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    America Invents Act: Another Piece Of Patent Reform Puzzle Falls Into Place

    Published on 13 September 2012 @ 9:21 pm

    By for Intellectual Property Watch

    Another phase of historic patent reform goes into effect next week in the United States, as officials from the US Patent and Trademark Office tour the country, answering questions from stakeholders about forthcoming changes in patent law, thanks to the America Invents Act (AIA). The next batch o rules the USPTO is implementing for the AIA go into effect 16 September.

    These include three new administrative trial processes: inter partes review, post-grant review, and a transition programme for covered business method patents – all ways to shift a large number of patent matters from the courts back to the USPTO.

    A USPTO reference guide on the new rules is here [pdf].

    Inter partes review is a trial proceeding conducted at the new Patent Trial and Appeal Board (PTAB) to review the patentability claims in a patent on certain grounds and only on the basis of prior art consisting of patents or printed publications. This replaces the inter partes reexamination proceeding.

    Review begins with a third party – not the patent owner – filing a petition after either: 9 months after the grant, issuance or a reissuance of a patent; or if a post-grant review is launched, the termination of the post-grant review – whichever comes later. The patent owner can file a preliminary response to the petition. Inter partes review can move forward if there is a reasonable likelihood that the petitioner would prevail on at least one claim. A final decision by the PTAB will be issued within one year. The procedure applies to any patent issued before, on, or after 16 September.

    “Part of the reason Congress felt comfortable expanding role of patent office is because they did a really good job on inter-partes reexamination, when they got organised on that,” explained Edmund J. Walsh co-chair of the Cleantech Group and Post-Grant Practice Group for Wolf Greenfield intellectual property law firm in Boston.

    Post-grant review is a new trial proceeding at the PTAB to create a new, faster, and less expensive way for a third party to challenge the validity of a US patent. This process begins with a third party filing a petition on or prior to 9 months after the grant of the patent or issuance of a reissue patent. A post-grant review may be instituted upon proof that, more likely than not, at least one claim challenged is unpatentable. A final decision will be made within one year. The procedure applies to patents issuing from applications subject to first-inventor-to-file provisions of the AIA, which becomes effective 16 March 2013. This will bring the US more in line with the post-grant opposition proceedings used by other countries, including the European Patent Office.

    Related story: America Invents Act Forges Ahead; Concerns Remain About First-To-File, Other Provisions

    The transitional program for covered business method patents (TPCBM) is a new proceeding to review the patentability of one or more claims in a covered business method patent. TPCBM proceedings employ the procedures of a post-grant review, with certain exceptions, such as for first-to-invent patents, only a subset of prior art is available to support the petition. The programme will sunset for new TPCBM petitions on 16 September 2020.

    “If someone accuses you of infringing a business method patent, starting on the 16th, you have the option of going to court or going to the patent office to determine if that patent is valid,” Walsh said. “The idea is that the overall, in the aggregate, the costs will be less but to a large extent, the costs to the challenger will be going down. Possibly the cost to the inventor will be going up, because of the out-of-pocket costs.”

    Also Going Into Effect…

    On 14 August, the USPTO issued rules implementing provisions that go into effect on 16 September, addressing: Inventor’s oath or declaration provisions; supplemental examination and revised reexamination fees; inter partes review and post-grant review proceedings; USPTO patent trial practice guide; rules of practice for the PTAB, and; post-grant review for Covered Business Method Patents. The public has until 5 October to comment.

    On 16 Sept., the following will also go into effect:

    • Inventors are no longer the only possible applicants. For international applications, a US applicant can include: sole of joint inventors; legal representative of a dead or legally incapacitated inventor; assignee; obligated assignee; or a person who otherwise shows sufficient proprietary interest.
    • It’s no longer required to have the identification of an inventor’s citizenship or a declaration that the inventor believes him or herself to be the “first” inventor.
    • A supplemental examination process will provide patentees with an alternative to litigating inequitable conduct allegations made by a third party. It also expands the types of information that can be considered by the USPTO in an ex parte reexamination. After 16 Sept., a patent owner can request supplemental examination of a patent to “consider, reconsider, or correct information” believed to be relevant to the patent. A third party cannot participate in a supplemental examination.
    • Preissuance submissions: This aims to bring the most relevant prior art to the examiner’s attention as early as possible and make it easier for a third party to submit prior art in another party’s pending patent application. Third parties may submit relevant patents, published patent applications, or other publications for consideration in the record of a patent application, but submissions must be “printed publications,” which can also include foreign patents, communications from patent offices, and other non-patent documents. They need not be prior art.
    • Prior art: An expanded pool of prior art can be cited in a patent filing to include written statements by the patent owner made before a federal court or the USPTO regarding the scope of any patent claim. Third parties must explain pertinence of prior art submitted or include a written statement to at least one claim of the patent.

