RCE/National Stage Kerfuffle: PTO Creates a Nightmare Scenario
Much has been written lately about the USPTO’s recent enforcement of its controversial interpretation of filing Requests for Continued Examination (RCE) in National Stage applications (i.e., applications under 35 U.S.C. §371) where the oath/declaration was not filed prior to filing the RCE. This post will not address the legal merits of the USPTO’s position.
Perhaps what is most perplexing to the patent community is the timing of the enforcement of this interpretation. This unexplainable delay has led to a widespread, and even unappreciated, impact upon granted patents as well as pending applications. Even cute names such as “zombie patents” have crept into patent parlance as patentees and practitioners alike grapple with the scope and impact of this new enforcement. But the reality is that this situation is anything but cute.
In this post, I explore:
Part 1: How we got here
Part 2: Pending Applications
Part 3: Granted Patents
Part 1: How We Got Here
At issue is 35 U.S.C. §132(b), which provides:
(b) The Director shall prescribe regulations to provide for the continued examination of applications for patent at the request of the applicant. The Director may establish appropriate fees for such continued examination and shall provide a 50 percent reduction in such fees for small entities that qualify for reduced fees under section 41(h)(1).
The regulations that the Director prescribed appear in 37 C.F.R. §114, which provides in relevant part:
(a) If prosecution in an application is closed, an applicant may request continued examination of the application by filing a submission and the fee set forth in § 1.17(e) prior to the earliest of…
(e) The provisions of this section do not apply to…
(3) An international application filed under 35 U.S.C. 363 before June 8, 1995, or an international application that does not comply with 35 U.S.C. 371;
Inexplicable and Prejudicial Delay
Many commentators, and even some within the USPTO, have suggested that this impact dates back to 2015 when the USPTO made certain regulatory changes to Implement the Hague Agreement Concerning International Registration of Industrial Designs; however, this is not accurate. The problem potentially applies to every National Stage application that is subject to the America Invents Act (“AIA”) amendment to 35 U.S.C. §115 (amended Sept. 16, 2011, Leahy-Smith America Invents Act, Public Law 112-29, sec. 4(a), 125 Stat. 284, effective Sept. 16, 2012). In other words, not just applications dating back five years are at issue, but more accurately every National Stage application filed under the AIA over the past eight years is potentially at risk.
But how did we get here? Why now?
The simplest answer is that the USPTO’s position flew under the radar because (1) prior to the past couple of months, the USPTO has not enforced this interpretation and has instead let countless patents grant that do not comply with this interpretation, and (2) the USPTO’s position runs contrary to the objectives of the AIA and the Patent Law Treaties Implementation Act of 2012 (“PLTIA”). Thus, patentees and practitioners were (falsely?) led to believe that the amendments to 35 U.S.C. §115 following the AIA applied equally to all applications regardless of national origin and irrespective of whether the application was a National Stage or a non-provisional claiming Paris convention priority. The general thought was that this would, logically, extend to RCE practice as well.
The problem first arose with the June 20, 2020 revision of the MPEP. In this revision, the USPTO updated §706.07(h) pertaining to RCEs. The biggest change to this section is that the USPTO added the following paragraph:
For an effective request for continued examination (RCE) to be filed in a 35 U.S.C. 371 national stage application, all required inventor’s oaths or declarations (or substitute statements) must be submitted in the application prior to or with the RCE, notwithstanding 37 CFR 1.495(c)(3) permitting an inventor’s oath or declaration to be postponed until an application is otherwise in condition for allowance. In accordance with 37 CFR 1.114(e), an RCE cannot be filed in an international application that does not comply with 35 U.S.C. 371; 35 U.S.C. 371(c)(4) requires submission of the oath or declaration by the inventor(s) or a substitute statement. (emphasis added)
Prior to the formal preparation of the June 20, 2020 update of the MPEP, the USPTO did not enforce this position. I suspect that the USPTO would be hard-pressed to identify even a single application in which they issued a notice of improper RCE citing this interpretation prior to putting the MPEP revision in process to publish.
