oversight

Review of Waste and Mismanagement at the Patent Trial and Appeal Board

Published by the Department of Commerce, Office of Inspector General on 2014-07-28.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

INVESTIGATIVE
REPORT

U.S. Patent and
Trademark Office
Review of Waste and
Mismanagement at the Patent
Trial and Appeal Board

FOR PUBLIC RELEASE
REPORT NUMBER 13-1077
JULY 28, 2014


U.S. Department of Commerce
Office of Inspector General
Office of Investigations
  U.S. DEPARTMENT OF COMMERCE                                                                                 OFFICE OF INSPECTOR GENERAL



Contents
Chapter 1: Introduction .................................................................................................... 1
   I.        Executive Summary ..............................................................................................................................1
   II. Scope and Methodology ......................................................................................................................4
   III. Organization of the Report ................................................................................................................4
Chapter 2: Background ..................................................................................................... 5
   I.        Overview of the PTAB ........................................................................................................................5
   II. Backlog ....................................................................................................................................................5
   III. America Invents Act .............................................................................................................................6
   IV. Legal and Regulatory Overview .........................................................................................................7
   V. Allegation to be Resolved ...................................................................................................................7
Chapter 3: Analysis .......................................................................................................... 10
   I.        Facts ...................................................................................................................................................... 10
        A. Structure of the PTAB ................................................................................................................. 10
        B.        Role of Paralegal Specialists ........................................................................................................ 12
        C. Role of the Paralegal Specialist Union ...................................................................................... 15
             1.      Part-time Employment, Furloughs, and Reductions-in-Force ......................................... 15
             2.      Job Duties and Details ............................................................................................................. 15
        D. Role of Supervisory Paralegal Specialists ................................................................................. 16
        E.        Performance Evaluations and Performance-Based Bonuses ................................................ 18
             1.      Paralegal Specialists................................................................................................................... 18
             2.      Supervisory Paralegal Specialists ............................................................................................ 20
        F.        Flexible Work Schedules and Telework Programs ............................................................... 21
             1.      Flexible Work Schedules – “Increased Flexitime Policy” ................................................ 21
             2.      Telework Arrangements – The PTAB “Hoteling Program” ........................................... 23
             3.      Enhanced Hoteling Flexibility – “50 Mile Radius Agreement” Option ......................... 24
             4.      Chief Judge 2’s Perceptions of the Telework Programs .................................................. 24
             5. Paralegal Specialists’ and Supervisory Paralegal Specialists’ Understanding of the
             Relevant Telework Policies ............................................................................................................. 25
        G. Fiscal Year 2009 Hiring Plan and Execution ............................................................................ 26
        H. Lack of Work and Other Time.................................................................................................. 28
        I.        Substantial Bonuses Awarded to Employees Despite the Levels of Other Time .......... 34


                                                                                                                                                     REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                                            OFFICE OF INSPECTOR GENERAL


       J.       PTAB Management Aware of Paralegal Specialists’ Use of Other Time ......................... 38
       K. Management’s Initial Efforts to Address Other Time Usage ............................................... 44
       L.       Changes Sparked by the OIG Referral ..................................................................................... 51
       M. Cost of the Mismanagement to the PTAB .............................................................................. 63
  II. Analysis................................................................................................................................................. 67
       A. PTAB Incurred Gross Waste in Poorly Executing Its Hiring Plan and Failing to Timely
       Address the Other Time Problem. ................................................................................................... 67
       B. Although Aware of the Waste, Supervisors and Management Ignored the Problem and
       Even Rewarded the Employees Committing the Waste. ............................................................. 69
       C. Paralegal Specialists Likely Violated Telework Rules in Logging Other Time. ................ 71
       D. Paralegals and Managers Violated Regulations, Executive Orders, and Policies in Failing
       to Report the Waste. ........................................................................................................................... 73
Chapter 4: Conclusions and Recommendations .......................................................... 75
  I.        Findings................................................................................................................................................. 75
  II. Conclusions ......................................................................................................................................... 75
  III. Recommendations ............................................................................................................................. 76




REPORT # 13-1077
U.S. DEPARTMENT OF COMMERCE                                                         OFFICE OF INSPECTOR GENERAL



Chapter 1: Introduction
In February and May 2013, the Office of Inspector General (OIG) received anonymous
whistleblower complaints alleging that, since 2010, Paralegal Specialists working with the Patent
Trial and Appeal Board (PTAB) at the United States Patent and Trademark Office (USPTO)
were being paid for not working. The complaints alleged that the Paralegal Specialists logged
“non-production time” when not working and were logging 50 to 70 hours of such time per 80-
hour pay period. At the time, the PTAB carried an extensive backlog of cases, averaging 21,200
matters awaiting disposition from Fiscal Years 2009 through 2013.1

The OIG conducted an investigation to verify the accuracy of these allegations, the PTAB’s
effectiveness and efficiency in its use of government resources, and the degree to which any
mismanagement issues were addressed.

     I.     Executive Summary

On August 21, 2013, the OIG initiated investigation 13-1077-I into allegations provided by
anonymous whistleblowers that paralegals at the USPTO’s Patent Trial and Appeal Board were
receiving full-time pay, but had insufficient workloads over a prolonged period of time. Our
investigation uncovered substantial, pervasive waste at the PTAB that endured for more than
four years and resulted in the misuse of federal resources totaling at least $5.09 million.

In 2008, the PTAB faced a growing backlog of appeals and sought to hire a wide array of new
personnel to tackle the influx of cases, including judges, Paralegal Specialists, and other staff. In
early 2009, the organization quickly hired 19 Paralegal Specialists, which increased its total
Paralegal Specialist staff to approximately 50. PTAB managers had recommended 17 of those
new hires, but the then-Chief Judge insisted – over the vocal objection of PTAB managers – on
hiring two additional paralegals because he apparently did not want to lose those positions
during an impending hiring freeze. The PTAB hired only one new judge before the USPTO
imposed that hiring freeze in 2009.

As a result, PTAB’s paralegals, who were largely dependent on judges for their work, had
insufficient workloads and considerable idle time during work hours. Many were frequently
paid to do nothing, despite the fact that PTAB’s backlog was growing rapidly at the same
time. PTAB managers, including its senior-most personnel, were aware of this problem as far
back as 2009, but remained confident that the problem would disappear once new judges were
appointed. That, however, would not occur for years, during which time many of PTAB’s
Paralegal Specialists had insufficient work to fill a full-time work schedule.

The problem grew so bad that the PTAB used a separate billing code for Paralegal Specialists to
charge those non-productive hours – “Other Time.” One Senior Manager described Other
Time as the “I don’t have work but I’m going to get paid code.” The volume of hours charged
to Other Time – which were hours that paralegals were paid their full salary, but were not
1   Years in this report refer to calendar years unless otherwise specified as fiscal years.




REPORT #13-1077                                                                                                   1
    U.S. DEPARTMENT OF COMMERCE                             OFFICE OF INSPECTOR GENERAL


working – was remarkably high and troubling. In 2011, PTAB paralegals logged more than
27,000 hours to Other Time, and in 2012, nearly 26,000 hours. Some paralegals were idle for
so long that they stopped telling their supervisors when they ran out of work and just waited
for their next assignment.

In fact, some PTAB paralegals charged more than 50% of their annual total work hours to
Other Time over the course of multiple consecutive years. The Paralegal Specialists with the
greatest average Other Time between Fiscal Years 2010 and 2013 logged the following
amounts:

              #1: 46% in 2010 and 60% in 2011;
              #2: 61% in 2010, 66% in 2011, and 13% in 2012;
              #3: 53% in 2010, 35% in 2011, 54% in 2012, and 33% in 2013; and
              #4: 56% in 2010, 55% in 2011, 47% in 2012, and 12% in 2013.

The OIG’s investigation revealed that Paralegal Specialists engaged in a variety of personal
activities while charging their time to Other Time. For instance, PTAB paralegals told the OIG
that, during hours logged as Other Time and therefore when they were getting paid from
federal resources, they:

              watched television;
              surfed the internet;
              used social media, such as Facebook;
              performed volunteer work for a charity from home;
              washed laundry;
              exercised at home;
              read books, the news, and magazines;
              shopped online; and
              cleaned dishes.

The evidence established that PTAB managers were completely aware of the volume of Other
Time hours during the relevant time frame and took little action to prevent such
waste. Worse, PTAB managers rewarded these paralegals – including those with extensive
Other Time hours – with performance bonuses of thousands of dollars apiece. For instance,
the paralegals described above, who logged more than 50% of their hours as Other Time some
fiscal years, received between $2,000 and $3,500 in performance awards each year.

In essence, PTAB management ignored the problem because they believed that hiring new
judges would resolve the problem. But the problem persisted for years. PTAB managers
periodically considered “special projects” to give paralegals more work. These efforts,
however, were feeble, half-hearted, and ineffective at addressing the problem. Some managers
also felt constrained by the paralegals’ labor Union, believing that any steps to address the
Other Time issue would create conflict with the Union.




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U.S. DEPARTMENT OF COMMERCE                                 OFFICE OF INSPECTOR GENERAL


Only after the OIG became aware of allegations of waste involving Other Time usage and
referred these complaints to the PTAB did PTAB management start to take the problem
seriously. Within hours of the direction from senior management to reduce the Other Time
levels to zero, managers developed a list of potential ways to do so. One of the first ideas was
implemented in May 2013 and brought Other Time levels to near zero.

In total, according to the OIG’s calculations, the usage of Other Time resulted in the waste of
federal resources of approximately $5.09 million between Fiscal Year 2009 and Fiscal Year
2013. We arrived at this estimate by adding the amount of wages paid for Other Time to the
bonuses provided to the Paralegal Specialists, Supervisory Paralegal Specialists, and certain
Senior Managers who oversaw paralegal operations. The amount of wages attributable to
Other Time logged during this period totaled more than $4.3 million. Paralegal Specialists and
Supervisory Paralegal Specialists received more than $681,000 in bonuses, and specific Senior
Managers who oversaw paralegal operations received more than $87,000 in bonuses.

What is most egregious, however, is the conduct of numerous federal employees at the PTAB
in connection with this waste. Although the Other Time problem was widely known
throughout the PTAB organization, no one seemed to take ownership of the issue. In the
worst cases, paralegals seemed content to have extensive idle time while collecting full salaries
and benefits, and PTAB management seemed to sit on their hands, anticipating the arrival of
judges at some unknown date in the future. We credit that one or more whistleblowers
eventually alerted the OIG to the waste, although we recognize that no one came forward for
more than three years as the Other Time problem grew.

In light of the waste uncovered over the course of this investigation, the OIG recommended
that the PTAB make several changes to prevent such problems in the future. For instance, the
OIG recommended that:

        The PTAB should examine Paralegal Specialist and Supervisory Paralegal Specialist
         workloads on a regular basis and implement a process to readjust workforce
         assignments, among other things, if employees have insufficient workloads.

        The PTAB should continue to reexamine its management structure to determine
         whether it is most efficient and effective to have so many layers of management
         overseeing paralegal operations.

        Because we found that the nature of the PTAB’s telework programs – and particularly,
         the combined effect of the programs – created an environment vulnerable to abuse, the
         PTAB should institute clearer telework rules, including what types of activities are
         permissible and impermissible on official duty, and the PTAB should provide regular
         training to all teleworking employees and their supervisors on those rules.




REPORT #13-1077                                                                                     3
     U.S. DEPARTMENT OF COMMERCE                                OFFICE OF INSPECTOR GENERAL


     II.   Scope and Methodology

The OIG conducted this investigation by interviewing relevant witnesses; reviewing numerous
records and policies; conducting data analytics; and researching applicable legal standards. The
OIG interviewed Paralegal Specialists, Supervisory Paralegal Specialists, and members of PTAB
management, including two of the Chief Administrative Patent Judges (Chief Judges) in charge at
the time. Witnesses were sworn and interviews were recorded. Some witnesses were
interviewed more than once. The OIG obtained records from several witnesses and the
USPTO, as well as data from the USPTO.

    III.   Organization of the Report

This report will begin with an overview of the PTAB, a description of the PTAB’s case backlog,
a summary of the America Invents Act, and a listing of the relevant regulations and policies at
issue in the investigation. After noting the allegations to be resolved, the report will discuss the
facts determined during the investigation and the OIG’s analysis of those facts. The report will
close with the OIG’s findings, conclusions, and recommendations for the USPTO.




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U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL



Chapter 2: Background
This chapter will provide an overview of the PTAB, its case backlog, the America Invents Act,
and the relevant regulations and policies.

     I.   Overview of the PTAB

The USPTO, a federal agency within the U.S. Department of Commerce, is responsible for
granting patents and trademark registrations.2 The PTAB is a component within the USPTO
whose purpose is to review appeals of decisions made by patent examiners and render
decisions on challenges made against existing patents.3 The organization is headed by a Chief
Judge and consists of various administrative patent judges, patent attorneys, and support staff,
including Paralegal Specialists.4 The PTAB was formerly called the Board of Patent Appeals and
Interferences (BPAI).5

    II.   Backlog

Since 2009, the PTAB has experienced a significant backlog of appeals, as shown in the table
below.

                                 Table 1. Backlog of PTAB Cases by Year6
                                             Fiscal Year             Case Backlog
                                                2009                    12,489
                                                2010                    17,754
                                                2011                    23,963
                                                2012                    26,484
                                                2013                    25,308

The OIG analyzed this backlog in a previous audit report, finding that the USPTO increased the
number of patent examiners on staff, which resulted in a rise in the volume of patent decisions



2 See USPTO, The USPTO: Who We Are, http://www.uspto.gov/about/index.jsp (last visited July 17, 2014); 35 U.S.C. § 1. Under
35 U.S.C. § 2, USPTO is “responsible for the granting and issuing of patents and the registration of trademarks,” among other
duties.
3 See USPTO, About the PTAB, http://www.uspto.gov/ip/boards/bpai/ptab_about.jsp (last visited July 17, 2014) [hereinafter About

the PTAB] (“The PTAB is charged with rendering decisions on: appeals from adverse examiner decisions, post-issuance
challenges to patents, and interferences.”). Under 35 U.S.C. § 6(b), PTAB is required to “(1) on written appeal of an applicant,
review adverse decisions of examiners upon applications for patents . . . ; (2) review appeals of reexaminations . . . ; (3) conduct
derivation proceedings . . . ; and (4) conduct inter partes reviews and post-grant reviews . . . .”
4 See About the PTAB, supra.
5 See Leahy-Smith America Invents Act, Pub. L. No. 112-29, §§ 3(j), 7, 125 Stat. 284, 290, 313 (2011) (current version at 35

U.S.C. § 6) [hereinafter America Invents Act].
6 OIG Investigative Record Form (IRF): Data Analysis; Memorandum from Chief Administrative Officer, USPTO, to the OIG 2

(undated; received by OIG on or about July 10, 2013) (on file with OIG) [hereinafter USPTO Response].




REPORT #13-1077                                                                                                                    5
     U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


released.7 That increase, in turn, caused a proportionate surge in appeals submitted to the
PTAB.8 As the volume of appeals grew, the PTAB’s judicial staffing level remained essentially
flat, resulting in a growing backlog of cases.9 PTAB personnel, including Paralegal Specialists,
were aware of this backlog during the time period in question for this report,10 and PTAB
management periodically communicated with staff regarding the status of the backlog.11

    III.   America Invents Act

In September 2011, the Leahy-Smith America Invents Act (AIA) was signed into law,
fundamentally changing the U.S. patent system from a “first to invent” system to one that grants
patents to the “first inventor to file” for a patent.12 The AIA also renamed the BPAI as the
PTAB and placed increased duties and responsibilities on the organization.13 Major provisions,
including the PTAB’s additional duty to review AIA-related cases, became effective in
September 2012.14

The AIA granted the USPTO the authority to set its own fees for patent-related services,
including appeals.15 As a result, in January 2013, the USPTO more than doubled the regular




7 See OIG, USPTO’s Other Backlog: Past Problems and Risks Ahead for the Board of Patent Appeals and Interferences, Report No.
OIG-12-032-A, 1, 5 (August 10, 2012) [hereinafter OIG Backlog Report].
8 See id. at 1.
9 See id. at 5.
10 See, e.g., OIG IRF: Interview with Paralegal 3, Tr. 997-1009 [hereinafter Paralegal 3 Interview]; OIG IRF: Interview with

Manager 2, Tr. 2040-46 [hereinafter Manager 2 Interview]; OIG IRF: Interview with Manager 1, Tr. 3699-800 [hereinafter
Manager 1 Interview]; OIG IRF: Interview with Manager 4, Tr. 2463-80 [hereinafter Manager 4 Interview]; OIG IRF: Interview
with Paralegal 7, Tr. 1556-73 [hereinafter Paralegal 7 Interview]; OIG IRF: Interview with Paralegal 2, Tr. 1794-96 [hereinafter
Paralegal 2 Interview]; OIG IRF: Interview with Paralegal 10, Tr. 1399-412 [hereinafter Paralegal 10 Interview].
11 See Paralegal 2 Interview, supra, at Tr. 1797-807; OIG IRF: Review of Documents from Paralegal 2 (October 3, 2012, e-mail

from Chief Judge 2 to “PTAB Users” congratulating and thanking them on their work to prevent the backlog from reaching
27,000 and making the backlog decrease) [hereinafter Paralegal 2 Documents]; OIG IRF: Interview with Paralegal 9, Tr. 1331-50
[hereinafter Paralegal 9 Interview] (the backlog was discussed at the “yearly state of the board meetings,” which took place mid-
fiscal year); Paralegal 10 Interview, supra, at Tr. 1406-12 (“anytime we have a board meeting, it is constantly like the number one
metric by which the success of the board is measured is how we’re doing on our backlog”).
12 See America Invents Act §§ 3,7.
13 See id. §§ 3(j), 7.
14 See id. §§ 3(n)(1), 7(e), 35; OIG IRF: Interview with Senior Manager 1, Tr. 308-11 [hereinafter Senior Manager 1 Interview];

OIG IRF: Interview with Senior Manager 2, Tr. 917-29 [hereinafter Senior Manager 2 Interview]. AIA-related cases include the
following: inter partes reviews (challenges to an existing patent nine months or more after issuance of the patent or at any time
for a first-to-invent patent), post grant reviews (challenges to an existing patent within nine months of the issuance of the
patent), covered business method reviews (challenges to a business method patent), and derivation proceedings (challenges by a
patent applicant to an existing patent based on the contention that the existing patent is derived from the applicant without the
applicant’s authorization). See America Invents Act § 7; OIG, USPTO Successfully Implemented Most Provisions of the America
Invents Act, but Several Challenges Remain, Report No. OIG-13-032-A, 2 (September 30, 2013) [hereinafter OIG AIA Report];
USPTO, Derivation Proceedings, http://www.uspto.gov/aia_implementation/faqs_derivation_proceedings.jsp (last visited July 22,
2014).
15 See America Invents Act § 11; OIG AIA Report, supra.




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U.S. DEPARTMENT OF COMMERCE                                                       OFFICE OF INSPECTOR GENERAL


appeal fees from $1,260 to $2,800 – an increase of 122%.16 Some of the new fees became
effective in March 2013, while others became effective in January 2014.17

 IV.      Legal and Regulatory Overview

Under federal law, all federal employees are required to “disclose waste, fraud, abuse, and
corruption to [the] appropriate authorities.”18 In addition, U.S. Department of Commerce
policies require that all U.S. Department of Commerce employees, including PTAB personnel,
report to the OIG “information indicating the possible existence” of activities that “may
constitute mismanagement, waste of funds, abuse of authority, or a violation of [a] law or
regulation.”19 Department policies also prohibit “[l]oafing, willful idleness, [and] wasting time”
and an “[a]ct of negligence or careless workmanship in [the] performance of duty resulting in
[a] waste of public funds or inefficiency.”20 Furthermore, the “[k]nowing failure of a [U.S.
Department of Commerce] officer or employee to comply with the reporting requirements . . .
may result in disciplinary action . . . .”21

PTAB personnel are also subject to other policies pertaining to telework, work schedules, and
labor agreements. These topics are discussed in subsequent sections of this report.

     V.   Allegation to be Resolved

In February 2013, the OIG received two anonymous whistleblower complaints alleging waste
and mismanagement at the PTAB. According to the first complaint, the current Chief
Administrative Patent Judge (Chief Judge 2) and other managers maintained a practice since
2010 of approving 50 to 70 hours per pay period of “other non-classified time” (code A00131,
also known as Other Time) for Paralegal Specialists who work from home.22 The complaint
further alleged that Other Time meant “employees [we]re doing nothing,” despite the PTAB’s
backlog of cases.23

The second complaint similarly alleged that, despite its extensive backlog, the PTAB had been
allowing paralegals to log 60 to 70 hours of Other Time per pay period.24 The whistleblower


16 See 78 Fed. Reg. 4212, 4224, 4230-31 (January 18, 2013); USPTO, Setting and Adjusting Patent Fees: At a Glance, 27, 31 (January
18, 2013), http://www.uspto.gov/aia_implementation/AC54_Section_10_Fee_Setting-Final_Rule_Fee_Setting_At_a_Glance-
1_18_2013.pdf [hereinafter USPTO Fees]. Filers qualifying for “small entity” status pay 50% of the regular fees – $1,400, which
represents an increase of $770, or 122%, over the previous small entity fees of $630. See 78 Fed. Reg. at 4224, 4230. Filers
qualifying for “micro entity” status, a new status for some filers that previously fell within the small entity status, pay 25% of the
regular fees – $700, which represents an increase of $70, or 11%, over the previous small entity fees of $630. See id. The
USPTO estimated that 25% of all filers would qualify for small entity status and 6.2% or 7.8% of all filers would qualify for micro
entity status. See id. at 4221.
17 See 78 Fed. Reg. at 4212.
18 5 C.F.R. § 2635.101(b)(11) (2014); Exec. Order No. 12674 § 101(k).
19 DOC Department Administrative Order 207-10 (3.01), (3.04).
20 DOC Department Administrative Order 202-751, App. B.
21 DOC Department Administrative Order 207-10 (3.04).
22 See Hotline Tip from Anonymous Complainant #1, Case No. 13-0446 (Feb. 4, 2013).
23 See id.
24 See Hotline Tip from Anonymous Complainant #2, Case No. 13-0446 (Feb. 13, 2013).




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     U.S. DEPARTMENT OF COMMERCE                                           OFFICE OF INSPECTOR GENERAL


further stated that he or she did not want to sit on the clock for 60 or 70 hours while doing
nothing.25

After reviewing the complaints, the OIG referred the matter to the USPTO and required the
USPTO to conduct an administrative inquiry and report back to the OIG.26 In May 2013, prior
to receiving USPTO’s response, the OIG received a third anonymous complaint stating that the
OIG was investigating the PTAB, and PTAB employees were instructed to charge hours to
code “L00131” so that their hours would not show as non-production.27 The whistleblower
further stated that, instead of being given new cases to work on, employees were being tasked
with reviewing work that had already been completed.28 Additionally, the whistleblower
related that, despite PTAB management’s instruction, PTAB employees were still logging Other
Time as of May 17, 2013.29 The OIG forwarded this complaint to the USPTO for incorporation
into the USPTO’s administrative inquiry.30

In July 2013, the USPTO provided the OIG with a report of its inquiry.31 The USPTO
described the focus of its inquiry as follows: “Whether PTAB managers authorized and
approved compensation for ‘Other Non-Classified Time,’ commonly referred to within PTAB
as non-production time or ‘Other Time,’ . . . for time periods that employees were not
assigned and did not perform any work?”32 In its report, the USPTO concluded as follows:

                  Based on the evidence provided by [three members of senior
                  management], the [USPTO]’s investigation concluded that the
                  allegations that PTAB management has authorized and approved
                  PTAB employees to claim pay for time that they were not
                  assigned and did not perform production or non-production work
                  was SUBSTANTIATED.33

The USPTO stated that it found that, for four and a half years, from October 1, 2008, to May 4,
2013, Paralegal Specialists logged and were compensated for a total of 102,108 hours of Other
Time.34 The USPTO estimated that it paid $4,289,424 in wages for this Other Time.35
Furthermore, the USPTO estimated that it paid Paralegal Specialists an additional $132,032.61
in productivity-based performance bonuses in Fiscal Year 2012, “even though a paralegal's
‘productivity’ was increased by not factoring in all of the paid time spent not performing
work.”36



25 See id.
26 See Memorandum from OIG to USPTO, 1 (Feb. 13, 2013) (on file with OIG).
27 See Hotline Tip from Anonymous Complainant #3, Case No. 13-0803 (May 21, 2013).
28 See id.
29 See id.
30 See E-mail from OIG to USPTO (Jun. 12, 2013) (on file with OIG).
31 See USPTO Response, supra.
32 See id. at 2.
33 Id. at 6.
34 See id. at 4.
35 See id. at App. A (discussing the amount of Other Time logged by paralegals).
36 See id. at Ex. 12 (discussing performance awards paid to paralegals).




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U.S. DEPARTMENT OF COMMERCE                                    OFFICE OF INSPECTOR GENERAL


The USPTO stated that, to “ensure that PTAB improves the management of employees and
ceases to have employees who are not working their full schedules,” it would

                  conduct an activity based information . . . and workload/utilization
                  analysis for the resources consumed and activities or processes
                  completed by paralegal staff supporting the [PTAB] . . . so as to
                  assess optimal staffing requirements. To ensure PTAB is
                  successful, the [USPTO] is appointing an outside senior
                  management specialist to advise on and oversee PTAB’s
                  corrective efforts, and to report on the same to the [USPTO]’s
                  Chief Administrative Officer, who will regularly update the
                  [USPTO]’s Chief Financial Officer, until fully resolved.37

After reviewing USPTO’s report, the OIG initiated this investigation into the causes and extent
of the waste, mismanagement, and policy violations at the PTAB, and whether management had
addressed the mismanagement.




37   Id. at 6.




REPORT #13-1077                                                                               9
     U.S. DEPARTMENT OF COMMERCE                                                  OFFICE OF INSPECTOR GENERAL



Chapter 3: Analysis
     I.   Facts

      A. Structure of the PTAB

During the time period relevant to the OIG’s investigation, the PTAB’s organizational structure
underwent several changes, but can be generally described as follows.38 The PTAB was led by a
Chief Judge, who supervised two Vice Chief Administrative Patent Judges (Vice Chief Judges).39
At the beginning of the relevant time frame, the Chief Judge supervised an Administrative
Officer (referred to as a Senior Manager in this report), who led the administrative staff.40 The
Administrative Officer was responsible for non-legal administrative functions, including
information technology, procurement, and human resources.41 Each Vice Chief Judge was in
charge of one of two divisions, Division 1 or Division 2, and directly supervised line-level judges
and Support Administrators (also referred to as Senior Managers in this report), who were
responsible for the legal support functions within the division.42 The line-level judges were
organized by subject matter and a Lead Judge headed each team.43

Reporting to each Support Administrator was a senior-grade Supervisory Paralegal Specialist
(referred to as Senior Managers44) who, in turn, supervised several lower-grade Supervisory
Paralegal Specialists (referred to as such or as first-line Supervisory Paralegal Specialists).45 Each
Supervisory Paralegal Specialist was in charge of a team of Paralegal Specialists.46 The Paralegal
Specialist teams were organized by the subject matter of the patent cases they reviewed.47
Division 1’s teams included the Biotechnology Team, Computers Team, Contested Cases


38 See, e.g., Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010, and PTAB organizational chart,
effective Mar. 27, 2014); OIG IRF: Interview of Manager 1, Exs. 1-2 [hereinafter Manager 1 Interview] (PTAB organizational
charts); OIG IRF: Interview with Managing Judge 1, Tr. 81-175, 318-421 [hereinafter Managing Judge 1 Interview]; OIG IRF:
Interview with Chief Judge 2, Tr. 1137-50 [hereinafter Chief Judge 2 Interview]; OIG IRF: Interview of Senior Manager 5, Tr. 395-
96 [hereinafter Senior Manager 5 Interview].
39 See Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010, and PTAB organizational chart, effective

Mar. 27, 2014); Manager 1 Interview, supra, at Exs. 1-2; Managing Judge 1 Interview, supra, at Tr. 81-175, 318-421; Chief Judge 2
Interview, supra, at Tr. 1137-50; Senior Manager 5 Interview, supra, at Tr. 395-96.
40 See Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010, and PTAB organizational chart, effective

Mar. 27, 2014); Managing Judge 1 Interview, supra, at Tr. 86-128; Manager 1 Interview, supra, at Ex. 1-2.
41 See Senior Manager 5 Interview, supra, at Tr. 517-25.
42 See Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010, and PTAB organizational chart, effective

Mar. 27, 2014); Manager 1 Interview, supra, at Ex. 1-2.
43 See Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010, and PTAB organizational chart, effective

Mar. 27, 2014); Manager 1 Interview, supra, at Ex. 1-2.
44 Both Support Administrators and Supervisory Paralegal Specialists are referred to as Senior Managers in this report.
45 See Paralegal 2 Documents, supra (PTAB organizational chart, effective August 29, 2010, and PTAB organizational chart,

effective March 27, 2014); OIG IRF: Documents #2 from Managing Judge 1 [hereinafter Managing Judge 1 Documents #2] (e-mail
from Senior Manager 4 describing organizational structure); Senior Manager 1 Interview, supra, at Tr. 59-95; OIG IRF: Interview
with Senior Manager 2, Tr. 55-97 [hereinafter Senior Manager 2 Interview].
46 See Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010, and PTAB organizational chart, effective

Mar. 27, 2014); Managing Judge 1 Documents #2, supra (e-mail from Senior Manager 4 describing organizational structure).
47 See Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010). Supervisory Paralegal Specialists are

referred to as Managers in footnotes.




