Because No One is Immune to the Law
June 13, 2023 - Intellectual Property, United States

USPTO Releases 2022‒2026 Strategic Plan

stack of documents

Last week, the USPTO released its 2022‒2026 Strategic Plan. The Strategic Plan outlines the USPTO’s overarching goals for the coming years. How are these initiatives likely to affect patent applicants and owners?

1. Improving patent application pendency

The USPTO is continuing its efforts to reduce patent application pendency (currently about 25 months to final disposition) by “reimagining patent examination processes” and by providing alternative application processing options for patent applications.

Based upon this initiative, the USPTO may continue to expand its offerings for expedited examination for certain technologies and/or expand the number of permitted annual Track I requests from the current level of 15,000. Practitioners should continue to take advantage of the available programs to expedite prosecution at the USPTO and be on the lookout for new mechanisms to expedite prosecution.   

2. Updating search strategies

Applicants can expect changes in USPTO search practices. While the practical impact of such changes is unclear, they may enable more reliable identification of the most relevant prior art.

First, the USPTO hopes to optimize the strategic integration of AI and robotic process automation (RPA) into the patent application system, including for enhanced and more efficient access to prior art.

Second, the USPTO plans to provide examiners with new training and tools to search databases maintained by the FDA. This builds on the unprecedented collaboration between the USPTO and FDA in 2022. Companies should ensure consistency in their patent and regulatory strategies and provide any relevant correspondence with FDA to the USPTO to comply with their duty of disclosure.

3. Potential small claims courts for IP litigation

The USPTO plans to independently study the feasibility of small claims courts for patents and trademarks, collect and analyze public comments, and submit a report to Congress. The report will indicate whether there is a need for small claims courts, the feasibility and potential structure of each court, and the relevant legal, policy, and practical considerations in establishing a small claims court for either patents, trademarks, or both.

Interested stakeholders should watch for future requests for comments regarding the small claims courts, for an opportunity to weigh in.

4. Scrutiny of micro and small entity designations

The USPTO makes it clear that it will be vigilant in identifying applications “including erroneous or suspicious designations of micro or small entity status,” particularly in view of the recent changes in the increasing associated fee discounts. The Unleashing American Innovators Act of 2022 increased small entity patent fee discounts to 60% (up from a 50% discount), and micro entity discounts to 80% (up from a 75% discount).[1] 

The Unleashing America Invents Act also changed the penalty for false assertions of entity status. Under the old law, fraudulent assertion of small entity status would be considered inequitable conduct that might jeopardize enforcement of the patent. But an incorrect assertion of small (or micro) entity status made in good faith could be “excused” upon correction of the entity status and payment of the fee deficiency.

Under the new law, the USPTO Director has discretion to impose penalty fines that are not less than three times the fee deficiency when an entity “is found to have falsely asserted entitlement to a fee reduction.”

Applicants should investigate and verify entitlement to small entity status before it is first claimed (e.g., when filing the application), again when the issue fee payment is made, and again when each maintenance fee payment is made.

5. Steps to curb abuse of Patent Trial and Appeal Board (PTAB) proceedings

The USPTO’s Strategic Plan notes that it will take “steps to prevent abusive behaviors from arising” in PTAB proceedings.

This sends a strong message that USPTO Director Kathi Vidal plans to carefully scrutinize PTAB proceedings for potential abuse. In 2022, for example, Director Vidal issued a decision finding that a petitioner abused the inter partes review (IPR) process by filing the IPR “in an attempt to extract payment” from the patent owner, and “by offering to undermine and/or not vigorously pursue this matter in exchange for a monetary payment.”[2] The decision was the first time a USPTO Director levied sanctions in a patent review.

[1] To qualify for “small entity” status, a business must have no more than 500 employees, including affiliates. 13 CFR § 121.802. Additionally, the business must not have assigned, granted, conveyed, or licensed any rights in the invention to any entity that does not qualify for small entity status (and must be under no obligation to do so). Id. Individuals and nonprofit organizations can also qualify. MPEP § 509.02. “Micro entity” status (which is rare) additionally requires that the applicant qualify on either a “gross income” or “institution of higher education" basis. 37 CFR § 1.29.

[2] OpenSky Industries, LLC v. VLSI Technology LLC, IPR2021-01064, Paper 102 (Oct. 4, 2022).