postheadericon How Important Is Docketing?

Extremely important.  Docketing is what keys our actions in IP prosecution.  Every patent or trademark application has due dates (usually many, many due dates) which if missed could result in the abandonment of an application.  Some missed dates are recoverable while some are not.  Of those that are recoverable, reinstatement can be quite expensive and require untold hours of additional work.

As of this writing, the published fee for reinstating a patent application under the unintentional abandonment standard is $1620; half that for a small entity.  But there are conditions that also must be met to reinstate the application.  So our objective is to prevent any matter from being unintentionally abandoned, thus rendering the need for reinstatement completely moot.  This means all of our filing must be done on time and someone has to keep track of all of the dates.  That someone is typically the Docket Clerk.

I’ve been in this business a fairly long time – over 26 years.  Tenure at different law firms and corporations has afforded me the privilege of getting to know a broad spectrum of people who docket, as well as how they can be perceived and treated.  Unfortunately, many perceive docketing as a simple data entry position.  This is a perception I have been trying to change for nearly two decades.

Data entry is just that: transcribing or entering data into specific form fields in a software application and saving it. Once saved the software app then does its thing with the entered information.  Verifying any underlying causes and effects is normally outside of the data entry person’s scope of responsibility.

Docketing is NOT like that, or at least it should not be like that.  For instance, once information is entered and the application calculates a response due date, the docketer should then verify that the auto-docketed date is accurate.  To do this requires that the docketer know how to compute due dates manually.

All too often I have seen a docketing program calculate response due dates incorrectly.  This is but one reason why I believe the docketer should be familiar with all of the ins and outs of each action and type of action that is, or could be, issued on a specific patent or trademark application.  After all … everything gets docketed.

Proper docketing in our discipline requires schedule management skills, huge attention to detail and a solid fundamental knowledge of IP prosecution with the know-how to look up rules when they are not clear.  Why?  Here is an example of what can happen if your docketer is not totally familiar with the rules and regulations of our world …

On Friday, December 15, 2000, at 5:18pm, the FDA approved a new drug owned by MDCO that is the subject of Patent No. 5,196,404. On Monday, February 14, 2001 – approximately 2 months after the approval date – an Application for Extension of Patent Term was filed with the PTO.

Under 35 U.S.C. 156, the term of some types of patents (e.g., pharmaceutical):

(c) “… shall be extended by the time equal to the regulatory review period for the approved product which period occurs after the date the patent is issued, …”

(d)(1) “To obtain an extension … the owner of record of the patent or its agent shall submit an application to the Director. … such an application may only be submitted within the sixty-day period beginning on the date the product received permission under the provision of law …”

So … since the FDA approval was issued on December 15, 2000, the Application for PTE needed to be filed by February 12, 2001.  Note the law states that the 60 day period begins on the date of approval, which means that December 15 is day 1.  Since both December and January have 31 days, 60 days would be February 12, 2001.

In this case the Application for PTE was filed on February 14, 2001, missing the due date by 2 days.  The question is why was the date missed?   Based on available information one could make a fair assumption that whoever docketed it probably entered the approval date of December 15, 2000 correctly. But the due date for the Application for PTE was either spaced off or somehow computed for 2 months rather than 60 days.

Focusing on due date calculation as the issue, this was likely the result of:
1- insufficient rules knowledge by the docketer, or
2- the docketer had rules knowledge but didn’t go out and check it.

Regardless of whether or not there was a software computation error – nobody QA’d the work!

If you take a look at the Application for PTE in PAIR, the last paragraph on the first page was marked out. Said paragraph includes language that the application “is being submitted within the 60 day period…”.  This markup would typically indicate that (a) whoever prepared the application did not submit it within the 60 day period, and (b) whoever signed the application was probably aware that it was being filed late.

One might also surmise that the signatory may not have recognized the mistake until after the due date was past.  Since nothing could have been done at that point, it’s possible they simply crossed out that date, filed it and hoped for the best.

Now for the big question – what is the bottom line ramification of this 2-day delay in filing the Application for PTE?   According to file history documents, without the approved Patent Term Extension, the patent would have expired on March 23, 2010.  With the approved PTE, the patent wouldn’t expire until December 15, 2014. By filing the Application for PTE late, the patent did indeed expire on March 23, 2010.

With the patent having expired, generic brands of the product would have been allowed to hit the market as of March 23, 2010 as opposed to December 15, 2014.  (There have been provisional term extensions granted for this patent by the way.)

We all know how averse insurance companies are to paying for a brand name drug when a generic version is available.  So on March 23, 2010, the insurance companies would have most certainly switched prescribers to approved generic versions en mass. In this scenario MDCO would lose revenue (and market share) to their generic equivalent manufacturers between March 23, 2010 and December 15, 2014.

Exclusive-rights name brand prescription drug sales can be huge.  How huge?  My understanding is that the malpractice insurance company for the law firm who made this error agreed to pay MDCO $18 million up front, with an additional $214 million contingent upon the Application for PTE not being approved.  So obviously MDCO believes their product would have made at least $214 million between March 23, 2010 and December 15, 2014. I think that qualifies as pretty huge.

All is not lost for MDCO though.  They are working with someone in Congress to amend the law to include the following language:

For purposes of determining the date on which a product receives permission under the second sentence of this paragraph, if such permission is transmitted after 4:30 P.M., Eastern Time, on a business day, or is transmitted on a day that is not a business day, the product shall be deemed to receive permission on the next business day. For purposes of the preceding sentence, the term “business day” means any Monday, Tuesday, Wednesday, Thursday or Friday, excluding any legal holiday under section 6103 of title 5.

MDCO is trying to get this tacked onto a patent law that is currently in Congress.  Whether or not they succeed will be interesting to find out.  I’m certainly curious.

Should the above amendment pass into law, I think that MDCO is hoping to make its effective date retroactive.  If so, then their Application for PTE would be accepted as having been timely filed, and MDCO would be able to sell its product exclusively through December 15, 2014.

Now, what if the amendment passes and generic versions were found to have appeared on the market after March 23, 2010? Could MDCO sue for infringement?  This is a true legal advice question whose answer resides outside of my ethical purview as a non-lawyer professional to provide. As a personal observation, drug manufacturers who might have released their generic equivalents between March 23, 2010 and the date MDCO’s amendment went into law could have a defense that their actions were legal under the law at the time their products were on the market.   I don’t do patent litigation anymore, but this case surely would be an interesting one on which to work.

You can also bet that MDCO’s frustration grows every single day this gets delayed.

The subject matter surrounding this blog barely scratches the tip of an enormous iceberg. Thousands upon thousands of pages in additional documentation … tens to hundreds of thousands of dollars in additional legal fees … all because of a single docketing error. My intent here is not to review a case, but rather to illustrate then drive home this very important point:

A docket clerk, whose position is inherently capable of making mega-$million mistakes that require full-blown acts of Congress to fix, is responsible for considerably more than mere data entry.

Possessing acute docketing system/software knowledge is not enough. I believe this to be a perfect example of how important correct and informed docketing is – and why IP prosecution docketing personnel should be fundamentally trained in all of our field’s laws & procedures.

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