Washington—The U.S. Department of Commerce’s United States Patent and Trademark Office (USPTO) today published final rules of practice implementing the first-inventor-to-file provision of the Leahy-Smith America Invents Act (AIA). The provision, one of the hallmarks of the AIA, is a major step towards harmonization of the U.S. patent system with those of the United States’ major trading partners, allowing greater consistency in the prosecution and enforcement of U.S. patents. The AIA also includes safeguards to ensure that only an original inventor or his assignee may be awarded a patent under the first-inventor-to-file system. The first-inventor-to-file provision of the AIA goes into effect on March 16, 2013, and represents the final implementation of the changes mandated by the AIA.
The USPTO also today published final examination guidelines setting forth the agency’s interpretation of how the first-inventor-to-file provision alters novelty and obviousness determinations for an invention claimed in a patent application. In particular, the agency’s final examination guidelines inform the public and patent examiners how the AIA’s changes to the novelty provisions of law alter the scope of what is prior art to a claimed invention and how the new grace period operates.
The United States Patent and Trademark Office (USPTO) announced today that it is creating a new proceeding designed to ensure the first person to file a patent application is actually the true inventor. The new proceeding will ensure that a person will not be able to obtain a patent for an invention that he or she did not actually invent. If a true inventor is not the first to file, the true inventor may challenge the first applicant’s right to a patent by demonstrating that the first application is claiming an invention derived from the true inventor.
This new procedure, called a derivation proceeding, is required thanks to the enactment of the Leahy-Smith America Invents Act (AIA), which went into effect on September 16, 2011. The AIA ushers in a great many changes to patent law and procedure, with the most significant being the change from first to invent to first to file, which does not actually become effective until March 16, 2013. The flavor of first to file adopted by the AIA is not the typical first to file system seen in many other jurisdictions around the world. The American flavor still provides a grace period, although it is peculiar to the inventors own disclosures and can be defeated by subsequent disclosures of third parties. The grace period is, therefore, quite fragile to the point that it is virtually non-existent. Much concern was voiced, however, over whether one could learn of an invention and then win a race to the USPTO. That is where the derivation proceedings come into play. The U.S. version of first to file is better stated as “first inventor to file.”
Director Kappos delivering remarks during the FTF Roundtable, Sept. 6, 2012.
On September 6, 2012, the United States Patent and Trademark Office held a Roundtable on the campus of the USPTO in Alexandria, Virginia. The Roundtable event was for the purpose of the USPTO accepting feedback from the user community on the proposed examination guidelines to implement the first-to-file changes of the America Invents Act (AIA), which go into effect on March 16, 2013.
While there were many issues raised, the one issue on which there seemed overwhelming consensus (although not unanimity) was with respect to the USPTO’s interpretation of the new grace period. A substantial majority of those who offered comments disagreed with the USPTO’s interpretation of 102(b)(1)(B), which pertains to disclosures made by third parties. The USPTO’s interpretation of this provision was set forth in the Federal Register on Thursday, July 26, 2012.
After the pre-scheduled speakers concluded their remarks at the roundtable those in attendance were invited to make remarks. At that time I was recognized and went to the podium to speak on behalf of the USPTO interpretation of the grace period. After my remarks there were no other remarks, but a Q&A session began, with many of those who spoke asking questions of the USPTO Officials in attendance, who were surprisingly willing to provide insight into their interpretations. I say surprisingly because these events are typically not a forum where the USPTO shares information.
Every good invention starts out with an idea, but the answer to the question – can you patent an idea – is a resounding NO! See Can Ideas be Protected? Therefore, in order to obtain a patent and become an inventor it will be necessary to move from idea to patent, which means that travel along the path to invention will take time. As with any lengthy project, keeping notes and tracking progress, success and failures becomes exceptionally important.
In the United States we are still a first to invent country and will remain first to invent up to March 15, 2013. On March 16, 2013, the law changes and the U.S. will become a first to file country, but not exactly like the rest of the world. Inventors will be given an extremely narrow grace period even under the first to file provisions. See USPTO Publishes Proposed First to File Examination Guidelines.
As a first to invent country the party who invents first gets the patent even if they are the second to file a patent application, but this is true if and only if the first to invent has the proof required by the law to demonstrate that they were in fact the first to invent. For many independent inventors and small businesses they simply will never be able to prove they were first to invent because the records they keep are not capable of making the required evidentiary demonstrations.
Those who are even casually familiar with patent law and patent practice undoubtedly know that when dealing with inventions it is always better to file a patent application sooner rather than later. There are many reasons to file sooner rather than later, perhaps chief among them is to prevent the so-called statutory bar from preventing a patent from issuing. The most common statutory bar situation arises when a product that is the embodiment of an invention is publicly used or on sale in the United States more than 12 months prior to a US application being filed. In order to prevent a statutory bar an application needs to be filed promptly, but the 12 month grace period can lull inventors into a false sense of security.