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U.S. DEPARTMENT OF COMMERCE                                                     OFFICE OF INSPECTOR GENERAL


Team, and Interference Team.48 Division 2’s teams included the Chemical Team,
Communications and Electrical Team, and Mechanical and Business Methods Team.49 These
team names were the same as those for the judges.50 However, despite their names, the
Paralegal Specialist teams did not require knowledge or expertise in their designated subject
matter.51 Thus, the team names were merely a management vehicle to divide Paralegal
Specialists into smaller units.52

The Chief Judge reported to the Deputy Undersecretary of Commerce for Intellectual
Property and Deputy Director of the USPTO (USPTO Deputy Director), who, in turn,
reported to the Undersecretary of Commerce for Intellectual Property and Director of the
USPTO (USPTO Director).53 From April 2005 until he retired on January 1, 2011, Chief Judge
1 served as Chief Judge.54 Chief Judge 1 declined OIG’s request to be interviewed for this
investigation, and because he is no longer a federal employee, the OIG cannot require him to
provide a statement or participate in an interview.55 Following Chief Judge 1’s retirement in
January 2011, a Vice Chief Judge (Managing Judge 1) served as Acting Chief Judge until May
2011.56 During those months, he also retained his position of Vice Chief Judge.57 In May 2011,
Chief Judge 2 became Chief Judge.58 All of the employees at the PTAB ultimately reported to
the Chief Judge.59 See Appendix A for organizational charts.

Managing Judge 1 told the OIG that during Chief Judge 1’s tenure as Chief Judge, the PTAB’s
administrative functions reported directly to Chief Judge 1.60 Managing Judge 1 stated, however,
that Chief Judge 1 later changed the organizational structure so that certain administrative
functions fell within the purview of the Vice Chief Judges.61 Chief Judge 1 made this change
over the objections of the two Vice Chief Judges, including Managing Judge 1, who directly
supervised dozens of judges at the time.62 Subsequent to this change, one of the two Vice Chief
Judges resigned, leaving Managing Judge 1 as the sole Vice Chief Judge who directly supervised
upwards of 100 PTAB employees.63 After Chief Judge 1 retired, Managing Judge 1 continued to
be the sole Vice Chief Judge while acting temporarily as Chief Judge, essentially filling the role of

48 See Paralegal 2 Documents, supra (PTAB organizational chart, effective Aug. 29, 2010).
49 See id. (PTAB organizational chart, effective Aug. 29, 2010).
50 See id. (PTAB organizational chart, effective Aug. 29, 2010, and PTAB organizational chart, effective Mar. 27, 2014); Manager 1

Interview, supra, at Ex. 1-2.
51 See OIG IRF: Review of Outside Consulting Firm Report, Attach. 1 at 27, 48 [hereinafter Outside Consulting Firm Report]; OIG

IRF: Interview of Paralegal 4, Tr. 178-96 [hereinafter Paralegal 4 Interview].
52 See Outside Consulting Firm Report, supra, at 27, 48.
53 See Chief Judge 2 Interview, supra, at Tr. 3062-66; USPTO, Organizational Chart,

http://www.uspto.gov/about/bios/uspto_org_chart.pdf (last visited July 23, 2014).
54 See OIG IRF: Second Set of Documents Received from Office of Human Resources [hereinafter OHR Documents II]; Managing

Judge 1 Interview, supra, at Tr. 147-60, 165-75. Managing Judge 1 recalled beginning his role as Acting Chief Judge in 2010. Id. at
Tr. 147-60, 165-75.
55 See Case Notes 39 and 42 (attempts to interview Chief Judge 1).
56 See OHR Documents II, supra; Chief Judge 2 Interview, supra, Tr. 82-92; Managing Judge 1 Interview, supra, at Tr. 86-98, 147-60.
57 See OHR Documents II, supra; OIG IRF: Chief Judge 2 Interview, supra, at Tr. 82-92; Managing Judge 1 Interview, supra, at Tr. 86-

98, 147-60.
58 See OHR Documents II, supra; OIG IRF: Chief Judge 2 Interview, supra, at Tr. 82-92.
59 See Managing Judge 1 Interview, supra, at Tr. 318-21.
60 See id. at Tr. 345-91.
61 See id.
62 See id.
63 See id. at Tr. 325-91; OIG IRF: Documents #1 from Managing Judge 1, Ex. 3 at 3 [hereinafter Managing Judge 1 Documents #1].




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     U.S. DEPARTMENT OF COMMERCE                                                     OFFICE OF INSPECTOR GENERAL


the top three managerial positions at the PTAB simultaneously until Chief Judge 2 became Chief
Judge in May 2011.64

Between Fiscal Years 2009 and 2013, the total number of Paralegal Specialists who worked at
the PTAB in any given pay period ranged between 38 and 51.65 In Fiscal Year 2009, the start of
the relevant time period, the number of Paralegal Specialists increased dramatically from
approximately 32 to 51; then the number decreased over the next few years. The number of
judges did not increase until Fiscal Year 2012. Table 2 below shows the total number of
individuals who worked at the PTAB in a given year as a Paralegal Specialist, judge, or
Supervisory Paralegal Specialist.66

                        Table 2. Judge, Paralegal Specialist, and First-Line
                      Supervisory Paralegal Specialist Staffing By Fiscal Year67
                                                                                                      First-Line
                   FY               Judges           Paralegals        Judges: Paralegals            Supervisory
                                                                                                 Paralegal Specialists
                 2009                  82                 51                 ~1 ½ : 1                      8
                 2010                  79                 49                 ~1 ½ : 1                      8
                 2011                  70                 46                 ~1 ½ : 1                      8
                 2012                 152                 41                 ~3 ½ : 1                      8
                 2013                 168                 38                 ~4 ½ : 1                      8

      B. Role of Paralegal Specialists

During the time frame in question, Paralegal Specialists largely worked on ex parte appeals,
inter partes appeals, reexamination cases, interferences, and, after September 2012, AIA cases.68
More specifically, Paralegal Specialists performed intake case reviews to determine whether a
case delivered to the PTAB complied with relevant statutory requirements, and if it did not, the
Paralegal Specialist would write a brief memorandum to the appellant indicating why the appeal
failed to conform with statutory requirements.69 Paralegal Specialists also created docketing
notices; docketed cases; and created electronic working files (eWFs), which were case files that
included pertinent documents for the judges to render their opinions.70 After the judges

64 See Managing Judge 1 Interview, supra, at Tr. 411-21.
65 OIG IRF: Data Analysis, supra.
66 The table does not reflect week-by-week variations as individuals came and left the organization. As noted previously, in this

report, the term “Supervisory Paralegal Specialist” only refers to a first-line supervisor of Paralegal Specialist, and although
technically second-line supervisors of the Paralegal Specialists are also classified as Supervisory Paralegal Specialists, we identify
them as Senior Managers in this report for clarity.
67 OIG IRF: Data Analysis, supra. Totals reflects the number of paralegals and judges employed at any point in the fiscal year. In

2008, there were nine team leads, who were classified as Paralegal Specialists and became Supervisory Paralegal Specialists in
2009.
68 At the end of 2012, when much of the AIA became effective, trial work falling under the AIA began to “ramp up.” OIG IRF:

Interview with Paralegal 1, Tr. 741-48 [hereinafter Paralegal 1 Interview].
69 Paralegal 3 Interview, supra, at Tr. 470-78.
70 Paralegal 1 Interview, supra, at Tr. 629-37. One Senior Manager noted that the PTAB is currently creating a new information

technology system that would create the eWFs, and therefore Paralegal Specialists have stopped creating eWFs at this time.
Senior Manager 1 Interview, supra, at Tr. 794-800.




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U.S. DEPARTMENT OF COMMERCE                                                        OFFICE OF INSPECTOR GENERAL


drafted their opinions on the cases and sent them to the Paralegal Specialists, the Paralegal
Specialists proofread and edited the decisions for grammar and style71 and verified citations.72
The Paralegal Specialists then provided the judges with their edits, and the judges reviewed and
finalized the opinions, which the Paralegal Specialists then mailed to the parties.73 The Paralegal
Specialists also uploaded opinions to the eFOIA system74 and, on occasion, performed legal
research.75 Paralegal Specialists did not generate their own work; they relied on others,
particularly judges, to give them work.76

Paralegal Specialists used computers to perform most of their work.77 They had an electronic
communication tool, which they could use to message in real-time their supervisor or other
Paralegal Specialists who were online. Each Paralegal Specialist and his or her supervisor could
view whether a Paralegal Specialist or the Supervisory Paralegal Specialist was online through
this tool. The communicator tool used different colors to indicate a user’s status: a green light
(the user was online and active); a yellow light (the user was online and inactive); a white light
(the user was not online); and a red light (do not disturb the user).78

According to several Paralegal Specialists interviewed by the OIG, they believed that they
possessed the skills necessary to accomplish the tasks assigned,79 although a couple of them
noted that they did not receive enough training to do the AIA cases.80 Some asked for more
responsibility, such as drafting opinions.81 A Senior Manager noted to the OIG that more than
15 Paralegal Specialists had law degrees,82 and a key member of management stated to the OIG
that he believed that this set of Paralegal Specialists were hard workers and were far more

71 Paralegal 2 Interview, supra, at Tr. 419-23. They also reviewed decisions to ensure that the parties’ names and dates in the
opinion were correct and inputted case information. Paralegal 3 Interview, supra, at Tr. 462-65.
72 Paralegal 3 Interview, supra, at Tr. 452-57.
73 The paralegals would not physically mail the opinions; rather, they would send them to a central receptionist who would

print them and mail them from the USPTO headquarters, or the paralegals would send them electronically, if appropriate.
Paralegal 1 Interview, supra, at Tr. 639-46.
74 Id. at Tr. 648.
75 Id. at Tr. 724-35; Paralegal 3 Interview, supra, at Tr. 435-50.
76 Paralegal 1 Interview, supra, at Tr. 1552-58; Paralegal 10 Interview, supra, at Tr. 1456-57.
77 See, e.g., OIG IRF: Interview with Paralegal 5, Tr. 680-83 [hereinafter Paralegal 5 Interview]; Paralegal 3 Interview, supra, at Tr.

384-86.
78 See, e.g., OIG IRF: Interview with Paralegal 6, Tr. 1180-83 [hereinafter Paralegal 6 Interview] (stating that the light would be

green when the Paralegal Specialist was working); OIG IRF: Interview with Manager 3, Tr. 793-810 [hereinafter Manager 3
Interview]; Manager 4 Interview, supra, at Tr. 2930-39; Manager 4 Interview, supra, at Tr. 2930-44.
79 See, e.g., Paralegal 3 Interview, supra, at Tr. 1238-52 (stating that she did not believe she needed any further training education

to complete her tasks); Paralegal 1 Interview, supra, at Tr. 2116-19 (stating that he did not believe that he required any further
training or education to accomplish his tasks); Paralegal 2 Interview, supra, at Tr. 1876-79 (stating that she did not believe that
she needed any further training or education to accomplish her tasks better); OIG IRF: Interview with Paralegal 8, Tr. 999-1002
(stating that he did not feel that he did not have enough training or education to accomplish certain tasks) [hereinafter Paralegal
8 Interview]; Paralegal 9 Interview, supra, at Tr. 1526-30 (stating that she does not believe there are tasks she cannot do because
she does not have enough training or education).
80 Paralegal 7 Interview, supra, at Tr. 2198-246 (stating that she needed some more training on AIA because they only had

minimal training a few years ago); Paralegal 10 Interview, supra, at Tr. 1554-71 (stating that she learned AIA cases by doing them,
noting that the “training was very poor” and too long ago).
81 See, e.g., Paralegal 1 Interview, supra, at Tr. 2123-36, 2468-70 (“[W]e are capable of doing some more basic work than we’re

given.”). When there was discussion in 2011 with the Chief Judge about possibly creating an attorney position for the Paralegal
Specialists with law degrees to help with writing “simpler decisions” to get them out faster one Paralegal Specialist stated, “we
were so excited about that.” Paralegal 2 Interview, supra, at Tr. 2114-25.
82 OIG IRF: Review of Documents from Senior Manager 1 [hereinafter Senior Manager 1 Documents] (list noting which PTAB

employees had law degrees).




REPORT #13-1077                                                                                                                      13
     U.S. DEPARTMENT OF COMMERCE                                                       OFFICE OF INSPECTOR GENERAL


productive than the Paralegal Specialists without law degrees.83 Another key member of
management also stated that there was a gap in skill between the new Paralegal Specialists who
were attorneys and those without law degrees who had been at the PTAB for many years.84
He stated that the PTAB’s plan was “to close [the gap] through training.”85 More than one
manager noted that these new paralegals were “overqualified.”86

A few of the managers believed that some additional training was necessary for the Paralegal
Specialists, particularly training regarding the AIA cases because the prior AIA training occurred
too long ago.87 At the time of his interview, a Senior Manager stated that management was
currently training the Paralegal Specialists on AIA.88 Another Supervisory Paralegal Specialist
mentioned that the Paralegal Specialists could use a “refresher course in . . . English, and maybe
. . . bluebooking,” although they are “pretty good at it.”89

During the relevant time frame and afterwards, Paralegal Specialists have had a promotion
potential to GS-11, and, generally, the only position of advancement in the organization has
been the Supervisory Paralegal Specialist position.90 Numerous Paralegal Specialists and
Supervisory Paralegal Specialists told the OIG that adding more advanced positions or a GS-12
promotion potential would motivate Paralegal Specialists to work harder and to remain at the
PTAB longer.91 Additionally, at least one Paralegal Specialist informed the OIG that she looked
for a detail when she began to realize she had no opportunity to be promoted at the PTAB.92
When the PTAB started receiving AIA cases, a Senior Manager suggested creating a GS-12
position for Paralegal Specialists who worked on those cases because the work was
considerably more difficult and this way the managers could pick who was best able to do this
work.93 Management did not create this position.94


83 See [REDACTED]
84 [REDACTED]; see also [REDACTED] (the PTAB has a “very distributed range of paralegal talents and training, . . . it’s nearly
bimodal”).
85 OIG IRF: Interview with Senior Manager 6, Tr. 2428-30 [hereinafter Senior Manager 6 Interview].
86 Manager 1 Interview, supra, at Tr. 3859-82; Manager 3 Interview, supra, at Tr. 1536-41.
87 See, e.g., Manager 2 Interview, supra, at Tr. 2351-84 (stating that the supervisor’s Paralegal Specialists are capable to work on

their current tasks, but it would be helpful to have a standard of procedure for the AIA cases and some additional training).
88 Senior Manager 6 Interview, supra, at Tr. 2440-42; see also Senior Manager 2, supra, at Tr. 2773-74 (stating that some Paralegal

Specialists were trained the week before her interview).
89 Manager 1 Interview, supra, at Tr. 4161-69.
90 See Paralegal 5 Interview, supra, at Tr. 900-18; see also Paralegal 3 Interview, supra, at Tr. 1151-63 (stating that “there is no

higher position because after you’re a paralegal you’re a supervisor . . . . and that’s all it is” and if a Paralegal Specialist does not
have a science, technical, or engineering degree, he or she cannot become a patent attorney). A couple of Paralegal Specialists
have moved to other administrative positions, but not as part of the typical career ladder for Paralegal Specialists. See Paralegal
7 Interview, supra, at Tr. 2395-426.
91 See, e.g., Paralegal Interview 1, supra, at Tr. 2219-82; Paralegal 2 Interview, supra, at Tr. 648-58, 2369-97; Paralegal 3 Interview,

supra, at Tr. 1136-65; Paralegal 5 Interview, supra, at Tr. 867-921; Paralegal 7 Interview, supra, at Tr. 2356-97; Manager 2 Interview,
supra, at Tr. 2540-75; Senior Manager 1 Interview, supra, at Tr. 3380-493; see also Senior Manager 6 Interview, supra, at Tr. 2326-
2404 (stating that retaining talented paralegals at the GS-11 level is a concern and a challenge); Paralegal 1 Interview, supra, at Tr.
2227-34 (stating that there was interest in even “marginal advancement” opportunities); Manager 1 Interview, supra, at Tr. 3859-
908 (noting that the PTAB should create attorney positions for Paralegal Specialists to avoid losing “good people”). But see
Paralegal Interview 11, supra, at Tr. 2442-67 (expressing belief that specialized AIA positions at a higher grade level would not
motivate Paralegal Specialists to work harder).
92 Paralegal 2 Interview, supra, at Tr. 650-58.
93 Senior Manager 2 Interview, supra, at Tr. 2724-65.
94 Id. at Tr. 2724-45.




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U.S. DEPARTMENT OF COMMERCE                                                OFFICE OF INSPECTOR GENERAL


     C. Role of the Paralegal Specialist Union

During the time frame in question, all PTAB paralegals were covered by a collective bargaining
agreement (the Labor Agreement) between the USPTO and the National Treasury Employees
Union Chapter 243 (the Union).95 The Labor Agreement, which also covered other non-
managerial, “nonprofessional employees” of the USPTO,96 regulated a number of areas
pertaining to employment conditions. In making employment decisions, the following
provisions of the Labor Agreement would have been relevant.

         1. Part-time Employment, Furloughs, and Reductions-in-Force

Employees who were scheduled to work less than 80 hours per two-week pay period were
considered part-time.97 Employees could not have been involuntarily reassigned from a full-time
position to a part-time position unless the procedures governing reductions-in-force (RIFs) and
adverse actions were followed.98 Additionally, prior to commencing such procedures, the
USPTO must have first determined whether any employees would have voluntarily converted
to part-time employment.99 Furloughs of more than 30 calendar days were considered RIFs.100

The USPTO was required to notify the Union of any proposed RIF as far in advance as
possible.101 Prior to any RIF action, the Union must have been given the opportunity to
negotiate the impact and implementation of the RIF to the maximum extent permitted by
law.102 Additionally, the USPTO’s policy as stated in the Labor Agreement was to accomplish
reductions in workforce through non-RIF means, such as attrition, when possible.103

         2. Job Duties and Details

The Labor Agreement stated that the USPTO and the Union agreed with the principle of equal
pay for substantially equal work.104 Thus, if a review revealed that an employee was performing
higher-level duties and responsibilities than those entailed by the employee’s existing job
description, the employee was to be compensated for the highest level of work to the extent
permitted.105

The selection of employees for details, defined as temporary assignments of employees to
different positions or duties, were to be conducted fairly and equitably.106 Volunteers were to

95 See OIG IRF: Documents #2 from Senior Manager 1, Exs. 1, 5 at 6 [hereinafter Senior Manager 1 Documents #2] (includes
collective bargaining agreement between the USPTO and the National Treasury Employees Union Chapter 243, effective Sep.
29, 2003).
96 See id. at Ex. 5 at 6.
97 See id. at Ex. 5 at 25.
98 See id.
99 See id. at Ex. 5 at 73.
100 See id.
101 See id.
102 See id.
103 See id.
104 See id. at Ex. 5 at 67-68.
105 See id.
106 See id. at Ex. 5 at 71.




REPORT #13-1077                                                                                                            15
      U.S. DEPARTMENT OF COMMERCE                                                  OFFICE OF INSPECTOR GENERAL


be solicited, and if more employees than necessary volunteer, first consideration was to be
given to the most qualified senior employee who had volunteered.107 If there were too few
volunteers, first consideration was to be given to the most qualified junior employee.108

       D. Role of Supervisory Paralegal Specialists

Supervisory Paralegal Specialists were generally tasked with assigning, monitoring, and checking
the work of the paralegals, as well as acting as a “go-between in many cases between the
paralegals and the judges.”109 There were eight Supervisory Paralegal Specialists each year
between Fiscal Years 2009 and 2013.110 According to witnesses interviewed by the OIG, much
of their work was “tedious,” such as assigning and tracking the work assignments, which largely
consisted of data entry.111 One of the Supervisory Paralegal Specialists stated that she also
answered the AIA telephone line and completed spreadsheets with case details.112 One
managerial employee explained that the Supervisory Paralegal Specialists were “more lackeys
than they are anything else,” and the only authority they had was to assign work and rate their
Paralegal Specialists.113

According to one Supervisory Paralegal Specialist, the Supervisory Paralegal Specialists were
required to review 20 samples of each Paralegal Specialist’s work product per quarter, although
she did not have time to do so.114 Another Supervisory Paralegal Specialist stated to the OIG
that the Supervisory Paralegal Specialists were required to review six of the opinions that each
Paralegal Specialist had worked on each month.115 In reviewing work, if the supervisors found
errors, they informed the Paralegal Specialists to be cautious of those errors and made efforts
to remind those Paralegal Specialists in the future.116

A Senior Manager informed the OIG that, in the summer of 2013, Chief Judge 2 noticed errors
in AIA decisions; thus, management directed the Supervisory Paralegal Specialists to review
every AIA decision in their paralegals’ dockets.117 Some Supervisory Paralegal Specialists and


107 See id.
108 See id.
109 Senior Manager 1 Interview, supra, at Tr. 1130-45.
110 See OIG IRF: Data Analysis, supra.
111 Senior Manager 1 Interview, supra, at Tr. 1151-58.
112 Manager 1 Interview, supra, at Tr. 1031-37, 1087-97.
113 [REDACTED]; see also Manager 1 Interview, supra, at Tr. 3465-76 (agreeing that Supervisory Paralegal Specialists do not

create any work, they just pass along work). On occasion Supervisory Paralegal Specialists do work for judges. Manager 1
Interview, supra, at Tr. 4115-50. According to an employee, Supervisory Paralegal Specialists are not “privy to a lot of decisions
that are made at the Board,” and when they are asked for their opinions, and they give them, management has “already made
[its] mind up what [it is] going to do anyway, and it’s just a matter of formality that [it] even ask[s]” the Supervisory Paralegal
Specialists for their opinions. [REDACTED]; see also [REDACTED] (until the last year or two, Supervisory Paralegal Specialists
were not invited to meetings and asked for their input on changes management would be making even though they “are the
ones that know what’s going on”).
114 Manager 1 Interview, supra, at Tr. 1093-1108; see also Senior Manager 1 Interview, supra, at Tr. 1103-29 (Supervisory Paralegal

Specialists working for this manager were required to review 20 samples of each Paralegal Specialist’s work product per quarter
and four decisions per Paralegal Specialist per month).
115 Manager 2 Interview, supra, Tr. 508-13.
116 See Manager 1 Interview, supra, at Tr. 1119-24.
117 See Senior Manager 2 Interview, supra, at Tr. 1465-95; Senior Manager 1 Interview, supra, at Tr. 1064-97. The Supervisory

Paralegal Specialists did not begin reviewing every other decision, however. Id. at Tr. 1089-97.




16                                                                                                               REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL


Paralegal Specialists stated that, despite the Chief Judge’s perceptions, they did not notice
increased errors in opinions over time.118

Chief Judge 2 stated to the OIG that he had often instructed Senior Managers and “at least
some of the supervisory paralegals who reported to them” to “make sure [they] know what
[their] people are doing.”119 In particular, he stated that he instructed these managers to know
“who we have out there, what they’re doing, and . . . we know how they’re working and what
they’re producing.”120 However, according to the evidence reviewed in this investigation, the
managers of the Supervisory Paralegal Specialists did not seem to require the Supervisory
Paralegal Specialists to monitor their Paralegal Specialists’ status throughout each workday.121
None of the Supervisory Paralegal Specialists interviewed by the OIG stated that they were
directed to use the communicator to monitor their Paralegal Specialists, and several other
Supervisory Paralegal Specialists confirmed that they did not use the communicator to monitor
their Paralegal Specialists.122 In fact, evidence showed that they relied on their Paralegal
Specialists to inform them of times when they were not working.123

One Senior Manager also stated to the OIG that the Supervisory Paralegal Specialists would not
monitor Paralegal Specialists using the communicator tool; rather, the Supervisory Paralegal
Specialists would use that tool to determine whether Paralegal Specialists were available to
receive work assignments or if the Supervisory Paralegal Specialist needed to find a Paralegal
Specialist.124 One managing judge stated that in 2011 or 2012, the Paralegal Specialist Union
president was “very angry about the thought that [PTAB management] might dare to track
where [the paralegals] were” using the communicator system, and he believed that a Senior
Manager assured the Union president “that was not the purpose of the communicator.”125




118 A Senior Manager informed the OIG that he believed “it was over exaggerated sometimes when [the judges] were
complaining about errors.” OIG IRF: Interview with Senior Manager 4, Tr. 1202-22 [hereinafter Senior Manager 4 Interview]. A
Supervisory Paralegal Specialist reported that the supervisor’s team’s quality had increased. Manager 2 Interview, supra, at Tr.
661-69. Another also saw improvement with her team. Manager 1 Interview, supra, at Tr. 1492-96. Another Supervisory
Paralegal Specialist stated that although about one year ago, judges “complained that . . . that they thought there were too many
errors[,] . . . . [t]hat wasn’t [her] . . . experience.” Manager 4 Interview, supra, at Tr. 1051-54. A Paralegal Specialist who would
see other individuals’ decisions informed the OIG that she thought error stayed the same over the past few years. Paralegal
Specialist 2 Interview, supra, at Tr. 947-57.
119 Chief Judge 2 Interview, supra, at Tr. 989-1041.
120 Id. at Tr. 1012-30.
121 Senior Manager 2 Interview, supra, at Tr. 1204-40. In approximately 2010 or 2011, Senior Manager 2 directed a Supervisory

Paralegal Specialist to “[k]eep an eye” on specific Paralegal Specialists who were recording Other Time, despite having had
work assigned. Id.
122 See, e.g., Manager 2 Interview, supra, at Tr. 303-41, Manager 1 Interview, supra, at Tr. 578-84, 800-17; Manager 4 Interview,

supra, at Tr. 457-87. However, one Supervisory Paralegal Specialist stated that she monitors her paralegals using the
communicator “as much as she can.” Manager 3 Interview, supra, at Tr. 766-71.
123 See, e.g., Manager 2 Interview, supra, at Tr. 315-41. On the other hand, one Supervisory Paralegal Specialist stated that

because of her particularly workload, she had “[t]oo much work . . . for [her] to monitor their coming and going,” and because
they “normally” accomplished their work, she believed “there[ wa]s really no need for me to monitor them.” Manager 1
Interview, supra, at Tr. 800-817.
124 Senior Manager 1, supra, at Tr. 1367-81; see also Senior Manager 5 Interview, supra, Tr. 778-91 (stating that he did not suspect

that Supervisory Paralegal Specialists were using the communicator system to monitor when the Paralegal specialists were
working).
125 Managing Judge 1 Interview, supra, Tr. 632-45.




REPORT #13-1077                                                                                                                   17
      U.S. DEPARTMENT OF COMMERCE                                                  OFFICE OF INSPECTOR GENERAL


       E. Performance Evaluations and Performance-Based Bonuses

This section discusses performance appraisals and performance-based bonuses for Paralegal
Specialists and Supervisory Paralegal Specialists from Fiscal Year 2009 to Fiscal Year 2013.

          1. Paralegal Specialists

The Paralegal Specialists’ performance appraisal period ran from October 1 to September 30.126
Paralegals’ performance appraisals were formulaically determined primarily by how quickly and
accurately they completed tasks.127 These appraisals, known as production-based performance
appraisals plans (production-based PAPs)128 comprised the following four weighted elements:
quality (30%), productivity (30%), timeliness (20%), and customer service (20%).129 For each
element, a Paralegal Specialist received a rating between one and five – one being
“Unacceptable,” two being “Marginal,” three being “Fully Successful,” four being
“Commendable,” and five being “Outstanding.”130 The weight of each element was then
multiplied by the rating to reach a point score for that element; the sum of the scores was
added to reach a total performance appraisal score between one hundred and five hundred.131
A score of 460 to 500 was Outstanding.132 The corresponding one-digit total scores were
maintained by the USPTO in a five-point scale from 1 to 5, and these are the score that the
OIG used in its data analyses.133

The “quality” element was rated according to a Paralegal Specialist’s “error rate” with respect
to the work products produced by the Paralegal Specialist.134 The “productivity” element was
rated according to a “Production Goal Achievement” percentage defined as the number of
earned work units divided by the number of labor hours (production time) spent earning those
work units.135 The PAP included a list of tasks and the number of pre-defined work units for
each task.136 Production time did not include hours charged to Other Time or other non-
production time codes.137 The “timeliness” element was rated according to how quickly tasks


126 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 83.
127 See OIG IRF: Documents from Manager 4, Ex. 3 [hereinafter Manager 4 Documents].
128 See, e.g., Senior Manager 4 Interview, supra, at Tr. 1234-48; OIG IRF: Documents Received from Office of Human Resources,

USPTO, Ex. 4 at 3 [hereinafter OHR Documents].
129 See Manager 4 Documents, supra, at Ex. 3.
130 See id.
131 See id.
132 See id. If the score was between 100 and 199, then the Paralegal Specialist received an overall rating of Unacceptable; 200 to

289 was Marginal; 290 to 379 was Fully Successful; 380 to 459 was Commendable. Id.
133 OIG IRF: Data Analysis, supra.
134 See Manager 4 Documents, supra, at Ex. 3. The rate was based on a minimum of 20 work products sampled per quarter, with

an error charged against the Paralegal Specialist if “a reasonable management official could not have permitted the document to
leave the [PTAB] with such an error.” See id. An error rate of less than 2% resulted in an Outstanding rating for the quality
element; less than 3% but more than 2% resulted in Commendable; less than 4% but more than 3% resulted in Fully Successful;
less than 5% but more than 4% resulted in Marginal; and 5% or greater resulted in Unacceptable. See id.
135 See id. A rounded Production Goal Achievement percentage of 110% and above resulted in an Outstanding rating for the

production element; 105% to 109% resulted in Commendable; 95% to 104% resulted in Fully Successful; 90% to 95% resulted in
Marginal; and below 90% resulted in Unacceptable. See id.
136 See id. For example, preparing a decision yielded three work units, and mailing a decision yielded one-half of a work unit.

See id.
137 See id.




18                                                                                                              REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


were completed after being assigned.138 Finally, the “customer service” element was rated
“based on direct observation and input/discussion with customers, stakeholders, and/or
peers.”139

Paralegal Specialists self-reported their production time and, according to several witnesses
interviewed by the OIG, some realized that they could “game the system” by under-reporting
their production time140 or by intentionally working when a supervisor was not available to
provide assignments.141 For example, if the Outstanding-level target time for an assignment was
two hours and a Paralegal Specialist took four hours to complete the assignment, the Paralegal
Specialist could report that he or she finished the assignment in only two hours, thereby
inflating his or her productivity statistic.142 Also, if a Paralegal Specialist’s supervisor worked
Monday through Thursday from 6:00 AM to 4:00 PM, the Paralegal Specialist could have
decided to work Wednesday through Saturday from 12:00 PM to 10:00 PM so that he or she
was not present when the supervisor had work to distribute.143 By manipulating the assignment
system in this manner, Paralegal Specialists could avoid work, while causing no change in their
productivity statistics.144 Other issues relating to flexible scheduling are discussed in the
“Flexible Work Schedules and Telework Programs” section of this report.

