PTO Fee Proposals

The America Invents Act granted the PTO the right, for the first time, to set its own fees.  Previously, PTO fees were set by Congress.

The PTO has now published its proposed fee schedule.  Not surprisingly, the fees are going up.  The PTO seeks to increase its funding to deal with backlog issues in applications and appeals.  But, as noted by Patently-O, the PTO is clearly also attempting to influence applicant behavior through its proposed fees.

Here are the PTO’s new fee proposals:

Basic filing, search, and exam fee:  $1,840 from $1,250 (up 47%);
More than 3 independent claims:  $460 each, from $250 (up 84%);
More than 20 toal claims:  $100 each, up from $60 (up 67%);
Request for Continued Examination (RCE):  $1,700 from $930 (up 83%);
Notice of Appeal:  $1,500 from $620 (up 142%), but the PTO proposes to waive the issue fee if the examiner withdraws the final rejection;
Proceeding with appeal:  $2,500 after examiner’s answer to move to board; there is no longer any fee for filing an appeal brief (was $620);
Issue and Publication fees:  $960 from $2,040 (DOWN 53%);
Maintenance fees:  $1,600, $3,600, $7,600 from $1,130, $2,850, $4,730 (up 42%, 26%, 61%, respectively).

The PTO notes that the combined filing/search/exam and issue/publication fees for obtaining a patent will actually decrease from $3,290 to $2,800.  Of course this means that rejected applications will be higher and issued patents lower.

These fees are a significant increase from the current system.  One could certainly argue that the basic filing fee should be raised to address the backlog, but a 47% increase seems a bit steep. 

The PTO’s count reform efforts to deal with RCE filings has obviously been a failure, such that it now proposes an 83% increase to the fee for filing an RCE in the hopes that this will discourage applicants from filing them.  Unfortunately, most RCE’s are dictated by examiners who refuse to consider anything after final rejection, so this will probably not help with that goal.  To truly reduce the number of RCE filings, the PTO needs to develop a better after final mechanism for handling amendments and finding patentable subject matter, as well as dealing with IDS submissions after the issue fee is paid.

The board is currently swamped with ex parte patent appeals.  To deal with this problem, the PTO proposes increasing the fees for filing a Notice of Appeal and proceeding to the board to $4,000, up from the current $1,240 ($620 for the notice and $620 for the appeal brief).  This is an increase of over 320%!  Again, that is unreasonable.  Perhaps the appeal problem should be attacked at the front end by improving examination and training examiners to work with applicants to find allowable subject matter during prosecution.  The one bone throne to applicants is that if the examiner withdraws the final rejection prior to the examiner’s answer (not an uncommon occurrence), the issue fee is waived.

The PTO is also proposing a significant increase in the maintenance fees due during the lifetime of the patent.  The stated reasoning is that by then the patent owner will know the true value of the patent and will have been able to reach the market for the patent.

Small/Micro-Entities

The above stated fees are for large entities.  Small entities (companies with less than 500 employees) will pay 50% of the stated amount. 

The real winners here are the new category of micro-entities.  Micro-entities receive a 75% discount on the stated fees.

To qualify as a micro-entity, the application must not include any inventor that have been named on 5 or more U.S. non-provisional patent applications.  The application must not be licensed or the inventors must not be legally obligated to license or assign the application to any entity that does not meet the micro-entity requirements.  The assignee and each inventor must have an income of less than 3 times the average gross income reported by the Department of Labor for the previous calendar year.

One group that successfully lobbied to be added to this definition are universities and “institutes of higher eduction.”  Thus, large entities will subsidize not only small or individual inventors, but also enormous universities with operating budgets in the billions of dollars.  A big win for them.

Next Steps

The PTO has sent the proposed fee structure to the Patent Public Advisory Committee (PPAC) and they will begin a series of public hearings.  PPAC will hold hearings, gather feedback from the public and prepare a report to the PTO.  After the hearings, the PTO will publish the final proposed rules on fees in the Federal Register, probably in June.  This will begin a 60-day comment period on the rules which they hope to implement by fall.

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2 Responses to “PTO Fee Proposals”

  1. PTO Numbers – January 2012 « INVENTIVE STEP Says:

    [...] within a reasonable time frame, which 81.9 months is not.  It seems that the current answer is a significant increase in the appeal fees.  The PTO is working hard to try to hire more judges and patent attorneys to work on this [...]

  2. Comments on Proposed Fee Structure Due to PPAC by Feb. 29 « INVENTIVE STEP Says:

    [...] part of its procedure to implement its proposed new fee structure, the PTO must consult with the Patent Public Advisory Committee (PPAC) prior to publication in the [...]

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