Utility patents are the best way to protect most inventions. But to get one, you have to convince a USPTO examiner that your application is worthy.
Utility patents are by far the most common type of patent. Thus, the term “patent” almost always means “utility patent.” Nearly all of the famous patents in history – the telephone, light bulb, transistor, airplane, motion picture, were utility patents.
Note the underlined new. You have to prove that the invention is original, and not just a trivial (obvious) tweak to some older prior art.
Here “useful” means that the invention must have some actual benefit (i.e., it isn’t clearly impossible or too illegal) and does more than just being decorative.
Utility patents are often the hardest type of IP to get. USPTO examiners usually attempt to use prior art to reject new applications. These rejections are called “office communications.” You must send in a written response rebutting these rejections. The review process may require several cycles of denial and response. If you do not successfully rebut the various rejections, the application goes abandoned.
Legally, a US patent gives the owner the right to sue to collect royalties/damages or to attempt to block someone else from practicing the invention in the United States. The patent claims determine the exact scope of legal protection. In practice, patents are most useful for financing, acquisitions, licensing, and other business purposes.
Patent valuation: Patent valuation is dictated in large part by the desires of others to practice the invention. If a particular patent covers something that no one else wants to practice, it isn’t going to be worth much! The effectiveness of a patent in thwarting these desires (what the claims cover), and the invention’s potential market size, are also significant.
Your utility patent will typically have a 20 year lifetime. However, you will have to pay maintenance fees at 3-4, 7-8, and 11-12 years after issue. You may get some extra life if the USPTO delays for too long. At the end of this time, your utility patent will expire and become public domain. If you don’t respond to USPTO office actions, your patent application will also become public domain.
Provisional patent applications: US patent law allows inventors (applicants) to file informally written disclosures with the US patent office. These informal disclosures are called “provisional patent applications.” These are also called “provisional patents,” “provisional applications,” or even just “provisionals.” If used correctly, they can help you start the process of obtaining a patent.
The USPTO doesn’t examine provisional patents. Instead, the USPTO merely stores them in their databases for a year. After a year, they expire, unless before expiration, you file a regular (non-provisional) utility patent application that references that provisional application. If you do this, the USPTO links the provisional application to the full patent application and preserves it.
Later, during the examination of the subsequent regular utility patent, you can reference the provisional patent to try to overcome various rejections. Usually, you do this to prove you were the first inventor to file. You can also use the provisional application to try to satisfy examiner requests for additional detail.
Provisional patent applications have few requirements, but be careful!
Regular patents have detailed requirements for format, figures, and claims. They tend to be expensive to file. By contrast, provisional patents have almost no format requirements, and they are often less costly to file. With the correct USPTO forms and fees, you can submit almost anything. As a result, provisional patent applications can be as simple as a single page photograph of a napkin sketch. They also can be as complex a fully developed 100+ page formal patent application. The USPTO will cheerfully accept either one of these.
The lack of format requirements can be helpful. Provisional applications are an easy way to put a lot of supplemental information on the record. This information can include research papers and user manuals, for example. These can be very useful for addressing subsequent examiner rejections.
The bad news, however, is that many a patent application has failed because the inventor first filed a poor quality provisional application. The real problem is if you submit something unsatisfactory and then operate under a false sense of confidence that you are protected.
Dangers of low-quality submissions:
The dangers of a poor quality provisional application are both delayed and subtle. At first, everything is fine. Then, typically about 1-3 years after you file the inadequate provisional, trouble can start.
For example, suppose that the USPTO examiner rejects on the basis that someone else has filed another non-provisional (standard utility) patent ahead of your regular utility patent. Under today’s rules, almost the only way to establish that you invented first is to cite your earlier filed provisional. You also have to show precisely which parts of the provisional application prove that you invented first.
If the examiner reviews the cited portions of your provisional and agrees, then the provisional application has been successful. You have overcome this rejection. But if the examiner reviews it and says, “I don’t see the invention here,” then you are in trouble. Your provisional has likely failed, and you may never be able to prove that you invented first.
