Monday, December 17, 2007

Patent Prosecution Malpractice

In the December 10, 2007 edition of the National Law Journal, an article discussed the rising rate of patent malpractice claims being filed against firms for prosecution mistakes (Sorry, no link - paid site). The article asserted that the risks of being sued are not keeping up with the rewards, noting that “run-of-the mill prosecutions can net law firms as little as $800 and even more specialized versions can net them only $5,000.” With the number of malpractice claims going up, more firms were likely to end their prosecution practice.

What is the cause of all of this malpractice going on? Well, the article opines, it may be that in 2005 we had 390,733 new utility applications filed, while in 1996, we had 212,377 applications, an 84% increase in work load. You would certainly expect that patent prosecutors under extreme price pressure would file an increasing number of patent applications that give rise to more malpractice claims. If we reduce the number of applications being filed by increasing the fees, the pressure to file will be reduced and clients will be less likely to force their patent counsel to accept such small margins. Fewer patent applications will mean fewer deadlines missed resulting in less malpractice.

Wednesday, December 12, 2007

The New Rules - Patent Demand By Proxy

The USPTO has recently proposed significant modifications to the prosecution and appeal rules under which patents are granted (here for example). In my estimation (and with some confirmation by the GC of the office - see here), the rules are an attempt by the USPTO to reduce the number of patent applications that it has to examine, or Patent Demand By Proxy.

Of course, the proposed rule-making has created a backlash in the patent holder and prosecution communities because of the damage that the new rules would do to patents and the patent process. The secondary effect of the proposed rules is to drive up the expense of filing and prosecuting patent applications through increased patent applications filed and increased legal bills for complying with the rules. The first set of proposed rules were postponed by a lawsuit filed by GSK, and I would expect a similar result with the second and third sets. However, the USPTO could avoid all of this unpleasantness by simply increasing the filing fees it charges for large entities to a point where the supply of patent applications is reduced to a number that feasible to examine adequately.