America Invents Act Date of enactment: 9/16/11 First-to-file provisions effective 18 months after enactment – March 16, 2013 Applications filed on

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America Invents Act

Date of enactment: 9/16/11

First-to-file provisions effective 18 months after enactment – March 16, 2013 Applications filed on or after 3/16/13 are examined

under the AIA’s FITF provisions

Expanded § 273 defense under AIA applies immediately

AIA applies retroactively for false marking suits

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Significant Provisions in the Bill

First-to-invent becomes first-to-file Provides for “post-grant review” proceedings Provides for supplemental examination process Provides for IPR, a revised inter partes reexamination Expands §273 beyond business methods Extends time period for third party submission of prior

art Eliminates best mode as defense to infringement False marking and virtual marking

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First-to-File: Overview

First inventor who files a patent application will generally be entitled to the patent

Prior art fixed by filing date of the patent application

Prior art includes public use or sale in a foreign country, unlike old §102(a), (b)

“Swearing behind” prior art is no longer an effective technique for removing otherwise prior art

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First-to-File: Inventor’s Grace Period

The inventor is allowed a one-year grace period in which the inventor’s “disclosure” is not prior art

Derived disclosures eligible for grace period

Subsequent disclosure by third-party not prior art

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First-to-File: Effective Date

18 months after enactment – March 16, 2013

“Derivation” proceedings will determine inventorship beginning with effective date of AIA Governed by §135

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First-to-File and § 102(a)

New § 102: (a) NOVELTY; PRIOR ART.—A person shall be entitled to a

patent unless—(1) the claimed invention was patented,

described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention; or

(2) the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.

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First-to-File and § 102(b)(1)

(b) EXCEPTIONS.—(1) DISCLOSURES MADE 1 YEAR OR LESS BEFORE THE

EFFECTIVE FILING DATE OF THE CLAIMED INVENTION.—A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention under subsection (a)(1) if—

(A) the disclosure was made by the inventor or joint inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or

(B) the subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor.

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First-to-File and § 102(b)(2)

Section 102(b) exceptions continued: (2) DISCLOSURES APPEARING IN APPLICATIONS AND PATENTS.—A

disclosure shall not be prior art to a claimed invention under subsection (a)(2) if—

(A) the subject matter disclosed was obtained directly or indirectly from the inventor or a joint inventor;

(B) the subject matter disclosed had, before such subject matter was effectively filed under subsection (a)(2), been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or

(C) the subject matter disclosed and the claimed invention, not later than the effective filing date of the claimed invention, were owned by the same person or subject to an obligation of assignment to the same person.

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First-to-File

Example timeline

Under current first-to-invent system:Inventor B wins

C RTP File

C RTP File

Under new first-to-file system:Inventor A wins

Inventor B

Inventor A

“C” = Conception of invention“RTP” = Reduction to practice

of invention“File” = Application filed with

PTO

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Impact of AIA on Litigation

Calmedica case as example Under old statute, Fischell ‘166 patent was not prior

art (without additional evidence) even though he had earlier filing date (12/11/89 vs. 9/5/91) because Hess arguably had earlier DOI

Under AIA, Fischell ‘166 patent is prior art to Hess Hess can no longer swear behind it, as he did under

old statute

Prior art no longer dependent on date of conception, diligence, or reduction to practice

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First-to-File

Example timeline

Disclosure within grace period is not prior art

Timeline:

Inventordisclosesinvention

Application filed

1 year

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Under old statute, inventor can make a public use or offer to sell in U.S. less than one year before filing without it becoming a statutory bar If the inventor’s public use or offer to sell is outside the

U.S., there is no statutory bar regardless of time period

Under AIA, inventor can make a public disclosure less than one year before filing without it becoming a statutory bar If the inventor’s public disclosure is outside the U.S.,

there is a statutory bar if the disclosure occurred more than one year before filing

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First-to File

Example timeline

Third party disclosure is not prior art

Timeline:

Inventordisclosesinvention

Application filed

1 year

Third party disclosesinvention

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Under old statute, third party disclosure only had an impact if it preceded inventor’s DOI Third party disclosure after inventor’s disclosure would

have had no impact because it came after inventor’s DOI

Under AIA, third party disclosure before inventor’s disclosure, whose disclosure was within year of filing, is prior art

Under AIA, third party disclosure after inventor’s disclosure, whose disclosure was within year of filing, is not prior art

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First-to-file: Important results

Conception, diligence, reduction to practice, and abandonment no longer relevant to inventor priority

Interference proceedings eliminated

Brings U.S. in line with rest of world

Inventor’s pre-filing disclosure prevents subsequent pre-filing third-party disclosure from becoming prior art

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Post-Grant Review (PGR)

Bill implements a new post-grant review procedure to challenge the validity of an issued patent

Post-grant review must be initiated within nine months of issuance of patent

Standard for instituting: more likely than not that a claim is unpatentable, or novel legal question

Board has one year from grant of petition in which to enter a final decision

Challenge can be any invalidity defense

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Post-Grant Review: Benefits

Occurs before administrative patent judges (new Patent Trial and Appeal Board), not an examiner as with ex parte reexamination proceedings

Can include challenge to patentability on any ground, including those not allowed in reexamination

Evidence not limited to prior patents and printed publications

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Post-Grant Review: Limitations

Not allowed where DJ action previously filed, and civil suit automatically stayed where subsequently filed (encourages administrative challenges as opposed to litigation)

If post-grant review results in a final written decision, petitioner is estopped from requesting or maintaining another proceeding based on any grounds that were or reasonably could have been raised in post-grant review (which, as discussed above, includes all grounds of patentability)

