Federal Register: Part II [37 CFR Parts 1, 2, 10 and 11]

DEPARTMENT OF COMMERCE

CFR Citation: 37 CFR Parts 1, 2, 10 and 11

Docket ID: [Docket No.: 2002-C-005]

RIN ID: RIN 0651-AB55

NOTICE: Part II

DOCUMENT ACTION: Notice of proposed rulemaking.

SUBJECT CATEGORY: Changes to Representation of Others Before the United States Patent and Trademark Office

DATES: To be ensured of consideration, written comments must be received on or before February 10, 2004.

DOCUMENT SUMMARY: The United States Patent and Trademark Office (Office or USPTO) proposes to update the procedures regarding enrollment and discipline. The Office also proposes to replace the current USPTO Code of Professional Responsibility, which is based on the Model Code of Professional Responsibility of the American Bar Association, with new USPTO Rules of Professional Conduct, largely based on the Model Rules of Professional Conduct of the American Bar Association.

SUMMARY: Commerce Department, Patent and Trademark Office,

SUPPLEMENTAL INFORMATION

At this time, nearly 28,000 individuals are registered as patent attorneys and agents, of whom about 80% have indicated that they are attorneys. The registered patent attorneys have offices located in all fifty States and the District of Columbia. More than 2,500 individuals applied for admission to the registration examination given on October 18, 2000. At the same time, the MartindaleHubbell reports that there are more than 900,000 lawyers and law firms listed in its legal directory. More than 17,000 attorneys are members of the Intellectual Property Law Committee of the American Bar Association. Any attorney who is a member in good standing of the bar of the highest court of a State or the District of Columbia is eligible to practice before the Office in trademark and other nonpatent matters. 5 U.S.C. 500(a). Fortytwo of the bars have adopted the Model Rules of Professional Conduct of the American Bar Association or a modification thereof, and two have disciplinary rules which are a combination of the Model Code and the Model Rules of Professional Conduct of the American Bar Association. Adopting ethics rules that are largely based on the Model Rules of Professional Conduct of the American Bar Association would provide attorneys, as well as registered patent agents, with consistent ethical standards, and large bodies of both case law and ethics opinions.

This notice of proposed rule making sets out rules in three areas: (1) Rules of general applicability, and rules governing the recognition of individuals to practice as attorneys and agents before the Office in patent, trademark, and other nonpatent matters (Sec. Sec. 11.111.18);
(2) Rules governing investigation and disciplinary proceedings for possible violations of the Office Rules of Professional Conduct (Sec. Sec. 11.1911.62). Disciplinary proceedings can result in reprimand, suspension or exclusion (disbarment) of individuals from practicing before the Office who, after notice and opportunity for a hearing, are found to have violated an imperative USPTO Rule of Professional Conduct; and
(3) Rules setting out the proposed Office Rules of Professional Conduct (Sec. Sec. 11.10011.806).

These changes are intended to improve the Office's processes for handling applications for registration, petitions, investigations, and disciplinary proceedings. The changes also are intended to bring standards of ethical practice before the Office into closer conformity with the Rules of Professional Conduct adopted by the majority of States, while addressing circumstances particular to practice before the Office. As these environments change (e.g., by adoption of amendments to the Model Rules of Professional Conduct of the American Bar Association) the Office will consider whether to make further changes to the rules.

This proposed rule making is being conducted under the auspices of the General Counsel of the United States Patent and Trademark Office, James Toupin (703) 3082000, and the supervision of the OED Director, Harry I. Moatz (703) 3059145). They would appreciate feedback on the overall rule making process in addition to any comments on the merits of the proposed rules.

Table 1 shows the principal sources of the proposed rules relating to (1) admission to practice of attorneys and agents in patent matters, and (2) practice in trademark and nonpatent matters.

Table 2 shows the principal sources of the rules proposed for disciplinary proceedings.

Table 3 shows the principal sources of the rules proposed for the Office Rules of Professional Conduct.

Discussion of Specific Rules:

Section 1.1 would be amended to add paragraph (4) to provide an address for correspondence for the Office of Enrollment and Discipline in enrollment, registration and investigation matters.

Section 1.4 would be amended to revise the references from Sec. Sec. 10.18(b)(2), 10.18(c), and 10.23(c)(15) to Sec. Sec. 11.18(b)(2), 11.18(c), and 11.804(c)(i)(15), respectively.

Section 1.21 would be amended to revise one paragraph into two distinct fees, add ten paragraphs to provide for ten new fees, as well as to reserve paragraph (3), redesignate another paragraph and change a section citation therein. These fees are intended to fund the costs of the registration examination process, disciplinary system, and maintain the roster of registered practitioners uptodate. Bar disciplinary activities are generally regarded as being in the interest of maintaining the Bar's reputation for integrity and supporting the willingness of potential clients to engage the services of practitioners. The continual
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updating of the USPTO roster is also in the interest of assuring that registered practitioners are identified to the public they seek to serve. The cost is currently met by funds from application, issue, or maintenance fees. By adopting these fees to be paid by registered practitioners, the costs of these activities are not passed on to applicants. Thus, USPTO will recover the costs associated with these activities from the practitioners instead of the public in general. The funds would be directed to these activities and would not be diverted to support other proposals. The fees are based on the status of the registered practitioner.

The USPTO is revising the way in which its registration examination is administered. Currently, the examination is administered twice a year, using a unique set of questions each time. The USPTO is moving to a frequently administered computerbased examination using a slate of questions randomly selected from a large data bank of questions and answers that will be publicly available. This change will make the testing process more efficient and will benefit applicants by permitting instant notification of test results, eliminating the current approximately six weeks needed to report the results of a paperbased examination. The computerbased examination will also facilitate more frequent administration and permit the test to be given simultaneously in many locations, thus reducing delays and travel expenses for applicants. Paragraph 1.21(a)(1)(ii)(B) would increase the examination fee to $450 for the test administered by the USPTO in order to recover the full costs of the examination process. Paragraph 1.21(a)(1)(ii)(A) would introduce a reduced examination fee of $200 for the test administered by a private sector entity. The $200 fee would cover the costs of establishing and maintaining an uptodate question and answer data bank to be used in the computerized delivery of the examination, but excludes the costs of actual test administration. This $200 fee will apply where administrative testing arrangements are made by a private sector entity. Applicants paying the $200 fee would schedule the test with the private sector entity, and pay a service fee, estimated to be $150, to the entity.

A registered practitioner in active status is one who is able to represent clients and conduct business before the USPTO in patent cases. To maintain active status, the practitioner would pay the annual fee required under Sec. Sec. 1.21(a)(7)(i) and 11.8(d) and comply with the continuing legal education (CLE) requirements under Sec. Sec. 11.12(a) and (e). With respect to the CLE requirement, an inactive or administratively suspended practitioner would have to contact the OED Director to be advised which CLE's to take.

