Introduction
This article continues our analysis of over 89,000 patents to determine how the number of office actions to allowance during prosecution impacts litigation outcomes. Last month we discussed how prosecution length impacts invalidity rates during litigation.[1] Now we discuss how it impacts findings of infringement.

Almost every practitioner would hypothesize that a patent with a longer prosecution history will be less likely to be found infringing. Presumably, the longer a patent was in prosecution, the more likely the applicant will have narrowed the claims to avoid the art found by the examiner. Thus, more office actions should lead to narrower allowed claim scope, lessening the chance of the claims successfully reading on a potential infringer’s product or process. The analysis of litigation outcomes over a twenty-year period confirms this popular assumption – the more office actions a patent application receives before allowance, the less likely the issued patent will be found infringing during litigation. However, this trend varies based on examiner toughness. Surprisingly, there is almost no correlation between the likelihood of infringement and the number of office actions for patents examined by the toughest examiners. These results are discussed in detail below.

Data & Analysis
All data analyzed for this article was extracted from PatentAdvisor,[2] which is powered by Lex Machina.[3] PatentAdvisor has litigation data for patents that have completed litigation from March 1, 2000, onward, provided they have electronic file histories. The litigation data includes results from U.S. district courts through April 2021.[4] This resulted in a raw data set with 89,248 rows. We then excluded cases where there was no finding of infringement (for example, a case that was dismissed or ended in settlement). This ultimately leaves us with 6,382 outcomes from district court cases.[5]

Results
Next, we analyzed our data to see if the number of office actions correlates with infringement outcomes. Because the number of cases with 5 or more office actions is significantly smaller than cases with 0 to 4 office actions, these cases were grouped into a “5+” bucket.

 

 Figure 1: Plot of Infringement and No Infringement Rates Overall
R-squared: 0.76, RMSE: 0.032, Total Sample Size: 4654

Table 1: Data for Figure 1

 

Figure 1 is a plot of infringement outcomes for litigated patents in terms of percentage of total outcomes where there was a finding of infringement. The trendlines in Figure 1 show a negative correlation between the likelihood of infringement and the number of office actions, apparent by the R-squared value of 0.76, and a close fit of the data to the trendlines, with an RMSE of 0.032. In other words, the more office actions a patent application receives before allowance, the less likely the issued patent will be found infringed during litigation. The data shows a significant decrease in the likelihood of infringement — from 62% at 0 office actions to 45% at 5+ office actions — this trend supports the hypothesis of this article that more rejections lead to claims that are less likely to be found infringe due to the narrowed scope of the claims.

This article assumes that as the number of office actions increases, the applicant will make more amendments to overcome rejections, and each round of amendments will further narrow the scope of the claims.[6] For example, to overcome an obviousness rejection under § 103, the applicant may make amendments to the claims to differentiate the claimed subject matter from the cited art. Each amendment to a claim risks narrowing its scope, either directly by adding additional elements or indirectly via prosecution history estoppel.[7] Therefore, more office actions tend to lead to narrower claims. Because a patent’s claims are narrower, the likelihood that a given product or process would fall within the scope of the claims and infringe the patent should decrease, as hypothesized by this article and illustrated by the trendlines in Figure 1.

 

 

Figure 2: Plot of Infringement Rates by Examiner Toughness

Table 2: Data for Figure 2

 

Infringement data was further analyzed with respect to examiner “toughness.” This article hypothesizes that courts will be less likely to find infringement of patents examined in “tougher” art units due to such patents presumably having narrower claims. For toughness, this article borrows the definition used by PatentAdvisor, where examiners are categorized as “Red” (i.e., the toughest examiners with relatively low allowance rates and a high average number of office actions to allowance), “Yellow” (i.e., moderately tough examiners), and “Green” (i.e., the easiest examiners with relatively high allowance rates and a low average number of office actions to allowance).[8] The classification of an examiner as being Green, Yellow, or Red is based on a propriety calculation by PatentAdvisor, which they call an “ETA measurement.”[9] According to PatentAdvisor, the calculation is based on a number of factors, including the examiner’s allowance rate; years of service with the USPTO; and total number of issued patents, abandoned applications, and pending applications.[10] These factors are used to calculate a single value between 0 and 99, which is what PatentAdvisor calls an ETA measurement.[11] A Green examiner has an ETA measurement between 0.1 and 2.5 (inclusive). A Yellow examiner has an ETA measurement between 2.6 and 5.9 (inclusive). A Red examiner has an ETA measure of 6.0 and above.[12] This article adopts an identical definition of “Green,” “Yellow,” and “Red” examiners.

The allowance rates for each type of examiner compared to the infringement rates for patents examined by that type of examiner are shown in Table 3 below. Unexpectedly, the below table suggests that the allowance rate for an examiner does not affect the respective infringement rate for litigated patents examined by the examiner. Patents are found to be infringed approximately sixty percent of the time, regardless of the toughness of the examiner that examined the underlying patent application.

