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Patent Preparation Costs: How Low Can You Go?

By Jeffrey R. Kuester and Dennis W. Jones
May 02, 2005

According to recent statistics, approximately 342,441 utility patent applications were filed in 2003 in the United States, and 169,028 utility patents were granted. These totals have nearly doubled over the past decade. Nonetheless, patent prosecution costs have seemed to trend lower or remain flat in recent years, even as courts are requiring more and more from application drafters. Does this prosecution revenue squeeze portend an increased economic risk for the patent practitioner? Does this pose more trouble for patent quality in general? Is a market glut of patent attorneys creating downward pressure on patent prosecution costs and resulting patent quality? Besides refusing to enter into a pricing war that is ultimately bad for our patent system, patent attorneys may wish to consider implementing changes to the patent system that help improve patent quality by reducing the recent flood of patent attorneys and agents entering the market.

Falling Costs vs. Increased Risk/Exposure

“You get what you pay for” has never been more apropos than in the current IP environment. As early as 1997, the Court of Appeals for the Federal Circuit recognized a premium on forethought in patent drafting. See Sage Products, Inc. v. Devon Industries, Inc., 126 F.3d 1420 (Fed. Cir. 1997). The Federal Circuit warned:

This court recognizes that such reasoning places a premium on forethought in patent drafting. Indeed this premium may lead to higher costs of patent prosecution. … Given a choice of imposing the higher costs of careful prosecution on patentees, or imposing the costs of foreclosed business activity on the public at large, this court believes the costs are properly imposed on the group best positioned to determine whether or not a particular invention warrants investment at a higher level, that is, the patentees. Id. at 1425.

While this forethought premium has translated into more stringent requirements regarding expertise and accountability, it has not translated into increased prosecution costs.

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