Micro Entity Status Results in Lower Patent Office Fees

Rarely, but occasionally, some good news comes out of Washington.  This time it’s in the form of a new economic status resulting in lower fees for certain patent applicants.  The reduction in fees, courtesy of the recently enacted “Patent Reform Act”, can be significant.  Determining if you are qualified for the reduced fees under the Act can be complicated, especially for applicants employed by, or obligated to, institutions of higher learning, but for many of my clients, the calculation is rather straightforward.

Basically, you’ll need to establish that you’re entitled to the fees for a Small Entity as defined by 37 CFR 1.27, which has been in effect for years.  Generally speaking, a small entity is a person or company employing fewer than 500 workers.  It’s a little more complicated than that, but that’s the general rule.

Additionally, the Micro Entity Applicant needs to have filed fewer than four (4) applications previously—but the following applications do not count:  foreign-filed applications, provisional applications, PCT applications that did not proceed past the International Stage and applications resulting from prior employment, which have been assigned or are obligated to be assigned to that employer.

The Micro Entity Applicant also needs to satisfy a hopelessly complex Income Test, which currently appears to be set at about $150,000/year.  For applicants who are nearly above or below that figure, the calculations required to substantiate or verify your income might be more time consuming than warranted by the savings in fees.

Finally, the Micro Entity Applicant must not have assigned, granted or conveyed, and is under no obligation to assign, grant or convey, a license or other ownership interest in the application to an entity that would not meet the aforementioned Income Test.

As mentioned earlier, the applicant who qualifies for Micro Entity status will realize significant savings.  The 75% discount from the Large Entity fees applies to fees for filing, searching, examining, issuing, appealing and maintaining patent applications and patents. The Patent Office has a certification form that needs to be completed for each application, which should not be a deterrent to the qualified applicant.

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