In USPTO v. Bilski, U.S. Supreme Court confronted us with a “fuzzy” composite of opinions about the standard for patent-eligibility under 35 U.S.C. § 101.  See Through the Fuzzy Bilski Looking Glass: The Meaning of Patent-Eligible under 35 U.S.C. § 101 where I noted five key “takeaways” from those composite opinions, including what to make of Justice Scalia joining the Opinion of the Court except for Part II B-2 and C-2.  The Federal Circuit is also not immune from composite opinions that make you scratch your head as to what the final ruling is.  See Ariad Pharmaceuticals, Inc. v. Eli Lilly & Company where an en banc ruling by the Federal Circuit on whether there is a separate “written description” requirement under 35 U.S.C. § 112, first paragraph, spawned (in addition to the Opinion of the Court), four additional concurring and dissenting-in-part opinions.  In affirming the judgment of the district court “by an equally divided court,” the recently issued Marine Polymer Technologies, Inc. v. Hemcon, Inc. case requires yet some more figuring about another “muddled” Federal Circuit en banc decision.

The “muddle” that became the en banc decision in Marine Polymer revolved around two primary questions:  (1) the meaning of the claim term “biocompatible”; and (2) when does “intervening rights” apply to reexamined claims?  See CAFC: Intervening Rights for Claims Unamended During Reexam* where I discussed both of these questions in the Federal Circuit panel decision in Marine Polymer.  In the en banc decision, and by a 5 “yea” to 5 “nay” vote (with Judges Moore and O’Malley not taking part), the Federal Circuit deadlocked over the district court’s interpretation of “biocompatible” to mean “low variability, high purity, and no detectable biological reactivity as determined by biological reactivity as determined by biocompatibility tests.”  In jurisprudential parlance, such a “tie vote” means the district court interpretation prevails by default.

Well the proverbial cat is now “out of the bag.” The United States Patent & Trademark Office (USPTO) has issued its long awaited (and in many quarters, apprehensively feared) proposed patent fee changes pursuant to its new authority under Section 10 of the America Invents Act. I usually refer to the AIA as the “Abominable Inane Act” and this new fee setting authority is one reason for that characterization. These proposed patent fee changes are summarized in an 8 page Table to a 34 page Executive Summary which was submitted to the Patent Public Advisory Committee on February 7, 2012. For those true “masochists,” there’s an even longer 85 page detailed Appendix on these proposed patent fee changes to digest.

Page 11 of the Executive Summary provides what it characterizes as summary of the “significant changes” to the current patent fee structure. After getting over my initial “shock” at how high some of these proposed fees are (for the new supplement examination and new post-grant review procedures, as well as the existing ex parte reexamination procedure, these proposed patent fees can be characterized as “astronomical”), as well as how much these proposed fee changes increase current fees, I then asked this question: what do these proposed patent fee changes really mean?

On September 26, 2011, the a three-judge-panel of the United States Court of Appeals for the Federal Circuit issued a ruling in Marine Polymer Technologies, Inc. v. HemCon, Inc., which found intervening rights due to certain patent claims due to the fact that Marine Polymer made arguments about claim language during reexamination, but without actually amending the claims. See Marine Polymer vacated opinion.  On January 20, 2012, the full Federal Circuit decided to hear this case en banc and ordered that the original panel decision be vacated and the appeal reinstated. No additional briefing by the parties was requested, but on January 26, 2012, the Federal Circuit issued an Order allowing amicus briefs to be filed on or before February 10, 2012. On February 10, 2012 the Biotechnology Industry Organization and Pharmaceutical Research and Manufacturers of America filed a joint Amici Curiae Brief supporting the appellee and seeking affirmance of the district court decision.

Before getting into the arguments made by the Bio/Pharma brief, let’s go over the now vacated original panel decision to set the table.

In the annual State of the Union Address President Obama explained: “Innovation is what America has always been about.”  Today the Obama Administration took major steps forward to collaboratively work with private industry to tap American ingenuity to assist in a world-wide humanitarian effort.  The United States government will work with the private sector, universities, and non-profits to foster game-changing innovations with the potential to solve long-standing development challenges in health, food security and environmental sustainability.

I had the honor of being invited to the White House today for the Innovation for Global Development Event, which was held in support of the President’s commitment to using harness the power of innovation to solve long-standing global development challenges.  As a part of this event, David Kappos, Under Secretary of Commerce for Intellectual Property and the Director of the United States Patent and Trademark Office, launched a pilot program dubbed Patents for Humanity, which is a voluntary prize competition for patent owners and licensees.  The pilot program seeks to encourage businesses of all kinds to apply their patented technology to addressing the world’s humanitarian challenges.

