IP in the Reform Era 2011: Torrents of Change Under Way – How Can You Keep Your Equilibrium in...

IP in the Reform Era 2011: Torrents of Change Under Way – How Can You Keep Your Equilibrium in Check?

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Carolina Patent Trademark & Carolina Patent Trademark & Copyright Law AssociationCopyright Law Association

The 2011 Patent LawThe 2011 Patent Law

Harold C. Wegner*

Foley & Lardner LLP

Isle of Palms, South CarolinaIsle of Palms, South Carolina

September 23-24, 2011September 23-24, 2011

*Biographical information at the last page


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The 2011 Patent LawThe 2011 Patent Law The New Substantive Patent Law The New Substantive Patent Law

of Leahy Smith America Invents Act: of Leahy Smith America Invents Act:

A Discussion of Substantive A Discussion of Substantive Patentability Requirements under Patentability Requirements under

the New Lawthe New Law


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Six Goals from the Administration’s Viewpoint

(1) First-to-File and Prior Art Harmonization

(2) Cutting the Backlog

(3) Quality Control:Procedures to Weed out Invalid Patents

(4) Best Mode

(5) Qui Tam False Marking Suits(6) Limiting Inequitable Conduct Claims


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Six Goals

(1) First-to-File and Prior Art Harmonization• Patent law changes were the primary driving force

at the start of the legislative process.(Because the substantive patent law changes are the most important ones for daily ex parte patent practice, they are the major focus of this presentation.)


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Six Goals


• Administration’s major point pushing this bill has been the need to sharply cut into the backlog by gaining greater funding, including 100 % retention of “user fees”.

• Reality is that as a result of “debt ceiling” legislation, across the Board cuts will be made in funding for most government programs, including Patent Office.


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Six Goals


• Even with unlimited funding, patent backlog of 1.2 million pending cases and 700,000-plus unexamined cases creates a “dead zone” where it is impossible to simply hire thousands of examiners because of high turnover rates, inexperienced examiners and “churning” of RCE/continuing application refilings.


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Six Goals


• Only realistic solution is to find incentives to discourage (a) premature final rejections by examiners; and (b) refilings by applicants.

• Nothing in the new patent law deals with these solutions.


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Six Goals

(3) Weeding out Invalid Patents – Post-Grant

a) Post Grant Review: Attacks possible on non-publication prior art; must be filed within 9 months from grant.

b) Inter Partes Review – Enhancement of the current inter partes examination.


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Six Goals


• “Patent Trial and Appeal Board” is the new name for the Board of Appeals which will continue to handle everything it has before, e.g., appeals from Examiners, but also the new post-grant load of proceedings.


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Six Goals


• The Board has been unable to handle its current workload of appeals from the Examiners:

• Backlog in 2005, essentially zero backlog.

• Backlog in 2011, approaching 25,000 cases awaiting decision.



Six Goals

(3) Weeding out Invalid Patents – Post-Grant• Trial Board is charged with handling all post-grant

reviews, but there is no capacity at the Board to do even its existing work of appeals from examiners.

• Backlogs in post-grant review procedures are expected.



Six Goals

(3)Weeding out Invalid Patents – Post-Grant “inter partes review”Petitioner may challenge validity on any ground

of patentability (e.g. novelty, obviousness, lack of enablement, subject matter eligibility).

Must be filed within 9 months of patent issue, or reissue, or conclusion of post grant proceedings.

Evidence must demonstrate that it is more likely than not that at least one claim is unpatentable.



Six Goals

(3)Weeding out Invalid Patents – Post-Grant “inter partes review”Must be completed within 1 year (6 month

extension for good cause).Backlogs in post-grant review procedures are

expected.Petitioner and privies are barred in the future

from raising issues that were “raised or reasonably could have been raised.”



Six Goals

(3) Weeding out Invalid Patents – Pre-Grant

• Pre-issuance submission of prior art including comments is permitted and encouraged.

• If there is effective rulemaking, this could prove to be a major improvement in the system.

• This change is effective one year from enactment.



Six Goals

(3) Weeding out Invalid Patents – Pre-Grant• Submit patent documents or printed publications to

USPTO within the later date of either:– The date the USPTO issues a notice of allowance. – Either six month after the date of pre-grant publication or

the application, or date of first rejection of any claim by examiner.

– Submission must include a concise description of the asserted relevance of each submitted document.



Six Goals

(4) Best Mode

• Invalidity penalty for violation of “best mode” requirement is eliminated as of the date of enactment, retroactive for existing applications on file and granted patents.

