Leahy-Smith America Invents Act J. Gibson Lanier, JD, PhD Ballard Spahr LLP

2 Leahy-Smith America Invents Act Enacted September 16, 2011 Many changes in the Act that require rule-making activity by the USPTO Immediate changes as of September 16, 2011 September 26, 2011  September 16, 2012  March 16, 2013

3 First to Invent to First to File STARTS March 16, 2013 for SOME patents/applications The U.S. patent system is changed from a “first to invent” to a “first inventor to file” system. Will only apply to applications filed, and patents issuing from applications filed, after March 16, 2013 that do not claim priority to applications filed prior to that date. Earlier effective filing date- current law applies Mind the GAP- at 3/16/2013 Claims or applications that ever had a claim in either system

4 Novelty – New Provisions March 16, (a) knowledge, use, publication, or patenting before the invention; 102(b) knowledge, use, publication, or patenting more than one year prior to filing; 102(d) procurement of a foreign patent by patentee filed more than one year before earliest filing; 102(e) publication of a patent or application after filing date of claimed invention, but having a priority date prior to earliest filing date; 102(f) patentee didn’t invent subject matter to be patented 102(a)(1) No territorial limit on public use, sale, “otherwise available” 102(a)(2) 291 Derivation 102(c) abandoned invention 102(g) prior invention by another who did not abandon, suppress, or conceal Eliminated

5 New §102 Grace Period and Exceptions Before Effective Filing Date “Disclosures”Patents/Applications 102(a) Prior art Entitled to a Patent UNLESS 102(a)(1) Patented, Printed publication, public use, on sale, available to public 102(a)(2) 1 st filed U.S. patent application by another 102(b) Exceptions NOT Prior Art 102(b)(1)  1 year (A) Any disclosure coming directly or indirectly from the Inventor (B) Disclosure by others after Inventor’s public disclosure 102(b)(2) (A) 1st pat/app derived invention from Inventor (B) 1st pat/app filed after public disclosure by Inventor (C) Common assignee for Inventor and 1st pat/app-joint research agreement

6 Novelty Current Law New Law (effective 18 months after enactment) 102(a)102(b)102(d)102(a)(1) What?1. Known 2. Used 1. Patented 2. Described in a printed publication 1. Patented 2. Described in a printed publication 3. In use 4. On sale 1. Patented 2. Caused to be Patented 3. Subject of an inventor’s certificate 1. Patented 2. Described in a printed publication 3. In public use 4. On sale 5. Otherwise available to the public By whom?OthersAnyoneApplicant Legal Assigns Anyone Where?In this country Anywhere Anywhere but USAnywhere When?Before the inventionMore than 1 year prior to the earliest filing date Before the effective filing date

7 Disclosure Scenarios A & B are inventors for patent application, more than a year before the filing, A & B publish a paper describing the invention 9/16/2013 9/16/2014 Application is filed by A & B Disclosure by A & B Conclusion: Disclosure is art under 102(a)(1) No patent for A&B

8 Disclosure Scenarios A & B are inventors for patent application, less than a year before the filing, A & B publish a paper describing the invention 9/16/2013 9/16/2014 Application is filed by A & B Disclosure by A & B Conclusion: Disclosure is not art under 102(b)(1)(A)

9 Disclosure Scenarios A & B are inventors for patent application, less than a year before the filing, A is an author on a paper describing the invention 9/16/2013 9/16/2014 Application is filed by A & B Public disclosure by A &C or A alone Conclusion: Disclosure is not art under 102(b)(1)(A) because A is a joint inventor.