A registered practitioner in inactive status would be prohibited from representing clients and continuing to practice before the Office in patent cases. Inactive status may be of an administrative nature where the status is inconsistent with the role of a practitioner, as in the cases of examiners working for the Office and judges. Inactive status also may be voluntary, as in the case of practitioners who have retired or are unable to continue their practice due to disability related matters but still desire to maintain a recognized professional association with the USPTO. Practitioners with a disability may become inactive.

A registered practitioner under administrative inactive status is not responsible for payment of the annual fee, or complying with the CLE requirements while in this status, but will have to complete the continuing education requirements for restoration to active status. A registered practitioner under voluntary inactive status is responsible for paying a reduced annual fee and completing the CLE requirements during the period of inactivation. For the purposes of this section, the fee for a registered practitioner in voluntary inactive status is 25% of the fee for a registered practitioner in active status. If a condition occurs that automatically terminates a practitioner's administrative inactive status, e.g., separation from the USPTO, it would be permissible for that practitioner to seek a voluntary inactive status where the practitioner does not intend to represent clients and practice before the Office, but still desires to maintain a professionally recognized association with the Office.

A registered practitioner who is administratively suspended is one who has failed to pay the annual fee required under Sec. 11.8(d) or to comply with the continuing legal education requirements under Sec. Sec. 11.12(a) and (e). Registered practitioners under active status can be administratively suspended under failure to comply with payment of the annual fee or failure to meet the CLE requirements. Registered practitioners under voluntary inactive status can only be administratively suspended for failure to comply with payment of the reduced annual fee.

Paragraph 1.21(a)(5)(i) would be added for a new fee for review of a decision by the OED Director. Paragraphs 1.21(a)(7) (i) and (ii) would be added for a new annual fee for registered patent attorneys and agents based on their active or inactive status. Paragraphs 1.21(a)(7) (iii) provides for a new fee due with a request from a practitioner seeking restoration to active status from inactive status. Paragraph 1.21(a)(7) (iv) would be added for payment of the balance due on the annual fee upon restoring active status to a registered practitioner in inactive status. Paragraph 1.21(a)(8) would be added for a new annual fee for individuals granted limited recognition. An individual granted limited recognition would not be eligible for voluntary inactive status. Paragraph 1.21(a)(9) would be added to set fees associated with the administrative suspension of a registered practitioner. Paragraph 1.21(a)(9)(i) would be added for a new fee for delinquency in payment of the annual fee or completing the required CLE requirements. Paragraph 1.21(a)(9)(ii) would be added for a new fee for reinstatement following administrative suspension. Paragraph 1.21(a)(5) has been redesignated (a)(5)(ii), and section citation of 10.2(c) would be changed to Sec. 11.2(d). Redesignated (a)(5)(ii), and section citation of 10.2(c) would be changed to Sec. 11.2(d). Paragraph 1.21(a)(10) would be added for a fee paid on application by a person for recognition or registration after disbarment, suspension, or resignation pending disciplinary proceedings in any other jurisdiction; on petition for reinstatement by a person excluded, suspended, or excluded on consent from practice before the Office; on application by a person for recognition or registration who is asserting
rehabilitation from prior conduct that resulted in an adverse decision in the Office regarding the person's moral character; and on application by a person for recognition or registration after being convicted of a felony or crime involving moral turpitude or breach of fiduciary duty. Paragraph 1.21(a)(11) would be added for a paper version of the continuing training program and furnished narrative. Paragraph 1.21(a)(12) would be added for Application by Sponsor for Preapproval of a Continuing Education Program.

Paragraph (a)(5) of Sec. 1.21 would be revised to add two paragraphs. Paragraph (i) would introduce a fee for review by the OED Director of a decision by a staff member of the Office of Enrollment and Discipline. Section
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1.21(a)(5) would be revised and redesignated (a)(5)(ii).

Paragraph (a)(6) of Sec. 1.21 would be eventually revised by deleting the fee for regrade and reserve the omitted paragraph.

Paragraph (a)(7) of Sec. 1.21 is proposed to be added to provide for a new annual fee paid by active and voluntary inactive registered patent attorneys and agents.

Paragraph (a)(8) of Sec. 1.21(a)(8) is proposed to be added to provide for a new annual fee paid by individuals granted limited recognition to practice before the Office.

Paragraph (a)(9) of Sec. 1.21 is proposed to be added to provide for new fees associated with delinquency resulting in administrative suspension of a registered practitioner, and reinstatement of the practitioner.

Paragraph (a)(12) of Sec. 1.21 is proposed to be added to provide for a fee to be paid by a sponsor upon submitting to the OED Director all information called for by the ``Application by Sponsor for Pre approval of a Continuing Education Program.''

Section 1.31 would be amended to revise the references from Sec. Sec. 10.6 and 10.9 to Sec. Sec. 11.6 and 11.9, respectively.

Section 1.33(c) would be amended to revise the references from Sec. Sec. 10.5 and 10.11 to Sec. Sec. 11.5 and 11.11, respectively.

Section 1.455 would be amended to revise the reference from Sec. 10.10 to Sec. 11.10.

Section 2.11 would be amended to revise the reference from Sec. 10.14 to Sec. 11.14.

Section 2.17(a) would be amended to revise the reference from Sec. Sec. 10.1 and 10.14 to Sec. Sec. 11.1 and 11.14, respectively.

Section 2.17(c) would be amended to revise the reference from Sec. 10.1 to Sec. 11.1.

Section 2.24 would be amended to revise the reference from Sec. 10.14 to Sec. 11.14.

Section 2.161(b)(3) would be amended to revise the reference from Sec. 10.1 to Sec. 11.1.

Section 11.1 would set out definitions of terms used in Part 11. The defined terms include: affidavit, application, attorney, belief, consent, consult, differing interests, employee of a tribunal, firm, fraud, full disclosure, giving information, hearing officer, knowingly, law clerk, legal counsel, legal profession, legal service, legal system, matter, OED Director, Office, partner, person, practitioner, proceeding before the Office, professional legal corporation, reasonable, reasonably should know, registration, respondent, secret, solicit, state, substantial, tribunal, and United States.

In the proposed rules, the word ``individual'' is used to mean a natural person, as opposed to a juristic entity. The definition of ``person'' is similar to the definition of ``person'' in 1 U.S.C. 1. ``Attorney'' is defined in the same manner as the term is used in 5 U.S.C. 500(b). The proposed definition includes an attorney who is a member of one bar in good standing, and ``under an order of any court or Federal agency suspending, enjoining, restraining, disbarring or otherwise restricting'' the attorney from practice before the bar of another state or Federal agency. The broad definition is believed necessary inasmuch as 5 U.S.C. 500(b) provides that ``an individual who is a member in good standing of the bar of the highest court of a State may represent a person before an agency * * *.'' Though an attorney suspended in one state and a member in good standing in another state could represent a person before the Office, nevertheless the grounds for suspension in one state may give rise to grounds for suspending the attorney from practice before the Office, 5 U.S.C. 500(d)(2), after notice and opportunity for a hearing. See Selling v. Radford, 243 U.S. 46 (1917).