The USPTO defends its position by pointing to Changes To Implement the Hague Agreement Concerning International Registration of Industrial Designs, 80 FR 17917, 17930 (Apr. 2, 2015). This Notice issued five years before the USPTO started enforcing their interpretation. However, the issue goes back even further.
The 2015 Notice that the Office points to relates to the Patent Law Treaties Implementation Act of 2012 (“PLTIA”) which was passed by Congress in December 2012 and became effective on December 18, 2013. In other words, the USPTO took over two years to amend the regulations in response to the PLTIA, in addition to the five years it took to actually apply the interpretation. But the chain continues.
The true origin of the USPTO’s position, as noted above, is Changes To Implement the Inventor's Oath or Declaration Provisions of the Leahy-Smith America Invents Act, 77 FR 48775, (Aug. 14, 2012) at 48777, 48780, 48795, in which the UPSTO makes specific reference to at 80 FR 17917, 17930. Here the USPTO explains:
The Office recently revised its rules to permit applicants, including applicants in national stage applications under 35 U.S.C. 371, to postpone filing the inventor's oath or declaration until the application is otherwise in condition for allowance (subject to certain conditions). See Changes to Implement the Inventor's Oath or Declaration Provisions of the Leahy-Smith America Invents Act, 77 FR 48776 (Aug. 14, 2012) (final rule). An international application, however, does not comply with the requirements of 35 U.S.C. 371 until the application includes the inventor's oath or declaration. See 35 U.S.C. 371(c)(4); see also 77 FR at 48777, 48780, 48795 (explaining that the inventor's oath or declaration is still required for a PCT international application to comply with 35 U.S.C. 371, notwithstanding the changes permitting applicants to postpone filing the inventor's oath or declaration until after a PCT international application enters the national stage)
Despite the USPTO having this interpretation for eight years, only now has the USPTO started enforcing their interpretation. However, the USPTO has not published any specific points or guidance on this topic, much less any explanation of how their past lack of enforcement should be taken.
In fact, yesterday our firm contacted the Office of Patent Legal Administration (OPLA) at the USPTO to discuss this issue. OPLA has been given a series of “talking points” by the Office of Petitions, but neither OPLA nor the Office of Petitions has any statutory authority, regulations, nor jurisprudence to point to that supports its advice to applicants on what to do with pending cases. More problematic is that the USPTO is refusing to “weigh in on issued patents”, perhaps trying to find a way to ignore any culpability that they have.
The very definition of arbitrary and capricious
It is hard to prognosticate where this will go, but it seems that the USPTO’s treatment is the very definition of arbitrary and capricious in terms of enforcement. First, the USPTO elected not to enforce this interpretation for nearly eight years, only now rolling it out for enforcement. Second, the USPTO appears to be adopting a waiver of 37 C.F.R. §1.114(c)-(d) while enforcing 37 C.F.R. §1.114(e). Third, OPLA indicated that in cases where the oath/declaration was already received after the improper RCE, they will not be mailing out notice of abandonments for prior improperly filed RCEs, which implies that they may be implicitly waiving 37 C.F.R. §1.114(e) for pending cases. Fourth, OPLA stated that the USPTO will not weigh in on issued patents, yet they do weigh in as their “talking points” state that where continuity is of concern, applicants should consider filing a petition to revive in the patented parent case in order to preserve continuity, thus implying that they are not considering waiver of 37 C.F.R. §1.114(e) for granted patents. Fifth, the USPTO’s position runs contrary to the objectives of the AIA and the Patent Law Treaties Implementation Act of 2012 (“PLTIA”). It certainly will be interesting to see where the legal challenges go.
Part 2: Pending Applications
Pending Cases With Notice of Improper RCE Where an Oath/Declaration is not Filed
The proper course for pending cases that received a notice of improper RCE where an oath/declaration has not been filed is relatively straightforward. In these cases, it is pretty clear that the proper remedial action is to file the executed oath/declaration along with a new RCE, and payment of the RCE fee. In this situation, it appears likely that the USPTO will apply the previously paid RCE fee at the applicant request.
