The comment period for the USPTO’s proposed patent quality initiatives is open until May 6, 2015, and the Office of Inspector General for the Commerce Department has given stakeholders plenty to think about in its final report on the USPTO’s quality assurance program. The OIG identified four areas of concern and made four recommendations for addressing its findings. Will stakeholders come forward with additional ideas for addressing these problems?

The OIG’s Final Report

The OIG’s final report highlights  four areas of concern:

1. The USPTO’s performance appraisal plan and related policies are ineffective at measuring whether examiners are issuing high-quality patents.

• Even though the USPTO admits to patent quality problems, 95% of examiners receive the highest performance ratings (“outstanding” or “commendable”).

• If a supervisor charges an error against an examiner, the examiner can initiate a grievance process, so many supervisors choose instead to coach the examiner.

• Examiners can receive the highest performance ratings even if errors are found in 75% or 100% of their work that is reviewed, as long as they are meeting the USPTO’s production goals. (A performance appraisal is based on an in-depth review at least 4 of an examiner’s written decisions.)

2. The USPTO’s official quality metrics may underrepresent the true error rate.

• The Office of Patent Quality Assurance (OPQA) reviews less than 1% of all office actions annually.

• OPQA typically does not charge errors in applying new examination guidance for 6 to 12 months after guidance was issued.

3. The USPTO is not collecting data that could improve patent quality.

• The USPTO only recently started requiring supervisors to record errors identified in their review of examiner work product for performance appraisals.

• The USPTO does not record errors uncovered during the Signatory Authority Review program that assesses whether an examiner is qualified to issue office actions without supervisory review.

• On the other hand, the USPTO expends significant resources measuring examiner productivity.

• Over the past 5 years, in any given quarter, up to 20% of examiners submitted more than 50% of their work product during the last 4 weeks of the quarter.

4. The USPTO’s response to patent mortgaging may not discourage abuse.

• According to the report, patent mortgaging is the practice of knowingly submitting incomplete work for credit.

• According to the report, patent mortgaging occurs because some examiners can receive credit for their work before it is reviewed.

• According to the report, patent mortgaging does not directly impact applicants because the incomplete work is caught by administrative staff and returned to the examiner.

The OIG’s Recommendations

The OIG’s final report sets forth recommendations under each area of concern.

1. Refine supervisory guidance, processes, and performance appraisal plans to effectively measure patent examiner quality efforts and distinguish levels of performance—including taking steps to avoid disincentives for supervisors to charge errors to examiners when assessing performance under the requirements set forth in the examiner performance appraisal plans.

2. Strengthen OPQA’s (a) independent quality review procedures to ensure their consistent application, particularly with respect to the application of new case law and how errors are categorized, and (b) internal audit process, by minimizing the predictable nature of the audit steps and allowing for the identification of the informal practices followed by some OPQA reviewers.

3. Use available databases and systems to collect information on patent applications reviewed and errors found, to improve USPTO’s ability to identify quality trends.

4. Develop and document additional controls to better detect and monitor the practice of patent mortgaging and continue to ensure consistent application of USPTO disciplinary policies that address instances of it.

The USPTO’s Response

According to the report, the USPTO has been receptive to the OIG’s recommendations. The USPTO has created a new, full-time senior executive position, the Deputy Commissioner for Patent Quality (currently filled by Valencia Martin-Wallace), has announced an Enhanced Patent Quality Initiative and has requested public comments on enhancing patent quality.

The USPTO issued the following (excerpted) comments in response to the OIG’s specific recommendations:

1. “[T]he USPTO … will consider options for providing training and guidance to supervisors on how best to administer the quality element [of performance appraisal plans].”

2. (a) “OPQA will formally document when grace periods apply following the issuance of new patent examination guidance.”
   (b) “The USPTO has … utilized an external firm to train twenty new internal auditors and provide refresher training to existing auditors.”

3. “The USPTO will utilize available databases and systems to collect information on patent applications reviewed and errors found to improve the ability to identify quality trends.”

4. The USPTO has implemented “the consistent credit initiative (CCI) program” which is “focused on encouraging and teaching examiners on the importance of producing work product on a consistent basis … throughout the year.”

Your Recommendations

While the OIG report reveals problems in the USPTO’s systems, it is important to remember that many examiners take pride in their work, issue high quality written decisions, and interact with applicants in a positive, professional manner. The task before the USPTO is to ensure that these examiners are rewarded while those responsible for the scathing headlines are coached, disciplined, or terminated.