The phrase ``full disclosure'' is used to define the explanation a practitioner must give a client regarding potential and actual conflicts of interest. The explanation is based on discussions of full disclosure found in Opinion No. 1997148, Standing Committee on Professional Responsibility and Conduct (California), and in In re James, 452 A.2d 163 (D.C. App. 1982).

Section 11.2, like current Sec. 10.2, would continue to provide for the OED Director. The proposed rule sets out the duties of the OED Director, including receiving and acting upon applications, conducting investigations concerning the moral character and reputation of individuals seeking registration, conducting investigations of possible violations by practitioners of the Office Rules of Professional Conduct, initiating disciplinary proceedings, dismissing complaints or closing investigations, and filing with the Director of the United States Patent and Trademark Office (``USPTO Director'') certificates of convictions of practitioners. Except as otherwise noted, any final decision of the OED Director refusing to register an individual, refund a fee, recognize an individual, or reinstate a suspended or excluded practitioner would be reviewable by the USPTO Director. A fee, set forth in 37 CFR 1.21(a)(5), would be charged.

Section 11.3 would provide for waiver of the rules and qualified immunity.

Paragraph (a) of Sec. 11.3, like current Sec. 10.170, would provide for suspension, except as provided in section (b), in an extraordinary situation, when justice requires, of any requirement of the regulations of this part which is not a requirement of the statutes.

Paragraph (b) of Sec. 11.3 would prohibit waiver of any provision of the Office Rules of Professional Conduct, Sec. Sec. 11.100 through 11.806; the disciplinary jurisdiction of the rules, Sec. 11.19; or the procedures for interim suspension and disciplinary proceeding based on reciprocal discipline or conviction of a serious crime, Sec. 11.24.

Paragraph (c) of Sec. 11.3, like current Sec. 10.170(b), would provide that a petition to waive a rule will not stay a disciplinary proceeding unless ordered by the USPTO Director or a hearing officer.

Paragraph (d) of Sec. 11.3 would provide a qualified privilege for complaints submitted to the OED Director. This privilege should arise from the necessity to reduce to the extent possible any probability that an ethics complainant having honest cause to complain may be intimidated by a practitioner into not filing a complaint. Some states recognize that a complainant has absolute immunity for filing a complaint regardless of the outcome of the proceeding. See Drummond v. Stahl, 127 Ariz. 122, 618 P.2d 616 (Ct. App. Div 1 1980), cert. denied, 450 U.S. 967, 101 S.Ct. 1484, 67 L. Ed. 2d 616 (1981); Katz v. Rosen, 48 Cal. App. 3d 1032, 121 Cal. Rptr. 853 (1st. Dist. 1975); Field v. Kearns, 43 Conn. App. 265, 682 A.2d 148 (1996), cert. denied, 239 Conn. 942, 684 A.2d 711 (1996); Jarvis v. Drake, 250 Kan. 645,830 P.2d 23 (1992); Kerpelman v. Bricker, 23 Md. App. 628, 329 A.2d 423 (1974); Netterville v. Lear Siegler, Inc., 397 So.2d 1109 (Miss. 1981); Sinnett v. Albert, 188 Neb. 176, 195 N.W.2d 506 (1972); Weiner v. Weintraub, 22 N.Y.2d 330, 292 N.Y.S.2d 667, 239 N.E.2d 540 (1968); Elsass v. Tabler, 131 Ohio App.3d 66, 721 N.E.2d 503 (1999); McAfee v. Feller, 452 S.W.2d 56 (Tex. Civ. App. Houston 14th Dist. 1970). Complaints filed with a state bar committee are absolutely privileged as communications made in a quasijudicial proceeding. E.g., Goldstein v. Serio, 496 So.2d 412 (La. Ct. App. 4th Cir. 1986), writ denied, 501 So.2d 208, 209 (La. 1987).

Under English common law, the ``absolute privilege'' from defamation actions that attaches to all statements and testimony by witnesses, judges, and parties in the course of any judicial proceeding has been held to apply to
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testimony and statements made in the course of solicitor disciplinary proceedings. See Addis v. Crocker, 1 Q.B. 11, 2 All E.R. 629 CA. See Halisbury's Laws of England, Libel and Slander 28:98101. Several states provide absolute privilege for complaints and testimony in ethics proceedings through statutes, court rules, or rules of attorney discipline. See Alaska Attorney Rules, Disciplinary Enforcement Rule 9 (Supp.1983); Ariz. Rules Regulating Conduct of Attorneys, Rule XII (Michie Supp. 1983); Cal. Art. 5.5 Sec. 6094 (1984); Colo.R.C.P. Rule 259(C) (Michie Supp. 1983); Stone v. Rosen, 348 So. 2d 397 (Fla.Dist.Ct.App. 3 1977); Ga. Code App. to Title 9, Part IV, State Bar Rule 4221(g); Hawaii S. Ct. Rule 16.7 (1992); La. Rev. Stat. Ann. Sec. 37 ch. 4 App., Art. of Incorp. Of La. State Bar Ass'n., Art. 15 Sec. 13 (West Supp. 1983); Minn. Rules of Law: Prof. Resp., Rule 21 (1977); Miss. Code Ann. Sec. 733345 (1992); N.J.S.Ct.Rule 1:20 11(b)(1984); Sullivan v. Crisona, 283 N.Y.S.2d 62 (Sup. Ct. 1967) (interpreting N.Y. Judiciary Law Sec. 90); N.D. Cent. Code Sec. 27 1403 (1974); Okla. Ct. Rules Governing Disciplinary Proc., Chap. 1, App. 1A, Rule 5, Sec.5.4 (1981); S.C. Rules on Disciplinary Procedure for Att'ys Sec. Sec. 11, 26 (Lawyers Coop. Supp. 1983) (complaints may be subject to contempt sanctions and injunction against malicious filing, but privilege prevents lawsuits predicated on filing or testimony); S.D. Codified Laws Ann. Sec. 161930 (1994); W. Va. State Bar Bylaws Art. VI Sec. 43 (1982); Wyo. Ct. Rules, Disciplinary Code for the Wyo. State Bar, Rule VI (1973).

Other jurisdictions provide qualified immunity or privilege. See Ind. S.Ct. Rules Part VI, Admission & Discipline Rule 23 Sec. 20 (1983) (immunity in absence of malice); Kan.S.Ct.Rule 223 (same privilege as attaches in other judicial proceedings); Me. Bar Rule 7(f)(1) (1983) (immunity in absence of malice); Neb.S.Ct. Rule 106 (1983) (absolute privilege for good faith complainant); In re Proposed Rules Relating to Grievance Pro., 341 A.2d 272 (N.H. 1975) (approving proposed rules effective July 25, 1975, Rule 10 providing immunity for statements made in good faith).