However, what happens when the notice of abandonment was issued for an RCE that was filed a couple of years ago? The answer to this question is that applicants must file a petition to revive under 37 C.F.R. §1.137 for unintentional abandonment. In addition, applicants must file a proper RCE, payment of the first RCE fee, and the necessary oath/declaration. It is not clear at this time if the USPTO will apply the previously paid RCE fee at the applicant request; however, it may be worth trying or paying a second time and requesting a refund.
In the vast majority (if not all) of the cases in this category, substantial prosecution has occurred between the RCE filing and the notice of abandonment. What happens to the prosecution history once the petition to revive is granted? Where do we pick up examination?
37 C.F.R. §1.114(c)-(d) implies that applicants have to “go back in time” before the improper RCE was filed and ensure that they meet the submission requirement. But what submission is required? Would the oath/declaration be all that is required? In the overwhelming majority of cases, when the RCE was filed it was to obtain entry of a response to the (then) outstanding Office Action. Accordingly, 37 C.F.R. §1.114 appears to effectively reset prosecution to a point that could be several years ago and also requires that in addition to the oath/declaration, the RCE must request entry of a compliant response to the preceding, e.g., final office action and that prosecution should restart from that point.
When OPLA was asked about this issue, they stated that once the petition to revive is granted the status of the application will return to the status held just before the notice of abandonment. If there are outstanding due dates, those dates will be reset. However, where is the basis for this position in the statute or regulations? Moreover, beyond the OPLA talking points, there is no public notice or guidelines to address this issue or upon which applicants can rely.
So, based on the OPLA talking points, is the USPTO waiving the requirements of 37 C.F.R. §1.114(c)-(d) while enforcing the requirements of 37 C.F.R. §114(e)? No wonder the patent community is confused.
Part 3: Granted Patents (The Real Problem)
What to do About Granted Patents?
This is the true conundrum that is no doubt keeping many practitioners awake at night. For the past eight years following the AIA, National Stage applications were prosecuted in good faith and in a manner that was believed to be in full compliance with the patent statute and regulations. Evidence to this effect was provided in the form of a granted U.S. patent. Now, the USPTO has called the validity and enforceability of those patents into question.
As the USPTO “talking points” state that they will not weigh in on issues related to granted patents, there really is no clear answer at this point. Further, it is highly likely that resolution of this issue will take years to work through judicial scrutiny.
First and foremost, the USPTO will not issue a notice in a granted patent that an improper RCE was filed during prosecution. Further, patentees have no obligation to do anything at the USPTO if such a situation exists. But, can a patentee rely upon a patent that was granted in a National Stage application with an improper RCE? Should the patentee proactively do something to “correct” the “problem”? Is there even a “problem” to “correct”? If there is a “problem,” how do you “correct” it?
There are many schools of thought on this issue which loosely follows as:
1) Do nothing because the patent is of little value or the issue isn’t all that interesting;
2) Take the view that the USPTO’s failure to raise this issue during examination constitutes a waiver of 37 C.F.R. §114(e);
3) Take a measured approach where you wait and see if, and when, this issue is litigated, then address as needed;
4) Take a proactive approach where, for example, the patentee files a petition for revival under 37 C.F.R. §1.137(a) for unintentional abandonment, along with a copy of the already-filed signed oath/declaration, an RCE, and a brief cover page explaining why this is being done.
Arguments can be made ad nauseum about which of these approaches is best approach, but they are each fraught with potential adverse consequences. For example, (1) and (2) may put the patent’s enforceability in jeopardy. (3) may run the risk that the USPTO’s position is held to be proper and that any remedial action at that time will be considered “late.”
However, the one that may raise the most concerns is (4). This procedure raises more questions and potential problems than it seeks to solve. Some include:
- As the patent is granted, can patentee even file a petition for revival?
- If patentee can file a petition for revival, should the RCE also request entry of the last response filed before the first improperly filed RCE?
- What happens to the prosecution history after the first improperly filed RCE?
- If the petition is granted, does this reopen examination subjecting the patent to the evolving (and sometimes incorrect) examination standards related to 35 U.S.C. §101 and §112, as well as a new prior art search and specious obviousness rejections?
- Does the filing of a petition for revival trigger a new duty to disclose obligation under 37 C.F.R. §1.56?