The USPTO and Union entered into agreements each year to specify the amount of
performance-based bonuses for certain Union employees, including PTAB Paralegal
Specialists.145 During the time period relevant to the OIG’s investigation, bonuses were a
percentage of salary, generally 1% for a Fully Successful overall performance rating, 3% for a
Commendable rating, and 5% for an Outstanding rating.146 To be eligible for a full performance
award, the Labor Agreement and yearly bonus agreements stated that employees “must have
worked in their job functions[,] including mandatory job-related training and job-related non-
production hours,” for at least 1,250 hours during the appraisal period.147 Employees who
worked less than 1,250 hours but more than 600 in their job functions were eligible for a pro-


138 See id. Each type of task was assigned a pre-determined baseline; for example, the baseline for preparing a decision was 1.5
days. Id. On a case-by-case basis, PTAB management had the discretion to award a greater number of work units for
particularly time-consuming assignments. See id. Achieving a 1.5-day average turnaround for preparing decisions resulted in a
Fully Successful sub-rating for that task type; an average of one day resulted in Commendable; an average of half a day resulted
in Outstanding; an average of two days resulted in Marginal; and an average greater than two days resulted in Unacceptable.
See id. The sub-ratings for each type task were averaged to yield the overall rating for the timeliness element. See id.
139 See id. Paralegal Specialists were expected to routinely respond to customer requests with factually accurate information

and consistent with PTAB and USPTO policies. See id. Additionally, Paralegal Specialists’ work product was expected to
“reflect thorough research and consideration of customer issues and concerns.” See id. Paralegal Specialists were also
expected to routinely respond to inquiries on the same day received or by the established deadline; respond to customers in a
clear and courteous manner that directly addresses issues and questions; routinely exhibit a willingness to work with customers
to resolve issues; and activate out-of-office e-mail and phone notifications when on approved absences. See id.
140 See, e.g., id.; Senior Manager 4 Interview, supra, at Tr. 1262-1419.
141 See, e.g., Paralegal 5 Interview, supra, at Tr. 1028-48.
142 See, e.g., Manager 4 Documents, supra, at Ex. 3; Manager 4 Interview, supra, at Tr. 1262-1419.
143 See, e.g., Paralegal 5 Interview, supra, at Tr. 1028-48.
144 See, e.g., id.
145 See OIG IRF: Documents from Senior Manager 2, Ex. 3, [hereinafter Senior Manager 2 Documents]; OHR Documents, supra,

at Exs. 6, 104.
146 See Senior Manager 2 Documents, supra, at Ex. 3; OHR Documents, supra, at Ex. 6.
147 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 92; see also Senior Manager 2 Documents, supra, at Ex. 3; OHR

Documents, supra, at Ex. 6.




REPORT #13-1077                                                                                                               19
      U.S. DEPARTMENT OF COMMERCE                                                 OFFICE OF INSPECTOR GENERAL


rated bonus.148 Employees who worked less than 600 hours in their job functions were not
eligible for an award.149

The Labor Agreement stated that USPTO “will not prescribe nor permit a predetermined
distribution of ratings.” 150 It also stated that the Paralegal Specialists had “no entitlement to a
performance award or other type of incentive award,” and “[a]ll awards [we]re subject to
budgetary limitations and [we]re paid at the discretion of the [USPTO].”151 All relevant
supplementary agreements noted that all applicable Labor Agreement provisions applied,
including the provision on budgetary limitations.152

The PTAB’s Administrative Officer calculated the performance bonus for each Paralegal
Specialist.153 The Chief Judge gave the final approval for all employees.154 As discussed below,
Paralegal Specialists received a total of $561,195.91 in bonuses from Fiscal Year 2009 to Fiscal
Year 2013.

          2. Supervisory Paralegal Specialists

The performance appraisal for Supervisory Paralegal Specialists was based on non-formulaic
criteria and consisted of the following five weighted elements: supervision (25%), supporting the
mission of the PTAB (20%), team quality (20%), team timeliness (20%), and team customer
service (15%).155 For each element and for the overall rating, the supervisors could be
appraised as Unacceptable, Marginal, Fully Successful, Commendable, or Outstanding.156 The
ratings were determined by the supervisors’ manager and approved by the Support
Administrator.157 Bonus amounts were determined by the Senior Manager and the Support
Administrator, but there was a general understanding that for non-Union employees such as
Supervisory Paralegal Specialists, bonuses would be a percentage of salary based on the
performance rating: none for Fully Successful, 2% for Commendable, and 4% for Outstanding.158
These bonus amounts, however, were flexible and not fixed.159 The Chief Judge gave the final
approval for these bonuses.160 As discussed below, Supervisory Paralegal Specialists received a
total of $120,523.55 in bonuses from Fiscal Year 2009 to Fiscal Year 2013.




148 See Senior Manager 2 Documents, supra, at Ex. 3; OHR Documents, supra, at Ex. 6; see also Senior Manager 1 Documents #2,
supra, at Ex. 5 at 92.
149 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 92.
150 See id. at Ex. 5 at 87.
151 See id. at Ex. 5 at 92.
152 See Senior Manager 2 Documents, supra, at Ex. 3; OHR Documents, supra, at Ex. 6.
153 See Senior Manager 5 Interview, supra, at Tr. 2577-90; Senior Manager 4 Interview, supra, at Tr. 2211-52.
154 See Senior Manager 4 Interview, supra, at Tr. 2244-50; Managing Judge 1 Interview, supra, at Tr. 2916-57.
155 See Senior Manager 1 Documents, supra, at Ex. 3; Senior Manager 1 Interview, supra, at Tr. 1406-15.
156 See Senior Manager 1 Documents, supra, at Ex. 3; Senior Manager 4 Interview, supra, at Tr. 2333-40.
157 See Senior Manager 5 Interview, supra, at Tr. 2603-38, 2566-75.
158 See id. at Tr. 2603-38.
159 See id.
160 See Senior Manager 4 Interview, supra, at Tr. 2244-50; Managing Judge 1 Interview, supra, at Tr. 2916-18.




20                                                                                                             REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


      F. Flexible Work Schedules and Telework Programs

Three work programs have been available to PTAB Paralegal Specialists and Supervisory
Paralegal Specialists during the relevant time frame and afterwards: flexible work schedules
under the USPTO’s “Increased Flexitime Policy,” telework arrangements under the “Hoteling
Program,” and enhanced hoteling flexibility under the “50 Mile Radius Agreement” option. The
vast majority of Paralegal Specialists and Supervisory Paralegal Specialists participated in all
three programs once eligible.161 The combined effect of the three programs afforded extensive
flexibility in scheduling and teleworking. Managing Judge 1 stated that by the end of the time
frame relevant to the OIG investigation, 95% of all Paralegal Specialists were full-time hotelers,
and only two to three worked in the office regularly.162

         1. Flexible Work Schedules – “Increased Flexitime Policy”

The “Increased Flexitime Policy” (IFP) offers a flexible work schedule to full-time USPTO
employees, including PTAB Paralegal Specialists and Supervisory Paralegal Specialists.163 The IFP
allows employees to complete their 80-hour bi-weekly work requirement by working as few as
four days per week – either four weekdays, or three weekdays and a Saturday.164 Employees
can work between 5:30 AM and 10:00 PM, but must work during “core hours” – hours
designated by a federal agency, as required by law, when all flexible schedule employees are
required to work.165 The USPTO has one core hour: between 1:00 PM to 2:00 PM each
Tuesday.166

Employees can work a maximum of 12 hours per day, excluding the required unpaid 30-minute
meal break.167 Hours worked on a particular day do not need to be worked continuously;
employees may clock-in and clock-out during the day.168 Time is to be reported in 15-minute
increments, and employees are responsible for keeping track of their own time.169 Additionally,
employees who will be absent on a weekday must notify their supervisors in advance and leave
out-of-office notifications on their e-mail and phone accounts, “as appropriate.”170


161 See, e.g., Chief Judge 2 Interview, supra, at Tr. 1059-82; USPTO Response, supra, at Ex. 8.
162 USPTO Response, supra, at Ex. 8.
163 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 151; OIG IRF: Documents from Manager 3 (Increased Flexitime Policy

document), 1 [hereinafter Manager 3 Documents].
164 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 151-52; Manager 3 Documents, supra, at 1 (Increased Flexitime Policy

document).
165 See 5 U.S.C. § 6122; Manager 3 Documents, supra, at 1 (Increased Flexitime Policy document).
166 See Documents from Manager 3, supra, at 1 (Increased Flexitime Policy document). Core hours for “POPA [Patent Office

Professional Association] bargaining unit members” were 1:00 PM to 2:00 PM each Thursday. See id. If an employee works
from home for at least six hours on a weekday, then the employee must work six of those hours between 6:30 AM and 7:00
PM. OHR Documents, supra, at Ex. 4 at 12; Senior Manager 1 Documents #2, supra, at Ex. 4 at 12. If an employee works from
home for less than six hours on a weekday, then the employee must work all of these hours between 6:30 AM and 7:00 PM. Id.
167 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 151,153; Documents from Manager 3, supra, at 1, 4 (Increased Flexitime

Policy document).
168 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 151; Documents from Manager 3, supra, at 1 (Increased Flexitime Policy

document).
169 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 151; Documents from Manager 3, supra, at 3 (Increased Flexitime Policy

document).
170 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152-53; Documents from Manager 3, supra, at 3 (Increased Flexitime

Policy document).




REPORT #13-1077                                                                                                              21
      U.S. DEPARTMENT OF COMMERCE                                                  OFFICE OF INSPECTOR GENERAL


The IFP is subject to restrictions.171 Employees must “coordinate their work schedules to
ensure that necessary office coverage is maintained.”172 In addition, IFP rules state that
“employees may be required to be present at work at specific times to attend to specific events
such as meetings, projects, and training.”173 In such cases, the USPTO will give reasonable
advance notice, and employees will be expected to adjust their schedules accordingly.174
Furthermore, “[m]odifications may be required to ensure internal and external customer needs
are met.”175 Participation in the IFP is voluntary and contingent upon a “Fully Successful”
performance rating.176 Some employees, such as those whose presence is required during
normal business hours, may not be eligible to participate in the IFP.177

In practice, evidence showed that the IFP had occasionally hindered Paralegal Specialists’
productivity.178 Because Paralegal Specialists received assignments only when their supervisors
were working, Paralegal Specialists with differing work schedules from their supervisors’
schedules sometimes had more downtime and received fewer assignments.179 As stated by one
Paralegal Specialist, “[A Paralegal Specialist] cannot make [a] supervisor[y] paralegal wake up
[early] in the morning to assign [the Paralegal Specialist] a case. That [has] got to be the most
screwed up system I've ever heard of. If I arrive at work [early in the morning] and my
supervisor [does not arrive] until [late in the morning], what are you to do? . . . . You can’t
change my schedule.”180 Also, as discussed previously, if a Paralegal Specialist’s supervisor
worked Monday through Thursday from 6:00 AM to 4:00 PM, the Paralegal Specialist could
have decided to work Wednesday through Saturday from 12:00 PM to 10:00 PM so that he or
she was not present when the supervisor had work to distribute.181 Additionally, as a PTAB
Senior Manager informed a Supervisory Paralegal Specialist, “if the employee does not notify
you that they are out of work and chooses to work on the weekend even if work is not
assigned, there isn’t much we can do about that.”182


171 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152; Documents from Manager 3, supra, at 3 (Increased Flexitime Policy
document).
172 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152; Documents from Manager 3, supra, at 3 (Increased Flexitime Policy

document).
173 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152; Documents from Manager 3, supra, at 3 (Increased Flexitime Policy

document).
174 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152; Documents from Manager 3, supra, at 3 (Increased Flexitime Policy

document).
175 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152.
176 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152-53; Documents from Manager 3, supra, at 2 (Increased Flexitime

Policy document).
177 See Senior Manager 1 Documents #2, supra, at Ex. 5 at 152-53; Documents from Manager 3, supra, at 2 (Increased Flexitime

Policy document).
178 See OIG IRF: Interview of Paralegal 11, Tr. 2932-58 [hereinafter Paralegal 11 Interview].
179 See id.
180 [REDACTED]
181 See, e.g., Paralegal 5 Interview, supra, at Tr. 415-36.
182 See OIG IRF: Review of Documents from Senior Manager 5 [hereinafter OIG IRF: SM Documents] (e-mail from Senior

Manager 5 dated July 30, 2012, with the subject line “RE: Working on a Saturday… general question”). Furthermore, on a few
occasions, the high degree of scheduling flexibility caused the PTAB to pay overtime to Paralegal Specialists on days when the
Paralegal Specialists logged Other Time. See OIG IRF: Data Analysis; OIG IRF: Interview of Paralegal 12, Tr. 306-27, 652-78,
1426-68, 1843-46. This could occur, for example, if a paralegal received little to no assignments during his regular hours of 6:00
AM to 2:30 PM, causing him to log Other Time, and then at 2:35 PM, received a new assignment – because the manager
required all assignments to be completed the same day they are given, the employee was required to work overtime to
complete the assignment. See id.




22                                                                                                              REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


         2. Telework Arrangements – The PTAB “Hoteling Program”

The PTAB “Hoteling Program” is available to Paralegal Specialists and Supervisory Paralegal
Specialists and allows employees to perform the majority of their work from home
(telework).183 During the time frame in question, the hoteling program was governed by a set
of agreements between the Union and the PTAB (Telework Agreements).184 The provisions
relevant to this investigation are nearly identical between the agreements. Under the program,
employees are generally required to work at PTAB offices only two days per two-week pay
period.185 Employees became eligible for the program after spending at least two years in their
current position.186 Participation is voluntary and contingent on maintaining a “Fully Successful”
performance rating.187 Prior to participating in the program, employees must complete a
certification and training process.188 Management is permitted to suspend or terminate an
employee’s participation in the program based on business needs or the employee’s
performance or conduct.189 Additionally, management reserves the right to terminate the
program as a whole at any time due to operational needs.190

Employees who participate in the Hoteling Program are expected to be accessible and available
during work hours.191 As such, they are required to use online collaboration tools and check
and respond appropriately to voicemail and e-mail periodically throughout the workday.192
Furthermore, employees “must work on tasks directly related to their job functions as defined
in their performance appraisal plan . . . or on other tasks specifically assigned and/or approved
by their supervisors.”193 Additionally, employees “must ensure that personal responsibilities do
not interfere with [the] performance of official duties.”194

Pursuant to the Telework Agreements, employees are required to provide their supervisors
with their work schedules and advance notification of any schedule changes.195 The Telework

183 See OHR Documents, supra, at Ex. 3-4; Senior Manager 1 Documents #2, supra, at Ex. 2 at 7, and Ex. 4. See also Senior Manager
2 Documents, supra, at Ex. 2.
184 See Senior Manager 1 Documents #2, supra, at Ex. 4 (pilot hoteling agreement signed in January 2009); Senior Manager 2

Documents, supra, at Ex. 2 (amended pilot hoteling agreement signed in March 2009); OHR Documents, supra, at Ex. 4 (hoteling
agreement signed in August 2010); see also OHR Documents, supra, at Ex. 3 (modifying the hoteling agreement’s requirement to
work at USPTO offices once per week to twice per two-week pay period), Ex. 5 (affording hoteling participants the option to
change their official duty station to their home address, thereby eliminating the requirement to work at USPTO offices twice
per two-week pay period); Senior Manager 1 Documents #2, supra, at Ex. 4 (affording Supervisory Paralegal Specialists the option
to participate in the hoteling program). A pilot version of the agreement was signed in January 2009 and amended in March
2009. Id. at Ex. 4; Senior Manager 2 Documents, supra, at Ex. 2. Subsequently, a final, non-pilot agreement was signed in August
2010. OHR Documents, supra, at Ex. 4. The provisions relevant to this investigation are nearly identical in all versions of these
agreements. See Senior Manager 1 Documents #2, supra, at Ex. 4; Senior Manager 2 Documents, supra, at Ex. 2; OHR Documents,
supra, at Ex. 4.
185 See OHR Documents, supra, at Ex. 3.
186 See id. at Ex. 4 at 3; Senior Manager 1 Documents #2, supra, at Ex. 4 at 3.
187 See OHR Documents, supra, at Ex. 4 at 3; Senior Manager 1 Documents #2, supra, at Ex. 4 at 3.
188 See Senior Manager 4 Interview, supra, at Tr. 386-434; OHR Documents, supra, at Ex. 4 at 11; Senior Manager 1 Documents #2,

supra, at Ex. 4 at 11; Managing Judge 1 Interview, supra, at Tr. 431-64; Chief Judge 2 Interview, supra, at Tr. 698-713.
189 See OHR Documents, supra, at Ex. 4 at 5; Senior Manager 1 Documents #2, supra, at Ex. 4 at 5.
190 See OHR Documents, supra, at Ex. 4 at 1; Senior Manager 1 Documents #2, supra, at Ex. 4 at 1.
191 See OHR Documents, supra, at Ex. 4 at 2, 5; Senior Manager 1 Documents #2, supra, at Ex. 4 at 2, 4.
192 See OHR Documents, supra, at Ex. 4 at 2, 5; Senior Manager 1 Documents #2, supra, at Ex. 4 at 2, 4.
193 See OHR Documents, supra, at Ex. 4 at 10; Senior Manager 1 Documents #2, supra, at Ex. 4 at 10.
194 See OHR Documents, supra, at Ex. 4 at 10; Senior Manager 1 Documents #2, supra, at Ex. 4 at 11.
195 See OHR Documents, supra, at Ex. 4 at 11; Senior Manager 1 Documents #2, supra, at Ex. 4 at 11.




REPORT #13-1077                                                                                                                23
      U.S. DEPARTMENT OF COMMERCE                                               OFFICE OF INSPECTOR GENERAL


Agreements further state that employees who do not work a set schedule each week must, for
each day worked, notify their supervisor when they will start work and how many hours they
intend to work that day.196 For work events that require physical attendance at PTAB offices,
such as meetings, lectures, and training, employees will generally be given advance notice of at
least two business days.197 Employees must adjust their schedules to attend these events.198

The Hoteling Program was initially a pilot program formed by an agreement between the PTAB
and the Union. The first telework agreement was executed in January 2009 with Chief Judge 1
being the PTAB’s primary signatory.199 PTAB employees who episodically teleworked also had
to take a training class before they could telework.200

          3. Enhanced Hoteling Flexibility – “50 Mile Radius Agreement” Option

The “50 Mile Radius Agreement” is another telework agreement with the Union that provides
enhanced flexibility to employees that participate in the PTAB’s Hoteling Program.201 Under
the agreement, hoteling employees may voluntarily change their official government duty station
to their home address.202 Participating employees acknowledge that the “option is primarily for
[their] convenience and benefit.”203 The option is approved for all employees who meet the
requirements of the Hoteling Program and reside within 50 miles of the USPTO headquarters
in Alexandria, Virginia.204 Employees who participate in the option are no longer required to
report to PTAB offices twice per two-week pay period.205 However, employees are still
“required to report to [PTAB offices] to meet all program and performance plan requirements,
to attend training, to attend meetings, . . . and as otherwise required by the [PTAB].”206

          4. Chief Judge 2’s Perceptions of the Telework Programs207

Chief Judge 2 told the OIG that, when he became the PTAB’s Chief Judge in May 2011, he was
“surprised to learn that the [PTAB] actually is in a circumstance where 90% of the paralegals
telework.”208 Describing this as “a shock,” Chief Judge 2 stated,

                   I’ve never worked at a place where some particular group of
                   employees having a function vital to the success of an organization
                   have as many as 90% of the people teleworking. I was shocked
                   because I was unaccustomed to seeing anything like that. I was


196 See OHR Documents, supra, at Ex. 4 at 11-12; Senior Manager 1 Documents #2, supra, at Ex. 4 at 12.
197 See OHR Documents, supra, at Ex. 4 at 5, 11; Senior Manager 1 Documents #2, supra, at Ex. 4 at 5, 11.
198 See OHR Documents, supra, at Ex. 4 at 11; Senior Manager 1 Documents #2, supra, at Ex. 4 at 11.
199 See Senior Manager 1 Documents #2, supra, at Ex. 4 at 15.
200 See Senior Manager 4 Interview, supra, at Tr. 386-434.
201 See OHR Documents, supra, at Ex. 5.
202 See id. at Ex. 5 at 1.
203 See id.
204 See id. at Ex. 5 at 2.
205 See id.
206 See id.
207 The OIG requested to speak with Former Chief Judge 2 about the PTAB, but Former Chief Judge 2 declined the request.

Because he is no longer a federal employee, the OIG cannot require him to provide a statement or participate in an interview.
208 See Chief Judge 2 Interview, supra, at Tr. 970-78.




24                                                                                                           REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                       OFFICE OF INSPECTOR GENERAL


                    also somewhat shocked because I wasn’t quite sure . . . how that
                    kind of arrangement necessarily facilitated the specific work of
                    [the PTAB], which has a fundamental component of
                    interactivity.209

Chief Judge 2 told the OIG that he therefore doubted whether telework was effective for the
PTAB.210 According to Chief Judge 2, some of his Senior Managers, who did not telework and
who were physically present at PTAB offices, exhibited a lack of responsiveness and “diligence,”
which aggravated his concerns.211 He stated that he questioned whether his ability to manage
was “further disabled” because “because most people aren’t even here.”212

Chief Judge 2 inquired a number of times, including when he first joined the PTAB as Chief
Judge, with PTAB managers and possibly USPTO managers about ending the telework
programs.213 However, in response to his inquiries, he was told that the telework programs
could not be ended, and attempts to do so would face a “huge obstacle” with the Union and
with having sufficient office space for the employees.214 Realizing his “inability to change” the
telework programs, Chief Judge 2 tried to increase the number of times Paralegal Specialists
had to be physically present at PTAB offices to account for what they were doing.215 According
to Chief Judge 2, his efforts achieved “limited success.”216 When interviewed by the OIG, Chief
Judge 2 stated that he has “far less” concerns now than he had in 2011 and 2012, largely due to
a change in PTAB management, especially with respect to who oversees PTAB paralegals.217

          5. Paralegal Specialists’ and Supervisory Paralegal Specialists’ Understanding of
             the Relevant Telework Policies

The OIG’s interviews with relevant witnesses revealed that Paralegal Specialists had a limited
understanding of the rules governing the types of activities they could pursue while teleworking.
Some described rules about when they could work each day218 and how to handle technical
problems.219 Few noted that that they were not permitted to use the equipment for “personal
use,”220 and only one stated that they were not permitted to pursue personal activities such as
209 Id. at Tr. 978-82, 1068-72.
210 See id. at Tr. 1202-05.
211 See id. at Tr. 1153-57, 1177-213.
212 See id. at Tr. 1194-213.
213 See id. at Tr. 978-82, 1068-82, 1303-13, 2817-33.
214 See id. at Tr. 984-87, 1269-313, 2817-33.
215 See id. at Tr. 989-97.
216 See id. at Tr. 993-1010.
217 See id. at Tr. 1168-73, 1215-61.
218 Some Paralegal Specialists only responded that they were required to work 80 hours over two weeks and could not work

outside of the hours of 5:30 am and 10:00 pm. See, e.g., Paralegal 6 Interview, supra, Tr. 406-20; Paralegal 2 Interview, supra, at Tr.
313-62 (noting the maxiflex schedule, but not any specific telework rules when asked what Paralegal Specialists could and could
not do while teleworking); Paralegal 10 Interview, supra, at Tr. 194-96, 254-63 (explaining that Paralegal Specialists are supposed
to “adher[e] to [their] hours” pursuant to their flex schedule; providing times they can work each day). However, one
Paralegal Specialist stated to the OIG that there were not any rules that discuss what Paralegal Specialists could “do in [their]
home[s] while [they were] on government time.” Paralegal 6 Interview, supra, at Tr. 406-28.
219 They were required to come in to the office or take annual leave if they had technical problems. See Paralegal 3 Interview,

supra, at Tr. 349-55. But see Paralegal 9 Interview, supra, at Tr. 1084-88 (stating that if one’s computer is not working, there is
not a rule requiring one to take leave or go into the office to work).
220 See, e.g., Paralegal 6 Interview, supra, at Tr. 421-23; Paralegal 10 Interview, supra, at Tr. 192-94.




REPORT #13-1077                                                                                                                      25
      U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL


laundry and running errands while teleworking on government time.221 Similarly, in interviews
with the OIG, few Supervisory Paralegal Specialists testified that Paralegal Specialists must work,
not pursue personal activities, while hoteling on government time.222 After discussing the fact
that some Paralegal Specialists watched television, did laundry, and conducted other personal
activities while hoteling, Supervisory Paralegal Specialists stated that such activities were not
permitted while teleworking and Paralegal Specialists had no reason to think that such activities
were permissible.223

       G. Fiscal Year 2009 Hiring Plan and Execution

In September 2008, Chief Judge 1 and Managing Judge 1 planned to concurrently hire new
judges, patent attorneys, and Paralegal Specialists during the upcoming fiscal year to deal with
the PTAB’s growing backlog of cases.224 In their request to the USPTO for hiring authorization,
they specifically noted that the organization needed new Paralegal Specialists to support the
new judges and attorneys.225 Subsequently, the USPTO granted the authorization to hire 19
Paralegal Specialists, 10 judges, and 22 patent attorneys.226

The evidence showed that Chief Judge 1 became aware of an impending USPTO-wide hiring
freeze and was concerned that he would not be able to hire any new personnel for the
foreseeable future.227 According to two Senior Managers, Chief Judge 1 wanted to hire as many
employees as he could before the hiring freeze took effect.228 The Senior Managers therefore


221 Paralegal 3 Interview, supra, at Tr. 328-36; see also Paralegal 9 Interview, supra, at Tr. 396-07 (stating that Paralegal Specialists
were “basically supposed to act like [they were] in the office. [They were] supposed to not be distracted by other things going
on in [their] home[s] . . . be that laundry or [their] kid[s] or TV, any of the above”); Paralegal 10 Interview, supra, at Tr. 187-96
(stating that Paralegal Specialists were not supposed to do “tasks for home when you’re at work”).
222 See, e.g., Senior Manager 2 Interview, supra, at Tr. 280-89 (stating hours and days Paralegal Specialists can work), 576-80

(noting that Paralegal Specialists were not permitted to watch television and should be working); Manager 3 Interview, supra, at
Tr. 623-69 (stating that if Paralegal Specialists have an equipment problem, they have to go into the office or use leave);
Manager 1 Interview, supra, at Tr. 622-799 (stating that Paralegal Specialists cannot watch kids while teleworking, can only work
from their remote station, have to call in by 10:00 am if they are not teleworking); Manager 4 Interview, supra, at Tr. 384-92,
431-36 (stating that if Paralegal Specialists have computer problems, they have to report that and if it will last a long time, come
in to the office; explaining the hours within which each Paralegal Specialist can work each day). More than one Supervisory
Paralegal Specialist also stated that her Paralegal Specialists were required to notify her of their work schedules. See, e.g.,
Manager 3 Interview, supra, at Tr. 629-43; Manager 4 Interview, supra, at Tr. 347-51.
223 See also Manager 3 Interview, supra, at Tr. 2320-402 (stating that she had no indication that her Paralegal Specialists did not

understand that they were not allowed to go shopping on government time); Manager 2 Interview, supra, at Tr. 1952-77 (stating
that his Paralegal Specialists would have had no reason to think they could read books or do laundry while logging Other Time
and were not permitted to do so); Manager 1 Interview, supra, at Tr. 3622-23, 3648-57 (stating that although Paralegal Specialists
probably read books and watched television while logging Other Time, there was “no reason for them to think” reading a book
was allowed while logging Other Time, but also stated that they were never told they could not watch television).
224 See Managing Judge 1 Documents #1, supra, at Ex. 2; Senior Manager 4 Interview, supra, at Tr. 783-89; Managing Judge 1

Interview, supra, at Tr. 1365-69, 1501-05, 1796-1810.
225 See Managing Judge 1 Documents #1, supra, at Ex. 2, at 6.
226 See id. at Exs. 2, 18; USPTO Response, supra, at Ex. 3, 7; Senior Manager 5 Interview, supra, at Tr. 1055-1135; Senior Manager 1

Interview, supra, at Tr. 1529-42; Managing Judge 1 Documents #2, supra (e-mail from Senior Manager 5 on February 19, 2009).
Note that the PTAB does not directly hire judges; rather, after receiving funding authorization from the USPTO, the PTAB
selects judges it deems qualified for the position, and then submits their names to the Secretary of the U.S. Department
Commerce for appointment. See Chief Judge 2 Interview, supra, at Tr. 391-401.
227 See USPTO Response, supra, at Ex. 3; Managing Judge 1 Interview, supra, at Tr. 1796-1806, 1826-1903; OIG IRF: Review I of

Electronic Documents Received from USPTO, Exs. 8, 12.
228 See Senior Manager 5 Interview, supra, at Tr. 1055-1135; Senior Manager 4 Interview, supra, at Tr. 896-908.




