Intellectual Property: Comparison of Patent Examination Statistics for
Fiscal Years 1994 and 1995 (Letter Report, 03/13/97, GAO/RCED-97-58).

Pursuant to a congressional request, GAO compared the Department of
Commerce's Patent and Trademark Office's patent pendency statistics for
fiscal years 1994 and 1995, focusing on: (1) overall pendency; (2)
patent pendency by examination groups, secrecy orders, foreign
applications, and current and original application dates; and (3) patent
pendency attributable to applicants.

GAO noted that: (1) patent pendency declined slightly in fiscal year
(FY) 1995 in comparison with FY 1994; (2) overall average pendency in FY
1995 was 19.8 months, or 0.4 month less than the 20.2-month average for
FY 1994; (3) similarly, pendency declined somewhat for 8 of the 17
examination groups and for foreign applications; (4) pendency remained
about the same when the original rather than the current application
filing date was used for the calculation; (5) pendency for applications
subject to secrecy orders increased, but these were so few in number
that they had virtually no effect on overall pendency; and (6) GAO also
found that the average amount of pendency attributable to the applicant
increased from 7.4 months in FY 1994 to 8 months in FY 1995.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-97-58
     TITLE:  Intellectual Property: Comparison of Patent Examination 
             Statistics for Fiscal Years 1994 and 1995
      DATE:  03/13/97
   SUBJECT:  Patents
             Copyrights
             Statistical data
             Intellectual property

             
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Cover
================================================================ COVER


Report to the Chairman, Committee on the Judiciary, U.S.  Senate

March 1997

INTELLECTUAL PROPERTY - COMPARISON
OF PATENT EXAMINATION STATISTICS
FOR FISCAL YEARS 1994 AND 1995

GAO/RCED-97-58

Intellectual Property

(141020)


Abbreviations
=============================================================== ABBREV

  GAO - General Accounting Office
  PALM - Patent Application Location and Monitoring (system)
  PTO - Patent and Trademark Office

Letter
=============================================================== LETTER


B-276028

March 13, 1997

The Honorable Orrin G.  Hatch
Chairman, Committee on the Judiciary
United States Senate

Dear Mr.  Chairman: 

Our July 15, 1996, report provided you with statistics on "patent
pendency," or the amount of time the U.S.  Department of Commerce's
Patent and Trademark Office (PTO) takes to examine a patent
application.\1 We also discussed the statistics on patent pendency in
a statement for the record that we provided for a hearing on
intellectual property that you held on September 18, 1996.\2 The
statistics in the report and statement for the record relied on
fiscal year 1994 data from PTO's automated database; these data were
the most recent and complete fiscal year data available at the time
of our review. 

At your request, we currently are conducting a review on intellectual
property fees.  In carrying out this work, we again queried PTO's
automated database to obtain data for both fees and pendency, this
time analyzing information for fiscal year 1995.  Following
discussions with your office, you requested that we update the
statistics in our July 1996 report to compare pendency for fiscal
years 1994 and 1995.  Detailed information on this comparison is
provided in appendix I.  Similar to our July 1996 report, this report
provides you with information on overall pendency; patent pendency by
examination groups, secrecy orders,\3 foreign applications, and
current and original application dates; and patent pendency
attributable to applicants.  More details on our scope and
methodology are included in appendix II. 


--------------------
\1 Intellectual Property:  Enhancements Needed in Computing and
Reporting Patent Examination Statistics (GAO/RCED-96-190). 

\2 Intellectual Property:  Patent Examination and Copyright Office
Issues (GAO/T-RCED/GGD-96-230). 

\3 Patent applications for inventions that could affect national
security interests can be placed under a secrecy order by PTO if the
applicable federal agency determines that such protection is
necessary. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

Patent pendency declined slightly in fiscal year 1995 in comparison
with fiscal year 1994.  Overall average pendency in fiscal year 1995
was 19.8 months, or 0.4 month less than the 20.2-month average for
fiscal year 1994.  Similarly, pendency declined somewhat for 8 of the
17 examination groups and for foreign applications.  Pendency
remained about the same when the original rather than the current
application filing date was used for the calculation.  Pendency for
applications subject to secrecy orders increased, but these
applications were so few in number that they had virtually no effect
on overall pendency.  We also found that the average amount of
pendency attributable to the applicant increased from 7.4 months in
fiscal year 1994 to 8 months in fiscal year 1995. 


