Originally proposed in 2005, the America Invents Act
("AIA"), colloquially known as the "patent reform
bill," was signed into law on September 16, 2011. This
represents the most dramatic change to the U.S. patent law since
the 1952 revision. A spur to Congress to pass the bill and to the
President to sign it into law was a perception that
"reform" of the patent system has an important role to
play in stimulating the economy, creating jobs, and promoting U.S.
global competitiveness. The passage of time and retrospective
analysis is necessary to identify to what degree the AIA has had
the intended positive effects. However, the AIA undeniably has
changed the foundations of U.S. patent law, so that those who adapt
to this change may benefit, and those who do not will suffer.
The AIA affects decisions on what should be patented, when a patent
application should be filed, and how a patent application should be
filed. Patent applicants must be aware of the provisions in the new
law in order to optimize patent protection for the intended
business purpose and avoid pitfalls. Furthermore, the AIA includes
a complex transition regime; that is, different provisions of the
Act will replace corresponding provisions under the prior law at
different times in the future. Although the provisions of the AIA
will generally be implemented within the next 18 months, for
certain cases, provisions of the prior law may apply for many
years. Thus, for the immediate term, a patent applicant must
synthesize clear business objectives with a detailed understanding
of provisions under both the AIA and the prior law in order to
maximize the value of technical innovations. This article considers
only a few of the changes to the U.S. patent law affected by the
AIA, specifically, those that are understood to clearly impact the
procurement of patents. However, the aspects of the AIA that are
important depend on the facts and circumstances relevant to a given
applicant.
A substantial change under the AIA is the effective evisceration of
the "best mode" requirement. Under the prior law, an
applicant was required to include a description of the "best
mode contemplated by the inventor of carrying out his
invention." Most other countries do not have such a
requirement; one intent of effectively eliminating the "best
mode" requirement was to render the U.S. patent law more
"harmonious" with that of other countries. Although the
AIA leaves the text of this "best mode" requirement in
the law, it amends another section to state that "failure to
disclose the best mode shall not be a basis on which any claim of a
patent may be canceled or held invalid or otherwise
unenforceable." Thus, although the "best mode"
requirement is nominally still present, it is rendered
"toothless" in that there appears to be no penalty for
not satisfying it. However, it may remain for the courts to clarify
the intent Congress may have had in leaving the "best
mode" requirement nominally present, and to determine whether
it has any remaining practical effect. A prudent applicant will
thus consider that some risk may be born in not conforming to the
nominal "best mode" requirement. The provisions of the
AIA pertaining to the removal of the "best mode"
requirement came into effect on September 16.
Perhaps the most dramatic change is the transformation of the U.S.
patent law from a "first to invent" to a "first to
file" regime. Under the prior law, an inventor who was not the
first to file a patent application could, in some circumstances,
assert through an "interference proceeding" that he or
she was nevertheless entitled to a patent, by virtue of having been
the first to invent the claimed subject matter. Although only a
small fraction of patents and applications were contested under the
"first to invent" provision, it was criticized for adding
to the uncertainty born by patent applicants, complicating the
process of obtaining a patent, and being "inharmonious"
with the law of other countries. On the other hand, the "first
to file" system is perceived as being skewed toward favoring
corporations, which have the sophistication and resources to ensure
that patent applications are promptly filed for potentially
valuable innovations, over individual inventors and small
businesses. The AIA does provide for a "derivation
proceeding" by which an inventor who believes that another
"derived" his invention and filed for a patent can seek
relief. However, the time for a filing a derivation proceeding is
limited to one year from the issuance of the patent being
contested, or, if the contesting inventor has also filed a patent
application, one year from the first publication of the contested
claim.
