The Leahy-Smith America Invents
Act: Changes to United States Patent
Law and Practice
Charles E. Miller
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#2988628
Stated Objectives of Patent Reform
• Improve quality of patents granted by the PTO
• International harmonization of patent laws
• Early determination of rights
• Reduce patent litigation costs and risks of “alleged
infringers”
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Summary of Changes
• Patent Law
• Post Grant Procedures
• Litigation Related
• PTO Practice, Operations, Fees and Funding
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Patent Law
• First Inventor to File
• Grace Period for Inventor Disclosure
• Definition and Scope of Prior Art
• Derivation Proceedings
• Bar to Patents Covering Certain Subject Matter
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First Inventor to File
• The Act eliminates first-to-invent system
• Patent awarded to first inventor to file
• Priority is based on application filing dates
– Effective March 16, 2013
– Adoption of the First-to-File system is not conditioned on
adoption by Europe and Japan of a U.S. style 1 year grace
period
• Interference proceedings are abolished
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Grace Period For Inventor Disclosure
• The Act includes a 12-month grace period prior to the
“effective filing date” (i.e., the earliest priority date) for
public disclosures by an inventor or by another who
obtained the subject matter from the inventor
• Public disclosure during the 12-month grace period by
another party who did not obtain the subject matter from
the inventor will not prevent the inventor from obtaining a
patent ONLY IF the inventor made a public disclosure of
the subject matter first
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Definition and Scope of Prior Art
• “Public use” and “on sale” activities in any country are
prior art – not just public use or on sale in the U.S.
• These public use and on sale activities are prior art only
if they are disclosures of the claimed invention
• U.S. patents and published patent applications of other
persons (i.e., different listed inventors) are prior art as of
their earliest claimed priority date
– When a U.S. patent or patent publication listing different
inventors is owned by the same person or subject to assignment
to the same person as of the earliest claimed priority date of the
claimed invention, that U.S. patent or patent publication is not
prior art under new §102(a)(2).
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Definition and Scope of Prior Art (continued)
Priority Date
Disclosures before the Priority Date are
prior art, with three exceptions:
1. An inventor’s own direct or indirect
public disclosure and/or sales within
1 year before the Priority Date;
2. Third party disclosures within 1 year
before the Priority Date ONLY IF the
inventor publically disclosed the
invention before the third party
disclosure; and
1 year before
Priority Date
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3. Third party disclosures within 1 year
before the Priority Date IF that third
party disclosure was obtained
directly or indirectly from the inventor
Derivation Practice
• Effectively replaces current interference practice
• Two types:
– patent v. patent: civil action
– published application v. published application: PTO
• A civil action must be filed within 1 year from the issuance of the first
patent (1) containing a claim to the allegedly derived invention and
(2) naming as an inventor an individual alleged to have improperly
derived such invention
• A derivation proceeding in the PTO must be filed within 1 year from
the first publication (1) containing a claim to an invention that is the
same or substantially the same as the earlier application’s claim to
the invention; and (2) naming as an inventor an individual alleged to
have improperly derived such invention
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Derivation Proceeding in the PTO
• The PTO will prescribe what is sufficient evidence
required to prove and rebut a claim of derivation
• If an inventor in an earlier application is found to have
derived the invention from the true inventor, then claims
in the earlier application will be refused or cancelled
• Parties in a derivation proceeding in the PTO can
settle/arbitrate any claims of derivation
– Must provide a copy of the settlement agreement to the PTO
– Must notify PTO of arbitration award to make arbitration award
enforceable
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Bar to Patents Covering Certain Subject
Matter
• Any patent filed that has a claim covering any strategy
for reducing, avoiding, or deferring tax liability is deemed
insufficient to differentiate a claimed invention from the
prior art
• This does not apply to (1) systems and methods for
preparing a tax filing or organizing that data; and (2)
methods and systems for financial management
• Patents with a claim directed to or encompassing a
human organism are not permitted
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Post Grant Procedures
• Ex parte Reexamination
• Supplemental Examination
• Post Grant Review
• Inter partes Review
• Review of Business Method Patents
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Ex parte Reexamination
• Ex Parte Reexamination procedures will remain in effect
• Can be filed by anyone, including patent owner
• Can only cite patents or printed publications as prior art
• The current threshold of “substantial new question of
patentability” will continue
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Supplemental Examination
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•
Only patent owner can initiate procedure, and any grounds can be raised
as a basis for the request
•
Purpose is to permit the PTO to consider, reconsider, or correct information
believed by the patentee to be relevant to the patent
•
Can be used to purge inequitable conduct and unenforceability claims,
except those that pled with particularity in a civil action before the filing of
the Supplemental Examination request
•
Threshold is whether a substantial new question of patentability has been
raised
•
The mere fact that a request for Supplemental Examination was or was not
filed can not be used as relevant to enforceability of a patent
•
If PTO becomes aware of fraud, the matter may be referred (confidentially)
to the Attorney General for further investigation
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Post Grant Review
• Person who is not patent owner may petition for review of a patent
within 9 months from patent grant (similar to European Opposition
Proceeding)