Communications made to licensing agencies in connection with an application for issuance, renewal, or revocation of a license have frequently been held to be entitled to absolute privilege. Alagna v. New York & Cuba Mail S.S. Co., 155 Misc. 796 279 NYS 319 (1935) (complaint to Federal Communications Commission complaining of conduct of licensed radio operators held absolutely privileged). Communications to Federal agencies responsible for protecting the public are privileged. See Holmes v. Eddy, 341 F.2d 477 (CA 4 1965) (holding communication to the Securities and Exchange Commission did not amount to defamation since Commission had statutory duty to protect public from frauds through stock issues, and communication was treated as confidential and not disclosed until beginning of court action); Riccobene v. Scales, 19 F.Supp 2d 577 (N.D. W. Va. 1998) (statements by attorney, representing Army officer's wife, to officer's superior made in course of representing the wife, are absolutely privileged as they were intended to obtain Army's help in ending domestic abuse, and Army had clear interest in receiving reports of domestic violence committed by soldiers).

A person filing a complaint with the Office is proscribed from providing materially false written statements. Under 18 U.S.C 1001(a) criminal penalties are provided for whoever, in any matter within the jurisdiction of the Office ``knowingly and willfully * * * (2) makes any materially false, fictitious, or fraudulent statement or representation; or (3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry.''

The Office is responsible for protecting the public from persons, agents and attorneys demonstrated to be ``incompetent or disreputable, or guilty of gross misconduct, or who does not comply with the regulations established under section 2(b)(2)(D) of'' the Patent Statute. 35 U.S.C. 2(b)(2)(D). The proposed rule provides potential complainants with appropriate notice of the qualified immunity while enabling the Office to fulfill its responsibility.

Recognition To Practice Before the USPTO

Section 11.4, like current Sec. 10.3, would provide for a Committee on Enrollment, which will advise the OED Director in connection with the Director's duties under Sec. 11.2(b)(2).

Section 11.5 would provide for keeping a register of attorneys and agents recognized to practice before the Office in patent matters, and a definition of practice before the Office.

Paragraph (a) of Sec. 11.5, like current Sec. 10.5, would continue to provide for maintaining a single register of attorneys and agents registered to practice before the Office. The proposed rule would conform to actual practice.

Paragraph (b) of Sec. 11.5 would add a new concept for disciplinary and nondisciplinary matters. The paragraph introduces definitions for practice before the Office broadly, as well as practice before the Office in patent matters, and practice before the Office in trademark matters. The proposed broad definition of practice before the Office is similar to the definition of ``practice'' adopted by the Internal Revenue Service. 31 CFR 10.2(e). Practice before the Office would not include the physical or electronic delivery of documents to the Office.

The definition of practice before the Office in patent matters is derived from Sperry v. Florida, 373 U.S. 379, 137 USPQ 578 (1963). In Sperry, the Supreme Court found that ``preparation and prosecution of patent applications for others constitutes the practice of law.'' The Court recognized that ``[s]uch conduct inevitably requires the practitioner to consider and advise his clients as to the patentability of their inventions under the statutory criteria, 35 U.S.C. 101103, 161, 171, as well as to consider the advisability of relying upon alternative forms of protection which may be available under state law. It also involves his participation in the drafting of the specification and claims of the patent application, 35 U.S.C. 112, which this Court long ago noted `constitute[s] one of the most difficult legal instruments to draw with accuracy,' Topliff [hairsp][hairsp]v. Topliff, 145 U.S. 156, 171. And upon rejection of the application, the practitioner may also assist in the preparation of amendments, 37 CFR 1.1171.126,\1\ which frequently requires written argument to establish the patentability of the claimed invention under the applicable rules of law and in light of the prior art. 37 CFR 1.119.'' Sperry, 373 U.S. at 383, 137 USPQ at 579.

\1\ 37 CFR 1.1171.119, and 1.1221.124 no longer exist.

Consistent with the foregoing, courts in several jurisdictions have held the preparation of patent applications by unregistered individuals to be the unauthorized practice of law. See In re Amalgamated Development Co., Inc., 375 A.2d 494, 195 USPQ 192 (D.D.C. 1977), cert. denied, 434 U.S. 924 (1977); People v. O'Brien, 142 USPQ 239 (N.Y. 1964); Cowgill v. Albright, 307 N.E. 2d 191, 191 USPQ 103 (Ct. App. Ohio 1973); and Virginia v. Blasius, 2 USPQ2d 1320 (Va. Cir. Ct. 1987).

In Ohio, the preparation, filing and prosecution of patent applications before the Office has been recognized as the practice of law. Formal Opinion 9125 (1991) of the Board of Commissioners on Grievances and Discipline of the Ohio Supreme Court.

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The definition of practice before the Office in trademark matters is derived in part from disciplinary cases concerning attorneys engaged to prepare and prosecute trademark matters. See Attorney Grievance Commission of Maryland v. Harper, 477 A.2d 756 (Md. 1984) (holding attorney neglected legal matter by failing to prosecute filed trademark application); State of Nebraska v. Gregory, 554 N.W.2d 422 (Neb. 1996) (holding attorney did not competently act or zealously represent a client by failing to file a trademark application); Office of Disciplinary Counsel v. Frease, 660 N.E.2d 1156 (Ohio 1996) (holding attorney neglected legal matter entrusted to him when he did not file applications for trademark registration). The definition is also derived from case law involving unauthorized practice of law wherein a layperson offered trademark registration services. See Statewide Grievance Committee v. Goldstein, 1996 Conn. Super. LEXIS 3430 (Conn. Super. 1996) (enjoining layperson from advertising, offering to complete, and completing blank legal documents for ``areas commonly understood to be the practice of law including * * * trademark and/or patent,'' soliciting information from customers and using the information ``to select, prepare or complete legal documents,'' and ``providing written and/or oral instructions to customers advising them what to do with their legal documents.'').

The definition of practice before the Office also includes private conduct relating to good character and integrity essential for a practitioner in patent, trademark, or other nonpatent law matters. The definition is derived from case law disciplining attorneys for misconduct not related to the practice of law. Any misbehavior, private or professional, that reveals a lack of good character and integrity essential for a person to practice as an attorney constitutes a basis for discipline. Matter of Hasbrouck, 657 A.2d 878 (N.J. 1995); In re LaDuca, 140, 299 A.2d 405 (N.J. 1973). That a person's activity does not arise from a lawyerclient relationship, that the behavior is not related to the practice of law or that the offense is not committed in the attorney's professional capacity is immaterial. In re Suchanoff, 460 A.2d 642 (N.J. 1983); In re Franklin, 365 A.2d 1361 (N.J. 1976).

Section 11.6, like current Sec. 10.6, would provide for registration of individuals to practice before the Office in patent matters.

