USPTO Announces Rule Change in PTA Relating to Appellate Review

PTA Basics

Patent Term Adjustment (PTA), with its provisions codified at 35 U.S.C. §154(b), extends the term of a patent for certain examination delays at the USPTO. The non-overlapping sum of three kinds of Office delays, referred to by practitioners by their letter designations, A, B, & C, reduced by the delays attributable to the applicant, result in a day-for-day adjustment of patent term.

“A” delays under 35 U.S.C. §154(b)(1)(A)  and rules 37 C.F.R. §1.702(a) and 703(a) cover situations where the Office fails to come through on administrative milestones in examining the application such as mailing a first Office Action within fourteen months of the filing date or mailing subsequent office actions (rejection or Notice of Allowance) within four months of an applicant response.

Term adjustment due to “B” delays under 35 U.S.C. §154(b)(1)(B) and 37 C.F.R. §1.702(b) and 703(b) are based upon the USPTO failing to issue a patent within three years of the filing date of the application. The B-delay period does not include certain periods in the post-three year prosecution history of a patent such as the period after the filing of a Request for Continued Examination (RCE), the period during which an Examiner’s rejection is appealed to the Board of Patent Interferences and Interferences (BPAI)^[1] or a Federal court, and periods of delay due to interference proceedings or secrecy orders.

“C” delays under 35 U.S.C. §154(b)(1)(C) and 37 C.F.R. §1.702(c) (e)  and 703(c) (e) are adjustments to the term of the patent caused by USPTO delays caused  by interference proceedings, secrecy orders, and successful appellate reviews.

Applicant's failure to engage in reasonable efforts to conclude prosecution of the application are calculated under the provisions of  37 C.F.R. §1.704.

Summary of Rule Changes

Currently, if an applicant files a Notice of Appeal (N/AP) when the B-delay window is open, the B-delay is tolled starting on the date on which the N/AP was filed and ends on the date of the last decision (by the BPAI or Federal Court) or on the date of mailing of an Office action, if the appeal does not result in a decision by the BPAI. The C-delay that results from a successful appeal is counted from the date of the filing of the N/AP until the date of a final decision by the BPAI or Federal Court that is in favor of the applicant. As is apparent from the preceding description, there is a lack of symmetry in the application of the delay rules. The B-delay clock stops on the date that the applicant files an N/AP and resumes after there is a decision on the appeal or if the Office backtracks on its rejection, whereas, the C-delay only comes into play when the applicant is successful in appealing the rejection to the BPAI or Federal Court. In other words, if the Office were to reopen prosecution after the applicant filed the appeal brief, this is not treated as a successful appeal under §1.703(e) and the applicant gets no C-delay added to the patent term. Yet, the B-delay clock tolling deprives the applicant of a rightfully deserved adjustment of patent term. In this scenario, the applicant receives less PTA than what is rightfully due under the current rules.

In 77 FR 49354 (August 16, 2012), the USPTO in a Final Rule revised clauses within 37 C.F.R. §1.703 and 1.704 that relate to cases appealed to the BPAI or to a Federal Court and appears to have addressed the above inequity. The B-delay period under the revised rules is only tolled from the date that the jurisdiction of the appeal passes to the BPAI or Federal Court, until the date that there is a last decision by the appellate authority. The C-delay is counted from the date that the jurisdiction of the appeal passes to the BPAI or Federal Court up to the date of a final decision in favor of the applicant. Now, if the Office reopens prosecution after the applicant files the appeal brief, the C-delay is 0 days but there is no tolling of the B-delay since the jurisdiction was never passed to the BPAI or Federal Court.

The other revision to the PTA rules (the newly drafted rule §1.704(c)(11)) now penalizes the applicant for a delay in filing an appeal brief. While there is a three month deadline for almost all applicant tasks written in to 37 C.F.R. §1.704(b), the USPTO has now created an explicit category for an applicant delay during the appeal process.

The examples below illustrate some circumstances under which PTA changes will result from the revision of the rules.

Example 1-- Office responds to the applicant’s Appeal Brief with a Notice of Allowance

Facts:

Applicant files an application on January 1, 2008 and receives a Final Rejection on December 1, 2011. Applicant files an N/AP on January 1, 2012, files an Appeal Brief on March 1, 2012, the Examiner mails a Notice of Allowance on June 1, 2012, and a patent issues on August 21, 2012.

Current rule:

The B-delay in the absence of the notice of appeal would have run from January 1, 2011 (3 years from the filing date of the application) to August 21, 2012 (the issue date), a delay of 517 days. The application of current rule 1.704(b)(4) tolls the B-delay for the period between 1/1/2012 and 6/1/2012 (152 days) – reducing the B-delay from 517 days to 365 days. The current C-delay calculation in this case yields 0 days because none of the conditions of 37 C.F.R. §1.703(c) are met (the case was not successfully appealed to the BPAI or Federal Court).

New Rule:

Under revised rule §1.704(b)(4), there is no tolling of the B-delay (as the jurisdiction of the application never passed to the BPAI or Federal Court^[2]^) and the B-delay remains at 517 days. The C-delay is unchanged at 0 days. In this example, the applicant gains 152 days of PTA compared to application of the current rule.

Example 2 - Applicant files an RCE after filing a Notice of Appeal

Facts:

Applicant files an application on January 1, 2008 and receives a Final Rejection on December 1, 2011. Applicant files an N/AP on January 1, 2012 and files an RCE on May 1, 2012 and the Examiner mails a Notice of Allowance on June 1, 2012, and a patent issues on August 21, 2012.

Current Rule:

The B-delay in the absence of an appeal would have run from January 1, 2011 (3 years from the filing date of the application) to May 1, 2012 (the RCE filing date), a delay of 486 days. The application of current rule 1.704(b)(4) tolls the B-delay for the period between 1/1/2012 and 5/1/2012 (121 days) – reducing the B-delay from 486 days to 365 days. The current C-delay calculation in this case yields 0 days because none of the conditions of 37 C.F.R. §1.703(c) are met (the case was not successfully appealed to the BPAI or Federal Court).

New Rule:

Under the new rule §1.704(b)(4), there is no tolling of the B-delay (as the jurisdiction of the application never passed to the BPAI or Federal Court ) and the B-delay remains at 486 days. The C-delay is unchanged at 0 days. However, since the RCE was filed more than 3 months after the N/AP was filed, the applicant delay under the new rule §1.704(c)(11) is the time between April 1, 2012 and May 1, 2012 (30 days). In this example, the applicant gains 121 days of PTA.

Rule Changes:

The rule changes are as follows:

What to do next?

Immediate PTA checks 

• Identify whether any applications in your portfolio may be affected by these rule changes
• Review recently issued patents to determine if filing a timely petition to recalculate PTA will result in an increase in patent term.

Practice Tips 

• Avoid taking extensions after filing a Notice of Appeal after the new rule is in place

​If you need assistance with identifying applications and patents that might be affected by the rule changes Click here to contact us.

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^[1] The BPAI has been renamed as a result of changes in the law (the elimination of Interferences in a First to File system). The BPAI’s new name is the Patent Trial and Appeal Board (PTAB). In this article

we use BPAI throughout for the sake of convenience.

^[2]* *In an appeal to the BPAI, the jurisdiction of the application passes to the BPAI at the earlier of the date that a reply brief is filed or the expiration date of the period to file a reply brief.