Intellectual property lawyers have been advising clients to beware the Ides of March as they prepare to implement fundamental changes to U.S. patent law. Beginning March 16, the United States will go to a “first-inventor-to file” patent system, a major change from the “first-to-invent” system that has existed ever since the nation’s patent laws were enacted in 1790.
“It’s a big paradigm shift,” said Erica Arner, chair of the patent prosecution practice at Finnegan, Henderson, Farabow, Garrett & Dunner. “And there’s a ‘Race to the Patent Office’ mentality going with it.”
The first-to-invent principle, which has ruled the patent system since the first U.S. Patent Act was established in accordance with the U.S. Constitution, is designed to award a patent to the first person to invent a claimed invention—even if a later inventor beats the first inventor to the patent office. Under the new patent system, however, a patent will be awarded to the first inventor to file, regardless of whether someone else came up with the invention first.
The change, made as part of the 2011 America Invents Act after decades of debate, is intended to simplify and streamline the complex U.S. patent system, which has invited increased litigation in recent years. It will also make the U.S. system consistent with patent processes throughout the world. The U.S. is one of the only countries in the world that still uses a first-to-invent system.
But change breeds uncertainty. Many attorneys believe the new system may make obtaining a patent more difficult. The definition of what constitutes prior art—a key factor for determining patentability—will broaden, for example. And a one-year grace period to file a patent that inventors could take advantage of under the old system will all but disappear. In addition, attorneys say that under the new system a patent may be at greater risk of being invalidated.
“There are still a lot of unanswered questions that ultimately may be decided in court,” said Patrick Waller, a partner at Wolf Greenfield who counsels clients in patent prosecution. “So companies want to file as many applications as possible now—before the change.”
The last day the U.S. Patent and Trademark Office will consider a filed patent application under the old law is March 15 (a day Shakespeare fans know well as the Ides of March), and patent lawyers say they have been putting in extra hours with clients. They are encouraging potential patentees to review their inventions and decide whether they are ready for patenting.
“We’re pushing to get them to file before March 15 if they’re ready, because the deadline is midnight on the 15th—and the PTO’s website has been known to go down periodically when there’s too much activity,” said Jason Cooper, an intellectual property attorney and partner at Alston & Bird in Atlanta.
Why the rush? Some of the fundamental rules of the patent game are changing. For example, a big factor in determining patentability is prior art—historically comprised of prior patents or publications. But the definition of prior art is about to broaden, potentially creating a more difficult standard for patentability.
Under the current system, prior art includes information that is “known or used by others” before an invention is conceived. As of March 16, prior art will include any information that is “available to the public” before the filing date.
In addition, prior art under the old system includes public uses or sales that have occurred within the United States. As of March 16, however, they will include uses or sales that have occurred anywhere in the world, Cooper said.
Finally, prior U.S. patents and published applications that under the old system constitute prior art as of the earliest filing date within the U.S. will, under the new system, constitute prior art as of the earliest filing date anywhere in the world. And whereas international applications have only been deemed prior art if they are published in English, they will under the new law be considered prior art regardless of their language of publication. “Geographic restrictions for prior art are being removed, so there will be more ways to challenge a patent,” Arner said.
Prior art isn’t the only change creating patent anxiety, though. Currently, inventors can avail themselves of a grace period that gives them up to one year to file a patent application on an invention, even after someone else publishes or sells the invention. Under the new system, the one-year grace period will only protect an inventor from disclosures made by the inventor or by someone who obtained the disclosed subject matter from the inventor.
Another major worry is the new post-grant review process that will be available as of March 16. The new law says that within nine months of issuance, patents granted under the first-inventor-to-file system can be challenged by anyone on any grounds that would be available before a federal court. The challenge would be heard by the PTO’s Patent Trail and Appeal Board, whose judges generally have technical expertise. Attorneys anticipate that this post-grant review process, which would be less costly than federal court litigation, could become a popular and effective way to challenge patents.
“We won’t see the effect of this change for at one or two years, because it generally takes that long for a patent to issue,” said Matt Kreeger, a patent attorney and partner at Morrison & Foerster in San Francisco. “But there will be more opportunities to challenge patents with post-grant review in place.”
Despite the uneasiness, the first-inventor-to-file changes will not be quite as dramatic for large companies as some GCs fear, attorneys say. “If they have international interests, they already operate in a world of first-to-file to ensure protection,” said Waller. “It’s the smaller inventors who aren’t patent savvy or who don’t have the money for lawyers and patent filings who could wind up losers in the new system.”
Independent inventors will, however, be able to avail themselves of the PTO’s new micro-entity discount (75 percent) for a patent application if the applicant meets specified criteria.
The fallout from changes taking place with the full implementation of the America Invents Act remains to be seen. Attorneys expect the new law will raise questions that will need to be resolved through litigation.
But in the meantime, the major change brought on by the new law is the need for attorneys to educate their clients, attorneys say. “Companies will have to put more pressure on their inventors to file sooner,” Arner said. “They have to understand that the invention date is no longer part of the application—that it no longer matters.”