Three different provisional strategies:
I think that it is useful to think about three different categories of provisional patents. These categories are: 1) quickly file your existing write-ups; 2) file a rough draft of a regular utility patent; and 3) file a complete utility patent, but do so as a provisional patent rather than as a proper utility patent.
Risky, fast, and cheap:
Category 1: quickly file your existing write-ups. These can be existing papers, PowerPoint presentations, handouts, whatever. The argument in favor of this approach is that this is the quickest way of getting something on the official patent record. This approach also lets you file a lot of supplemental information. Worst case, you can later abandon an improperly thought out provisional. My personal views are that this approach is better than nothing, but it is not without pitfalls.
An excellent way to go:
Category 2: file a rough draft of a regular utility patent. Inventors and small companies often operate on a limited budget and need to get something submitted on a short deadline. Here the goal is to try to file something relatively decent, but quickly and on a tight budget. Here, as a compromise between cost and quality, one way to go is to produce a rough draft of a utility patent. This rough draft follows the standard utility patent format, which provides some vital structure.
This approach tries to capture a good chunk of the value of a full patent application. It also seeks to keep costs at about 50% of a standard patent. Here, the trick is to focus on a few essential draft claims, informal but adequate figures, and at least the most critical technical aspects of the disclosure.
A tricky strategic option:
Category 3: file a complete utility patent, but as a provisional application. In this third type of situation, funding may not be an issue. You may want to do a quality job submitting what you have. However, you may also think that there is a possibility that you will make additional improvements to the invention over the next year. Here a complete and detailed utility patent is written. But instead of filing it as a regular utility patent, you submit it as a provisional patent.
This provisional application can then be “aged” for up to a year. If there are no changes, you can then refile it as a full utility patent. Otherwise, you can update your earlier provisional, and then file it as a full utility patent. An additional advantage of this Category 3 approach is that it can effectively increase the lifetime of the final patent by up to a year.
Remember the international filing deadlines:
A few other nuances – if you are interested in foreign patent filings, realize that the 12-month foreign filing deadline starts ticking from the time you file your provisional application. Thus the 12-month provisional expiration deadline, and the US and international patent filing deadlines, all fall on the same day.
The Hague system allows you to use one application to file design patents in many countries simultaneously, but it is quirky and doesn’t work everywhere.
Are you thinking of filing your US design patent application outside the US? For some countries like China and India, you will have to register locally. For other countries, such as Canada, Europe (EU), Japan, and Korea, consider using the Hague system. In either case, think fast, because the deadline is often just six months after your initial filing.
What is the Hague system? The Hague system (Hague Agreement Concerning the International Registration of Industrial Designs) is a series of international treaties. These treaties allow applicants from participating countries to register design patents in other participating countries directly. If you or your company is not a resident of a participating country, you are out of luck. You must get international coverage the hard way by finding a local representative and filing with the local patent office.
The US signed up in 2015. Other countries are also in the process of joining but are not in yet. There are presently 66 countries participating. So as the map shows, coverage is still somewhat uneven.
The rules are not uniform.
The drawing requirements and extent of post-filing examination can vary between countries. The EU, for example, limits design drawings to a maximum of seven views, but otherwise, acts as a registration system that doesn’t require much subsequent effort. By contrast, like the US, Japan also requires examination as well. So in Japan, as well as the US, the applicant must thus do additional activities and pay additional fees.
Unlike US design patents, the Hague system allows you to register multiple related designs in one application. However, for those thinking of gaming the system for US design patents, realize that the USPTO will require you to select just one design. The US will require you to pay extra to examine any other versions. Still, if you have a large number of variations, this is an option to consider. However, note that the Hague system also publishes all design applications within six months of filing, while the US does not. So the Hague system offers less confidentiality.
You must pay maintenance fees on your Hague system registrations every five years. These last for up to a total of 15 years of total coverage. By contrast, after a US design patent has issued, the USPTO will give you 15 years of coverage with no maintenance fees.
