March madness: Patent firm gears up for new reforms coming next month

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 By Sheila Pursglove

Legal News
 
Beware the Ides of March on March 15—or rather, “be aware” of the day after, when new provisions of the America Invents Act go into effect March 16; they include changing “first to invent” to “first to file.”
 
“The new law now makes the first to win the race to the Patent Office as the winner,” says Monte Falcoff, a patent lawyer and principal at Harness, Dickey, & Pierce in Troy, who represents large, medium and small U.S. and foreign companies and universities in a wide range of technical areas. “The unfortunate part is that this will cause more conceptual inventions to be filed in patent applications which will hinder a significant objective of the U.S. patent system: to publicly disseminate enabling technical knowledge. But this does harmonize the U.S. laws closer to those of most foreign countries, for better or worse.”
 
According to Falcoff, this is the most significant change in U.S. patent law since the revolutionary 1952 Patent Act.
 
He advises that general practice attorneys who counsel businesses (especially those without in-house patent attorneys) and independent inventors should now inform their clients that it is no longer advantageous for them to wait on filing their patent applications until the invention is fully developed and tested. 
 
Also out the door—and the revision with the biggest real impact, according to Falcoff—is the traditional one-year grace period within which inventors/companies can market test their inventions before having to file the patent application—allowing them to ascertain if they can obtain enough business to justify the investment in patenting.
 
“With a notable but very unclear personal exception for inventor ‘disclosure,’ this grace period is now gone—depending on how the courts later interpret the exception,” Falcoff says. “Once the new law takes effect on March 16, it’s recommended that the patent application be filed first before any offers for sale or public uses of the invention. Also, if such market testing has already occurred then the patent application should be filed before the new law implementation date.”
 
According to Falcoff, with the new changes, U.S. patents will now be some of the most difficult to obtain in the world. 
 
“More prior activities and references will qualify as legal ‘prior art’ under the new rules than the old ones,” he explains. “Thus, the inventions must be novel and nonobvious over a greater body of knowledge. While this may cause some additional hurdles in the Patent Office, it will certainly be easier to invalidate patents once they are litigated.”
 
Foreign language PCT patent applications that are not nationalized in the U.S, and non-U.S. offers for sale and public uses will also become “prior art” under the new law, and there will be a significant advantage in filing new regular utility, U.S. patent applications (or PCT applications designating the U.S.) before the March 16 date, Falcoff notes. 
 
The more than 110 patent lawyers on the Harness Dickey team have been working hard on the rush of applications this has caused, he says, and are providing advice as to whether any of the new rules are beneficial or not for a client’s particular situation. The firm also has prepared a reference manual of more than a 100 pages, packed with practical recommendations and examples, to help clients understand the upcoming changes.
 
The new rules follow on the heels of historic patent reform implemented by the U.S. Patent and Trademark Office last fall, when numerous provisions of the Leahy-Smith America Invents Act of 2011 went into effect—intended to spur innovation and economic growth by streamlining the patent application process and introducing new procedures to ensure patent quality.
 
The seven reforms to U.S. patent law that went into effect one year after the signing of the bipartisan patent reform legislation by President Barack Obama on September 16, 2011, included three new administrative trial provisions—inter partes review, post-grant review, and the transitional program for covered business method patents—to offer third parties timely, cost-effective alternatives to district court litigation to challenge the patentability of an issued patent. 
 
“We’re already using these procedures for clients who have been sued or threatened, or who are defending their patents,” says Falcoff, who also teaches Intellectual Property law at Michigan State University College of Law.
 
Last fall’s supplemental examination provision allows applicants to submit additional information relevant to the patentability of an issued patent to the office in a new procedure that may protect the patent from an inequitable conduct charge. The inventor’s oath and declaration provision allows—for the first time—assignee filing of a patent application. And the citation of prior art and written statements provision enabled the office to treat the claims in a patent consistent with how a patent owner represents its claims to the courts or in other office proceedings.
 
The new rules do simplify what is and isn’t “prior art” and better reflect the real international business environment with easy Internet access to information, Falcoff notes.
 
“It also attempts to make post-issuance patent invalidity challenges less costly by encouraging such battles in the Patent Office rather than courts—it will be interesting to see how much these new procedures will be used,” he says. “Regardless, most patent attorneys believe the old rules are more favorable than the new ones, so inventors should file their new patents now!”

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