Signon letter filed -- PTO's CLE rules -- and what comes next

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David Boundy

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Mar 29, 2021, 8:52:59 AM3/29/21

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Dear Patent colleagues --

1. The comment letter on CLE is filed, a final copy is at https://drive.google.com/file/d/1w3sK1IsZ6pWlJYi0texZUWMnsLHkRpK7/view It will eventually show up at https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=202102-0651-003 Thank you to all who commented, and all who signed. It is a MUCH better letter for your help (both substantive and for tone).

2. Your chance to comment. If you are so inclined, the comment period on CLE runs at least through today (Sunday), and quite probably through Monday (I don't know whether OMB's computers know about a weekend-and-holiday rule). To submit your comment, the blue box is at https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202102-0651-003 If I can suggest a comment, it might go like this -- obviously the more you rewrite it to make it yours, the better.

I am one of the co-signatories on the "85 Patent Practitioners" letter of March 28.

I write separately to urge OIRA to admonish PTO that procedural law matters. Procedural rules exist to ensure that decision-makers ask the right questions of the right people to fully inform themselves of all relevant facts, before making decisions. Procedural rules exist to prevent unintended consequences.

The PTO is well aware of the importance of procedural rules—the procedural rules for patent applications applications fill over 300 pages of the Code of Federal Regulations, and hundreds of pages more of guidance documents. The PTO enforces those rules tenaciously. 98% of the enforcement is fine, because when the PTO follows rulemaking procedure, its rules reflect fair cost-benefit balancing and sound policy choices, and the public has fair notice beforehand.

The letter explains a recent pattern of rulemaking in which the PTO has shortcut required procedure. That shortcutting deprives OIRA of critical information, deprives the public of critical opportunity to comment, and deprives the PTO of critical information about cost-benefit balancing. The letter is at least as much about informing you of that pattern and its costs, and asking you to help get PTO on side with the law, than about this particular instance.

The key message in the "85 Patent Practitioners" letter is that procedural rules matter just as much to the PTO's rulemaking decisions as they do its patent decisons. The pattern of shortcutting in the PTO’s rulemaking leads to PTO issue rules that impose costs that have no public policy grounding, and that create burden and cost-shifts without commensurate benefit.

I urge OIRA to grant only a narrow clearance as requested in the "85 Patent Practitioners" letter. PTO should have an opportunity to rethink some of its recent rules that don't serve their needs well, and retailor recent rules to do a more-targeted job at lower cost.

3. Progress report: the PTO career staff are trying to jam though about seven of these things during this period when there's no political appointee. DOCX, several for trademark, assignment recording, CLE, etc. Each of these triennial renewals is a two-step process -- 60 days of notice-and-comment at the agency, then the agency is supposed to summarize the letters, answer the comments, start implementing suggestions, etc. and THEN send a request for approval over to OMB so OMB can run phase two, a 30-day comment period.

The first two were patent applications, and patent prosecution up to notice of allowance -- the two that concern DOCX. The phase one comment period ended at midnight, Nov 30. The PTO sent them over to OMB at 5PM on Nov 30 (seven hours before the comment period ended), obviously without even reading the comment letters. Hmm. So for phase two, I wrote a letter as just me. Obviously I had a lot of errors to point out, since PTO didn't even pretend to try. https://papers.ssrn.com/abstract=3800439 . Normally OMB approves these things in a few days. This one has been sitting for three months.

The third one is trademark "where you sleep at night." In phase one, there were nine comment letters. Again, after phase one, the PTO spent three days thinking, and made a really silly filing at OMB. For phase two, we (the Oppedahl trademark list) filed our letter at OMB yesterday, at https://drive.google.com/file/d/1YBxHA2mOAOgz2ON4EvzHYeV5kMTk-hQp/view?usp=sharing_eil or https://papers.ssrn.com/abstract=3814326

This CLE rule is the fourth one -- the phase one comment period closed Feb 23, and the PTO filed its phase two request at OMB on Feb 26. In three days, the PTO gave no apparent thought to the comment letters, and filed a brush-off submission to OMB. The PTO seems to have dug itself deeper into... Today's letter is the phase two letter https://drive.google.com/file/d/1w3sK1IsZ6pWlJYi0texZUWMnsLHkRpK7/view , and it points out several plain contradictions to OMB. The hard part of this letter is maintaining lawyerly neutrality in the face of the PTO's shortcutting of multiple requred steps, often by the artifice of false statement to falsely claim an exemption from legal requirements (I am so grateful to those of you that helped).

