Automating Patent Drafting (DRAFT White paper June 29, 2017) AI + patent preparation: Specifio augments law firm patent practices with cutting-edge deep learning and natural language generation technologies. It generates complete patent application drafts based on concise practitioner inputs. Practitioners can now maximize their time and expertise by focusing on the client experience and only key aspects of the patent preparation process. Specifio handles the rest with near-instantaneous turnaround. It s like text autocomplete, but for entire patent applications. With Specifio, there is no software to install or new tools to learn making it a seamless addition to any patent practice. The dramatically boosted per-practitioner throughput combined with increasingly popular fixed fee client billing translates to substantially improved profits-perhour. All content protected by copyright and other protective laws.
Dawn of automated legal writing: Recent technological advances are unlocking the potential of artificial intelligence and machine learning for applications in natural language generation. Legal documents are among the top candidates for automated writing tools. i Specifio utilizes a host of cutting-edge technologies including deep neural networks to mimic human writing capabilities for patent applications. By 2018, 20% of business content will be authored by machines. - Gartner i Addressing profitability: The profitability of patent preparation for law firms has been in decline due to a number of factors. More than ever, it is market forces rather than practitioner experience and competence that tend to drive fee amounts for preparing patent applications. The collision of these market-rate fee amounts with escalating hourly rates for practitioners creates a climate where often only entry-level and non-attorney practitioners can yield profitability. In some major general practice law firms, patent preparation is even viewed as a loss-leader practice to gain a position for licensing and litigation work. Complicating things further, a talent shortage is emerging with client demand for patent drafting ever increasing ii while the number of new patent practitioners minted each year trends downward iii. Original Utility Patent Applications Filed per Year in the U.S. ii Patent Applications Filed 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 1960 1970 1980 1990 2000 2010 2020 Year All content protected by copyright and other protective laws. 2
Patents 101: Patent applications are documents prepared by licensed patent practitioners. These professionals are either patent attorneys (scientists/engineers with a law degree) or patent agents (scientists/engineers without a law degree). Once prepared, a patent application is filed with the United States Patent & Trademark Office (USPTO) where it is examined by a Patent Examiner. Each application is ultimately rejected or allowed to issue as a U.S. Patent. A patent application has three main parts: claims, specification, and figures. The claims are a numbered list of sentences that precisely define what is being asserted as the invention. In other words, the claims attempt to define the boundary between what is regarded as prior art and what is considered as inventive (i.e., useful, new, and non-obvious). The specification is the longest section. It explains how to make and use the claimed invention. Finally, the figures complement the specification and depict all the claimed features. The name of the game is the claim. - Federal Circuit Judge Giles Rich iv Key aspects of patent preparation: Specifio was developed on the premise that most, if not all, critical information associated with an invention is embedded in the claims. Such critical information can include, for example: The core inventive concept Desired claim scope Appropriate vocabulary to describe the invention Considerations related to the prior art Legal precedent associated with the technology area of the invention The client s business strategy Competitor products Inventor and/or client preferences These are all key aspects that practitioners may consider when drafting claims. And with this crucial information baked into the claims, the corresponding specification, in large part, merely exists to provide statutory support for the claims. v This is where Specifio comes in. In only a few moments, Specifio creates robust first draft specifications (and formal figures for some technologies) based on practitioner-provided claims. These draft specifications are ready for practitioner review and any desired bolstering. All content protected by copyright and other protective laws. 3
Increase leverage without increasing headcount: Practitioners employing Specifio can easily accelerate the process of preparing patent applications by a factor of three or better. An application can go from 20-30% complete to 80-90% complete in a matter of seconds. Intuitive interface: Augmenting practice leverage with Specifio is simple with no need for significant modifications to existing processes. Practitioners interact with Specifio via email, much like they would with other members of their practice group. A practitioner just emails claims to Specifio and a first draft specification is returned moments later by reply email. Before Specifio generates a draft specification, it screens the claims to look for any errors or difficult-to-understand formats. If any are discovered, Specifio will return an email flagging the individual issues and providing recommendations for curing them. All content protected by copyright and other protective laws. 4
