On April 3, 2024, the United States Patent and Trademark Office (USPTO) issued a Notice entitled “Setting and Adjusting Patent Fees During Fiscal Year 2025.” ¹ In the Notice, “the USPTO proposes adjusting by approximately 5% all patent fees not covered by the targeted adjustments.” ² The Notice only proposes these increases and solicits written comments be submitted by June 3, 2024.

In the USPTO’s assessment, the new patent fee schedule will provide a significant overall benefit. ³ With an estimated implementation date of FY2025, more than four years after the fee adjustment, the USPTO asserts that “[a] 5% across-the-board increase in 2025 would be equivalent to just a 1.2% annual increase, well below the prevailing inflation rate the last few years.” ⁴

However, the targeted adjustments are likely to significantly increase the prosecution costs for all stakeholders, especially for entities that cannot rely on the 60 percent fee reduction for small entities or 80 percent fee reduction for micro-entities. An overview of important targeted adjustments follows, with all proposed fees shown at the large entity rate.

Targeted Increases Impacting Filing Strategies

The so-called targeted increases include many proposed fee increases that have the potential to impact filing strategies. For example, the USPTO proposes increasing the design filing fees from $1,020 to $1,300, an almost 30 percent increase in fees, with the grant fees going up by 76 percent. ⁵ For simple utility applications, the USPTO proposes increasing the fees for filing from $1,820 to $2,000, an almost 10 percent increase with a 5 percent increase in the non-DOCX surcharge. ⁶

For utility applications, there are significant proposed increases based on excess claim fees and for continuation applications. The excess claims fees for independent claims more than three are proposed to increase by 25 percent and fees for total claims in excess of 20 are increasing by 100 percent. ⁷

For the first time, the USPTO proposes surcharges for filing continuations or presenting priority claims based on the earliest priority date ⁸:

These surcharges are significant and exceed the typical filing fees. Since the USPTO’s fee schedule does not differentiate between continuation applications and divisional applications, the proposed fee increases are equally applicable to both.

While filing late priority claims can be avoided, the surcharge for continuation applications may not be. With over 68 percent of all applications not receiving a First Office Action on the merits within fourteen months of filing, ⁹ applicants, particularly in the national stage, may find it challenging to meet the 60-month window to avoid the surcharge. Since the First Office Action is commonly a restriction, it is likely that the cost for filing divisional applications will be impacted significantly.

Targeted Increases Impacting Prosecution Costs

The USPTO proposes several targeted increases likely to impact prosecution costs after filing. While proposing an up to 75 percent reduction for extension of time fees for provisional applications, for non-provisional applications, these fees are increasing about 5 percent. ¹⁰

The targeted fee increases have the potential to impact strategies for responding to Office Actions. On May 17, 2013, the USPTO introduced the After Final Consideration Pilot Program 2.0 (AFCP 2.0), granting examiners extra time to review responses to Final Office Actions provided independent claims are narrowed without requiring fees. By filing an AFCP 2.0 request, applicants can bypass requesting continued examination. In the Notice, the USPTO proposes a $500 fee for requesting an AFCP 2.0. ¹¹ Considering the proposed fees for an AFCP 2.0 request, applicants are likely to request continued examination instead. The fees for requesting continued examination are proposed to increase by 10 percent for the first request, 25 percent for the second request, and 80 percent for the third request. ¹²

The USPTO is also proposing a surcharge for filing Information Disclosure Statements (IDS) based on the total number of references ¹³:

Under 37 C.F.R. § 1.56, applicants have a duty to disclose all non-cumulative information material to patentability. If applicants intentionally omit references from an IDS to circumvent the cumulative surcharge and those references are deemed material, there is a risk that a charge of inequitable conduct may arise during litigation. As such, applicants may find themselves with no choice but to pay this fee.

The USPTO is proposing increasing the fees based on when a terminal disclaimer (TD) is filed during prosecution. These increases can be significant, as shown below. ¹⁴

Since TDs are typically not filed until there is allowable subject matter (i.e., after Non-Final or Final Office Action), the 194 percent or 371 percent increase will be applicable.

In addition, the USPTO is proposing increases for suspension of action ranging from 36 percent to 105 percent. ¹⁵ The petition fees are also proposed to increase between 5 percent to 43 percent depending on the petition. ¹⁶

Targeted Increases for Biotech and Pharma Patents

The USPTO also proposes targeted fee increases that are going to impact biotech and pharmaceutical patents the most. The USPTO proposes a 43 percent increase in the fees associated with filing a patent term adjustment (PTA) petition. ¹⁷ The proposed fee increases associated with patent term extension (PTE) are even larger with a 468 percent increase in the cost for applying for such an extension. ¹⁸ Given the significant upsides of PTA and PTE, these fee increases are not likely going to deter applicants from pursuing PTA and/or PTE.

Targeted Increases for AIA Trials  

The fees associated with requesting inter partes review or post-grant review are proposed to increase by 25 percent.  For the first time, the USPTO is proposing a fee ($440) for filing a request for review of a PTAB decision by the director. ²⁰ As AIA trials are typically filed as part of litigations, these proposed fees are likely not going to have much impact.

Actions that Applicants Can Take Now

If implemented, the targeted increases are going to impact large and small entity prosecution budgets alike. Applicants may want to consider the proposed rules when budgeting for 2025.

At this juncture, the fee increases are only proposed. While the Notice indicates that the input of the Patent Public Advisory Committee was considered, the public still can provide comments until June 3, 2024. Patent applicants dissatisfied with the USPTO’s proposed fees may wish to consider submitting public comments to persuade the USPTO to reconsider some of the proposed changes. Applicants could also lobby Congress to ensure that the fee increases are not finalized.

The proposed increases in claim fees and for filing continuation applications are particularly severe and may discourage the submission of divisional or continuation applications. These fee increases could potentially be considered substantive rules, in line with Tafas v. Dudas, 541 F. Supp. 2d 805 (E.D. Va. 2008), and thus could possibly be subject to a court challenge.

^{[1] 89 Fed. Reg. 23226 (April 3, 2024).
[2] Id. at 23235
[3] Id. at 23227 (Table 1)
[4] Id. at 23235
[5] Id. at 23239 (Table 6)
[6] Id.at 23253-254 (Table 18)
[7] Id. at 23241 (Table 7)
[8] Id. at 23237 (Table 5)
[9] USPTO’s PTA data https://www.uspto.gov/dashboard/patents/patent-term-adjustment-new.html (last accessed April 5, 2024).
[10] Id. at 23242 (Table 8), 23255 (Table 19)
[11] Id. at 23236 (Table 4)
[12] Id. at 23244 (Table 12)
[13] Id. at 23243 (Table 9)
[14] Id. at 23248 (Table 14)
[15] Id. at 23248 (Table 13)
[16] Id. at 23251 (Table 15)
[17] Id. at 23244 (Table 10)
[18] Id. at 23245 (Table 11)
[19] Id. at 23252 (Table 16)
[20] Id. at 23252 (Table 17)}

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.