Of course, if you are availing yourself of the privilege of the 12 month grace period in the United States you have already forfeited foreign patent rights. In most of the rest of the world an absolute novelty rule is followed, which means that you must have a patent application on file prior to making any sale, use or public disclosure of the invention. Some will bicker with this as being an overbroad statement, but not by much. If what you sell, use or disclose publicly informs about the invention (which is virtually always the case) you lose the ability to seek foreign patent rights unless you had a patent application on file prior to the informing event. Once again, even the current first to invent law in the United States favors filing early.
But what happens if two or more applications filed by different inventors define the same invention? The old saying is that the more things change the more they stay the same, which very well might be exactly what happens as we transition from interference practice to derivation proceedings.
Anyone interested in reading this is likely old enough to have heard the old saying “Be careful what you wish for – you may get it.” Now we have it. Many people situated variously within and outside of the patent system of the United States urged the adoption of first-to-file. The underlying reasons included harmonization with the laws of other nations, and simplification or elimination of some proceedings in our own system, etc. with a view toward curing some of what has been ailing the U.S. patent system. The day, March 16, 2013, is now approaching when first-to-file will be a reality.
There are many questions about the scope and possible impact of the AIA. Exactly how it will all play out remains to be seen. A significant question is what will be the likely impact of the AIA upon the operations of the USPTO, an organization that has been so greatly over-burdened in recent times.
On Friday, September 16, 2011, President Obama signed into law “The America Invents Act” (“AIA”) which passed the Senate on September 8, 2011, by a vote of 89-9. The AIA passed the House of Representatives on June 23rd by a vote of 304-117. The measure, which is the product of a seven-years-long legislative battle among patent policy stakeholders, changes how patents are obtained and enforced in the United States. Important reforms to patent law are incorporated into the AIA and, just as significantly, several controversial proposed changes were deleted from the AIA before final passage.
Starting with President Obama’s State of the Union Address in January, where he made innovation and job creation key elements of his speech and specifically embraced passage of patent reform as a means of addressing both issues, patent reform was well positioned to be enacted in 2011. Moreover, Congress was desperate for legislative accomplishments in an environment where partisan differences, a weak economy, and government fiscal concerns dominated. Longstanding pro-reform coalitions and associations continued to expend considerable resources on the bill. Passage was deemed virtually assured when the Chairmen of the Judiciary Committees – Sen. Patrick Leahy (D-VT) and Rep. Lamar Smith (R-TX) – essentially agreed this summer on a common piece of legislation. But, as explained below, nothing’s ever as simple as it seems in Washington.
Now that the dust is settling from the passage of H.R. 1249/S.23 (aka the oxymoronic America Invents Act) and those (like me) have stopped “moaning and groaning” about how the America Invents Act or AIA (I feel like washing my mouth out with Ivory soap every I say it) is an utter “sham” to be called reform, it’s time to deal with the reality. The AIA will definitely affect how innovative American small businesses and individuals (the “Davids”) approach patenting their technology in the U.S., especially the change from “first to invent” to “first to file” which has now slanted the playing field in favor of large multinational corporations such as Microsoft (the “Goliaths”). But there are still patenting strategies for the American Davids of Innovation to cope with the AIA (and still compete with the Goliaths) if the primary market to protect is the domestic market.
First, let’s define what I mean by the domestic market. By domestic market, we’re talking about the United States. Not Asia. Not Europe. Not even NAFTA. Just good ol’ America which, for many American Davids is all they care about, and can usually deal with.
In going from the current “first to invent” to the new “first to file” regime mandated by the America Invents Act (AIA), much attention has been focused on the amorphous “grace period” provision provided to patent applicants for certain activities undertaken by them prior to filing for a U.S. patent. Much less attention was paid to the amendments made to sections 203(c)(2) and 203(c)(3) of the Bayh-Dole compliance obligations which were directly impacted by this change in definition from the old “statutory bar” provision (based on publication, on sale, or public use of the invention caused by the patent applicant), to this new “grace period” provision. But even more astounding (and unsettling) are the unrecognized consequences caused by the AIA in “realistically” meeting certain Bayh-Dole compliance obligations by going from the current “first to invent” to the new “first to file” regime.
Thomas Jefferson, author of the Patent Act of 1793
The United States Constitution is a relatively short document, but one that has provided guiding principles for over 220 years. At a time when the nation was struggling to exist under the Articles of Confederation our Founding Fathers met in Philadelphia beginning on May 14, 1787. The outcome of this convention was the U.S. Constitution, which was signed by 38 of the 41 delegates present on September 17, 1787. New Hampshire was the ninth State to ratify the Constitution, and did so on June 21, 1788, causing the Constitution to become the supreme law of the land.
Article I, Section 8 of the U.S. Constitution granted Congress the power to grant patents and copyrights for limited times in order to promote the progress of science and the useful arts. As James Madison stated in Federalist Paper No. 43, the usefulness of the Congresses power to award both patents and copyrights “will scarcely be questioned.” Madison, Debates in the Federal Convention of 1787, at 512-13 (Hunt and Scott ed. 1920). Indeed, the new Congress wasted little time in exercising this power to promote the progress. Clearly demonstrating just how important the Founding Fathers perceived a patent system to be, the third Act of Congress was the Nation’s first Patent Act; the Patent Act of 1790.