Practice impact by the numbers: Leading business strategists have identified profits-perhour as the most critical metric for production environments such as law firms. vi Below we show how Specifio can reliably quadruple profits-per-hour in connection with patent preparation by tripling per-practitioner throughput. This is illustrated by looking at a typical scenario involving software-related patent applications: The average hourly rate of a patent practitioner in the U.S. is about $375/hour. vii The average fee for a basic software patent application is about $7,500. vi Thus, the average hours billed per basic software patent application can be assumed to be about 20 hours. Finally, in this example, we use $2500/app as Specifio s fee, but this is for illustration purposes only. * Revenue 20 billed hours (traditional) 20 billed hours (with Specifio) One basic software patent Three basic software patent application at $7,500 (charged applications, each charged at a flat hourly or at a flat fee). fee of $7,500. Costs Profits $7,500 total revenue $2,500 practitioner salary + $2,500 overhead $5,000 total cost $2,500 law firm profit (Per practitioner per 20 hours of drafting software patent applications) $22,500 total revenue $2,500 practitioner salary $2,500 overhead + $7,500 Specifio fees ($2,500/app) $12,500 total cost $10,000 law firm profit (Per practitioner per 20 hours of drafting software patent applications) * Practitioners can contact info@specif.io for current pricing. While leverage models differ from firm to firm, and sometimes even from practice to practice within a single firm, the traditional leverage model for law firms follows the so-called Rule of Thirds one third of each billable hour is for the practitioner s salary, one third is for overhead (i.e., office space, utilities, staff, etc.), and one third is for the firm (i.e., the profits). Results may vary based on factors unique to individual practices and practitioners. All content protected by copyright and other protective laws. 5
Enhanced client service: Specifio lets practitioners keep up with client demand with rapid turnaround and more consistent work product. Also, rather than firms having to rely on entrylevel practitioners to achieve profitability, Specifio allows more experienced practitioners with relatively higher billing rates to be responsible for patent preparation and still be profitable. Specifio beats conventional outsourcing options as the choice approach for leveraging without hiring. Reliability and price are just the beginning. With Specifio, the application content is governed by the law firm practitioner the same individual that knows the client and interfaces with the inventors thus avoiding the disconnect experienced with out-of-touch contract attorneys. Clients get the quality they are paying for and applications that better fit their business goals. Data security: Keeping law firms confidential client information safe is paramount for Specifio. Practitioner-provided claims can be emailed to Specifio in password-encrypted Microsoft Word documents, which is how Specifio returns draft specifications. Specifio runs on secure U.S.- based servers and does not keep copies of confidential information like draft specifications or practitioner-provided claims. At every step of the way, confidential information is guarded from human eyes or other outside access. In addition, Specifio does not train its machine-learning models on the content of any practitioner-provided claims or draft specifications. This ensures there is never cross pollination between patent applications. All content protected by copyright and other protective laws. 6
Specifio 1.0: The initial version is focused on basic software patent applications. For these applications, all that Specifio needs is a method claim set containing one independent claim and any number of dependent claims. From this claim set, Specifio creates corresponding system claims, a complete specification supporting the system and method claims, and formal system and method drawing figures. Sample system figure Sample method figure Pricing: Specifio users begin with a 30-day free trial with unlimited access. Our hope is that this will be sufficient to incorporate our service into the practitioner s workflow to get a true sense of the value brought by Specifio. After the trial period, we will reach out to discuss a pricing model that works based on usage etc. We can do per-application fee structures or subscription-based fee structures. All content protected by copyright and other protective laws. 7
Becoming a user: Specifio is offered exclusively for patent practitioners registered to practice before the USPTO or their local patent office. To register, practitioners can simply visit https://specif.io/become-a-user/. Future versions: Specifio is being extended to support additional technology areas, handle more complex inventions, and generate richer content by applying the latest advances in natural language processing and machine learning including deep neural networks. About the founders: Ian C. Schick, Ph.D., J.D., Co-founder & CEO, is a veteran Big Law patent attorney, physicist, and AI/natural language programmer. He has significant prior involvement with startup companies dealing with natural language processing and machine learning. Kevin Knight, Ph.D., Co-founder & CTO, is a seasoned tech entrepreneur and leading expert in computational linguistics and artificial intelligence as the Director of Natural Language Technologies at USC s world-renowned Information Sciences Institute. Todd Mackey, MBA, Co-founder & COO/President, is a successful entrepreneur with a wide range of experience, having co-founded and/or scaled six companies, angel invested, raised venture capital, acquired several companies, and lead two successful exits, including a sale to a NYSE company. i Gartner Reveals Top Predictions for IT Organizations and Users for 2016 and Beyond, http://www.gartner.com/newsroom/id/3143718 (accessed on January 17, 2017). ii U.S. Patent Statistics Chart Calendar Years 1963 2015, https://www.uspto.gov/web/offices/ac/ido/oeip/taf/us_stat.htm (accessed on January 17, 2017). iii See Zachary Kinnaird, 2015 U.S. Patent Practitioner Trends, http://patentlyo.com/patent/2015/02/currentpatent-practitioner.html (accessed on January 17, 2017). iv Giles Sutherland Rich, Extent of Protection and Interpretation of Claims-American Perspectives, 21 Int'l Rev. Indus. Prop. & Copyright L. 497, 499 (1990) ( The U.S. is strictly an examination country and the main purpose of the examination, to which every application is subjected, is to try to make sure that what each claim defines is patentable. To coin a phrase, the name of the game is the claim. ). v See U.S. Patent Act 35 U.S.C. 112(a) ( The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor or joint inventor of carrying out the invention. ). vi See, e.g., Robert Feldmann, et al., Pushing Manufacturing Productivity to the Max, McKinsey Quarterly (May 2017). vii Report of the Economic Survey 2015, American Intellectual Property Law Association (AIPLA). All content protected by copyright and other protective laws. 8