1 PPAC Patents Operations Update June 18th, 2009

2 Filings, First Actions, & Backlog FY08 Backlog increased 1.4% Filings increased 6.1% 1st Actions increased 16.6% As of 5/31/09

3 Backlog Projections

4 Total Pendency Projections

5 RCE and Continuations Percentage of Total UPR Filings

6 Patent Pendency – FY 2008 and FY 2009 Technology Center Average 1 st Action Pendency (months) 1 4 th Quarter FY08 Average 1 st Action Pendency (months) 1 2nd Quarter FY09 Average Total Pendency (months) 2 4 th Quarter FY08 Average Total Pendency (months) 2 2nd Quarter FY Biotechnology and Organic Chemistry Chemical and Materials Engineering Computer Architecture Software Networking, Multiplexing, Cable, and Security – Communications Semiconductor, Electrical, Optical Systems Transportation, Construction, Electronic Commerce Mechanical Engineering, Manufacturing and Products UPR Total 4 th Quarter FY “Average 1 st action pendency” is the average age from filing to first action for a newly filed application. 2 “Average total pendency” is the average age from filing to issue or abandonment of a newly filed application.

7 Hires and Attritions Staff includes UPR Examiners, SPEs and academy trainers Corps FY 08 Hiring FY 08 Attrits FY 08 EOY Staff FY 09 Hires As of April

8 End-of-Year Statistics (FY 2008)  468,669 UPR applications filed  28,217 design applications filed  6.1% filing growth over 2007  9.5% attrition (9.9% in FY07, 10.6% in FY06)  Patents Staff is composed of the following: 6,055 examiners 414 Supervisory Patent Examiners 101 Quality Assurance Specialists 48 SPE/trainers for Patent Training Academy

9 Quality Results  Improving Quality is our Highest Priority Result2005 Result2006 Result2007 Result2008 Result 5.3% allowance error 4.6% allowance error 3.5% allowance error 3.7% allowance error 82% in-process compliance 86.2% in- process compliance 90% in-process compliance 92.2% in- process compliance 92.5% in- process compliance

10 Allowance Error Rate

11 Allowance Rate 41% Mid Year 2009

12 Performance Measures FY02-08 *As of May 2009

13 Appeal Conference Effects Actions in Response to Appeal Brief

14 Actions Per Disposal

15 Affirmance Rate* at BPAI by TC Technology CenterFY 06FY 07FY 08FY 09 (May 09) 1600 Biotech54%73%70%73% 1700 Chemical Eng.77%81%80%81% 2100 Computers60%68%76%79% 2600 Communications62%80%74%77% 2800 Electrical70%74%77% 3600 Mechanical50%63%70%74% 3700 Mechanical Eng.56%73% 74% Corps. Total62%72%74%77% * Affirmed and Affirmed in Part

16 Patents’ Initiatives And Projects Present and Future - Issues and Solutions

17 A Sample of the Strategic Plan Initiatives  Enhance Recruitment & Retention Efforts  Implement University Style Patent Training Academy  Expand telework initiatives  Explore the development of alternative approaches to examination in collaboration with stakeholders  Pilot Peer Review of Published Applications  Implement Accelerated Examination Initiative  Pilot First Action Interview  Continue increase of e-filing  Study/Pilot/Implement Worksharing amongst IP Offices

18 Hiring & Recruitment  Hiring Efforts FY 2008:1211 Examiners hired  Recruiting Targeted TV, print, radio, and Internet banner advertising: “Examine the Possibilities” Increased career and job fair participation Recruitment incentives Partnerships with universities

19 Training Academy  Eight month university style training academy Begun in FY 2006 Have begun 30 classes; graduated 22 o Nearly 2,289 new examiners graduated into the corps to date Facilitate more efficient training of large numbers of new hires; reduce early attritions  Foreign Examiners In Residence (FEIR)  Chief Scientist / Academy Professor Position

20 Outreach Programs n University Outreach –Educating students on intellectual property »Ensuring that students are thinking about protecting their own innovations »Ensuring that students understand the impacts of piracy and other forms of intellectual property theft »Ensuring USPTO name recognition »Ensuring that students know the advantages of a career at the USPTO –Creating a pool of potential hires who have a foundation of patent examination knowledge »Engaged with universities on hosting IP programs in their engineering and business schools –Leveraging university resources to train examiners »Webster University providing advanced legal training to senior examiners »3 part course on how patent litigators use prosecution history in infringement proceedings (enhances examiners understanding of the importance of file history accuracy and clarity)

21 Retention  Initiatives to develop USPTO as an “employer of choice”  “Maximum Opportunity” & “Maximum Flexibility”: Telework Hoteling Flexible work hours Retention bonuses Higher general pay

22 Patents Hoteling Programs  Patent Examiner Hoteling Program Over 1,500 Patent Examiners participating in the Patents Hoteling Program, since initiated in 2006 Program allows examiners to work from home 4 days per week with USPTO electronic tools Will add additional 500 examiners to program in FY 2009  TSS Hoteling Program Piloted from September 2006 to September 2007 Currently, 87 TSS hoteling Survey indicated high levels of satisfaction with pilot and desire to continue