- What is the impact if the USPTO denies the petition for revival?
Herein lies an impossible riddle. Once the patent is granted, regulatory provisions such as a petition to revive for unintentional abandonment are not generally available except for the limited purpose of reviving due to failure to pay a fee. However, if an application was abandoned, then it cannot be patented.
If patentee files a petition to revive for unintentional abandonment, they have essentially admitted that the patent should have been abandoned as of the first RCE filing (i.e., the patent is void ab initio). The granting of that petition then should mean that examination is still open starting with the properly entered RCE/response in accordance with 37 C.F.R. §1.114(c)-(d) as noted above. Accordingly, the granting of the petition should be viewed as effectively erasing the prosecution history (except the bad stuff under Festo) after the case was “abandoned” as it is a legal impossibility to prosecute and secure a patent on an abandoned case. This would reset examination to the point in time where the first improper RCE was filed, unless of course the USPTO is sua sponte waiving 37 C.F.R. §1.114(c)-(d) in response to enforcing 37 C.F.R. §1.114(e).
Unfortunately, this is largely unchartered territory. If we apply the OPLA talking points to granted patents, then it would appear that if the USPTO grants the petition, then the failure to file a proper RCE would be cured and the application that matured into the patent would remain a patent. However, what is the legal basis to conclude or USPTO statement to support that if the petition is granted that it would or should remain a patent. Can this even be true legally or procedurally?
There are other options available for the correction of patents, which may be more appropriate under the circumstances.
Reissue – As noted above, the petition to revive route above is an admission that the patent was void ab initio and is akin to the “partially or wholly inoperative or invalid” standard for filing a reissue application. Thus, as opposed to wading into legally unchartered and perhaps improper waters of filing a petition to revive, the more appropriate route may be to file a reissue application.
However, a reissue application would be costly. Further, if granted, it is well-established that the reissue application would subject the entire patent to examination de novo. As such, this may be an undesirable route, is unlikely to bring a better outcome than the petition to revive route, is likely to cost more in the long-run, is likely to lead to a reduced claim scope, and is likely to take substantially longer to resolve. This route may at least help put to rest the procedural concerns and the “where does examination start” questions.
Supplemental Examination – The option that seems to be almost forgotten is that of supplemental examination. This issue appears to be tailor-made for supplemental examination and should provide a favorable resolution of the issue. Supplemental examination under 35 U.S.C. §257 provides patentees the opportunity to request supplemental examination of a patent by the USPTO to consider, reconsider, or correct information believed to be relevant to the patent.
The information presented in a request for supplemental examination is very broadly construed by the UPSTO. The information is not limited to patents and printed publications, and may include, for example, issues of patentability under 35 U.S.C. 101 and 112, a document related to factual information, priority information, a declaration under 37 C.F.R. §1.132 submitted during examination. (see 37 C.F.R. §1.605 and MPEP §2809). The improper timing of the oath/declaration with respect to an RCE is based upon a written document and should fall squarely within the information that the USPTO should consider as proper supplemental examination.
Within three months of the receipt of a request for supplemental examination (meeting the requirements of 35 U.S.C. §257 including the requirements established by the USPTO), the USPTO shall conduct a supplemental examination and conclude the supplemental examination proceeding with the issuance of a supplemental examination certificate. The supplemental examination certificate shall indicate whether the items of information presented in the request raise a substantial new question of patentability.
It is hard to envision a scenario where the USPTO would find the submission of an oath/declaration in a National Stage application after the filing of the first RCE to raise a substantial new question of patentability or to order reexamination. As such, if this route is followed, the USPTO should promptly issue a favorable supplemental examination certificate. Moreover, the receipt of a favorable supplemental examination certificate would also put to rest any possible allegation of inequitable conduct related to this issue.
Of note, however, the supplemental examination route is slightly more expensive than the petition to revive route, but likely much less than the reissue route. Specifically, the supplemental examination route would cost $4400 under the current USPTO fee schedule, while the petition to revive would be $2000 plus an additional $1300 for the first RCE. Despite the increased cost, this route would subject the patent to less uncertainty in the process and should be resolved promptly and favorably. Therefore, if patentee believes that some action is necessary, supplemental examination should be strongly considered.
