Every now and then I have an application that is subject to a secrecy order by the government that restricts disclosure of the invention and prevents the publishing or granting of a patent. I noticed that a current application being held up really doesn't seem to contain sensitive information but the application may have triggered the order itself by making a reference in the description that one of its many uses could be by the military. It would be analogous to an invention for an improved water bottle that you might describe as being beneficial to the military (a group that often needs bottled water in far away places) but that really is ordinary, everyday technology.

If you don't know, the Invention Secrecy Act of 1951 requires the government to impose secrecy orders on certain patent applications that contain sensitive information, thereby restricting disclosure of the invention and withholding the grant of a patent. This requirement can be imposed even when the application is wholly created and owned by a private individual or company without government sponsorship or support.

There are several types of secrecy orders which range in severity from simple prohibitions on export (but allowing other disclosure for legitimate business purposes) up to classification, requiring secure storage of the application and prohibition of all disclosure. A secrecy order withholds the grant of a patent, orders that the invention be kept in secrecy and restricts filing of foreign patent applications.

It seemed to me that the number of secrecy orders has been on the rise. It turns out, I'm not the only one that thinks the government is keeping more secrets since 9/11. At the end of fiscal year 2006, there were 4942 secrecy orders in effect, some of which have been in effect since the 1930s. Even the NSA had nine of its patent applications blocked in the fiscal year to March 2005 against five in 2004, and none in each of the three years up to 2003.

This week, I received a note from a reader about information on secrecy orders posted by the Federation of American Scientists (FAS), a group formed in 1945 by atomic scientists from the Manhattan Project who felt that scientists, engineers and other innovators had an ethical obligation to bring their knowledge and experience to bear on critical national decisions, especially pertaining to the technology they unleashed, i.e., the Atomic Bomb. Endorsed by 67 Nobel Laureates in chemistry, economics, medicine and physics, FAS addresses a broad spectrum of issues in carrying out its mission to promote humanitarian uses of science and technology.

Secrecy orders provide a security procedure to prevent technical data contained in a patent application from being disclosed in a manner that would be detrimental to the national security. Secrecy orders are imposed by the PTO upon specific recommendation by defense agencies, including the Army, Navy, Air Force, National Security Agency, Department of Energy and National Aeronautics and Space Administration.

The PTO conducts an initial security screening of all patent applications. Government-owned applications are not reviewed by the PTO for technical content. It is the responsibility of the cognizant defense agencies to review their own applications and recommend a secrecy order to the PTO where appropriate.

Applications in which there is no apparent government property interest are made available by the PTO to defense agencies for their inspection when, in the opinion of the Commissioner of Patents, disclosure might be detrimental to the national security. If, upon inspection, a defense agency determines that disclosure "would be detrimental" to the national security, it may recommend that the Commissioner of Patents place a secrecy order on the application.

When the Secrecy Order issues, the law specifies that the subject matter or any material information relevant to the application, including unpublished details of the invention, shall not be published or disclosed to any person not aware of the invention prior to the date of the Order, including any employee of the principals except as permitted by the Secrecy Order. The law also requires that all information material to the subject matter of the application be kept in confidence, unless written permission to disclose is first obtained from the Commissioner of Patents and Trademarks except as provided by the Secrecy Order. Therefore, the subject matter under Secrecy Order is to be safeguarded under adequate protection to prevent access by unauthorized persons.

I suppose we should not get too worked up about this given the lengthy history. Concerns about invention secrecy and national security date back to the First World War. In an effort to address the government’s concerns, Congress passed the act of October 6, 1917. The Invention Secrecy Act of 1951 created 35 U.S.C. sections 181 through 188, entitled Secrecy of Certain Inventions and Filing Application in Foreign Countries. Section 181 deals with the conditions set forth by a secrecy order, namely that the order shall last one year, or in the event of war, for the duration of the hostilities plus one year, on in the time of a national emergency (as declared by the president), for the duration of the emergency plus six months, all orders being renewable.

Section 181 also sets out that the applicant may appeal the issuance of a secrecy order to the Secretary of Commerce. Section 182 provides that in the event of an unauthorized disclosure of the contents of a secret patent, the inventor forfeits all rights to a patent to which he might have otherwise been entitled. Section 183 outlines the conditions for an inventor’s right to compensation, which is valid for six years from the date of issue on the patent, and includes compensation for government use, and for damages caused by the secrecy order. Section 184 states that any applicant must not file in a foreign country for six months after filing in the United States, to allow proper review of the invention for its relevance to national security. Section 185 applies the same penalties for foreign filing as for an unauthorized disclosure (as outlined in section 182). Section 186 describes the penalties for any violation of the secrecy order, which are up to $10,000 or two years in prison, or both. Section 187 exempts officers and agents of the United States from these prohibitions. Section 188 lists the persons who may wield secrecy orders, which include the Atomic Energy Commission, Secretary of Defense, Secretary of Commerce, and the heads of any government agencies the President designates.

More on secrecy orders on patents here.

Overview of all types of secrecy orders here.

35 U.S.C. §181. Secrecy of certain inventions and withholding of patent.

I received the following note from a reader asking if anyone would have suggestions on the following fact pattern:

I am preparing a petition to revive a US application that has gone abandoned, we think unintentionally. There are a number of case specific issues, which are not expressly provided for in MPEP 711.03. In particular, there appears to have been a mis-communication between the agent of record, at the time the application went abandoned, and the Applicant about the importance of a particular limitation in a claim element. The application went abandoned in favor of a subsequently filed CIP to add some limiting language to the specification and claims; this as a result of the mis-communication (and poor advice from the then agent of record). The CIP issued as a patent, but it now turns out that the licensee in charge of manufacturing the product believes that the product covered by the now abandoned application should have been the one to enter the marketplace and not the one covered in the issued patent. Finally, and probably a lost cause in light of MPEP 711.03, the application before it went abandoned went through three rounds of prosecution in which it received numerous 103(a) rejections, all essentially based on the same piece of art. The arguments which were put forth by the agent to address the rejections were inappropriate for this type of rejection, and thus led the Applicant to chose the abandonment route rather than continue prosecution.

Have any of your blog readers encountered such a problem and if so, were they successful in petitioning the Commissioner to revive the application?

The broadening reissue application allows you to go back to the USPTO once the patent is issued whenever there has been an error made and the inventor did not get all of the inventions (or the breadth of the invention) that he or she was entitled to. There are some requirements. First, the error must have been made without any deceptive intent. Second, the broadening reissue application, however, must be filed within two years after the patent issues. After that, it is too late. See 35 U.S.C. §251.

A broadened reissue claim is a claim which enlarges the scope of the claims of the patent, i.e., a claim which is greater in scope than each and every claim of the original patent. If a disclaimer is filed in the patent prior to the filing of a reissue application, the disclaimed claims are not part of the "original patent" under 251. A claim of a reissue application enlarges the scope of the claims of the patent if it is broader in at least one respect, even though it may be narrower in other respects.

Anyone have other suggestions here?

On April 20, 2006, Amgen filed a lawsuit against Ariad in the U.S. District Court for the District of Delaware seeking a declaratory judgment that each of the claims contained in U.S. Patent No. 6,410,516, covering methods of treating human disease by regulating NF-κβ cell-signaling activity, are invalid and that Amgen has not infringed any of the claims of the ‘516 Patent based on activities related to Amgen’s products, Enbrel® and Kineret®.

The '516 patent claims methods of treating disease by regulating a family of molecules known as NF-κβ. While Ariad contends that the patent covers all means for modulating the NF-κβ pathway, Lilly's contention is that it discovered the drugs in question, Evista and Xigris and disclosed their medicinal properties years before the patentees' scientists made their discovery. Ariad asserts that the claims of the '516 patent cover "methods of treating human disease by regulating NF-κβ activity," "methods of treating disease by inhibiting NF-κβ," and "methods useful for treating various disease conditions through modulation of NF-κβ activity."

On April 4, 2005, Eli Lilly and Company filed an ex parte request in the United States Patent and Trademark Office, or PTO, to reexamine the patentability of certain claims of the ‘516 Patent. In addition, an unrelated third party filed an ex parte request in the PTO on December 2, 2005 to reexamine the patentability of certain claims of the ‘516 Patent. The PTO has granted both of these reexamination requests. On April 4, 2006, counsel for the patentees of the ‘516 Patent filed separate Petitions requesting the PTO to merge these two reexamination requests, which were granted by the PTO on May 4, 2006. Additionally, on April 7, 2006, counsel for the patentees of the ‘516 Patent filed a third ex parte request in the PTO with respect to one claim of the ‘516 Patent, which was denied by the PTO on May 5, 2006. As a result of the PTO orders described above, Lilly’s ex parte request has been merged into a single action to look at the patentability of certain claims of the ‘516 Patent by newly cited references which (i) either inherently or expressly disclose the use of a variety of prior art compounds as reducing NF-κβ activity and resulting gene expression, or (ii) are directed to the use of oligonucleotides having an NF-κβ binding site for reduction of NF-κβ activity (Reexam. C.N. 90/007,503).

The Examiner has now rejected 160 of the 203. In a quite lengthy and detailed 66- page Nonfinal Office Action, the Examiner rejected various subsets of claims as anticipated and/or obvious in light of a long list of prior art references. For example, many claims were rejected over Meichle (J. Biol. Chem. 265 (5/90) 8339-43), which teaches the reduction of NF-κβ activity in induced cells using agents that inhibit protein kinase C. In addition, because Meichle used the HIV LTR in their experiments, this reference anticipates, or alternatively, makes obvious claims drawn to regulating expression of viral genes.