   BACKGROUND
------------------------------------------------------------ Letter :2

A patent is a grant, given by a government to an inventor, of the
right to exclude others for a limited time from making, using, or
selling his or her invention.  In the United States, the sole
granting authority for patents is PTO. 

Within PTO, the patent application examination process consists of
several progressive phases.  First, an applicant files a patent
application with PTO, where it is subjected to reviews for accuracy
and completeness during a preexamination phase.  Following
preexamination, the application is assigned, or "docketed," to an
examiner within an examination group that has expertise in a specific
field, such as computer systems or biotechnology. 

At this point, the examiner begins the process of determining whether
the invention is a new and useful process or product that should
receive a patent.  Usually, early in the process, the examiner makes
a preliminary decision, or "first action," which may then be followed
by a series of contacts with the applicant to resolve questions
and/or obtain additional information.  Possibly after a number of
actions by the examiner, PTO will decide whether to issue a patent. 
If PTO decides to issue a patent, termed an "allowance," then the
agency informs the applicant and, upon the payment of the necessary
fees, issues the patent.  The application may be abandoned during any
of these stages.\4

PTO defines patent pendency as the period from the date when an
application is filed until the date when a patent is issued or the
application is abandoned.  Pendency as reported by PTO excludes
applications that have been filed but not yet issued or abandoned. 
PTO computes average pendency as the total number of months for all
patents issued or abandoned over a particular period, divided by the
total number of applications for that period. 

As discussed in our earlier report, patent pendency has taken on an
increased importance because of 1994 legislation affecting the term
of most patents.  Public Law 103-465 changed the patent term for most
new applications from 17 years from the date of the patent's issuance
to 20 years from the filing of the original application on the
invention.\5 Any time spent by PTO in examining a patent application
subject to the new law reduces the effective patent term left to the
inventor. 


--------------------
\4 As used by PTO, an "abandoned" application is any application that
does not result in an issued patent and is eventually taken out of
the examination process by the applicant or by PTO. 

\5 Under P.L.  103-465, the term of a design (configuration, shape,
or surface ornamentation) patent--14 years from the date of
issuance--remains unchanged.  Utility (process, machine, manufacture,
or composition of matter) and plant (asexually propagated) patents
had a term of 17 years from the date of issuance under the old law
and 20 years from the date of the earliest filing under the new law. 
Reissued patents (replacement of defective patents) are for the
unexpired part of the term of the original patents. 


   MINOR CHANGES IN PENDENCY
   OCCURRED IN FISCAL YEAR 1995
------------------------------------------------------------ Letter :3

In comparing patent pendency in fiscal year 1995 with that
experienced in fiscal year 1994, we found minor variations from what
was reported in our July 1996 report.  We analyzed changes in total
pendency, pendency by examination groups, pendency for patents under
secrecy orders, pendency for foreign applications, pendency using
current and original application filing dates, and the applicants'
impact on pendency. 


      TOTAL PENDENCY
---------------------------------------------------------- Letter :3.1

As shown in table I.1, overall patent pendency was 19.8 months in
fiscal year 1995--a decrease of 0.4 month, or 2 percent, from the
20.2-month average pendency in fiscal year 1994.  This decrease was
evident in the average pendency for both issued patents, which
decreased from 21.3 to 21 months, and abandoned applications, which
decreased from 18.3 to 17.9 months. 

The total number of patents issued and applications abandoned
decreased slightly from fiscal year 1994 through fiscal 1995,
dropping from 187,633 to 186,195, or about 0.8 percent.  The primary
reason for this decrease was a decline in abandoned applications,
which fell 3.2 percent, from 73,949 to 71,553.  The number of patents
issued increased by 0.8 percent, from 113,684 to 114,642. 