USPTO Publishes Proposed Rules for Supplemental Examination and to Revise Reexamination Fees

Changes will implement provisions of the America Invents Act

Washington – The United States Patent and Trademark Office (USPTO) is proposing rules of practice in patent cases to implement the supplemental examination provisions of the America Invents Act. The USPTO is also proposing to adjust the fee for filing a request for ex parte reexamination and to set a fee for petitions filed in ex parte and inter partes reexamination proceedings to more accurately reflect the cost of these processes. The USPTO published these proposed rules in the Federal Register on January 25, 2012.

The CAFC’s split panel decision this past week – In re Construction Equipment Company – extends the PTO’s authority to reexamine a patent even where its validity has already been adjudicated and confirmed by the courts.  Yet the CAFC once again fails to explain how a PTO reexamination finding that a patent is invalid effects an earlier judicial determination that the same patent is valid and infringed.

In re Swanson

The authority of the PTO to reexamine a patent that has previously been found to be valid by the courts was established by the CAFC’s 2008 decision, In re Swanson.  There, the patent owner sued for infringement.  A jury found that the patent was not infringed, but additionally found that the patent was not invalid over the so-called Duetsch reference.  The trial judge denied the various post-trial motions, confirming the jury’s verdict.  And the CAFC affirmed the trial judge’s judgment regarding validity, explicitly finding that “Deutsch” did not anticipate the patent claims.

It is virtually impossible to in any intellectually honest way truthfully determine what the legislative intent of Congress was for any particular piece of legislation.  Justice Antonin Scalia has railed against the use of legislative history for decades, saying “legislative history is irrelevant when the statutory text is clear,” and referring to the “legal fiction” that legislative history, including Committee Reports, actually reflect the intent of the Congress.  This is, of course, because it is exceptionally easy to get something into the legislative history, so anything that appears in the legislative history may only be the view of one particular Member of Congress, or worse the view of a lobbyist paying for access.  There is also the problem associated with Members of Congress saying things they simply don’t understand, and the reality that the legislative history cannot be cross examined.  Even Committee Reports are at best the view of a majority of a group that makes up a small fraction of the overall Congress.  It seems a fools errand to rely on legislative history in all but the rarest case, and Scalia’s view seems to be the prevailing view of this Supreme Court.

Notwithstanding the inherent unreliability of legislative history and the truly scary prospect of trying to get inside the head of Members of Congress, it seems fairly clear to me that the America Invents Act, which was signed into law by President Obama on September 16, 2011, contains at least a handful of things that can only be characterized as unintended consequences.  Among them are: (1) U.S. patents issued from foreign filings will be prior art as of the foreign filing date; (2) commonly owned patent applications cannot be used against each other for novelty purposes; and (3) the creation of an post grant challenge limbo because of the delay in initiating post-grant review procedures.

I have done quite a bit of writing about the America Invents Act, but I have been a bit derelict in providing the sequel to America Invents: A Simple Guide to Patent Reform, Part 1.  Part of the reason, if not the entirety of the reason, is that the major parts of the American Invents Act that remain are anything but simple.

I was speaking with John White via telephone yesterday about the America Invents Act.  Yes, John and I are thoroughly immersed in this legislation and coming up with wrinkle after wrinkle that you probably never thought about.  Fun I know, but that is what two wild, crazy and tremendously charismatic patent attorneys talk about!  In any event, I told him I was having difficulty and asked him — how do you describe prior user rights, post-grant review and supplemental examination simply?  His response: “You don’t.”  We went on to talk about how first to file isn’t all that simple either, although the name suggests otherwise.  This thing, the monstrosity that is the America Invents Act, will be a full employment act for lawyers!  But when is it ever good for clients when it is good for the attorneys?

In any event, on this note I embark upon Part 2, which will seek to make sense of prior user rights, post-grant review, preissuance submission and patentability changes. This will leave inter partes review, supplemental examination and derivation proceedings for the finale — Part 3.  I will endeavor to describe these in the most straight forward way possible, but I am going to completely punt on Section 18 as it pertains to business methods and post-grant review, at least for now.  I just see no way to explain that in a “simple” way.  Notwithstanding, look for an article on Section 18 soon (a relative term I know), along with an article about specific peculiarities and likely unintended consequences of the Act.