E6-10564. Size Standard for Purposes of United States Patent and Trademark Office Regulatory Flexibility Analysis for Patent-Related Regulations

AGENCY:

United States Patent and Trademark Office, Commerce.

ACTION:

Request for comments.

SUMMARY:

The United States Patent and Trademark Office (USPTO) uses the Small Business Administration (SBA) size standard for the purpose of paying reduced patent fees as its size standard when conducting an analysis or making a certification under the Regulatory Flexibility Act for patent-related regulations. The Small Business Administration Office of Advocacy (SBA-Advocacy) has questioned whether this is the appropriate size standard for conducting an analysis or making a certification under the Regulatory Flexibility Act. Pursuant to the Regulatory Flexibility Act, the USPTO is providing this opportunity for public comment on the establishment of the SBA's definition of “small business concern” for the purpose of paying reduced patent fees as the definition of “small business concern” for Regulatory Flexibility Act purposes for patent-related regulations.

Comment Deadline Date: To be ensured of consideration, written comments must be received on or before August 7, 2006. No public hearing will be held.

ADDRESSES:

Comments should be sent by electronic mail message over the Internet addressed to [e-mail]. Comments may also be submitted by mail addressed to: Mail Stop Comments—Patents, Commissioner for Patents, P.O. Box 1450, Alexandria, VA, 22313-1450, or by facsimile to [phone], marked to the attention of Christina T. Donnell. Although comments may be submitted by mail or facsimile, the Office prefers to receive comments via the Internet.

Comments may also be sent by electronic mail message over the Internet via the Federal eRulemaking Portal. See the Federal eRulemaking Portal Web site (http://www.regulations.gov) for additional instructions on providing comments via the Federal eRulemaking Portal.

The comments will be available for public inspection at the Office of the Commissioner for Patents, located in Madison East, Tenth Floor, 600 Dulany Street, Alexandria, Virginia, and will be available via the Office Internet Web site (address: http://www.uspto.gov). Because comments will be made available for public inspection, information that is not desired to be made public, such as an address or phone number, should not be included in the comments.

FOR FURTHER INFORMATION CONTACT:

Christina T. Donnell, Senior Petition Attorney, Office of Petitions, Office of the Deputy Commissioner for Patent Examination Policy, by telephone at [phone], by mail addressed to: Mail Stop Comments—Patents, Commissioner for Patents, P.O. Box 1450, Alexandria, VA, 22313-1450, or by facsimile to [phone], marked to the attention of Christina T. Donnell.

SUPPLEMENTARY INFORMATION:

The patent statute provides that “fees charged under [35 U.S.C. 41](a), (b) and (d)(1) shall be reduced by 50 percent with respect to their application to any small business concern as defined under section 3 of the Small Business Act, and to any independent inventor or nonprofit organization as defined in regulations issued by the Director.” 35 U.S.C. 41(h)(1). The SBA defines a small business concern for the purpose of paying reduced patent fees as one: “(a) Whose number of employees, including affiliates, does not exceed 500 persons; and (b) Which has not assigned, granted, conveyed, or licensed (and is under no obligation to do so) any rights in the invention to any person who made it and could not be classified as an independent inventor, or to any concern which would not qualify as a non-profit organization or a small business concern under this section.” 13 CFR 121.802.

The USPTO uses the SBA size standard for the purpose of paying reduced patent fees in 13 CFR 121.802 as the size standard when conducting an analysis or making a certification under the Regulatory Flexibility Act for patent-related regulations. See e.g., Changes To Support Implementation of the United States Patent and Trademark Office 21st Century Strategic Plan, 69 FR 56481, 56530 (Sept 21, 2004) (discussion indicating that small entities for purposes of Regulatory Flexibility Act are considered a subset of the small entities for purposes of paying reduced patent fees). The SBA-Advocacy, however, has questioned whether the USPTO's size standard is under-inclusive because it excludes “any business concern that has assigned, granted, conveyed, or licensed (and is under no obligation to do so) any rights in the invention to any person who made it and could not be classified as an independent inventor, or to any concern which would not qualify as a non-profit organization or a small business concern under [13 CFR 121.802].” 13 CFR 121.802(b).

The size standard set forth in 13 CFR 121.802 is the size standard “for the purpose of paying reduced patent fees” and thus appears to be limited to payment of patent fees. See 13 CFR 121.801. The SBA small business size standards are set forth in 13 CFR 121.201. The USPTO uses the SBA size standard for the purpose of paying reduced patent fees as its size standard when conducting an analysis or making a certification under the Regulatory Flexibility Act because the USPTO has no business need (other than to conduct an analysis or make a certification under the Regulatory Flexibility Act) to collect information from patentees and patent applicants concerning whether they are a small business concern using the size standards set forth in 13 CFR 121.201, and thus, the USPTO does not collect this information. The USPTO is proposing to use the size standard set forth in 13 CFR 121.802 as its size standard when conducting an analysis or making a certification under the Regulatory Flexibility Act to avoid the need to collect information from patentees and patent applicants concerning whether they are a small business concern using the size standards set forth in 13 CFR 121.201.

The Regulatory Flexibility Act permits an agency head to establish, for purposes of Regulatory Flexibility Act analysis and certification, one or more definitions of “small business concern” that are appropriate to the activities of the agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment. See 5 U.S.C. 601(3) and 13 CFR 121.903(c). Therefore, the USPTO is publishing for comment a definition of small business concern for purposes of the USPTO conducting an analysis or making a certification under the Regulatory Flexibility Act for patent-related regulations. Specifically, the USPTO's definition of small business concern for Regulatory Flexibility Act purposes is a business or other concern that: (1) Meets the SBA's definition of a “business concern or concern” set forth in 13 CFR 121.105; and (2) meets the size standards set forth in 13 CFR 121.802 for the purpose of paying reduced patent fees, namely an entity: (a) Whose number of employees, including affiliates, does not exceed 500 persons; and (b) which has not assigned, granted, conveyed, or licensed (and is under no obligation to do so) any rights in the invention to any person who made it and could not be classified as an independent inventor, or to any concern which would not qualify as a non-profit organization or a small business concern under this definition.

Dated: June 28, 2006.

Jon W. Dudas,

Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office.