The Examiner contends that the ‘516 claims are drawn to reducing NF-κβ activity in eukaryotic (e.g. claims 1 or 2) or mammalian cells (e.g. claim 11) to effect inhibited expression of a gene under transcriptional control of NF-κβ. For example, NF-κβ activity can be effected by diminishing induced NF-κβ mediated intracellular signaling (claims 6-9) to inhibit associated gene (viral gene such as HIV: claims 1-4) expression of a cytokine protein(claim 5) in a eukaryotic cell. Meichle teaches the use of Protein Kinase Inhibitor H8 (among others) to reduce NF-κβ-mediated gene transcription by reducing NF-κβ activity and reducing the binding of NF-κβ to NF-κβ binding sites.

It is noteworthy that the USPTO states that claim 1's sole method step is functional, i.e., reducing NF-κβ activity and, therefore, the claims would encompass any in vitro or in vivo, natural (indirect) or man-made (direct) means of reducing NF-κβ activity. The Examiner contends that most of the method steps recited in the patent are purely functional with the exception of claim 7 and dependent claims 81, 83 and 85-87 which require "modifying NF-κβ activity" (which are partially functional) and claim 203 which requires "introducing a nucleic acid decoy molecule into the cell" which requires an active step.

The problem with biochemical pathway patents for generic treatments is that they represent methods of treating disease by modulating a particular pathway in the body without claiming a specific drug or class of drugs that may effect the modulation. While this may provide broad (over)reaching claims, the reverse applies, too. That is, all the Examiner needs to show is that someone, somewhere modulated the pathway - whether they knew it or not.

Prior to the '516 patent, there were agents that existed that are now known to act by inhibiting NF-κβ activity, e.g., ibuprofen, which has been around since 1969 even if it's mode of action wasn't known until 1998. The mode of action was inherent even if not appreciated. Heck, even vitamin E inhibits NF-κβ activity. There's just going to be a lot of prior art out there.

Of concern to Amgen, of course, is that claim 69 recites "a method for diminishing induced NF-κβ-mediated intracellular signaling comprising reducing NF-κβ activity in cells such that NF-κβ-mediated intracellular signaling is diminished, wherein reducing NF-κβ activity comprises reducing binding of NF-κβ to NF-κβ recognition sites on genes which are transcriptionally regulated by NF-κβ." Ariad claims that Evista acts by inhibiting NF-κβ binding to its binding site.

As we've said earlier, this is far for over. Given the time for responses and extensions, it could be a year or two before this is settled (if then). We'll keep you posted as to a response by Amgen.

What a perfect wrap-up for the week before a long holiday weekend. The United States Patent and Trademark Office (USPTO) has released for public comment a draft five-year strategic plan designed to "foster American innovation and competitiveness at home and around the globe." We're fostering everyone else's innovation now? The draft plan identifies quality and timeliness of the patent and trademark review processes through 2012.

The proposals included in this draft strategic plan include:

First, there must be a common understanding between the USPTO and its stakeholders of what defines quality. That definition must recognize the inherent realities of limited time and money, and must then be translated into concrete programs.

Defining an acceptable time frame from filing to final decision also is important.

Additionally, hiring, training and retaining highly skilled patent examiners, abolishing the one-size fits all examination system, focusing examination on the claimed invention, and leveraging state-of-the-art information technology are other important components to ensuring high quality and timely reviews of patent applications.

Included among the draft proposed initiatives designed to ensure effective and efficient review of patent applications are:

• hiring at least 1,000 patent examiners annually for the next five years;
• consideration of establishing regional offices;
• creating partnerships with universities;
• offering retention bonuses and new monetary awards to patent examiners for meeting goals; and
• maximizing the potential of state-of-the-art electronic tools.

Jon Dudas says "The U.S. intellectual property system is critical to American innovation and competitiveness." Apparently, that's why he's hell-bent on making it impossible to get a patent by introducing ideas like the proposed rules to limit the number of continuing, CIP and RCE applications that can be filed by patent applicants. We only wish they could put such efforts into the "Tanorexia Threat Level" panic.

A copy of the USPTO's draft proposed five-year strategic plan can be found here.

After the Medicines Company, based in Massachusetts, missed a non-extendable deadline for filing for a patent term extension by a single day, Rep William Jenkins [TN] introduced H.R. 5120 in the U.S. House of Representatives to amend 35 U.S.C. 156, the statute governing patent term extensions based on regulatory review delay.

Known as the "Dog Ate My Homework Act", the Act would allow the Director of the United States Patent and Trademark Office (USPTO) to accept an application for an extension of the term of a patent which claims a product, a method of using a product, or a method of manufacturing a product if: (1) such application is filed no more than 5 days late; and (2) the applicant files a petition showing that the delay in filing the application was unintentional. The Act also deems such petition to be denied if no determination has been made on the petition within 30 days of filing.

The Act applies to any application for patent term extension which: (1) is pending on the date of enactment; (2) is the subject of a request for reconsideration of a denial of a patent term extension; or (3) has been denied a patent term extension in a case in which the period for seeking reconsideration of such denial has not yet expired. Currently, a patent applicant has to file no later than 60 days after the Food and Drug Administration approves the drug for commercial use and sale. There are no exceptions to that window, so patent officials rejected the application.

The Medicines Co. filed for a patent extension on its drug Angiomax (an anticoagulant that prevents clot formation during angioplasty) on Feb. 14, 2001, one day later than the application deadline. The company wants its patent to be extended 1,773 days, giving it exclusive rights to the drug until Dec. 15, 2014. This is a high-stakes game of chance as the Medicines Co. expects Angiomax to generate more than $500 million in sales in the United States by 2010. To show how much it cares, the company spent $440,000 on lobbying last year - all in the name of progress.

While some would say that "deadlines are deadlines" and it's just tough luck for those who miss them, it doesn't make sense to deny any kind of equity. It also doesn't make sense to extend the deadline for 5 days. Where did that number come from? I think the standard should be the same reviving an application that becomes abandoned because of failure to timely pay the issue fee or respond to a Patent Office deadline, that is, when the abandonment was unavoidable and unintentional. Both require a fee where the fee for unintentional is a huge fee compared with unavoidable since fault is admitted on the part of the applicant.

For both unavoidable and unintentional revival there is no time limit, but the applicant must state that the entire delay between abandonment and the filing of the revival petition was unavoidable or unintentional. For equity's sake, a terminal disclaimer would then be filed equal to the time that the application was abandoned. Why should extensions receive different treatment than other types of "oops"?

What a Diff'rence a Day Makes!

In his official capacity as Director of the USPTO, Jon Dudas, along with Yeda Research and Development Co., was recently named as a defendant in an action filed by Enzo Therapeutics. The complaint, filed July 3 in the U.S. District Court for the Eastern District of Virginia, details Enzo's unsuccessful efforts to establish co-pendency of two US applications via filing a Petition to Revive.

The suit stems from an interference between junior party Sehgal and senior party Revel (real parties-in-interest Enzo Therapeutics and Yeda Research and Development, respectively). Because of an inadvertent failure to file a Three-month Petition for Extension of Time, Sehgal’s U.S. application 06/255,215 (the '215 application)-- to which Enzo intended to claim priority-- was deemed abandoned. The continuation application US 06/634,998 (the '998 application) was therefore found not co-pending with the earlier application. The Board denied Enzo's Petition to Revive the '215 application, and priority of invention was awarded to Revel.

According to the complaint, Enzo asserts that the Board of Patent Appeals and Interferences violated the PTO's regulations, abusing their discretion by deciding the Petition to Revive, and that the Director had unreasonably withheld or delayed action on both plaintiff's 183 Petition (the accompanying petition to waive the requirement for a terminal disclaimer) and the Petition to Revive.

In its Complaint, Enzo asserts that the PTO was required to give deference to representations made in the Petition to Revive concerning a delay or inquire further into the matter:

In accordance with M.P.E.P. § 711.03(c)II.C, the PTO "relies upon the applicant's duty of candor and good faith and accepts that statement that 'the entire delay in filing the required reply from the due date for the reply until the filing of a grantable petition pursuant to 37 C.F.R. § 1.137(b) was unintentional' without requiring further information in the vast majority of petitions under 37 C.F.R. § 1.137(b)."

The PTO "is almost always satisfied as to whether 'the entire delay... was unintentional' on the basis of statement(s) by the applicant or representative explaining the cause of the delay accompanied at most by copies of correspondence relevant to the period of delay." M.P.E.P. §711.03(c)II.C.

Even if an applicant's statement is not accepted, then the PTO "... reserves the authority to require further information concerning the cause of abandonment and the delay in filing a petition to revive ..." M.P.E.P. § 711.03(c)II.C.

The PTO did not request further information concerning the cause of abandonment of the '215 application or delay in filing the Petition to Revive.

In the absence of a request for further information, the statement in the signed Petition to Revive that "the entirely delay in filing the required reply from the due date for the reply until the filing of a grantable petition pursuant to this paragraph was unintentional" should be deemed as accepted by the PTO.

Paragraphs 33-37 of the Complaint.

Enzo asserts that the Board violated PTO regulations and exceeded its authority by denying the Petition to Revive without forwarding to the Office of the Deputy Commissioner for Patent Examination Policy. Enzo further charges the Board with abuse of discretion for failing to accord proper weight to statements made in the Petition to Revive, relying instead on an unrecorded conference call between the Attorney for Sehgal and a judge in a "he-said"-"she-said" fashion.

The facts as set forth by Enzo suggest that intentional abandonment would be absurd. Enzo, in its complaint, points to the file history of the '215 patent and its progeny to show subsequent filings requesting a continuation application accompanied by copies of the '215 application; amendments to claim priority to the '215 parent application; acceptance by the PTO of Sehgal's request for a continuation application as evidenced by a notation on the front cover of the continuation application and the PTO Filing Receipt; and an express request by Sehgal for the abandonment of the '215 parent application when the continuation was filed.

