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Newly created First Action Final Rejection policy adds unnecessary complications to patent prosecution

Julie Burke

Julie Burke

William Smith

William Smith

Michael Spector

Michael Spector

Cover Image for Newly created First Action Final Rejection policy adds unnecessary complications to patent prosecution

Based on an obscure and essentially uncirculated 2017 final agency decision (“FA Decision”), the USPTO recently revised Manual of Patent Examination Procedure (“MPEP”) § 706.07(b) to retroactively impose a first action final rejection (“FAFR”) legal standard that creates uncertainty and significantly reduces patent applicants’ options. From a survey of FAFR petition decisions available on Petition.ai, we discovered that prior to the June MPEP revision, the USPTO has been applying two different legal standards for determining the propriety of a FAFR, entirely dependent on the technology and industry-sector.

The majority of the patent corps apply the more traditional legal standard established in 1969 which limit FAFR in continuing applications to claims of identical scope as previously examined (“identical scope”). The recently codified § 706.07(b) legal standard (“patentably indistinct”) authorizes FAFR in continuing applications on substantially amended claims. The revised MPEP § 706.07(b) lacks rationale or guidance to identify circumstances in which examiners would be authorized to apply the identical scope or the patentably indistinct legal standard. Codifying the new FAFR legal standard in the June MPEP revision opens the door for all patent examiners, regardless of their technology or industry-sector, to impose FAFRs in continuing applications, including requests for continued examination (“RCE”) which contain substantively amended claims, if they so wish.

The policy change prompts applicants to engage in the futile exercise of after final practice, typically resulting in (i) increased fees for needless extensions of time and (ii) a 2-4 month delay in prosecution. Moreover, this expanded FAFR policy change rewards examiners with extra “counts”. While the policy change is a win-win for the USPTO, it creates uncertainty and imposes unnecessary complications for patent practitioners.

Using Petition.ai’s database, we identified 24 FARF petitions based upon similar fact pattern (FAFR rejection on amended claims filed with a RCE or continuation application) and analyzed the legal standard applied in the decisions (15 – identical scope¸ 9 – patentably indistinct). We determined no change was evident in deciding official behavior before or after the FA Decision. Up until the June MPEP revision, the patent corps was neatly divided into two camps depending upon the legal standard applied to compare the amended claims to the previously presented claims.

  • Practitioners experienced an 87% (13/15) grant rate when deciding officials applied the identical scope legal standard.
  • Remarkably, 0% (0/9) of the FAFR decisions were granted when deciding officials applied the patentably indistinct legal standard.
  • Interestingly, the legal standard used to evaluate the petitions seemingly is tied to the industry sectors, not to individual Group Directors, as two Group Directors swapped TCs during the surveyed period yet maintained the respective TC’s FAFR legal standard.

Premature Finality Petition Decisions

Final rejections and the attendant after final practice are anachronisms that need to be abolished in favor of a modernized compact prosecution regime where every amendment is entered as a matter of right with applicant’s response to every third office action to be accompanied by a RCE request and fee. The adoption of such a policy will save examiners and applicants resources (time, effort and money) that are now used in a futile manner. Applicants should be able to expect better treatment from an agency funded by their user fees.

To read the full article Part I & Part II

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