23 Patents Teleworking & Laptop Programs  Over 2300 laptops distributed through PELP  Both Hoteling and Laptop programs show production gains in line with increase in total examination time, as well as improved morale and job satisfaction

24 Worksharing  Number of initiatives underway to promote examination efficiencies in participating IP offices.  Patent Prosecution Highway (PPH) An initiative which leverages fast-track patent examination procedures available in Partnering Offices to obtain patents faster and more efficiently. It permits Partnering Offices to benefit from work previously done by the other office, in turn reducing examination workload and improve patent quality. Full implementation (January 4, 2008) - JPO Pilot – UK IPO, CIPO (Canada), EPO, IPAU (Australia) and KIPO (Korea)

25 Worksharing - Foundation Projects Common documentation database (EPO): Assemble a common set of relevant patent and non-patent literature from around the world to assist patent examiners in their prior art searches Common approach for a hybrid classification (EPO): Enable joint and efficient updating of patent classification and facilitate reuse of work among the patent offices Common application format (JPO): Facilitate the filing procedure of each office by using a common application format and an electronic or digitized patent application filing (in XML) and subsequent processing and publication in XML Common access to search & examination results (JPO): Enable examiners to find one-stop references in the dossier information of other offices, such as search and examination results, and conduct priority document exchange (PDX) to reduce costs of ordering copies of priority documents for applicants and administrative costs of electronic processing for offices Common training policy (KIPO): Standardize the training of patent examiners at each office, helping examiners to produce equivalent results of search and examination at the five offices Mutual machine translation (KIPO): Help offices overcome the language barrier of patent information and allow greater access to each other's patent information Common rules for examination practice & quality control (SIPO): Execute patent examinations at a similar standard and quality through common rules of examination practice and quality control Common statistical parameter system for examination (SIPO): Establish a system of common statistical parameters for all examinations at the five offices; and conduct statistical tasks and exchange information on examination practices under common rules and parameters, building on work of the Trilateral statistical working group Common approach to sharing & documenting search strategies (PTO): Promote re-utilization by enabling patent examiners of each office to understand each other's search strategy Common search & examination support tools (PTO): Establish system of common search and examination tools to facilitate work-sharing

26 PPH Statistics PPH PartnerTypeStart DateEnd dateRequests Received (4/1/09) JPOpilot7/3/061/3/08274 JPOFull1/4/08520 UKIPOpilot9/4/079/4/08 (extended until further notice) 50 KIPO (Korea)pilot1/28/081/28/09125 CIPO (Canada)pilot1/28/081/28/096 IPAU (Australia)pilot4/14/084/14/094 EPOpilot9/29/089/29/094 DKPTO (Denmark)pilot11/3/0811/3/090 IPOS (Singapore)pilot2/2/092/2/100

27 Peer Review Pilot n For members of the public to submit prior art with commentary, using Internet peer review techniques, in volunteered published applications to a public website ( –143 applications volunteered –TC 2100 and 3600 Business Methods technology only –10 pieces of prior art max per application (avg. was 4) n 56 applications have received at least a first action on the merits –7 received a rejection using peer found prior art –10 others received a rejection using art found by both the examiner and the peers –39 art found by examiner n Pilot extended 1 year to include Business Methods – Class 705 –Encourage more participation –Technology heavy with Non-patent literature n Over 22,000 letters from the USPTO were mailed out in applications that may be eligible for the pilot, 52 consent forms were filed as a direct result of this mailing

28 Accelerated Examination  Change in practice effective August 25,  Opportunity for final determination in 12 months.  Participation requires: Applicants provide greater information up front – pre-examination search and accelerated examination support document File application using electronic fling system Agree to interviews Limited number of claims

29 Accelerated Examination Current Statistics  As of May 2009: 914 applications allowed oOn average, 197 days to complete prosecution oMinimum number of days to complete prosecution: 18  69.7% Allowance Rate for FY08  80.3% Allowance Rate for FY09 (as of May 09)  Participants’ response & comments positive Not only faster, but high quality

30 Accelerated Examination Current Statistics

31 First Action Interview Pilot  Applicant requests to participate, 493 applicants had joined the pilot  Application is NOT taken out of turn  “Preliminary office action” is prepared and mailed to applicant – condensed version of typical first action on the merits  After interview applicant receives copy of action or allowance with entry of proposed amendment  Piloted in two workgroups of TC 2100

32 FAI Statistics as of May 4, Applicants have joined the pilot program 370 Pre-interview Communications (PFA OA) have been mailed 263 Interviews have been conducted 226 First Action Interview Office Actions have been mailed 84 Allowances –44 allowed after pre-interview communication but before FAI office action –15 allowed after the FAI office action –25 allowed without/before pre-interview communication

33 FAI Expansion –POPA Exec Committee agrees to selection of proposed areas for expansion. »These areas are – 1610, 1795, 2160 (in original pilot), 2440&50 (in original pilot), 2617, 2811+, 3670 and –Pilot process changes –PALM tracking changes –EFS and EDAN changes –Applicant survey

34 Electronic Filing New EFS-Web system launched March 2006:  Allows PDF-based submissions  Replaced XML-based system 2005 result: 2.2% of applications filed electronically result: 71.6% of applications filed electronically Goal: 80%  As of Dec 14, 2008, 147,640,728 pages have been filed using EFS