• Grounds for invalidity are any that can be raised against a patent in
court
• Post grant review will be granted if it is “more likely than not” that at
least one of the claims challenged is unpatentable, or if the petition
raises a “novel or unsettled legal question” that is important to other
patents
• Petitioner has the burden of proof by a preponderance of the
evidence
• Patent owner has right to file preliminary response to petition
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Post Grant Review (continued)
• Post Grant Review to be completed within 1 year and conducted
before a newly formed Patent Trial and Appeal Board
• Petitions for Post Grant Review are not allowed if the petitioner
challenged the validity of the patent in court prior to filing the
petition, and any civil action filed by petitioner after filing petition for
Post Grant Review is automatically stayed
• If a civil action is filed within 3 months from the date patent grant,
the court can not stay a decision on a patent owner’s motion for a
preliminary injunction
• Petitioner can not raise issues in a civil action that were or could
reasonably have been raised in the Post Grant Review proceeding
once a final written decision of the Patent Trial and Appeal Board is
issued
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Post Grant Review (continued)
• If multiple parties file petition for Post Grant Review for the same
patent, then those petitions may be consolidated in a single review
• Limitation on Post Grant Review for reissue patents that have
claims of the same or narrower scope than the original patent
• Appeal of final decision can only be taken to the Federal Circuit
• Post Grant Review can be settled, but a copy of the settlement
agreement, and any agreements mentioned in the settlement
agreement, must be filed with the PTO
– Agreement may be treated as confidential business information at the
request of “a party”
• Intervening rights apply to any amendments made to the claims,
and amendments can not be broadening
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Inter Partes Review
• Person who is not patent owner may petition for review of a patent
the later of (1) 9 months after patent is granted or (2) the date of
termination of a Post Grant Review proceeding
• Grounds for invalidity limited to novelty and nonobviousness based
on prior art consisting of patents and printed publications
• Inter partes Review will not be granted unless “reasonable
likelihood” that petitioner would prevail with respect to at least one
claim (slightly raised threshold from that of Post Grant Review)
• Patent owner has right to file preliminary response to petition
• Inter Partes Review to be completed within 1 year and conducted by
the Patent Trial and Appeal Board
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Inter Partes Review (continued)
• Petitions for Inter partes Review are not allowed if the petitioner
challenged the validity of the patent in court prior to filing the
petition, , and any civil action filed by petitioner after filing petition for
Inter partes Review is automatically stayed
• A petition for Inter partes Review is also not allowed if the petition is
filed more than one year after the date on which the petitioner is
served with a complaint alleging infringement of the patent
• Petitioner can not raise issues in a civil action that were or could
reasonably have been raised once a final written decision of the
Patent Trial and Appeal Board is issued
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Inter Partes Review (continued)
• Appeal of final decision can only be taken to the Federal
Circuit
• Inter Partes Review can be settled, but a copy of the
settlement agreement, and any agreements mentioned
in the settlement agreement, must be filed with the PTO
– Agreement may be treated as confidential business information
at the request of “a party”
• Intervening rights apply to any amendments made to the
claims
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Summary of Post Grant Procedures
Ex Parte
Reexam
Supplemental
Examination
Post Grant
Review
Inter Partes
Review
Who can
file?
anyone
patent owner
third party only
third party only
Basis
patents and printed
publications
any grounds
any grounds
patents and printed
publications
Threshold
substantial new
question of
patentability
substantial new
question of
patentability
(1) more likely than
not or (2) novel or
unsettled legal
question
reasonable
likelihood
any time after
grant
within 9 months
from patent grant
later of 9 months
after grant or date
of termination of a
Post Grant Review
none
yes – issues that
were or could have
been raised
yes – issues that
were or could have
been raised
Timing
Estoppel
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any time after
grant
none
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Review of Business Method Patents
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•
A “transitional” post-grant review proceeding for review of the “covered”
business method patents, and which take effect September 16, 2012 and
expire 8 years thereafter
•
A “covered” business method patent is a patent that claims a method or
apparatus for performing data processing or other operations used in the
practice, administration, or management of financial products or services. It
does not include patents for “technological inventions.”
•
Petitioner must be the real party in interest that has been sued or charged
with infringement under the patent
•
Proceedings are same as Post Grant Review and are conducted by the
Patent Trial and Appeal Board
•
Petitioner can not raise issues in a civil action that were or could reasonably
have been raised in the proceeding once a final written decision of the
Patent Trial and Appeal Board is issued
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Litigation Related Changes
• Joinder
• Prior User Rights
• Marking and False Marking
• Best Mode
• Advice of Counsel
• Litigation Against the USPTO
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Joinder
• Parties that are accused infringers may be joined in one
action only if:
– the parties relate to the same accused product or process;
and
– common questions of fact will arise for all defendants
• Basis for joining unrelated parties can not just be
because they all are alleged to infringe the same patent
• Can be waived by an accused infringer
• Applies to all civil actions filed on or after September 16,
2011
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Prior Commercial Use Rights
• A prior commercial use rights defense is available
against all patents, not just business method patents
• Prior commercial use
– Must have been in the U.S.
