MAJOR CHANGES IN PTO FEES EFFECTIVE JANUARY 19, 2025

The United States Patent and Trademark Office (USPTO) has issued a final rule setting out patent fee increases that will come into effect on January 19, 2025.

The USPTO states that costs justify an increase of 10% for up-front fees and 7.5% for other fees except where special circumstances apply and larger increases are justified. The larger increase on up-front fees is justified as bringing the fee closer to the actual cost of examining applications. However, the current 60% and 80% fee reductions for small and micro entities respectively will apply to all fees being changed by the final rule.  Situations where “special circumstances” apply and fee increases larger than those noted above are justified include the following:

• Second and subsequent RCEs: an increase from $2,000 – $2,860 (proposals for a further increase for the third and subsequent RCE’s were not adopted)
• Increase of per claim fee for each claim over 20 from $100 – $200
• Increase of fee for each independent claim over 3 from $480 – $600
• New fee for continuing applications (i.e continuations and divisional applications) filed more than 6 years after first non-provisional ancestor (referred to as “the effective benefit date”): $2,700
• New fee for continuing applications filed more than 9 years after its effective filing date: $4,000

New fees for IDSs where cumulative number of references cited in a given application (irrespective of the actual number of IDSs filed) is:

• 51 – 100 = $200;
• 101 – 200 = $500;
• More than 200 = $800

Furthermore, when submitting an IDS, amended 37 CFR 1.98(a) requires that when filing an IDS, the applicant must include a statement that either no fee is required because a total of fewer than 50 references have been cited or a statement that the required information disclosure fee is being paid:

• Design Patent Application filing fee increase from: $1,020 – $1,300;
• Design issue fee increase from: $740 – $1,300;
• Fee for requesting inter partes review increase from: $19,000 – $23,750;
• Post-institution continuation fee for IPR increase from: $22,500 – $28,125;

Similar % increases apply to post grant reviews.

• A new fee of $452 is introduced for requesting Director Review of decisions by the Patent Trial and Appeal Board.
• Fee for revival of abandoned application filed more than two years after abandonment increase from: $2,100 – $3,000

After Final Consideration Pilot 2.0 (AFCP) program was terminated as a result of public reaction to a proposal to charge for it. The proposal for different fees for terminal disclaimers depending on when the petition for a terminal disclaimer was filed was not implemented.

The PTO gives the following explanations of the “special circumstances” that apply to these fees:

Filing Fees on Continuing Applications:

The PTO justifies new fees on “late” continuing applications is  justified as a need to “top up” revenue from “ordinary” filings to cover the cost of examination and the fact that the total maintenance fee income on patents granted on such applications will be less than is raised on patents granted earlier in the 20 year patent term.

Design Patents:

The larger fee increases on design patent filing and issue fees is justified by balancing the effects of the large losses made by the PTO on handling design patent applications and the desire to keep up-front costs reasonably low.

Information Disclosure Statements:

The changes to fees on IDS’s are justified on cost grounds, the PTO noting:

In many instances, these large IDS submissions contain clearly irrelevant, marginally relevant, or cumulative information. It is onerous for examiners and hinders the USPTO’s statutory obligation to timely examine applications under 35 U.S.C. 154 to consider large numbers of clearly irrelevant, marginally relevant, or cumulative information. Additionally, large IDS submissions are costly for the agency to consider. Therefore, the USPTO suggests, as a best practice, that applicants and patent owners avoid filing large IDS submissions by eliminating clearly irrelevant, marginally relevant, or cumulative information. If applicants or patent owners file a large IDS, the USPTO encourages them to “highlight those documents which have been specifically brought to applicant’s attention and/or are known to be of most significance.”

It should also be recalled that case law has held that filing large numbers of references in an IDS in order to “bury” the most pertinent could in itself be held to be inequitable conduct that might make the patent unenforceable.

According to the Federal Register notice, the “count” will start again for each continuing application, but not for the filing of an RCE.