Paragraphs (a) and (b) of Sec. 11.6 would provide for registration of attorneys and agents, respectively. Citizens of the United States could be registered regardless of their residence. The OED Director could register resident aliens, under appropriate circumstances. Registration of permanent resident aliens would be consistent with In re Griffiths, 413 U.S. 717 (1973) (permanent resident alien entitled to be admitted to Connecticut Bar notwithstanding status as alien). See also Raffaelli v. Committee of Bar Examiners, 496 P.2d 1264 (Cal. 1972) and Application of Park, 484 P.2d 1264 (Alas. 1971). The Office currently registers permanent resident aliens. See In re Bhogaraju, 178 USPQ 628 (Comm'r Pat. 1973); In re Bramham, 181 USPQ 723 (Comm'r Pat. 1974); and In re Keen, 187 USPQ 477 (Comm'r Pat. 1975).

The proposed rules would restrict circumstances under which an alien could be registered. Registration would be precluded if the practice of patent law before the Office is inconsistent with the terms of any visa under which the alien is admitted to and continues to reside in the United States. Registration would be precluded, for example, when the visa petition does not describe that the alien as being authorized to be employed in the capacity of representing patent applicants before the Office. See In re Richardson, 203 USPQ 959 (Comm'r Pat. 1979) (alien admitted to U.S. with H3 visa for training could not practice patent law under terms of the visa), and In re Mikhail, 202 USPQ 71 (Comm'r Pat. 1976) (alien admitted to U.S. on B1/ B2 visa and visiting the U.S. temporarily for business or pleasure could not practice under the terms of the visa). It is nevertheless appropriate for some aliens to be granted limited recognition under Sec. 11.9. See In re Messulam, 185 USPQ 438 (Comm'r Pat. 1975) (granting limited recognition to alien admitted to U.S. on L1 visa for purpose of rendering service to a single company for whom the alien had previously worked abroad and who would remain in the U.S. temporarily). See also In re Gresset, 189 USPQ 350 (Comm'r Pat. 1976).

Paragraph (c) of Sec. 11.6, like current Sec. 10.6(c), would continue to provide for registration of foreign patent agents on the basis of substantial reciprocity. Paragraph (c) would add procedures for removing a patent agent's name from the register if the patent agent is no longer registered in good standing before the patent office of the country in which he or she resides, or no longer resides in the foreign country. The procedures would avoid any necessity of going through an administrative proceeding.

Section 11.7, like current Sec. 10.7, would set forth the requirements for registration.

Paragraphs (a)(1) and (a)(2) of Sec. 11.7, like current Sec. 10.7(a), would continue to require an individual to apply for registration, and establish possession of good moral character, as well as legal, scientific and technical qualifications, and competence to advise and assist patent applicants.

Paragraph (a)(3) of Sec. 11.7 would explicitly place the burden of proof of good moral character and reputation on the applicant, and provide ``clear and convincing'' as the standard of proof.

Paragraph (b)(1) of Sec. 11.7, like current Sec. 10.7(b), would continue to require an individual to take and pass a registration examination in order to practice in patent matters before the Office.

Paragraph (b)(2) of Sec. 11.7 would identify components of a complete registration application, give an individual submitting an incomplete application 60 days from the notice to file a complete application, and require individuals to update their applications wherever there is an addition to or change to information previously furnished with the application.

Paragraph (c) of Sec. 11.7 would allow for a petition to the OED Director from any action refusing to register anindividual, refusing to admit an individual to the registration examination, refusing to reinstate an individual, or refusing to refund or defer any fee. The petition would be accompanied by the fee set forth in Sec. 1.21(a)(5).

Paragraph (d) of Sec. 11.7, like current Sec. 10.7(b), would continue to provide for waiver of the examination for former patent examiners. Unlike Sec. 10.7(b), waiver no longer would be available (except for a grandfathering provision) merely upon successfully serving in the patent examining corps for four years. Paragraph (d) would introduce new conditions for waiver of the registration examination for former patent examiners and expand the occasions for waiving the examination for other Office employees.

Currently, the requirement to take the examination may be waived in the case of any individual who has actively served for at least four years in the patent examining corps of the Office. The Office provides newly hired examiners with initial training. Thereafter, training provided by the Office is received on the job, or in more advanced formal training courses. Primary patent examiners are examiners who the Office has certified as having legal competence to act with a minimum of oversight. The Office also gives primary examiners a certificate granting authority to negotiate with
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practitioners. Before an examiner is promoted to primary patent examiner, a group of patent applications that he or she has examined is reviewed for competence and compliance with rules and procedures. However, no test is administered to ascertain the examiner's knowledge of patent law, practice and procedure. After an examiner achieves primary status, there is no periodic testing/training to ensure that the individual maintains an expected level of competency in law, regulations and practice and procedures. Currently, subsequent training takes place in the form of lectures or memoranda following changes to the patent law and/or regulatory changes.

To ensure competence the Office is instituting a formal certification and recertification program for patent examiners, in keeping with its 21st Century Strategic Plan. The program will require examiners being promoted to grade GS13 to pass a competency examination based on the examination taken by persons seeking to be registered as a patent practitioner.

Also, patent examiners, like licensed practitioners, would be required to receive training and pass recertification tests to update and maintain competence and proficiency in patent law, practices and procedures.

The proposed rule would provide for waiver of the registration examination for two groups of former patent examiners who were serving in the patent examining corps at the time of their separation.

Paragraph (d)(1) of Sec. 11.7 would address former patent examiners who, by a date to be determined, had not actively served four years in the patent examining corps, and who were serving in the corps at the time of their separation. The registration examination would be waived for a former examiner if he or she met four conditions. The former examiner must have (i) actively served in the patent examining corps of the Office, (ii) received a certificate of legal competency and negotiation authority; (iii) been rated, after receiving the certificate of legal competency and negotiation authority, at least fully successful in each quality performance element of his or her performance plan for the last two complete fiscal years as a patent examiner, and (iv) not have been under an oral or written warning regarding the quality performance elements at the time of separation from the patent examining corps.

Paragraph (d)(2) of Sec. 11.7 would address former patent examiners who, by a date to be determined, have actively served four years in the patent examining corps, and who were serving in the corps at the time of their separation. The examination would be waived for the former examiner if he or she meets three conditions. The former examiner must (i) have actively served for at least four years in the patent examining corps of the Office by the date to be determined, have been rated at least fully successful in each quality performance element of his or her performance plan for the last two complete fiscal years as a patent examiner in the Office; and (iii) not have been under an oral or written warning regarding the quality performance elements at the time of separation from the patent examining corps.

Requiring that an examiner be rated at least fully successful in the quality performance elements of his or her performance plan is in accord with prior practice. Former examiners, who upon separation from the Office, were rated unacceptable for quality performance elements have been required to take the registration examination. Accord, Commissioner's Decision, leg.01.pdf, posted on the Office Web site as http://www.uspto.gov/web/offices/com/sol/ foia/oed/legal/leg01.pdf.

