January 2013 Issue

Rule Review

Congress Attempts to “Correct” and “Improve” the AIA and Patent Law

Congress has just revised the momentous Leahy-Smith America Invents Act (AIA), which upon enactment on September 16, 2011, began a multistage implementation process.  On November 30, 2012, Representative Lamar Smith (R-Texas), one of the legislators for whom the law is named, introduced a bill “[t]o correct and improve certain provisions of the Leahy-Smith America Invents Act and title 35, United States Code.”  That bill, H.R. 6621, passed the House of Representatives in a vote of 308-89 on December 18, 2012.  On December 29, 2012, amid the fervor in Congress over the notorious “fiscal cliff” and the pressing need for legislation to address it, the Senate unanimously passed an amended version of H.R. 6621 (S. Amendment 3444) sponsored by Senator Patrick Leahy (D-Vermont), which the House then passed on January 1, 2013.  The legislation was signed into law by President Obama on January 14, 2013, and changes several features of the AIA and other provisions of patent law relating to post-grant proceedings and patent prosecution.

With respect to the new post-grant review (PGR) and inter partes review (IPR) procedures created by the AIA, the new legislation eliminates the nine-month “dead zone,” during which certain patents were not available for PGR or IPR.  In particular, the provisions of the AIA that changed U.S. patent law to a first-inventor-to-file (FITF) regime (rather than first-to-invent (FTI)) take effect on March 16, 2013.  Prior to the revisions, patents that issued under the old FTI regime were ineligible for PGR (35 U.S.C. § 321(c)) and were not available for IPR until nine months from their issue date (35 U.S.C. § 311(c)).  Congress addressed this nine-month limbo period by permitting IPR for FTI patents within nine months after their issuance.  Of course, IPR continues to be available beyond the nine-month period for all patents, except where a PGR is in process.

The new legislation also changes patent term adjustment (PTA) rules in several respects.  Currently, under 35 U.S.C. § 154(b)(1)(B), PTA can be granted when an application is pending for more than three years from “the actual filing date of the application in the United States.”  Under the new law, the starting date for the three-year period is the actual U.S. filing date for applications filed under 35 U.S.C. § 111(a) or the commencement of the U.S. national stage under § 371 for international applications.  National stage in the U.S. commences when thirty months from the priority date have passed, unless the applicant has requested an earlier commencement and the requirements of § 371(c) have been met, including, among other things, the filing of an oath or declaration.  35 U.S.C. § 371(b), (f).  In addition, under the new law, notices of PTA will be sent no later than issuance of a patent, rather than the current practice of sending the notice of PTA together with the Notice of Allowance.  The new law also provides that the exclusive remedy for challenging PTA determinations, following a request for reconsideration, is an appeal to the U.S. District Court for the Eastern District of Virginia.

The new law further changes the time period in which an inventor’s oath or declaration must be filed.  Under the original AIA version of 35 U.S.C. § 115(f), such filings had to be made before a Notice of Allowance could issue.  Under the new law, the filings may be made until the date on which the issue fee is paid.

In addition, the new law repeals 35 U.S.C. § 373, which provided that the U.S. Patent and Trademark Office (USPTO) could not accept an international application designating the United States if it was filed by someone who was not qualified to file a U.S. patent application under § 111 (i.e., someone other than an inventor).  With 35 U.S.C. § 373 eliminated, more flexibility is provided to applicants in coordinating the filing of international applications in the United States.

Finally, it is important to note one aspect of patent law that Representative Smith’s proposed bill would have changed but will remain unchanged by virtue of Senator Leahy’s amendment.  According to H.R. 6621, the term of patents issuing from applications filed before June 8, 1995, that were still pending one year after the enactment of the proposed bill would be twenty years from their earliest filing date.  That would have meant a significant reduction in patent term for such applications compared to the current law, which provides for a term that is the greater of twenty years from the earliest filing date or seventeen years from issuance.  These provisions of H.R. 6621 were removed by the Senate and are not part of the new law.

The changes in the new legislation have several important implications for practitioners.  For those seeking to challenge newly issued FTI patents, not only is ex parte reexamination an option, but IPR is available as well.  An increase in IPR filings may be expected as a result.  Applicants also have more flexibility in filing oaths or declarations later in the application process, including as late as payment of the issue fee.  Nevertheless, if applicants want to commence the national stage early and start the clock that allows for PTA based on more than three years of USPTO delay, the oath or declaration should be filed as soon as possible.  It also remains advisable to obtain and file such papers early, since inventors can become difficult to contact and less cooperative over time.  In addition, with the elimination of 35 U.S.C. § 373, practitioners have more freedom filing international applications in the United States without the constraints regarding who files the application.  Of course, international applications still must comply with 35 U.S.C. § 371, which specifies the requirements for an international application to enter the national stage in the United States.