Alert: U.S. Patent Reform Enacted

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September 19, 2011

President Obama signed the America Invents Act (the “Act”) on September 16, 2011, thereby enacting the most significant changes to U.S. patent law in almost 60 years.  A primary change brought about by the Act is the shift from a first-to-invent to a first-to-file system.  Under a first-to-file system, the first inventor to file a patent application is entitled to a patent on that invention.  This brings the U.S. patent system in line with most other countries and increases the incentive to expeditiously file a patent application.

The Act also creates a new preissuance submission procedure which provides any third party the opportunity to submit certain prior art for consideration by the patent examiner before the patent is issued.  Specifically, interested third parties will be able to submit patents, published patent applications or other printed publications of potential relevance for consideration during examination.  The submission must include a concise description of the relevance of each submitted printed publication. 

The Act also significantly changes the procedures for post-issuance review of patents.  Patent owners will now be able to request supplemental examination of a patent to allow information believed to be relevant to the patent to be considered, reconsidered, or corrected.  For example, if a patent owner fails to submit certain information to the USPTO during the original examination, supplemental examination provides the opportunity to correct that failure and thereby increase the enforceability of the patent. 

Post-grant review will allow any third party to challenge the validity of a patent within nine months from the date a patent is granted.  The threshold showing required for a petition requesting post-grant review to be granted is that it is “more likely than not” that at least one of the challenged claims of the patent is unpatentable.  Alternatively, a post-grant petition may be granted if it raises a “novel or unsettled legal question that is important to other patents or patent applications.”  These proceedings will be conducted relatively quickly and will bar the petitioner from raising the same invalidity arguments in a subsequent civil action.  Accordingly, third parties will be forced to choose between challenging validity in post-grant review proceedings or in court.  

Inter partes review proceedings will allow third parties to challenge the validity of a patent nine months after a patent is granted, or after the completion of any post-grant review.  Inter partes review replaces the current inter partes reexamination system.  The main difference between the new inter partes review and the old inter partes reexamination is a heightened standard for instituting proceedings.  A petition for the new inter partes review will not be granted unless there is a “reasonable likelihood” the petitioner will prevail in challenging validity.  In contrast, the old inter partes reexamination only required the existence of a “substantial new question of patentabiliy.”           

The Act also makes patents more expensive.  The Act imposes a 15% increase on all statutory patent fees.  To incentivize electronic filing, an additional fee of $400 ($200 for small entities) will be charged for each utility application filed in paper form. 

The Act brings about many other changes, including but not limited to the following:

  • The failure of a defendant to obtain the advice of counsel with respect to an allegedly infringed patent may not be used to prove willful infringement.
  • Marking a product with the number of a patent that covered the product, but which has expired, is not a violation of the false marking statute.  False marking actions may only be brought by either a party who has suffered a competitive injury from false marking, or by the United States. 
  • The failure to disclose the best mode for carrying out an invention can no longer be used as a defense in an infringement action. 
  • New requirements for joinder provide that accused infringers may not be joined in one action based solely on the alleged infringement of the same patent.  These new requirements will have a major effect on infringement actions brought by non-practicing entities.

Various provisions of the Act will come into effect at different times.  Some changes take effect immediately, while others take effect in 12 to 18 months. 

The Act constitutes significant legislation which affects virtually all aspects of patent prosecution and litigation strategy.  The details regarding the implementation of this Act are still to be determined, as various provisions take effect and the rules implementing the Act are promulgated.  Briggs and Morgan’s Intellectual Property Group welcomes the opportunity to guide you through the process of maximizing the value of your patent portfolio in light of the America Invents Act.

For more information, please contact your Briggs and Morgan attorney, or a member of our Intellectual Property practice group.