      PENDENCY BY EXAMINATION
      GROUPS
---------------------------------------------------------- Letter :3.2

As shown in tables I.2, I.3, and I.4, pendency continued to vary
widely among the individual examination groups in fiscal year 1995. 
The highest pendency again was for computer systems, where it was
26.2 months in total, 27.6 months for issued patents, and 24.4 months
for abandoned applications.  The lowest pendency continued to be for
solar, heat, power, and fluid engineering devices, where the average
was 17.4 months in total, 18.4 months for issued patents, and 14.6
months for abandoned applications. 

Among the 17 examination groups for which we calculated statistics, 9
groups had an increase in overall average pendency, and 8 groups had
a decrease.  In most cases, the variations in pendency from fiscal
year 1994 through fiscal 1995 were small; only three groups had a
change of more than a month in overall pendency.  The largest change
was for special designs, where overall pendency decreased by 3.6
months in total, 3.3 months for issued patents, and 4.6 months for
abandoned applications. 


      PENDENCY FOR PATENTS UNDER
      SECRECY ORDERS
---------------------------------------------------------- Letter :3.3

As shown in table I.5, fewer patents were issued or applications
abandoned in fiscal year 1995 for those applications that had been
subject to secrecy orders at one time.  Overall, the number declined
from 464 in fiscal year 1994 to 396 in fiscal year 1995--a decrease
of 14.7 percent. 

Pendency for applications subject to secrecy orders increased
significantly from fiscal year 1994 through fiscal 1995.  Average
pendency for applications subject to secrecy orders at one time
increased from 62.9 months to 75.3 months overall, or an increase of
12.4 months per application.  The average increase varied from 8.0
months for issued patents to 23.2 months for abandoned applications. 

As in fiscal year 1994, the high level of pendency for applications
subject to secrecy orders had no significant effect on overall
pendency, since these cases accounted for only 0.2 percent of the
total patents issued and applications abandoned in fiscal year 1995. 
In fact, those applications not subject to secrecy orders had an
overall pendency of 19.7 months compared with an overall pendency of
19.8 months for all applications. 


      PENDENCY FOR FOREIGN
      APPLICATIONS
---------------------------------------------------------- Letter :3.4

As shown in table I.6, the average pendency for foreign patent
applications decreased in fiscal year 1995.\6 The overall pendency
for foreign applications was 20.6 months in fiscal year 1995 compared
with 20.9 months in fiscal year 1994--a decrease of 0.3 month. 
Pendency on domestic applications decreased an average of 0.4 month,
from 19.7 months in fiscal year 1994 to 19.3 months in fiscal 1995. 


--------------------
\6 PTO considers a patent application to have originated in a foreign
country if the first applicant named in the application is a foreign
resident. 


      PENDENCY USING CURRENT AND
      ORIGINAL APPLICATION FILING
      DATES
---------------------------------------------------------- Letter :3.5

According to PTO officials, a patent application may spawn other
applications during the examination period.  Several generations of
applications are possible from one invention.  The new, or current,
application is referred to by PTO as the "child," and the earlier
application is referred to as the "parent." In our July 1996 report,
we reported that pendency would be greater if PTO were to use the
filing date of the original, or parent, application to compute
pendency rather than the filing date of the current, or child,
application.  As shown in table I.7, in fiscal year 1995,
applications with a parent continued to constitute a significant
portion--30.2 percent--of the patents issued and applications
abandoned. 

Using the original filing date for the patents issued and
applications abandoned in fiscal year 1995 that actually had a
parent, the overall pendency would have been 47.2 months compared
with 17.8 months using the current filing date.  This difference was
about the same as it was in fiscal year 1994, when pendency on
applications with a parent would have been 47.7 months using the
original filing date and 17.9 months using the current filing date. 

When the original filing date is used, the impact on pendency for all
applications in fiscal year 1995--rather than just those with a
parent--showed slight differences compared with the impact in fiscal
1994.  Had the original application date been used for all
calculations, the overall pendency for fiscal year 1995 would have
been 28.7 months rather than 19.8 months.  In comparison, the use of
the original filing date uniformly in fiscal year 1994 would have
resulted in an overall pendency of 28 months rather than 20.2. 