In Enzo's words:

A registered patent practitioner would never "intentionally" cause a parent application to become prematurely abandoned and then, at the same time, file a "continuation" application (including an express request to abandon the parent on that date); the two acts are entirely inconsistent and thus the non-filing of the petition for extension of time resulting in premature abandonment could only have resulted from a clearly unintentional error. (Paragraph 57 of the Complaint.)

Enzo has asked the court to reverse the decision of the Board, expunging from the record all of the Board's findings, and remand the case to the Board for further administrative proceedings. Enzo has further requested that the Court compel the Director to decide the 183 Petition and forward the Petition to Revive to the Office of the Deputy Commissioner for Patent Examination Policy to promptly decide the Petition.

Download the Complaint Part 1.

Download the Complaint Part 2

Thanks to Tom Scott of Hunton & Williams LLP for a copy of the complaint.

As part of its ongoing efforts to reduce its workload instead of expanding to meet increased demand, the U.S. Patent and Trademark Office (USPTO) announced a new proposal for the patent application review process. Under the new proposal, patent applicants would be required to provide the USPTO with the most relevant information related to their inventions in the early stages of the review process.

Apparently, the current obligation to inform patent examiners of all information known to be material to patentability of the invention claimed by the applicant is just not enough. Now, they don't want to have to read anything. With the proposed changes, patent examiners would not have to review documents that do not directly relate to the claimed invention, or that duplicate other information already submitted.

In a bad case of blaming the victim, the USPTO says it "has observed that applicants sometimes provide information in a way that hinders rather than helps timely, accurate examination. For example, some applicants send a very large number of documents to the examiner, without identifying why they have been submitted, thus tending to obscure the most relevant information. Additionally, some applicants send very long documents without pointing out what part of the document makes it relevant to the claimed invention." The USPTO claims that the proposed rule change is designed "to discourage submission of information that is unimportant or does not add something new for the examiner to consider."

Gee, I wonder why an applicant would want to send along references that may not directly relate to the invention? I'm sure this has nothing to do with the fact the applicant risks losing the entire patent in litigation under some claim of "inequitable conduct" (the standard greeting that any two patent lawyers use upon meeting) if they happen to forego sending some tangentially related reference.

In summary from the USPTO:

To encourage submission of relevant information to the patent examiner promptly and in a way that brings the most important information to the attention of the examiner, the USPTO is proposing to eliminate all fees associated with submitting an IDS. Under the proposal, applicants in most cases would be permitted to send up to twenty documents without additional explanation, if these documents are provided to the USPTO before the examiner sends a first communication to the applicant.

Were an applicant to submit more than twenty documents, or wait until after the patent examiner's first communication has been sent, the applicant would face increasing requirements to provide more detailed information about the documents and how they relate to the claimed invention. Applicants could be required to point out what part of the document makes it important, to identify specific claims to which a document applies, to clarify how a document adds new information not already considered by the examiner, or explain why the claims are patentable in light of the information provided.

So, under the proposal, applicants would still be able to send in as many documents as they choose. However, they will suffer the dire consequences of piling up mounds of prosecution history estoppel.

What's next, applicants will have to draft their own Office Actions and rejections and then be held accountable if they make a difficult judgment call or "mischaracterize" an issue?

See the whole enchilada here.

The San Francisco Business Times ran an article reiterating what patent practitioners already know. That is, the increasing backlog at the U.S. Patent & Trademark Office is bad, it's getting worse and the new set of proposals meant to reduce the waiting time will not provide relief.

The backlogs are an increasingly serious issue for biotechs. It can take patent examiners up to 15 months to begin reviewing an organic chemistry patent application. It can take more than three years to get a drug application to a patent examiner. Once a review has begun, the USPTO can take several more years to grant a patent.

As we've discussed, the new rules under consideration would allow just one follow-on to a pending application. A subsequent application would have to include an explanation as why it was not submitted previously. A second, related proposal would limit an application to 10 claims, which are statements describing the heart of the invention. The USPTO is currently reviewing comment on the proposed rules and will issue final regulations in the fall or winter.

Admittedly, almost one-third of new applications in 2004 were for follow-on applications but that's not necessarily a bad thing. Part of the reason for continuations is to allow an applicant the opportunity to carve our the proper claim scope. That is, coverage that would not be too overbroad or too narrow but just right.

Many industries besides biotech rely on obtaining adequate patent protection in a timely fashion. However, biotech companies are particularly affected by both the backlog and the proposed rule changes. And, perhaps no other industry is as dependent upon patents as is the biotechnology industry. A biotechnology company can spend hundreds of millions of dollars over more than a decade before seeing any revenue. The long development time and intensive capital needs make the early stages of development critical in terms of patent protection in order to entice investors to get involved in what is already an incredibly risky venture. Thus, a flexible patenting system that allows companies to protect the full scope of their inventions through the filing of continuations is critical.

The Biotech Industry Organization believes that the USPTO should consider a "deferred-accelerated" system since not all applications require immediate examination. Under such a deferred examination system, an applicant may file an application with little cost and then decide whether to request examination at a later date by paying an examination fee. The marketplace would then dictate when -- or if -- the application would get examined. BIO also recommended changes in the PTO examiner production system, increased examiner education, and improved cooperation with other patent offices.

The bottom line is that the proposed rules will NOT achieve the stated goals of reducing patent application pendency nor will it expedite public notice as the USPTO claims. The practice would, instead, increase the cost of obtaining patent protection as well as increase uncertainty as to whether or not proper claim scope may be obtained.

Read BIO’s comments here.

In Falker-Gunter Falkner et al. v. Inglis et al. (Fed. Cir. 2006, 05-1324), on appeal from the USPTO Board of Patent Appeals and Interferences, the U.S. Court of Appeals for the Federal Circuit set out some guidelines on the adequacy of written description and enablement in biotech cases. The Federal Circuit held that:

(1) examples are not necessary to support the adequacy of a written description;

There was an interference between U.S. Patent No. 5,770,212 (“the Falkner ‘212 patent) and Inglis et al., U.S. Application Serial No. 08/459,040 (“the Inglis ‘040 application”) and the Board held that Falkner could not antedate Inglis’ priority date.

Claim 29 of the Inglis ‘040 application reads:

A vaccine comprising a pharmaceutically acceptable excipient and an effective immunizing amount of a mutant virus, wherein said mutant virus is a mutant poxvirus and has a genome which has an inactivating mutation in a viral gene, said viral gene being essential for the production of infectious new virus particles, wherein said mutant virus is able to cause production of infectious new virus particles in a complementing host cell gene expressing a gene which complements said essential viral gene, but is unable to cause production of infectious new virus particles when said mutant virus infects a host cell other than a complementing host cell; for prophylactic or therapeutic use in generating an immune response in a subject.

Claim 1 of the Falkner ‘212 patent reads:

A vaccine comprising (a) a defective poxvirus that lacks a function imparted by an essential region of its parental poxvirus, wherein (i) said defective poxvirus comprises a DNA polynucleotide encoding an antigen and said DNA polynucleotide is under transcriptional control of a promoter, and (ii) the function can be complemented by a complementing source; and (b) a pharmaceutically acceptable carrier.

The inventors discovered a way of making vaccines safer by deleting or inactivating an essential, rather than an inessential, gene from the viral vector’s genome, while at the same time solving the production problem by growing the vaccines in cells that were complementarily modified to produce the absent essential viral gene product “on behalf of” the vector virus. Thus, the modified vector virus could be readily grown in these complementarily-modified cells, but not in other cells, such as those of an inoculee.

Falkner argued that the claims in Inglis’s ‘040 application were unpatentable because they failed to meet the written description requirement of 35 U.S.C. § 112 because (1) the specification did not identify any essential genes in poxvirus or describe the inactivation of such genes, (2) vaccines based on vaccinia (a type of poxvirus) had not yet been produced, and (3) the bulk of the Inglis specification was directed not to poxviruses but to herpesviruses. Falkner also argued that Inglis did not sufficiently describe and enable the claims in question and that without the benefit of these applications, Inglis would be unable to establish constructive reduction to practice earlier than Falkner.

The Federal Circuit laid out the requirements for enablement and written description as follows:

1. Examples Are Not Required

A claim will not be invalidated on section 112 grounds simply because the embodiments of the specification do not contain examples explicitly covering the full scope of the claim language. That is because the patent specification is written for a person of skill in the art, and such a person comes to the patent with the knowledge of what has come before. Placed in that context, it is unnecessary to spell out every detail of the invention in the specification; only enough must be included to convince a person of skill in the art that the inventor possessed the invention and to enable such a person to make and use the invention without undue experimentation.

2. Actual Reduction to Practice Is Not Required

As we explained in Capon v. Eshhar, “[t]he ‘written description’ requirement implements the principle that a patent must describe the technology that is sought to be patented; the requirement serves both to satisfy the inventor’s obligation to disclose the technologic knowledge upon which the patent is based, and to demonstrate that the patentee was in possession of the invention that is claimed.” 418 F.3d 1349, 1357 (Fed. Cir. 2005). The Board was correct, however, not to view as dispositive that Inglis had not actually produced a poxvirus vaccine, because an actual reduction to practice is not required for written description. See Univ. of Rochester v. G.D. Searle & Co., 358 F.3d 916, 926 (Fed. Cir. 2004) (“We of course do not mean to suggest that the written description requirement can be satisfied only by providing a description of an actual reduction to practice. Constructive reduction to practice is an established method of disclosure . . . .”). Rochester, moreover, is consistent with Supreme Court precedent. In the context of interpreting 35 U.S.C. § 102(b), the Court held that “[t]he word ‘invention’ must refer to a concept that is complete, rather than merely one that is ‘substantially complete.’” Pfaff v. Wells Elecs., 525 U.S. 55, 66 (1998). It then proceeded to make clear that although “reduction to practice ordinarily provides the best evidence that an invention is complete. . . . it does not follow that proof of reduction to practice is necessary in every case.” Id. (emphasis added). Thus, to the extent that written description requires a showing of “possession of the invention,” Capon, 418 F.3d at 1357 (emphasis added), Pfaff makes clear that an invention can be “complete” even where an actual reduction to practice is absent. The logical predicate of “possession” is, of course, “completeness.”

