Strategic Objective 2.2
Protect intellectual property and improve the patent and trademark system
This objective is important to the nation as it serves to ensure that the intellectual property (IP) system contributes to a strong global economy, encouraging investment in innovation, and fostering entre-preneurial spirit. Achievement of this objective will protect individual rights and innovation in a timely, efficient manner. A discussion of each performance goal within this objective will further describe the outcomes of the objective. People worldwide benefit from innovations, both directly on a personal level, and indirectly through economic growth fueled by innovation. Continual development of a vigorous, flexible, and efficient IP system protects individual rights, encourages investment in innovation, and fosters entrepreneurial spirit. The Department promotes the IP system through the protection of inventions or creations via patent, trademark, trade secret, and copyright laws. Under this system of protection, industry in the U.S. has flourished, creating employment opportunities for millions of Americans. The primary services provided by the Department within this objective are the examination of patent and trademark applications and dissemination of patent and trademark information. Issuance of patents provides incentives to invent and invest in new technology by allowing innovators the opportunity to benefit from their discoveries. Registration of trademarks assists businesses in protecting their investments and safeguards consumers against confusion and deception in the marketplace by providing notice of marks in use. Through dissemination of patent and trademark information, the Department promotes a global understanding of IP protection and facilitates the development and sharing of new technologies worldwide.
Performance Goal: Improve the quality of patent products and services and optimize patent processing time (USPTO)
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| Rating | Results |
|---|---|
| Exceeded Target | 0 |
| On Target | 4 |
| Slightly Below Target | 1 |
| Below Target | 0 |
| See Appendix A: Performance and Resource Tables for individual reported results. | |
The most significant activity under this goal is the examination of an inventor’s application for a patent by comparing the claimed subject matter of the application to a large body of technological information to determine whether the claimed invention is new, useful, and non-obvious to someone knowledgeable in that subject matter.
Providing quality services and products is USPTO’s foremost priority. USPTO’s commitment to the continuous refinement and expansion of the quality initiatives is outlined in the 21st Century Strategic Plan. Patent examinations are subjected to both end product and in-process reviews that evaluate the quality of the substantive basis for examiner decisions, applicability of searched cases, evidence, and clarity of communications with applicants. Findings produced by these reviews are shared individually with examiners, collected in a database for ongoing analysis, serve as the basis for the development of training programs, and used to strengthen the review process. Beginning in late 2006, USPTO commenced an intensive effort to better define quality and identify appropriate criteria to gauge quality.
This effort has culminated in plans that will ensure examiners maintain the knowledge and skill levels necessary to perform quality examinations through training and the administration of certification exams.
In January 2006, USPTO launched an academy approach to training entry-level patent examiners aimed at graduating examiners sufficiently skilled to produce quality examinations with reduced oversight. New employees are given in-depth training for up to eight months that combines technical and legal instruction, practical applications, small group study, and one-on-one assistance with real applications. The goal is for competency to improve and attritions of new hires to decrease. Approximately 600 new examiners participated in this program in 2006.
Two of the measures USPTO uses to gauge patent quality are the allowance error rate and the in-process examination compliance rate. An allowance error is defined as at least one claim within a randomly selected allowed application that would be held invalid in a court of law if the application were to issue without the required correction. The allowance error rate is measured by the ratio of the number of applications containing an allowance error to the total number of allowed applications reviewed. In FY 2006, efforts to improve quality resulted in an allowance error rate of 3.5 percent, 12.5 percent better than the goal of 4.0 percent.
The in-process examination compliance rate is a ratio derived from the number of office actions void of deficiencies that would significantly impact the applicant’s ability to advance the prosecution on the merits of the application, divided by the total number of office actions reviewed. At 90 percent in-process examination compliance, USPTO exceeded its goal of 86 percent.
The time to process a patent application is measured in two ways: (1) first action pendency—the average time in months from filing until an examiner’s initial determination is made of the patentability of an invention, and (2) total pendency—the average time in months from filing until the application issues as a patent, or is abandoned by the applicant.
USPTO strives to meet its goals of reducing pendency through a multi-pronged approach that includes hiring sufficient numbers of new examiners, retention of experienced staff, outsourcing, exploring work sharing with other patent offices, process reform through revised rules of practice, and training. In FY 2006 1,218 new patent examiners were hired. Additionally, USPTO has completed an agreement with the Australian Intellectual Property Office and awarded a competitive contract for outsourcing Patent Cooperation Treaty (PCT) searches in FY 2007 and beyond, which will free examiners to focus on the examination of national applications.