      APPLICANTS' IMPACT ON
      PENDENCY
---------------------------------------------------------- Letter :3.6

In our July 1996 report, we noted that the applicants themselves can
be responsible for a portion of the pendency.  We included statistics
on one element--the amount of time spent by applicants in responding
to PTO office actions during examination.  In commenting on our 1996
report, PTO agreed that applicants often are responsible for
pendency's being higher and that there were numerous other reasons
for higher pendency beside the responses to PTO's queries.  PTO
provided us with its own analysis of overall delays caused by
applicants.  We referred to these in our 1996 report but did not
include the details of PTO's analysis. 

In preparing our updated statistics, we asked PTO to provide us with
an updated analysis of applicant-caused delays using fiscal year 1995
data.  The results of PTO's analysis are shown in table I.8. 
Consistent with our July 1996 report, we have presented the data as
provided to us by PTO rather than conducting our own analysis from
the fiscal year 1995 database.  Although we did not verify the
accuracy of PTO's computations, in the one area where we could
compare results--applicants' response time to PTO office actions--our
statistics were within 0.05 month of PTO's statistics.  This one area
accounted for nearly one-half of the overall pendency attributable to
applicants. 

PTO identified seven areas where applicants create delays.  In total,
these areas accounted for 8 months of the 19.8 months in overall
pendency during fiscal year 1995.  In comparison, 7.4 months were
attributable to applicants' delays in the 20.2 months of overall
pendency during fiscal year 1994.  In both years, the single largest
contributor to delays was the applicant's response time to PTO office
actions, which was 3.7 months in fiscal year 1995 compared with 3.6
months in fiscal 1994. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :4

We transmitted a draft of this report to the Department of Commerce
for its review and comment.  Generally, the Department agreed with
the information in the draft report.  The only area where the
Department recommended changes related to table I.7, which compared
pendency using current and original application dates.  The
Department said that its own data showed no significant differences
between the statistics for fiscal years 1994 and 1995, while our
statistics showed a decrease in pendency for fiscal 1995. 

In follow-up discussions with PTO, we found that the data that PTO
had provided us with--and from which we had made our calculations--on
original application filing dates were incomplete.  PTO later
provided us with the complete data, and we revised our calculations. 
These new calculations are shown in table I.7.  They indicate there
was no substantial difference in pendency for fiscal years 1994 and
1995. 

The Department raised two other points in its comments, neither of
which required any changes in the report.  The first point addressed
the pendency of applications subject to secrecy orders.  PTO noted
that it can take no final action until the classifying agency has
declassified the invention.  We agree and made this same point in our
earlier report on pendency that was issued in July 1996. 

The Department's second point was that its own pendency statistics
(1) do not include design patents and (2) actually report pendency
for the fiscal year on the basis of statistics at the end of the
fourth quarter.  As in our earlier report, we believe that our
statistics, which include design patents and calculate pendency for
all patents issued and applications abandoned during the fiscal year,
provide a better appraisal of patent pendency.  The full text of the
Department's written comments appears in appendix III. 


---------------------------------------------------------- Letter :4.1

We will send copies of this report to the appropriate House and
Senate committees; interested Members of Congress; the Secretary of
Commerce; the Assistant Secretary of Commerce and Commissioner of
Patents and Trademarks; the Director, Office of Management and
Budget; and other interested parties.  We will make copies available
to others on request.  If you or your staff have any questions or
need additional information, please call me at (202) 512-3841.  Major
contributors to this report are listed in appendix IV. 

Sincerely yours,

Allen Li
Associate Director, Energy, Resources,
 and Science Issues


STATISTICS ON PATENT PENDENCY,
FISCAL YEARS 1994 AND 1995
=========================================================== Appendix I



                               Table I.1
                
                   Comparison of Patent Pendency for
                Patents Issued or Applications Abandoned
                   During Fiscal Years 1994 and 1995

                                                 Average pendency in
                        Number of applications          months
                        ----------------------  ----------------------
Applications              1994    1995  Change    1994    1995  Change
----------------------  ------  ------  ------  ------  ------  ------
Issued                  113,68  114,64     958    21.3    21.0     -.3
                             4       2
Abandoned               73,949  71,553       -    18.3    17.9     -.4
                                         2,396
======================================================================
Total                   187,63  186,19       -    20.2    19.8     -.4
                             3       5   1,438
----------------------------------------------------------------------
Source:  Patent Application Location and Monitoring system, Patent
and Trademark Office (PTO); GAO's computations. 



