Last year, Congress enacted the most sweeping changes to the U.S. patent laws in almost six decades. These changes to the U.S. Patent Act of 1952, collectively termed the America Invents Act, were signed into law by President Obama in September 2011.
From inception, the United States Patent System was a first-to-invent regime, meaning that the person able to prove he or she was the first inventor won the patent for a useful, novel and unobvious invention. This system served the country well through centuries of innovation and resulted in relatively few disputes over priority of invention (except for some involving key technologies, such as the telephone and the laser). Nevertheless, to harmonize U.S. law with that of other countries (notably, Europe and Japan), the new Act converts the United States to a first-to-file system. Consequently, it is now a race to the Patent Office to establish priority, but the winner must still be the “inventor” to meet the U.S. Constitution’s requirement that Congress secure for inventors (and not corporations or anyone else) the exclusive right to their discoveries.
This sweeping change will have significant implications, especially for small businesses and independent inventors lacking the resources to generate detailed disclosures and file for innovations that may (or may not) ultimately prove to be commercially important. The new regime may also impact negatively the issued patent quality, given the need to prepare the application and file it quickly to avoid losing the race to be first.
Importantly, the first-to-file changes do not take effect until March 2013. Nonetheless, now is a good time to consider how to adapt, such as by encouraging the expedited submission of invention disclosures for consideration.
Aside from the first-to-file changeover, other adjustments are briefly outlined below.
Third party participation in review
Many foreign patent systems (most notably Europe) have long allowed for a post-grant opposition to a newly minted patent. As of September, 16, 2012, U.S. law will allow for a challenge to a patent claim within nine months after issuance (both in an original patent and a patent broadened through a reissue, which can be sought for up to two years after the original patent issues). Moreover, if one is aware of a pending patent claim of suspect patentability, the new law allows for a more meaningful submission of “prior art” by third parties and their comments during the examination process, which can only be done on a very limited basis at present.
Having another look
Another change provides the Patent Office the authority to reconsider information relevant to the patent upon request by the patent owner, such as if a new item of prior art is identified that was not considered by the examiner during the examination of the application that matured into the original patent. This procedure will increase the value of the patent by removing uncertainty and also help to streamline litigation by removing issues that could be raised by a potential infringer.
Fee discounts
Under current law, small entities (such as organizations with fewer than 500 employees, nonprofits, universities and independent inventors) may claim a 50 percent reduction in the government fees due in patent matters. The new law provides an additional break for a micro-entity. To qualify as a micro-entity, an applicant must meet certain household income tests and cannot be the inventor on more than four previously filed patent applications. Micro-entities may also include institutions of higher education, thus giving a further break to universities.
Expedited treatment
Patent examination can be notoriously slow for certain technologies, primarily due to increased filings, a relatively high backlog of pending applications (see chart), and a dearth of examiners. For an additional fee paid on filing (totaling $4,800), an applicant can speed examination, if certain criteria are met (e.g., the application cannot have more than four independent claims and 30 total claims). To avoid overwhelming the Patent Office and thus defeating the intent, expedited treatment is limited to 10,000 requests per year.
Patent marking changes
A few years ago, prospectors initiated a wave of litigation against patent owners who used patent numbers on products not actually covered by live patents, in which the “false marking” activity was typically inadvertent. This led Congress to end the current false-marking regime, which provided a penalty of up to $500 per offense. Now a requirement exists for actual competitive injury in order to file suit. A new virtual marking provision allows a patent owner to provide a Web location listing patent numbers covering a product and then use the web address on the product (thus allowing for periodic updates to patent lists without changing product labeling or packaging).
The Act also revises other important legal concepts, such as the requirement to disclose the best mode of practicing the invention and others defining the concept of prior art. Accordingly, those interested in patent protection should consult a registered patent attorney for guidance on how to adapt to these changes.
Andrew D. Dorisio is a registered patent attorney with King & Schickli, PLLC.