• Exception: Change in the law does not apply to ongoing litigation.



Six Goals

(5) Qui Tam False Marking Suits• Qui tam false marking lawsuits are retroactively

abolished. • The change in the law “shall apply to all cases, without

exception, that are pending on, or commenced on or after, the date of the enactment….” Leahy Smith Sec. 16(c)(4).



Six Goals

(6) Supplemental Examination—Limiting Inequitable Conduct Claims

Patent owner may request a “supplemental examination” to consider, reconsider, or correct information believed to be relevant to the patent

USPTO Director must determine that the material raises a substantial new question of patentability



Six Goals

(6) Supplemental Examination—Limiting Inequitable Conduct Claims (con’d)– Request and reexamination must occur prior to

the start of litigation to obtain the benefit– Patent shall not be held unenforceable on basis

of conduct relating to information if material is submitted during supplemental examination– Proceeding would allow a patent acquired Proceeding would allow a patent acquired

through inequitable conduct to be rendered through inequitable conduct to be rendered enforceableenforceable


Patent Defeating EventsSubstantive Expansion of Prior Art

• The major changes to the substantive patent law are found in the definition of prior art in 35 USC § 102




Patent-Defeating Events

New 35 USC § 102(a)(1)Replaces current §§ 102(a), 102(b)

• “A person shall be entitled to a patent unless… the

claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention[.]”



Patent-Defeating Events – Printed Publication

• Current Law: “[P]rinted publication” is the principal patent-defeating category for any public dissemination of the invention encompassing, e.g., internet disclosure, posterboard at convention, etc.; with no geographic restriction.

• Change from Current Law: None.

• Grace Period: “[P]rinted publication” is a grace period “disclosure”



Patent-Defeating Events – Public Use

• New Law: “in public use … before the effective filing date of the claimed invention”.

• Current Law: “in public use …in this country, more than one year prior to the [filing] date”.

• “Public use” bar started with Pennock v. Dialogue, 27 U.S. (2 Pet.) 1 (1829).




Changes: (1) immediate bar (vs. current one year)(2) no geographic limitation (vs. current domestic

only)• Grace Period: Is “public use” a grace period

“disclosure”?Open Question!




• Secret Commercialization by the Inventor bars the Inventor:Secret commercialization anywhere in the world by the inventor is a patent-defeating event versus the inventor.

• Test case to determine continued viability of secret commercialization as prior art.

• Change from Current Law: Secret commercialization has no geographic limit (versus current domestic restriction)



Patent-Defeating Events – “On Sale”

• New Law: “on sale… before the effective filing date of the claimed invention”

• Current Law: on sale in this country, more than one year prior to [filing]”

Changes: (1) immediate bar (vs. one year)• (2) no geographic limitation (vs. domestic only)• Grace Period: Is “on sale” a grace period

“disclosure”?




• “On Sale” basis to deny patent started with 1837 law.

• Long history of case law which will be used to interpret meaning of “on sale” under the new law.

• “On Sale” does not require a sale; “on sale” bar requires only commercial offer of sale, not completed transaction.




• Invention can be “on sale” even before reduction to practice.

• Requires look at “totality of the circumstances.”

• Supreme Court has said bar happens if invention is “ready for patenting”. Pfaff v. Wells Elecs., Inc., 525 U.S. 55 (1998).

• “Ready for patenting” means sufficient disclosure, drawings, to write a valid patent for the invention.



Patent-Defeating Events – “Patented”

• Current Law: “[P]atented…in this or a foreign country….”

• Change from Current Law: None.

• Grace Period: “[P]atented” is a grace period “disclosure”



Patent-Defeating Events – “Patented”

• “Patented” is largely meaningless as a prior art category because any “patented” invention will also be prior art as a “printed publication”.

• “Patented” is narrower than “printed publication” because “patented” bar relates only to what is claimed (versus what is disclosed) in the document.



Patent-Defeating Events – “Otherwise Available”

• New Law bars patent if “claimed invention was…was…otherwise available to the publicotherwise available to the publicbefore the effective filing date of the claimed invention.”

• No counterpart in current law.



Patent-Defeating Events – “Otherwise Available”

• This provision is largely redundant in view of broad interpretation given to “printed publication.”

• This provision is added as a safeguard against new forms of making invention available to the public.



Earlier Filed Application

35 USC § 102(a)(2)

• New Law: “described … in a [published] application … …nam[ing] another inventor”

• Current Law: ““described in…[a published] application… by another”




Hilmer Overruled

• Patent-defeating date is foreign priority date under new law, 35 USC §102(d)(2).