                                        Table I.2
                         
                             Comparison of Patent Pendency by
                         Examination Group for Patents Issued or
                           Applications Abandoned During Fiscal
                                   Years 1994 and 1995

                                  Number of applications      Average pendency in months
                               ----------------------------  ----------------------------
Group      Description             1994      1995    Change      1994      1995    Change
---------  ------------------  --------  --------  --------  --------  --------  --------
1100       General,              13,477    12,835      -642      19.7      19.2      -0.5
            metallurgical,
            inorganic,
            petroleum and
            electrical
            chemistry and
            engineering
1200       Organic chemistry      9,253     9,473       220      18.8      19.3       0.5
            drug, etc.
1300       Specialized            8,239     8,635       396      19.3      19.4       0.1
            chemical
            industries, etc.
1500       High polymer          15,550    14,079    -1,471      20.2      19.4      -0.8
            chemistry,
            plastics,
            coating,
            photography, etc.
1800       Biotechnology         13,094    12,605      -489      21.5      21.6       0.1
2100       Industrial            10,374    10,232      -142      20.5      20.9       0.4
            electronics,
            physics, etc.
2200       Special laws           4,220     5,429     1,209      24.7      24.4      -0.3
            administration
2300       Computer systems,      9,181     8,701      -480      27.6      26.2      -1.4
            etc.
2400       Packages,             10,507     8,006    -2,501      17.2      18.9       1.7
            cleaning,
            textiles, and
            geometrical
            instruments
2500       Electronic/           14,493    15,431       938      20.6      19.6      -1.0
            optical systems,
            etc.
2600       Communications,       13,371    13,463        92      22.7      22.1      -0.6
            measuring,
            testing and lamp/
            discharge group
2900       Special designs       17,036    16,134      -902      23.0      19.4      -3.6
3100       Handling and           8,501     9,121       620      17.8      17.5      -0.3
            transporting
            media
3200       Material shaping,      8,646     9,132       486      17.0      17.7       0.7
            tools, etc.
3300       Medical               12,056    12,186       130      18.2      18.4       0.2
            technology,
            sporting goods,
            etc.
3400       Solar, heat, power     8,424     9,401       977      16.9      17.4       0.5
            and fluid
            engineering
            devices
3500       Construction,          9,764    10,325       561      18.4      18.7       0.3
            petroleum and
            mining
            engineering
           Not determined         1,447     1,007      -440       N/A       N/A
=========================================================================================
Total                           187,633   186,195    -1,438      20.2      19.8      -0.4
-----------------------------------------------------------------------------------------
Source:  Patent Application Location and Monitoring system, PTO;
GAO's computations. 



                                        Table I.3
                         
                             Comparison of Patent Pendency by
                           Examination Group for Patents Issued
                            During Fiscal Years 1994 and 1995

                                  Number of applications      Average pendency in months
                               ----------------------------  ----------------------------
Group      Description             1994      1995    Change      1994      1995    Change
---------  ------------------  --------  --------  --------  --------  --------  --------
1100       General,               8,346     8,081      -265      20.7      20.3      -0.4
            metallurgical,
            inorganic,
            petroleum and
            electrical
            chemistry and
            engineering
1200       Organic chemistry      5,234     5,271        37      20.0      20.9       0.9
            drug, etc.
1300       Specialized            4,698     4,886       188      20.3      20.9       0.6
            chemical
            industries, etc.
1500       High polymer           8,360     7,647      -713      21.4      20.8      -0.6
            chemistry,
            plastics,
            coating,
            photography, etc.
1800       Biotechnology          4,209     4,207        -2      25.0      25.5       0.5
2100       Industrial             7,093     6,903      -190      21.4      21.8       0.4
            electronics,
            physics, etc.
2200       Special laws           2,964     3,714       750      25.8      25.4      -0.4
            administration
2300       Computer systems,      4,960     4,704      -256      29.0      27.6      -1.4
            etc.
2400       Packages,              6,364     5,299    -1,065      18.9      19.6       0.7
            cleaning,
            textiles, and
            geometrical
            instruments
2500       Electronic/            9,819    10,308       489      21.4      20.5      -0.9
            optical systems,
            etc.
2600       Communications,        7,932     7,697      -235      24.4      23.8      -0.6
            measuring,
            testing and lamp/
            discharge group
2900       Special designs       11,142    11,664       522      23.2      19.9      -3.3
3100       Handling and           5,940     6,281       341      19.0      18.7      -0.3
            transporting
            media
3200       Material shaping,      6,106     6,264       158      18.0      18.8       0.8
            tools, etc.
3300       Medical                7,273     7,632       359      19.9      20.1       0.2
            technology,
            sporting goods,
            etc.
3400       Solar, heat, power     6,447     6,887       440      17.8      18.4       0.6
            and fluid
            engineering
            devices
3500       Construction,          6,792     7,186       394      19.6      20.0       0.4
            petroleum and
            mining
            engineering
           Not determined             5        11         6       N/A       N/A
=========================================================================================
Total                           113,684   114,642       958      21.3      21.0      -0.3
-----------------------------------------------------------------------------------------
Source:  Patent Application Location and Monitoring system, PTO;
GAO's computations. 