26                                                                                                                    REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL


coordinated the hiring initiative for the 19 Paralegal Specialist positions.229 The hiring initiative
proceeded quickly, and 17 candidates were deemed suitable and selected for employment.230
The evidence showed, however, that Chief Judge 1 wanted to hire as many Paralegal Specialists
as possible and forced the hiring of two additional Paralegal Specialists over strenuous
objections from Senior Managers, including the hiring official, about the qualifications of the two
additional candidates.231 One Senior Manager stated to the OIG that he even “begged” Chief
Judge 1 not to hire the two additional candidates.232 Ultimately, however, all 19 candidates
were hired in Fiscal Year 2009.233

The impending hiring freeze subsequently took effect.234 One new judge had been hired by that
point.235 Several PTAB’s managers told the OIG that the judges had not been hired due to
judge hiring procedures, which are more complex and lengthy than Paralegal Specialist hiring
procedures.236 Chief Judge 1 and Managing Judge 1 submitted requests for exceptions to the
hiring freeze, detailing the PTAB’s case backlog and the amount of lost revenue from not having
more judges on staff.237 The exception requests, however, were not granted.238

After Chief Judge 1’s departure, Managing Judge 1 continued attempts at hiring more judges.239
Managing Judge 1 interviewed candidates and submitted selection packages via the Director of
the USPTO to the Secretary of Commerce, who must approve the hiring of judges.240 These
attempts, however, were unsuccessful. 241 Although a few full-time line-level judges were hired
between January 2009 and November 2011, they were all backfills for departed judges, and
significant hiring of new judges did not occur until the end of 2011.242



229 See Managing Judge 1 Documents #1, supra, at Ex. 2, p. 6, and Ex. 18; USPTO Response, supra, at Ex. 3, 7; Senior Manager 5
Interview, supra, at Tr. 1055-1135; Senior Manager 1 Interview, supra, at Tr. 1529-42.
230 See Managing Judge 1 Documents #1, supra, at Ex. 18; Senior Manager 1 Interview, supra, at Tr. 1533-42.
231 See Senior Manager 5 Interview, supra, at Tr. 1055-1113; Senior Manager 4 Interview, supra, at Tr. 851-93, 1018-40; Senior

Manager 1 Interview, supra, at Tr. 1529-62, 1605-63, 3811-43; Managing Judge 1 Interview, supra, at Tr. 1858-1903.
232 [REDACTED]
233 See USPTO Response, supra, at Ex. 3, 9; Senior Manager 4 Interview, supra, at Tr. 791-816.
234 See USPTO Response, supra, at Ex. 3; Senior Manager 5 Interview, supra, at Tr. 1895-1904, 2013-19; Senior Manager 4 Interview,

supra, at Tr. 791-816; Senior Manager 1 Interview, supra, at Tr. 664-68; Managing Judge 1 Interview, supra, at Tr. 1970-78.
235 See USPTO Response, supra, at Ex. 3; Senior Manager 5 Interview, supra, at Tr. 1895-1904, 2013-19; Senior Manager 4 Interview,

supra, at Tr. 791-816; Senior Manager 1 Interview, supra, at Tr. 664-68; Managing Judge 1 Interview, supra, at Tr. 1970-78.
236 See USPTO Response, supra, at Ex. 3; Senior Manager 4 Interview, supra, at Tr. 791-816; Managing Judge 1 Interview, supra, at Tr.

1804-17.
237 See Managing Judge 1 Documents #1, supra, at Ex. 1, 9, 11-12; Managing Judge 1 Interview, supra, at Tr. 1501-05.
238 See Managing Judge 1 Documents #1, supra, at Ex. 11, 14; USPTO Response, supra, at Ex. 3, 7; Managing Judge 1 Interview, supra,

at Tr. 1370-82, 1501-37, 1818-23; Chief Judge 2 Interview, supra, at Tr. 284-360; Managing Judge 1 Documents #2, supra (e-mail to
Senior Manager 5, among others).
239 See Managing Judge 1 Documents #1, supra, at Ex. 1, 5-8, 11, 13-15, 17-18; Managing Judge 1 Interview, supra, at Tr. 1970-78;

Chief Judge 2 Interview, supra, at Tr. 284-334.
240 Administrative patent judges are appointed by the Secretary of Commerce in consultation with the Director of the USPTO.

See Managing Judge 1 Documents #1, supra, at Ex. 8, 13-15; USPTO Response, supra, at Ex. 3; Managing Judge 1 Interview, supra, at
Tr. 1812-17.
241 See Managing Judge 1 Documents #1, supra, at Ex. 11, 14; USPTO Response, supra, at Ex. 3, 7; Managing Judge 1 Interview, supra,

at Tr. 1370-82, 1501-37, 1818-23; Chief Judge 2 Interview, supra, at Tr. 284-360.
242 See Managing Judge 1 Documents #1, supra, at Ex. 11, 14; USPTO Response, supra, at Ex. 3, 7; Managing Judge 1 Interview, supra,

at Tr. 1370-82, 1501-37, 1818-23; Chief Judge 2 Interview, supra, at Tr. 284-360; OIG IRF: Review I of Electronic Documents
Received from USPTO, Ex. 2-4, 11, 15-24.




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      U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


When asked why the PTAB did not hire judges before the Paralegal Specialists, one Senior
Manager informed the OIG that it was “a lot easier to hire paralegals than . . . judges” because
judge hires need to be approved by the Secretary of the Department of Commerce and
Paralegal Specialists can be hired directly by the PTAB and its Human Resources employees.243

       H. Lack of Work and Other Time

Evidence showed that, if Paralegal Specialists did not have work to do during their scheduled
workday, they were to log their time as “Other Time” (code A00131) in webTA, the PTAB’s
time and attendance program.244 One Senior Manager described this code as the “I don’t have
work but I’m going to get paid code.”245 One of Chief Judge 1’s direct reports informed the
OIG that Chief Judge 1 had directed Paralegal Specialists to record “nonproduction time” using
this code.246

Beginning in Fiscal Year 2009, after the hiring of 19 Paralegal Specialists in early 2009,247 the
amount of Other Time hours logged by Paralegal Specialists increased dramatically. Those
hours declined to and remained at or near zero after approximately May 20, 2013, when PTAB
managers instructed employees to work on special projects, as explained further below. See
Table 3.

           Table 3. Other Time Logged by Paralegal Specialists by Fiscal Year248
                                                          Other Time                 Number of
                                  Fiscal Year
                                                        (A00131) Hours               Paralegals
                                     2009                    8,141                      51
                                     2010                  28,243.25                    49
                                     2011                  27,013.75                    46
                                     2012                  25,947.75                    41
                                     2013                  11,096.25                    38

OIG found that over 43,000 hours of Other Time were recorded while Chief Judge 1 served as
Chief Judge from Fiscal Year 2009 until he retired in January 2011 (approximately 43% of the

243 Senior Manager 4 Interview, supra, at Tr. 793-816.
244 See, e.g., Paralegal 6 Interview, supra, at Tr. 862-68 (explaining that Paralegal Specialists used the Other Time code when they
“didn’t have any other work . . . . there was not work coming in, you didn’t have any work, you completed all your work . . .
and it’s what’s called ‘down time’ or ‘down period,’ that’s when you would use it”); Paralegal 3 Interview, supra, at Tr. 805-12
(stating that the Other Time code was to be used “when you’re not doing anything”); Manager 2 Interview, supra, at Tr. 1395-97,
1417-22 (stating that Paralegal Specialists were to log Other Time when they did not have work assigned); Manager 1 Interview,
supra, at Tr. 3302-03 (stating that Paralegal Specialists “used that non-production time [code in webTA] when they didn’t have
any work”); Paralegal 2 Interview, supra, at Tr. 981-87.
245 Senior Manager 6 Interview, supra, at Tr. 885-89.
246 See Managing Judge 1 Interview, supra, at Tr. 1654-61, 2351-59.
247 Paralegal 6 Interview, supra, at Tr. 598-610 (stating that “prior to 2009 [the workload] was pretty consistent . . . before they

did the hiring blitz . . . . Never had any . . . down time . . . . [Then after the new Paralegal Specialists were hired,] it wasn’t as
steady at times. And . . . then it was . . . points where it wasn’t any”).
248 OIG IRF: Data Analysis, supra. This table shows the total number of individuals who worked as paralegals at any given point

during the year. Because relatively little Other Time was logged in Fiscal Year 2008, less than 350 hours, the OIG did not
factor it into its analyses.




28                                                                                                                  REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                 OFFICE OF INSPECTOR GENERAL


total Other Time); over 8,000 hours of Other Time were recorded while Managing Judge 1
served as Acting Chief Judge until the beginning of May 2011 (approximately 9% of the total
Other Time); and over 48,000 hours of Other Time were recorded during Chief Judge 2’s
tenure through the end of Fiscal Year 2013 (approximately 48% of the total Other Time).249

The percentage of Other Time logged by Paralegal Specialists was significant. In Fiscal Year
2009, Paralegal Specialists logged approximately 9% of their time as Other Time; 28% in 2010;
30% in 2011; and 31% in 2012.250 From the beginning of Fiscal Year 2013 through mid-May
2013, Paralegal Specialists logged approximately 22% of their time to Other Time, and from
mid-May 2013 to September 2013, they logged approximately 1% of their time to Other
Time.251 See Figure 1.

                   Figure 1. Percent of Total Hours Logged as Other Time252

               35%
                                                                     31%
                                                       30%
               30%                       28%

               25%
                                                                                   22%
               20%

               15%
                            9%
               10%

                  5%
                                                                                                  1%
                  0%
                         FY 2009       FY 2010       FY 2011       FY 2012       October    Mid-May
                                                                                2012 - Mid-  2013 -
                                                                                 May 2013 September
                                                                                              2013


As an example, the Paralegal Specialist with the greatest average Other Time between Fiscal
Years 2010 and 2013 logged 46% of her time as Other Time in 2010 and 60% of her time in
2011.253 The Paralegal Specialist with the second greatest average Other Time logged 61% of
her time as Other Time in 2010, 66% in 2011, and 13% in 2012.254 The Paralegal Specialist with
the third greatest average Other Time logged 53% of her time as Other Time in 2010, 35% in


249 Id. Because the exact date on which Former Chief Judge 2 ceased being Chief Judge was unclear, we used his retirement
date of January 1, 2011. Additionally, because Chief Judge 2 became Chief in early May 2011, we proportioned the amount of
Other Time between him and the Acting Chief for that year.
250 Id.
251 Id.
252 Id. We divided Fiscal Year 2013 into two segments because in mid-May, after the OIG had referred the OIG hotline

complaints to the PTAB, the PTAB began taking action to reduce Other Time to zero.
253 Id. This employee did not work as a Paralegal Specialist with the PTAB in 2012 and 2013.
254 Id. This employee did not work as a Paralegal Specialist with the PTAB in 2013.




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      U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


2011, 54% in 2012, and 33% in 2013.255 The Paralegal Specialists with the fourth greatest
average Other Time logged 56% of his time as Other Time in 2010, 55% of his time as Other
Time in 2011, 47% of his Time as Other Time in 2012, and 12% of his time as Other Time in
2013.256 As discussed below, all of these employees received performance bonuses, despite
their extensive non-productivity.

When asked why Paralegal Specialists had so much Other Time, Paralegal Specialists and their
supervisors stated to the OIG that there was not enough work for the Paralegal Specialists.257
The evidence showed that, although Chief Judge 1 hired 19 additional Paralegal Specialists in
2009, the PTAB was not able to hire the amount of judges desired before the hiring freeze was
instituted that year.258 As noted previously, Paralegal Specialists could not create their own
work – they relied on others, and judges’ opinions were one main source of work. Paralegal
Specialists completed the work that they were given, and then waited for their next
assignments.259

The evidence showed that some Paralegal Specialists believed that they were not required to
inform their supervisors if they did not have any more assignments and simply logged Other
Time after they completed their work. Several Paralegal Specialists told the OIG, for example,
that their supervisors knew their workload and knew when the paralegals finished their
assignments because of the way they submitted those assignments; therefore it was not
necessary for the Paralegal Specialists to inform their supervisors when they ran out of work.260

The evidence also showed that Supervisory Paralegal Specialists did not always require their
Paralegal Specialists to check in once finished with their assignments and before logging Other
Time.261 For example, one Supervisory Paralegal Specialist stated that it was more of a courtesy
when Paralegal Specialists checked in with the supervisor when they were not busy, rather than

255 Id.
256 Id.
257 See, e.g., Paralegal 5 Interview, supra, at Tr. 1112-26 (explaining that Paralegal Specialists did not have enough work because

there were not enough judges to provide work for the Paralegal Specialists that were hired); Manager 3 Interview, supra, at Tr.
2261 (stating that Paralegal Specialists “had ‘other’ time because they didn’t really have a lot of work”).
258 See Senior Manager 2 Interview, supra, at Tr. 1287-99.
259 See, e.g., Paralegal 6 Interview, supra, at Tr. 611-16, 707-10 (explaining that he waited for more work when he was finished

with his work and he did not talk to his supervisor about his lack of work because “they knew. The work [wa]s generated . . .
from them, so they have to know.”).
260 See, e.g., Paralegal 3 Interview, supra, at Tr. 565-68; Paralegal 6 Interview, supra, at Tr. 707-41 (stating to the OIG that

Supervisory Paralegal Specialists knew when Paralegal Specialists had finished working on decisions because they had to e-mail
the decisions to the supervisors when finished, and the Supervisory Paralegal Specialists knew when the Paralegal Specialists
finished their other tasks because it would show in a particular case tracking system); 748-54 (stating that there was “no way
they c[ould] not know [when they have work] because we . . . aren’t able to get our own work, everything is assigned through
them.”); Paralegal 7 Interview, supra, at Tr. 927-48, 1650-79 (her supervisor knew what she was working on and when she
finished her work, so it was “weird” to “send[] a person that gives you the work an email telling them you don’t have any
work”); Paralegal 1 Interview, supra, at Tr. 1282-91 (stating that during the “truly empty times,” he stopped telling his supervisor
that he had no work “because they kn[e]w [he] ha[d] no work”); Paralegal 9 Interview, supra, at Tr. 832-44 (she would not tell
her supervisor “every time [she] had no work to do . . . because you got the sense that there wasn’t anything to do . . . and you
were just kind of annoying . . . to constantly be like ‘I have nothing to do;” the supervisors knew).
261 See, e.g., Manager 2 Interview, supra, at Tr. 1005-43 (did not require paralegals to contact the supervisor when they did not

have work to do from 2009 to 2013 because the supervisor generally knew because the supervisor was assigning them the
work). Although one Supervisory Paralegal Specialist informed the OIG that she asked her Paralegal Specialists to check in
when they did not have work, she stated that they did not always do so and sometimes she knew they were not busy. Manager
4 Interview, supra, at Tr. 1205-33.




30                                                                                                                REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                        OFFICE OF INSPECTOR GENERAL


an expectation, because the supervisor knew how much work they had.262 Additionally, at least
one Supervisory Paralegal Specialist asked Paralegal Specialists not to send e-mails when they
finished their work because the supervisor knew their workload.263 One Paralegal Specialist
informed the OIG that her supervisor informed her that “there is not much work, and I know
there is not much work, and you can stop calling me every day and telling me you have nothing
to do because I know you have nothing to do.”264 A Senior Manager informed the OIG that he
did not believe the telework rules required Paralegal Specialists to inform their supervisors if
they did not have work to do.265 Another Senior Manager told the OIG that, although there
probably was not a written rule on what Paralegal Specialists were permitted to do while
logging Other Time, a “logical application” of the telework rules would be merely to require
Paralegal Specialists to “check[] their computer every 15 minutes and say[], yeah, I’m here, I’m
available, give me something to work on, I will work on it.”266 Although a Senior Manager
believed that the direction requiring Paralegal Specialists to obtain supervisory approval before
logging Other Time did not occur until 2013,267 the evidence suggested that it in July that
Supervisory Paralegal Specialists were told that Paralegal Specialists were to inform their
supervisors if they were out of work and that supervisors may deny use of Other Time if the




262  Manager 2 Interview, supra, at Tr. 1155-68. Another Supervisory Paralegal Specialist stated to the OIG that some of her
Paralegal Specialists would tell her that they needed work perhaps once a week or so, and others would not, and either way
she would know because she could see what she assigned them. Manager 1 Interview, supra, at Tr. 2207-42.
263 Paralegal 2 Interview, supra, at Tr. 481-530; Paralegal 2 Documents, supra (December 18, 2012, e-mail from a Supervisory

Paralegal Specialist to a Paralegal Specialist informing the latter: “No need to notify me when work is done” in response to an e-
mail from the Paralegal Specialist that she had completed her assigned work at 9:25 am). See also Paralegal 7 Interview, supra, at
Tr. 859-95 (in the past, Paralegal Specialists were required to tell their supervisors if they did not have work, but “after a while .
. . I guess it just faded out or something. Because they knew . . . . why are we doing this? . . . . I think . . . it used to get on the
supervisors’ nerves, because they knew we didn’t have anything”).
264 Paralegal 9 Interview, supra, at Tr. 955-59.
265 Senior Manager 5 Interview, supra, at Tr. 1277-87.
266 Id. at Tr. 1797-808. The evidence showed that a few Supervisory Paralegal Specialists asked their Paralegal Specialists at

various points to check in before logging Other Time. OIG IRF: Review of Documents from Manager 4 (March 26, 2012, e-mail
from Manager 4 to a group of Paralegal Specialists informing them to send her an e-mail when they are without work or
requesting Other Time; August 4, 2009, e-mail from Manager 4 to a group of Paralegal Specialists stating that employees must
“communicate\coordinate with their supervisor prior to being authorized to claim any amount of non-production time”).
267 See Senior Manager 1 Interview, supra, at Tr. 2657-87. Evidence showed that in December 13, 2012, Paralegal Specialists were

directed to inform their supervisors that they have run out of work before logging Other Time. OIG IRF: Review of
Documents from Manager 4 (December 13, 2012, e-mail from Senior Manager 3 to Paralegal Specialists and PTAB
management). The e-mail was sent to “add[] clarity for all employees concerned,” rather than to “change policy or procedure.”
The Senior Manager wrote, “As a reminder to paralegals and LIEs on production, the use of Other Time is limited to those
times when an employee has 1) run out of assigned work and 2) after informing the employees supervisor that they are out of
work, the supervisor has no additional work to assign. This is the general guideline. To add specificity to the general guideline
(the general guideline remains in full effect), effective Monday, 12/17/2012, if a paralegal has work on their [sic] docket at the
end of the pay period, no Other Time may be claimed from the date the work was assigned through the end of the pay period .
. . .” OIG IRF: Review of Documents from Manager 4 (December 13, 2012, e-mail from Senior Manager 3 to Paralegal
Specialists and PTAB management).




REPORT #13-1077                                                                                                                      31
      U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


Paralegal Specialists fail to do so.268 However, some Paralegal Specialists interviewed informed
OIG that even after this e-mail, they did not always inform their supervisors that they were out
of work because the supervisors knew or should have known and they would have been
contacting their supervisors constantly.269

The evidence showed that Paralegal Specialists who worked from home often conducted
personal activities while logging Other Time. According to Paralegal Specialists interviewed by
the OIG, PTAB paralegals engaged in the following activities while logging Other Time at home:

               watching television;                                          doing laundry;
               sending and receiving personal e-mails;                       using social media, such as Facebook;
               reading books, magazines, and the                             listening to the radio and watching
                newspaper;                                                     television;
               doing chores in the home;                                     browsing the internet;
               exercising at home;                                           making personal phone calls; and
               performing volunteer work from                                shopping online.270
                home;
Such non-productivity was apparently not limited to employees working from home. For
example, one Paralegal Specialist recalled that, when she was working in the PTAB office, a
couple of Paralegal Specialists brought in Kindles to read during the workday.271 At least one

268 See, e.g., OIG IRF: SM Documents, supra (July 30, 2012, e-mail from Senior Manager 5 to PTAB management). Then in a
December 2012 e-mail, a Senior Manager “add[ed] clarity” to this procedure when she informed the Paralegal Specialists that
they were to inform their supervisors before logging Other Time. Id. (December 13, 2012, e-mail from Senior Manager 3 to
Paralegal Specialists and other management). Specifically, Senior Manager 3, who is senior to Senior Managers 1 and 2, sent an
e-mail “reminder” to all of the Paralegal Specialists in December 2012 stating that logging Other Time is “limited to those times
when an employee has 1) run out of assigned work and 2) after informing the employee’s supervisor that they are out of work,
the supervisor has no additional work to assign. This is the general guideline,” and effective 12/17/2012, “if a paralegal has work
on their docket at the end of the pay period, no Other Time may be claimed from the date the work was assigned through the
end of the pay period (this may be adjusted to the following duty day after the work was assigned depending upon the time of
day the work was assigned.) . . . [example] Again, Other Time is only appropriate when an employee runs out of work and
there is none to assign. This does not change policy or procedure. It adds clarity for all employees concerned.” Id. (December
13, 2012, e-mail from Senior Manager 3 to Paralegal Specialists and other management).
269 See, e.g., Paralegal 3 Interview, supra, at Tr. 565-68; Paralegal 7 Interview, supra, at Tr. 927-48, 1650-79 (her supervisor knew

what she was working on and when she finished her work, so it was “weird” to “send[] a person that gives you the work an
email telling them you don’t have any work”); Paralegal 1 Interview, supra, at Tr. 1282-91 (stating that during the “truly empty
times,” he stopped telling his supervisor that he had no work “because they kn[e]w [he] ha[d] no work”); Paralegal 9 Interview,
supra, at Tr. 832-44 (she would not tell her supervisor “every time [she] had no work to do . . . because you got the sense that
there wasn’t anything to do . . . and you were just kind of annoying . . . to constantly be like ‘I have nothing to do;’ the
supervisors knew”).
270 See, e.g., [REDACTED] (e-mailed friends, read news, used social media, browsed the internet, did laundry); [REDACTED]

(read magazines, chores); [REDACTED] (watched television, browsed the internet, did chores in the house); [REDACTED]
(telephoned friends and relatives, e-mailed friends and relatives, browsed the internet, read magazines, listened to the
television, did chores around the house, did dishes); [REDACTED] (listened to the radio, browsed the internet, read the news
online); [REDACTED] (read a book, browsed the internet, shopped online, listening to the news, did the dishes and other
“little ten minute tasks like that”); [REDACTED] (sent personal e-mail, performed volunteer work at home); [REDACTED] (did
chores, watched television, browsed the internet, ran errands); [REDACTED] (used personal computer to handle banking, e-
mailed friends, read the newspaper, walked the dogs, exercised at home).
271 Paralegal 2 Interview, supra, at Tr. 1084-91.




32                                                                                                                 REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                          OFFICE OF INSPECTOR GENERAL


Paralegal Specialist informed the OIG that they did not recall being directed on what they
should not be doing when logging Other Time.272

Network log-on data further suggests that several Paralegal Specialists were not working while
recording Other Time. Paralegal Specialists were required to sign on to their communicators
when they were working,273 which required them to access USPTO’s virtual private network
from home. However, an examination of data showing when Paralegal Specialists were logged
on to the network showed some instances where Paralegal Specialists were logged in for less
time than they recorded as Other Time in their webTA.274 Some Paralegal Specialists
confirmed to the OIG that this time differential reflected that they were not likely at their
computers for some of the time they logged as Other Time.275

Several Supervisory Paralegal Specialists and PTAB management told the OIG that they
understood that the Paralegal Specialists were largely not working when logging Other Time.
For example, one Senior Manager stated that he would not have been “a bit surprised if there
were people who were going out to the golf course.”276 Another Senior Manager stated that
he believed that they were probably playing poker.277 A key member of management agreed
that the Paralegal Specialists were likely doing laundry, browsing the internet, or reading a
book, and were probably not at their desk but doing other things around the house and
checking periodically to make sure they were not assigned any work.278 A Senior Manager
stated to the OIG that some were probably watching television, reading books, and doing
chores.279 Another Senior Manager stated that she also believed that they may have been
watching television, doing laundry, and surfing the web.280 A Supervisory Paralegal Specialist
informed the OIG that she “suspect[e]d they were shopping” and they may have “done things
around their house” because “they’re not going to sit at their desk and stare at their
computer.”281 Another Supervisory Paralegal Specialist believed that the Paralegal Specialists
were probably watching television and relaxing.282 In fact, Chief Judge 2 stated to the OIG, “I
almost don’t blame [the Paralegal Specialists] for watching TV, because, I mean, you’re sitting
around for 800 hours.”283




272 See, e.g., Paralegal 3 Interview, supra, at Tr. 823-28.
273 Managing Judge 1 Interview, supra, at Tr. 740-43.
274 OIG IRF: Data Analysis, supra.
275 See Paralegal 2 Interview, supra, at Tr. 1188-1262; Paralegal 5 Interview, supra, at Tr. 684-727; Paralegal 7 Interview, supra, at Tr.

1256-397 (but see 2778-830); see also Manager 1 Interview, supra, at Tr. 3495-3503; Manager 2 Interview, supra, at Tr. 1844-1920;
Manager 3 Interview, supra, at Tr. 1866-74; Manager 4 Interview, supra, at Tr. 2262-2353; Senior Manager 1 Interview, supra, at Tr.
2569-2600; Senior Manager 2 Interview, supra, at Tr. 2414-22; Senior Manager 5 Interview, supra, at Tr. 1771-83; Paralegal 5
Interview, supra, at Tr. 707-26 (Paralegal Specialist informed the OIG that the Paralegal Specialist used to forward e-mail to a
personal phone, logged out of the network, and after receiving work, would log back in to the network).
276 Senior Manager 5 Interview, supra, at Tr. 1752-64.
277 Managing Judge 1 Interview, supra, at Tr. 2170-73.
278 Senior Manager 4 Interview, supra, at Tr. 2017-67.
279 See Senior Manager 1 Interview, supra, at Tr. 2284-98, 2368-84, 3368-405.
280 See Senior Manager 2 Interview, supra, at Tr. 2269-87.
281 Manager 3 Interview, supra, at Tr. 1783-93.
282 Manager 1 Interview, supra, at Tr. 3364-03.
283 Chief Judge 2 Interview, supra, at Tr. 2458-59.




REPORT #13-1077                                                                                                                         33
      U.S. DEPARTMENT OF COMMERCE                                     OFFICE OF INSPECTOR GENERAL


       I.   Substantial Bonuses Awarded to Employees Despite the Levels of Other Time

Despite the large amount of Other Time, most of the Paralegal Specialists received bonuses,
totaling $561,195.91 ($2,922.90 average per Paralegal Specialist among those who received
bonuses) from Fiscal Year 2009 through Fiscal Year 2013.284 The average bonus for those who
received bonuses was $2,200.48 in Fiscal Year 2009 (26 Paralegal Specialists did not receive
bonuses), $2,064.61 in Fiscal Year 2010 (five Paralegal Specialists did not receive bonuses),
$3,304.80 in Fiscal Year 2011 (one Paralegal Specialist did not receive a bonus), $3,364.81 in
Fiscal Year 2012 (one Paralegal Specialist did not receive a bonus), and $3,474.54 in Fiscal Year
2013 (all Paralegal Specialists received bonuses).285 See Figures 2 and 3.

                Figure 2. Average Paralegal Specialist Bonuses by Fiscal Year286


                 2013                                                          $3,474.54


                 2012                                                        $3,364.81


                 2011                                                        $3,304.80


                 2010                                     $2,064.61


                 2009                                       $2,200.48

                        $-      $500   $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000




284 OIG IRF: Data Analysis, supra.
285 Id.
286 Id.




34                                                                                         REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                     OFFICE OF INSPECTOR GENERAL


           Figure 3. Total Bonuses Paid to Paralegal Specialists by Fiscal Year287

                  $160,000
                                                                  $148,716
                  $140,000                                                            $134,592
                                                                                                        $132,033
                  $120,000
                                              $90,843
                  $100,000

                     $80,000
                                 $55,012
                     $60,000

                     $40,000

                     $20,000

                        $-
                               2009             2010                2011               2012                2013


First-line Supervisory Paralegal Specialists also received bonuses – totaling $120,523.55 between
Fiscal Year 2009 and Fiscal Year 2013 ($3,013.09 average per first-line Supervisory Paralegal
Specialist among those who received bonuses).288 The below table shows the number of
Paralegals Specialists and first-line Supervisory Paralegal Specialists who received bonuses each
year:

                          Table 4. Bonuses Paid to Paralegal Specialists and
                     First-Line Supervisory Paralegal Specialists by Fiscal Year289
                        Number of Bonuses             Total           Number of Bonuses              Total Supervisory
            Fiscal
                           Awarded to                Paralegal       Awarded to Supervisory              Paralegal
            Year
                        Paralegal Specialists       Specialists       Paralegal Specialists             Specialists
            2009                  25                    51                        7                           8
            2010                  44                    49                        0                           8
            2011                  45                    46                        8                           8
            2012                  40                    41                        8                           8
            2013                  38                    38                        8                           8

Additionally, Senior Managers who oversaw paralegal operations received $23,205 in bonuses in
Fiscal Year 2009, $27,464.00 in Fiscal Year 2011, $13,327.39 in Fiscal Year 2012, and $23,749 in
Fiscal Year 2013.290

Members of management stated to the OIG that, because of the Paralegal Specialists’ PAP and
Labor Agreement, they could not eliminate or reduce the amount of bonuses despite the large

287 Id.
288 Id. Supervisory Paralegal Specialists did not receive bonuses in 2010. Manager 1 Interview, supra, at Tr. 4527-45.
289 OIG IRF: Data Analysis, supra.
290 OHR Documents II, supra.




REPORT #13-1077                                                                                                          35
      U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


amount of Other Time.291 A Senior Manager stated that the PTAB “didn’t have a choice” to
pay the bonuses, “whether it[ was] a strict . . . entitlement from the union agreement, or just
past practice.” 292 Members of management explained to the OIG that they believed the
Paralegal Specialists were entitled to these bonuses because they received high ratings.293 Data
showed that 86% of all Paralegal Specialists obtained the highest rating possible from Fiscal Year
2009 through Fiscal Year 2013 despite the large amounts of Other Time during those years.294
See Figure 4.

