The USPTO Strikes Again: More First Action Final Rejections = More Money + Diminished Quality

September 17, 2020 – Article

While looking at a first action final rejection after an RCE that I received this week from an Examiner that I respect, I was asking myself why I had received what appeared to be such a shockingly improper action. The answer was provided to me during part of the on-going IPO annual meeting. 

The Examiner wasn’t wrong after all.  No, the USPTO simply (and dramatically) changed the language in MPEP 706.07(b): Final Rejection, When Proper on First Action, in the June 20, 2020 update.  Once again, the USPTO made this change without prior notice or public comment. 

MPEP 706.07(b) now states:

The claims of a new application may be finally rejected in the first Office action in those situations where (A) the new application is a continuing application of, or a substitute for, an earlier application, and (B) all claims of the new application (1) are either identical to or patentably indistinct from the claims in the earlier application (in other words, restriction under 37 CFR 1.145 would not have been proper if the new or amended claims had been entered in the earlier application), and (2) would have been properly finally rejected on the grounds and art of record in the next Office action if they had been entered in the earlier application.

The claims of an application for which a request for continued examination (RCE) has been filed may be finally rejected in the action immediately subsequent to the filing of the RCE (with a submission and fee under 37 CFR 1.114) where all the claims in the application after the entry of the submission under 37 CFR 1.114 and any entered supplemental amendments (A) are either identical to or patentably indistinct from the claims in the application prior to the entry of the submission under 37 CFR 1.114, and (B) would have been properly finally rejected on the grounds and art of record in the next Office action if they had been entered in the application prior to the filing of the RCE under 37 CFR 1.114.

Notably, the previous version of MPEP 706.07(b) used the language “are drawn to the same invention claimed in the earlier application” and “are drawn to the same invention claimed in the application prior to the entry of the submission under 37 CFR 1.114” to replace the emphasized text respectively. 

What is the difference? 

Prior to June 20, 2020, the USPTO could only properly issue a first action final rejection in a continuation or RCE when the same subject matter was presented (akin to an anticipation (102) standard).  However, now the USPTO has substantially broadened the scope of a first action final rejection to cover not just the same subject matter but also to cover “patentably indistinct” subject matter (akin to an obviousness (103) standard).  The only safe haven exists where the application contains material which was presented in the earlier application after final rejection or closing of prosecution but was denied entry because (A) new issues were raised that required further consideration and/or search, or (B) the issue of new matter was raised.

Apparently, the USPTO is actively training the examination corps on this new procedure.  As such, this means that we should be prepared for a substantial increase in first action final rejections.  Obviously, what this also means is that we should also be prepared for the corresponding substantial increase in government fees associated with filing an ever-increasing number of RCEs, just to obtain the same level of examination as applicants have seen in the past. 

Yet again, the USPTO seems to be trying to limit applicant’s ability to patent their inventions or at least limit their abilities to effectively advocate without substantial and punitive fees.  It seems like we have seen this show before. 

Perhaps what is more disturbing is that the USPTO seems to have slid several major procedural changes into the June 20, 2020 MPEP update without prior notice and/or comment.  All the USPTO has done is provided a Change Summary for the Ninth Edition, Revision 10.2019 available at https://www.uspto.gov/web/offices/pac/mpep/mpep-0005-change-summary.html.