    The USPTO recently published other rules and notices about the forthcoming implementation of other aspects of AIA, including those that:

    • Create a new derivation proceeding designed to ensure the first-to-file patent applicant is actually the true inventor. If the true inventor is not the first to file, that inventor can challenge the first applicant’s right to a patent by proving that the invention is his or her own. These PTAB derivation proceedings will take effect on 16 March 2013.
    • Propose to set or adjust 352 fees needed to recover office patent operation costs. This includes a new 75 percent reduction for micro entities and expands the 50 percent small entity discount to more than 25 additional patent fees. It also proposed to stagger the time for paying appeals-related fees and to refund fees when post-grant proceedings are not instituted. Comments are due 5 November.

    After 16 September, there are only what are called “Group 3” rulemakings left to implement by March 2013, and they primarily concern transition to the new first-inventor-to-file system – a system that many small, independent inventors argue favours large corporations and other deep-pocketed entities. Statutory Invention Registration would also be repealed. The US currently uses a first-to-invent system, which is at odds with most of the rest of the international community.

    “We have carefully crafted the proposed rules for this transition based in part” on suggestions from public, stakeholders, USPTO Director Dave Kappos said 6 September during an agency first-to-file roundtable in Virginia. “We hope the model we propose will be beneficial to all patent holders” – large to small, he added.

    Most “importantly, we also want to make sure that the independent inventor community represented here today find that the system proves to be very beneficial to that particular community,” Kappos continued. The new procedures are designed to “make our patent system more accessible than ever before to inventors seeking protection for their inventions when they are ready to do so.”

    Related story: US Congressional Push For Release Of TPP Text; US Pressuring Nations Bilaterally?

    Moving Toward Harmonisation, But Questions Remain

    Calling the AIA a “substantive and very historical step” toward international patent harmonisation, Q. Todd Dickinson, executive director of the American IP Law Association, said during the 6 September AIA first-to-file roundtable that he hopes the US patent reform will urge the rest of the world, particularly Europe, toward using the one-year-grace period.

    “We see this as a first step … for even more substantive progress,” Dickinson said. “We hope and trust the US will continue its leadership” in international discussions on a global patent system.

    Dickinson and other stakeholders said some concerns remain, however, over issues such as exact implementation of the rules, ensuring patent examiners are well-versed in the new law, making a smooth transition to a first-to-file system, and how to make the patent system even more user-friendly.

    There are still areas of “complication and ambiguity,” Dickinson said, in regards to, for example, the scope of the grace period, procedures and remedies for derivation, and whether the US declaration really will harmonise assignee filing.

    Others voiced concern that the USPTO is going to be “overwhelmed” with derivation proceedings launched to prove inventors are the first-to-file. The USPTO, said Brad Pedersen of the Minnesota Intellectual Property Law Association, should not encourage people to “resort to derivation.”

    Meanwhile, John Vaughn, executive vice president of the Association of American Universities, said that while his organisation supported the AIA, it compromised on a number of fronts to get the overall patent reform enacted, “because in our judgment the benefits to the system overall were more compelling,” including first-to-file, which benefits university research, increases harmonisation, decreases patent costs, and other benefits.

    But now, Vaughn said, some – including the USPTO – are interpreting a much narrower grace period than what was intended, which is an “enormous problem for the university community.”

    “This language seems to the university community to be a gratuitous extrapolation well beyond the bounds” of the statute language, Vaughn said, and could “possibly” exceed rulemaking authority by the USPTO.

    A narrower grace period, he continued, “almost seems to invite someone” who finds disclosure language problematic to copy that disclosure, introduce some mere or trivial change, publish that product by just putting it on a website or elsewhere, and thereby establishing prior art, “eviscerating the grace period to encourage early publication,” which is so essential to universities.

    Walsh said grace period is one of those “grey areas” where the law is unclear and the USPTO will have to fill in the gaps.

