TGIF for the New Ethics of Procedural Compliance at the USPTO

Thanks to Professor Dennis Crouch at Patently-O for posting USPTO Office of Enrollment and Discipline Director Harry Moatz's slide presentation entitled "Monitoring Practitioner Compliance With Disciplinary Rules and Inequitable Conduct" before the Intellectual Property Organization on September 11, 2007. According to Director Moatz, the USPTO is "monitoring compliance [for] conduct that can be perceived as failure to make reasonable inquiry, being interposed for improper purpose or delay, [and/or] incompetence or neglect." Here are a few of the other highlights from his slides:

• "Patent attorneys and agents are subject to discipline for not complying with adopted regulations."
• "Practitioners submitting papers must read each paper submitted to the Office before it is submitted. Each submitted paper must be read in its entirety."
• The duty to make a reasonable inquiry requires attorneys and agents to "Educate and arrange with clients to receive filing instructions and documents sufficiently in advance of a filing deadline."
• "Examples of conduct that may be perceived as failure to make reasonable inquiry:
  

  – A reference material to patentability is buried among a large number of
  cumulative references.
  • Buried reference anticipates one or more claims.
  • Reasonable inquiry has not been shown

  - Application filed with claims that are anticipated by at least one publication authored by one of the inventors executing the 37 CFR 1.63 declaration or oath.
  • Reasonable inquiry has not been shown."

• "Examples of situations potentially involving improper purpose or delay
  

  –Adding undue number of claims with multiple dependent claims.
  • Multiple dependency can add thousands of claims.
  • Each of must be examined for patentability.
  • May implicate violation of Disciplinary Rule 10.85(a)(1), to harass or injure another in reexamination situations."

• "Examples of situations potentially involving improper purpose or delay.
  

  –Filing an amendment, petition or other paper without required fee.
  • Insufficient funds.
  • Stop payment.
  • Lack of funds."

• "Duration of Duty To Disclose Under USPTO’s Ethics Rules
  - A first practitioner advises applicant that prior art is material to patentability of the claimed invention and must be disclosed to the USPTO.
  - The applicant refuses to follow this course of action and discharges the first practitioner.
  - The applicant engages a second practitioner without telling the second practitioner of the potentially damaging prior art.
  - Under § 10.85(b), the first practitioner would be required to disclose this situation to the Office.
  - See Practice Before the Patent and Trademark Office, Final Rule 50 FR 5158, 5165 (Feb 8, 1985)."

Professor Crouch calls these casual pronouncements "Ethical Duties to Comply with the New Rules" and Axel Horns at IPJUR adds that "It is a duty of the Office to refuse overbroad applications. It should, in my view, not be a duty of the applicant to refrain from applying for overbroad claims."

My own experience with a recent practitioner investigation left me with the impression that the USPTO's Office of Enrollment and Discipline is using thinly supported allegations of unscrupulous behavoir merely to urge better compliance with Office procedures that are not neccesarily consistent with an applicant's legal interests. Among the apparent deficiencies that I see in the current system are 1) a lack of published institutional guidelines and decisions for internally distingushing scandalous conduct from zealous representation; 2) a lack of institutional seperartion between those who raise, investigate, prosecute, judge, and punish practitioner misconduct; 3) a lack of published rules of procedure or evidence for investigations and prosecutions; and 4) an unwillingness to quickly and formally close investigations where there is insufficient evidence of misconduct to move forward. In fact, the general ethos of the Office seems to be one of "guilty until proven innocent" where accused practitioners, at the risk of losing their livelihood, are coerced into expounding upon their client's protected communications and work product simply because the Office disfavors an otherwise compliant patent prosecution strategy.

This apparent reversion to the the days of the "fraud squad" cries out for systematic reform. At a minimum, the Office must decide whether it is representing inventors, applicants, or itself in these challenges to practioners' professional responsibility and reputation. If it is to include the latter, and the Office is unable to effectively proscribe self-serving interdictions, then the entire disciplinary process must be transferred to a independent entity that is free to recoginize and balance the various competing interests at stake in the patent procurement process. As the managerial interests of the Office continue to diverge from those of its captive licensees, the state bar associations may now offer the only fora legitiums for assessing Official allegations against registered attorneys.

Thank Goodness It's Friday (and we're still registered to practice before the USPTO),

--Bill Heinze