The United States Patent and Trademark Office March 15, 2005 BCP Customer Partnership Meeting

2 Contact Information John Doll Deputy Commissioner for Patent Planning and Resources

3 Contact Information Peggy Focarino Deputy Commissioner for Patent Operations Joe Rolla Deputy Commissioner for Patent Policy

4 Commissioner for Patents Nicholas P. Godici To Retire March 29th

5 Commissioner for Patents Star Search Wanted:

6 Jon’s New Initiatives Reexamination É Special Dispatch

7 Jon’s New Initiatives Reexamination É Special Dispatch PCT É Timeliness of Actions

8 Jon’s New Initiatives Reexamination É Special Dispatch PCT É Timeliness of Actions BPAI Appeals É 60% never make it

9 Jon’s New Initiatives Search Quality É Search Grids É Search Recordation É Search QR

10 Jon’s New Initiatives Search Quality É Search Grids É Search Recordation É Search QR Patentability Conferences É Quality & Training

11 Jon’s New Initiatives Search Quality É Search Grids É Search Recordation É Search QR Patentability Conferences É Quality & Training 2 nd Pair of Eyes É Redefine

12 Jon’s New Initiatives e-filing probably in XML tagged format É All follow on papers must be e-filed Limited number of claims É 2 – 3 independent / 20 – 30 dependent Patentability search É With explanation of each reference with respect to claims Mandatory telephone restriction elections Mandatory interview either before or right after first action 2 month shortened statutory time for response É With no extensions Mandatory appeal Accelerated Examination Initiative

13 UPR Applications Filed  FY ,527  6.6% above FY 03  FY 05 plan 375,080 (5.5% above FY 04)  118,235 as of 1/28  Current projection 102.6% over plan

14 FY 04 UPR Applications Filed FY 04 UPR 1 Applications Filed Technology Center FY 04 FY 03 to FY04 Growth Rate Biotechnology and Organic Chemistry38, % Chemical and Materials Engineering 49, % Computer Architecture Software and Information Security 34, % Communications48, % Semiconductor, Electrical, Optical Systems81,1447.6% Transportation, Construction, Electronic Commerce47, % Mechanical Engineering, Manufacturing and Products56,5335.5% UPR Total 355,5276.6% 1 “UPR” = Utility, Plant, and Reissue Applications FY 05 TC filings not yet available. Initial processing imposes a two to four month delay in assignment to a TC.

15 FY 04 Patent Pendency FY 04 Patent Pendency Technology Center Average 1 st Action Pendency 1 (months) Average Total Pendency 2 (months) Biotechnology and Organic Chemistry Chemical and Materials Engineering Computer Architecture Software and Information Security Communications Semiconductor, Electrical, Optical Systems Transportation, Construction, Electronic Commerce Mechanical Engineering, Manufacturing and Products UPR Total “Average 1 st action pendency” is the average age from filing to first action for a newly filed application, completed during 4 th quarter FY “Average total pendency” is the average age from filing to issue or abandonment of a newly filed application, completed during 4 th quarter FY 2004.

16 FY 05 Patent Pendency (as of 12/31/04) FY 05 Patent Pendency (as of 12/31/04) Technology Center Average 1 st Action Pendency (months) 1 Average Total Pendency (months) Biotechnology and Organic Chemistry Chemical and Materials Engineering Computer Architecture Software and Information Security – Communications Semiconductor, Electrical, Optical Systems Transportation, Construction, Electronic Commerce Mechanical Engineering, Manufacturing and Products UPR Total (as of 12/31/2004) FY 05 Target 20.7* “Average 1 st action pendency” is the average age from filing to first action for a newly filed application, completed during 1 st quarter FY “Average total pendency” is the average age from filing to issue or abandonment of a newly filed application, completed during 1 st quarter FY * Assuming current input and output estimates, the agency should achieve first action pendency of 21.3 months by the end of FY 2005.

17 FY 04 Patent Pendency FY 04 Patent Pendency Technology Center Average 1 st Action Pendency 1 (months) Average Total Pendency 2 (months) 1610 – Organic Compounds: Bioaffecting, Body Treating, Drug Delivery, Steroids, Herbicides, Pesticides, Cosmetics and Drugs – Organic Chemistry – Molecular Biology, Bioinformatics, Recombinant DNA/RNA, Gene Regulation, Nucleic Acid Amplification – Immunology, Receptor/Ligands, Cytokines, Recombinant Hormones, Molecular Biology – Fermentation, Microbiology, Proteins/Enzymes Plants UPR Total “Average 1 st action pendency” is the average age from filing to first action for a newly filed application, completed during 4 th quarter FY “Average total pendency” is the average age from filing to issue or abandonment of a newly filed application, completed during 4 th quarter FY 2004.

18 FY 05 Patent Pendency (as of 12/31/04) FY 05 Patent Pendency (as of 12/31/04) 1 “Average 1 st action pendency” is the average age from filing to first action for a newly filed application, completed during 1 st quarter FY “Average total pendency” is the average age from filing to issue or abandonment of a newly filed application, completed during 1 st quarter FY Technology Center Average 1 st Action Pendency 1 (months) Average Total Pendency 2 (months) 1610 – Organic Compounds: Bioaffecting, Body Treating, Drug Delivery, Steroids, Herbicides, Pesticides, Cosmetics and Drugs – Organic Chemistry – Molecular Biology, Bioinformatics, Recombinant DNA/RNA, Gene Regulation, Nucleic Acid Amplification – Immunology, Receptor/Ligands, Cytokines, Recombinant Hormones, Molecular Biology – Fermentation, Microbiology, Proteins/Enzymes Plants UPR Total