3. Recitation of Known Structure Is Not Required

The descriptive text needed to meet these requirements varies with the nature and scope of the invention at issue, and with the scientific and technologic knowledge already in existence. The law must be applied to each invention that enters the patent process, for each patented advance is novel in relation to the state of the science. Since the law is applied to each invention in view of the state of relevant knowledge, its application will vary with differences in the state of knowledge in the field and differences in the predictability of the science.

Indeed, a requirement that patentees recite known DNA structures, if one existed, would serve no goal of the written description requirement. It would neither enforce the quid pro quo between the patentee and the public by forcing the disclosure of new information, nor would it be necessary to demonstrate to a person of ordinary skill in the art that the patentee was in possession of the claimed invention. As we stated in Capon, “[t]he ‘written description’ requirement states that the patentee must describe the invention; it does not state that every invention must be described in the same way. As each field evolves, the balance also evolves between what is known and what is added by each inventive contribution.” Id. at 1358. Indeed, the forced recitation of known sequences in patent disclosures would only add unnecessary bulk to the specification. Accordingly we hold that where, as in this case, accessible literature sources clearly provided, as of the relevant date, genes and their nucleotide sequences (here “essential genes”), satisfaction of the written description requirement does not require either the recitation or incorporation by reference14 (where permitted) of such genes and sequences.

A lone blogger may have succeeded in getting Amazon's 1-Click Patent cut short. The '411 patent, assigned to Amazon, is known as the 1-Click Patent for its claim on ordering items on the web by "clicking" just once. Based on material submitted by New Zealander and Lord of the Rings choreographer Peter Calveley, the USPTO ordered a reexamination of Amazon's 1-Click Patent.

Specifically, the 1-Click patent claims:

Claim 11. A method for ordering an item using a client system, the method comprising: displaying information identifying the item and displaying an indication of a single action that is to be performed to order the identified item; and in response to only the indicated single action being performed, sending to a server system a request to order the identified item whereby the item is ordered independently of a shopping cart model and the order is fulfilled to complete a purchase of the item.

Citing a 'substantial new question of patentability' to claims 11, 14-17, 21 and 22 of U.S. Pat. No. 5,960,411, the Examiner now contends that U.S. Pat. No. 5,729,594, along with other non-patent references, suggest the use of a single action ordering system.

The '594 patent and all of the cited publications relate to one form or another of a Digicash system, also called E-cash, Cybercash, Cybercoin, etc. In such Digicash systems, a user has access to an amount of "electronic cash" available to purchase items electronically via phone lines or via the Internet. The purchaser may click on an item to buy using a single action. An amount of electronic cash is then subtracted from the user's account and the item may be sent to the user, for example via an electronic connection in the case where the item is software or some other downloadable product. Therefore, the '594 patent and exhibits suggest the use of a single action ordering system. The Examiner notes that none of these Digicash or electronic cash systems contemplates the use of a shopping cart model. But, the Examiner points out tat the shopping cart model is not a positively recited element in claim 11.

In an Ex Partereexamination, either a challenger or patent holder may seek reexamination of a patent based on patents or printed publications. If the PTO orders reexamination, the patent holder is given the opportunity to file a statement concerning the new question of patentability, including amendments or new claims they want to propose (provided, however, that the claims may not be broadened).

If the patent holder files such a statement, the statement must be served on the person requesting reexamination, and the requester is given two months to file a reply to the patent owner's statement. From that point on, the claims are examined without participation by the requester. Following the Ex Partereexamination, the PTO issues a certificate canceling any claim determined to be unpatentable, confirming any claim determined to be patentable and incorporating in the patent any new claim or amended claim determined to be patentable.

Whether to pursue patent reexamination, either Inter Partes or Ex Parte, involves the balancing of significant considerations. The major advantage to a patent challenger of the Inter Partes procedure over the Ex Parte procedure is that in the Inter Partes procedure the challenger has the right to participate throughout the process. Also, the challenger can submit arguments supporting the Examiner when the Examiner takes a position unfavorable to the patentee, and the challenger can submit declarations by technical experts concerning the patent and the prior art.

The challenger however, must consider certain disadvantages to the reexamination process. One important consideration is that the process gives the patentee the opportunity to amend its claims and add new claims. While the patentee may not broaden the scope of its claims, the patentee may amend the claims to (1) make them patentable in view of the prior art, including the new prior art cited by the challenger, and (2) make them more clearly cover the challenger's allegedly infringing product. Another major disadvantage to the challenger, in the Inter Partes process, is that the challenger is estopped from challenging the patent in court, except in very limited circumstances. Thus, the Inter Partes challenger must be prepared to do its best job before the PTO because it is unlikely to get another opportunity if it fails to achieve the results it desires there.

Whatever the result of the 1-Click patent, this case is a good example of how it only takes one determined individual to bring down the mightiest patent.

Jon Dudas, Commissioner of the U.S. Patent and Trademark Office, urged Congress to move ahead with legislation to improve the patent system. He told a U.S. House of Representatives Judiciary subcommittee that it should adopt provisions that would prevent questionable patents from being approved and give companies more leeway to challenge patents after they're issued.

Dudas singled out two improvements he said the patent office supports that are being considered by the House Judiciary subcommittee on intellectual property:

• One would give third party companies more leeway to challenge a patent that has been approved.
• The other would allow third parties to go to government examiners while they are still considering whether to grant a patent and point out similar existing technology to argue against granting a patent.

Both proposals "are widely supported throughout the intellectual property community and would directly improve patent quality," Dudas said. But I'm sure someone will blame patent attorneys for everything.

Now, Matt Buchanan of Promote the Progress reports that a new patent reform bill, the Patents Depend on Quality Act of 2006 ("the PDQ Act"), was circulated yesterday by Representative Berman. Steve Nipper at the Invent Blog has a brief review and a .pdf of the bill.

The bill includes the opportunity for third party submissions during prosecution along with Post-Grant Opposition Procedures for opposing a patent. The opposition file would be open to the public. The bill also includes changes to inter partes reexamination and the permitted grounds for willful infringement damages. The bill includes the following limitations:

SEC. 8. INJUNCTION.

Section 283 of title 35, United States Code, is amended by adding at the end the following: "In determining equity, the court shall consider the fairness of the remedy in light of all the facts and the relevant interest of the parties associated with the invention. Unless an injunction is entered pursuant to a nonappealable judgment of infringement, a court shall stay the injunction pending an appeal upon an affirmative showing that the stay would not result in irreparable harm to the owner of the patent and that the balance of hardships from the stay does not favor the owner of the patent."

In the Senate, Judiciary Committee Chairman Orrin Hatch, a Republican from Utah, is also preparing a patent reform bill.

Meanwhile, the U.S. Patent and Trademark Office started operating its "hoteling" program that allows patent examiners to telecommute from home four days a week and use a shared office space on the fifth day. About 500 of those employees each year are scheduled to be assigned to the hoteling program. The programs are called hoteling because employees must reserve a work space in the way a hotel guest makes a room reservation. With hoteling, many employees share a work space. The Patent and Trademark Office plans to add to its hoteling program as long as the quality of work is not compromised. Among the 4,300 patent examiners, 78 are hoteling as of this week. The agency is adding another 40 every two weeks.

The Patent and Trademark Office is one of the government's fastest-growing agencies. It plans to add 1,000 examiners per year to its staff of 7,400 employees for the next four years to help clear up a backlog of patent applications. I'm OK with Examiners working in their bunny slippers if it would mean better examination (and an easing of the restriction craziness).

The USPTO is proposing changes to the rules of practice relating to ex parte and inter partes reexamination. The USPTO is proposing to provide for a patent owner reply to a request for reexamination prior to the Examiner's decision on the request. Currently, most requests are allowed and the new procedures may help cut down the number of reexams by giving the patent holder a chance to argue that no new substantial question of patentability exists.

The Office is also proposing to prohibit supplemental patent owner responses to an Office Action in an inter partes reexamination without a showing of sufficient cause.

No public hearings will be held. Comments on the proposed change are due by May 30, 2006 and can be sent to the USPTO at: AB77.comments@uspto.gov or fax to: 571.273.7710.

See the Proposed Revisions here.

The biggest invention news this week has not been American Inventor but an update to the way patent applications are filed. While we've been participating in the beta testing program for months now, the United States Patent and Trademark Office's (USPTO) has officially released the new electronic filing system (EFS-Web) that will allow applicants to file over the Internet.

The new system offers a number of advantages including patent applicants can file applications and related documents using the Internet without the need for specialized software. Users of PASAT (or attempted users, as the case may be) will certainly cheer over this. And no, not that one. In the new system, applicants submit documents by simply creating applications and related parts as normal, converting these to PDF files and then uploading the PDF files directly over the web. If you don't have Adobe Acrobat, you can use other PDF creators, e.g., CutePDF (we just love it for the name). Patent fees can also be paid over the Internet using a credit card.

EFS-Web submissions are automatically processed through the USPTO so patent filers receive rapid access to their applications through the Patent Application Information Retrieval (PAIR) system. In my experience with using the system, I found that I can view submissions and confirm that documents have been securely and accurately received almost instantaneously. Most importantly, you receive an automatic electronic filing receipt immediately upon uploading - no more return postcards to get lost!

The PTO is planning to add additional functionalities over the coming months but we already think this is a giant step for Mankind.

For more information on EFS-Web, see here.

