The USPTO’s Spring 2006 Business Methods Partnership Meeting

The US Patent & Trademark Office held on May 3, 2006 the latest in a series of meetings begun following the Office’s March 2000 Business Methods Patents Initiative. Among the more notable comments from USPTO officials were the following.

Patentable Subject Matter

While the USPTO is awaiting the Supreme Court’s anticipated decision later this year in Laboratory Corporation v. Metabolite Laboratories, and its recently promulgated interim examination guidelines are still the subject of public comments, Examiners have been instructed to follow the interim guidelines when determining whether applications present subject matter eligible for patent protection under 35 U.S.C. § 101. The Office believes that its interim guidelines are consistent with Supreme Court, Federal Circuit, and USPTO precedent, including Ex parte Lundgren, a recent 3-2 decision of the Board of Patent Appeals and Interferences. Lundgren held that it is improper to reject as nonpatentable subject matter claims to a business method — on the ground that the claimed invention is outside the “technological arts” — even when nothing in the application describes implementing the method in a computer or other machine.

Although Lundgren held that there is no technological-arts test for patentable subject matter, the majority opinion expressed no view on an alternative ground for a rejection of Lundgren’s application — suggested in the dissenting opinions — as directed to a “process” that was outside the meaning of that term as used in the patent laws. Some commentators have speculated that Examiners might use this alternative ground as a basis for rejecting certain business-method applications, but at least one USPTO official stated that there was no indication that any such departure from the Interim Guidelines would be used by Examiners to support a rejection.

Application Allowance Rates and Pendency

For an application in Class 705, the application allowance rate for FY2005 and at mid-year FY2006 is 19%. This compares to previous years as follows:

FY2001    45%
FY2002    26%
FY2003    16%
FY2004    11%
FY2005    19%
FY2006 at mid year    19%

The USPTO views the increased allowances from 11% in 2004 to the current 19% as attributable to applications having narrower claims, and to a reduction in the backlog for examining applications.

Speaking of backlog, for a Class 705 application the average time from the filing date to a first Office action is about four and a half years. The USPTO expects to publish an advance notice of proposed rulemaking regarding accelerated examination (for all applications) around the end of May 2006.

Examination Quality

Examiners handling applications in Class 705 can access an internal USPTO Web page for non-patent literature (NPL) specific to business methods. This NPL Web page includes:

The USPTO has also developed a text-search-strategy tool and a database of specific prior-art patents concerning business methods. Using the search tool an Examiner can, for example, input the term “financial instruments” and receive as output “stocks,” “bonds,” and “futures.” The search tool includes over 3,000 business and computer terms and can be updated by direct Examiner input. The patents database is a collection, documented for reference, of what the USPTO considers to be foundational, overview, ground-breaking, and state-of-the-art patents pertinent to examining applications in Class 705. The USPTO describes the text-search-strategy tool and patents database as part of its continuing efforts to ensure that Examiners have access to as much relevant prior art as possible.