Total*Design New Applications 1 9/30/ ,35852,38866,64585,91757,52845,62250,280457,25411,704 New Applications 1 9/30/ ,40263,92371,77897,38077,65156,73865,005508,87818,451 Overall Pending Applications 2 9/30/ ,82792,41288,387121,558118,89987,15391,170737,94422,533 Overall Pending Applications 2 9/30/ ,006105,447102,440138,822137,458101,097108,039809,32327,599 TC Application Inventory 1 “New Application inventory” is the number of new applications designated or assigned to a technology center awaiting a first action. 2 “Overall Pending Application inventory” is the total number of applications designated or assigned to a technology center in an active status. Includes new applications; rejected awaiting response; amended; under appeal or interference; suspended; reexams and allowed applications awaiting grant publication. * Total inventory includes approximately 55,000 applications awaiting processing 9/30/2003, and approximately 22,000 applications awaiting processing 9/30/2004.

20 Inventory by Art Examples High Inventory Art Areas Months of Inventory* Low Inventory Art Areas Months of Inventory* 1614, 1615, and 1617 – Drugs, Bio-affecting and Body Treatment 47 – – Organic Chemistry – Chemical Analysis – Adhesive Bonding and Coating Apparatus – Computer Task Management – Manufacturing Control Systems and Chemical/ Mechanical/Electrical Control – Interactive Video Distribution , 2653 – Information Storage and Retrieval – Control Circuits – Electrical Conductors – Business Methods34 – – Conveying and 3737 – Medical Instruments, Diagnostic Equipment 46 – – Thermal and Combustion Technology 10 *The number of months it would take to reach a first action on the merits (e.g., an action addressing patentability issues) on a new application filed as of Jan 2005 at today’s production rate. Today’s production rate means that there are no changes in production due to hiring, attrition, changes to examination processing or examination efficiencies, and that applications are taken up in the order of filing in the given art unit/area. Of course, USPTO is taking aggressive steps to ensure changes that will significantly lower the inventory rates in high-inventory art areas.

21 Inventory by Art Examples Art AreasMonths of Inventory* 1614, 1615, and 1617 – Drugs, Bio-affecting and Body Treatment47 – – Steroids, Herbicides, Pesticides – Organic Chemistry – Bioinformatics – Molecular Biology, Nucleic Acids, Recombinant DNA/RNA, Gene Regulation, Gene Therapy, Animals and Recombinant Plants, Combinatorial/Computational Chemistry – Immunology, Receptor/Ligands, Cytokines, Recombinant Hormones, Molecular Biology – Fermentation, Microbiology, Isolated and Recombinant Proteins/Enzymes – Plants9 *The number of months it would take to reach a first action on the merits (e.g., an action addressing patentability issues) on a new application filed as of Jan 2005 at today’s production rate. Today’s production rate means that there are no changes in production due to hiring, attrition, changes to examination processing or examination efficiencies, and that applications are taken up in the order of filing in the given art unit/area. Of course, USPTO is taking aggressive steps to ensure changes that will significantly lower the inventory rates in high-inventory art areas.

Workload Analysis FilingsFAOMs PCT Production FY 0241,64129,7275,938 FY 0338,61327,87510,021 FY 0438,16426,51010,183 “FAOM” = First Action on the Merits – first action count by an examiner after the filing of an application (does not include restrictions or other miscellaneous actions).

23 TC 1600 Rework* Statistics *Rework first actions are those actions that are in a Continuing, CPA or RCE application.

24 Restriction/Divisionals in 1600 Written RestrictionsDivisionals Filed FY 009,2673,326 FY 0111,4353,832 FY 0213,1933,988 FY 0311,8993,918 FY 0411,4153,489

25 Patents Issued in TC 1600

Corps FY 04 % First Action Allowances 13.0%17.8%10.3%13.5%27.1%12.1%17.9%17.4% FY 05 % First Action Allowances Through 1/11/ %15.7%9.7%13.6%28.8%14.1%17.0%17.5% TC 1 st Action Allowances* *TC First Action Allowances are calculated from first action counts received by an examiner. A first action restriction performed by an examiner is not a ‘first action count’ and thus an allowance following a first action restriction is included as a first action allowance count. A first action allowance following the filing of an RCE is included. An examiner receives both a first action count and a disposal count for first action allowances.

27 Quality of Products Fiscal Year Design FY 04 Total FY 05 Target Application In-Process Review Compliance Rate %83.1%88.3%74.2%86.8%79.6%81.7%90.4%82.0%84% Patent Allowance Error Rate %8.03%3.05%2.53%3.39%7.54%9.01%3.28%5.32%4.0% 1 Compliance is the percent of office actions reviewed and found to be free of any in-process examination deficiency (an error that has significant adverse impact on patent prosecution). 2 Patent allowance error rate is the percent of allowed applications reviewed having at least one claim which is considered unpatentable on a basis for which a court would hold a patent invalid. “Allowance” occurs before a patent is issued, so these errors are caught before any patent is actually granted.

28 Hires and Attritions CorpsDesign FY 04 Hires FY 04 Attritions FY 05 BOY Examiner Staff FY 05 Hiring Goal FY 05 Hiring Summary (2/7/05)* New Hire Percentage of Total 24%8%36%23%22%21%28%23%28% *Includes hires on board and confirmed and pending offers

New Examiner Hiring WorkgroupNumber Hiring

30 Patents e-Government Initiatives EFS Web Interface pdf 1 application submission Tri-lateral Dossier Access with EPO Priority Document Exchange Patent’s File Wrapper (PFW) - Moving from electronic image based applications (IFW) to electronic text based applications (PFW) 1 “pdf” is an internationally accepted standard format for electronic documents.