 

Table 3: Allowance and Infringement Rates by Examiner Toughness

 

When infringement rates are examined with respect to prosecution length, trends that differentiate between different types of examiners begin to appear. As seen in Figure 2 and Table 2, for patents examined by Green and Yellow examiners, there is a strong negative correlation between the likelihood of infringement and the number of office actions, with the trendlines having R-squared values of 0.51 and 0.48, respectively. These trends suggest that earlier allowances by these easier examiners lead to broader claims that are easier to infringe, which aligns with the hypotheses of this article. Notably, the likelihood of infringement for patents examined by the easiest examiners (“Green”) has the largest decline with increasing numbers of office actions, dropping from 67% for patents with only one office action to 33% for patents with five or more office actions. Similarly, the likelihood of infringement for patents examined by Yellow examiners declines from 63% for patents with only one office action to 43% for patents with five or more office actions. These trends for both Green and Yellow examiners align with the hypothesis of this article — that more office actions lead to narrower claims that lower the likelihood of infringement. In contrast, for patents examined by the toughest examiners (“Red”), there is almost no correlation between the likelihood of infringement and the number of office actions, with the trendline having an R-squared value of 0.013. The likelihood of infringement for these patents examined by Red examiners averages 61.5%. Interestingly, this trend suggests that patents examined by tougher examiners are able to more consistently win infringement claims compared to patents examined by easier examiners. These results seem to be in tension with the hypotheses of this article.

Assuming that tougher examiners more thoroughly review applications with respect to the prior art, applications allowed by these tough examiners should have relatively narrow claims regardless of the number of rejections preceding allowance, and thus we would expect the trendline to show a lower likelihood of infringement at all points. The flat trendline for Red examiners and higher baseline infringement rate suggests that additional rejections do not in fact cause applicants to narrow their claims.[15] This further suggests that the way applicants respond to rejections from the toughest examiners may be fundamentally different from the way applicants respond to rejections from easier examiners. For example, applicants facing a rejection from a Red examiner may be more likely to merely shift scope (i.e., change claim elements without adding additional elements) with their claim amendments rather than strictly narrow scope. Or, perhaps, the types of rejections issued by the toughest examiners are fundamentally different from the types of rejections issued by easier examiners. For example, Red examiners may be more likely to issue subject matter rejections under § 101 than other types of examiners, leading to different types of responses from applications (e.g., traversing arguments instead of amendments) that do not necessarily narrow the scope of the claims. Unfortunately, as noted previously, the data extracted from PatentAdvisor for this article does not include information on the specific types of rejections the patents received during prosecution, or the nature of the applicants’ responses to these rejections.

While the total difference in outcomes between Green and Red examiners is slight, it is worth noting that the outcomes for patents examined by Red examiners are much more consistent. This is evident not only by the trendline for Red examiners having a lower R-squared value, but also by the raw percentages. Red examiners maintain the best floor for infringement rate by office action (47% for Red examiners, compared to 33% for Green and 43% for Yellow). Furthermore, Red examiners also have the highest ceiling for infringement rate, by office actions, of the three examiner types (73% compared to 67% for Green and 63% for Yellow). Although the average allowance rate for Red examiners is substantially lower than the rates for Yellow and Green examiners (a lowest rate of 42.7%, compared to 65.9% and 83.2%, respectively), if an applicant is actually able to get its patent allowed by a Red examiner, the patent may be of substantially higher quality from both a validity and infringement perspective, and thus be of substantially higher value to the owner.

Conclusion
The data presented in this article reveals discernible trends with profound implications for patent prosecution and litigation strategies. Notably, as the number of office actions increases, there is a strong inverse relationship between the number of office actions and the success of patents in infringement cases. This proves true the common wisdom among patent practitioners – that protracted examination leads to narrow claims that are harder to infringe.

The results of this article also show that as average allowance rates decrease from Green examiners to Yellow and Red examiners, overall infringement rates remain generally unaffected. However, when infringement rates are examined with respect to prosecution length, it becomes clear that examiner toughness matters. Patents examined by the easiest examiners (Green) quickly become much worse with additional office actions, while patents examined by the toughest examiners (Red) there is almost no correlation between the likelihood of infringement and the number of office actions.

The findings of this research contribute valuable insights for patent practitioners, offering actionable guidance for optimizing both the prosecution and litigation processes to enhance portfolio value and improve the likelihood of successful litigation outcomes.

*This article is excerpted from the authors’ recent article in volume 38, issue 1 of the Harvard Journal of Law & Technology titled “The Myth of “Bad” Patents: Impact of Prosecution Length on Patent Litigation Outcomes” and is republished with permission. The full article is available at https://ssrn.com/abstract_id=5123132.

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