maker discovered Costco was selling its OMEGA 007 James Bond Seamaster watches in California.  The watch has a U.S. copyrighted laser-engraving.  Two copyright provisions were at odds in this case:

1. Importation Prohibited: Importation of a copyrighted work without authority of the copyright holder is prohibited under § 602(a)(1) of the Copyright Act; and
2. First Sale Defense: The owner of a lawfully obtained copy is authorized to sell or otherwise dispose of the possession of the copy under § 109.

The issue of §§ 602 and 109 has been previous litigation in the 1998 Supreme Court case of Quality King Distribs. v. L’Anza Research Int’l, 523 U.S. 135 (1998).  There, the product was made in the U.S., sent overseas and then returned back to the U.S. In Quality King, the First Sale Defense applied because the first sale was inside the U.S. (i.e., the goods took a “round trip”). 

However, in the Omega case, the goods were made in Switzerland, distributed to various middle east countries before then came into Costco’s possession. 

Therefore, the first sale was not inside the U.S. (i.e., no “round trip”) occurred.  Thus, Omega was able to stop the sale of the watches by Costco.

As a side note, this case was affirmed from the 9th Circuit on a 4-4 split because now-Justice Elena Kagan (then U.S. Solicitor General) recommended the U.S. Supreme Court not hear the case (which they did anyway).

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Track One Patent Examination….the $4,000 Option

The USPTO’s proposed three track system seems headed for implementation.  High priority cases (Track One) that incur a fee of $4,000 per application give applicants the opportunity for prioritized examination of a patent within 12 months of its filing date.

Track One cases have some requirements:

• the proposed fee of $4,000 for each application (to recover the full cost of resources necessary to prevent the delay of other, non-prioritized applications);
• limits on the number of claims to four independent claims and 30 total claims;
• application filing through the USPTO’s electronic filing system (EFS-Web); and other such requirements. 

During the program’s first year, the USPTO plans to limit the number of applications in the program to 10,000 to ensure that it can meet the 12-month goal. 

For small entities, the USPTO is working to offer a fifty percent discount on any filing fee associated with Track One, as it does with many other standard processing fees. The patent reform legislation recently passed by the U.S. Senate would enable the USPTO to set its own fees and thereby extend this discount to small entity applicants.

Judge Sets Aside $357,693,056.18 Judgment Against Microsoft Outlook’s Appointment-Scheduling Feature

While the judge affirmed the jury finding of infringement of Lucent’s patent claims on a “method of entering information into fields on a computer screen without using a keyboard” it set aside the jury award in Lucent Technologies v. Gateway, Inc., 580 F.3d 1301, 1308 (Fed. Cir. 2009), cert. denied, 130 S. Ct. 3324 (2010).

While users (like me) directly infringed on the claims by using Microsoft Outlook’s appointment-scheduling feature, Microsoft (among others) were found indirectly liable on both inducement and contributory infringement theories. However, suing little customers does not make good business sense.  Lucent went after Microsoft, Dell, et al (i.e., deep pockets).

In vacating the jury award, the judge noted that while the feature was available in Outlook, it was not necessarily used by every consumer.

Patent Reform Passes Senate 95-5–What it Means for Universities, Inventors, Businesses and Patent Firms

The Senate passed patent reform legislation yesterday which is the most sweeping change to patent practice in over 60 years.  The bill passed only after lawmakers dropped the thorniest issue: whether to narrow damages paid for infringing on a patent. By dropping the damages provisions, the legislation essentially leaves the matter of where to set damages up to the courts.   If the House legislation resembles the Senate legislation it will change the way a number of different organization handle innovation.

UNIVERSITY TECH TRANSFER:

The proposed legislation grants the U.S. Patent & Trademark Office (“USPTO”) authority to set it own fees.Trade groups like the Association of University Technology Managers (AUTM) will lobby the USPTO to establish “academic” filing fees that might even be aligned with the proposed “micro-entity” fees for individual inventors.  From a workflow standpoint, Universities will continue to file provisional patent applications to delay higher patent prosecution expenses while they seek licensees for their technology.  The post-grant patent opposition system may introduce a new and potentially expensive line-item in the patent prosecution budget if a response is required.  However, post-grant oppositions are likely to be a rare occurrence. 

INDIVIDUAL INVENTORS:

With fee-setting authority the USPTO will likely offer “micro-entity” fees for individual inventors.  Perhaps a provisional patent application fee will be $60 instead of $110 for a current “small entity” or $220 for a current “large entity.”  The first-to-file provision (as opposed to first-to-invent) will be meaningful to patent holders will limited financial resources.  When first-to-invent rights are invoked, the federal court litigation and/or proceeding before the Board of Patent Appeals and Interference easily can run over $600,000.  It is far less expensive and efficient to simply check who filed their application first. 

NON PRACTICING ENTITIES:

Otherwise known as “patent trolls,” patent attorneys that acquire unused patents and sue companies for patent infringement are probably relieved that the damages limitations were removed from the Senate bill prior to passage.  Although some patent litigation may involve tax strategy patents (which would be eliminated under the Senate bill), the U.S. Supreme Court’s Decision in Biski effectively rendered those type of patents highly questionable and difficult to assert. 

SMALL COMPANIES:

Small companies will likely start monitoring their competition more aggressively through their patent attorneys to take advantage of post-grant patent opposition claims.  For example, if a competitor’s patent application issues with dubious and economically disruptive patent claims, then the company may seek to oppose it’s issue rather than get sued in district court for infringement later on.  Additionally, the company may also file prior art with the patent examiner that is evaluating their competition’s patent application during patent prosecution (prior to issuance).

LARGE COMPANIES:

Fortune 500 companies will be pleased that the first-to-file system will remove a substantial amount of litigation involving who was first to invent.  Large companies typically have well-established patent filing workflows so they will continue to rapidly file patent applications on newly developed technology.  One technique used by our firm with larger entities is to file a series of provisional patent applications as the technology continues to develop.  At the one-year anniversary date of the first provisional patent application, a non-provisional patent application is filed claiming priority to all the provisional applications that were filed.  As noted above, large companies will closely monitor their competition and become more involved in prior art submissions both during the patent prosecution stage as well as during the post-grant patent opposition phase.  Large companies will certainly lobby the House to reintroduce damages limitations.  The USPTO’s fee setting authority will likely raise the filing fees substantially for larger entities (500 or more employees).

PATENT FIRMS:

Patent firms and patent owners alike tend to support patent reform.  By switching to a first-to-file system a substantial amount of uncertainty is removed from patent valuation.  Patent litigators may take a financial hit by losing the first-to-invent discovery process in favor of the far more simple (read “inexpensive”) first-to-file determination.  With expanded ex parte prior art submissions during patent prosecution look for new patent monitoring services of competitors’ filings.  Patent attorneys will also be going “back to school” to develop skills in the post-grant opposition proceedings.  Overall, patent reform goes a long way to reducing uncertainties in the value of a patent and thus will likely foster innovation.