How to file
Like other patents, the USPTO will accept Hague system patent applications and forward them on to the international office in Switzerland. If your design patent has not yet previously passed a security review and obtained clearance, then you should (must) file via the USPTO first. However, if you have clearance (e.g., you have previously filed in the US and received international filing approval), then use the Hague’s E-filing system. It is both quicker and easier.
Is your examiner repeatedly insisting that your patent application claims are obvious? One option: “reboot” your examiner by submitting at least one Rule 132 declaration providing “secondary considerations of nonobviousness.”
Without “obvious” type rejections, we would have a lot of trivial patents. So such rejections are needed, but the problem is that the USPTO usually goes too far. The USPTO determines obviousness by considering if the invention would be evident from the standpoint of an imaginary Person Having Ordinary Skill In The Art (PHOSITA). This test is ultimately just legal guesswork. As previously discussed, such determinations are often unduly influenced by hindsight bias.
35 USC 103 rejections
Does your examiner keep rejecting your patent under 35 USC 103 as being “unpatentable?” These 35 USC 103 rejections are another term for obviousness-type rejections.
Objective indicia of nonobviousness (outside evidence)
If you are getting stuck, you should know that you can also rebut obviousness rejections by submitting “objective indicia of nonobviousness.” (outside evidence). This external evidence can include unexpected results, commercial success, long-unsolved needs, failure of others, professional approval, skepticism of experts, and the like.
Although allowed, the USPTO considers such outside evidence to have a second-class status. You can even see this in the terminology: “secondary considerations of nonobviousness.”
The patent legal system prefers its imaginary PHOSITA reasoning over actual real-world evidence! Sounds silly, but remember that they are skeptical because applicants are always trying to game the system.
A rare but useful trick
Applicants don’t submit outside evidence very often. Indeed, given the 2007 KSR removal of anti-hindsight rules, the tactic is underused. However, in my opinion, it is a useful “in an emergency, break glass” kind of tool. You use it when you want to try to break the examiner out of a mental “rut,” or even a mental “infinite loop” of obviousness rejections.
When to submit “outside evidence?”
When to use it? Obviousness rejections are routine. It usually takes at least two office actions to see if the examiner is showing signs of having a non-negotiable “I still think it’s obvious” position. If this seems to be the case, you can submit outside evidence and try to “reboot” the examiner. Your secondary considerations of nonobviousness might break the examiner out of this infinite loop.
USPTO rules on outside evidence
According to the USPTO examination rules, MPEP 716.01(d) Weighing Objective Evidence… “When an applicant timely submits [outside] evidence traversing a rejection, the examiner mustreconsider the patentability of the claimed invention.”
You submit outside evidence as various “Rule 132 declarations.” These Rule 132 declarations should first state the identity and the credentials of an outside declarant. The declarant should ideally be an expert who is not a member of your company and is not a co-inventor. Next, your declaration should then state the relevant outside facts. Finally, the declarant must sign the statement. You should try to find credible individuals for this, and to submit the best evidence available.
Expect the USPTO to be skeptical.
Due to USPTO concerns that the outside evidence is unreliable, this is not a sure tactic. The rules state that there must be a “clear nexus” between the extrinsic evidence and the invention’s claims. The examiner may rebut by arguing that no such clear nexus exists, proposing alternative explanations, and looking for other ways to discount the declaration. Still, if you do have good evidence, why not use it?
Summary:In general, software patents that deal with technical effects, physical parameters, and improving computer function tend to be favored. By contrast, international software patents focused on business methods tend to be disfavored.
China: Before April 2017, China restricted software patents to methods that solve technical problems, control internal or external processes according to the laws of nature, and produce technical effects in accordance with the laws of nature. Machine-readable medium type claims, and game patents, were not allowed. However, these guidelines are now somewhat more expansive. For example, business methods that also have a technical aspect may now also be eligible for patent protection.