Earlier, I asked if anyone could provide insight into the U.S. Patent Office's proposed rules to limit the number of continuing, CIP and RCE applications that can be filed by patent applicants. Mr. Roy Marsh, a European Patent Attorney in Munich with Hoffmann Eitle, writes:

I surmise that the USPTO is envious of EPO success in managing its pendency periods, and so thinks it a good idea to borrow the EPO's tools, to the extent that this is feasible.

I detect in USA an adversarial relationship between Exrs and Applicants that is not usual in Europe, and I venture to suggest it's because of your presumption of validity. Here in Europe, nobody defers after grant to the work of Patent Office Examiners before grant, and validity after grant hangs on the preponderance of evidence. Because of that, examination on the merits is a chance to fashion, with help from the Examiner, a patent that has a sporting chance of withstanding heavier, competitor-inspired attacks on validity after issue.

This relationship might explain why European patent attorneys start with claim sets in which the dependent claims are genuine positions of enhanced patentability, yet have no expectation of being unfairly restricted to those claims by the 3-member Examining Division.

This might also explain why only 1% of EPO Exrs have resigned within their first year, but 30% in the USPTO. As an Examiner, you get more respect in the EPO.

Looking at a typical patent family list, one is usually struck by the skewed distribution, geographically. One finds typically 10 to 20 USPTO publications but only one or two publications for each other jurisdiction in the ROW. Something special about the USA is causing these distributions. Even if the value of any single non-US patent were as high as that of a US patent, I cannot imagine us in Europe getting to the numbers of patent publications I regularly see as the US component of a patent family.

Any Patent Office has to serve the public, not just its Applicant community, with the public policy objective of nurturing the tender young shoots of innovation. Helping youngsters clear their way through the patent thickets of the established market leaders is going to foster innovation, isn't it?

Of course, USPTO Rules on their own aren't going to change the numbers on the patent families. Does anybody want less US items on a patent family list? If so, then they will need to convince the US of the need for deeper changes, in the US patent system.

Let us know your comments on the Proposed Rules.

News of patent anarchy are ringing throughout the land citing the troubles with the U.S. Patent and Trademark Office (USPTO) both for its long processing times and cries that it issues too many "unworthy" patents, which fall into the hands of the evil Patent Trolls who hold up legitimate businesses for ransom.

While the troll of lore lived under a bridge and extorted money from travellers, so-called "patent trolls" send cease-and-desist letters warning companies that their products are infringing on patents, and asking for payment. (Ironically, Peter Detkin, former assistant general counsel at Intel Corp. credited with coining this term now works for Intellectual Ventures LLC, a company that has been spending millions to buy up patents.)

It is clear that the USPTO believes that applicants should shoulder some blame for the its own troubles, which include a backlog of one million pending patents and record pendency times. While this seems a little like Disneyland hiring one person to work the front gate and then blaming the visitors for the long line to get in, the USPTO is certainly not the only one trumpeting patent woes.

BusinessWeek took up the issue recently in its article The Patent Epidemic claiming overpatenting is wasting companies' money and slowing the development of new products. The article notes that in a recent Supreme Court case, two dozen intellectual-property law professors have filed amicus briefs claiming that massive overpatenting "creates an unnecessary drag on innovation," forcing companies to redesign their products, pony up license fees for technology that should be free, and even deter some research altogether. Sounds good but it would seem that one person’s “massive overpatenting” is another’s “claim to rightful ownership.”

BW also points to "the evisceration of the obviousness test by the Federal Circuit Court of Appeals" as one of the primary causes of evil patenting. That, it is claimed, has led to a flood of low-quality patents being granted, and made it difficult to challenge a patent in court on the ground of obviousness.

In the case KSR International Co v Teleflex Inc. (04-1350), the Court will hear whether the Federal Circuit erred in holding that a claimed invention cannot be held "obvious", and thus unpatentable under 35 USC § 103(a), in the absence of some proven "teaching, suggestion, or motivation that would have led a person of ordinary skill in the art to combine the relevant prior art teachings in the manner claimed."

Defenders of the rule say use of hindsight can be prevented only by requiring documented evidence that an idea was easily available. Others note that new technology emerges all the time that isn't found in published journal. Either way, the interest in patents stems not from ineffective patent rules but heightened financial stakes as we move into a knowledge economy. In a land where ideas are king, great battles will be fought to take the crown.

The USPTO has proposed rules to limit the number of continuing, CIP and RCE applications that can be filed by patent applicants. See here for the notice.

Why have continuations become the current whipping boy for the Patent Office? The Notices states that "current practice allows an applicant to generate an unlimited string of continued examination filings" and that "the exchange between examiners and applicants becomes less beneficial and suffers from diminishing returns as each of the second and subsequent continuing applications or requests for continued examination in a series is filed."

The Notice continually mentions the "burdens imposed" on the USPTO but never mentions all the fees it collects. The USPTO claims that this would "ease the burden of examining multiple applications that have the same effective filing date, overlapping disclosure, a common inventor, and common assignee by requiring that all patentably indistinct claims in such applications be submitted in a single application." Really? Wouldn't each related application be easier to examine? What about the fact that the patentee is PAYING for the examination of these multiple applications?

The USPTO believes that Applicants should not rely on an unlimited number of continued examination filings to "correct deficiencies in the claims and disclosure that applicant or applicant’s representative have not adequately reviewed." What about the need to "correct deficiencies" in the examination and response by the Examiner because the specification has not been adequately reviewed and understood?

Clearly, this has not been thought through very well. While the Notice claims that the current unrestricted continued examination practice "does not provide adequate incentives to assure that the exchanges between an applicant and the examiner during the examination process are efficient," this is precisely what the earlier change in term to 20 years from filing accomplishes. The loss of patent term combined with the fees imposed with continuing practice provides more than enough incentive for expedited prosecution. This would seem to be a solution without a problem.

Proposed § 1.78(a)(3) defines a ‘‘divisional application’’ as a continuing application as defined in § 1.78(a)(1) that discloses and claims only an invention or inventions that were disclosed and claimed in the prior-filed application. This would make it impossible to bring in claims not presented as filed earlier.

Proposed § 1.78(f)(1) provides that if a nonprovisional application has a filing date that is the same as or within two months of the filing date of one or more other pending nonprovisional applications or patents, taking into account any filing date for which a benefit is sought under title 35, United States Code, names at least one inventor in common with the one or more other pending nonprovisional applications or patents, and is owned by the same person, or subject to an obligation of assignment to the same person, as the one or more other pending nonprovisional applications or patents, the applicant must identify each such other application or patent by application number (i.e., series code and serial number) and patent number (if applicable).

Note that proposed Rule § 1.78(f)(2) provides that for applications that fall under set proposed § 1.78(f)(1) above, there will be a rebuttable presumption that the nonprovisional application contains at least one claim that is not patentably distinct from at least one of the claims in the one or more other pending or patented nonprovisional applications. In that case, the applicant in the nonprovisional application must either: (1) rebut this presumption by explaining to the satisfaction of the Director how the application contains only claims that are patentably distinct from the claims in each of such other pending applications or patents; or (2) submit a terminal disclaimer in accordance with § 1.321(c). The USPTO would also have the authority to require elimination of the patentably indistinct claims from the second application under proposed Rule 1.78(f)(3).

The USPTO has also proposed rules to limit the examination of each application to 10 designated claims or less. See here for the notice.

Although this would put U.S. practice more in line with the EPO, these proposed rules do not appear to be favorable to patent applicants or even consistent with other recent USPTO fee changes.

The USPTO has already raised the fees that it charges for each independent claim in excess of three in each application to encourage applicants to file no more than three independent claims in each application (with the understanding that additional independent claims required to cover a complex or multi-faceted invention may be presented in separately filed applications). Under the new rules, applicants would risk having the number of total applications containing the additional independent claims limited by the USPTO if all of the claims are not presented in a single original application.

The patent community is invited to submit their comments directly to the USPTO by May 3, 2006. If you know the impetus behind this proposal, send me a note. I'd love to hear your opinions.

"What To Do About Bad Patents" under Briefly Noted by Profs. Lemley, Lichtman and Sampat (the Profs.) bemoans today's patents, and then asks whether past problems provide a formula for new solutions.

In their equation, opposing values are placed on either side of the equal sign. (If not for our talent of scaling justice, and equating one side to the other, then what use are we lawyers). Balance first an Under-budgeted Examining Corps against a Patent Office that over-budgeting cannot cure. Equate then, as a negative and positive, the Statutory Presumption of Validity with a presumption that the statutory examination of 21st Century inventions results in invalid and useless patents. Counterweight next that, most patents are worthless to the economy, but that a lot of unworthy inventions can kill commerce in a new economy.

What the Profs. describe, however, does not balance the equation in favor of either set of factors, nor lead to the conclusions that they promote. It does makes sense to say that the patent system, including both applicants' counsel and the examiners, needs to be driven in new directions. While that will not be free of costs, it is correct to say that piling money will not of itself improve the PTO (a new computers won't make you smarter/better). Next, useless patents impose no novel or unique threat to the system or the economy, and so, keep considering them useless. If I can patent an invention comprising drinking straws in combination with nostrils, then, yawn.

Apart from that, I see things differently than the Profs. The presumption of validity is statutory, so give it some reverence. The presumption should be immutable, with its exceptions, or it just should be eliminated (to paraphrase the Profs., it's either "gold" or "wooden"). To have a sliding scale presumption eliminates it, or, that sliding feature will work as well as the $9.95 slider-ring computer for your wristwatch. It's moveable, but you never sure how far it goes. Next, the folks in our examining corps are smart and well supervised, so why cast them as willing/able only to churn out piece-work quality on a budget.

