In recognition that one-size-fits-all examination timing may not be ideal for every applicant, earlier this year the U.S. Patent and Trademark Office proposed a three-track system to allow applicants greater control over patent application processing. The three-track initiative would provide an option for fee-based prioritized examination (Track I), and an applicant-controlled examination delay of up to 30 months option (Track III), in addition to traditional examination (Track II).

Since David Kappos became the new PTO director a year ago, he has tried to focus on a perennial complaint about PTO backlogs being unacceptably long. Patent applicants long have complained that the typical experience of waiting several years for a first substantive response from a patent examiner, and then several more years to get the application allowed, eliminated much of the benefit of patenting their inventions. Thus, it is not surprising that initially most of the attention for the three-track proposal was focused on Track I, which would provide a fast track for prosecution aimed at reducing time to first office action to four months (currently at 26 months) and overall application pendencies to 12 months (currently at 36-45 months).

U.S. patent applicants traditionally have had just a few less-than-attractive options for speeding up examination. Applicants have been able to petition to make a case “special” in order to qualify for expedited processing, but there are a number of strings attached that make this approach unattractive even for the limited number of applicants who qualify. More recently, Kappos successfully implemented two additional alternatives. “Project Exchange” allows applicants to sacrifice one application (i.e., expressly abandon it) in order to win the right for another to get fast track processing. This exchange can be made between co-owned applications, or those with at least one inventor in common. The theory is that this process would remove a less-wanted application from the processing queue while advancing another through the queue more quickly. In addition, last year a fast track procedure for select “green” patent applications was implemented, to advance those applications out of turn to help encourage U.S. cleantech development. Track I of the three-track proposal can be seen as a larger effort in the same direction.

Implementing such fast track changes is not easy. With static or reduced operating funding, speeding up the processing of some applications is bound to slow down the processing of others unless significant new efficiencies can be realized. Aware of that issue, Director Kappos took note of the old adage, “If you can’t fix it, feature it,” and proposed that certain applications could be intentionally delayed. Under Track III, applicants could opt to delay regular processing of the application for an additional two and a half years. As an additional benefit, the trigger for putting the application in the normal queue is payment of the PTO’s examination fee, so the applicant gets to delay that payment as well. This aspect of the proposal is notable in that it is entirely in the applicants’ discretion when, during the 30-month period, they wish to pay the examination fee to move their applications into either the normal processing queue or the fast track. Thus, a company can move from a low-cost holding pattern during its self-funded startup phase to a fast track after it completes its first round of outside financing.

The proposal didn’t get much response initially–the PTO’s solicitation for written comments prior to the July 20, 2010 public hearing on the topic drew less than a dozen responses. But even those few comments provided a wide range of views. Andrea Doering wrote that rewarding those who could afford the opportunity to jump ahead of others “seems to come very close to bribery, if you ask me.” Others applauded the fast track. One comment suggested that any third party, by paying the appropriate fee to move out of the slow track (to either the normal track or the fast track) would allow third parties with sufficient interest to resolve that uncertainty more quickly. S. Cangialosi argued that deferred examination should be a preferred track, and that “the 30 month delay period should be renewable subject to an appropriate fee up to the time limit of the patent term.”

Public response sharply increased after the hearing, with a total of 52 written comments provided on the PTO website within a month’s time, primarily by businesses and intellectual property associations. Most commentators praised Track I, raising only implementation questions such as whether it would be available to all applications or only new filings, whether a small entity discount and/or sliding scale fee structure would apply, and whether refunds would be issued if pendency targets were not achieved (in view of PTO targets not being reliable for other fast track options). In contrast, Track III was the subject of much concern. Most controversial was the exclusion of applications first-filed internationally, and an accompanying fear of retaliation by foreign patent offices or undermining of the Patent Cooperation Treaty (PCT), followed by a concern over the lack of public notice for such a prolonged period without the safeguard of a search report like that issued during the similar PCT delay. A few concerns were raised about the proposal generally, such as what effect it would have on regular examination (Track II) pendency, and whether the increased fees received would actually be used within the PTO (i.e., because Congress maintains a longstanding practice of diverting PTO-generated fees for other purposes).

The PTO was fairly clear in its original notice that its proposal was just a starting point, and therefore solicited comments and held hearings to flesh out implementation parameters such as those as raised in the written comments. Recently, during his “First Anniversary Review” with media representatives and on his public blog, Director Kappos noted that many public comments about the proposal had been received, and that the PTO is taking them into consideration as it refines the proposal for implementation, which is expected to proceed in the coming year. While there are many details to be worked out, the PTO is to be commended for considering novel solutions to the backlog issues that have hounded it for so long.