Europe: Software patents should have a “technical effect” (e.g. controlling industrial aspects, improvements in computer technology, data pertains to physical properties,). Pure methods directed “only” to doing business and computer programs without “technical effect” are not allowed.
United States: The rules are presently somewhat incoherent. Traditionally (before 2014-2015) US policy was permissive. Indeed the present written (i.e. statutory) US legal standard is that all types of software patents are permitted. However, the latest judicial rulings and USPTO policies are that at least some software patents may represent “abstract ideas” run on “generic computers” that are not patentable unless there is “something more”. Unfortunately the terms “abstract”, “generic computer” and “something more” are effectively undefined (and thus can vary according to the whims of the judge or patent examiner at hand).
How will US software patent rules evolve in the future? This is a bit like reading tea leaves, but the latest US software patent decisions appear to be trending more towards a Chinese or European-like approach. On average, “business method” software has a higher risk of being rejected as being “abstract”. However, software that exhibits technical effects, operates on data pertaining to physical properties, or improves computer function is often accepted on the basis that it is not “abstract”, not run on “generic computers” or contains “something more”. Arguably the US, presently lacking coherent rules, may be at least temporarily filling the void by borrowing rules from other countries. The constitutionality of this approach remains to be determined.
Legal confusion: There remains a lot of legal confusion in the US regarding the question, are software inventions patentable? How to answer this question? We could, of course, look at the letter of the law (e.g. 35 USC 101), which would give us the rather boring answer that software is patentable. But if someone doesn’t want software to be patentable (and a number of large powerful companies do not), that’s not the answer they want.
How else might we get an answer? In ancient Greece, we might consult the Oracle at Delphi, or perhaps sacrifice a goat and examine its entrails. However, in the modern US, we know that this is silly. As we all know, the modern US way to decide this is to put this question to a small panel of elderly individuals who know nothing about software, science, technology, or patent law. We call this small panel the Supreme Court of the United States (SCOTUS).
To answer questions, the Oracle at Delphi inhaled vapors, fell into a trance, and then spoke in riddles. These were then interpreted by various priests. In much the same way, SCOTUS (hopefully without the aid of vapors) has given us some confusing and inconsistent rulings, such as the CLS Bank v. Alice Corporationdecision, that in essence are riddles that must be interpreted by various priests (e.g. lower courts, the USPTO).
So in “Alice”, SCOTUS told us that “abstract ideas” are patent ineligible, and also told us that “In any event, we need not labor to delimit the precise contours of the “abstract ideas” category in this case. It is enough to recognize that there is no meaningful distinction between the concept of risk hedging in Bilski and the concept of intermediated settlement at issue here. Both are squarely within the realm of “abstract ideas” as we have used that term.”
So the ruling, in essence, is the riddle: “abstract ideas are not allowed“, and “abstract ideas are undefined”. This is a pretty good riddle. So the next step is, now that the Oracle (err… SCOTUS) has spoken, how are the various priests (err… the USPTO and lower courts) going to interpret this riddle?
The USPTO has thousands of patent examiners, and collectively they examine thousands of patents a day. They can’t run each patent application by SCOTUS and wait for 5 out of 9 judges to make a decision.
The USPTO problem has been further compounded by the fact that lower federal courts, over hundreds of different trials, have issued hundreds of often contradictory patent eligibility rulings. For every ruling that clarified an issue, there are at least one or two other rulings that amplify the confusion. As a result, all anyone has to do to support their desired outcome is to pick and choose among the hundreds of cases. Then string together an argument using these selected cases.
Some USPTO examiners update their analysis based on the latest guidelines, and some do not. Some are so conservative that they won’t approve a given claim as patent-eligible unless it is almost identical to a small list of approved patent-eligible claims.
The courts ignore the USPTO guidelines and continue to do whatever they want. Each new ruling adds to the legal confusion. Nobody reads the actual, Congress passed, 35 USC 101 law anymore.
The “Alice” case was aptly named, but “Wonderland” is not a nice place.