Patent changes pending

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Raye Lynn Daugherty practices intellectual property law at Michael Best & Friedrich, LLP

Thomas Edison appeared to have the right approach when it came to ensuring his legacy and securing over 1,000 patents.

A pair of recent federal legislative proposals may make it easier to patent an idea of an invention, rather than the invention itself.

Suggested revisions to current patent laws have been made by both the U.S. Senate and House of Representatives. Considered the most significant changes since 1952, both proposals are designed to streamline aspects of the process and coincide with international patent laws.

In 2005, Representative Lamar Smith (R-Texas) introduced the Patent Reform Act of 2005 (H.R. 2795) and this August, Senators Orrin Hatch (R-Utah) and Patrick Leahy (D-Vermont) co-authored a 45-page bill known as the Patent Reform Act of 2006 (S. 3818).

“It’s hard to know if these reforms will really save our clients time and money going after infringers and fending off false claims of infringement,” said Amy L. Reichelt, chairperson-elect of the Intellectual Property Law Section of the Wis-consin State Bar. “I do believe, however, that these proposals, along with appropriate funding, could be a step in the right direction.”

First to Mail Would Prevail

Both bills are similar in their reform and include implementation of the internationally-embraced “first-to-file” system over “first-to-invent.”

Currently, the United States is the only country which gives priority to date of invention, rather than date of filing. The change would award patents to inventors who publish first and file their invention within 12 months.

The main goal of adopting a "first-to-file" system is to align U.S. patent law with European patent law, to streamline the patent process, and to strengthen patents by not allowing challenges regarding who was first to invent the subject matter of the patent.

“As a result, inventors will have to be more proactive in making sure they file patent applications as quickly as possible,” said intellectual property attorney Raye Lynn Daugherty at Michael Best & Friedrich, LLP, in Milwaukee.

Intellectual Property Attorney Joseph T. Leone of DeWitt Ross & Stevens, S.C., agreed that the system will ease administrative burdens, but force inventors to invent quicker methods of filing.

“First-to-file has one huge advantage over the present first-to-invent system, it’s easy to administer,” said Leone who is also a member of the IP law section board of the state bar. “It’s a pure race. The first outfit with an application on file at the PTO wins.”

While paperwork would be simpler to sift through, content could be less impressive because of the pressure to file first.

“If you’re moving really fast to file, mistakes happen,” noted Leone. “A patent application is not like filling in blanks on a form. It takes time and thought to move from a decent first draft, to a really fine, finished product. So first-to-file will certainly yield some degradation in the quality of the applications as filed.”

Leone, whose clients are primarily in the chemical field, noted that the proposal will especially hurt inventors in “unpredictable” fields like biotechnology and pharmaceuticals.

If an inventor is going to claim an active agent to treat a disease in humans, they need conclusive experimental data before they file a patent application. The process will likely be time consuming and filing with limited data may result in claim rejection by the Patent and Trademark Office (PTO).

“In other words, the claim gets denied because the application describes a desired result, but not how to achieve that result,” said Leone.

Punishing Persistence

A peripheral impact of the first-to-file change could be the limitation of continuations as outlined in the House of Representatives proposal (H.R. 2795).

As described in Section 8 of the bill, the director of the PTO would be authorized to regulate the circumstances under which continuations may be filed and be entitled to the priority date of the parent application.

“The new continuation rules will force inventors to decide on a particular strategy very early in the patenting process,” said Daugherty. “Inventors will be much more limited in their efforts to file additional patent applications on similar subject matter in order to obtain broader patent claims.”

Leone suggested that both big and small inventors would be stung by the change.

“The small, one-shot guy whose idea might get pushed into a corner because it’s not fully developed and without a continuance, never would be, and the really big multinationals that file tons of applications would both be affected,” said Leone. “The basic overall effect is to discourage multiple filings on a single invention.”

The bill would also attempt to stem abuse of the process and prevent inventors from filing continuations solely to keep their application pending, while blending commercially successful ideas into their claims.

Leone noted that a good portion of his clients rely on continuances because of the ever-changing face of their field. Additional filings are a necessity to ensure the patent, especially if a first-to-file system is implemented.

“The haste in which an application is filed is also directly proportional to the odds that you’re going to have to file a continuation application to fix the errors and omissions in the first application,” said Leone.

Saving Time and Money

Several possibilities for refining the roles of the PTO and attorneys are discussed in both bills, including a “post-grant opposition” procedure to provide a cheaper, more efficient method of contesting patent validity.

The process involves a requested third-party review within a nine-month window after the patent is granted. A decision must be reached within one year after which time either opponent may federally appeal the ruling.

The Senate bill also proposed a limited “second window” clause which offers another opportunity to challenge a patent’s validity. An alleged offender who has received notice of the infringement has six months to request a review.

Currently, federal law prevents consecutive challenges of patent validity.

“I do believe the proposed post-grant opposition system could be a more efficient and cost-effective way for our clients to defeat flimsy patent claims,” said Reichelt.

“Moreover, the proposed duty of candor and good faith for parties in a contested case before the patent office might help put some teeth in the proposed post-grant system.”

Specifically outlined in the H.R. 2795 bill, the PTO would demand all parties involved adhere to specific disclosure regulations. The system would eliminate defense of patent unenforceability due to inequitable conduct and theoretically decrease frivolous lawsuits.

“I don’t know that this will be a major change for the patent bar,” said Reichelt. “The post-grant opposition proposal is calling for mandatory disclosures, but we already have that requirement in federal court.”