• This legislatively overrules old law established in In re Hilmer, 359 F.2d 859 (CCPA 1966)(Rich, J.).




Obviousness Effect

• In United States patent-defeating date as of the effective filing date is for novelty and obviousness determinations.

• In Europe ad Japan, patent-defeating date retroactive to filing date is only for novelty purposes.



Earlier Filed ApplicationSix Exceptions

No. (1):• No patent-defeating effect for prior-filed later-

published application for disclosure “obtained directly or indirectly from the inventorfrom the inventor.” § 102(b)(2)(A)




No. (2): • There is no patent-defeating effect for prior-filed later-

published application for disclosure “obtained directly or indirectly from a joint inventorfrom a joint inventor.” § 102(b)(2)(A)




No. (3): • There is no patent-defeating effect for prior-filed

later-published application for disclosure “publicly disclosed by … another who obtained the subject another who obtained the subject mattermatter disclosed directly or indirectly from the inventorinventor.” § 102(b)(2)(B)




No. (4):• There is no patent-defeating effect for prior-filed

later-published application for disclosure “publicly disclosed by … another who obtained the subject another who obtained the subject matter matter disclosed directly or indirectly from …a joint joint inventorinventor.” § 102(b)(2)(B)




No. (5): • There is no patent-defeating effect for prior-filed

later-published application where “subject matter and the claimed invention, not later than the effective filing date of the claimed invention… [were] owned by the same personowned by the same person….” § 102(b)(2)(C)




No. (6): • There is no patent-defeating effect for prior-filed later-

published application where subject matter was “made by… parties to a joint research agreement joint research agreement … in effect [by] the effective filing date.”§ 102(c)(1)



“Joint Inventor” Status to Avoid Prior Art

• The statute permits avoidance of prior art under 35 USC § 102(a)(1) if the inventor of relatedrelatedsubject matter is named as a “joint inventor.”



“Joint Inventor” Status to Avoid Prior Art

• If claims and disclosure of a second inventor are added to the application the second inventor becomes a “joint inventor” under the provisions of 35 USC §§ 100(f), 100(g), 116(a)(1), 116(a)(3).

• After initial filing without “joint inventor” continuation-in-part can be filed to combine full disclosures of both applications and claims of both applications and with inventor nomination of both.



“Joint Inventor” Status Four Definitions

(1) “The term ‘inventor’ means the individual or, if a joint invention, the individuals collectively who invented or discovered the subject matter of the invention.” § 100(f)

(2) “The terms ‘joint inventor’ and ‘coinventor’ mean any 1 of the individuals who invented or discovered the subject matter of a joint invention.” § 100(g)




Current law without definition of joint inventorship says joint inventors must have “some quantum of some quantum of collaborationcollaboration.” Kimberly-Clark Corp. v. Procter & Gamble Distributing Co., Inc., 973 F.2d 911, 917 (Fed. Cir. 1992)(Lourie, J.). “There is ‘no explicit lower limit on the quantum…’” Vanderbilt University v. ICOS Corp., 601 F.3d 1297, 610 (Fed. Cir. 2010)(Clevenger, J.).




Current law (maintained in new law)

(3) “Inventors may apply for a patent jointly even though … they did not physically work together or at the same time.” § 116(a)(1)

(4) “Inventors may apply for a patent jointly even though …each did not make a contribution to the subject matter of every claim of the patent.” § 116(a)(3)


Impact on Patent Litigation

• Expands scope of patent defeating prior art.• Eliminates litigation disputes (and resulting discovery

and costs) over “who was first to invent” (except in cases of derivation).

• Provides alternative avenue to court to challenge patent validity with lesser burden of proof.

• Provides additional methods for submission of prior art to PTO prior to patent issuance.




Acknowledgment:This presentation incorporates a modification of

the “Six Goals” material jointly previously presented with Sharon R. Barner.


HAROLD C. WEGNER HAROLD C. WEGNER retains his affiliation with the George Washington University Law School where he had been Director of the Intellectual Property Law Program and Professor of Law. His patent career commenced with service at the U.S. Department of Commerce as a Patent Examiner. Prof. Wegner is a graduate of Northwestern University (B.A.) and the Georgetown University Law Center (J.D.), where he launched his teaching career as an Adjunct Professor of Law teaching International Licensing.

The views expressed in this presentation are those of the author and do not necessarily reflect the views of any colleague, organization or client thereof.

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IP in the Reform Era 2011: Torrents of Change Under Way – How Can You Keep Your Equilibrium in...

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