USPTO met its target of 31.3 months for total pendency. USPTO did not meet its first action pendency target of 22.0. The target was not met because there were more older applications processed than planned. USPTO expects to meet the goal next year through increased hiring efforts.
Patent efficiency measures the relative cost-effectiveness of the entire patent examination process over time, or the efficiency with which the organization applies its resources to production. The cost is calculated by totaling all costs (including direct and indirect) incurred to produce a patent product and dividing the sum by the number of product outputs. The FY 2006 target of $4,214 was met with an actual of $3,798.
| Rating | Results |
|---|---|
| Exceeded Target | 2 |
| On Target | 4 |
| Slightly Below Target | 0 |
| Below Target | 0 |
| See Appendix A: Performance and Resource Tables for individual reported results. | |
The fundamental process involved in reaching this goal is the examination of trademark applications. Trademark attorneys determine registrability under the provisions of the Trademark Act of 1946, as amended. The examination of trademark applications comprises many elements, including the utilization of electronic databases to determine whether the mark in an application is confusingly similar to any pending or registered mark, the preparation of an office action to inform applicants of the attorney’s findings, the approval of applications to be published for opposition, and the examination of Statements of Use filed under the Intent to Use provisions of the Trademark Act.
A vital component of USPTO’s commitment to improve the quality of examination is the identification of criteria used to assess the quality of an office action. In order to determine trademark examination quality, first and final examiner search results and actions are evaluated in order to create a more comprehensive and rigorous review of what constitutes examination quality. More than 350 items are scrutinized to determine “excellent,” “satisfactory,” and “deficient” work with regard to the examiner’s research, critical analysis of the application, and the writing of the office action. The examining attorneys’ handling of every substantive and procedural issue is also analyzed comprehensively. These more rigorous criteria have been used to measure quality for the past two years. As a result, the quality of the examiners’ first action on applications has demonstrably improved. The quality of final office actions has met its target goal.
In FY 2006, the trademark first action deficiency error rate was 4.3 percent, well below the 6.5 percent deficiency target. Similarly, the final action deficiency error rate was 3.6 percent, also less than the 6.5 percent target.
As part of USPTO’s commitment to improve the quality of examination and ensure that all examiners possess the knowledge, skills, and abilities necessary to perform at the highest level, examiners are required to take a series of e-learning tutorials. The quality review process allows the Office to conduct training on the micro level with specific feedback, and also on the macro level with training modules that address trends, targeting topics that warrant improvement.
The two primary measures used to determine Trademark application processing time are (1) first action pendency, which measures the average time, in months, from the filing date to when the examiner’s first action is processed; and (2) final action pendency, which is based on the average time, in months, from the filing date until the notice of abandonment, notice of allowance, or registration for applications based on use. The Office met its FY 2006 target, 5.3 months, by achieving a first action pendency of 4.8 months. Trademark final action pendency results were 15.5 months, excluding suspended and inter partes cases, and 18.0 months including all cases in FY 2006. The Office met its FY 2006 target of 16.3 months excluding suspended and inter partes cases, and 18.8 months including all cases.
The measure of Trademark efficiency is calculated by dividing total USPTO expenses associated with the examination and processing of trademarks (including associated overhead and supporting expenses) by outputs (office disposal). The measure indicates the degree to which Trademarks can operate within plan costs relative to outputs produced. The FY 2006 trademark efficiency target of $635 was met with an actual of $565.
The strategic plan outlines the Office’s commitment to working with its IP partners to improve the efficiency of its processing systems. The number of applications and communications received and processed electronically has continued to increase and has resulted in more coordinated and streamlined work processes. The continued expansion of electronic file management, when combined with internal process mapping, will allow a more efficient design and control of the work process, provide tools to monitor and better manage the work, measure production and timeliness, and evaluate quality. This greater reliance on electronic systems will, in turn, prepare the Office for the globalization that characterizes the 21st century economy.
| Rating | Results |
|---|---|
| Exceeded Target | 2 |
| On Target | 4 |
| Slightly Below Target | 0 |
| Below Target | 0 |
| See Appendix A: Performance and Resource Tables for individual reported results. | |
USPTO continues to work with its IP partners as well as its applicant public to improve its processing systems. Significant progress is being made in the transitioning of its patent and trademark operations to an e-government environment. Currently, all federally registered and pending trademarks are available to the public on USPTO’s Web site, www.uspto.gov. On USPTO’s Web site, a variety of tasks can be accomplished, including filing electronically for patents and trademark registration, reviewing the status of current applications as needed, tracking the status of a public patent application as it moves from pre-grant publication to final disposition, and reviewing the documents in the official patent application file, including all decisions made by patent examiners.