                                        Table I.4
                         
                             Comparison of Patent Pendency by
                            Examination Group for Applications
                          Abandoned During Fiscal Years 1994 and
                                           1995

                                  Number of applications      Average pendency in months
                               ----------------------------  ----------------------------
Group      Description             1994      1995    Change      1994      1995    Change
---------  ------------------  --------  --------  --------  --------  --------  --------
1100       General,               5,131     4,754      -377      18.2      17.3      -0.9
            metallurgical,
            inorganic,
            petroleum and
            electrical
            chemistry and
            engineering
1200       Organic chemistry      4,019     4,202       183      17.2      17.3       0.1
            drug, etc.
1300       Specialized            3,541     3,749       208      18.0      17.5      -0.5
            chemical
            industries, etc.
1500       High polymer           7,190     6,432      -758      18.8      17.9      -0.9
            chemistry,
            plastics,
            coating,
            photography, etc.
1800       Biotechnology          8,885     8,398      -487      19.9      19.7      -0.2
2100       Industrial             3,281     3,329        48      18.6      19.1       0.5
            electronics,
            physics, etc.
2200       Special laws           1,256     1,715       459      22.3      22.3       0.0
            administration
2300       Computer systems,      4,221     3,997      -224      26.0      24.4      -1.6
            etc.
2400       Packages,              4,143     2,707    -1,436      14.7      17.5       2.8
            cleaning,
            textiles, and
            geometrical
            instruments
2500       Electronic/            4,674     5,123       449      18.9      17.8      -1.1
            optical systems,
            etc.
2600       Communications,        5,439     5,766       327      20.2      19.7      -0.5
            measuring,
            testing and lamp/
            discharge group
2900       Special designs        5,894     4,470    -1,424      22.5      17.9      -4.6
3100       Handling and           2,561     2,840       279      15.1      14.8      -0.3
            transporting
            media
3200       Material shaping,      2,540     2,868       328      14.6      15.4       0.8
            tools, etc.
3300       Medical                4,783     4,554      -229      15.6      15.6       0.0
            technology,
            sporting goods,
            etc.
3400       Solar, heat, power     1,977     2,514       537      14.1      14.6       0.5
            and fluid
            engineering
            devices
3500       Construction,          2,972     3,139       167      15.4      15.7       0.3
            petroleum and
            mining
            engineering
           Not determined         1,442       996      -446       N/A       N/A
Total                            73,949    71,553    -2,396      18.3      17.9      -0.4
-----------------------------------------------------------------------------------------
Source:  Patent Application Location and Monitoring system, PTO;
GAO's computations. 