    Related story: Health Advocates Eye Proposed Changes to Patent Law in South Africa

    The AIA already is faced with legal challenges.

    For example, a Florida inventor who holds a patent on a motorcycle is already suing the US government, saying the AIA will favour big companies over small inventors and claiming the law is unconstitutional.

    Plus there are other challenges to implementation and AIA in practice.

    The new proceedings under AIA, for example, will not be like regular patent prosecution and litigation. Rather, Walsh said, “it’s going to combine elements that exist in a very, very challenging way for practitioners who are going to handle these proceedings.”

    For inventors, there are many opportunities to miss deadlines under rigid new rules, Walsh continued. Plus, there may be more out-of-pocket costs for inventors who may now hire experienced patent attorneys to handle their patent applications rather than do it themselves.

    “There’s going to be a lot of pressure. There’s going to a lot of need to be persuasive like a litigator, but on the other hand package your persuasiveness around technical issues like you’re dealing with a patent examiner,” Walsh said. “This is not the kind of proceeding you want to handle yourself. It’s also not the kind of thing you want to just open up the phone book and find any patent attorney.”

    Liza Porteus Viana may be reached at lizapviana@gmail.com.

     


    Leave a Reply

    We welcome your participation in article and blog comment threads, and other discussion forums, where we encourage you to analyse and react to the content available on the Intellectual Property Watch website. By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

    We welcome your participation in article and blog comment threads, and other discussion forums, where we encourage you to analyse and react to the content available on the Intellectual Property Watch website.

    By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

    1. You agree that you are fully responsible for the content that you post. You will not knowingly post content that violates the copyright, trademark, patent or other intellectual property right of any third party or which you know is under a confidentiality obligation preventing its publication and that you will request removal of the same should you discover that you have violated this provision. Likewise, you may not post content that is libelous, defamatory, obscene, abusive, that violates a third party's right to privacy, that otherwise violates any applicable local, state, national or international law, that amounts to spamming or that is otherwise inappropriate. You may not post content that degrades others on the basis of gender, race, class, ethnicity, national origin, religion, sexual preference, disability or other classification. Epithets and other language intended to intimidate or to incite violence are also prohibited. Furthermore, you may not impersonate others.

    2. You understand and agree that Intellectual Property Watch is not responsible for any content posted by you or third parties. You further understand that IP Watch does not monitor the content posted. Nevertheless, IP Watch may monitor the any user-generated content as it chooses and reserves the right to remove, edit or otherwise alter content that it deems inappropriate for any reason whatever without consent nor notice. We further reserve the right, in our sole discretion, to remove a user's privilege to post content on our site. IP Watch is not in any manner endorsing the content of the discussion forums and cannot and will not vouch for its reliability or otherwise accept liability for it.

    3. By submitting any contribution to IP Watch, you warrant that your contribution is your own original work and that you have the right to make it available to IP Watch for all purposes and you agree to indemnify IP Watch, its directors, employees and agents against all damages, legal fees and others expenses that may be incurred by IP Watch as a result of your breach of warranty or of these terms.

    4. You further agree not to publish any personal information about yourself or anyone else (for example telephone number or home address). If you add a comment to a blog, be aware that your email address will be apparent.

    5. IP Watch will not be liable for any loss including but not limited to the following (whether such losses are foreseen, known or otherwise): loss of data, loss of revenue or anticipated profit, loss of business, loss of opportunity, loss of goodwill or injury to reputation, losses suffered by third parties, any indirect, consequential or exemplary damages.

    6. You understand and agree that the discussion forums are to be used only for non-commercial purposes. You may not solicit funds, promote commercial entities or otherwise engage in commercial activity in our discussion forums.

    7. You acknowledge and agree that you use and/or rely on any information obtained through the discussion forums at your own risk.

    8. For any content that you post, you hereby grant to IP Watch the royalty-free, irrevocable, perpetual, exclusive and fully sub-licensable license to use, reproduce, modify, adapt, publish, translate, create derivative works from, distribute, perform and display such content in whole or in part, world-wide and to incorporate it in other works, in any form, media or technology now known or later developed.

    9. These terms and your posts and contributions shall be governed and interpreted in accordance with the laws of Switzerland (without giving effect to conflict of laws principles thereof) and any dispute exclusively settled by the Courts of the Canton of Geneva.

     

     
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