The last one sequentially is about assignment recordations. We sent in our phase-one letter on March 12, https://papers.ssrn.com/abstract=3803689 Hmm, two weeks later, it looks like the PTO is getting serious -- it's been two weeks, and PTO hasn't yet made its filing at OMB to start phase two.

I can't promise what will happen. All I can report is that (a) PTO is now giving two weeks' thought, where they used to give negative seven hours, and (b) things that OMB normally approves in days have now taken three months. I think it's the cumulative effect of the letters. I think OMB is likely starting to smell the same rats we do -- PTO doesn't make little errors of omission here and there, it's a concerted effort fueled by errors of commission (including outright falsification), designed to evade work and jam though very high-burden rules in th e interregnum while there's no Director to serve as a check.

This CLE rule is the one where the PTO made the clearest record of intentional badness. It's hard to attribute malice to silence that is adequately explained by stupidity. But affirmative statements that are false, and that the PTO digs itself into after falsity is pointed out... Ironic, since it originates with the PTO's ethics office.

Thank you all! I am really grateful for your help and support.

David

On Tue, Mar 23, 2021 at 1:53 PM David Boundy <DavidBo...@gmail.com> wrote:

Dear Patent Colleagues --

The PTO’s proposal to require CLE—and to require that most of that required CLE must be courses taught by the PTO, with only minimal cross-recognition of state CLE—is up for notice and comment at OMB. (The Paperwork Reduction Act requires agencies to re-review and re-notice-and-comment all rules that call for paperwork every three years, and part of that process is a notice-and-comment round that goes to OMB, bypassing the PTO.) Please sign on, and please pass this email to colleagues at your firm, to your friends, to other lists of patent lawyers. Please comment by 9PM eastern on Friday.

This letter takes no position on whether CLE is a good idea or bad idea. The only topic is the PTO’s failure to observe the procedures of the Administrative Procedure Act, the Paperwork Reduction Act, and Executive Order 12866.   Each of these laws requires agencies to engage with the public early in the rulemaking process to vet out potential rules, to estimate cost, to fairly respond to public comments, and do genuine cost-benefit balancing. The PTO skipped all the required steps (and then states that they did them—when OMB’s web site shows that PTO plainly didn’t). Like any other procedural rules, rulemaking procedure exists to ensure sound decision making—rulemaking procedure should have guided the PTO to consult with the public, so that we jointly could have designed CLE rules of lower cost and more tailored to whatever problem the PTO perceives. As currently configured, the current consensus estimate is that the PTO's proposal creates costs on the patent bar of $ 130-150 million per year. The letter takes no position on whether that’s good or whether that's bad, only that the PTO didn’t ask the right questions at the right time.

   1. A near-final draft is at https://drive.google.com/file/d/1w3sK1IsZ6pWlJYi0texZUWMnsLHkRpK7/view?ts=605a20da

   2. Please sign at https://docs.google.com/spreadsheets/d/1O2HBpjdV60M4q3IJaY8AemHjCD1jAhOIkpQDb4ZensA/edit?ts=605a208b .

       3. Please circulate this email! Signatures of individuals get the job done.   Organizational signatures would add heft.

       If you want to write your own comment letter: The request for comment Federal Register notice is here https://www.federalregister.gov/documents/2021/02/26/2021-04045/agency-information-collection-activities-submission-to-the-office-of-management-and-budget-omb-for and the real document we're commenting on is here https://www.reginfo.gov/public/do/DownloadDocument?objectID=109594900 To submit your comment, the blue box is at https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202102-0651-003 (the PTO's notice gives you a wild goose chase instead of a URL—the PTO’s docs are completely opaque; other agencies don't go as far out of their way to make informed public comment as impossible as the PTO does).

Thank you.

David