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Patent Reform Passes the House
Yesterday, the U.S. House of Representatives passed the America Invents Act, H.R. 1249. With the bill’s passage, the House joins the Senate in adopting the most significant change in U.S. patent law in over sixty years. The Senate passed its version of the America Invents Act this past March.
While there are some differences in the bills, the bills are principally the same, with both altering a wide range of current law and practices before the U.S. Patent and Trademark Office (USPTO).
Summary of the Major Changes in Patent Law and USPTO Operations
The major areas of change resulting from the legislation are listed below with a brief explanation of each area.
First-Inventor-to-FileChanges the U.S. system such that entitlement to a patent is granted to the first-inventor-to-file for a patent. This change largely conforms U.S. law with the rest of the world by doing away with the granting of a patent to the person(s) shown to be the first inventor.
Derivation Actions/Proceedings
Provides a mechanism by which a petitioner who is currently a patent applicant can seek cancellation or refusal of the claims in an earlier patent or application in which an inventor named in the earlier patent or application derived the invention from the petitioner and filed the earlier patent application without authorization by the petitioner.
False Patent Marking
Eliminates the ability to bring an action for false marking, except to recover actual competitive damages resulting from the false marking. The Federal Government retains the sole right to sue for and recover statutory damages based on false marking. Also, a manufacturer may write the word “Patent” or “Pat.” on a product, along with a reference to a website freely accessible by the public that provides more information about the patent.
Prior User Rights
A party using an invention before another party files a patent application will have a defense to infringement based on the prior use. Importantly, the House bill does not provide the prior user rights defense against patents having subject matter developed pursuant to any federally funded R&D agreements or by universities without funding from private business.
Advice of Counsel
To codify the Knorr-Bremse decision, failure by an accused infringer to obtain advice of counsel with respect to any allegedly infringed patent cannot be used to prove willful infringement or inducement of infringement.
Post-Grant Proceedings
Post-Grant Review
Post-grant review provides an opportunity to challenge the validity of recently issued U.S. patents. All issues of patent invalidity may be considered in addition to prior art, such as lack of enablement or written description. Parties must show that it is more likely than not that at least one claim is not patentable, or that there is a novel or unsettled legal question that is relevant to other patents and applications. Parties are estopped from raising in civil litigation or International Trade Commission proceedings any issue that was raised or could have been raised in post-grant review.
Inter Partes Review
Replacing inter partes reexamination, inter partes review will be limited to grounds of anticipation or obviousness based on prior art patents or publications. Parties are estopped from raising in civil litigation of International Trade Commission proceedings any issue that was raised or could have been raised during inter partes review.
Prior Art Submissions
A third party may submit references and a concise statement of the relevance of each reference to the USPTO while a patent application is pending. The submission will be entered into the record for consideration by the examiner. The deadline to submit references is the earlier of (1) a Notice of Allowance or (2) the later of six months from publication or the issuance of a first office action rejecting a claim.
Best Mode Requirement
A patent cannot be canceled, invalidated or held unenforceable based on a failure to disclose the best mode.
Fee Setting Authority
The Director of the USPTO may set or adjust fees, which can only be used to recover estimated costs relating to the administrative costs, processing, activities, services and materials relating to patents and trademarks.
PTO Funding
Establishes the USPTO Public Enterprise Fund as a revolving fund available to the Director, without fiscal year limitation. All fees payable under 35 U.S.C. 41 (application fees, extension fees, issues fees, maintenance fees, etc.) and 42 (fees for services performed by the PTO) are to be deposited into the Fund and available to the Director until expended.
Supplemental Examination
A patent may be corrected at the request of a patent owner, provided that a substantial new question of patentability is raised by at least one item of information, such as a newly identified reference that was not made of record during prosecution. The House bill includes a provision to terminate supplemental examination of a patent if the USPTO Director concludes there was an attempt to defraud the USPTO.
Tax Strategy Patent Exclusions
Any strategy for reducing, avoiding or deferring tax liability is unpatentable, even if the strategy was unknown at the time of the invention or application for patent.
Joinder of Parties
A patent owner will not be able to sue multiple parties in one action unless (1) the right to relief arises out of the same transaction, occurrence or series of occurrences relating to infringement and (2) there are questions of fact common to all of the parties.
Satellite Offices
The House bill mandates three or more satellite offices, with the first satellite office in Detroit, Michigan.
Priority Examination
An applicant may request priority examination of an application that claims technologies deemed important to the national economy or national competitiveness. |
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