                                  Figure 4. Paralegal Performance Ratings
                                          FY 2009 through 2013295

                                               1%       1%
                                                                11%


                                                                                 1 (Unacceptable)
                                                                                 2 (Marginal)
                                                                                 3 (Fully Successful)
                                                                                 4 (Commendable)
                                                                                 5 (Outstanding)

                                  86%




However, two Paralegal Specialists who had received Marginal ratings received bonuses in 2009
and 2010 worth $2,181 and $992, respectively.296

Other evidence indicated that management may have been able to forego or prorate bonuses.
For example, one Senior Manager recalled a discussion among senior management in which
they stated, “although we’re not obligated to provide bonuses, we’re still going to.”297 Another
Senior Manager stated to the OIG that, if management did not give a Paralegal Specialist a
bonus, and he or she had received a 500 performance rating, “there would have been issues . . .
. [w]ith EEO complaints . . . and/or [U]nion complaints,” suggesting that PTAB management


291 See, e.g., Senior Manager 5 Interview, supra, at Tr. 2514-36; Managing Judge 1 Interview, supra, at Tr. 2909-15; Chief Judge 2
Interview, supra, at Tr. 2793-809.
292 Senior Manager 1 Interview, supra, at Tr. 3629-50.
293 See, e.g., Manager 1 Interview, supra, at Tr. 4385-408 (because the Paralegal Specialists reached certain numerical goals, they

were entitled to bonuses under their PAP); see also Chief Judge 2 Interview, supra, at Tr. 2793-809 (explaining that Managing
Judge 1 and Senior Manager 5 told him “what we are required to pay in the way of bonuses is the subject of a union
agreement”); Managing Judge 1 Interview, supra, at Tr. 2909-12 (stating his understanding that bonuses for Paralegal Specialists
are “mandated by the union agreement”).
294 OIG IRF: Data Analysis, supra.
295 Id.
296 Id.
297 Senior Manager 1 Interview, supra, at Tr. 3645-50.




36                                                                                                                 REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL


elected to pay bonuses to avoid litigation or Union conflicts.298 This Senior Manager further
stated that management had not considered the argument that the Paralegal Specialists should
not have received bonuses in light of the fact that they were already getting full-time pay to
essentially work part-time.299

The evidence showed that Supervisory Paralegal Specialists rarely used the Other Time code
during this period, if at all.300 Given that their the Paralegal Specialists (the supervisors’
subordinates) were logging so much Other Time, and the Supervisory Paralegal Specialists spent
a significant portion of their time assigning and correcting the paralegals’ work, the OIG
inquired whether the Supervisory Paralegal Specialists had enough work to occupy a full-time
schedule. The responses indicated that they did not. For example, one Supervisory Paralegal
Specialist stated that from 2011 to 2013, “because of all the non-production time, there was
[sic] a lot of times, to be honest . . . where [she] was just sitting . . . at [her] desk with nothing
to do[,] . . . . absolutely nothing to do” and that “it made for a long and boring day.”301 When
asked whether this was typical among supervisors, she replied, “some had more [downtime]
than others.”302 Additionally, a Senior Manager informed the OIG that the Supervisory
Paralegal Specialists had free time, and although he instructed the Supervisory Paralegal
Specialists to “do more quality checking” during this time, the data showed that they likely did
not.303




298 Senior Manager 4 Interview, supra, at Tr. 2259-66.
299 Id. at Tr. 2322-31.
300 See, e.g., Manager 1 Interview, supra, at Tr. 3334-36 (answering that Supervisory Paralegal Specialists do not use the Other

Time code).
301 Manager 3 Interview, supra, at Tr. 1366-71, see also id. at Tr. 1491-93 (“I just felt really bad because I’m sitting at my desk,

staring at my computer with no work to do. And it just drove me crazy because it made my day so long.”), 2031-38 (“But if I
didn’t have anything to do, . . . what am I supposed to do if I have no work? If I had no work, nothing to assign, no projects, the
judges are not turning any work . . . . my job is dictated by the work that I receive from the judges.”).
302 Manager 3 Interview, supra, at 1373-76.
303 Senior Manager 1 Interview, supra, at 2419-23. He explained that when supervisors check decisions, they keep a record, and

when they check other work product, they only record the errors. Senior Manager 1 Interview, supra, at 2446-60. During the
time frame in question, the amount of checking of decisions did not increase,303 and the error rates did not increase. Senior
Manager 1 Interview, supra, at 2516-17. A Supervisory Paralegal Specialist also opined that errors did not increase over time.
See Manager 3 Interview, supra, at Tr. 661-67.




REPORT #13-1077                                                                                                                   37
      U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


       J.   PTAB Management Aware of Paralegal Specialists’ Use of Other Time

The evidence showed that it was well-known throughout the PTAB organization, including by
the Chief Judges, that Paralegal Specialists were recording large amounts of Other Time.304
One Senior Manager told the OIG that he “knew there was an issue [with Paralegal Specialists
logging a lot of Other Time] because . . . [his] understanding was, it was essentially . . . open
knowledge amongst management.”305 He also informed the OIG that the lack of work for
Paralegal Specialists and Other Time was a “known issue” as far back as 2009 when
management learned that they would not be allowed to hire the additional judges and patent
attorneys they had hoped to hire, although “there wasn’t a lot of discussion on it.”306

E-mails between PTAB employees also confirmed that other members of PTAB management
were aware of the Other Time problem as early as 2009.307 For example, Senior Manager 1
informed other Senior Managers, including the Administrative Officer, in July 2009 that work
would be “thin in the coming weeks” and sought direction regarding how much Other Time
Paralegal Specialists could log each day.308 In response, a Senior Manager informed the
Administrative Officer that approximately 20% of the Paralegal Specialists and Legal Instrument
Examiners (LIEs)309 had recorded Other Time in pay period 13.310 Similarly, in an e-mail from



304 See, e.g., Senior Manager 5 Interview, supra, at Tr. 1499-500 (“It was . . . my understand . . . that it was well known that there
was an issue [of a lot of Other Time].”); Senior Manager 6 Interview, supra, at Tr. 2776-83 (Supervisory Paralegal Specialists
“were just as aware of what was going on as anybody else”); see also Paralegal 6 Interview, supra, at Tr. 909-12 (stating that the
Paralegal Specialists logged Other Time without seeking permission because management “knew the situation . . . the work
wasn’t steady.”); Senior Manager 1 Interview, supra, at Tr. 2088-99 (management did not have meetings discussing Other Time
until late in the 2009 through 2013 timeframe and his perception was that “senior leaderships was aware” of the large amount
of Other Time, and his supervisors were not “getting direction on how to proceed); Senior Manager 2 Interview, supra, at Tr.
1831-54, 2008-13 (the supervisors “just kind of got used to the slowness” and “it was just kind of . . . known” that there was
not enough work; after Former Chief Judge 2 left the PTAB, “admin was looking at the T&A” and everyone knew about the
large amount of Other Time being logged); Manager 3 Interview, supra, at Tr. 2292-301, 1500-04 (When asked if she spoke with
her supervisor about the fact that there was so much Other Time, one Supervisory Paralegal Specialist responded that she
“didn’t have to tell [her supervisor] there was so much ‘other’ time, she already knew” and when they discussed it, her
supervisor told her that she needed “to keep [her] staff busy;” the Supervisory Paralegal Specialist’s response to that was “I
can’t keep my staff busy with work that I don’t have.”); Manager 4 Interview, supra, at Tr. 1555-75, 2211-20 (her supervisors
“every – we were all aware of [the lack of work];” “we could all see [the Other Time]” being logged); Paralegal 9 Interview,
supra, at Tr. 856-79 (the general consensus was that “[t]here was not much to do”).
305 Senior Manager 5 Interview, supra, at Tr. 1515-20; Senior Manager 1 Interview, supra, at Tr. 2088-99 (his perception was that

“senior leaderships was aware” of the large amount of Other Time being logged).
306 Senior Manager 5 Interview, supra, at Tr. 1847-85; see also Senior Manager 1 Interview, supra, at Tr. 2088-99, 3172-78 (“senior

leaderships was aware” of the large amount of Other Time being logged as early as the spring 2009).
307 OIG IRF: SM Documents, supra (Aug. 4, 2010, e-mail from Senior Manager 5 to other PTAB administrators). Another e-mail

from January 2011 also shows their awareness. Id. (in a January 24, 2011, e-mail, after a manager inquires whether the PTAB
could hire additional Paralegal Specialists, Senior Manager 5 informs other Senior Managers that “there is no reason (by the
numbers) to do any kind of recruitment at this time” and states that in the last pay period, that particular group had 11% Other
Time, “i.e., no real work to do.”).
308 Id. (May 8, 2013, e-mail from Senior Manager 5 to Managing Judge 2 attaching a July 1, 2009, e-mail from Senior Manager 1 to

the former Administrative Officer, Senior Manager 5, Senior Manager 4, and other management).
309 Between Fiscal Years 2009 and 2012, there were between five and seven LIEs. OIG IRF: Data Analysis. Between Fiscal

Years 2009 and 2013, LIEs worked on entering information, such as paneling assignments, in various computer systems;
electronically providing judges with eWFs; mailing docketing notices; and preparing eWFs. Managing Judge 1 Documents #2,
supra (attachment to July 16, 2013, e-mail from Managing Judge 1 to Senior Manager 6 and Chief Judge 2).
310 OIG IRF: SM Documents, supra (May 8, 2013, e-mail from Senior Manager 5 to Managing Judge 2 attaching a July 9, 2009, e-

mail from Senior Manager 5 to the former Administrative Officer).




38                                                                                                                  REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                 OFFICE OF INSPECTOR GENERAL


October 2009, Senior Manager 5 informed Senior Managers that a Paralegal Specialist had
logged more than 31 hours of Other Time in the last pay period.311

E-mail evidence also shows that management continued to be aware of the problem as the
years progressed. In an e-mail from August 2010, Senior Manager 5 suggested that another
Senior Manager use a Paralegal Specialist for a particular project “[s]ince we’ve probably still got
a lot of paralegals who are using ‘[O]ther [T]ime.’”312 In January 2011, Senior Manager 5 noted
to other Senior Managers that because the PTAB had 110 lawyers, it only needed 23 paralegals
“based on the 4:1 lawyer: paralegal ratio; i.e., we’ve got an overage of 14 paralegals, or
additional direct support for another 56 lawyers.”313 See Figure 5.




311 Id. (October 6, 2009, e-mail from Senior Manager 5 to other PTAB Senior Managers).
312 Id. (August 4, 2009, e-mail from Senior Manager 5 to other PTAB Senior Managers).
313 Id. (January 24, 2011, e-mail from Senior Manager 5 to other PTAB Senior Managers). When asked whether the PTAB had a

goal ratio of Paralegal Specialists to judges, the Chief Judge informed the OIG that the number of Paralegal Specialists that
existed at the time before he was Chief Judge “contemplated an increase in the number of judges.” Chief Judge 2 Interview,
supra, at Tr. 565-93.




REPORT #13-1077                                                                                                            39
      U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


                                                          Figure 5.314




In June 2011, in evaluating a separate issue, the same Senior Manager informed other Senior
Managers that Paralegal Specialists in one of the teams were logging between 45% and 55% of
314   OIG IRF: SM Documents, supra (January 24, 2011, e-mail) (redactions applied by the OIG).




40                                                                                                   REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


their time to Other Time.315 In September 2011, a Senior Manager asked Senior Manager 5 for
a “report on the amount of paralegal [O]ther [T]ime that was being used from bi-week to bi-
week.”316 Senior Manager 5 responded that there was an average of 36.7% of Other Time
across the PTAB over the past four pay periods, identified Other Time by specialty group, and
stated that the numbers indicate that PTAB could process more than 500 decisions per pay
period without additional resources.317 He included the Vice Chief Judge on the e-mail.318

In May 2012, Senior Manager 5 informed the same group of managers by e-mail of the high
levels of Other Time – over the past six pay periods, one team had an average of 76% of Other
Time, another above 50%.319 In late September 2012, Chief Judge 2 and other Senior Managers
discussed by e-mail the impact of Other Time.320 E-mails from early 2013 also showed that
Senior Manager 5 was tracking Other Time figures for management.321

Evidence established that even the Chief Judges knew of the Other Time problem. Chief Judge
1, who was Chief Judge from 2009 until he retired on January 1, 2011, declined the OIG’s
requests to be interviewed. However, interviews with PTAB witnesses and e-mails established
that he was also aware of the Other Time problem. For example, a Senior Manager informed
the OIG that Chief Judge 1 and other Senior Managers had meetings about the lack of work.322
One of Chief Judge 1’s direct reports informed the OIG that Chief Judge 1 had authorized the
use of Other Time, and so he knew of the existence of the issue.323

In his interview with the OIG, Chief Judge 2 originally stated that he recalled having “discussions
about [O]ther [T]ime and paralegal use of it” in 2013.324 Later in his interview, he stated that
he first looked at Other Time when a Senior Manager informed him of some of the individuals’
or teams’ Other Time sometime between mid-2012 and when the OIG sent the PTAB the
complaints in early 2013.325 However, e-mail evidence showed that he learned of the Other
Time problem at least as early as September 15, 2011. In particular, in response to an e-mail
on that date from top management providing Other Time figures over the past four pay periods
and stating that “if we have almost 40% of [O]ther [T]ime, we need to take action . . . This is a
real problem,” Chief Judge 2 wrote, “I completely agree with you.”326 He stated to the OIG

315 OIG IRF: Review II of Electronic Documents Received from USPTO (June 16, 2011, e-mail from Senior Manager 5 to other
PTAB Senior Managers).
316 Id. (September 16, 2011, e-mail from Senior Manager 5 to PTAB management).
317 Id. (September 16, 2011, e-mail from Senior Manager 5 to PTAB management).
318 Id. (September 16, 2011, e-mail from Senior Manager 5 to PTAB management).
319 Id. (May 21, 2012, e-mail from Senior Manager 5 to PTAB management).
320 Id. (September 26, 2012, e-mail from Senior Manager 5 to PTAB management).
321 See, e.g., id. (January 4, 2013, e-mail from Senior Manager 5 to PTAB management; January 4, 2013, e-mail from Senior

Manager 5 to PTAB management; January 18, 2013, e-mail from Senior Manager 5 to PTAB management; February 4, 2013, e-
mail from Senior Manager 5 to PTAB management; February 12, 2013, e-mail from Senior Manager 5 to PTAB management).
322 Senior Manager 4 Interview, supra, at Tr. 1432-64.
323 Managing Judge I Interview, supra, at Tr. 2351-64. Although Managing Judge 1 originally stated that Former Chief Judge 2 may

not have been aware of the great extent of Other Time being logged, Managing Judge 1 recognized that Former Chief Judge 2
“bypasse[d] the chain of command all the time” and so may have asked a Senior Manager to run the numbers without the
managing Judge’s knowledge. Id. at Tr. 2361-82
324 Chief Judge 2 Interview, supra, at Tr. 1752-90.
325 Id. at Tr. 2164-81.
326 OIG IRF: Review II of Electronic Documents Received from USPTO (September 15, 2011, e-mail from Chief Judge 2 to

Managing Judge 1).




REPORT #13-1077                                                                                                               41
      U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


that he relied on his staff to inform him of the problem.327 See Figure 6. Managing Judge 1, the
Acting Chief Judge between Chief Judge 1 and Chief Judge 2, told the OIG that, although he was
aware that paralegals were logging Other Time because Chief Judge 1 had permitted them to
do so, he had not recognized that it was a “huge problem” until September 2011.328

                                                         Figure 6.329




327 Chief Judge 2 Interview, supra, at Tr. 2207-15 (“As to . . . what that [Other Time] meant and its . . . significance or possible
cures . . . I le[ft] it as [PTAB management’s] responsibility to illuminate that, especially since my familiarity with the term
‘[O]ther [T]ime’ was quite minimal.”).
328 Managing Judge I Interview, supra, at Tr. 1701-75, 2345-47.
329 OIG IRF: Review II of Electronic Documents Received from USPTO (September 15, 2011, e-mail) (redactions applied by the

OIG).




42                                                                                                                 REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                     OFFICE OF INSPECTOR GENERAL


The evidence also showed that it was largely understood that certain teams were busier than
others.330 For example, Senior Managers stated to the OIG that the mechanical and electrical
teams were the busiest, followed by the chemical and the biotech teams.331 In theory, the
teams were supposed to shift work to other teams if they had excess work.332 In practice,
however, employees interviewed stated to the OIG that the Supervisory Paralegal Specialists
did not seem to shift the work in this manner.333

Although the evidence established that the PTAB’s senior-most management, including the
Chief Judges during the relevant time period, knew of the Other Time problem, there was no
evidence that executives outside of the PTAB knew of the problem. In interviews with the
OIG, the former USPTO Director and the former USPTO Deputy Director (who later was the
Acting USPTO Director) during the relevant time period stated that they were not aware of
the Other Time problem.334 They stated that the problem was not reported to them, and they
were not aware of any problems pertaining to PTAB Paralegal Specialists.335 In his interview
with the OIG, the former USPTO Director stated that prior to the interview, he was “totally
unaware” of any Other Time problems at the PTAB.336 In her interview with the OIG, the
former USPTO Deputy Director stated that she first learned of the Other Time problem
shortly after the USPTO responded to the OIG’s referral of the whistleblower complaints.337
Upon learning of the problem and reading the response letter, she was “crushingly
disappointed.”338 Furthermore, she would have expected PTAB managers to report the
problem to her before the OIG even became involved.339




330 See, e.g., Senior Manager 1 Interview, supra, at Tr. 2974-83 (management knew that some specialties received more cases than
others); Manager 4 Interview, supra, at Tr. 1430-46 (electrical teams were busier than the biotech teams); Paralegal 2 Interview,
supra, at Tr. 547-49 (responding that certain groups did more work than others); see also Paralegal 7 Interview, supra, at Tr. 753-
65 (stating that she was aware that the biotech team was very slow).
331 Senior Manager 4 Interview, supra, at Tr. 1411-24; Senior Manager 1 Interview, supra, at Tr. 1851-66 (electrical teams were the

busiest, followed by mechanical, and then the others – business methods, chemical, and biotech). See also Senior Manager 5,
supra, at 1336-46 (generally believed the electrical and mechanical teams were busiest, and the biotech, business methods, and
perhaps chemical teams were less busy); Paralegal 10 Interview, supra, at Tr. 703-20 (electrical and mechanical teams were very
busy, but the biotechnology and chemical teams “had almost no work”).
332 Senior Manager 4 Interview, supra, at Tr. 1389-410.
333 See, e.g., Paralegal 7 Interview, supra, at Tr. 677-725 (management ‘wanted everybody to work on their team,” management

did not want the teams to reallocate work when teams were very busy and others were not); Senior Manager 6 Interview, supra,
at 2863-67 (“they could have done better [to] share resources”), 2869-84, 2968-3017 (stating “the extent of the problem
probably was magnified because they didn’t take advantage enough of sharing amongst teams); Manager 3 Interview, supra, at Tr.
1423-83 (stating that her group would have had far less Other Time had the work been more evenly distributed).
334 See OIG IRF: Interview of Undersecretary of Commerce for Intellectual Property and Director of the USPTO [hereinafter

USPTO Director Interview]; OIG IRF: Interview of Deputy Undersecretary of Commerce for Intellectual Property and Deputy
Director of the USPTO, Tr. 46-71 [hereinafter USPTO Deputy Director Interview].
335 See USPTO Director Interview, supra; USPTO Deputy Director Interview, supra, at Tr. 72-88.
336 See USPTO Director Interview, supra.
337 See USPTO Deputy Director Interview, supra, at Tr. 46-71.
338 See id. at Tr. 159-62.
339 See id. at Tr. 163-66.




REPORT #13-1077                                                                                                                  43
      U.S. DEPARTMENT OF COMMERCE                                                  OFFICE OF INSPECTOR GENERAL


       K. Management’s Initial Efforts to Address Other Time Usage

The evidence established that, although PTAB management knew that Paralegal Specialists were
logging significant amounts of Other Time and the work was unevenly distributed, PTAB
management took little action. Managers who oversaw the Paralegal Specialists told the OIG
that they did not instruct the Supervisory Paralegal Specialists to ask the Paralegal Specialists
what they were actually doing while logging Other Time and did not recall anyone asking the
Paralegal Specialists what they were doing.340 In addition, there is no evidence that managers
reported to senior management their concerns about what the Paralegal Specialists were doing
while logging Other Time.341 One Senior Manager stated that he “just never thought of [what
they were doing while logging Other Time].”342 Another stated that no one asked the Paralegal
Specialists what they were doing because managers had the attitude that “if I don’t have
something to give them, then it’s not my business what they’re doing.”343 Chief Judge 2 stated
to the OIG that he “can say for sure, [he] spent next to no time thinking about what they were
doing” while logging Other Time.344 According to Chief Judge 2, the question in his mind was
not “What are they doing?” but rather “Why aren’t we getting them work?”345 He stated:

                    I don’t want to know whether people were watching TV or
                    walking or – or exercising. To me, it’s entirely irrelevant, because
                    I know – I don’t want to think about what they shouldn’t be
                    doing. I know what they should have been doing.346




340 See, e.g., Senior Manager 6 Interview, supra, at Tr. 1413-1422 [hereinafter Senior Manager 6 Interview] (Senior Manager 6 did
not ask Paralegal Specialists or any supervisors what the paralegals were doing when logging Other Time); Senior Manager 4
Interview, supra, at Tr. 2068-78 (he never asked Paralegal Specialists or asked anyone else to ask the Paralegal Specialists what
they were doing when logging Other Time); Senior Manager 5 Interview, supra, at Tr. 1814-20 (he never asked any supervisors
what Paralegal Specialists were doing while logging Other Time, and no one to his knowledge asked them this question); Senior
Manager 1 Interview, supra, at Tr. 2407-18, 2618-25 (he never called a Paralegal Specialist or supervisor to inquire what Paralegal
Specialists were doing while logging Other Time); Senior Manager 2 Interview, supra, at Tr. 2293-300 (she did not think to ask the
Paralegal Specialists what they were doing while logging Other Time; she was always busy although she recognized the Paralegal
Specialists were not); Managing Judge 1 Interview, supra, at Tr. 2157-211 (stating that he did not believe there would be a
purpose to asking what they were doing while logging Other Time because there was no work to give them, and he did not
recall anyone asking them what they were doing); Manager 3 Interview, supra, at Tr. 2242-48 (Supervisory Paralegal Specialist did
not ask her Paralegal Specialists what they did while they were logging Other Time because she could not ask them about how
they spent those hours – “because that means then the next thing you know I’m going to be accused of harassing them;” she
could only ask them “anything . . . if they took too long to turn a case around”); Manager 2 Interview, supra, at Tr. 1620-58 (did
not ask his Paralegal Specialists what they were doing when logging Other Time; did not know if it was appropriate to ask
them); Manager 1 Interview, supra, at Tr. 3342-53 (never asked her Paralegal Specialists to keep a list of what they were doing
while logging Other Time); Manager 4 Interview, supra, at Tr. 2221-45 (did not ask her Paralegal Specialists to keep a record of
what they were doing while logging Other Time and did not recall supervisors asking her to do so).
341 See, e.g., Manager 3 Interview, supra, at Tr. 1809-13 (stating that she did not report to her supervisors her concern that they

may have been pursuing personal activities while logging Other Time).
342 Senior Manager 4 Interview, supra, at Tr. 2078.
343 Senior Manager 5 Interview, supra, at Tr. 1821-26.
344 Chief Judge 2 Interview, supra, at Tr. 2424-25; see also id. at Tr. 2380-89 (stating also that because he “thought there was no

need for it to exist, [he] gave next to no thought, really, . . . to what they might be doing with the time. And even the things I
thought they might be doing with the time, or that the time properly would be used for, I gave that relatively little thought as
well, because even those things seemed to me immediately trumped by our mountain of work.”)
345 Id. at Tr. 2407-10.
346 Id. at Tr. 2761-65.




44                                                                                                               REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                       OFFICE OF INSPECTOR GENERAL


The evidence showed that members of management took little action because they largely
believed that the Other Time problem would disappear as soon as they were able to hire
judges.347 For example, when Senior Manager 5 informed Managing Judge 1 in September 2011
that paralegals had logged an average of 36.7% Other Time over the past four pay periods,348
Managing Judge 1 responded that they “need[ed] to take action” and asked whether it was
“time to consider other, more serious actions.”349 Senior Manager 5 responded, however, that
“[in the] long-term, . . . this will resolve itself, if we get the judges that we’re asking for.”350 In
addition to managers’ belief that the Other Time problem would disappear when more judges
joined PTAB, management chose to retain Paralegal Specialists because they believed the
Paralegal Specialists had “exceptional qualifications” and because they expected an increased
workload and responsibilities for the PTAB once the AIA was implemented.351

PTAB management attempted to develop some projects to help Paralegal Specialists fill their
free time. The evidence showed, however, that many of these were never implemented. For
example, while Chief Judge 1 was Chief Judge, various members of the management team
discussed instituting “enhanced prepping,” which would have required Paralegal Specialists to
take extra steps in creating the eWFs, including highlighting specific portions and adding further
footnotes and information.352 Senior Managers informed the OIG that this idea was ultimately
rejected because either Human Relations or Labor Relations informed someone in management
that it would require further Union negotiations and so would not be “quick and easy,” and
some of the judges did not want the enhanced prepping.353 The management group also
considered having Paralegal Specialists provide updates on specific cases that had entered the


347 See, e.g., Senior Manager 5 Interview, supra, at Tr. 2454-65 (explaining that the waste was allowed to continue for so many
years because management did not realize the scope of the problem and the belief that PTAB would be permitted to hire more
judges and “gainfully employ[]” the Paralegal Specialists; the judges were “on the horizon”); Senior Manager 1 Interview, supra, at
Tr. 3190-96 (speculating that management believed the Other Time problem would be short-lived and hiring more judges
“would take care” of the problem); Managing Judge 1 Interview, supra, at Tr. 1740-44 (stating that the Other Time problem was
not on his “radar [as] something [he] was particularly concerned about . . . . We[ we]re trying to hire judges . . . . It[ would] go
away once we hire judges”); Senior Manager 2 Interview, supra, at Tr. 2027-30 (stating that she thought “everybody just thought
it was okay to use [O]ther [T]ime until the work came in . . . until we hired the new judges”).
348 OIG IRF: SM Documents, supra (September 15, 2011, e-mail from Senior Manager 5 to Managing Judge 1).
349 Id. (September 15, 2011, e-mail from Senior Manager 5 to Managing Judge 1).
350 Id. (September 15, 2011, e-mail from Senior Manager 5 to Managing Judge 1). Although evidence showed that management

believed that the hiring of judges would resolve the Other Time problem, it is unclear that such hiring would have an immediate
impact on the workload of the Paralegal Specialists given that, according to testimony and e-mail evidence, it took
approximately nine months to more than one year for newly-hired judges to “come up to full speed.” Managing Judge 1
Interview, supra, at Tr. 2590-617; OIG IRF: Review I of Electronic Documents Received from USPTO, Ex. 3, 4, 18-19, 21.
“[S]ometimes [hiring new judges even] ha[d] a negative effect [on the backlog] because you ha[d] to train them, and it t[ook] . .
. your experienced judges offline to train the new judges.” Managing Judge 1 Interview, supra, at Tr. 2590-600.
351 See Managing Judge 1 Documents #1, supra, at Ex. 16; USPTO Response, supra, at Ex. 3, 7, 9, App. B. For example, Managing

Judge 1 stated that the last group of Paralegal Specialists hired were the most productive, and he wanted “to keep these people
because they’re good for the board, and maybe we’ll get judges.” Managing Judge 1 Interview, supra, at Tr. 1746-54. One Senior
Manager informed the OIG that there was resistance to encouraging Paralegal Specialists to take details because “some of [the]
best paralegals were going out, supporting other parts of the office . . . . .so [they would] . . . lose the strength of [their] best,”
and particularly when they received the new wave of AIA work. See Senior Manager 6 Interview, supra, at Tr. 1829-43.
352 Senior Manager 4 Interview, supra, at Tr. 1451-88.
353 See id. at Tr. 1490-521. One Senior Manager informed the OIG that the PTAB began a “pilot program” implementing the

enhanced prepping project, but this project ended perhaps because of a “union problem” (“I don’t know if they thought the
work was too difficult”) and because some of the judges did not like the project. Senior Manager 2 Interview, supra, at Tr. 1711-
56.




REPORT #13-1077                                                                                                                     45
      U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


federal litigation phase; however, the “problem [with that project] [wa]s when you only send
about 50 cases of . . . yours . . . to the federal courts, there’s not a whole lot of work in that.”354

Another project that was not implemented was discussed in September 2012 as a result of a
key member of the management team directing Senior Managers to get “somebody” to work
on the USPTO “Director[’s]” project allowing them to search the text of unassigned docketed
cases.355 A Senior Manager believed that the project could be completed in less than two pay
periods and could eliminate Other Time during that time.356 However, a later e-mail indicates
that Senior Managers pushed back on assigning Paralegal Specialists to this project because it
was the end of the year, and they wanted “paralegals dedicated to decision processing” or else
there may be “performance degradation.”357 Thus, the managers undertook the project
themselves.

In addition, according to the evidence many of the projects that were implemented were
accomplished very quickly.358 Some Paralegal Specialists were assigned to a project writing an
article on the history of the PTAB.359 It was never published.360 In November 2012, a Senior
Manager e-mailed other Senior Managers about using Paralegal Specialists who had high Other
Time to prepare and send Oral Hearing Notices.361 The Senior Managers responded that they
did not have a problem with this project, as long as the AIA and interference work remained a
priority.362 The data indicates, however, that any projects implemented at the time did not
significantly reduce Other Time.

