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Significant changes to US Patent Law - Quick Guide

Date: 22 September 2011
Author: Charles Berman, Karin Innes
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On Friday 16 September 2011, President Obama signed into law the Leahy-Smith America Invents Act (AIA) which makes significant changes to US Patent law.  So that our clients can better understand the impact these changes will have on their patent filing and prosecution strategies, we have distilled the major changes below:
 
Changing from “first to invent” to “first to file” system - effective 16 March 2013
  • Applications having a priority date of 16 March 2013 or later will be subject to the first-to-file system instead of the current first-to-invent system.  Thus priority will be awarded to the Applicant who is first to file an application covering an invention.  This brings the law of the USA into line with patent laws throughout most of the world.
  • One year grace period will remain so that the Applicant’s own disclosures within one year of filing the application are not prior art.
  • Inventors will no longer be able to swear behind prior art nor will they be able to establish priority in an interference proceeding.
  • A newly created Derivation Proceeding may be used where an original inventor alleges that a patent Applicant derived the invention from the original inventor’s work.  This is intended to replace costly and protracted Interference Proceedings.
 
Increase in Fees - effective from 26 September 2011
  • A 15% surcharge will be added to most patent related fees including filing fees, examination fees, and maintenance fees.
  • Expedited/prioritised examination can be requested for a fee of USD$4,800 (large entity) and USD$2,400 (small entity).
 
Inter Partes Review process - effective 16 September 2012
  • The standard that must be satisfied for granting a Request for Re-examination will change from a “substantial new question of patentability” to a “reasonable likelihood that the requestor will prevail” in connection with at least one of the claims in question.  This process will replace the current Inter Partes Re-examination process and will be available 9 months after grant or after conclusion of a newly introduced opposition-like post grant review process (discussed in the following paragraph).  A reasonably high threshold of a "reasonable prospect of success" is required before the review will be considered.  The review is limited to consideration of novelty and non-obviousness issues based only on prior art consisting of patents and printed publications.
 
New post-grant review procedure - effective 16 September 2012
  • Similar to the post-grant opposition process in Europe. A third party may petition the US Patent Office within 9 months from grant/issuance of a patent to review the validity of a patent.  All grounds of invalidity may be considered, including patentability of the invention, novelty, non-obviousness, pre-filing date activity and/or failure to comply with the written description and enablement requirements.  If an Opponent has instituted an opposition proceeding, that Opponent may not, subsequently, make a request for re-examination of the same claims based on the same issues that were the basis of the opposition proceedings.  Post-grant review will apply only to patents granted under the first-to-file provisions.
 
Prior User Rights - effective immediately
  • Defendants in litigation may be able to assert prior user rights based on commercial use of the subject matter of a patent application filed in the USA.  This is similar to the prior user provisions under Australian law.
 
Micro-entity status - effective immediately
  • Micro-entities are entitled to a 75% fee reduction.  To claim the new micro-entity status, an Applicant would have to not only qualify under the small entity guidelines, but must further assert: that the Applicant has not been named as an inventor in more than four previously-filed US patent applications; that the Applicant's annual income does not exceed three times the US median income; and that the application is not assigned or subject to be assigned to an entity having an income over three times the US median income. 
 
Pre-issuance third party submissions - effective 16 September 2012
  • Third parties may submit any printed publication along with a description of the relevance to the USPTO to be considered during the examination of a pending patent application.
 
Best Mode - effective immediately
  • Although the inventor will still be required to set forth the best mode for accomplishing the invention, failure to disclose a best mode can no longer be used as a basis for invalidating an issued patent.
 
Oath or Declaration - effective 16 September 2012
  • A corporation can file a substitute inventor’s oath when the inventor is non-cooperative.
  • An application can now be filed in the name of an Applicant other than the inventor, for example, in the name of a company or other assignee.  At present only the inventor can apply in the US with subsequent assignment to an assignee if necessary.
 
Repeal of Statutory Invention Registrations (SIR) - effective 16 March 2013
  • The ability to file an SIR, a mechanism to publish an invention in a novelty-destroying manner, will fall away as at the above effective date.
 
Review of Business Method Patents -  effective 16 September 2012
  • A transitional post-grant review procedure for reviewing the validity of covered business method patents is to be established. A “covered business method patent” is “a patent that claims a method or corresponding apparatus for performing data processing or other operations used in the practise, administration, or management of a financial product or service."  The term does not include patents for technological inventions.  In terms of the procedure, a person of interest may file a petition if that person has been sued for, or charged with, infringement of the business method patent. If the review is unsuccessful, the petitioner will not be able to assert in subsequent proceedings that a claim of the patent is invalid on any ground raised during the post-grant procedure that resulted in a final written decision.
 
Conclusions
 
Most of the changes are designed to make it easier and more cost effective to challenge the validity of third party applications (through pre-issuance submissions) or issued patents (through post grant review).  Perhaps the most significant impact of these changes for Australian Applicants is that the change to a first-to-file system will do away with the practice of filing a US provisional application in order to secure an earlier effective US filing date for the purpose of determining relevant prior art.
 
 
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