10 Disclosure Scenarios 1 st to file/ 1 st to disclose A & B are inventors for patent application, less than a year before the filing, X publishes a paper describing the invention, but before X’s disclosure, A&B publicly disclose their invention 9/16/2013 9/16/2014 Application is filed by A & B Public disclosure by A & B Conclusion: Intervening disclosure by X is not art under 102(b)(1)(B) Disclosure by X

11 Disclosure Scenarios Derived from Inventors A & B are inventors for patent application, less than a year before the filing, Y publishes a paper describing the invention 9/16/2013 9/16/2014 Application is filed by A & B Public disclosure by Y Conclusion: Y Disclosure is prior art to Application by A&B UNLESS Y obtained information directly or indirectly from A or B ( 102(b)(1)(A))

12 Disclosure Scenarios Derived from Inventors A & B are inventors for patent application, less than a year before the filing, X publishes a paper describing the invention, but prior to X’s disclosure, Y publicly discloses the invention 9/16/2013 9/16/2014 Application is filed by A & B Disclosure by Y Conclusion: X is not prior art (under 102(b)(1)(B)) provided Y obtained information directly or indirectly from A and/or B Disclosure by X

13 First-to-File for Applications/Patents The first-to-file gets the patent, except where 1) The first filer obtained the invention, directly or indirectly, from the second filer (derivation proceedings will resolve this) 2)The second filer was the first to “publicly disclose” the invention 3)Common assignee for the second filer and first filer-jt research agreement 4)The first filer abandons the application prior to publication or issuance

14 1 st to File Scenarios 1 st to File X files an application, A & B file a patent application 9/16/2013 9/16/2014 A & B file a patent application Conclusion: X gets a patent, A&B get bupkis 102(a)(2) X files a patent application 3/16/2013

15 1 st to File Scenarios Reality A&B file a patent application, later- X’s patent issues or application publishes X independently arrived at same subject matter. Conclusion: X gets a patent, A&B get whatever is not taught by X’s patent/application X’s patent issues/application publishes- will the USPTO find this? 9/16/2013 9/16/2014 A & B file a patent application [X files a patent application] 3/16/2013

16 1 st to File Scenarios 1 st to File X files a patent application, A & B file a patent application, but X derived the invention from A&B 9/16/2013 9/16/2014 A & B file a patent application Conclusion: A&B get a patent if X loses the derivation proceeding 102(b)(2)(A) X files a patent application 3/16/2013

17 1 st to File Scenarios 1 st to Disclose A & B file a patent application, less than a year before the filing, A publishes, and X files an application after the publication 9/16/20139/16/2014 A & B file a patent application Disclosure by A Conclusion: A&B get a patent, X gets nada 102(b)(2)(B) X files a patent application 3/16/2013

18 1 st to File Scenarios 1 st to Disclose/Derived A & B file a patent application, less than a year before the filing, Y publishes, and X files an application after the publication 9/16/20139/16/2014 A & B file a patent application Disclosure by Y Conclusion: A&B get a patent, X gets nada If Y derived information from A&B 102(b)(2)(B) X files a patent application 3/16/2013

19 1 st to File Scenarios 1 st Disclosure A & B file a patent application, more than a year before the filing, A publishes, and X files an application after the publication 9/16/20139/16/2014 A & B file a patent application Conclusion: No one gets a patent if A’s disclosure anticipates the inventions 102(a)(1) X files a patent application (4/16/2014) 3/16/2013 Disclosure by A (6/16/2013)

20 1 st to File Scenarios 1 st Disclosure A & B file a patent application, more than a year before the filing, A publishes, and X files an application after the publication 9/16/20139/16/2014 A & B file a patent application Conclusion: X is not prior art to A’s application 102(b)(2)(B) but A’s disclosure is art to A&B 102(a)(1) X files a patent application (4/16/2014) 3/16/2013 Disclosure by A (6/16/2013)

21 1 st to File Scenarios Common Assignee X files a patent application, A & B file a patent application, X and A&B are all employed by University, and are in a joint research agreement 9/16/20139/16/2014 A & B file a patent application Conclusion: A&B get a patent, X gets patent 102(b)(2)(C) X files a patent application 3/16/2013

22 1 st to File Scenarios Abandonment X files a patent application, A & B file a patent application, X’s application is abandoned without publishing 9/16/20139/16/2014 A & B file a patent application Conclusion: A&B get a patent- no prior art X files a patent application 3/16/2013

23 First to File Suggestions File before any public disclosure to prevent loss of rights outside U.S. Continue this practice after March 16, 2013 Pay attention to any public disclosures and document them Track disclosures, access by others (derivation) and others’ activities Monitor competitors closely File early and often- multiple provisionals