Management also considered bringing all of the Paralegal Specialists to the office to organize
interference files, including those from the warehouse, and the library.363 But, according to one
Senior Manager, “there was always a reason why it was a really bad idea.”364

The OIG asked members of PTAB management whether they considered laying off Paralegal
Specialists, converting some or asking some to convert to part-time employment, encouraging
details, or having Paralegal Specialists with attorney licenses help draft opinions to reduce the
amount of Other Time hours logged. Managers responded that they did not seriously consider
a reduction-in-force as a solution because they believed they would eventually need the
Paralegal Specialists and, in the words of one Senior Manager, because of “all the [U]nion




354 Senior Manager 4 Interview, supra, at Tr. 1526-31.
355 OIG IRF: SM Documents, supra (September 10, 2012, e-mail from Senior Manager 5 to PTAB management).
356 Id. (September 11, 2012, e-mail from Senior Manager 5 to PTAB management).
357 Id. (September 11, 2012, e-mail from Senior Manager 5 to PTAB management).
358 See, e.g., Senior Manager 4 Interview, supra, at Tr. 1532-40, 1563-66.
359 Id. at Tr. 1532-48; Paralegal Specialist 2 Interview, supra, at Tr. 1533-1640; Senior Manager 1 Interview, supra, at Tr. 2777-92.
360 See Paralegal 2 Interview, supra, at Tr. 1532-1640 (describing the article project and stating that “there was a group of us that

worked on writing . . . an article about the history of the board. . . . which was never published”), 2129-31 (stating that she
worked on the article project in 2011).
361 OIG IRF: SM Documents, supra (November 9, 2012, e-mail from Senior Manager 5 to PTAB management).
362 Id. (November 9, 2012, e-mail from Senior Manager 5 to PTAB management).
363 Managing Judge 1 Interview, supra, at Tr. 2234-48.
364 Id. at Tr. 2241-44




46                                                                                                                  REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                       OFFICE OF INSPECTOR GENERAL


issues.”365 One key member of management similarly stated, “I would have been afraid of the
[U]nion issues . . . . [I]t was never seriously considered.”366 A Senior Manager also stated that
he believes there was a discussion on a reduction-in-force, but rejected that option because
their best performers – those recently hired with law degrees – would have been most
affected, and they did not want to lose that talent.367 Members of management also stated that
they did not recall considering converting or asking Paralegal Specialists to volunteer to convert
to part-time workers.368

Managing Judge 1 stated that, beginning in or around September 2011, he looked for detail
opportunities for Paralegal Specialists369 and communicated with other “business units” of the
USPTO to see whether they needed a detailee.370 Managing Judge 1 also stated that Paralegal
Specialists did obtain details within the USPTO.371 Similarly, a Senior Manager stated that, if
management learned of detail opportunities, it would send “broadcast messages” to the
paralegals.372

However, Paralegal Specialists interviewed by the OIG, including those who took details, largely
stated that they were not asked to consider a detail before the PTAB received the OIG hotline
referral in early 2013.373 Along these lines, more than one supervisor told the OIG that they
did not inform Paralegal Specialists of detail opportunities because they were not told that they
could or should do so.374 Additionally, Chief Judge 2 stated that he recalled discussing

365 See, e.g., Senior Manager 4 Interview, supra, at Tr. 1753-76; see also Senior Manager 5, supra, at Tr. 2382-413 (in 2009 or 2010
at the “very beginning” of the Other Time problem, management “abstract[ly]” discussed a RIF); Managing Judge 1 Interview,
supra, at Tr. 3024-39 (a layoff was not “seriously entertained at any point” because management hoped to hire judges and it
“didn’t make a whole lot of sense to fire them and then try and hire them”); Chief Judge 2 Interview, supra, at Tr. 1998-2001 (did
not discuss having a reduction-in-force); Senior Manager 2 Interview, supra, at Tr. 1873-902 (stating that she “would have laid off
people . . . if it [had been] up to [her]” and when this suggestion was raised by her and other Senior Managers, a Senior
Manager responded, “We can’t do that;” it was not clear to the Senior Manager whether the Senior Manager responded in this
manner because of the Union or because he expected work to increase).
366 Senior Manager 4 Interview, supra, at Tr. 1765-74.
367 Senior Manager 1 Interview, supra, at Tr. 2989-3017.
368 See, e.g., Senior Manager 4 Interview, supra, at Tr. 1706-1752 (he did not recall management discussing forcing or encouraging

Paralegal Specialists to shift to part-time); Senior Manager 5 Interview, supra, at Tr. 1677-99; Managing Judge 1 Interview, supra, at
Tr. 3019-23 (did not recall discussing shifting paralegals to part-time); Manager 2 Interview, supra, at Tr. 1342-44 (not aware if
Paralegal Specialists were allowed to go part-time).
369 Managing Judge 1 Interview, supra, at Tr. 1770-1784. This statement is inconsistent with one key Senior Manager’s statement

that no one discussed sending or encouraging Paralegal Specialists on details or moving Paralegal Specialists to other areas of
the USPTO until after they received the complaints from the OIG in 2013. Senior Manager 5 Interview, supra, at Tr. 1623-26.
Later this Senior Manager stated that he was not aware of anyone discussing shifting Paralegal Specialists to other departments
permanently, rather than for details. Id. at Tr. 2334-40.
370 Managing Judge 1 Interview, supra, at Tr. 3012-15. One Paralegal Specialist stated that some Paralegal Specialists left in around

2010 or 2011 and were “encouraged to move out. I think they realized they had too many paralegals.” Paralegal 10 Interview,
supra, at Tr. 899-909
371 Managing Judge 1 Interview, supra, at Tr. 1980-90.
372 Senior Manager 4 Interview, supra, at Tr. 1631-34.
373 See, e.g., Paralegal 1 Interview, supra, at Tr. 1134-36; Paralegal 9 Interview, supra, at Tr. 962-82 (no one spoke with her about

going on a detail and she did not consider it because she “always thought of details as something that were available to people
in higher positions”). One Paralegal Specialist recalled one e-mail that was sent to all Paralegal Specialists regarding a detail
opportunity. Paralegal 2 Interview, supra, at Tr. 780-89.
374 Manager 1 Interview, supra, at Tr. 2531-39; Manager 2 Interview, supra, at Tr. 1331-41 (stating that the supervisor never called

Paralegal Specialists to inform them of detail opportunities and was not told to encourage his Paralegal Specialists to look for
details); see also Manager 1 Interview, supra, at Tr. 2624-30 (none of her supervisors told her to tell her Paralegal Specialists to
look for details or other jobs).




REPORT #13-1077                                                                                                                    47
      U.S. DEPARTMENT OF COMMERCE                                   OFFICE OF INSPECTOR GENERAL


encouraging Paralegal Specialists to take details during “[O]ther [T]ime discussions,” but that
details did not make sense for 2012 through 2013 because “it’s only a matter of time before we
need twice as many paralegals as we currently have.”375

Members of management stated to the OIG that they did not explore the idea that Paralegal
Specialists with law degrees and attorney licenses could help draft opinions because they did
not have a technical background,376 or because the managers believed that it would have
created a problem with the Union.377 In explaining why Paralegal Specialists could not draft
opinions, after noting that they did not have technical backgrounds, one key member of
management added (1) it may have caused “a morale issue” because only Paralegal Specialists
with law degrees would be involved in this task, and (2) it may have led a Paralegal Specialist to
complain that he or she should be paid more and cause a desk audit.378 However, when asked
whether any of these reasons were discussed, he responded that they were not “[b]ecause
simply put . . . paralegals writing without a technical degree was – we never even came to that
one.”379

Additionally, a Senior Manager stated that the Union would have had a problem with having
Paralegal Specialists draft opinions because they were not hired to do this task, and if they had
started doing this task, the Union would have “start[ed] going crazy over it.”380 She stated that
the managers “had to be real careful about . . . what [they] gave the[ Paralegal Specialists].”381
However, again, she stated that there was not any discussion about this option382 and
management did not discuss it with the Union because “it wouldn’t have gotten past [Labor
Relations],” which would have rejected the idea based on the Senior Manager’s previous
experience.383

Similarly, a managing judge told the OIG that he did not recall discussing with other managers
giving Paralegal Specialists the opportunity to help draft opinions to move the cases forward.384
But he stated that the patent attorneys, who are unionized, already performed that function,
and the Paralegals Specialists could not become patent attorneys because the PTAB would have
had to competitively offer those positions, which was not an option during the hiring freeze.385

Another Senior Manager also stated that discussions regarding this idea did not go anywhere
and the “hang up” would have been the Union, although, again, they did not negotiate this with
the Union.386 One Senior Manager stated that the Union would inform management that
management could not do “[e]verything [it] tried to do,” often because the Union would argue


375 Chief Judge 2 Interview, supra, at Tr. 2021-48.
376 See, e.g., Senior Manager 1 Interview, supra, at Tr. 3022-31.
377 See, e.g., Senior Manager 2 Interview, supra, at Tr. 2100-04.
378 Senior Manager 4 Interview, supra, at Tr. 1818-1931.
379 Id. at Tr. 1932-40.
380 Senior Manager 2 Interview, supra, at Tr. 2108-12.
381 Id. at Tr. 2125-26.
382 Id. at Tr. 2121-23.
383 Id. at Tr. 2129-41.
384 Managing Judge 1 Interview, supra, at Tr. 3047-64.
385 Id.
386 Senior Manager 5 Interview, supra, at Tr. 2414-43.




48                                                                                    REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


that the activity was not within the Paralegal Specialists’ PAP.387 She stated that the Union was
“just a huge stumbling block to us” and voiced her frustration.388 A managing judge stated that
he believed there was “resistance” by managers beneath him to dealing with the Union, and
whether they did depended on “whether or not the order c[ame] through [from a more senior
manager], just do it anyways.”389 One Senior Manager stated that, throughout the relevant time
frame, the PTAB did not change certain items related to the Paralegal Specialists’ PAP “because
it involved dealing with the bargaining unit and that was deemed as too hard.”390 He stated that
he believed that attitude came from the Chief Judge at the time.”391

According to one Senior Manager, the Other Time figures began “trending generally
downwards” in late 2012.392 Management interviewed by the OIG explained that Other Time
hours were decreasing because more judges had been hired and the PTAB began receiving AIA
cases, and so there was more work for Paralegal Specialists.393 According to Senior Manager 5,
the first round of new judges hired after the hiring freeze were a couple of patent attorneys
who had converted into judges in approximately December 2011.394 Managing Judge 1 also
credited the reduction in Other Time to an incentive program that had been implemented for
judges to finish more opinions395 and the fact that three of the Paralegal Specialists left the
PTAB on details to other organizations.396 However, Other Time was still significant – as late
as February 4, 2013, the PTAB estimated that the average amount of Other Time billed since
the beginning of Fiscal Year 2013 was as high as 58% for one group, 47% for another, and 45%
for a third.397

When discussing with the OIG why he thought the Other Time problem was not effectively
addressed, Managing Judge 1 informed the OIG that from 2011 to 2013 top management was
occupied with the task of implementing the AIA, including drafting new rules, launching a new
information technology system to take in the cases, and hiring new judges.398 He stated that


387 See Senior Manager 2 Interview, supra, at Tr. 2142-51.
388 See id. at Tr. 2157-63.
389 Managing Judge 1 Interview, supra, at Tr. 3126-28. He also stated that the objections to dealing with the Union are

“legitimate” – for example, when it would take two years to negotiate something that needed to be resolved more quickly. See
id. at Tr. 3133-38.
390 See OIG IRF: Review II of Electronic Documents Received from USPTO, Ex. 14 (July 17, 2013, e-mail from Senior Manager 1

to Chief Judge 2).
391 Id.
392 See, e.g., OIG IRF: SM Documents, supra (December 17, 2012, e-mail from Senior Manager 5 to PTAB management).
393 See, e.g., Senior Manager 2 Interview, supra, at 2041-46. In his Official Statement regarding the complaints, Senior Manager 5

explained that Other Time was steadily declining since pay period 20 of 2012 when the PTAB first began receiving AIA cases.
See USPTO Response, supra, at Ex. 7 (Official Statement of Senior Manager 5).
394 Senior Manager 5, supra, at Tr. 1923-52.
395 See Managing Judge I Interview, supra, at 2019-24, 2541-89 (beginning approximately two or three years ago, the bonus

programs essentially provided quarterly cash bonuses to judges completing more decisions). In the first year of the bonus
program, approximately 3,000 additional cases were issued. Id. at Tr. 2580-89. Although Managing Judge 1 stated that it is
more cost-efficient for the PTAB to provide bonuses to judges than hire additional judges to accomplish the work, in the long-
run he believed that it is better for the PTAB to hire more judges because “you can burn people out at this level of
productivity,” and he expects productivity of those judges receiving bonuses to drop eventually because “[n]obody can sustain
the levels of some of these people are going at. It’s a lot of voluntary overtime to make these levels.” Id. at Tr. 2633-44.
396 Id. at 2538-44.
397 OIG IRF: SM Documents, supra (February 4, 2013, e-mail from Senior Manager 5 to PTAB management).
398 Managing Judge 1 Interview, supra, at Tr. 1302-61.




REPORT #13-1077                                                                                                                 49
      U.S. DEPARTMENT OF COMMERCE                               OFFICE OF INSPECTOR GENERAL


management was “really . . . wrapped around that axel completely and fully.”399 And according
to Managing Judge 1, “at no point did anyone [in the three levels of management beneath him]
say, hey, this [fact that Paralegal Specialists are using Other Time] is a really big problem,” and
therefore he focused on his “other list of problems.”400

Chief Judge 2 similarly stated that he had too many problems on his plate during this time frame
to make the Other Time problem his “own personal problem.”401 He described his other
problems as growing the number of judges by more than 100, for which he interviewed
hundreds of candidates; growing the number of offices from one to six; traveling in connection
with the AIA rulemaking; working his “normal judge job;” and working his “normal chief judge
job.”402 He stated that “one has to prioritize which next area of cure you get to” in this type of
circumstance, and, in hindsight, he “kn[e]w this area of cure would not have come up for [him]
sooner, in part, because, unlike some of these other areas,” it took him time to recognize that
he did not “have confidence” in the information that he was getting from his senior staff
regarding this problem.403 The Chief Judge continued to state that, even in hindsight, in light of
the “enormous problems” that preceded the Other Time problem “and were tackled, [he]
wouldn’t have accelerated it beyond those other things, because the consequence of not getting
to the [O]ther [T]ime problem sooner is relatively few dollars in the grand scheme of what
[PTAB] spend[s] and do[es].”404 He reasoned that, if he had not addressed the “other
problems,” the PTAB would have failed to meet its “statutory obligations and our hiring, and all
sorts of other things.”405

Chief Judge 2 told the OIG that he recognized that there was a lag between when he learned of
the large amount of Other Time being logged by Paralegal Specialists and action being taken
about this problem.406 He stated that, after hearing about this issue a second or third time, he
thought, “[H]ow is this still a problem?”407 At that point, he “stress[ed]” to his staff the
importance of resolving the problem in late 2012.408 The figures show, however, that Other
Time did not significantly decrease in 2012 and did not do so until 2013, after the OIG referred
the whistleblower complaints to the PTAB.




399 Id. at Tr. 2523-30.
400 Id. at Tr. 1637-44.
401 Chief Judge 2 Interview, supra, at Tr. 2943-46.
402 Id. at Tr. 2943-73.
403 Id. at Tr. 2962-73.
404 Id. at Tr. 2983-87.
405 Id. at Tr. 2989-92.
406 See Chief Judge 2 Interview, supra, at Tr. 2229-47.
407 Id. at Tr. 2243-47
408 Id. at Tr. 2248-60.




50                                                                                     REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


      L. Changes Sparked by the OIG Referral

The evidence showed that, once the OIG referred the anonymous complaints to the PTAB in
early 2013, PTAB management, including Chief Judge 2, increased efforts to reduce Other
Time. On May 6, 2013, Managing Judge 1 informed Senior Managers that he needed an
“immediate plan for the reduction of paralegal use of [O]ther [T]ime down to zero,” and that
“[t]his is top priority.”409 The next day Chief Judge 2 sent out an agenda of “STUFF TO
COMPLETE” for the week of May 7, 2013, the first item being “Finalize plan to
eliminate/reduce/equalize ‘Other Time.’”410 In his e-mail, he also stated to Managing Judge 1,
Managing Judge 2, and Senior Manager 5,

                   Who has the assignment to speak to [Senior Manager 4] to let
                   him know that the IG wants answers and that this might not go
                   to [sic] well for him and others in the Board Administration
                   who are responsible for overseeing these things? What are the
                   paralegals doing would seem to be a basic question. By the way,
                   which individuals at the Board actually see the regular (?) numbers
                   showing the amount of paralegal Other Time? Also this situation
                   well might cause us to ask whether it really is acceptable to have
                   nearly all of the paralegals working off-site where their activities
                   cannot regularly be observed visually. Or is it simply that the
                   telework circumstance left the administrators . . . with a
                   heightened obligation to monitor the time usage?411

Managing Judge 2 again emphasized to Senior Managers the importance of reducing Other Time
to Senior Managers in an e-mail titled “Other Time”: “The IG won’t wait. I need a status
report today . . . . This is SERIOUS. Testimony is being finalized.”412

After receiving the OIG hotline complaints, the PTAB changed its organizational structure.
Chief Judge 2 spoke of some of these changes in his interview with the OIG.413 His testimony
and e-mail address evidenced that he held the Senior Managers responsible for the Other Time
problem. For example, in one e-mail he stated, “My belief is that the [senior-level
Administrative Officer] and the Supervisory [P]atent Administrators are and were responsible,
in the first instance, for managing the utilization, productivity and overall resource maximization
of the BPAI/PTAB paralegal corps . . . . And, therefore, underutilization and mis-utilization, of

409 OIG IRF: SM Documents, supra (May 6, 2013, e-mail from Managing Judge 1 to PTAB management).
410 Id. (May 7, 2013, e-mail from Managing Judge 1, Managing Judge 2, and Senior Manager 5).
411 Id. (May 7, 2013, e-mail from Managing Judge 1, Managing Judge 2, and Senior Manager 5).
412 Id. (June 25, 2013, e-mail from Managing Judge 2 to Senior Manager 1 and Senior Manager 2). See also Managing Judge 1

Documents #2, supra (on June 1, 2013, Managing Judge 2 forwards to Chief Judge 2 and Managing Judge 1 a June 1, 2013, e-mail
from Managing Judge 2 to Senior Manager 2 stating, “It is critical that there be NO more ‘[O]ther [T]ime’ which makes this
training and its implementation quite URGENT”).
413 See, e.g., Chief Judge 2 Interview, supra, at Tr. 1221-39, 1322-546 (one Senior Manager’s “responsiveness and attention to

detail at times left [him] not sure . . . we had quite the command of our situation here,” and his lack of confidence in another
manager’s reporting left him concerned with his management of staff beneath him), 2699-750 (stating that there were
individuals who “would have seen those reports [on Other Time] on a regular basis . . . . And it’s regrettable that, because they
would see that and I wouldn’t, I wouldn’t have occasion to be alerted to the problem . . . . But . . . that makes the fact that
those people would see it and not do anything about it an obstacle to my doing anything . . . about it.”).




REPORT #13-1077                                                                                                                51
      U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


that resource is something they need to justify.”414 Managing Judge 1 confirmed to the OIG that
Chief Judge 2 believed that the Other Time problem should have been resolved much earlier by
the Senior Managers.415 As a result, the existing third layer of supervision of the Paralegal
Specialists – the Support Administrators – was removed, and the second-level supervisors
started reporting to a Chief Clerk of the Board, who, in turn, reported to the newly created
Board Executive.416 Managing Judge 1 informed the OIG that, if the PTAB could have417 decided
to create the Board Executive position earlier, it is possible that the Other Time problem
would have been identified faster.418 He also recognized that the members of the organization
could have been reshuffled so that one of the many managers could have focused more on the
Paralegal Specialists.419

In addition, a Senior Manager informed the OIG that he recognized that, although the
Supervisory Paralegal Specialists did not create their own work, “they could have done better
[to] share resources.”420 He believed that they

                    approached it . . . very parochially . . . . So [each would think] if
                    nothing comes to my particular team’s mailbox, I then can’t . . .
                    assign work to my paralegals . . . . “I couldn’t do anything” . . . .
                    The extent they could have gone to another team supervisor and
                    asked, “Hey, do you have any work available . . . . to help me out”
                    – I think that’s perhaps where they failed . . . . I find it hard to
                    believe that there was absolutely no work available amongst any
                    of the teams. They could have done a better job.421


414 Managing Judge 1 Documents #2, supra (May 6, 2013, e-mail from Chief Judge 2 to his direct reports). Another managing
judge stated to the OIG that he became “frustrated” with his administrative staff on issues unrelated to Other Time, but
regarding “things to move the board forward,” such as creating a plan to open a new office. Managing Judge 1 Interview, supra, at
Tr. 3230-72. He ultimately relying upon lead judges to accomplish these projects. Id. at Tr. 3233-40. For example, a lead judge
ended up drafting the operating plan to open one of their new offices because “[n]ot one of [his] administrative staff would take
the project.” Id. at Tr. 3270-80.
415 Managing Judge 1 Interview, supra, at Tr. 3299-308.
416 See Senior Manager 6 Interview, supra, at 3050-78, 3169-90; Chief Judge 2 Interview, supra, at Tr. 1221-39, 2848-55; USPTO:

Who We Are, supra.
417 It is not clear that the PTAB could have created such a position during the portion of the relevant time frame when there

was a hiring freeze.
418 Managing Judge 1 Interview, supra, at Tr. 2410-25.
419 Id. at Tr. 2445-56.
420 Senior Manager 6 Interview, supra, at 2863-67. One Senior Manager stated to the OIG that he believed that the groups

worked “very well” at coordinating amongst themselves if they needed help with extra work. Senior Manager 1 Interview, supra,
at Tr. 1891-900. Although this manager did not have the perception that some Supervisory Paralegal Specialists would not
share work because he was trying to keep his team’s Other Time lower, he stated that pride would cause some managers to
not ask for help – “I can – my team can do this.” Id. at Tr. 1901-10. One Supervisory Paralegal Specialist stated to the OIG
that the supervisors would e-mail each other if they had extra work and needed help. Manager 1 Interview, supra, at Tr. 3828-
37.
421 Senior Manager 6 Interview, supra, at 2869-84; see also id. at Tr. 2968-3017 (stating “the extent of the problem probably was

magnified because they didn’t take advantage enough of sharing amongst teams . . . . Would that have solved the problems along
with a closer check and a – a stronger message on ‘hey, let’s make sure you do it right’? . . . . I think all those things would have
contributed to it” and agreeing that if the work had been spread out more among the groups, there would have been less
Other Time). One Supervisory Paralegal Specialist informed the OIG that her group would have had far less Other Time had
the judges been more evenly distributed amongst the teams, rather than assigning judges to teams by discipline, which left her
team with far fewer judges, and so far less work, than some of the other teams. Manager 3 Interview, supra, at Tr. 1423-83.




52                                                                                                                 REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


He would expect a “line employee” to argue that it was not his or her fault, not “any . . . level
manager.”422 According to the Senior Manager, however, supervisors should have been “doing
A through Z to find ways to prevent” staff from having no work.423 Statements from other
witnesses supported his assessment. For instance, one supervisor told the OIG that, before the
changes in 2013, she believed that supervisors did not have “authority” to ask for assistance
from another team when they ran out of work or needed help with excess work.424
Additionally, one Senior Manager informed the OIG that one supervisor was “aggressive” in
assigning any available docketing work to her employees before other supervisors could do so,
resulting in her team having far less Other Time than others.425 A Supervisory Paralegal
Specialist similarly stated that sometimes that the supervisor would hold a few cases overnight
to ensure the supervisor’s Paralegal Specialists have work the next day.426

Chief Judge 2 also stated to PTAB management in May 2013, “this situation well might cause us
to ask whether it really is acceptable to have nearly all of the paralegals working off-site where
their activities cannot regularly be observed visually. Or is it simply that the telework
circumstance left the administrators . . . with a heightened obligation to monitor the time
usage?”427 As noted previously, in his interview with the OIG, he stated that as early as when
he first became the Chief Judge at the PTAB he questioned the effectiveness of having nearly all
of the Paralegal Specialists telework.428 He also stated that “at various times, [he had] inquired
at the agency – various and many times – as to whether [the PTAB] could end that . . . .
generally the response to that ha[d] been, no, we can’t end it, and even if we wanted to . . .
there would be the huge obstacle of the discussions with the unions.”429 A Senior Manager also
stated to the OIG that he believed “one of the things that could have been done [to reduce the
amount of Other Time] was not have as many people on telework . . . . and the reason I say
that is just a personal observation that sometimes it is easier to have – spot projects done if
someone is present.”430


422 Senior Manager 6 Interview, supra, at Tr. 2885-91.
423 Id. at Tr. 3036-43.
424 Manager 3 Interview, supra, at Tr. 2625-42.
425 Senior Manager 1 Interview, supra, at 1705-50. Her manager stated that he is “sure” he had a conversation with her about

this. Id. at Tr. 1751-55. She would assign the work late at night or really early in the morning, and, before her manager
corrected her, she would assign work to herself to get work for her team. Id. at Tr. 1827-38.
426 See Manager 2 Interview, supra, at Tr. 1248-70.
427 Managing Judge 1 Documents #2, supra (May 7, 2013, e-mail from Chief Judge 2 to Managing Judge 2, Managing Judge 1, and

Senior Manager 5). Managing Judge 2 responded that he did not believe telework was the problem, but “if we allow telework,
we must havein [sic] place effective management. It is the supervisors who assign the work, review it and tabulate it.”
Managing Judge 1 Documents #2, supra (May 7, 2013, e-mail from Managing Judge 2 to Chief Judge 2 and Managing Judge 1). A
Senior Manager recognized one of the “dangers of telework” was that some employees would not work when they have work
assigned. Senior Manager 5 Interview, supra, at Tr. 1766-79.
428 Chief Judge 2 Interview, supra, at Tr. 1077-82 (he was shocked because he “wasn’t quite sure how . . . that kind of

arrangement necessarily facilitated the specific work of this board, which has a fundamental component of interactivity”); see
also id. at Tr. 974-76 (“I was surprised to learn that the board actually is in a circumstance where 90 percent of the paralegals
telework”); 1065-72 (“early on when [he] arrived . . . [he] was first shocked to learn of the amount of [teleworking]”).
429 Id. at Tr. 980-87; see also id. at Tr. 1088-129 (in 2012 he suggested teleworking was not “necessarily the arrangement [he]

would opt for” because he questioned “the diligence” or responsiveness of some of his Senior Managers, which “left [him]
uncertain as to what [he] could really know about . . . the diligence of the paralegals;” later qualifying that because he
questioned the responsiveness of some of his Senior Managers, he had to use other sources to “get a sense of what was going
on” and having Paralegal Specialists in the office “would [have] allow[ed] [him] . . . to get around some of that”).
430 Senior Manager 5 Interview, supra, at Tr. 2025-32.




REPORT #13-1077                                                                                                                 53
      U.S. DEPARTMENT OF COMMERCE                                                 OFFICE OF INSPECTOR GENERAL


On May 6, 2013, Managing Judge 2, who Chief Judge 2 tasked with heading the effort to reduce
Other Time431 e-mailed the Senior Managers to ask them to circulate “ideas for potential
plans.”432 Within a few hours, the Senior Managers had come up with multiple ideas, a few of
which were eventually implemented.433 One Senior Manager suggested:

                    Create “busy work” for the paralegals. Certainly not a long term
                    solution. The first idea that came to mind was have everyone go
                    back say 2 years and conduct quality checks on all the eWFs they
                    created (with no panel assigned). First verify that the eWFs are
                    on the S: drive and then perform a check using the checklist . . . .
                    I’m sure if we asked others we could come up with other busy
                    work that we’d simply classify under the Legal Administration
                    time code. Of course, this would require some management
                    “setup” and maybe even training.434

An “Other Time Elimination Plan” document was drafted, which compiled many of the ideas
circulated, including this eWF project, reassigning paralegals from a particular team, training
paralegals on trial work, detailing paralegals, permanently reassigning LIEs, updating weekly the
cases in litigation, reviewing old interferences for archive, and a reduction-in-force.435 Managing
Judge 2 sent a version of this plan to Chief Judge 2 and Managing Judge 1 on May 7, 2013.436

The eWF “special project”437 was implemented on May 20, 2013,438 and, according to one
Senior Manager, “eliminated” the Other Time.439 Paralegal Specialists were instructed to log


431 See Chief Judge 2 Interview, supra, at Tr. 1855-82 (stating that he asked Managing Judge 2 to help Senior Manager 5 and
Managing Judge 1 address the Other Time situation), 1894-98 (stating that Managing Judge 2, “whose role specifically was in the
administration realm . . . began to provide me . . . [O]ther [T]ime reports”), 1944-63 (indicating that he discussed the reduction
of Other Time with Managing Judge 2), 2229-61 (stating his recollection that he stressed resolving the Other Time problem
with Managing Judge 2, Managing Judge 1, and Senior Manager 5); see also Managing Judge 1 Interview, supra, at Tr. 2694-2717
(stating that Managing Judge 2 had a number of feasible projects for Paralegal Specialists to work on in lieu of logging Other
Time), 2719-21 (stating that Managing Judge 2 “had worked really hard with coming up with a list of projects” for Paralegal
Specialists to work on in lieu of logging Other Time), 2722-41 (stating that Managing Judge 2 “was a welcome relief” who
handled the implementation of projects for Paralegal Specialists to work in lieu of logging Other Time), 2750-73 (stating that
Managing Judge 2 “had a very good eye for management, so I trusted [him or her] implicitly to take care of” projects for
Paralegal Specialists to work on in lieu of logging Other Time).
432 OIG IRF: SM Documents, supra (May 6, 2013, e-mail from Managing Judge 2 to PTAB management).
433 See id. (May 6, 2013, e-mails between PTAB management).
434 Id. (May 6, 2013, e-mail from Senior Manager 1 to PTAB management).
435 See, e.g., id. (May 7, 2013, e-mail from Senior Manager 5 to Managing Judge 2).
436 Id. (May 7, 2013, e-mail from Managing Judge 2 to Chief Judge 2 and Managing Judge 1).
437 One Supervisory Paralegal Specialist described a “special project” as “anything that wouldn’t have been associated with . . .

processing a decision or an application.” Manager 2 Interview, supra, at Tr. 1470-73.
438 OIG IRF: Review of Documents from Paralegal 4, Ex. 3 [hereinafter Paralegal 4 Documents] (May 17, 2013, e-mail from

Senior Manager 1 to all Supervisory Paralegal Specialists with directions for the eWF special project); OIG IRF: SM Documents,
supra (June 20, 2013, e-mail from Senior Manager 1 to Managing Judge 2, Senior Manager 2, and Senior Manager 5 stating that
the eWF special project began on May 20, 2013). On July 2, 2013, one paralegal began working on a second project, which
required her to enter panel information to the eWFs if the panel had been assigned. Managing Judge 1 Documents #2, supra (July
3, 2013, e-mail from Managing Judge 2 to PTAB management). On June 5, 2013, paralegals were trained for reexamination and
trial work. See id. (June 25, 2013, e-mail from Managing Judge 2 to Managing Judge 1 providing the status of the Other Time
reduction plan).
439 Senior Manager 1 Interview, supra, at Tr. 2946-53 (stating that his perception was that because the eWF project eliminated

Other Time, management did not further pursue the other ideas).




