Unleashing American Innovators Act Slashes USPTO Small Entity Fees

04 January 2023 PharmaPatents Blog
Author(s): Courtenay C. Brinckerhoff

If you get to page 1060 of the Consolidated Appropriations Act of 2023, you will see the Unleashing American Innovators Act of 2022, which was enacted on December 29, 2022. Part of that law changed the formula for calculating small and micro entity USPTO fee discounts. Effective immediately, small entities are entitled to a 60% discount (up from a 50% discount) and micro entities are entitled to an 80% discount (up from a 75% discount). The new fee schedule can be found here.

New Penalty For False Assertions of Small Entity Status

Perhaps concerned about the temptation to falsely assert small or micro entity status in order to enjoy these further reduced fees, the Unleashing American Innovators Act also includes a new penalty for false assertions.

Under current rules, “any attempt to fraudulently establish status as a small entity” is considered “as a fraud practiced or attempted on the Office,” which would jeopardize enforceability of the patent. However, if small (or micro) entity was “established in good faith” but later discovered to be “in error,” the error will be “excused” upon submission of a correction of entity status and payment of a fee deficiency for each fee paid at the erroneously claimed discounted rate.

Under the new law, “ an entity that is found to have falsely asserted entitlement to a fee reduction under this section shall be subject to a fine, to be determined by the Director, the amount of which shall be not less than 3 times the amount that the entity failed to pay as a result of the false assertion, whether the Director discovers the false assertion before or after the date on which a patent has been issued.” In view of the discretion delegated to the Director, I expect the USPTO to issue a proposed rule-making for implementation of this new penalty.

The MPEP reminds that there is a duty to investigate entitlement to claim small entity status, which must be verified before small entity status is first claimed (e.g., when paying discounted filing fees), again when the issue fee payment is made, and again when each maintenance fee payment is made.

This blog is made available by Foley & Lardner LLP (“Foley” or “the Firm”) for informational purposes only. It is not meant to convey the Firm’s legal position on behalf of any client, nor is it intended to convey specific legal advice. Any opinions expressed in this article do not necessarily reflect the views of Foley & Lardner LLP, its partners, or its clients. Accordingly, do not act upon this information without seeking counsel from a licensed attorney. This blog is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Communicating with Foley through this website by email, blog post, or otherwise, does not create an attorney-client relationship for any legal matter. Therefore, any communication or material you transmit to Foley through this blog, whether by email, blog post or any other manner, will not be treated as confidential or proprietary. The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate, and or up-to-date. Foley makes no representations or warranties of any kind, express or implied, as to the operation or content of the site. Foley expressly disclaims all other guarantees, warranties, conditions and representations of any kind, either express or implied, whether arising under any statute, law, commercial use or otherwise, including implied warranties of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Foley or any of its partners, officers, employees, agents or affiliates be liable, directly or indirectly, under any theory of law (contract, tort, negligence or otherwise), to you or anyone else, for any claims, losses or damages, direct, indirect special, incidental, punitive or consequential, resulting from or occasioned by the creation, use of or reliance on this site (including information and other content) or any third party websites or the information, resources or material accessed through any such websites. In some jurisdictions, the contents of this blog may be considered Attorney Advertising. If applicable, please note that prior results do not guarantee a similar outcome. Photographs are for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Related Services