Patent Law Changes May Necessitate Filing Applications by March 15, 2013

Intellectual Property Update

Date: January 24, 2013


March 15, 2013 is a potentially important due date for filing U.S. patent applications. Applications filed by that date are entitled to benefits under existing U.S. patent law. The America Invents Act (AIA) makes changes to the law, effective on March 16, 2013 for applications filed on or after March 16, which can prevent or limit claims for patent protection. Companies considering patent protection for new technology or modifying patent protection for existing technology (such as by filing non-provisional or continuation-in-part applications based in part on earlier filed applications), should consider taking steps to protect the technology immediately. Those planning to seek assistance from legal counsel in preparing patent applications for filing by March 15 should act quickly since drafting and filing a patent application typically requires several weeks of preparation, including communication with inventors.

Potential Consequences of Waiting
Change to First-Inventor-to-File System

The United States will significantly alter the country's patent policy when it changes from a first-to-invent patent system to a first-inventor-to-file system on March 16. A patent applicant who files an application by March 15 may still rely on his or her date of invention to avoid prior art and win an inventorship contest. This opportunity will be unavailable to owners of applications filed on or after March 16, as their priority dates will be the dates they get their applications on file. Accordingly, in cases in which an invention was reduced to practice previously or has been under development for some time, there may be particularly significant advantages to filing by March 15. Now is clearly a time to consider "cleaning out the attic" if a substantial investment has been made in developing a technology and there is a reasonable possibility for commercialization. In addition, this may be a time to consider making a defensive publication to prevent prior efforts from being dominated and superseded by filings made by others under the new regime.

The first-inventor-to-file regime is not without exceptions. The new U.S. law provides a limited one-year grace period that will apply when an inventor makes an enabling public disclosure of the invention and then files a U.S. patent application within one year of the disclosure. In this situation, the inventor can have a limited right to priority based on the date of the public disclosure with respect to subject matter that was disclosed. There is, however, ambiguity in the statutory language and therefore some uncertainty as to the scope of protection provided by the new grace period. In addition, U.S. patent applicants need to keep in mind that public disclosure of an invention prior to filing generally results in a loss of patent rights in most foreign countries.

Increased Body of Effective Prior Art

Section 102 of U.S. patent law identifies the kinds of "prior art" and other events that can be applied to prevent or limit rights in a claimed invention. Under existing U.S. law, these include prior public uses, prior sales or offers for sale, and commercial uses of an invention, provided the uses, sales and offers occurred in the United States. Effective March 16, however, the geographic limitation to the United States will be eliminated. As a result, any application that includes a claim with an effective date of March 16 or later will be subject to challenge based on a large new body of prior art, namely, prior art evidence that the claimed invention was sold, offered for sale or used anywhere in the world. In addition, the AIA increases the risk that patent protection will be denied based on additional prior art in the form of U.S. patents and U.S. published patent applications that originated in foreign countries. After March 16 the effective prior art date of such a patent or published application will be the respective filing date in the foreign country.

It is possible that the body of effective prior art and events will be reduced in some respects. Under current law, an inventor's application can sometimes be rejected based on the his or her own prior acts, even where those acts were kept secret. The inventor's own acts can include publishing the invention, selling it, offering it for sale or commercially using it. However, although the text of the new law is unclear, it appears that under the new law, effective for an application filed on or after March 16, an inventor's own secret commercial use or secret sale of his or her invention can no longer be used to reject the application. This situation may present rare instances, often relating to trade secret manufacturing or synthetic processes and confidential computer programs, in which there may be a benefit to filing after the new law comes into effect instead of before.

Limited One-Year Grace Period

If an inventor publishes his or her invention, sells it, offers it for sale or commercially uses it, existing U.S. law provides that the publication, sale, offer or commercial use can be used to reject the inventor's application. Section 102(b) of the existing law provides for a one-year grace period, whereby an inventor can completely avoid such a rejection if he or she files a patent application within one year of his or her publication, sale, offer or commercial use. For applications filed on or after March 16, however, the U.S. Patent and Trademark Office (PTO) will, notwithstanding the one-year grace period, apply an inventor's prior art against any of his or her claims that seek protection beyond specific embodiments that the inventor publicly disclosed.

New Post-Grant Review Proceedings

A primary objective of the AIA is to increase the integrity of U.S. patents by making them subject to additional and more effective challenges in the PTO. Most importantly, the AIA provides for a new post-grant review proceeding, applicable to any patent resulting from a patent application filed on or after March 16. Patent owners should be concerned about the new post-grant review opportunity since it will give any patent challenger the right to attack validity for any reason that could have been raised in a court of law. Compared to a proceeding brought in a court of law, however, a challenger in the PTO is able to obtain a decision regarding validity more quickly and less expensively, and the challenger has a lesser burden to prove invalidity. A patent will be subject to post-grant review for the nine-month period following the patent's issuance.

Provisional and Continuing Applications

The upcoming changes to U.S. patent law apply not just to new applications filed on or after March 16 - they will in some cases extend to applications filed prior to that date. This will occur when the earlier filed application is abandoned in favor of a post-March 16 application that includes one or more claims to subject matter that was added (new matter) in the post-March 16 application. For example, if a provisional patent application was filed on May 1, 2012 with embodiments A, B and C and then abandoned in favor of a non-provisional application filed May 1, 2013 with new matter and a claim to an additional embodiment D, any claims to embodiments A, B and C will be subject to the March 16 changes in the law. Patent applicants who have pending provisional applications and plan to file non-provisional applications with new matter after March 16 should therefore consider filing non-provisional applications by March 15. This applies equally to applicants who are considering the abandonment of non-provisional applications in favor of continuation-in-part applications. These types of pitfalls should not apply to continuation applications that do not have new matter and that claim priority to a co-pending application filed by March 15, but applicants should consider filing continuation applications by March 15 to eliminate any possibility that the March 16 changes will apply.

The above summary is not meant to be exhaustive. The ramifications of the March 16 changes, as well as earlier changes brought about by the AIA, cannot be fully addressed in this short notice.

The changes in patent law may present several pitfalls for those who file applications after March 15.