54                                                                                                              REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                        OFFICE OF INSPECTOR GENERAL


their time on this project using the Legal Administration time code (L00131).440 Subsequently,
on June 3, 2013, Managing Judge 2 informed all Supervisory Paralegal Specialists, their
supervisors, and members of PTAB management, including Chief Judge 2, that “[t]he use of
Other Time should be a rare exception. Accordingly, effective immediately, supervisors will be
required to explain (to the Deputy Chief Judge) why [O]ther [T]ime was necessary and
approved for an employee . . . . Also, effective immediately, a report (by pay period) of time
codes utilized by employees should be prepared by the Managing Supervisory Paralegals . . . and
provided to me.”441 Managing Judge 1 informed the Supervisory Paralegal Specialists that
“[t]here should be no [O]ther [T]ime. The projects that Managing Judge 2 assigned should be
occurring in any unoccupied time.”442 Similarly, Senior Manager 5 informed Senior Manager 1,
“We would use Other Time only when we can’t find something more appropriate – and I think
we’re going to be trying very hard to find something appropriate!”443 Paralegal Specialists and
Supervisory Paralegal Specialists stated to the OIG that they understood that Paralegal
Specialists were not permitted to use the Other Time code anymore.444

The data showed that Other Time plummeted to near zero after this project began on May 20,
2013, and hours previously logged to Other Time largely shifted to the Legal Administration
code. The evidence showed that this shift was intentional – for example, Senior Manager 5
wrote to Managing Judge 1 that as of pay period 10 in 2013, Other Time “dropped to 0 . . .
(which [sic] small blips here and there) and Legal Administration being used starting at that time
. . . . Looking at the Board as a whole, it is looking about like I would expect it to be, with Legal
Administration claimed being about equal to Other Time claimed previously.”445 The data
support this statement:




440 Paralegal 4 Documents, supra, at Ex. 3 (May 17, 2013, e-mail from Senior Manager 1 to all Supervisory Paralegal Specialists).
441 OIG IRF: SM Documents, supra (June 3, 2013, e-mail from Managing Judge 2 to Supervisory Paralegal Specialists and PTAB
management, including Chief Judge 2); see also Senior Manager 1 Interview, supra, at 2657-87 (estimating that when the eWF
project was initiated was when Paralegal Specialists were given direction on not recording Other Time without supervisory
approval).
442 OIG IRF: SM Documents, supra (June 3, 2013, e-mail from Managing Judge 1 to Supervisory Paralegal Specialists and PTAB

management, including Chief Judge 2).
443 Id. (June 4, 2013, e-mail from Senior Manager 5 to Senior Manager 1 and other PTAB management). After that point, Senior

Manager 5 reported to Senior Manager 6 the “rationale” for any Other Time logged by Paralegal Specialists by pay period. See,
e.g., id. (August 27, 2013, e-mail from Senior Manager 5 to Senior Manager 6 detailing the number of hours of Other Time
logged in that pay period and the rationale for those hours; in this case, 5 1/4 hours of Other Time, two for a PTAB event and
2 1/4 likely for information technology problems).
444 See, e.g., Paralegal 6 Interview, supra, at Tr. 1122-26; Manager 3 Interview, supra, at Tr. 2453-72 (Paralegal Specialists were told

to stop using the Other Time code in webTA in 2013); Paralegal 7 Interview, supra, at Tr. 1398-505 (management told the
Paralegal Specialists “whatever you do, do not use that code;” she does not use it anymore even when she has a gap between
tasks); Paralegal 1 Interview, supra, at Tr. 1165-70 (Paralegal Specialists were told not to use the Other Time code anymore);
Paralegal 9 Interview, supra, at Tr. 1089-12 (about one year ago, she was told to not use the Other Time code, even for
computer down time).
445 OIG IRF: SM Documents, supra (July 15, 2013, e-mail from Senior Manager 5 to Managing Judge 1); see also Paralegal 6 Interview,

supra, at Tr. 1103-121 (a Paralegal Specialist noted in an interview with the OIG that it seemed as though the L00131 was
created to stop the Paralegal Specialists from using the Other Time code); Senior Manager 5 Interview, supra, at 2114-15 (L00131
“effectively replace[d]” A00131), Manager 2 Interview, supra, at Tr. 1488-95 (special projects were developed to prevent too
much Other Time).




REPORT #13-1077                                                                                                                      55
      U.S. DEPARTMENT OF COMMERCE                                         OFFICE OF INSPECTOR GENERAL


      Figure 7. Other Time (A00131) vs. Legal Administration (L00131) Over Time446

       1,500


                                                                                         May 20, 2013

       1,000




         500




           0
           FY 2011                        FY 2012                       FY 2013

                           A00131 Hours (Other Time)            L00131 Hours (Legal Administration)


Figure 8 clearly shows the transfer in hours from one code to the next by contrasting the pay
periods before and after the change:

                              Figure 8. Other Time v. Legal Administration447

                                       1600


                                       1200


                                        800


                                        400


                                          0
                                              April 21, 2013-   May 19, 2013-
                                               May 18, 2013     June 15, 2013

                                           Other Time     Legal Administration


In addition to creating special projects, which transferred a majority of the Other Time, PTAB
management found and acted on detail opportunities after the OIG referred the whistleblower


446   OIG IRF: Data Analysis, supra.
447   Id.




56                                                                                                    REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                     OFFICE OF INSPECTOR GENERAL


complaints to the USPTO. For example, on June 3, 2013, after Managing Judge 1 learned that
another division of the USPTO “is seeking some paralegals,” he e-mailed Managing Judge 2 and
Senior Manager 5, “Let’s make it happen.”448

Although some members of PTAB management disagreed,449 several Paralegal Specialists and
members of PTAB management informed the OIG that they viewed the special projects as
“busy work.”450 For example, when asked whether the eWF project was really necessary or
whether it was developed to merely fill Paralegal Specialists’ time, one Paralegal Specialist
responded that he believed they developed the project to “have us have something to do”
because in “all the years [the Paralegal Specialist has] been working [at the PTAB], . . . we never
had to do that [type of review].”451 Rather, witnesses told the OIG, the supervisors had
checked the eWFs previously, and they believed it was odd that paralegals were suddenly
checking the work.452 Additionally, one manager noted that this eWF project is not being done
anymore because “it’s not urgent” and the work is “cleanup.”453 Although she believed that the
project would have to be completed again eventually, she recognized that it could take more
than a year before they returned to it and that they may only do so because of her frustration
and realization that there are too many errors in the eWFs.454 Despite a number of individuals
classifying this project as busy work, one Senior Manager noted that, although management
originally created the project to “eliminate [O]ther [T]ime,” “it probably turned out to [be] . . .
of more value than we anticipated at first.”455

The “senior management specialist” who was tasked in July 2013 with resolving the “waste,
fraud, abuse” and “help[ing to] address some of the problems at [the] PTAB” explained to the
OIG that he was originally brought in to deal with the “paralegal operation . . . not being . . .
fully utilized, properly managed.”456 However, he then realized that, “in order to deal with that,
there’s other challenges of the supervisors, the staffing ratio, the training, the availability of
other resources to do some of those things.”457 He told the OIG that, aside from asking how

448 OIG IRF: SM Documents, supra (June 3, 2013, e-mail from Managing Judge 1 to Managing Judge 2 and Senior Manager 5).
449 See, e.g., Senior Manager 4 Interview, supra, at Tr. 1602-06 (“it was not to find, ‘Let’s keep them busy” . . . . I mean, if you
wanted to keep them busy, you’d farm them out to – on details and stuff like that,” which they “did do”); Senior Manager 2
Interview, supra, at Tr. 3202-15 (the eWF project was helpful because “[a]t some point there has to be a cleanup,” although if
there had not been an Other Time problem, they may not have instituted the project at that time); Managing Judge 1 Interview,
supra, at 2774-840 (stating that the eWF project was helpful, particularly in determining if a case can be dismissed based on
actions taken in the years before the appeal is examined by a Judge); Manager 3 Interview, supra, at Tr. 2425-45 (originally
agreeing that the eWF project was busy work, and then stating that “it could be viewed as busy work, but it was a worthwhile
project”); Manager 4 Interview, supra, at Tr. 1130-35 (the special projects included “work . . . that needed to be done”).
450 See, e.g., Senior Manager 1 Interview, supra, at Tr. 2667-71 (referring to the eWF project as “busy work”); Manager 1 Interview,

supra, at Tr. 3428-35 (stating that some of the special projects were “necessary work . . . and then some of them might have
been just to keep them busy”); Paralegal 9 Interview, supra, at Tr. 881-88 (she was “given the impression that [the special
projects on which the ex parte Paralegal Specialists were working] was almost manufactured work . . . and that my supervisors
weren’t as interested in manufacturing work”); Paralegal 10 Interview, supra, at Tr. 487-99 (“on occasion” she felt that the
projects were “manufactured to suck up time”). One Senior Manager recognized that “there [we]re paralegals on staff who
believe[d] that that was not value added work,” and “[t]hat it was busy work.” Senior Manager 5 Interview, supra, at 2270-74.
451 Paralegal 6 Interview, supra, at Tr. 1131-40.
452 See id. at Tr. 1142-49.
453 Senior Manager 2 Interview, supra, at Tr. 1657-706.
454 Id.
455 Senior Manager 1 Interview, supra, at Tr. 2719-25.
456 Senior Manager 6 Interview, supra, Tr. 355-88.
457 Id. at Tr. 392-99.




REPORT #13-1077                                                                                                                  57
      U.S. DEPARTMENT OF COMMERCE                              OFFICE OF INSPECTOR GENERAL


this situation could have happened, he never asked anyone why the Other Time waste was
allowed to continue for four years.458

He also worked with a well-known outside consulting firm (Outside Consulting Firm), which
conducted a workload/utilization analysis.459 Outside Consulting Firm found that the PTAB had
a significant backlog of appeal cases, with current production rates being insufficient.460 Outside
Consulting Firm also found that, from Fiscal Year 2010 to Fiscal Year 2013, the average
utilization rate of all non-supervisory Paralegal Specialists was 60%.461 The rate for Fiscal Year
2013 was approximately 15% higher than the rates for the other years and appeared to be the
result of a decrease in non-production hours and an increase in production hours.462 Outside
Consulting Firm stated that the cause for this shift could not be confirmed, but may be due to
actual increased production or to increased scrutiny on the use of Other Time.463
Furthermore, Outside Consulting Firm found that the amount of time allowed by the
production-based PAP to complete tasks was not reflective of the actual amount of time spent
completing those tasks.464 Additionally, Outside Consulting Firm found that the PTAB was
positively reducing its case backlog, as the monthly average number of cases disposed of in
Fiscal Year 2013 was slightly higher than the number of cases received.465

Outside Consulting Firm also found that the practice of organizing Paralegal Specialists into
subject matter teams may not be the most effective organizational design, as Paralegal
Specialists’ knowledge of a technical area was not required.466 Additionally, the consulting firm
concluded that Supervisory Paralegal Specialist-to-employee ratio of 1:4 was extremely low,
especially in a work environment “where oversight [wa]s not of utmost importance.”467 As a
comparison, the benched-marked USPTO Central Re-exam Unit and Appeals Center had a
combined supervisor-to-employee ratio of 1:23.468 Outside Consulting Firm further found that,
based on current data and planned production levels, the PTAB’s current number of Paralegal
Specialists exceeded the number of Paralegal Specialists the PTAB will require through 2016,
and possibly beyond.469

Senior Manager 6 explained to the OIG that he and management discussed Outside Consulting
Firm’s conclusion that the PTAB was at “70 percent capacity.”470 They decided that “further
investigation” was needed to determine (a) is the number accurate, and (b) if so, “what do we
do?”471 He stated that they decided that because the AIA work was “ramping up” and they


458 See id. at Tr. 1982-2055.
459 See id. at Tr. 420-21.
460 See Outside Consulting Firm Report, supra, at 3.
461 See id. at 4.
462 See id. at 3.
463 See id.
464 See id. at 5.
465 See id. at 6.
466 See id. at 7.
467 See id.
468 See id.
469 See id. at 8, 55.
470 See Senior Manager 6 Interview, supra, at Tr. 1741-48.
471 See id. at Tr. 1760-64, 1780-88.




58                                                                                    REPORT #13-1077
U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL


“need[ed] more and more assistance in that,” this 70% figure may be inaccurate and the PTAB
needed the 30% excess capacity to tackle the additional work.472

When asked whether, after receiving the whistleblower complaints, he and other managers
considered using Paralegal Specialists to write opinions, Senior Manager 6 stated that they did
not believe that they could because of the Union and because the Paralegal Specialists did not
have the technical backgrounds to do the work.473 However, they did not discuss with the
Union representative or USPTO Labor Relations staff whether the Paralegal Specialists could
undertake this task, and he did not recall whether they considered that clerks of federal courts
draft opinions on patent claims without having technical backgrounds; rather, they focused on
hiring additional judges and their patent attorney program.474 He stated that it was “too
complicated and . . . perhaps too heavy of a lift at [that] point” to explore the possibility of
having paralegals help draft opinions.475

Senior Manager 6 determined, however, that the paralegal PAP was “out of whack.”476 He
explained that the Paralegal Specialists “out produce[d] the PAP” because the Paralegal
Specialists could perform the work much faster than the PAP envisioned.477 Additionally, he
stated that the PAP did not appropriately measure the quality of their work because they were
only judged on reviews of a few cases rather than all of the cases.478 He also stated that he
believed that, after receiving feedback from judges and supervisors on the Paralegal Specialists’
work,479 it “just seemed to [him] that . . . not all paralegals should be outstanding or displaying
or exemplifying outstanding work.”480

Paralegal Specialists and managers also described the overall Outstanding performance rating
level as too easily attainable.481 Witnesses told the OIG that, even among Paralegal Specialists
who attained the Outstanding level (overall point score of 460 to 500), there was some
discontent about not receiving a perfect 500 score.482 Also, despite most Paralegal Specialists
receiving an Outstanding rating for the quality element, one Supervisory Paralegal Specialist
stated that there were issues with the quality of the Paralegal Specialists’ work product.483 That
Supervisory Paralegal Specialist expressed particular displeasure at the productivity element
criteria, stating that they did not accurately distinguish higher performers from lower
performers.484 As an example, the supervisor explained that one high-performing paralegal

472 See id. at Tr. 1791-804.
473 See, e.g., id. at Tr. 2060-98.
474 See, e.g., id. at Tr. 2099-197.
475 See, e.g., id. at Tr. 2199-225
476 See id. at Tr. 436-37.
477 See id. at Tr. 480-506.
478 See id. at Tr. 482-506; see also Manager 1, supra, at Tr. 4777-95 (although agreeing that management changed the PAP so not

as many Paralegal Specialists would get bonuses this year, recognizing that the previous production-based PAP did not
accurately reflect a Paralegal Specialist’s quality because it measured errors against all of the Paralegal Specialist’s activities
rather than product reviewed).
479 See Senior Manager 6 Interview, supra, at Tr. 509-528.
480 See id. at Tr. 620-29.
481 See, e.g., id. at Tr. 619-29, 703-12, 943-49, 2904-06; Paralegal 1 Interview, supra, at Tr. 2401-12; Senior Manager 2 Interview,

supra, at Tr. 1417-23; Paralegal 7 Interview, supra, at Tr. 2735-53; Manager 2 Interview, supra, at Tr. 2437-58.
482 See Senior Manager 4 Interview, supra, Tr. 2268-80.
483 See Manager 3 Interview, supra, at Tr. 1121-130.
484 See id.




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      U.S. DEPARTMENT OF COMMERCE                                                    OFFICE OF INSPECTOR GENERAL


achieved 300% of goal, while a lower-performing paralegal achieved 150%; both Paralegal
Specialists had to be rated Outstanding for the productivity element.485

Thus, management worked to change the PAP to a “generic” PAP, rather than a production-
based PAP until management could better understand the Paralegal Specialists’ new tasks and
activities related to the AIA cases and determine more accurate metrics to assess
performance.486 For example, Senior Manager 6 stated that he would like the quality element of
the next PAP to “be based on work that’s reviewed,” so that if a Supervisory Paralegal Specialist
reviewed five cases out of 100 and found five errors, the paralegal’s error rate would be five
out of five, rather than five out of 100.487 Others interviewed had different views – they
believed that Paralegal Specialists’ PAP was likely changed because too many Paralegal Specialists
were obtaining Outstanding ratings,488 which was probably disfavored by management given the
large amount of Other Time. As shown in Figure 4 above, 97% of Paralegal Specialists received
four or five ratings from Fiscal Years 2009 through 2013.

Additionally, bonuses given to Paralegal Specialists at the end of the 2013 calendar year were
pro-rated by the amount of Other Time logged. Senior Manager 6 informed the OIG that he
had “struggled with on the one hand . . . paying them . . . not to do work . . . . And then at the
end of the year, they’re also getting a bonus.”489 Thus, at the end of 2013, he changed the
calculation: rather than give a bonus to every Paralegal Specialist who reached the 1,250 total
hours threshold, he paid a bonus to the Paralegal Specialists who reached 1,250 hours excluding
Other Time.490 When asked why management did not pro rate the bonuses in the earlier
years, various members of management, including Chief Judge 2, stated that they did not know




485 See id.
486 See Senior Manager 6 Interview, supra, at Tr. 491-602, 754-82, 796-819.
487 Id. at Tr. 845-54.
488 See, e.g., Paralegal 6 Interview, supra, at Tr. 1556-95 (stating that the PAP was changed likely because it resulted in inaccurate

ratings); Senior Manager 5 Interview, supra, at Tr. 1238-48 (stating that it would not surprise him if management changed the PAP
in 2013 because nearly all of the Paralegal Specialists were receiving Outstanding ratings); Senior Manager 1 Interview, supra, at
Tr. 1419-27 (stating that the PAP was changed because “most everybody” was rated as Outstanding, which resulted in too
many Outstanding ratings); Senior Manager 2 Interview, supra, at 1420-23 (stating that the PAP was changed “because it was too
easy. Everybody was getting [O]utstanding.”); Paralegal 1 Interview, supra, at Tr. 1654-59, 2401-04 (stating that management
abolished the production system because too many Paralegal Specialists were being rated Outstanding); Paralegal 9 Interview,
supra, at Tr. 1602-09, 1646-47 (stating that the Paralegal Specialists were taken off of the production standard “because it was
determined that too many people were outstanding” and the “I think the idea is to get the bonuses down”); see also Manager 1
Interview, supra, at Tr. 1352-96 (stating that even if Paralegal Specialists had many hours of Other Time, they would still receive
the highest ratings because they finished the little amount of work they had in the right amount of time, which did not
accurately reflect their performance); Paralegal 7 Interview, supra, at Tr. 2695-764 (stating that although she understood that
management changed the PAP because they wanted Paralegal Specialists to slow down in order to reduce errors, she believed
that they changed the PAP from production because too many Paralegal Specialists got bonuses). One Senior Manager stated
that he understood that there was a “quality issue, particularly with decisions,” and the PAP did not accurately measure quality,
but he would have just adjusted the production units, rather than move to a generic PAP. [REDACTED]
489 Senior Manager 6 Interview, supra, at Tr. 872-79.
490 Id. at Tr. 881-93, 1039-74. For example, if a Paralegal Specialist works 1,149 productive hours, to calculate his bonus, one

would divide 1,149 by 1,250 and then multiply that figure by five percent of the Paralegal Specialist’s salary. See id. at 1096-102.




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U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL


of and did not consider this option.491 One Senior Manager stated that historically, calculating
bonus figures had “always been out of [supervisors’] hands.”492 Another stated that Paralegal
Specialists’ bonuses could not have been previously altered “because they were meeting the
criteria of their PAP,” but agreed that, if management reduced bonuses in 2013, management
could have done so in the prior years.493 When asked whether there was anything that led him
to believe that the bonuses could not have been pro-rated before this past occurrence, Senior
Manager 6 responded, “[N]o.”494

Chief Judge 2 recognized that prior years’ high ratings and bonuses were inappropriate. In an e-
mail to Senior Managers in July 2013 he wrote,

                    We need to ask ourselves not only, why were the performance
                    evaluations all so ridiculously high, but also, why were they so high
                    for so long without anybody saying this is absolutely ridiculous.

                    Similarly, we need to ask whether we approve bonuses in keeping
                    with a particular formula without taking a step back to see
                    whether it is truly appropriate to do so – regardless of union
                    considerations. The people on Capitol Hill who grill senior
                    officials and end their careers permanently don’t always extend
                    sympathy for people who say they were following accepted
                    practices or pre-existing deals when they proceeded to do
                    something that most taxpayers/voters would find highly
                    inappropriate. We have an obligation to scrutinize what we are
                    doing and not merely to fall into existing patterns of behavior.495

Similarly, Supervisory Paralegal Specialists and their supervisors received lower bonuses at the
end of 2013 because they were given lower ratings.496 When asked why, Senior Manager 6
stated that it was “hard for [him] to agree to a rating where all supervisors were [O]utstanding
. . . as they had been year after year . . . . I mean, again . . . they were just as aware of what was
going on as anybody else.”497 He was also “hard-pressed for either one of [the Paralegal

491 See, e.g., Chief Judge 2 Interview, supra, at Tr. 2793-809 (stating that when he started discussing the Other Time situation with
managers, he consulted with Managing Judge 1 and Senior Manager 5 about not awarding bonuses to Paralegal Specialists and
was told “what we are required to pay in the way of bonuses is the subject of a union agreement”); Managing Judge 1 Interview,
supra, at Tr. 2993-3004 (stating that he “can’t answer” the question of why bonuses for Paralegal Specialists were not pro-rated
prior to 2013); Senior Manager 6 Interview, supra, at Tr. 1162-75 (stating that nothing leads him or her to believe that that
bonuses for Paralegal Specialists could not be pro-rated in the years prior to 2013); Senior Manager 5 Interview, supra, at Tr.
2509-33 (stating that Paralegal Specialists received bonuses based on their performance rating and their bargaining unit
agreement), 2598-602 (stating that he felt as if he had no discretion over giving bonuses to Paralegal Specialists), 2640-67
(stating that he “thought it was kind of foolish” to give bonuses to Paralegal Specialists but believed, along with other managers,
that “we don’t really have an option in the matter”).
492 Senior Manager 1 Interview, supra, at Tr. 3687-707.
493 Senior Manager 2 Interview, supra, at Tr. 2869-70, 3096-152.
494 Senior Manager 6 Interview, supra, at Tr. 1162-74.
495 Managing Judge 1 Documents #2, supra (emphasis omitted) (July 17, 2013, e-mail from Chief Judge 2 to PTAB management).
496 See Senior Manager 6 Interview, supra, at Tr. 2726-83. One Senior Manager explained that the supervisors’ ratings were

“dropped” on their PAPs – everyone with an Outstanding received a Commendable, for example. Senior Manager 2 Interview,
supra, at Tr. 2859-65.
497 Senior Manager 6 Interview, supra, at Tr. 2726-83.




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      U.S. DEPARTMENT OF COMMERCE                                                  OFFICE OF INSPECTOR GENERAL


Specialists’] second-level supervisors to make a case that they should have been
[O]utstanding.”498 This Senior Manager made the decision on these managers’ bonuses and
Chief Judge 2 “signed off on [the bonuses].”499

More than one witness told the OIG that managers received lower performance ratings in 2013
in response to the OIG investigation, the Other Time, and the errors found in decisions.500
One witness stated to the OIG that a Senior Manager specifically stated to the employee that
Other Time was a reason the employee was receiving a lower rating.501 Another similarly
stated that the individual was informed in the individual’s review that the individual’s rating was
“marked down . . . because of all the ‘[O]ther’ [T]ime.”502

In an interview with the OIG, one Paralegal Specialist stated that there were still periods of
downtime, usually at the beginning of the month, and the Paralegal Specialist filled that time
with the eWF project.503 This Paralegal Specialist spent a full day the week before his OIG
interview working on the special project.504 Overall, however, the Fiscal Year 2013 data and
witness testimony indicated that Paralegal Specialists logged only minimal Other Time after May
2013 and were occupying any free time with projects management deemed helpful for the
PTAB. Further, evidence indicated that management was in the process of determining how to
best create a continuous and consistent flow of opinions from judges to Paralegal Specialists,
which should reduce the amount of time each month that Paralegal Specialists are without
work. For example, in July 2013, Senior Manager 4 suggested as a “long term goal” to “spread[]
out . . . the [j]udges decisions” as it otherwise causes “most teams [to] have more [O]ther
[T]ime at the beginning of the month than at the end of the month.”505




498 Id. at Tr. 2788-90.
499 Senior Manager 2 Interview, supra, at Tr. 2972, 3013-17.
500 [REDACTED] (describing lower performance ratings because of the OIG investigation, Other Time, and errors);

[REDACTED] (describing lower performance rating because of the Other Time, “IG . . . complaint and everything else”).
501 [REDACTED]
502 [REDACTED]
503 Paralegal 6 Interview, supra, at Tr. 1480-90.
504 Id. at Tr. 1505-08; see also Paralegal 11 Interview, supra, at Tr. 2055-68 (stating that she only processed one case the day

before her interview; there is still a workflow problem).
505 Managing Judge 1 Documents #2, supra (July 16, 2013 e-mail and attachment, from Senior Manager 4 to management, which

was forwarded to Chief Judge 2 that same day). A Senior Manager agreed that judges tend to submit more cases for review at
the end of the month, rather than the beginning, and also at March and September than at any other time of year. Senior
Manager 4 Interview, supra, at Tr. 1206-14; see also Senior Manager 1 Interview, supra, at Tr. 1296-303 (stating that the beginning
of each month is slower and the last week or ten days of each month judges submit more decisions); Senior Manager 2 Interview,
supra, at Tr. 2540-43 (when asked whether judges tend to work hardest at the end of the month and the end of the quarter,
responding “There’s a lot of that going on.”). A Senior Manager stated in his interview that recently “senior leadership has
taken steps to try . . . [to] be more consistent” and to get judges to submit opinions more consistently throughout each month
and may have added something to their PAP on this. Senior Manager 1 Interview, supra, at Tr. 1305-31.




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U.S. DEPARTMENT OF COMMERCE                                                OFFICE OF INSPECTOR GENERAL


       M. Cost of the Mismanagement to the PTAB

Because of the number of hours logged to Other Time, the PTAB incurred significant waste on
employees not engaged in work activities. Paralegal Specialists logged approximately 23% of
their time to Other Time between Fiscal Years 2009 and 2013. See Figure 9.

                                              Figure 9. Paralegal Hours
                                                  FY 2009 - 2013506


                                                                         23%




                                                 77%


                                                Other Time      Productive Hours


Further, Other Time was a significant percentage of total time logged each year. See Figure 10.


                          Figure 10. Other Time as a Percent of Total Hours507

                                   100%

                                       75%

                                       50%

                                       25%

                                       0%
                                              2009     2010     2011    2012       2013

                                             Other Time       Non-Other Time Hours


Additionally, as the backlog increased, Other Time continued to increase until PTAB
management worked to shift the Other Time hours to the Legal Administration code. See
Figure 11.

506   OIG IRF: Data Analysis, supra.
507   Id.




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      U.S. DEPARTMENT OF COMMERCE                                              OFFICE OF INSPECTOR GENERAL


                            Figure 11. Appeal Backlog and Other Time508

                          40,000                                                             100%


                          30,000                                                             75%


                          20,000                                                             50%
                                                             30%        31%
                                                  28%
                          10,000                                                   14%       25%
                                       9%

                                0                                                            0%
                                      2009       2010       2011       2012       2013

                                     Ex Parte Appeal Backlog            Percent Other Time



According to the OIG’s calculations, the monetary cost to the PTAB of this Paralegal Specialist
Other Time was significant: approximately $4,323,754.509 Including bonuses, that number jumps
to approximately $4,884,950. See Table 5.


        Table 5. Wages and Bonuses Paid to Paralegal Specialists by Fiscal Year510
                                             Other Time Wages to                Bonuses Paid to
                       Fiscal Year
                                              Paralegal Specialists           Paralegal Specialists
                           2009                      $318,871                         $55,012
                           2010                     $1,164,570                        $90,843
                           2011                     $1,169,443                       $148,716
                           2012                     $1,152,207                       $134,592
                           2013                      $518,663                        $132,033
                           Total                    $4,323,754                       $561,196
                   GRAND TOTAL
                                                                    $4,884,950
                   (Paralegals Only)




508 Id.
509 Id.
510 Id. “[C]alculations[] conducted by the Human Resources . . . Specialist who conducted the inquiry” showed higher Other

Time wages in years 2009 through 2012. USPTO Response, supra, at Appendix A (table of “PTAB Total Hours Charged to
‘Other Time’ by Paralegals by FY”).




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U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


Including the bonuses paid to the first-line Supervisory Paralegal Specialists and Senior Managers
overseeing the paralegal functions,511 that monetary cost increases to approximately $5.09
million, as shown in Table 6 and Figure 12:

         Table 6. Wages and Bonuses Paid to PTAB Employees by Fiscal Year512
                                                        Bonuses Paid to Paralegal
                                                        Specialists and First-Line           Bonuses Paid to Certain
      Fiscal Year         Other Time Wages
                                                         Supervisory Paralegal                  Senior Managers
                                                               Specialists
         2009                    $318,871                        $74,352                                $23,205
         2010                   $1,164,570                          $90,843                                $0
         2011                   $1,169,443                         $182,284                             $27,464
         2012                   $1,152,207                         $167,935                             $13,321
         2013                    $518,663                          $166,305                             $23,749
         Total                  $4,323,754                         $681,719                            $87,745
       GRAND
                                                                    $5,093,219
       TOTAL



                             Figure 12. The Cost of Other Time by Year513

                        $1,500,000



                        $1,000,000



                          $500,000



                                 $0
                                          2009        2010         2011         2012        2013

                                A00131 Wages                      Paralegal Bonuses by Year
                                Supervisor Bonuses by Year


In addition to the Other Time wages and bonuses earned by these paralegals, if the two “extra”
Paralegal Specialists had not been hired per Chief Judge 1’s orders, the PTAB would have also



511 These Senior Managers include the second-line managers of the Paralegal Specialists and the Administrative Officer, who was
involved in regularly tracking Other Time and in developing the PTAB’s plan to reduce Other Time following the OIG’s referral
of the whistleblower complaints. Additionally, the Administrative Officer was involved in calculating performance-based
bonuses for Paralegal Specialists and Supervisory Paralegal Specialists.
512 OIG IRF: Data Analysis, supra.
513 Id.