The public Patent Application and Information Retrieval (PAIR) system offers the public an advanced electronic portal for PDF viewing, downloading, and printing an array of information and documents for patent applications not covered by confidentiality laws. Public PAIR also offers a quick-click feature for ordering certified copies of patent applications and application files. The private PAIR system allows applicants access to the file history of their applications. In FY 2006, over 24.1 million search requests were made in public PAIR, and 2.7 million requests in private PAIR.
In March 2006, USPTO fully deployed an enhanced electronic filing system (EFS-Web). The system was designed with extensive applicant input to improve the ease of e-filing. E-filing reduces errors and expedites processing by eliminating the scanning and indexing required for paper applications. USPTO met its FY 2006 goal of 10.0 percent of patent applications filed electronically.
Additionally, conversion of all paper applications to electronic form was completed, providing desktop access to patent applications by all examiners, support, and management personnel. USPTO has met its target of electronically managing 99 percent of patent applications. In FY 2006, USPTO enhanced its telecommuting program to remotely provide patent examiners with full access to all patent systems necessary to perform their jobs from home, and added collaborative communication technologies. More than 500 patent employees now participate.
One exciting accomplishment during FY 2006 was the expansion of the Trilateral Document Access system that provides patent examiners at USPTO and Japan Patent Office (JPO) offices access to selected application documents in the file wrappers of each other’s office.
The public may access official trademark files online by using the Trademark Document Retrieval (TDR) system. This system grants access to the full file contents of all federally registered and pending trademarks in an electronic PDF format. TDR contains nearly two million pending and registered trademarks dating back to 1885, and represents more than 100 years of marketing creativity. TDR enables the public to download and print an array of information and documents. By allowing public access to interested parties, USPTO is better able to provide timely and useful information to business owners as they develop their marks and prepare to file trademark applications.
The goal for trademark applications filed electronically was revised to 80 percent, based on 2005 results, and the Office was still able to exceed the revised target in FY 2006 with 94 percent of applications received electronically. The trademark electronic filing system has been enhanced by expanding the number and type of transactions that can be completed online and by offering reduced fees to encourage electronic communications. Twenty-five electronic forms are now available through the award winning Trademark Electronic Application System (TEAS). Options for reduced fees, system enhancements, and the availability of forms that permit more electronic transactions have encouraged greater use and acceptance by trademark customers to the point where electronic filing is now the preferred method for communicating on trademark matters. USPTO has met its target of electronically managing 99 percent of trademark applications.
In the past year, the types of notices sent electronically through “Tpostal,” the Agency’s electronic bulk mailing system for trademark related notices, increased threefold. USPTO uses the U.S. Postal Service’s Web-based NetPost Mailing online system to print, stamp, and mail 16 types of notices. These postcard notices are sent electronically to trademark filers within 24 hours of receipt by U.S. Postal Service. Using postcards, rather than letters, saves time and reduces labor, materials, and postage costs, which result in considerable savings.
USPTO’s Office of External Affairs (EA) plays a critical role in the U.S. government’s efforts and obligations to provide IP technical assistance throughout the world. In FY 2006, EA conducted 239 Technical Assistance activities to date affecting 102 countries.
EA’s mission is to promote development of IP systems internationally. Some recent initiatives include collaborating with counterparts in the Chinese government to improve China’s intellectual property rights (IPR) administration and enforcement, placing IPR experts in six countries to support Embassy and Consulates on all IPR issues, and establishing USPTO Global Intellectual Property Academy (GIPA) to expand IP training, technical assistance, capacity programs, and activities for foreign government officials. Seventeen GIPA training programs have been conducted during FY 2006.
