Thursday, March 14, 2024

First-Time Inventors Receive Boost from U.S. Patent Office

A patent portfolio can be one of the greatest assets that a company owns.

Patented technology provides value to a company that can lead to improved sales, revenue growth, and increased investment. Patents can convey great value and provide many avenues for sustaining and growing business operations. The exclusionary power of the patent right can create a foothold for innovative technology and enable a company to stake out territory that forces competitors to design around the patents, license the technology, or risk being sued for infringement. Patents also provide a basis for continued innovation and expansion through investment in R&D, covering improvements in technology, increasing the zone of exclusivity, influencing the prevailing state of the art, and tapping into new areas. And they provide added cachet in the marketplace: there is an inherent PR benefit to being able to advertise patented technology.

For a start-up, securing patent protection, and doing so quickly, is essential to the success of a burgeoning business. Investors and customers alike appreciate innovation, and even more so when proper steps have been taken to protect new ideas from copycats.

But increased backlogs at the U.S. Patent and Trademark Office (USPTO) have meant that many start-ups must wait several years before a formal patent is awarded on their critical technology. Instead, they must navigate the market relying on the nebulous “patent pending” designation, which, while often capably acting as a deterrent against infringement, is still not as good as having actionable patent rights.

In January 2024, the USPTO estimated the average First Office Action Pendency for patent applications – that is, the average number of months from the patent application filing date to the date a first written notice of findings (an “Office Action”) is issued by the USPTO – to be 20.4 months. The USPTO estimated the Traditional Total Pendency period for applications – that is, the average number of months from the application filing date to a final disposition (either issued as a patent or abandoned) – to be 25 months. These time periods are often longer for more complex technologies, such as computer software, biotech, and chemical-based cases. For start-ups, these delays can inhibit desired marketplace growth.

Recognizing the barriers such delays in the patent process create for first-time inventors and new start-ups, the USPTO, collectively with its Council for Inclusive Innovation (CI2), developed the First-Time Filer Expedited Examination Pilot Program.

Introduced on March 9, 2023, the Program was designed to increase accessibility to the patent system for inventors who are new to the patent application process. The Program is also aligned with efforts from the White House to encourage more equity and diversity in innovation, including assisting those in historically underserved geographic and economic areas. Participants in the Program are given “special status,” meaning that their applications will be advanced out of turn for examination and reviewed earlier than other applications filed at the same time. This advantage could possibly cut the pendency time for an application in half, securing an issued patent within a year from the filing date.

On March 8, 2024, the USPTO announced an extension to the Program. To participate in the Program, new applicants must submit a petition certifying the following:

  • Each joint inventor has not been named as an inventor on any other nonprovisional application;
  • Each joint inventor qualifies for “micro entity” status under the gross income basis requirement; and
  • Each joint inventor is reasonably trained on the basics of the USPTO’s patent application process.
There is no extra petition fee, so long as each of these requirements have been met.

Petitions may be filed until March 11, 2025, or until 1000 applications have been granted special status under the Program, whichever occurs first. To date, over 350 petitions have been filed requesting participation in the Program, with 145 having been granted special status and 15 patents being granted within the past year.

The benefits gained from participating in the USPTO’s First-Time Filer Program, including speedy issuance of valuable patent rights, can provide a significant boost to a start-up looking to take full advantage of its innovative assets.

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