24 1 st to File Scenarios Multiple disclosures 9/16/2013 9/16/2014 A & B file on ZM Conclusion: A&B get Z and ZM X gets ZY X files on ZY 3/16/2013 A files on Z

25 Obviousness – 103(a) A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made. 35 U.S.C. § 103(a)

26 Non-obvious subject matter  (a) largely unchanged from current law, but amended to account for first to file. DELETED- 103(b) (biotechnology-the non-obviousness of methods for making or using novel and non-obvious composition) DELETED- 103(c) (exclusion as prior art subject matter which is subject to assignment or commonly owned at the time the invention was made) 103 is changed with respect to availability of prior art as it relates to new standards and exceptions under (c) is provided for in the prior art exception in 102(b)(2)(C)

27 Leahy-Smith America Invents Act September 16, 2011 Immediate changes as of September 16, 2011 September 26, % surcharge on particular fees Prioritized examination program effective *IF USPTO doesn’t get extra funding, because the statutory changes are a priority, other programs may cease, no new examiners, slow down at USPTO September 16, 2012 March 16, 2013

28 9/16/2011 Effective Date Proceedings commenced on/after 9/16/11 1)Best mode defense - Civil/USPTO 2)Marking - Pending cases Virtual marking – pat + website No Qui Tam actions- except commercial damage 3)Joinder- All defendants must have common facts, not just infringing patent 4)USPTO sued in E.D. of Va- not D Ct of DC

29 Best Mode - § 282(b)3(A) Effective September 16, 2011, best mode no longer raised as an invalidity or unenforceability defense in any subsequently- filed litigation. But, § 112 still requires disclosure of best mode known to inventor at time of filing.

30 Virtual Marking - § 287(a) Current: marking patented article with “patent” or “pat.” along with patent number. New: affix “patent” or “pat.” together with an address of a posting on the Internet, accessible to the public without charge, that associates the patented article with the number of the patent.

31 False Marking - § 292(a) Only the United States may now sue for false marking. The marking with a patent that covered product but now is expired is not a violation. Allows only a person who suffered competitive injury to file civil action for compensatory damages instead of $500/offense. Effective September 16, 2011 for any then pending or later filed case.

32 Dis-Joinder of Parties - § 299 On Thursday, September 15, 2011, at least 54 new patent cases were filed against a total of 804 named defendants with the average complaint accusing 16 entities of patent infringement. No more. Can’t join multiple defendants in a single lawsuit simply based upon the fact that the defendants are all alleged to infringe the same patent.

33 Dis-Joinder of Parties - § 299 Accused infringers may be joined (by you-know-who) as defendants or have their actions joined for trial only if the right to relief is against all the parties : (1) arises out of the same transaction, occurrence, or series of transactions or occurrences relating to the making, using, importing into the United States, offering for sale, or selling of the same accused product or process and (2) is based on common questions of fact.

34 Patents pending/filed on/after 9/16/11 Prior commercial use defense for patents issued on or after 9/16/11 Before- Prior commercial use defense applied to Business Method patents Now, applies to all technologies Prior user right is a personal defense to infringement liability; it does not invalidate a patent. So if A sues B for infringement, and B successfully defends by showing prior use, A’s patent is still valid against others.

35 X is sued by University. X used tech > 1 yr b/f filing. UNVERSITY EXCEPTION- X can’t use defense X is sued by CORP, X used tech > 1yr b/f filing date, UNIVERSITY EXCEPTION- owned by U at time of filing, X can’t use the defense X is sued by U, X used tech > 1yr. Tech is not funded by FedGov, NO UNIVERSITY EXCEP- X uses the defense Prior User Rights – University Exception

36 9/16/2011 Effective Date Patents pending/filed on/after 9/16/11 Strategy for reducing, avoiding, or deferring tax liability is in the prior art - pending applications No claims to human organisms- pending applications Patent Term Extension- date of notification is extended

37 Actions/Challenges to Patents and Applications 9/16/ Supplemental Examination- any patent - before/on/after 9/16/ Pre-Issuance Submissions- any application - before/on/after 9/16/ Inter-Partes Review- any patent - before/on/after 9/16/2012 Transition period- higher standard- reasonable likelihood to prevail 4.Transitional Post Grant Review for validity of Business Method Patents 3/16/ Derivation Proceedings (Interference Proceedings) 2.Post-Grant Review

38 A Goal of AIA “One major aim of the reform legislation is to establish the USPTO as an alternative forum to U.S. district courts for vetting the validity of issued U.S. patents.”