The Continuity Problem
Aside from the patent being important, the question remains whether there is a compelling reason to take any action in a granted patent. Flying under the radar, but one of the more devastating impacts of the USPTO’s position, if it is allowed to stand, is that it possibly creates a continuity problem. Here lies yet another almost impossible question to answer and perhaps an even harder problem to properly resolve.
When a later-filed application claims benefit of a prior-filed non-provisional application under 35 U.S.C. §120, 121, 365(c), or 386(c), the later-filed application must be co-pending with the prior application or with an intermediate non-provisional application similarly entitled to the benefit of the filing date of the prior application. Co-pendency as set forth in these clauses requires that the later-filed application must be filed before: (A) the patenting of the prior application; (B) the abandonment of the prior application; or (C) the termination of proceedings in the prior application.
Accordingly, if one accepts the USPTO’s current view that National Stage application is abandoned when an RCE is filed prior to the oath/declaration, then any continuation or divisional application filed after the improper RCE lacks proper co-pendency with the National Stage application. This could mean that each and every family-member patent, including those currently pending, are at risk or outright invalid under 35 U.S.C. §119(a) and/or 35 U.S.C. §102.
OPLA does include this issue in their talking points. Specifically, the talking points state that where continuity is of concern, applicants should consider filing a petition to revive in the patented parent case in order to preserve continuity. The talking points do not point to this as a “must,” but rather something that can be done if applicants are “worried about continuity”.
However, this leads us back to the conundrum above of whether the petition to revive route is legally or procedurally proper. Further, it is not clear that a reissue application or supplemental examination would resolve this issue or ensure that the requirements for co-pendency are met.
Suspension of the Rules as a Remedy?
From the OPLA “talking points” it is clear that the USPTO is making this up as they go without any regard for the potentially devastating impact of their position. Sadly, considering the substantial petition and, possibly, prosecution fees that the USPTO will collect with each affected application, it certainly does appear to be the “money grab” that many commentators have speculated. However, the USPTO is unapologetic and ducks getting involved in discussions of what consequences their most recent recalcitrance may have on the enforceability of an uncalculatable number of patents and pending applications. If the UPTO truly cared about this issue and its “stakeholders” the solution is really quite simple and clearly within the authority of the Director.
Specifically, the requirements for filing an RCE under 37 C.F.R. §.114, including the timing requirement for the oath/declaration in a National Stage application, is created by rule based on the authority granted to the Director under 35 U.S.C. §132(b). If fact, 35 U.S.C. §371(d) further grants the Director the authority to accept and establish fees for an oath/declaration filed after the date of the commencement under 35 U.S.C. §371(c). Thus, the filing of an oath/declaration is required under statute (35 U.S.C. §115 and 35 U.S.C. §371); however, the timing requirement for a proper RCE is set by rule (37 C.F.R. §1.114).
Accordingly, the Director can put this entire issue to rest by exercising his supervisory authority under 37 C.F.R. §1.183, 37 C.F.R. §2.146(a)(5), and/or 37 C.F.R. §2.148 and sua sponte waiving the requirements of 37 C.F.R. §1.114(e)(3) for all patents granted before June 20, 2020. If the Director expressly waives the requirements of 37 C.F.R. §1.114(e)(3) for all patents granted before June 20, 2020, then there can be no doubt as to the co-pendency requirement and Pandora’s box will be closed leaving the parade of evils safely secured.
Even if the Director will not take action on his own, for granted patents, patentees can always consider the option of filing a petition under 37 C.F.R. §1.183 asking the Director to waive the requirement in a National Stage application for an oath/declaration to be filed prior to an RCE. This same approach can be considered even for pending applications in which the oath/declaration is already filed, but after the first RCE.
Disclaimer: The views expressed in this post are those of the author. Any opinions expressed in this article do not necessarily reflect the views of Oblon, its partners, or its clients. This post is not intended to convey specific legal advice. As each situation has its own unique facts, please consult with a licensed attorney to discuss your own situation prior to acting.