Paragraph (d)(3) of Sec. 11.7 would address certain former Office employees who were not serving in the patent examining corps upon their separation from the Office. The examination would be waived for a former Office employee meeting four requirements. The former employee must demonstrate by petition that he or she possesses the necessary legal qualifications to render to patent applicants and others valuable service and assistance in the preparation and prosecution of their applications or other business before the Office by showing that (A) he or she has exhibited comprehensive knowledge of patent law equivalent to that shown by passing the registration examination as a result of having been in a position of responsibility in the Office in which he or she: (i) Provided substantial guidance on patent examination policy, including the development of rule or procedure changes, patent examination guidelines, changes to the Manual of Patent Examining Procedure, or development of training or testing materials for the patent examining corps; or (ii) represented the Office in patent cases before Federal courts; and (B) was rated at least fully successful in each quality performance element of his or her performance plan for the position for the last two complete rating periods in the Office, and was not under an oral warning regarding the quality performance elements at the time of separation from the Office.

Paragraph (d)(4) of Sec. 11.7 would provide additional conditions for waiver of the examination for each individual covered in paragraphs (d)(1) through (d)(3). To be eligible for consideration for waiver, the individual must file a complete application within two years of separation from the Office, together with the fee required by Sec. 1.21(a)(1)(i). All other individuals and former examiners filing an application or paying a fee more than two years after separation from the Office would be required to take and pass the examination in order to demonstrate competence to represent applicants before the Office. If the examination is not waived, the individual or former examiner also would have to pay the examination fee required by Sec. 1.21(a)(1)(ii) within 30 days of notice.

Paragraph (e) of Sec. 11.7 would eliminate the provision for regrade of an examination. The current rule requires the Office to treat each regrade request individually. Candidates requesting regrade seek, in effect, individualized regrading. Individualized regrading can promote the occurrence of arbitrary and capricious decisions.

The standard for review of the grading of the registration examination is ``whether the officials of the Patent Office acted fairly and without discrimination in the grading of the plaintiff's examination, pursuant to a uniform standard.'' See Cupples v. Marzall, 101 F.Supp. 579, 583 (D.D.C. 1952). The Office uses a set of model answers in grading examination answers. The use of Office Model Answers to grade the examination satisfies the Cupples standard ``because it provides a set of uniform standards by which all examinations can be fairly judged and is therefore not arbitrary and capricious.'' Worley v. USPTO, 2000 U.S. Dist. LEXIS 16992, 16997 (D.D.C. 2000). In contrast, ``permitting individualized and subjective regrading upon request would promote, not reduce, the likelihood that the Office would make arbitrary and capricious decisions regarding who passes and fails the Patent Bar examination.'' Worley, at 16998. See also Kyriazis v. Dickinson, No. 992299, slip op. at 7 (D.D.C. Dec. 8, 2000) (``this Court rejects Plaintiff's argument that a regrade of question 16 of the examination should consist of an individual determination as to whether Mr. Kyriazis's explanation for his answer constitutes the correct interpretation of patent law, rather than a determination whether the grading conformed with the PTO's Model Answers'').

To treat each regrade request individually requires dedication of [[Page 69448]]
considerable resources. Further, such regrades require release of both the questions and Model Answers. In turn, release of the questions and answers necessitates preparation of new examinations twice each year. Producing new examinations twice each year requires dedication of considerable resources. The Office is already pressed for staff and time to provide these services. The Office intends to change the delivery of the registration examination. The examination would no longer be administered twice a year in a paper and pencil format. Instead, a private sector party would deliver the examination at computer terminals at that party's test sites. It is anticipated that the examination would be administered each business day. The examination would not be delivered to applicants on the Internet. The registration examination is and will continue to be a multiple choice examination. The Office intends to develop a databank of multiple choice questions in following years that can be reused in subsequent examinations. The source of the questions and answers would be the patent laws, rules and procedures as related in the Manual of Patent Examining Procedure (MPEP) and policy statements issued by the Office. The examination would be ``openbook'' in the sense that the MPEP and policies would be accessible at the same computer terminals where the examination is taken. Paper forms of the MPEP or policies could not be brought into the private sector party's test site. New questions would be introduced as MPEP revisions or policy statements introduce new policies, rules, procedures, or statutory law changes. The USPTO would announce when questions are added to the data base addressing revisions of the MPEP or new policy statements. Questions would be retired as necessary and consistent with the changes. Reuse of questions could reduce the time and resources needed to develop the examination each time it is given. To reuse questions and reduce pressure on the staff, it would be necessary to cease publication of the questions and the corresponding answers. This would preserve the fairness of the test for later applicants.

The Multistate Bar Examination (MBE), like the registration examination, is a multiple choice examination. Questions on the MBE are reused in later years. An individual may review on his own MBE examination papers under the guidelines established by the National Conference of Bar Examiners, i.e., under supervision and without taking notes. See Fields v. Kelly, 986 F.2d 225, 227 (8th Cir 1993). Under proposed paragraph (g), an unsuccessful applicant would schedule an opportunity to review, i.e., inspect the examination questions and answers he or she incorrectly answered under supervision without taking notes. The questions could not be copied. This would be the same as the guidelines established by the National Conference of Bar Examiners for inspection of the MBE.

Under proposed paragraph (e), an unsuccessful applicant satisfying the admission requirements would have a right to sit for future examinations. The due process clause of the Fourteenth Amendment does not require that unsuccessful applicants be given the opportunity for a regrade. The applicant is afforded due process by permitting him or her to sit for the examination again. See Lucero v. Ogden, 718 F.2d 355 (10th Cir. 1983), cert. denied, 465 U.S. 1035, 79 L. Ed. 2d 706, 104 S.Ct. 1308 (1984) (``Courts have consistently refrained from entering the arena of regrading bar examinations when an unqualified right of reexamination exists.''); Tyler v. Vickery, 517 F.2d 1089, 1103 (5th Cir. 1975), cert. denied, 426 U.S. 940, 49 L. Ed. 2d 393, 96 S.Ct. 2660 (1976); Poats v. Givan, 651 F.2d 495, 497 (7th Cir. 1981); Davidson v. State of Georgia, 622 F.2d 895, 897 (5th Cir. 1980); Sutton v. Lionel, 585 F.2d 400, 403 (9th Cir. 1978); Whitfield v. Illinois Board of Bar Examiners, 504 F.2d 474, 478 (7th Cir. 1974) (Constitution does not require an unsuccessful applicant be permitted to see his examination papers and to compare them with model answers or answers of successful applicants); Bailey v. Board of Law Examiners, 508 F.Supp. 106, 110 (W.D. Tex. 1980); and Singleton v. Louisiana State Bar Ass'n., 413 F.Supp. 1092, 10991100 (E.D. La. 1976).

Limiting access to the questions would not deny the unsuccessful applicant equal protection of the laws. Inasmuch as some of the questions appear in following years, the questions must be kept secret in order to preserve the fairness of the test for later applicants. See Fields v. Kelly, 986 F.2d at 227. An unsuccessful applicant also is not deprived of a property right without due process by limiting access to the questions. Providing an opportunity to review the examination under supervision without taking notes affords the applicant a hearing at the administrative level. Id. at 228.

