The 14th Annual Inventors Conference is presently ongoing at the United States Patent and Trademark Office in Alexandria, Virginia. The conference started yesterday and continues today. I am here at the USPTO presently, and I was here yesterday as well and had an opportunity to hear Patent Office Director David Kappos address the attendees during a lunch speech and then again during the reception at the end of the day. Congressman Dana Rohrabacher (R-CA) also spoke during the reception last night, giving a heavily pro-inventor, pro-patent speech to a very receptive audience. The event has run smoothly, the presentations have been good and it is always nice to be able to get face-to-face time with friends and allies within the independent inventor community. The one potential hot-button issue to be discussed at this conference and taken directly head on by Director Kappos was patent reform, and in particular those issues that may be seen by some as difficult to swallow in the independent inventor community. Credit definitely needs to be given to Kappos for now shying away, addressing concerns and answering questions. I think he even persuaded some in the audience, one of whom was me.
I have long been opposed to changing US patent law from a first to invent system to a first to file system. Yesterday I changed my mind on this and I am cautiously optimistic that moving from a first to invent system to a first to file system will be good for independent inventors and small businesses. There is no doubt that the switch will cause anxiety, as any change would, but I do firmly belief that the positives associated with such a move enormously outweigh the negatives. In part I came to this belief after listening to Director Kappos, who made as persuasive a case as I have ever heard, but his speech was only the last straw or icing on the cake, however you would like to view it. There are many reasons why this makes sense, but lets start with what Kappos said on this issue:
The chances that a patent will be subject to an interference based on a 1st to invent claim—that’s our current system—is .01%. In 2007—the most recent year for which we have statistics—the total number of interference cases for all applicants, of all sizes that were decided based on a priority claim was 7!
That means we already essentially have a first inventor to file system.
Moreover, of those 7 cases, only one case involved a small or medium sized entity; your chances of being impacted by this change are 1 in 441,637. Those are lightning strike level odds, folks!
First, I think this is what appeared in his prepared remarks and not exactly what was said to the crowd, but what was said (at least based on my recollection) was very close and even more persuasive. We all know that interferences are statistically rare, and the dirty little secret is that independent inventors almost never have the right evidence to support a first inventor supplanting a first filer. Those inventors who are knowledgeable enough to know the importance of an inventors notebook are following the right path, but even those sophisticated inventors typically are very unfamiliar with the legal evidentiary standard required to be met in order to prove they were the first to invent. Specifically, it is not enough to have notes, you must have notes that are verified and which demonstrate when you actually conceived. Because conception is a legal conclusion those who are not patent attorneys or patent agents can try as they might, but are almost certainly not keeping notebooks with the required detail. So a first to invent system is creating an unrealistic belief on the part of the inventor community that they can invent first and file second and win. In the overwhelming majority of cases, as pointed out by Director Kappos, the party who files first wins. So changing to first to file will not change much at all.
But what about those who do it right and could benefit from first to invent? Well, they will not benefit under first to file so there will be some negatives and some costs, there is no way around it. But what benefits will a first to file system create? They are massive. More and more I hear that there are many who advise inventors to wait on filing a patent application. This advise is simply not in the best interest of the inventor. As I recently explained, if you wait you may not be able to ever obtain a patent because unknown to you there may be someone else who has created a problem for you under 35 USC 102(b), and there is no remedy or recourse to fix a 102(b) problem. That is why patent attorneys and patent agents universally recommend filing a patent application, even a provisional patent application, as soon as possible. That locks your priority date in stone, and stops the 102(b) clock from running. Filing early reduces the amount of prior art there is that can be used against you, and is simply the best, most preferred way to proceed.
If we move to a first to file system inventors will have every incentive to file something, even a provisional patent application, as early in the process as possible. This will make it increasingly impossible for invention promotion companies to convince inventors to delay filing a patent application, and it should put an end to an abuse that is almost impossible to believe. I am increasingly hearing that invention promotion companies offer financing over 3 years and they will not file a patent application until you have paid your last dollar over that 3 year period. If that is happening it is nearly criminal, and a first to file system should prevent trusting inventors who do not know better to fall into this trap. So to the extent the US patent laws can incentivize inventors to do what we all know to be in their best interest, which is file as early as reasonably possible, a chance to fist to file could come with enormous benefits and make scams and pretenders hard pressed to recommend anything other than the best, most responsible approach to protecting an invention.
There will be some who undoubtedly believe I am naive, overly trusting and too willing to give Kappos the benefit of the doubt. I have for quite a while been viewed as a Patent Office critic, which I suppose is a fair way to view my writings and beliefs over the last several years. If I am being honest and responsible I must and will acknowledge that I think Kappos and the Patent Office are following a very good path, provide lots of reasons for stakeholders to be optimistic and does deserve the support of stakeholders.
Yesterday Kappos asked for patience as he moves forward with his agenda. I don’t think we need to be patient because it is obvious that he has hit the ground running and moving things along at a pace that is very unlike government speed. When I listen to Kappos he comes across as sincere, extremely knowledgeable and very interested in the success of the Patent Office and the US patent system. He cares, he certainly knows the industry and he is forging ahead to make things better, which is an enormously refreshing change. On top of that, he is receptive to ideas. In the few moments I spoke with him yesterday at the reception he told me to keep writing and to not shy away from pointing out when the Office was doing something I didn’t agree with. I certainly will do that, but as I told him agree with what the Office is doing.
Maybe I am drinking the Kool-Aid, but I increasingly believe that Kappos is the right man for the difficult job of revitalizing the Patent Office and US patent system. I never thought I would support first to file, but I am convinced it is the right thing to do. I also never thought I would in any way ever support enhanced post-grant review, but I have an open mind, and while I will reserve judgment until I see the final details what I heard yesterday is very encouraging. But that is something I will write about later today at some point. I am going to shut down now and mingle.