As Patent Doc Kevin Noonan pointed out recently, what hasn’t been much discussed is the fact that prior user rights violate the intent of Article I, Section 8 of the U.S. Constitution. I have alluded to this in some articles, and have also alluded to the fact that first to file provisions are more in keeping with the purpose of the so-called Patent Clause to the U.S. Constitution. The very reason for granting Congress the power authorize the granting of patents is to promote the dissemination of information. That is how society benefits, and it is how progress is promoted. I will not go so far as to say that first to invent is unconstitutional, that would be nonsensical. Neither will I go so far as to say that prior user rights are unconstitutional. Nevertheless, what I will say is that first to invent and prior user rights embrace a philosophical choice that is antithetical to the very purpose of the Patent Clause.
I have been watching in utter amazement as individuals with a variety of experience in the patent field debate the constitutionality of the first to invent proposals. This started when those who will not allow truth and accuracy to deter from their arguments started saying that the Supreme Court ruled first to file unconstitutional in Stanford v. Roche. That argument was, and still remains, specious because Standord v. Roche had nothing to do with the issue, nowhere in the case did Chief Justice Roberts make such statement, hint that he was thinking such a thing, or say anything colorably related to such a conclusion. See Did the Supreme Court Rule First to File Unconstitutional?
Now the argument is morphing into a discussion of whether the word “inventor” must mean “first inventor.” This very question is being seriously raised in some academic circles, by some patent practitioners who ought to know better, and by those who simply want to kill patent reform at all costs even if they have to engage in gross misrepresentation in order to do so. Indeed, there are those ranging from neophyte to relatively experienced that are seeking to change history, ignore logic and refuse to acknowledge well established patent law precedent in order to twist the word “inventor” in the U.S. Constitution to mean “first inventor,” which would then call into question the constitutionality of the first to file provisions of patent reform now before the House of Representatives; H.R. 1249.
The ink is hardly dry on the Supreme Court decision in Stanford v. Roche and already those who oppose patent reform are concocting one of the most ridiculous arguments I have ever seen to oppose first to file provisions. There are some, including at least one Member of Congress, that have started saying that the Supreme Court’s decision in Stanford v. Roche makes it clear that the first to file provisions of patent reform are unconstitutional. Just sit right back and allow me to explain to you exactly why that is perhaps the most specious argument I have ever heard.
Let me begin with attempting to explain how presumably intelligent people erroneously conclude that the Supreme Court earlier today held first to file unconstitutional. The argument goes like this: Chief Justice Roberts wrote, “Since 1790, the patent law has operated on the premise that rights in an invention belong to the inventor.” This was repeated several times and in slightly different ways throughout the decision. So those misconstruing the case twist this beyond all reasonable logic to conclude: “patent rights have to belong to the inventor, so those who file first cannot receive the patent ahead of the person who invented first.” Oh my goodness! Is this the level of debate in Congress? No where in the decision is that said! It is no wonder our leaders have failed us so miserably.
President Obama announces of new Commerce Secretary. Secretary Gary Locke (left) and Secretary Designate John Bryson (right).
Earlier today President Obama announced the nomination of John Bryson as the next Secretary of Commerce. Bryson, the former CEO of Edison International and co-founder of the Natural Resources Defense Council, will replace current Secretary of Commerce Gary Locke who has been tapped as the next United States Ambassador to China. Meanwhile, earlier in the day Secretary Locke continued to work patent reform, sending letters to Congressman Lamar Smith (R-TX), who is Chair of the House Judiciary Committee, and to Congressman John Conyers (D-MI), Ranking Member of the House Judiciary Committee, which set forth the Administration’s position on patent reform.
Notably, but not surprisingly, Secretary Locke explained: “The Administration continues to strongly support the bipartisan efforts of Congress to enact patent reform legislation that will accelerate innovation, and create new jobs, new industries and new economic opportunities for Americans.” Secretary Locke went on to elaborate more specifically about some of the specific provisions of the America Invent’s Act, explaining the Obama Administration supports first to file provisions, supports giving the Patent and Trademark Office the ability to set fees and keep the fees collected to be used to run the agency, supports post grant review and supports allowing individuals to submit prior art references to patent examiners. Unfortunately, however, Secretary Locke explained that the Administration generally supports prior user rights given that it is, on balance, a good policy. I respectfully dissent!
The “America Invents Act,” H.R. 1249, contains several provisions that raise substantial questions of constitutionality. Discussed in this article is an important aspect of the “first-inventor-to-file” provision that received no prior public attention because its drafters have concealed its meaning ever since its introduction in previous sessions of Congress. A day after the Senate voted to pass the bill (S. 23), a “clarification” for this poorly drafted section was entered into the Congressional Record as a fabricated “colloquy” that never actually took place on the Senate floor. The colloquy substantially changes the ordinary meaning of the bill to a meaning that had never been discussed publically – Senators had no opportunity to either learn of the “intended” construction or to debate it. While it is uncertain whether the courts would actually interpret the new statute as the colloquy intends, this paper analyzes H.R. 1249 under a construction which the bill’s drafters and the colloquy purport to achieve.
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