OMB Delays Patent Office Appeal Rules

To quote Lee Corso of ESPN College Football Gameday fame — not so fast my friend!  The Office of Management & Budget (OMB) will not be able to complete its review of the Final USPTO Appeal Rules before they were to go into effect tomorrow, December 10, 2008, so OMB is forcing Jon Dudas and the Patent Office to delay implementation of these rules! 

I cannot remember OMB ever stepping in to stop a rules package of the PTO, but this really doesn’t come as much of a surprise to me given all of the trouble the USPTO has had with respect to getting any of its proposed rules into place.  As readers will undoubtedly recall, the USPTO has famously been prevented from implementing the claims and continuations rules, and the Federal Circuit is now considering the Patent Office’s appeal.  For a detailed chronology of the claims and continuations rules and their being enjoined see USPTO v. GSK & Tafas Chronology.

This will appear in the Federal Register tomorrow, December 10, 2008. 

On June 10, 2008, the United States Patent and Trademark Office (Office) published the final rule that amends the rules governing practice before the Board of Patent Appeals and Interferences (BPAI) in ex parte patent appeals. The final rule states that the effective date is December 10, 2008, and that the final rule shall apply to all appeals in which an appeal brief is filed on or after the effective date. On June 9, 2008, the Office published a 60-Day Federal Register Notice requesting the Office of Management and Budget (OMB) to establish a new information collection for BPAI items in the final rule and requesting public comment on the burden impact of the final rule under the provisions of the Paperwork Reduction Act (PRA). On October 8, 2008,  the Office published a 30-Day Federal Register Notice stating that the proposal for the collection of information under the final rule was being submitted to OMB and requesting comments on the proposed information collection be submitted to OMB. The proposed information collection is currently under consideration by OMB. Since the review by OMB has not been completed, the Office is hereby notifying the public that the effective and applicability date of the final rule is not December 10, 2008. The effective and applicability dates will be identified in a subsequent notice.

For an advance copy see Rules of Practice Before the Board of Patent Appeals and Interferences in Ex Parte Appeals; Delay of Effective and Applicability Dates.

As you may recall, on June 9, 2008, OMB requested public comment on the Patent Office’s estimates for paperwork burdens for the Appeal Rule. Specifically, comments were invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency’s estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. 

At the time the Appeals Rules were made final the Undersecretary of Commerce for Intellectual Property, Jon Dudas said:

These new rules will benefit both the patent community and the USPTO by fostering an ex parte appeals process with improved efficiency and clarity. By exchanging information and crystallizing the issues of the dispute earlier in the process, the result will be more streamlined appeal process and more efficient decision-making.

The thing that Dudas did not consider, however, was that the rules were really quite ridiculous in parts for no reason.  For example, in order to provide the type of table of contents required it would be unnecessarily time consuming.  Members of the patent bar pointed out that in the final review stage as edits are made page numbers often become changed with even modest adjustments.  The Federal Circuit rule allows one to reserve page numbers to handle this type of administrative nightmare, but the Patent Office rule did not allow for page numbers to be reserved or skipped, thus making a nonsensical formalistic requirement that would only present unnecessary administrative and clerical burden on those preparing and filing appeals without in any way affecting the substance or making the brief more friendly for the Judges on the Board.  The Patent Office merely concluded that there were off-the-shelf software solutions that could easily be employed.  Practitioners repeatedly asked the Patent Office to identify such software solutions so they could be acquired and use, but the Patent Office never to my knowledge identified any software that could be used, choosing rather to simply say it exists without further specification.

Unfortunately, the PTO followed rather unorthodox procedures in promulgating these Appeals Rules, and was not truthful with the OMB about the financial costs that would fall on the industry to comply with the rules.  Normally, an agency obtains Paperwork Reduction Act clearance at the time that a new rule is published as a Notice of Proposed Rulemaking, and the agency submits the rule to OMB shortly thereafter for review under Executive Order 12,866. However, in this case, the PTO certified to OMB that the total economic burden was essentially zero (which we all know to be simply untrue) and made no request for Paperwork Approval until the day before the publication of the Notice of Final Rule. Thus, even though the Appeal Rule was published as a final rule, the Patent Office could not enforce it because the PTO failed to timely seek OMB approval under the Paperwork Reduction Act.

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Gene Quinn is a patent attorney and the founder of

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