They deserve a lot of love too, what with having to deal with pricey cagey patent lawyers all day. Imagine that you are a young engineer, put in the cross-hairs of some huge firm of patent attorneys, arguing over whether some lame reference they cited, when combined with what you found, renders some dependent claim obvious - and do it 9 times every day with 55 minutes for lunch. Then, having granted allowance to those counsel and clients, they go off to their club with IP in the title, where they complain about the sorry state of the examining corps. But, more importantly, whether the Patent Office has been persuaded, in the past, to grant patents on the building blocks of some web browser, concerns the past and problems that may suggests no future plan. It can be too late to worry about some things in the past. Those patents were granted, are presumed valid, and now, only a court of law might "identify" those as "important" in terms of their validity and scope.

Overall, I do not find the causes or afflictions that the Profs. list, to be causative of future concerns or weighty measures of any solution. Those factors are contradistinct in the article. Money won't solve "the problem," problems put an "implicit tax on consumers," but charging willing applicants more, to "gold plate" their patents, promotes "important" patents, and to do otherwise enables granting non-useless patents on "now-familiar concepts" which may render those "economically significant," thereby "thwarting truly innovative" second-comers. [Apology for, without good grounds, disassembling the Profs. plainer points]. That being said, the Profs. embraced many timely views and reflections on the patent system, but to find a clear new direction for the patent industry may require foresight, not retrospect.

Go then to the Profs. most creditable conclusion of giving the Patent Office the "information" needed to truly examine patents. Try to reverse engineer from that a means to provide the information needed to improve the patent system. Take as a comparable, case differentiation in the courts. If an applicant does not provide three references that he avers are the closest prior art of which he and his agents are aware, then the Patent Office could cause that application to get special review. Also warranting this review are claims around 'system building' blocks. Timely, detailed review would provoke a more in-depth (but not a longer) examination. Files sent for special review would require the applicant to prove that this "important" invention is patentable and is claimed explicitly, and could generally require greater submissions by the applicant. Let the Patent Office 'gold-plate' applications, instead of getting rich applicants to pay extra for a genu-wine "gold-plated" presumption of validity (and other indulgences).

Presently, applicants only have to deny invalidity, and do not have to prove anything, e.g., 'neither reference A nor reference B teaches the combination of straws and nostrils.' Instead of affirmation-by-denial, special review could make applicants show affirmatively that their invention is novel, or that a diligent search found no close references. Also, applicants too may need to state in the file wrapper that the invention has been claimed no more broadly than proper. Applicants could purchase special review too, and may desire that scrutiny, in exchange for outer time limits on that review. This differentiation would work, just like in court, where the simple case gets little supervision and requires basic submissions, and those complex cases with "important" issues are scheduled for additional time and added efforts.

Today's post comes from Guest Barista C. Lee Thomason, a registered patent attorney and IP litigator at Frost Brown Todd's Louisville office.

I received a letter from a reader asking about the current status of the reexamination request on Pfizer's Viagra (sildenafil citrate) patent (U.S. Pat. No. 6,469,012). I always appreciate hearing from readers and don't mind trying to answer questions (when I can) so I reviewed the file history. The proceedings are now merged (consolidated into one) and the actions to date are summarized below.

In October 2002, Pfizer Inc., Pfizer Limited, and Pfizer Ireland Pharmaceuticals filed a patent infringement lawsuit against ICOS, Lilly ICOS, and Lilly in the United States District Court for the District of Delaware. Pfizer contends that the use, offering for sale, selling, manufacture, or importing into the United States of Cialis for the treatment of erectile dysfunction by any of the defendants infringes claim 24 of Pfizer’s U.S. Patent No. 6,469,012, and seeks a declaratory judgment to that effect. Pfizer also seeks a permanent injunction, attorneys’ fees, costs, and expenses.

The USPTO subsequently ordered the reexamination of the Pfizer Patent (Reexam. C.N. 90/007,478). Under the reexamination process, the PTO is required to reconsider the validity of a patent if substantial new questions of patentability are raised by any party including by the PTO itself. The District Court stayed, or suspended, the patent infringement lawsuit, pending the outcome of the reexamination. Subsequently, Lilly ICOS and other parties filed several reexamination requests regarding the Pfizer Patent, which were merged with the USPTO-ordered reexamination. The first office action issued by the PTO rejected claim 24 of the Pfizer Patent. Claim 24 reads:

A method of treating erectile dysfunction in a male human, comprising orally administering to a male human in need of such treatment an effective amount of a selective cGMP PDEv inhibitor, or a pharmaceutically acceptable salt thereof, of a pharmaceutical composition containing either entity.

The Examiner rejected claim 24 on the basis that certain prior art rendered the claimed invention not new, and therefore unpatentable under 35 U.S.C. §102(b), and obvious and unpatentable under the judicially created doctrine of obviousness-type double patenting. This broad claim would cover treatment by any cGMP PDEv inhibitor (read: Cialis) and was rejected over the references Korenmann, 41 J. Am Geriatrics Soc. 363 (1993) and Yin et al., 10(6) Yunnan J. Traditional Chinese Medicine 13 (1989).

On September 15, 2005, the USPTO issued a second office action that rejected Pfizer’s arguments made in response to the first office action, reaffirmed the initial rejection of claim 24, and entered new grounds for rejecting claim 24. The second office action also maintained the obviousness-type double patenting rejection of the other claims. Pfizer’s response to the second office action was due by November 15, 2005. The time for taking any action by a patent owner in an ex parte reexamination proceeding can be extended only for sufficient cause and for a reasonable time specified. Any request for such extension must be filed on or before the day on which action by the patent owner is due, but in no case will the mere filing of a request effect any extension.

Therefore, the time for response has passed but it is possible that Pfizer will file with an extension of time or that the response has just not made it to the file wrapper as yet. If a response has been filed, the USPTO could issue a further action, which may finalize the rejections of claim 24, withdraw the rejections of that claim, or allow an amended claim to be entered. In any event, Pfizer may challenge the result of a final office action within the PTO and subsequently in court.

ICOS and Lilly also have initiated or are defending lawsuits and/or administrative proceedings against Pfizer in other jurisdictions around the world regarding patents corresponding to Pfizer’s U.S. "method of use" patent. The corresponding patent in the UK was found invalid as obvious by the Court of Appeal in Lilly ICOS Ltd v. Pfizer Ltd. (2002) EWCA Civ 1 and Civ 2 and in Australia in Eli Lilly v. Pfizer (2005) FCA 67.

UPDATE: Dr. Vivien Santer, a patent attorney with Griffith Hack in Australia, sent a note pointing out that the case was litigated in Australia, and at first instance claim 10 was held by the Federal Court of Australia to be invalid for lack of inventive step and for lack of fair basis (analogous to lack of support in the specification under US Section 112). Claim 10 is the equivalent of US claim 24, and would have encompassed Cialis. However, the Full Federal Court held on appeal that the invention as claimed was novel and not obvious, but then it upheld the finding of invalidity of claim 10 on the ground of lack of fair basis. A case of winning the battle but losing the war. The appeal decision can be found here.

We'll keep you posted on any further actions on this matter.

See the Nonfinal Office Action here.

While we're on the subject of patent re-exam lately, I received a letter from a plucky individual that has decided to file a request for ex parte reexamination of Amazon’s “One-Click” patent (US Patent 5,960,411), using some prior art that he found.

It turns out that New Zealander Peter Calveley is one of the actors who provided the motions for computer-generated elves and orcs in Two Towers. He also has been laid up of late due to an accident (I can relate). He has now put his free time to use taking on a David and Goliath effort against Amazon.

From his web site, the sequence of events appears to be as follows:

October 04, 2005: Ordered a book from Amazon and it never arrived.

October 09, 2005: Got out of hospital and the book finally arrived (very late).

November 13, 2005: Mailed a request for re-examination for the Amazon "One-Click" patent.

You can view the request in PDF form here and, as you'll see, it is very impressive and quite thorough. Clearly not the average work of a pro se litigant (i.e., not in crayon).

I have to admit, I was quite intrigued by the whole affair given that a Request for Re-Exam is not something average citizens take on in their spare time. After some correspondence, we spoke by telephone briefly -- since I was unwilling to write about his efforts if this was all a scam. I found that Calveley is extremely bright and has his own inventions and understands computer patents and procedures quite well. He has the time and will to do this even if it won't bring him a direct benefit.

The request focuses on one of the broadest claim in the patent, claim 11, along with the dependent claims 14, 15, 16, 17, 21 and 22, relying on two different groups of prior art:

1. United States Patent No. 5,729,594; and

2. A number of references (including pages from the Wayback Machine) referring to DigiCash.

Keep in mind that anyone can file a written request asking the USPTO to reexamine any claim of an issued patent on the basis of prior art consisting of patents or printed publications that the person believes had a bearing on the patentability of any claim of the issued patent. The USPTO reviews this submission and initially determines whether the submitted prior art raises a substantial new question of patentability. If yes, then the patent undergoes an ex parte reexamination. However, beyond the initial request, a third party's involvement in the reexamination ends, and the patent goes through an examination process that is similar to the regular examination process for pending patent applications. Thus, ex parte reexamination has the risk for a third party of bringing to the USPTO's attention a potentially damaging prior art document that the patent owner will survive the challenge and obtain new, stronger claims.

There is also the possibility of using inter partes reexamination provisions which apply to any patents issuing from original applications filed in the United States on or after November 29, 1999. Substantively, the inter partes reexamination procedure tracks the ex parte reexamination procedure, in that the reexamination request must set forth a "substantial new question of patentability" based on a prior art document. Further, as with ex parte reexamination, the patent owner cannot expand the scope of claims but can present narrower claims in view of any prior art cited in the reexamination. Under this reexamination procedure, however, third party requesters can participate in a much more meaningful way. For example, they can respond within 30 days to all papers filed by the patent owner and can comment on positions taken by the examiner in Office Actions.

Given that this is not his profession, Calveley is asking for donations to cover the filing fee with the USPTO. The fee for requesting reexamination is $2,520 and he has so far raised $62.92. Besides donations, he is soliciting comments and criticism.

