Patent reform act moves U.S. to first-inventor-to-file system | submitted by Ted J. Barthel

On Sept. 8, the U.S. Senate passed HR 1249, the Leahy-Smith America Invents Act (AIA). The bill now goes to the President, who is expected to sign the AIA into law. President Obama’s signature will bring six-plus years of legislation on U.S. patent reform to an end. Many in the patent community view the new law as the most far-reaching change to patent law in over a century.

The new patent law is complex. Some changes take effect immediately, while other changes will be phased in over time, generally in 12 to 18 months. This is a summary of the law.

Fundamental changes

The new patent law has two key changes. First, under the new law, the U.S. patent system will become a “first-inventor-to-file” system, replacing the former “first-to-invent” system. This will harmonize the United States with most other countries in the world, which generally operate under a first-to-file patent principle. The new U.S. first-inventor-to-file provision will carry significant changes to what constitutes prior art and the pre-filing grace period. This change will be phased in over time.

Second, the new law provides an additional new procedure whereby a third party can challenge a patent once it is granted. This change will also be phased in over time.

Changes effective immediately

Following is a list of some of the changes that will take effect immediately upon the President’s signature to the AIA (enactment).

Patent Fees

  • A 15% surcharge will be imposed on most patent office fees (effective 10 days after enactment).
  • There will be a 75% reduction in most fees for a new category of “micro entities.”
  • A $4,800 ($2,400 small entity) fee will be charged for filing a prioritized patent application (effective 10 days after enactment).
  • A $400 fee will be established for non-electronic filing (effective 60 days after enactment).

Patent Office Procedures

  • Ban on human organism patents (will not apply to issued patents).
  • Ban on tax strategy patents (applies to applications pending on/after enactment and patents issued on/after enactment).
  • More stringent standard for filing inter partes re-examination requests. New: “reasonable likelihood requester will prevail.” Old: “substantial new question of patentability.”
  • Elimination of district court review for USPTO re-examination decisions. (Re-examination appeals limited to CAFC only.)

Patent Litigation

  • False marking (effective upon enactment and including pending cases). Virtual marking, via a website, will constitute effective marking. Standing limited to (i) the United States in seeking a penalty for false marking or (ii) a party that has suffered a competitive injury and the party’s relief will be limited to damages from that injury. Product marked with an expired patent will no longer constitute false marking.
  • Prior user defense available with respect to patents issued on/after enactment.
  • Joinder of unrelated accused infringers will be limited for actions filed on/after enactment.
  • Elimination of best mode infringement defense for actions filed on/after enactment.

Ted Barthel is an intellectual property attorney, shareholder, and a member of the Intellectual Property Practice Group of Whyte Hirschboeck Dudek.

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