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Possible that a significant amount of patent litigation will shift to the PTAB, particularly cases with validity defenses that lack sex appeal

If putative infringer opts for PGR and loses, he’s estopped from attacking validity in district court litigation

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Supplemental Examination Process (SEP)

Patentee may ask PTO to consider, reconsider, or correct information that may be relevant to the patent E.g., prior art not previously cited by applicant

If PTO concludes information does not raise substantial question of patentability, it cannot later serve as basis for challenging enforceability

If PTO concludes information does raise substantial question of patentability, patent enters reexamination

SEP not available if litigation pending

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Solves some Catch 22’s faced by prosecuting attorneys

May reduce frequency of inequitable conduct claims in district court

Increases likelihood that prospective plaintiff patentee will conduct internal investigation into possible inequitable conduct before asserting patent

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First-to-invent becomes first-to-file Provides for “post-grant review” proceedings Provides for supplemental examination process

Provides for IPR, a revised inter partes reexamination

Expands infringement defense beyond business methods Extends time period for third party submission of prior art Eliminates best mode as defense to infringement False marking and virtual marking

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Inter Partes Review: What Changes?

Review procedure: PTAB, not examiner (as in old inter partes reexamination)

Very limited discovery and oral hearing

Can petition within 9 months after issue

Cannot initiate if petitioner has filed DJ action challenging the validity, or if more than 1 year has passed since petitioner was served with a complaint

IPR must be completed within one year from institution

Appeals go directly to Federal Circuit

Estoppel attaches upon final decision of PTAB

Patent owner has right to stay co-pending litigation, subject to court approval

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Inter Partes Review: What Stays the Same?

Any patent can be challenged regardless of issue date

Grounds of invalidity remain limited to novelty and non-obviousness

Evidence remains limited to prior patents or printed publications

Standard of review for initiation of proceedings changed, but only in name: “reasonable likelihood that petitioner would prevail with respect to at least one of the claims challenged in the petition” vs. “significant new question of patentability”

Claims construed using “broadest reasonable interpretation”

Burden of proof: preponderance of the evidence

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PTAB viewed by many as the patent “death squad” Few patents have survived unscathed No presumption of validity BRI of claims means increased prospect of invalidating prior art Patentee effectively can’t amend claims Estoppel arises sooner APJ’s

Other factors making IPR’s attractive: 112, 101, 102/103 defenses not based on patents or printed publications Lower costs than district court litigation

Shorter duration than district court litigation

Prediction: net effect of IPR’s will be dramatic reduction in district court litigation in favor of IPR’s

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Section 273 defense

Current prior use defense under 35 U.S.C. § 273 limits defense to business method patents “It shall be a defense to an action for infringement [of] claims

for a method . . . if such person had . . . actually reduced the subject matter to practice at least 1 year before the effective filing date of such patent, and commercially used the subject matter before the effective filing date of such patent.”

“The term ‘method’ means a method of doing or conducting business.”

How might this happen without the prior use invalidating the patent? Inventor on patent conceived first

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Section 273 defense

The bill expands this defense to any subject matter

Limitations: Prior user must have commercially used the subject

matter in the U.S. at least one year before effective filing date of the issued patent and

Commercially used the subject matter in the U.S. at least one year before any inventor disclosure under the one year grace period

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First-to-invent becomes first-to-file Provides for “post-grant review” proceedings Provides for supplemental examination process Provides for IPR, a Revised inter partes reexamination Expands §273 beyond business methods Extends time period for third party submission of

prior art Eliminates best mode as defense to infringement False marking and virtual marking

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Extends Time Period for Third Party Submission of Prior Art

Permits public to submit relevant prior art to Patent Office during examination of application

Current MPEP rule limits time period to 2 months following publication of application (§ 1134.01)

Bill extends time period to the earlier of: The date a notice of allowance is given or mailed; or The later of 6 months after publication or the date of

the first rejection

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First-to-invent becomes first-to-file Provides for “post-grant review” proceedings Provides for supplemental examination process Provides for IPR, a Revised inter partes reexamination Expands §273 beyond business methods Extends time period for third party submission of prior


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Best Mode

Best mode still required by the PTO

No longer a basis for invalidity

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False Marking

A few years ago, numerous false marking cases were filed Prompted in part by Forest Group, Inc. v. Bon Tool

Co., 590 F.3d 1295 (Fed. Cir. 2009): Knowledge that a product was falsely marked is

sufficient to draw inference of deceptive intent; patentee’s mere assertion that it did not intend to deceive will not defeat liability

Congress decided to nix further suits by enacting a false marking provision in the AIA

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False Marking

The bill substantially changes the false marking statute: Eliminates false marking lawsuits except for ones

filed by the U.S. government or by a competitor who can prove competitive injury

Applies retroactively to all suits pending at time of enactment

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Virtual Marking

Allows markings that direct the public to a freely-accessible Internet address where a patented article is associated with its patent number to provide public notice that an article is patented

Markings can include “Pat.” or “Patented”

Easier to update website than tooling of a product when patent expires

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Additional Provisions

Lack of defensive opinion cannot be asserted by patentee as evidence of willful infringement Supplement to In re Seagate Technology (holding that

patentee must prove that defendant infringed despite an “objectively high likelihood that his actions constituted infringement of a valid patent, and this objectively-defined risk was either known or so obvious that it should have been known.”)

Opinion still can be used by accused infringer as evidence against willful infringement

Documents

America Invents Act Date of enactment: 9/16/11 First-to-file provisions effective 18 months after enactment – March 16, 2013 Applications filed on