EA also manages a hotline (1-866-999-HALT) that helps small and medium-sized businesses leverage the resources of the U.S. government to protect their IPR in the United States and abroad. Callers receive information from a staff of more than 30 IP attorneys at USPTO with regional expertise on how to secure patents, trademarks, and copyrights, and on enforcement of these rights. In FY 2005, the hotline received 955 calls. In FY 2006, USPTO has received 1,460 calls through the hotline.
In support of U.S. Trade Representative (USTR) and other U.S. government agencies, USPTO plays a key role in the negotiation and drafting of IP provisions of free trade and other international agreements. These provisions generally require U.S. trading partners to provide stronger, more effective protection for IP than is required under World Trade Organization’s (WTO) Trade Related Aspects of Intellectual Property Rights (TRIP) Agreement. USPTO has participated in numerous negotiating rounds and/or implementing legislation for all recently concluded and ongoing free trade agreements (FTA).
In 2002, USPTO submitted the 21st Century Strategic Plan, updated in 2003, and has adhered to it over the past four years. In FY 2006, USPTO reviewed its progress in achieving goals, identified current and future challenges, and is in the process of updating the plan for FY 2007 – FY 2012. The new plan builds on the infrastructure developed in the original and outlines specific strategies to meet the goals of optimizing patent quality and timeliness.
Strategies to reduce patent pendency and improve patent quality will include enhanced recruitment to hire 1,200 new examiners a year for an extended period of time, establishment of a retention bonus program, increased training for new and existing examiners, and the creation of partnerships with universities to groom examiner candidates and increase knowledge of the patent system. Hiring alone will not achieve significant reductions in pendency without accompanying changes to the current one-size-fits-all system of examination. USPTO will, in collaboration with stakeholders, develop a suite of patent products to better meet the differing needs of applicants, and more efficiently utilize the Agency’s resources.
USPTO will improve and integrate existing electronic systems to promote full electronic patent application processing. This will involve promoting the utilization of electronic text content to facilitate the examination process and increase user acceptance of electronic filing systems. Applicants will be provided with expanded opportunities to conduct business with USPTO electronically. The Office will continue to expand patent examiners’ opportunities to participate in the telecommuting program at the rate of more than 500 additional employees annually.
Multiple initiatives will be implemented to improve quality. Examples of quality improvements include involving external stakeholders in defining quality, developing quality metrics and performance targets; assessing the existing process for reviewing examiner work; and externally validating quality data.
USPTO will transform patent appeals and interference processing and workload, and enrollment and discipline functions. This effort will entail enhanced communication and involvement with registered patent practitioners and improvements in the Agency’s responsiveness.
USPTO will continue to work on curbing IP theft and strengthen IP protection and enforcement in every corner of the globe. More IP experts will be posted in foreign countries where U.S. IP challenges are the greatest. Training and assistance programs will continue to combat and deter infringement and promote honest business practices in the use and development of IP. In addition, USPTO will continue its intensive national public awareness campaign to help educate small and medium sized businesses, where participants learn what IPR is, why it is important, and how to protect and enforce these rights.
Achieving the goal of optimizing patent quality and timeliness presents a broad spectrum of challenges. Congress and the public have recognized that the time it takes USPTO to reach a final decision on a patent application directly impacts U.S. competitiveness. A critical component to achieving the goal of timely, high-quality examinations entails the hiring and retention of more patent examiners. Unfortunately, USPTO must compete with other employers to attract and retain the most talented and sought after individuals.
Optimizing quality first requires accord between USPTO and applicants on the definition of quality and how to measure it. To maintain the U.S. system as the best patent examination system in the world, USPTO must provide applicants with products that protect their IPR while simultaneously facilitating efficient use of USPTO resources. Leveraging new technologies in pursuit of efficiency requires a vision of the examination processes of tomorrow.
Addressing many of these challenges requires an interrelated approach to ensure that the solution to one challenge does not hamper the remedy of another. USPTO’s updated strategic plan for FY 2007 – FY 2012 provides a set of focused initiatives to ultimately produce solutions to the challenges noted above.
Increasing public awareness of various IP issues and interests and how these affect them is an important aspect of the USPTO role. Educating the public about the examination processes of USPTO and how these relate to the use of IPR in the market place will help in that process. Communicating with and informing the public about the intersection of IP issues and the news stories they read everyday will help to generate a better understanding of the role of such rights in the global economy. Promoting an understanding that the violation of IPR affects everyone, and how, will be beneficial to improving the effectiveness of the system as a whole.
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