Requests for Continued Examination (RCEs)

On RCEs, the Federal Register notice states that in FY 2022, RCE filings comprised about 23% of all RCE and utility patent application filings collectively.

The PTO claims that current RCE fees are well below costs and justifies the new structure as follows:

The USPTO is increasing the § 1.17(e)(1) fee for a first RCE ($1,500 for undiscounted entities) only 10%, similar to the across-the-board adjustment applied to most patent fees. The undiscounted fee for a first RCE will thus remain more than 50% below cost. The USPTO is increasing the undiscounted § 1.17(e)(2) fee for the second and subsequent RCEs to an amount ($2,860) that is above the agency’s costs of processing those RCEs ($2,258 in FY 2023).  The final rule thus leaves the agency in essentially the same position financially as it has been since FY 2017, in that it will not recover its RCE processing costs from an applicant paying undiscounted RCE fees until the fourth or subsequent RCE filing and never recover its costs from applicants paying discounted RCE fees.

Fees for Revival of Unintentionally Abandoned Applications and Patents

The change in fee structure for revival of applications and patents abandoned for more than two years is justified on the grounds of the additional work involved in considering the evidence that is now required to be considered when a patent or application has been abandoned for more than two years.

When does Issue Fee Increase go into effect?

Under the changes to 35 U.S.C. 151 in the Patent Law Treaties Implementation Act (PLTIA) Public Law 112-211), the sum specified in the Notice of Allowance will constitute the issue fee and any required publication fee. The Office will proceed to issue a patent when the applicant pays the sum specified in the Notice of Allowance, regardless of the issue fee and/or publication fee in effect on the date the sum specified in the Notice of Allowance is paid.

Suggestions to Mitigate the Effects of the Fee Increases:

1. Where possible, for design patent applications and utility patent applications (Including U.S. national phase entries for PCT applications) with more than three independent claims or more than twenty claim in all, file before January 19, 2025.
2. Consider the desirability of continuation or divisional applications before six years have passed from the effective benefit date.
3. A theme of the increases seems to be to make it more expensive to have prolonged prosecution or to “burden” examiners with too many claims. An early understanding of the client’s objectives may help to deal with this, for example by filing more focused claims initially if the client is really only concerned with protecting a specific product. If the client has need for broader protection consider filing evidence with the response to the first action and/or interviewing the examiner early in the prosecution. If the examiner raises a restriction requirement or election of species requirement based on cited prior art, consider traversing the requirement by arguing, with a concomitant amendment of the claims if necessary or desirable, that there is a “special technical feature” that defines a contribution which each of the claimed inventions, considered as a whole, makes over the cited art. This would ideally get the examiner to address the argument in the first official action on the merits whereby the applicant could obtain an “extra” response in which novelty and obviousness of the claims are considered before a final action issues.
4. Consider filing more appeals. The government fee for a notice of appeal is currently $840 (increasing to $905 after January 19, 2025).  There is no government fee for requesting a pre-appeal brief conference.  Although a pre-appeal brief request most often results in a panel determining that an application remains under appeal because there is at least one actual issue for appeal, there are circumstances where it may be useful, including where an examiner has made an obvious error (such as citing a reference that was not published early enough to be prior art or relying for rejection on a rationale requiring findings that are clearly not supported by the cited references). Most “early” successes in appeals come after an applicant files an appeal brief which forces an examiner either to give up or write an examiner’s answer that will be scrutinized by other examiners before it is sent out.  There is no government fee for filing an appeal brief, although if this does not succeed in getting the examiner to give up, there is a transfer fee of $2360 (increasing to $2535 after January 19, 2025) to have the case transferred to the Patent Trial and Appeal Board.
5. Encourage applicants to focus their IDSs on relevant art. Since the Federal Circuit’s decision in Therasense, there have been few cases where a patent has been held to be unenforceable because of failure to cite art to the USPTO an attack to succeed, both the intent of the applicant not to file a reference and a finding that but for the omission of the reference from consideration by the examiner the patent would not have issued are required.