The Administrative Procedures Act provides procedural protections in matters involving an ``adjudication,'' which includes licensing. 5 U.S.C. 554. However, the Act also provides that these protections are not required where there is involved ``proceedings in which decisions rest solely on inspections, tests, or elections * * *. ``5 U.S.C. 554(a)(3). This subsection implicitly recognizes that ``where examinations are available, further procedural protections are unnecessary. See also 1 K. Davis, Administrative Law Treatise Sec. 7.09 (1958).'' Whitfield v. Illinois Board of Bar Examiners, 504 F.2d 474, 478 (7th Cir. 1974).

Paragraph (f) of Sec. 11.7 would continue the current practice in which applicants seeking reciprocal recognition under Sec. 11.6(c) must file an application and pay the fee set forth in Sec. 1.21(a)(6). It would introduce the practice of paying the application fee required by Sec. 1.21(a)(1)(i).

Paragraph (g) of Sec. 11.7 would continue the practice of soliciting information bearing on the moral character and reputation of individuals seeking recognition. If information from any source is received that tends to reflect adversely on the moral character or reputation of an individual seeking recognition, the OED Director would conduct an investigation into the individual's moral character and reputation.

The proposed regulation specifies that the information sought bearing on the moral character and reputation of individuals includes events regardless of whether the records have been expunged or sealed by a state court. In accordance with the supremacy clause of the United States Constitution, ``a federal agency acting within the scope of its congressionally delegated authority may preempt state regulation.'' Louisiana Public Service Comm'n. v. FCC, 476 U.S. 355, 369, 90 L. Ed. 2d 369, 106 S.Ct. 1890 (1986). The preemptive force of a Federal agency's regulation does not depend on express Congressional authorization. Instead, the correct focus is on ``the proper bounds of [the Federal agency's] lawful authority to undertake such action.'' City of New York v. FCC, 486 U.S. 57, 64, 100 L. Ed. 2d 48, 108 S.Ct. 1637 (1988).

Congress has authorized the USPTO Director to adopt regulations requiring individuals to demonstrate that they are of good moral character and reputation before being recognized. 35 U.S.C. 2(b)(2)(D). The statute does not mention expungement as a means for removing statutory disqualifications. Congress does not appear to have contemplated these expungements would limit the USPTO Director's authority under statute. Requiring disclosure of expunged offenses is a rational and
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reasonable method to promote licensing individuals presently possessing good moral character and reputation. In Dickerson v. New Banner Institute, Inc., 460 U.S. 103, 103 S.Ct. 986, 74 L. Ed. 2d 845 (1983), the Supreme Court held that an Iowa expungement of a judgment did not remove disabilities imposed by the Federal Gun Control Act of 1968 on the basis of the state conviction, and that the expungement did not nullify the conviction. Information regarding expunged offenses is clearly relevant to, though not necessarily determinative of, an applicant's moral character. See Wilson v. Wilson, 416 F.Supp. 984 (D. Oregon 1976). Expungement, for example, does not signify that the person was innocent of the crime. Rather, expungement alleviates certain continuing effects of a conviction under various laws. State bar examiners consider the commission of any crime, including expunged offenses, in weighing an applicant's overall character and fitness to practice law. See In re Leff, 619 P.2d 232 (Ariz. 1980); State Bar v. Langert, 276 P.2d 596 (Calif. 1954); Florida Board of Bar Examiners Re: Certified QuestionFelony ConvictionsFederal Youth Corrections Act, 361 So.2d 424 (Fla. 1978); In re Majorek, 508 N.W.2d 275 (Neb. 1993); In re McLaughlin, 675 A.2d 1101 (N.J. 1995); and In re Davis, 403 N.E.2d 189 (Ohio 1980). Requiring disclosure of arrests, even if a state court has ordered expungement, does not violate a constitutional right to privacy. See AFLCIO v. HUD, 118 F.3d 786 (D.D.C. 1997). The proposed rule would provide applicants with notice of the requirement for disclosure of expunged records.

The USPTO is seeking comments on the two alternatives proposed below for accepting a state bar's determination on the moral character of persons seeking to become registered practitioners who at the time of filing of their USPTO application, have been admitted as an attorney in a State Bar and continue to be in good standing.

One option is to require applicants who are attorneys to submit a certified copy of their State Bar application and moral character determination. The Office may accept the moral character determination as meeting the requirements set forth in Sec. 11.7(g).

The second option is to require these applicants to submit a certified copy of their State Bar application and moral character determination and for the Office to accept the State Bar's character determination as meeting the requirements set forth in Sec. 11.7(g) if, after review, the Office finds no substantial discrepancy between the information provided with their USPTO application and the State Bar application and moral character determination. In such a case, OED will accept the moral character determination of the State Bar as meeting the requirements set forth in Sec. 11.7(g), so long as this acceptance is not inconsistent with other rules and the requirements of 35 U.S.C. 2(b)(2)(D). If the USPTO finds that there is substantial discrepancy or if OED obtains or receives other or new information, or if the determination of moral character conflicts with other rules or Sec. 2(b)(2)(D), the USPTO reserves the right to make an independent decision.

The first option, accepting the state bar's determination on moral character without further review, is administratively convenient. However, it raises the issue of equal treatment between patent attorneys and patent agents as to standards applied. The nature of the patent application proceedings before the USPTO allows for registered practitioners to represent clients before the Office who may or may not be attorneys. In addition, ``Congress placed the responsibility on Director to protect the public.'' 35 U.S.C. Sec. 2(b)(2)(D).\2\ Under 35 U.S.C. Sec. 32, the USPTO is under an obligation to consider the moral character of all applicants seeking to become registered practitioners. The states and USPTO have concurrent authority to protect the public. Kroll v. Finnerty, 242 F.3d 1359 (Fed. Cir. 2001). Thus, the USPTO may not have authority to resolve all moral character questions of attorneys by deferral to the state determinations. Complete deference to a determination on moral character made by state bars is inconsistent with the USPTO's responsibility of protecting the public. Further, it is possible that state bars may be unaware of violations brought to the attention of the Office. The Office cannot circumvent its responsibility to protect the public. In tandem, it is not the Office's intent to place an unnecessary burden on state bars to make determinations on issues that can be equally addressed by both entities. Thus, while it is appropriate to consider the determination on moral character made by state bars as part of the application process at the USPTO, it is inconsistent with the statute to accept the state bar determination as dispositive of the issue for USPTO purposes.

Under the first option, the USPTO would give deference to the state bars if the Office allows patent attorneys to submit a copy of their state bar applications and moral character determinations. Under the second option, the USPTO would still give deference, but reserves the authority to look further into the issue of moral character if there is substantial discrepancy between the information provided in the USPTO application form and the state bar application or if new information is provided related to this matter. This is a satisfactory compromise that enables both the states and the USPTO to exercise their respective authorities to protect the public.