                                        Table I.5
                         
                            Comparison of Patent Pendency for
                           Applications at One Time Subject to
                            Secrecy Orders--Patents Issued and
                           Applications Abandoned During Fiscal
                                   Years 1994 and 1995

                                 Number                    Average pendency in months
                   ----------------------------------  ----------------------------------
Applications             1994        1995      Change        1994        1995      Change
-----------------  ----------  ----------  ----------  ----------  ----------  ----------
Subject to
 secrecy orders
Issued                    330         289         -41        67.5        75.5         8.0
Abandoned                 134         107         -27        51.6        74.8        23.2
=========================================================================================
Total                     464         396         -68        62.9        75.3        12.4
Not subject to
 secrecy orders
Issued                113,354     114,353         999        21.2        20.9        -0.3
Abandoned              73,815      71,446      -2,369        18.3        17.8        -0.5
=========================================================================================
Total                 187,169     185,799      -1,370        20.1        19.7        -0.4
All
Issued                113,684     114,642         958        21.3        21.0        -0.3
Abandoned              73,949      71,553      -2,396        18.3        17.9        -0.4
=========================================================================================
Total                 187,633     186,195      -1,438        20.2        19.8        -0.4
-----------------------------------------------------------------------------------------
Source:  Patent Application Location and Monitoring system, PTO;
GAO's computations. 



                                        Table I.6
                         
                            Comparison of Patent Pendency for
                         Foreign Patents Issued and Applications
                          Abandoned During Fiscal Years 1994 and
                                           1995

                                Number                    Average pendency in months
                  ----------------------------------  ----------------------------------
Applications            1994        1995      Change        1994        1995      Change
----------------  ----------  ----------  ----------  ----------  ----------  ----------
Foreign
Issued                42,774      42,563        -211        21.9        21.5         -.4
Abandoned             26,188      24,620      -1,568        19.2        19.1         -.1
========================================================================================
Total                 68,962      67,183      -1,779        20.9        20.6         -.3
Domestic
Issued                70,910      72,079       1,169        21.0        20.7         -.3
Abandoned             47,761      46,933        -828        17.8        17.2         -.6
========================================================================================
Total                118,671     119,012         341        19.7        19.3         -.4
All
Issued               113,684     114,642         958        21.3        21.0         -.3
Abandoned             73,949      71,553      -2,396        18.3        17.9         -.4
========================================================================================
Total                187,633     186,195      -1,438        20.2        19.8         -.4
----------------------------------------------------------------------------------------
Source:  Patent Application Location and Monitoring system, PTO;
GAO's computations. 



                                        Table I.7
                         
                           Comparison of Patent Pendency Using
                         Current and Original Application Filing
                         Dates for Patents Issued or Applications
                          Abandoned During Fiscal Years 1994 and
                                           1995

                                                         Pendency in months
                                           ----------------------------------------------
                   Number of applications   Current filing date    Original filing date\a
                   ----------------------  ----------------------  ----------------------
Applications         1994    1995  Change    1994    1995  Change    1994    1995  Change
-----------------  ------  ------  ------  ------  ------  ------  ------  ------  ------
All applications
Issued             113,68  114,64     958    21.3    21.0    -0.3    28.0    28.5     0.5
                        4       2
Abandoned          73,949  71,553       -    18.3    17.9    -0.4    28.1    29.0     0.9
                                    2,396
=========================================================================================
Total              187,63  186,19       -    20.2    19.8    -0.4    28.0    28.7     0.7
                        3       5   1,438
Applications that
 had parent
 applications
Issued             27,526  31,683   4,157    19.4    19.2    -0.2    46.9    46.4    -0.5
Abandoned          22,160  24,518   2,358    16.1    15.9    -0.2    48.5    48.2    -0.3
=========================================================================================
Total              49,686  56,201   6,515    17.9    17.8    -0.1    47.7   \47.2    -0.5
-----------------------------------------------------------------------------------------
\a Original parent application filing date if application had a
parent; current application filing date if there was no parent. 

Source:  Patent Application Location and Monitoring system, PTO;
GAO's computations. 