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      U.S. DEPARTMENT OF COMMERCE                                                 OFFICE OF INSPECTOR GENERAL


saved over $159,000 in wages for hours spent on activities not directly related to production
between Fiscal Years 2009 and 2013.514

Because it examined utilization, as opposed to waste, Outside Consulting Firm calculated
115,158.25 hours were underutilized from 2010 through 2013. See Table 7 below. In
calculating the amount of non-production time for utilization analysis purposes, Outside
Consulting Firm added Other Time to time charged to the following codes: corporate
initiatives, alternative dispute resolution services, Equal Employment Opportunity counseling,
awards and recognition, continuity of operations planning, Employee Assistance Program
counseling, volunteer employee organizations, contingent activities, Union representative
consultations, background investigations, Union meetings, management meetings, and grievance
presentations.515 In performing its waste calculations, the OIG did not include these activities
because treating some or all of these activities as non-production could create the impression
that they are not important and lead management to discourage its staff from performing such
activities. Outside Consulting Firm’s calculations of the total amount of paralegal non-
production time are listed in the table below.516

                         Table 7. Outside Consulting Firm’s Calculations of
                                 Paralegal Non-Production Time517

                                       Fiscal Year             Non-Production Hours

                                           2009              Not Included in Firm’s Report
                                           2010                          37,785.75
                                           2011                          35,615.75
                                           2012                          29,058.25
                                          2013*                          12,698.50
                                         Total*                        115,158.25

                                                                               * Through May 2013

The OIG replicated Outside Consulting Firm’s analysis to calculate the amount of wages paid
for non-production, as defined by Outside Consulting Firm.518 The OIG was also able to
expand the analysis to include Fiscal Year 2009 and all of Fiscal Year 2013. The OIG found the
following:




514 Id.
515 See Outside Consulting Firm Report, supra, at 19, unlabeled table of time codes appended to the numbered pages of the report.
516 See id. at 21.
517 See id.
518 In doing so, the OIG worked with the USPTO to make necessary adjustments to the data for accuracy purposes.




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U.S. DEPARTMENT OF COMMERCE                                 OFFICE OF INSPECTOR GENERAL


             Table 8. OIG Replication of Outside Consulting Firm’s Calculations of
                             Paralegal Non-Production Time519
                                          OIG Replication     OIG Replication:
                            Fiscal Year   Non-Production      Non-Production
                                              Hours               Wages
                                 2009        15,156.75          $587,830.48
                                 2010        36,838.50          $1,519,980.92
                                 2011        35,063.25          $1,514,609.24
                                 2012        30,022.00          $1,336,343.83
                                 2013        13,631.25          $635,426.48
                                Total       130,711.75         $5,594,190.95


Adding in the bonuses paid to the Paralegal Specialists and first-line Supervisory Paralegal
Specialists ($681,719) and the bonuses paid to the relevant Senior Managers ($87,745), the total
cost using the Outside Consulting Firm’s definition of non-production time equals
approximately $6,363,655.520

  II.       Analysis

        A. PTAB Incurred Gross Waste in Poorly Executing Its Hiring Plan and Failing to
           Timely Address the Other Time Problem.

The evidence established that, from Fiscal Year 2009 through Fiscal Year 2013, the PTAB paid
numerous Paralegal Specialists full-time wages, even though the paralegals spent a considerable
portion of their work hours doing nothing. In fact, some of these employees logged more than
half of their work hours to the Other Time code. Worse, the evidence established that,
despite the huge volume of non-productive work time among PTAB’s Paralegal Specialists,
these employees received thousands of dollars in bonuses every year.

We found that these expenditures were wasteful. As explained above, the waste in paying
Paralegal Specialists for non-production time during the relevant time period ranged between
$4.3 million and $5.6 million, depending on whether the OIG’s or Outside Consulting Firm’s
formula is used. Adding in approximately $681,719 in bonuses paid to the Paralegal Specialists
and first-line Supervisory Paralegal Specialists and $87,745 in bonuses paid to the Senior
Managers overseeing paralegal operations, the total amount of wasteful spending rises to
between $5.09 million and $6.4 million.




519   OIG IRF: Data Analysis, supra.
520   Id.




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      U.S. DEPARTMENT OF COMMERCE                                      OFFICE OF INSPECTOR GENERAL


It is particularly egregious that Paralegal Specialists with extremely high rates of Other Time still
earned bonuses. For instance, the four Paralegal Specialists with the highest averages of Other
Time from Fiscal Years 2010 through 2013 earned several thousand dollars in bonuses each
year, as reflected in the following table:

            Table 9. Bonuses Paid to Paralegal Specialists with the Highest Average
                      Other Time between Fiscal Years 2010 and 2013521

                  Paralegal Specialist   2010        2011           2012             2013


                       Paralegal A       $2,393      $3,227   No longer in       No longer in
                  (Percent Other Time)   (46%)       (60%)     position           position


                       Paralegal B       $2,440      $3,227       $3,331.50      No longer in
                  (Percent Other Time)   (61%)       (66%)          (13%)         position


                       Paralegal C       $2,016      $3,123       $3,227.40        $3,331.50
                  (Percent Other Time)   (53%)       (35%)          (54%)            (33%)


                       Paralegal D       $2,602      $3,436       $3,435.60        $3,539.70
                  (Percent Other Time)   (56%)       (55%)          (47%)            (12%)


The majority of the wasteful spending occurred during the tenures of Chief Judge 1 and Chief
Judge 2. The table below provides an approximate breakdown of total wages paid for Other
Time during the tenures of the respective Chief Judges.

                Table 10. Approximate Wages Paid to Paralegal Specialists for
                     Time Spent Logging Other Time (by Chief Judge)522

                      Chief Judge 1          Acting Chief Judge             Chief Judge 2
                      (2009-2010)         (Jan. 2011 – April 2011)         (May 2011-2013)

                     Over $1.7 million            Over $350,000            Over $2.1 million


Part of this Other Time waste resulted from Chief Judge 1’s instruction that the PTAB hire two
additional paralegals over the objection of the hiring managers. The PTAB paid these two
paralegals $44,581 total in Other Time wages. Beyond those Other Time wages, the PTAB
spent on these two individuals over $172,000 in bonuses and wages not directly related to
production between Fiscal Years 2009 and 2013. We note that this latter figure likely
underestimates the amount of waste related to the hiring of these two individuals, considering
that these two Paralegal Specialists’ productive hours could have been shifted to the other

521   Id.
522   Id.




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U.S. DEPARTMENT OF COMMERCE                                                      OFFICE OF INSPECTOR GENERAL


Paralegal Specialists, which would have therefore reduced those other paralegals’ Other Time
charges as well.

On the whole, the PTAB’s waste is especially troubling in light of the USPTO’s decision to
more than double the regular appeal fees. Essentially, many members of the public who used
the USPTO’s services, including the PTAB, paid more for those services while the PTAB wasted
millions of dollars employing and rewarding full-time personnel who had essentially been
working a part-time schedule.

       B. Although Aware of the Waste, Supervisors and Management Ignored the Problem
          and Even Rewarded the Employees Committing the Waste.

The evidence was clear that PTAB management was well aware of the volume of Other Time
being logged from Fiscal Year 2009 through Fiscal Year 2013. Yet, other than a few short-term
projects, management did not take action to rectify the problem and even continued to reward
the PTAB staff, from employees to upper management, with Outstanding ratings and significant
bonuses. Supervisory Paralegal Specialists and Senior Managers did not recognize their
responsibility to resolve this problem. One manager summed up the general attitude in telling a
Paralegal Specialist, “We can’t do anything about [the lack of work] . . . . ‘this is the situation
we’re in.’”523 It is deeply troubling that so many government officials, including some of the
senior-most executives in the organization, were aware of such pervasive waste and took little
– or no – action to fix it for nearly five years. Management did not even make an effort to
consistently monitor the amount of Other Time until late in Fiscal Year 2012, and not because
management was concerned about the amount of Other Time, but rather to “ensure the Board
would not be caught unaware when Judge output does again exceed paralegal capacity.”524

Given the large amount of Other Time, management should have at least considered how they
were rating their employees and refrained from paying the more than $560,000 in bonuses to
Paralegal Specialists between Fiscal Years 2009 and 2013. At a minimum, the PTAB should have
pro-rated the Paralegal Specialists’ bonuses based on the employees’ Other Time, as the PTAB
did in late 2013. And if PTAB management previously believed in prior years that it could not
have pro-rated or declined to pay bonuses to the Paralegal Specialists under the Labor
Agreement, they should not have rewarded the many levels of managers with bonuses, while
such waste was occurring on their watch.

Even if management had not been aware of the extent of the problem until September 2011,
nothing seemed to have substantially changed until after the OIG referred the whistleblower
complaints to the USPTO in early 2013. Moreover, after the OIG referred the complaints in
February 2013, no special projects were implemented to reduce the Other Time until May
2013. Worse, the first and principal special project eventually implemented was initially
described as “busy work” by the individual who proposed it and merely shifted nearly all of the
Other Time to another code, Legal Administration.


523   [REDACTED]
524   See USPTO Response, supra, at Ex. 7 (Official Statement of Senior Manager 5).




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      U.S. DEPARTMENT OF COMMERCE                                               OFFICE OF INSPECTOR GENERAL


Even assuming the 2013 special projects were originally designed to be legitimately helpful
projects, the fact that PTAB management failed to implement them earlier reflects poor
management and cost the PTAB millions of dollars in wasted funds. Once directed to develop a
plan to reduce Other Time to zero, it took mere hours for management to develop the list of
projects with which the Paralegal Specialists could occupy their free time. Yet, from 2009
through nearly half of 2013, the Chief Judges and their management team simply waited for the
end of the hiring freeze at some unknown date in the future to resolve the problem. The
evidence established that they expended efforts to push USPTO management to end that
freeze, which did not occur until December 2011, rather than address the growing Other Time
problem. But after three years, and spending more than $2.6 million on wages to paralegals for
logging Other Time from Fiscal Years 2009 to 2011, the Chief Judges and Senior Managers
should have taken other action to remedy this problem, particularly since most interviewed by
the OIG assumed that Paralegal Specialists were watching television, surfing the internet, and
pursuing other personal activities while being paid by the U.S. Government. Even Chief Judge 2
recognized in an internal memorandum that management “only took decisive action [regarding
use of Other Time] when the OIG referred the whistleblower complaints to the USPTO.”525

One example of this lack of effort is management’s failure to distribute the work more evenly
among teams despite the fact that some teams had far greater Other Time than others. PTAB
management also apparently failed to explore other options such as details or layoffs for the
teams who had extreme amounts of Other Time, sometimes as high as 66% in a given year. As
Chief Judge 2 recognized in July 2013, despite “long term work imbalances between groups, . . .
[management] seems never to have addressed these imbalances until recently.”526

Additionally, the Chief and Vice Chief Judges did not make efforts to use the many layers of
management to resolve the Other Time problem while the judges were busy developing and
preparing for the implementation of the AIA. The PTAB should have recognized that such a
task would take large amounts of time and ensured that other members of management were
still dealing with reducing the waste caused by the Other Time.

The OIG investigation revealed that individuals at all levels of management immediately
dismissed many solutions to the Other Time problem in 2011 because of an aversion to dealing
with the Union. Some managers were effectively paralyzed out of concern that the Union
would object to any idea they had to keep Paralegal Specialists busy. This again reflected poor
management. Whatever aversion some employees may have to Union negotiation should not
prevent managers from discussing possible options that may involve Union negotiation.

In addition, although PTAB managers characterized potential discussions with the Union as “a
huge obstacle”527 and “a stumbling block,”528 the evidence did not show that PTAB management
addressed this problem. Rather than evaluate its relationship with the Union, PTAB

525 OIG IRF: Review I of Electronic Documents Received from USPTO (October 25, 2013, Memorandum from Chief Judge 2 to
File).
526 Managing Judge 1 Documents #2, supra (emphasis omitted) (July 17, 2013, e-mail from Chief Judge 2 to Senior Manager 6 and

Managing Judge 1).
527 Chief Judge 1 Interview, supra, at Tr. 980-87
528 Senior Manager 2 Interview, supra, at Tr. 2157-63




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U.S. DEPARTMENT OF COMMERCE                                                 OFFICE OF INSPECTOR GENERAL


management largely ignored any problems, which is especially egregious in light of the large
amount of waste resulting from the logging of Other Time.

On some occasions, witnesses interviewed did not even know whether Union negotiation
would be necessary if they pursued a particular option to reduce Other Time and still stated
that they did not explore those options. For example, because the Labor Agreement expressly
provided that “[a]ll awards [we]re subject to budgetary limitations and [we]re paid at the
discretion of the [USPTO],” PTAB management should have explored whether it could have
declined to pay bonuses to all of the employees who were being paid full-time salaries to
essentially work part-time. Management also should have evaluated whether, under other
provisions of the Labor Agreement, the PTAB could have asked for volunteers to be
temporarily detailed to work on opinions until the PTAB could hire more judges. Management
may not have been required to give these employees more pay, a higher grade, or advertise a
new position to the public to make this change, contrary to the speculations of some
interviewed by the OIG. Given that multiple Paralegal Specialists expressed interest in doing
this type of work and managers believed a significant number of paralegals were overqualified
for their job, it seems likely that they could have more fully employed these Paralegal Specialists
while helping to reduce the backlog faster.529

Similarly, PTAB management apparently did not consider changing the paralegal PAP to account
for the volume of Other Time. Management seemed to have flexibility and authority to do so
under the Labor Agreement without Union negotiation. Yet only after the OIG sent the
whistleblower complaints to the USPTO for investigation did the PTAB endeavor to change the
PAP, albeit temporarily, to attempt to better reflect the performance of the paralegals, and pro-
rate the bonuses by the amount of Other Time.

Importantly, it seems that the current Chief Judge, his Vice Chiefs, and Senior Managers have
worked over the past year to effectively eliminate the amount of Other Time. We credit their
efforts, as they appear to have reduced the amount of time employees are being paid to do
nothing. However, management needs to continue to monitor the amount of administrative
time being logged, especially with respect to special projects. A high volume of administrative
time could indicate a waste issue, and, if so, management should examine whether it has too
many paralegals for the amount of available work and take action. Additionally, management
needs to ensure that it continues to assign worthwhile special projects to the paralegals during
slow periods, to ensure that they are not masking staffing and workflow problems with
meaningless busy work.

      C. Paralegal Specialists Likely Violated Telework Rules in Logging Other Time.

When teleworking, Paralegal Specialists have been required to be accessible and available during
work hours. As such, they have been required to respond to voicemail and e-mail in a timely
manner. Additionally, paralegals have been required to work on tasks directly related to their
job functions or as otherwise assigned by a supervisor. Furthermore, Paralegal Specialists have

529If management had reviewed the Labor Agreement they would have also found that it was indeed possible to shift Paralegal
Specialists to part-time status after they asked for volunteers and negotiated with the Union, if necessary.




REPORT #13-1077                                                                                                           71
      U.S. DEPARTMENT OF COMMERCE                               OFFICE OF INSPECTOR GENERAL


been required to ensure that personal responsibilities do not interfere with work duties.
Paralegal Specialists have participated in telework training programs and have understood that
they are not permitted, while on government time, to conduct such personal activities as
watching television, reading books, browsing the internet, performing work for other
organizations, and doing laundry and other household chores.

Nevertheless, the evidence established that Paralegal Specialists engaged in at least the following
personal activities while on government time:

               reading books;
               browsing the internet;
               shopping online;
               cleaning dishes;
               watching television;
               doing household chores;
               sending and receiving personal e-mail messages;
               using social media, such as Facebook;
               reading the news;
               reading magazines;
               making personal telephone calls; and
               performing volunteer work for a non-profit organization from home.

As noted above, Department of Commerce policies prohibit “[l]oafing, willful idleness, [and]
wasting time” and an “[a]ct of negligence or careless workmanship in [the] performance of duty
resulting in [a] waste of public funds or inefficiency.”530 We note that, while federal rules
generally permit de minimus use of government resources for personal reasons, the evidence
established that the activities described above exceeded such negligible usage. Therefore, it is
reasonable to conclude that Paralegal Specialists violated telework policies by engaging in these
activities and logging those hours under Other Time.

Regardless of whether these activities constituted a violation of Department of Commerce
rules, we found such conduct to be troubling. Any reasonable person should know that
extreme non-productivity for such extended periods of time is not acceptable, especially for a
federal employee whose wages are paid by the public. Moreover, the allegations that some
Paralegal Specialists gamed the system to avoid work, while ostensibly maintaining their
productivity and receiving bonuses, are deeply disturbing. Federal employees should be held to
a higher standard, and those that manipulated their work environment to dodge work and
artificially inflate their performance ratings should be disciplined accordingly. At the same time,
however, we recognize that PTAB managers laid the foundation for these problems, as the
managers were aware of the extensive amount of Other Time and believed, or had reason to
believe, that Paralegal Specialists conducted personal activities while on government time.



530   DOC Department Administrative Order 202-751, App. B.




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U.S. DEPARTMENT OF COMMERCE                                                        OFFICE OF INSPECTOR GENERAL


In light of the fact that the Paralegal Specialists did not have sufficient work to occupy a full-time
schedule, it is reasonable to conclude that their supervisors – the Supervisory Paralegal
Specialists – were also underworked. In fact, one such supervisor confirmed to the OIG that
she sat at her desk with nothing to do many days and that some of her peers were similarly
underworked. Supervisory Paralegal Specialists spend a significant portion of their time
correcting and assigning work, and evidence established that the amount of quality checking did
not increase during this time frame. While none of the Supervisory Paralegal Specialists
admitted to the OIG that they pursued personal activities during work hours, our review of the
evidence established that it is reasonable to conclude that many of them did not have sufficient
workloads to occupy full-time schedules.

      D. Paralegals and Managers Violated Regulations, Executive Orders, and Policies in
         Failing to Report the Waste.

Evidence showed that multiple levels of personnel at the PTAB knew that Paralegal Specialists
did not have enough work and knew how long that problem had persisted. Yet, except for the
whistleblower(s) who contacted the OIG, these employees, from the Paralegal Specialists to
PTAB’s highest executives, seemingly sat on their hands. They seemed to rest on their
impression, which the evidence supported, that everybody knew this was going on. Once they
had seen how many weeks and then months and then years of waste were occurring at the
PTAB, employees should have reported the waste to the highest of management and the OIG.

By failing to report the significant waste incurred by the PTAB when Paralegal Specialists were
being paid to not work, numerous PTAB employees appear to have violated various laws and
Department of Commerce policies. As noted above, Section 2635.101(b)(11) of Title 5 of the
Code of Federal Regulations states, “Employees shall disclose waste, fraud, abuse, and
corruption to appropriate authorities.”531 Additionally, Department of Commerce
Administrative Order 207-10 § 3.01 provides that

                    information indicating the possible existence of any of these
                    activities [which may constitute mismanagement, waste of funds,
                    abuse of authority, or a violation of law or regulation] is to be
                    reported to the OIG . . . . If a Department official or employee
                    has any question about whether a particular matter should be
                    reported to the OIG, the official or employee should contact the
                    [Principal Assistant Inspector General for Investigations] or the
                    OIG Hotline.532

Further, employees cannot argue that it was not their role to report this waste. The law is
clear: it is their duty to do so. In fact, courts have identified this regulation as an example of a


531 5 C.F.R. § 2635.101(b)(11); see also United States v. White Eagle, 721 F.3d 1108, 1116-17 (9th Cir. 2013) (“[A]ll government
employees[] ha[ve] a duty to ‘disclose waste, fraud, abuse, and corruption to appropriate authorities,’ codified in the Code of
Federal Regulations as a ‘[b]asic obligation of public service.’” (final alteration in original)); Exec. Order No. 12,674 § 101(k), 5
C.F.R. § 2635 (1989).
532 Dep’t of Commerce Administrative Order 207-10 § 3.01 (effective December 12, 2012).




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      U.S. DEPARTMENT OF COMMERCE                                                   OFFICE OF INSPECTOR GENERAL


“situation in which [an] employee is obligated to report the wrongdoing [even if] . . . not part of
the employee’s normal duties or the employee has not been assigned those duties.”533

We credit the whistleblower(s) who did come forward and fulfill their duties by reporting the
ongoing waste at the PTAB. Many other PTAB employees, however, clearly failed to fulfill their
obligations and let the waste continue unfettered.




533Huffman v. Office of Personnel Mgmt., 263 F.3d 1341, 1354 (Fed. Cir. 2001) (“For example, the regulations, 5 C.F.R. §
2635.101(b)(11), specifically require all employees to ‘disclose waste, fraud, abuse, and corruption to appropriate authorities.’”).




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U.S. DEPARTMENT OF COMMERCE                                    OFFICE OF INSPECTOR GENERAL



Chapter 4: Conclusions and Recommendations
  I.           Findings

As a result of the analysis described above, the OIG found that:

       (i)       the PTAB wasted millions of dollars by paying employees for non-productive time;

       (ii)      numerous PTAB Paralegal Specialists appear to have violated PTAB telework rules
                 by engaging in impermissible activities during official work hours for which they
                 received full pay;

       (iii)     PTAB management knew of the non-productive time, failed to address the problem
                 in a timely or effective manner, and even rewarded employees who had logged
                 extensive non-productive hours with performance bonuses; and

       (iv)      PTAB management started taking real measures to fix the problems only after the
                 OIG became involved.

 II.           Conclusions

Beyond the findings presented above, the OIG reached broader conclusions regarding the
management structure and the telework programs at the PTAB. It is deeply disturbing that,
despite the many layers of management at the PTAB and the fact that members at each level
knew of the Other Time problem, no manager took action or responsibility to resolve the
Other Time problem. Only after the whistleblowers brought this matter to the attention of
the OIG and the OIG forwarded the complaints to the USPTO for investigation did PTAB
management seriously address the issue. PTAB managers seemed to accept that someone up
the chain was aware of and content with their employees’ troublingly high volume of idle time.
Moreover, when efforts were made to develop projects for the Paralegal Specialists in late
2011, those efforts were generally feeble and short-lived. The highest-level PTAB managers
were preoccupied with preparing for AIA matters, which took significant time, and the many
layers of managers beneath them did not seem to actively take over the task of resolving the
Other Time problem.

In short, no one at the PTAB took ownership of the problem. As a result, PTAB’s management
was ill-equipped to resolve administrative problems – problems were not adequately
communicated up the chain and middle managers were not aware of their responsibilities to
resolve problems on their own initiative.

In addition, the OIG concluded that the nature of the PTAB telework programs exacerbated
the Other Time problems. First, the fact that the paralegals were not physically present in an
office environment likely masked the extent of the problem and enabled supervisors to look the
other way. Had the 38 to 51 Paralegal Specialists been in the office between Fiscal Years 2009




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     U.S. DEPARTMENT OF COMMERCE                                 OFFICE OF INSPECTOR GENERAL


and 2013 – when they were not working more than 23% of the time – perhaps the Other Time
problem would have been more obvious and undeniable.

Furthermore, we found that the telework programs did not foster adequate communication
between management, Paralegal Specialists, and Supervisory Paralegal Specialists. Paralegal
Specialists and Supervisory Paralegal Specialists were physically separated from each other and
senior management, as if each were on his or her own island. The paralegals largely
communicated with their supervisors only when they had questions. The many years of
confusion over critical questions – such as when Paralegal Specialists were permitted to log
Other Time, whether they had to inform their supervisors if they were out of work, whether
they had to ask for permission to log Other Time, how much Other Time they could log, and
when they could work each day – largely could have been resolved through more direct, face-
to-face communication, or at least more regular check-ins or team conference calls.

Furthermore, the OIG concluded that, although PTAB management recognized the strengths
and skills of some of their Paralegal Specialists, they failed to practically apply their strengths
and skills by providing the Paralegal Specialists with work best suited for their abilities. PTAB
management should have at least explored whether those Paralegal Specialists could have
helped to reduce the backlog in other ways beyond creating eWFs and editing opinions when
they trickled in. In fact, some paralegals stated clearly that they would be interested in taking
on additional responsibilities. More broadly, the PTAB should consider how best to use its
Paralegal Specialists, and whether differing duties, and thus differing grades, are appropriate.

 III.     Recommendations

        A. Recommendation 1

The PTAB should institute clearer telework rules, including what types of activities are
permissible and impermissible on official duty. The PTAB should provide regular training to all
teleworking employees and their supervisors on those rules. Additionally, the PTAB should
review the effectiveness of all of its telework programs and determine whether they are
appropriate for the work of the organization.

        B. Recommendation 2

The PTAB should continue to reexamine its management structure to determine whether it is
most efficient and effective to have so many layers of management overseeing paralegal
operations.

        C. Recommendation 3

The PTAB should examine the workloads of the Paralegal Specialists and Supervisory Paralegal
Specialists on a regular basis and implement a process to readjust workforce assignments,
among other things, if employees have insufficient workloads.




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U.S. DEPARTMENT OF COMMERCE                                OFFICE OF INSPECTOR GENERAL


    D. Recommendation 4

The PTAB should review the Labor Agreement for efficiency and effectiveness and insist on
implementing policies or even modifying terms as necessary to prevent waste and abuse of
government resources.

    E. Recommendation 5

The PTAB should analyze and determine the best use of its Paralegal Specialists and whether
some are better suited to working on different tasks than others. Along these lines, the PTAB
should explore advancement opportunities for Paralegal Specialists and whether Paralegals
Specialists need to be classified at different GS levels based on their skills and experience.

    F. Recommendation 6

The PTAB should provide consistent directions to its employees, including managers – ranging
from how many documents supervisors should review each month to how to use particular
time codes and what to do when they have insufficient workloads.

    G. Recommendation 7

The PTAB should continue to examine how to incentivize judges to submit opinions
throughout the months and fiscal year, so that they do not continue to submit the majority of
their decisions at the end of the months and at certain times of the fiscal year. For example,
the PTAB could consider assigning judges staggered due dates such that some judges submit
their decisions at one point of the month and others at another point.

    H. Recommendation 8

The PTAB should provide additional training to its entire staff, including managers, on the
importance of disclosing waste, fraud, abuse, and mismanagement to appropriate authorities,
such as the OIG. In doing so, the PTAB should notify employees that federal law imposes a
duty on employees to disclose such waste and inform them of whistleblower protections for
such disclosures.

    I.   Recommendation 9

The PTAB should consult with the USPTO, legal counsel, and the Union and implement a plan
to recover, on a voluntary or mandatory basis as legally permissible, bonuses paid to Paralegal
Specialists and Supervisory Paralegal Specialists during Fiscal Years 2009 to 2013. The PTAB
should particularly focus on all instances in which an employee did not meet the eligibility
requirements of working 1,250 non-Other Time hours per year for a full bonus and between
600 and 1,250 non-Other Time hours for a pro-rated bonus. If an employee received a full
bonus but was only eligible for a pro-rated bonus, the difference between the full and pro-rated
bonus may be an improper payment. If an employee received any bonus for which he or she




REPORT #13-1077                                                                                  77
     U.S. DEPARTMENT OF COMMERCE                           OFFICE OF INSPECTOR GENERAL


was not eligible based on hours or rating, the entire bonus may be an improper payment. The
PTAB should recover all improper payments.




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                                                                               APPENDIX A

1. USPTO Structure 1

                                                    Under Secretary of Commerce for Intellectual Property and
                                                    Director of the United States Patent and Trademark Office

                                               Deputy Under Secretary of Commerce for Intellectual Property and
                                               Deputy Director of the United States Patent and Trademark Office




                                                           Patent
                                                             Trial Trial and
                                                            Appeal Board




1   USPTO, http://www.uspto.gov/about/bios/uspto_org_chart.pdf (emphasis added) (last visited July 25, 2014).

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II. Partial PTAB Organizational Chart (as of October 4, 2009) 2




2   Senior Manager 1 Interview, supra, at Ex. 1 (redactions applied by the OIG).

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                                                                                                OFFICE OF THE CHIEF JUDGE
            III. Partial PTAB Organizational Chart 3                                                    Chief Judge
                                                                                                    Deputy Chief Judge                                              Patent Attorney, Patent
                                                                                                                                                                Attorney, Special Asst, Paralegal
            (effective March 27, 2014)                                                                                                                                     / OCJ Asst



                                         JUDGES & ATTORNEYS OF THE                                                                                    JUDGES & ATTORNEYS OF THE
                                                                                                BOARD OPERATIONS DIVISION
                                             BOARD – DIVISION 1                                                                                           BOARD – DIVISION 2
                                                                                                      Board Executive
                                                Vice Chief Judge                                                                                             Vice Chief Judge




                   Section 1                   Section 5               Section 9                                            Section 2               Section 6                Section 10                Section 14




                                 Section 3                 Section 7               Section 11                                           Section 4                Section 8                Section 12


                                                                                                                          Data Analysis &             Administrative
                                                      IT Systems &         Executive Support       Case Management
                                                                                                                              Process                 Management
                                                     Services Branch            Branch                  Branch
                                                                                                                        Improvement Branch               Branch




                                                                                        Hearing Operations      Paralegal Operations


                                             Paralegal Ops Team 1                                                                                               Paralegal Ops Team 2

                                             Supervisory Paralegal                                                                                              Supervisory Paralegal
                                                  Specialist                                                                                                         Specialist




Appeal Support 1               Appeal Support 2              Appeal Support 3           Appeal Support 4             Appeal Support 5               Appeal Support 6              Trial Support                     Review



            3   Paralegal 2 Documents, supra (redactions and emphasis applied by the OIG).

            3                                                                                                                                                                                       REPORT #13-1077