Recent Fee Increases from the U.S. Patent and Trademark Office
It may seem like the increase in IPR and PGR fees charged by the USPTO is a bit harsh.
On January 16, the U.S. Patent and Trademark Office (USPTO) raised a number of fees that are estimated to increase annual revenue by about $400 million. For utility patents, the combined filing, search and examination fees increased from $1,600 to $1,720 for large entities. For every independent claim over three, the fee increased from $420 to $460; for each claim greater than 20, the fee increased from $80 to $100. The Issue fee also increased from $960 to $1,000.
The fee for a first Request for Continued Examination (RCE) increased from $1,200 to $1,300; for each subsequent RCE, the fee increased from $1,700 to $1,900. The Appeal Forwarding fee increased from $2,000 to $2,240. For National Stage entry into the U.S., the filing fee increased from $1,480 to $1,580. These fee increases are relatively modest, especially considering that the USPTO has not raised fees in over four years.
USPTO fees that were more dramatically increased involve proceedings to challenge issued patents before the USPTO’s Patent Trial and Appeal Board (PTAB). The fee for an Inter Parties Review (IPR) increased 33% from $23,000 to $30,500, while the fee for a Post Grant Review (PGR) went up 27% from $30,000 to $38,000.
The modest increases involved in filing and obtaining utility patents are acceptable considering that the cost of securing a U.S. patent remains a bargain based on the potential to commercially exploit inventions in the U.S. The higher fee increase for proceedings to challenge patents in the PTAB reflects an increase in competiveness in intellectual property (IP) rights and the USPTO’s success in offering alternatives to lengthy and expensive challenges in federal courts.
According to 2015 statistics provided by the World Intellectual Property Organization (WIPO), a total of 28,883,700 patent applications were filed worldwide, with 589,410 applications filed in the USPTO. The USPTO reports that the five largest intellectual property offices in the world are: the European Patent Office (EPO), the Japanese Patent Office (JPO), the Korean Intellectual Property Office (KIPO), the State Intellectual Property Office of the People’s Republic of China (SIPO), and the USPTO. Based on the number of patent applications filed, the ranked order of these offices (from most to fewer) is SIPO, EPO, USPTO, JP and KIPO.
Of the countries represented by these offices, the U.S. has the combination of the highest percentage of full-time employed workers and the highest median household income. In addition, the U.S. has a population that is greater than Japan and South Korea and rivals that of the EPO member countries. These economic factors make IP rights, including issued patents, comparatively more valuable in the U.S and attract many foreign companies to the U.S. market. The ranked order of countries that file the most U.S. patent applications (from most to fewer) is Japan, South Korea, Germany, China, UK, Canada and France.
Competitors are increasingly challenging U.S. patents before the PTAB. From September 16, 2012, when the USPTO initiated IPR and PGR procedures, to October 31, 2017, 7,074 IPR and 82 PGR petitions were filed. In October 2017 alone, 119 IPR and four PGR petitions were filed. Both IPRs and PGRs can be efficient alternatives to litigating in federal courts. IPRs and PGRs have a set timeline of 12 months from institution to completion. One source estimates that IPR proceedings are approximately 10 times less expensive and one-and-a-half times faster than litigating validity in district court.1
The patent fees charged by the USPTO go toward creating and obtaining government-granted, time-limited monopolies in which to commercially exploit inventions while excluding competitors. Successful companies seek and secure these rights, and competitors seem to be increasingly challenging them.
It may seem like the increase in IPR and PGR fees charged by the USPTO is a bit harsh. However, one has to consider that these procedures offer considerable time and cost savings compared to litigation proceedings in federal courts.
1. Kwok, B. and Martini, N., “Post Grant Review is Becoming Increasingly Popular,” Law360, June 1, 2016.
Any views or opinions expressed in this column are those of the author and do not represent those of Ceramic Industry, its staff, Editorial Advisory Board or BNP Media.