                               Table I.8
                
                     Comparison of Patent Pendency
                 Attributable to Applicants for Patents
                Issued and Applications Abandoned During
                       Fiscal Years 1994 and 1995

                                               Pendency in months
                                          ----------------------------
Actions contributing to patent pendency       1994      1995    Change
----------------------------------------  --------  --------  --------
Actions attributable to applicants
Response to office actions\a                   3.6       3.7       0.1
Abandonment to revival\b                       0.1       0.1       0.0
Incomplete/informal to complete\b              0.6       0.8       0.2
Notice of allowance to payment of issue        1.6       1.6       0.0
 fee/drawing correction\b
Office action to notice of appeal\b            0.2       0.3       0.1
Notice of appeal to appeal brief\b             0.1       0.1       0.0
Office action to abandonment\b                 1.2       1.4       0.2
Subtotal                                       7.4       8.0       0.6
Other                                         12.8      11.8      -1.0
======================================================================
Total                                         20.2      19.8      -0.4
----------------------------------------------------------------------
\a These statistics were based on our analysis of PTO's patent
application database for fiscal years 1994 and 1995.  PTO performed
an independent analysis of responses to office actions for fiscal
year 1995 alone and calculated a delay of 3.61 months compared with
our calculation of 3.66 months--a difference of only 0.05 month. 

\b These statistics were provided directly by PTO.  We did not verify
their accuracy. 

Source:  Patent Application Location and Monitoring system, PTO;
GAO's computations. 


SCOPE AND METHODOLOGY
========================================================== Appendix II

To update the fiscal year 1994 patent pendency statistics in our
report entitled Intellectual Property:  Enhancements Needed in
Computing and Reporting Patent Examination Statistics
(GAO/RCED-96-190; July 15, 1996) and to compare them with fiscal year
1995 statistics, we relied on data reported through the Patent and
Trademark Office's (PTO) Patent Application Location and Monitoring
(PALM) system.  This system contains background information on each
patent application, as well as a "prosecution history" that shows the
date when key actions were taken on each application during
examination. 

To determine the fiscal year 1995 statistics, we used the same
methodology developed for the fiscal year 1994 pendency statistics
included in our July 1996 report.  Under this methodology, we first
analyzed the periodic reports that PTO produces from the PALM system. 
While these reports previously proved useful in learning how the
examination process works and what data were available from the
automated system, they did not allow us to compare pendency over a
full fiscal year for the individual categories of issued patents and
abandoned applications.  For this reason, we performed our own
analysis of the automated data.  We asked PTO to provide us with
certain background information and prosecution histories from the
PALM system for all patents issued and applications abandoned during
fiscal year 1995.  We designed our own automated program for
analyzing PTO's data.  In this regard, we obtained the file layouts
for one of PTO's own automated reports (PALM 3515) and held
discussions with PTO officials familiar with the PALM system to
ensure that we were using the same data fields to extract information
by examination phases, examination groups, types of applications,
secrecy orders, foreign applications, et cetera.  We then extracted
data and computed the number of applications, the average pendency,
and the pendency range for the various subsets of information shown
in the tables in appendix I of this report. 

Our analyses of pendency are based on PTO's own data.  We did not
independently verify or validate the PALM system or the data we
extracted from the system.  We did, however, discuss with officials
in PTO's Search and Information Resources Administration office the
layout of the PALM system, the manner by which information is added
to the system, and our plans for extracting, collating, and analyzing
the data we obtained from the system.  We also discussed the results
of our analysis of pendency with various PTO officials.  Where
possible, we compared aggregate data with data produced by PTO in
other reports and discussed with PTO officials the potential reasons
for any discrepancies. 

In commenting on our earlier report, PTO officials had provided us
with additional statistics on pendency caused by filers' delays. 
While we did not include these statistics in the pendency tables in
the earlier report, we did address them in our narrative on filers'
delays.  For this report, we asked PTO to provide us with similar
data for fiscal year 1995.  While we did not verify PTO's statistics,
we did compare the data in the one field--applicants' responses to
office actions--where we had made an independent analysis and found
that we differed by only 0.05 month. 

We conducted our review from December 1996 through February 1997 in
accordance with generally accepted government auditing standards. 




(See figure in printed edition.)Appendix III
COMMENTS FROM THE DEPARTMENT OF
COMMERCE
========================================================== Appendix II



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix IV

RESOURCES, COMMUNITY AND ECONOMIC
DEVELOPMENT DIVISION

Frankie Fulton
John P.  Hunt, Jr.
Mitchell Karpman
Paul Rhodes
Julie Schneiberg
Mindi Weisenbloom


*** End of document. ***