Make donations and read more about the tale here.

The title to the Public Patent Foundation ("PUBPAT") news release said it all: "PUBPAT Receives Substantial Victory in Lipitor Patent Challenge: Pfizer Concedes to Give Up Original Broad Patent Claims. Or, does it? PUBPAT touted that in the challenge it filed last year against Pfizer Inc.'s patent on Lipitor, "Pfizer has conceded to significantly narrow the patent to specifically exclude the form of atorvastatin tested in its early clinical trials for Lipitor."

The press release goes on to state that "This is a substantial victory for the public," said Dan Ravicher, PUBPAT's Executive Director. "Pfizer has been caught with its hand in the cookie jar and is correctly giving up the undeserved breadth of the patent it was originally issued." (See U.S. patent 5,969,156)

Well, the amendments clearly give up some subject matter (amorphous atorvastatin) so the claims are in fact narrower. However, I would argue that the real question is "Does this matter to Pfizer?" I would say the answer is "Probably not."

For a different kind of patented invention (say, an electronic device), this getting your broad claim narrowed could be devastating since the disclaimed subject matter (product) could be easily marketed immediately as an equivalent. However, the present patent covers Form I crystalline atorvastatin calcium trihydrate, which is the active ingredient in the drug Lipitor, and the only form approved by the FDA.

Therefore, you could argue that competitors are now free to make, use and sell the amorphous solid form of atorvastatin but they would need to get FDA approval for that form in order to sell it in the U.S. But, FDA approval usually requires 10 to 12 years of development and 100 – 800 million dollars in development costs. And, this could all be for a drug that may not work as well. The FDA approval process thus creates a second layer of exclusive protection.

Competitors are not going to spend this type of time and money to effectively gain a "generic" version of the drug (as they would not have exclusivity). The best a competitor could hope for is that they could take some of the market share away from Pfizer but they could only gain that market share by cutting the price. However, this could effectively prevent them from recouping the R&D costs since the competitor would not have had the benefit of years of exclusivity. Companies would generally be better off waiting until the drug is off patent and then marketing a true generic.

It might be possible for a competitor to file an FDA application using the Abbreviated New Drug Approval (ANDA) process to gain approval but it requires a showing that the proposed drug is the same as, or bioequivalent to, the FDA approved drug (which seems unlikely given the declarations by Pfizer in this case that the drugs are indeed different).

I think Pfizer has come out pretty well in this re-exam.

See more by PUBPAT here.

We reported earlier that the U.S. Patent and Trademark Office (USPTO) issued a ruling against one of several patents that Pfizer holds on Lipitor (atorvastatin), its top-selling cholesterol drug. In the reexamination proceeding initiated last year by the Public Patent Foundation ("PUBPAT"), the USPTO rejected all 44 of the claims of U.S. patent 5,969,156 when it ruled that Pfizer's arguments for securing the patent in 1999 were invalid. PUBPAT's Request for Re-examination alleged that the claims of the '156 patent are anticipated by U.S. patents 5,273,995 and 5,686,104 as having disclosed crystalline atorvastatin.

Now, the tide has turned. On Nov. 23, 2005, the Examiner issued a Notice of Intent to Issue Ex Parte Re-Examination Certificate. Included in the allowed claims are 21 of the original claims, 13 amended claims and 73 newly presented claims!

In the Statement of Reasons for Patentability and/or Confirmation, the Examiner stated that:

Claims 1-117 are allowed because they are directed to crystalline forms of atorvastatin which are not found in the prior art. More specifically, the prior art form of atorvastatin found in Mills et al (US 5,686,104) and Roth (US 5,273,995) are amorphous compared to the instant claims which are crystalline forms of the same compound.

In its response, Pfizer submitted declarations showing the x-ray powder diffraction analysis of the atorvastatin calcium compounds of the prior art as compared to the compounds claimed in the '156 patent. Claims 2, 4, 5, 9 and 31 were amended to correct a typographical error while claims 1, 28, 29, 36 and 38 were amended. In doing so, Pfizer admitted that "it has now been determined that it is possible, although unlikely, that certain lots of atorvastatin calcium used in early clinical trials might be argued to fall within the scope of some of the broad originally issued claims of the '156 patent." The claims have now been amended to limit the claims to a crystalline Form I atorvastatin hydrate having an X-ray powder diffraction containing the following 2-theta value measured using CuK-alpha radiation: 22.0.

In its response, Pfizer stated that atorvastatin is an "unusual" molecule that exists in a large number of polymorphs with various "amorphous" forms and a greater number of different crystalline forms but that Form I crystalline atorvastatin calcium trihydrate is the active ingredient in Lipitor and the only form ever marketed by Pfizer. They also stated that the original atorvastatin calcium utilized by Pfizer in early development was an amorphous solid. Pfizer then points out the differences between the amorphous and crystalline atorvastatin, including chemical stability, impurities, particle size and dissolution profiles.

The '156 patent at issue with the current re-exam is set to expire in 2017, thus extending the useful patent protection of the drug (keep in mind that Lipitor is set to become the world's first $10-billion-a-year drug so the stakes are extremely high).

Although the '156 patent is one of five patents listed by Pfizer with the U.S. Food and Drug Administration (FDA) for atorvastatin, it is the only one asserted by Pfizer in patent infringement lawsuits filed last year against web sites selling generic atorvastatin to Americans. Two are under review by a Delaware court and the remaining two have never been asserted by Pfizer against any competitor to Lipitor.

-------------------------------------------

Dowload the Notice of Intent to Issue Ex Parte Re-Examination Certificate here.

Download Applicant's Amended Claims Set here.

Earlier, the USPTO required that business method inventions must apply, involve, use or advance the "technological arts". This requirement could be met by merely requiring that the invention be carried out on a computer.

In Ex parte Lundgren, Appeal No. 2003-2088, Application 08/093,516, (Precedential BPAI opinion September 2005), the Board rejected the examiner's argument that Musgrave and Toma created a technological arts test. "We do not believe the court could have been any clearer in rejecting the theory the present examiner now advances in this case." Lundgren, at 8.

The Board held that "there is currently no judicially recognized separate "technological arts" test to determine patent eligible subject matter under § 101." Lundgren at 9. USPTO personnel should no longer rely on the technological arts test to determine whether a claimed invention is directed to statutory subject matter. There is no other recognized exceptions to eligible subject matter other than laws of nature, natural phenomena, and abstract ideas. For an excellent review, see Dennis Crouch's summary on Patently-O.

35 U.S.C. § 101 provides: Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title.

In eliminating the Patent Office's view of rejecting patents under 35 U.S.C. § 101 as outside of the "technological arts", the BPAI concluded that:

Our determination is that there is currently no judicially recognized separate "technological arts" test to determine patent eligible subject matter under § 101. We decline to create one. Therefore, it is apparent that the examiner's rejection can not be sustained. Judge Barrett suggests that a new ground of rejection should be entered against the claims on appeal. We decline at this stage of the proceedings to enter a new ground of rejection based on Judge Barrett's rationale, because in our view his proposed rejection would involve development of the factual record and, thus, we take no position in regard to the proposed new ground of rejection. Accordingly, the decision of the examiner is reversed.

The USPTO has now issued guidelines to assist examiners in determining, on a case-by-case basis, whether a claimed invention falls within a judicial exception to statutory subject matter (i.e., is nothing more than an abstract idea, law of nature, or natural phenomenon), or whether it is a practical application of a judicial exception to statutory subject matter. The guidelines explain that a practical application of a 35 U.S.C. § 101 judicial exception is claimed if the claimed invention physically transforms an article or physical object to a different state or thing, or if the claimed invention otherwise produces a useful, concrete, and tangible result.

DETERMINE WHETHER THE CLAIMED INVENTION COMPLIES WITH THE SUBJECT MATTER ELIGIBILITY REQUIREMENT OF 35 U.S.C. § 101(a).

Consider the Breadth of 35 U.S.C. § 101. Under Controlling Law Section 101 of title 35, United States Code, provides: Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title. In 1952, when the patent laws were recodified, Congress replaced the word "art" with "process," but otherwise left Jefferson's language intact. The Committee Reports accompanying the 1952 Act inform us that Congress intended statutory subject matter to "include anything under the sun that is made by man." S. Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952); H.R. Rep. No. 1923, 82d Cong., 2d Sess., 6 (1952). [Footnote omitted] 35 U.S.C. § 101 defines four categories of inventions that Congress deemed to be the appropriate subject matter of a patent: processes, machines, manufactures and compositions of matter. The latter three categories define "things" or "products" while the first category defines "actions" (i.e., inventions that consist of a series of steps or acts to be performed). See 35 U.S.C. 100(b) ("The term 'process' means process, art, or method, and includes a new use of a known process, machine, manufacture, composition of matter, or material."). The subject matter courts have found to be outside of, or exceptions to, the four statutory categories of invention is limited to abstract ideas, laws of nature and natural phenomena.

Determine Whether the Claimed Invention Falls Within An Enumerated Statutory Category. To properly determine whether a claimed invention complies with the statutory invention requirements of 35 U.S.C. § 101, USPTO personnel must first identify whether the claim falls within at least one of the four enumerated categories of patentable subject matter recited in section 101 (process, machine, manufacture or composition of matter). The question of whether a claim encompasses statutory subject matter should not focus on which of the four categories of subject matter a claim is directed to -- process, machine, manufacture, or composition of matter -- [provided the subject matter falls into at least one category of statutory subject matter] but rather on the essential characteristics of the subject matter, in particular, its practical utility.