39 Supplemental Examination USPTO Patent owners request supplemental examination of their own issued patents The procedure allows a patent owner to make submissions to the USPTO to correct mistakes in disclosures during prosecution Evidence disclosed by a patent owner to the USPTO during the supplemental examination cannot later be asserted by a defendant as evidence of inequitable conduct, provided the supplemental examination proceeding has concluded 9/16/2012

40 Supplemental Examination USPTO Within 3 months of receiving a request only from patent owner. If substantial new question of patentability is raised by at least one of the items cited in the request, PTO will order a reexamination of the patent. Can be used to “cure” not only simple oversights by patent owner but actual intentional failures to disclose prior art.

41 Supplemental Examination USPTO A purpose: limit inequitable conduct claims in litigation. Cannot be used to cure: (1) prior allegations of inequitable conduct in lawsuit before request is filed; and (2) defenses to a patent enforcement action raised before the supplemental examination is concluded.

42 3 RD Party Pre-Issuance Submission USPTO During prosecution, a third party may submit 1)Any patent, patent application 2)Other printed publication along with 3)Statement of relevance 4)Fee Consider the effects of this filing should later litigation occur 9/16/2012

43 Inter Partes Review (IPR)PTAB Who files Anyone other than patent owner When filed Nine months after patent issues or end of PGR Grounds for challenge Patents and printed publications Threshold Reasonable likelihood that petitioner would prevail on at least one of the claims challenged in the petition Duration of Review Within one year after initiation Patent Trial and Appeal Board 9/16/2012

44 Post Grant Rev of Biz M Patents PTAB What is it Request to cancel as unpatentable 1 or more claims of a patent Who files Person sued for infringement Applies to Patents with any effective date Grounds for challenge Prior art under old rules or new rules Creates ESTOPPEL in civil action- cannot use again When To File From 9/16/12 to 9/16/20 9/16/2012

45 Interference/Derivation Proceeding USPTO Interference applies to claims before 3/16/2013 effective filing date Declared by the patent office/requested by Applicant Instituted between an existing application and a patent/application claiming the same invention Can be declared anytime during the pendency of the patent application Current

46 Interference/Derivation Proceeding USPTO Derivation only for claims with 3/16/2013 effective filing date Started by a petition by patent owner against another patent owner with an earlier filing date Patent owner with earlier filing date must have derived invention from patent owner instituting the derivation proceeding Must be filed within 1 year of the issue date of the first patent alleged to have derived the invention or the publication of substantially same claims 3/16/2013

47 Post Grant Review (PGR)PTAB Only applies to patents with effective filing date of 3/16/2013 Who files Anyone other than Patent owner When filed Within 9 months of issue or broadening reissue Grounds for challenge Any ground of invalidity as well as prior art Threshold More likely than not that at least one challenged claim is unpatentable or there is a novel question of law Duration of Review One year with possible 6 month extension 3/16/2013

48 Reduced Fees for Micro entity Micro entities receive 75% fee reduction Who Qualifies? Applicant is paid/employed by institution of higher education or conveys some rights to institution Particular small entities Where the inventor not named as inventor on > 4 applications filed in US Excludes prior employment Gross income in prior year < 3x median household income No obligation to assign or convey to non-micro entity Effective on 9/16/2011, but fees must be set by USPTO

49 Advice of Counsel The Act codifies the doctrine created by federal case law, which provides that  neither the failure of an accused infringer to obtain the advice of counsel  nor the failure to present such advice to a court or jury  may be used to prove that the accused infringer willfully infringed a patent

Questions? Thank you! Ballard Spahr