Paragraph (h) of Sec. 11.7 would define moral character. The definition is derived from Konigsberg v. State Bar of Cal., 353 U.S. 252, 77 S.Ct. 722, 1 L.Ed.2d 810 (1957); and In re Matthews, 462 A.2d 165 (NJ 1983). This paragraph also would provide a nonexclusive list of moral character factors considered by the OED Director. The list would be substantially the same as that considered by the Committee of Bar Examiners of the State Bar of California in ``Statement on Moral Character Requirement For Admission to Practice Law in California,'' which is available at http://www.calbar.org/shared/2admndx.htm.

Paragraph (h)(1) of Sec. 11.7 would provide not only that an applicant convicted of a felony or crime involving moral turpitude or breach of fiduciary duty is presumed not to be of good moral character, but also that the individual would be ineligible to apply for registration until two years after completion of any sentence and probation or parole. See In re Dortch, 687 A.2d 245 (Md. 1997); Seide v. Committee of Bar Examiners (Calif.), 782 P.2d 602 (Cal. 1989). The individual would have to pay the fee required by Sec. 1.21(a)(10) with the application for registration.

Paragraph (h)(4) of Sec. 11.7 would provide that an attorney disbarred or suspended from the practice of law, or an attorney who resigns in lieu of discipline would not be eligible to apply for registration for a period of two years following completion of the discipline. The OED Director would have discretion to waive the two year period only if the individual demonstrates that he or she has been reinstated to practice law in the State where he or she had been disbarred or suspended, or had resigned. The attorney would have to [[Page 69450]]
pay the fee required by Sec. 1.21(a)(10) with the application for registration.

Paragraph (i) of Sec. 11.7 would identify factors that may be taken into consideration when evaluating rehabilitation of an applicant seeking a moral character determination for registration.
\2\ ``[T]he primary responsibility for protection of the public from unqualified practitioners before the Patent [and Trademark] Office rests with the Commissioner of Patents [and Trademarks].'' Gager v. Ladd, 212 F.Supp. 671, 673, 136 USPQ 627, 628 (D.D.C. 1963), (quoting with approval Cupples v. Marzall, 101 F.Supp. 579, 583, 92 USPQ 169, 172 (D.D.C. 1952), aff'd, 204 F.2d 58, 97 USPQ 1 (D.C. Cir. 1953)).

Paragraph (j) of Sec. 11.7 would provide procedures for the OED Director and Committee on Enrollment to hear cases arising if the OED Director believes that any evidence suggests that an individual lacks good moral character and reputation. The procedures are in accord with those recognized in Willner v. Committee on Character and Fitness, 373 U.S. 96, 83 S.Ct. 1175 (1963) as providing due process. When the evidence is information supplied or confirmed by the individual, or is of an undisputed documentary character, the hearing will be on the written record. When a person or source whose reliability or veracity is questioned supplies the evidence, the individual may choose to have a hearing on the written record, or have an oral hearing to confront and crossexamine the person or source providing the evidence. The expense of an oral hearing could be a serious burden on an individual who is both distant from the Office and without an established practice. The rule provides such an individual with an alternative to an oral hearing, i.e., being heard on a written record with briefing. The procedures for an oral hearing are similar to those adopted by the District of Columbia Court of Appeals. Rule 46(f) and (g). An oral hearing will provide the Committee and OED Director with an opportunity to observe the individual's demeanor.

Paragraph (k) of Sec. 11.7 would allow an individual whose application for registration has been rejected because of lack of good moral character and reputation to reapply for registration. The individual would be permitted to reapply five years after the ruling, unless otherwise provided. The individual would also be required to take and pass the registration examination. This provision follows the same time provisions of Rule 201.12 of the Rules Governing Admission to the Bar of the State of Colorado. The individual would have to pay the fee required by Sec. 1.21(a)(10) with the application for registration.

Section 11.8 would continue the practice under current 37 CFR 10.8 of requiring an oath and payment of a fee prior to registration, and conform to the practice of filing a completed Data Sheet.

Paragraph (a) of Sec. 11.8 would provide a twoyear period within which an applicant who passes the registration examination may complete registration. In effect, a passing score would be good for two years. The Office would deem this period reasonable for individuals who have not been registered, and not completed their registration within two years. Their continued familiarity with the Patent Statute, Office practices and procedures, and changes thereto in the interim is not established, and they could not lawfully practice before the Office in patent matters in that period. The twoyear period is similar to the time afforded District of Columbia Bar applicants, who may request acceptance of a prior Multistate Bar Examination or essay exam result provided, inter alia, the prior administration of the examination was within 25 months of the examination about to be administered. See Rules 46(b)(8)(A)(3) and 46(b)(8)(B)(3) of the Rules of the District of Columbia Court of Appeals.

Under paragraph (a) of Sec. 11.8, limited recognition would no longer be granted to individuals while awaiting registration. The period candidates await registration is expected to be reduced by the Office's soliciting information tending to affect the eligibility of candidates based on their character on both the Office Web site as well as the Official Gazette. The names of the candidates receiving a passing score will be published. The public will be given 60 days from publication on the Web to provide the information.

Paragraph (b) of Sec. 11.8 would add procedures for applicants seeking registration as a patent attorney or agent. An individual seeking registration as a patent attorney would have to demonstrate that he or she is a member in good standing with the bar of the highest court of a state.

Paragraph (c) of Sec. 11.8 would codify a practice of requiring individuals to update the information and answers they provide on their applications based on events occurring between the date an individual signs an application, and the date he or she is registered or recognized to practice before the Office in patent matters. This would include not only changes of address, but also events that may reflect adversely on the individual's moral character. The latter would serve the integrity of the registration process to require the applicant to update information and answers, and show that the individual continues to satisfy the requirements of Sec. 11.7(a)(2)(i).

Paragraph (d) of Sec. 11.8 would introduce an annual fee to be paid by registered practitioners. The amount of the fee would be set forth in Sec. 1.21(a)(7). The annual fee would be due in threemonth intervals depending on the first initial of a practitioner's last name. The roster would be divided into four units. The payment period for last names beginning with AE shall be every January 1 through March 31; the payment period for last names beginning with FK shall be every April 1 through June 30; the payment period for last names beginning with L through R shall be every July 1 through September 30; and the payment period for last names beginning with S through Z shall be every October 1 through December 31.

In the past, the fees paid by applicants and patentees have supported the costs of the activities that maintain the patent practitioner's community reputation for integrity. The proposed annual fee is introduced pursuant to 35 U.S.C. 41(d). The annual fee is intended to fund the costs of the disciplinary system, and maintaining the roster of registered practitioners uptodate by (i) annually surveying the practitioners for current address/telephone/email information, and (ii) daily updating the roster with new changes of address. With an annual fee, the Office would be funding the discipl

FOR FURTHER INFORMATION CONTACT Harry I. Moatz ((703) 305-9145), Director of Enrollment and Discipline (OED Director), directly by phone, or by facsimile to (703) 3054136, marked to the attention of Mr. Moatz, or by mail addressed to: Mail Stop OEDEthics Rules, U.S. Patent and Trademark Office, P.O. Box 1450, Alexandria, Virginia 22313 1450.