– Occurred at least 1 year before the earlier of (1) the earliest
claimed priority date, or (2) the earliest public disclosure of the
claimed invention that qualifies for the prior art “grace period”
exceptions
• Person asserting prior commercial use defense has the
burden of establishing the defense by clear and
convincing evidence
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Prior Commercial Use Rights (continued)
• Defense is available for premarketing regulatory reviews and
nonprofit laboratory use
• Defense is not available if patent was owned by a university
• Defense is personal, non-assignable or licensable, unless with the
entire business
• If assigned with entire business, then continued commercial use is
only permitted at same sites used the earlier of (1) the earliest
priority date or (2) the date of assignment
• Defense can not be used if the subject matter of the prior
commercial use was derived from the patentee
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Prior Commercial Use Rights (continued)
• Defense is not a general license to all claims in the patent, but only
the specific subject matter of the prior use
• Abandonment of the commercial use shuts off defense as of the
date of abandonment
• If defense is asserted without a reasonable basis for doing so and
person asserting the defense is found to infringe the patent, then
case will be deemed exception for purposes of awarding attorney
fees to other party
• Patent is not invalid on this basis alone if defense is proven
• Applies to any patent issued on or after enactment
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Marking and False Marking
• The Act eliminates qui tam lawsuits for false patent
marking
• Only the US can sue for the statutory penalty
• Private parties can sue for damages, but this requires
proof of a competitive injury
• Not false marking if product was covered by a nowexpired patent
• Changes are in effect now, includes pending cases
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Best Mode
• Eliminates an alleged infringer’s ability to argue that the
patent owner did not identify the best mode for
enablement in the patent specification
• The PTO retains the ability to reject an application for
lack of best mode disclosure
• These changes are in effect now
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Advice of Counsel
• Failure to obtain advice of counsel with respect to any
alleged infringed patent, or failure to present such advice
in defense in a civil action, can not be used to prove
willful infringement or intent to induce infringement
• Obtaining advice of counsel can still help in defeating a
claim of willful infringement or intent to induce
infringement
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Litigation Against the USPTO
• The location of litigation against the USPTO is changed
to the U.S. District Court for the Eastern District of
Virginia from the U.S. District Court for the District of
Columbia
• Eliminates the right of de novo review of PTO
reexamination decisions in the U.S. District Court for the
District of Columbia – direct appeal to Federal Court will
be the sole means of judicial review
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PTO Practice, Operations, Fees and
Funding
• Prioritized Examination
• Inventor Oath and Assignee Filing
• Pre-issuance Submissions of Prior Art
• PTO Fees
• New Micro Entity Status
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Prioritized Examination
• The PTO is to “provide for prioritization of examination of
applications for products, processes, or technologies
that are important to the national economy or national
competitiveness without recovering the aggregate extra
cost of providing such prioritization.”
• Directed towards so-called “green technologies”
• Additional $4,800 fee (50% discount for small entities)
• Goal is to provide a first substantive response from the
PTO within 12 months of patent application filing
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Inventor’s Oath and Assignee Filing
• Employers and other assignees may file patent
applications without declarations executed by the named
inventors
• An inventor oath or declaration would be required before
issuance of a notice of allowance
• Can provide a substitute to the inventor oath or
declaration if the inventor is under obligation to assign,
but refuses or can not otherwise sign
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Pre-issuance Submissions of Prior Art
• Any third party may submit written prior art for
consideration and inclusion in the record
• Written submission must be before the earlier of
– the date of allowance
– six months after the publication of the application
– the date of the first rejection of any claim
• Practically, there will be a 6 month window from
publication for filing any written submission, unless you
otherwise are aware of the application and can submit
earlier than publication date
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PTO Fees
• Gives permission for the PTO to set and adjust its fees
• There will be a 15% surcharge on almost all fees,
including maintenance fees, effective September 26,
2011
• Implements a $400 fee for non-electronic filing
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Micro-Entity Status
• The Act also establishes a new “micro entity”
• A micro entity is entitled to a 75% discount of many PTO
fees.
• Micro entity is generally a person who is employed by an
institution of higher education, or has not been named
on more than 4 prior applications and meets certain
income requirements
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Summary of Effective Dates
Topic
Joinder of Accused Infringers
Micro-Entity Status
Prioritized Examination
Inter Parte Reexamination Threshold Change
Virtual Marking
False Marking Actions Limited
Best Mode Issue
Venue Change
Business Methods
Priority Examination
Fee Increase
Inter Partes Reexamination
Abolished
Advice of Counsel
Post-Grant Review
Inter Partes Review
First-to-File
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Effective Date
September 16, 2011
September 16, 2011
September 16, 2011
September 16, 2011
September 16, 2011
September 16, 2011
September 16, 2011
September 16, 2011
September 16, 2011
September 16, 2011
September 26, 2011
September 16, 2012
September 16, 2012
September 16, 2012
September 16, 2012
March 16, 2013
Thank you
Dickstein Shapiro LLP
1633 Broadway
New York, NY 10019
Tel No. (212) 277-6559 | Fax No. (212) 277-6501
Charles E. Miller
millercharles@dicksteinshapiro.com
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