The AIA makes significant changes to the tests imposed to determine
whether a claimed invention is "novel." Under the prior
law, an invention being "known or used by others" in the
United States, would preclude the issuance of a patent, but such
knowledge or use in foreign countries would not be a disqualifying
event. The AIA makes no such distinction between domestic and
foreign events, stating that the claimed invention being
"patented, described in a printed publication, or in public
use, on sale, or otherwise available to the public before the
effective filing date" precludes the issuance of a patent. The
AIA does retain a "grace period" under which
"disclosures" made by the inventor (or one having
obtained the subject matter disclosed from the inventor) one year
or less before the effective filing date of the application are not
disqualifying events. However, ambiguity remains, for example, as
to whether a "sale" or an offer for sale from the
inventor to another, not otherwise disclosed to the general public,
constitutes a "disclosure" entitled to the one-year grace
period. Numerous such interpretative issues are expected to arise
for later resolution by the courts. An important feature of the AIA
is that by "disclosing," for example, through
publication, his or her invention, the inventor not only has a
one-year "grace period" to file an application, but also,
is protected against being disqualified by another who
"discloses" thereafter. This has led some to comment that
the AIA has effectively established a "first to publish"
regime. Entities intending to seek protection for their innovations
internationally, should, however, continue to bear in mind that the
terms of and conditions for "grace periods" vary greatly
among jurisdictions, with some, such as Europe, providing for no or
only a very limited grace period. Thus, if there is any possibility
that protection outside the United States may be sought, prudent
practice is to file an application for patent before any
disclosure.
The AIA stipulates that the "first to file" regime and
associated changes to the tests for "novelty" will take
effect for claimed inventions having an effective filing date on or
after 18 months from enactment of the Act, that is, March 16, 2013.
However, this means that the prior law may continue to apply for
continuation applications that claim the benefit of priority of an
application filed 18 months prior to enactment of the Act. Thus, a
dual regime is likely to persist for years, with the prior law
applying to continuations and chains of continuations claiming such
benefit of priority.
A provision of the AIA that is relatively separate from other
aspects of the patent law is the implementation of a
"prioritized examination" track, which became effective
on September 26, 2011. Under this track, an applicant can pay the
substantial filing fee of $4,800 and submit a claim set not to
exceed four independent and 30 total claims, so that the U.S.
Patent and Trademark Office ("USPTO") will expedite
examination. The extent of the advantage afforded by
"prioritized examination" remains to be seen as it is
implemented by the USPTO. Ultimately, whether it is worthwhile to
pay the fee will depend on the applicant's business objectives
and circumstances.
The AIA dramatically alters the "playing field" for
obtaining patents. While the full space of strategic variants is
vast and important aspects will become apparent as the courts
interpret provisions of the Act in coming years, a few
possibilities can be considered.
For example, an applicant may consider filing a patent application
that does not disclose the invention's "best mode
invention." In some cases, it may be advantageous to seek
patent protection on general aspects of an invention, while
maintaining the "best mode" as a trade secret. A patent
application might be filed on the "best mode" at a later
time. Such an approach could stagger patent terms, and effectively
extend patent protection on the "best mode" beyond 20
years from the effective filing date of the invention's general
aspect application. However, in adopting such an approach, the
applicant may take several risks. First, another person might be
the "first to file" on the "best mode." Second,
the commercial application of a "best mode" process that
is maintained as a trade secret, but of which the resultant product
is sold may continue to be considered a "public use" that
disqualifies a patent. Finally, the courts assign practical
consequences to not complying with the vestigial "best
mode" requirement of the law.
As another example, an applicant that intends to only seek patent
protection in the United States may publish the invention to
prevent another from filing a patent application on it, wait the
full one-year "grace period," file a provisional
application, wait the full one-year life of the provisional
application, and then file a nonprovisional application. Under the
prior law an inventor could publish, and then have the one-year
"grace period" to file a patent application during which
the inventor's own publication would not be considered prior
art. The act of publication did not preclude another from filing a
patent application. Rather, who was entitled to the patent would
ultimately be resolved under the "first to invent"
standard. By contrast, under the AIA, if an inventor knows he or
she is the first to publish, there is certainty that only he or she
may receive a patent.
In summary, those concerned with the patent protection of
innovations should seek understanding of key provisions of the AIA,
monitor forthcoming implementation by the USPTO and interpretation
by the courts of provisions, consider strategic implications, and
be prepared to reconsider general conclusions of effects of the Act
in light of specific facts and circumstances.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.