Determine Whether the Claimed Invention Falls Within § 101 Judicial Exceptions - Laws of Nature, Natural Phenomena and Abstract Ideas While abstract ideas, natural phenomena, and laws of nature are not eligible for patenting, methods and products employing abstract ideas, natural phenomena, and laws of nature to perform a real-world function may well be. In evaluating whether a claim meets the requirements of section 101, the claim must be considered as a whole to determine whether it is for a particular application of an abstract idea, natural phenomenon, or law of nature, rather than for the abstract idea, natural phenomenon, or law of nature itself. Determine Whether the Claimed Invention Covers Either a § 101 Judicial Exception or a Practical Application of a § 101 Judicial Exception

Determine Whether the Claimed Invention is a Practical Application of an Abstract Idea, Law of Nature, or Natural Phenomenon (§ 101 Judicial Exceptions). To satisfy section 101 requirements, the claim must be for a practical application of the § 101 judicial exception, which can be identified in various ways: ..The claimed invention "transforms" an article or physical object to a different state or thing. ..The claimed invention otherwise produces a useful, concrete and tangible result, based on the factors discussed below. a. Practical Application by Physical Transformation b. Practical Application That Produces a Useful, Concrete, and Tangible Result

In determining whether a claim provides a practical application that produces a useful, tangible, and concrete result, the examiner should consider and weigh the following factors:

(1) "USEFUL RESULT" For an invention to be "useful" it must satisfy the utility requirement of section 101. The USPTO's official interpretation of the utility requirement provides that the utility of an invention has to be (i) specific, (ii) substantial and (iii) credible.

(2) "TANGIBLE RESULT" The tangible requirement does not necessarily mean that a claim must either be tied to a particular machine or apparatus or must operate to change articles or materials to a different state or thing. However, the tangible requirement does require that the claim must recite more than a § 101 judicial exception, in that the process claim must set forth a practical application of that § 101 judicial exception to produce a real-world result. (3) "CONCRETE RESULT" Usually, this question arises when a result cannot be assured. In other words, the process must have a result that can be substantially repeatable or the process must substantially produce the same result again.

Determine Whether the Claimed Invention Preempts an Abstract Idea, Law of Nature, or Natural Phenomenon (§ 101 Judicial Exceptions). Even when a claim applies a mathematical formula, for example, as part of a seemingly patentable process, the examiner must ensure that it does not in reality "seek[] patent protection for that formula in the abstract." Diehr, 450 U.S. at 191, 209 USPQ at 10.

Bill Heinze over at I/P Updates noted an article in Managing Intellectual Property on October 18, 2005, where USPTO Commissioner Jon Dudas is quoted as calling on companies and patent prosecutors to help the Office improve the timeliness and quality of patent examinations by calling for "a reduction in the number of continuations, fewer claims for each application and a limit to the number of supporting references."

Limiting the number of references? Huh? And then be disbarred for failure of duty to disclose? As Bill notes:

Perhaps we could just start with eliminating restriction, election, and final action practices at the USPTO, before we dismantle the duty of disclosure. While the patent bar can no doubt do more to make claims easier to read, much less examine, I'm not sure that practitioners have that much control over the volume of continuing applications and supporting references.

Regarding continuations, Dudas said that applicants need to help by reducing examiners' workloads:

As an example, Dudas cited the number of continuations – applications amended after an initial rejection – which the Office handled. "Out of 375,000 applications we received last year, 100,000 were [continuations]. When one-quarter of our work is rework, we look at that," said Dudas, adding that "examiners are concerned about the quality of applications coming through the door".

The fact that between 20,000 and 30,000 applications every year are second continuations makes the problem worse, said Dudas. As a result, he said, the Office is looking at whether there should be a limit to continuations.

It would be a financial disaster for applicants if continuations were limited. With restriction practice running out of control, especially in the biotech and pharmaceutical arts, how would companies know what to file in a single application? You would have to file numerous "original" applications for each invention.

I recently had an application that had a straight-forward set of claims with a composition and method of using the composition. The Examiner returned a two-way restriction: one for the composition, one for the method. I traversed arguing that the method is just used with the composition and requesting withdrawal of the restriction.

I got back a response from the Examiner stating that "Yes, I was right and the restriction was being withdrawn." Then in the next paragraph I got "Oh, and by the way, I'm issuing a new restriction for these TWENTY-EIGHT inventions I think are included in the claims."(!)

The one startling fact in the article was that USPTO figures show that 23% of all claims come from just 7% of applications. I guess someone is paying some hefty claim fees.

The USPTO published revised procedures for presenting preliminary amendments upon filing of a patent application. If on filing an application, an applicant includes a preliminary amendment to the specification, then the publication of the application must be based on the specification and drawings as amended by the preliminary amendment.

The only format for an amendment to the specification (other than the claims) that is usable for publication is a substitute specification in compliance with 37 CFR 1.121(b)(3) and 1.125. As a result, the USPTO has revised its procedures to mail a notice (e.g., "Notice to File Corrected Application Papers") requiring a substitute specification in compliance with 37 CFR 1.121(b)(3) and 1.125, if an applicant included a preliminary amendment to the specification (other than the claims) on filing.

The specific reference to the prior application required by 35 U.S.C. 120 or 119(e) and 37 CFR 1.78(a) can be submitted in an application data sheet (ADC) under 37 CFR 1.76 rather than in a preliminary amendment to the first sentence(s) of the specification. See 37 CFR 1.78(a)(2)(iii) and (5)(iii). If the specific reference is submitted in a preliminary amendment, however, a substitute specification will not be required if the preliminary amendment only adds or amends a benefit claim to a prior-filed application under 35 U.S.C. 120,121, 365(c), or 119(e).

Because a preliminary amendment to the claims or abstract in compliance with 37 CFR 1.121 (c) or 1.121 (b)(2) would include a complete claim listing or replacement abstract, the PTO can publish the amended claims or a replacement abstract as submitted in the preliminary amendment without a substitute specification being filed.

Note, however, that there is no need to file a preliminary amendment to the claims on filing. By making the new claim set part of the originally filed specification, applicant may avoid having to pay an application size fee, as both the specification (including the claims) and any preliminary amendment are used in counting the number of pages for purposes of 37 CFR 1.16(s).

The claim set submitted should be the set of claims intended to be examined, and when the claims submitted on filing are part of the specification (on sequentially numbered pages of the specification), no status identifiers and no markings showing the changes need to be used. A preliminary amendment filed upon the entry of the national stage of an international application under 35 U.S.C. 371 is not part of the original disclosure so the patent application publication need not include such an amendment.

See the Notice here.

Blawg Review #28 is up and running at J. Craig Williams' blog site May It Please The Court. There were a number of blog sites mentioned we haven't seen before.

We particularly enjoyed reading about the USPTO's decision in the Eolas matter finding the patent of Eolas' web browsing technology valid and will issue a re-examination certificate of the patent first challenged by Microsoft Corp. two years ago. Steve Murphy's Lawyers and Business Executives in the News highlights the significance that this brings to Microsoft.

Earlier, Eolas sued Microsoft, alleging that Microsoft had infringed on their patent by including Eolas technology in their web browser. In the jury trial against Microsoft, Eolas was awarded $521 million in damages as the jury found that Microsoft infringed on the patent. Microsoft then claimed that the patent was invalid since another similar technology was available to the public in 1993.

U.S. Patent No. 5,838,906 (the ‘906 patent) was first issued to the University of California on Nov. 17, 1998. Reexamination of the patent was initiated by the PTO director in October 2003 after Microsoft was found liable for patent infringement in a lawsuit brought by UC and Eolas Technologies Inc., the company to whom UC exclusively licensed the ‘906 patent.

In its Reasons for Patentability/Confirmation notice, the patent examiner rejected the arguments for invalidating UC’s previously approved patent claims for the web-browser technology as well as the evidence presented to suggest that the technology had been developed prior to the UC innovation. The examiner considered the Viola reference – the primary reference asserted by Microsoft at trial – and found that Viola does “not teach nor fairly suggest that instant ‘906 invention, as claimed.”

In a preliminary ruling, the U.S. Patent and Trademark Office (USPTO) has issued a double-patenting rejection on a Genentech patent indicating that the patent, awarded in 2001, covered basically the same invention as an earlier Genentech patent that was set to expire next March. Genentech called the patent examiner's action "a routine and expected next step in the reexamination procedure." A final resolution could take months or years and the patent will remain enforceable in the meantime. The request to reexamine the patent was made in May by a Chicago lawyer but it's not known which company or companies are represented.

The patent, known as the Cabilly patent after the lead inventor, Shmuel Cabilly, covers what Genentech calls "the 'fundamental technology required for the artificial synthesis of antibody molecules," which are the basis for many of the best-selling drugs produced by the biotechnology industry. Genentech gets an estimated $300 million a year in royalties on sales of drugs like Enbrel from Amgen, Remicade from Johnson & Johnson and Synagis from MedImmune. The patent claims:

1. A process for producing an immunoglobulin molecule or an immunologically functional immunoglobulin fragment comprising at least the variable domains of the immunoglobulin heavy and light chains, in a single host cell, comprising the steps of:

(i) transforming said single host cell with a first DNA sequence encoding at least the variable domain of the immunoglobulin heavy chain and a second DNA sequence encoding at least the variable domain of the immunoglobulin light chain, and

(ii) independently expressing said first DNA sequence and said second DNA sequence so that said immunoglobulin heavy and light chains are produced as separate molecules in said transformed single host cell.

For background, on March 25, 1983, Celltech filed in the United Kingdom a patent application directed to methods of making recombinant antibodies and antibody fragments, together with vectors and host cells useful in these processes. Celltech filed a related patent application in the United States, which issued as U.S. Patent No. 4,816,397 ("the Boss Patent"). On April 8, 1983, about two weeks after Celltech’s original U.K. filing, Genentech filed a United States patent application directed to similar technology, which issued as U.S. Patent No. 4,816,567 ("the Cabilly Patent"). The Boss Patent and the Cabilly Patent issued on the same day, and both were scheduled to expire on March 28, 2006.

After Celltech’s Boss Patent issued, Genentech copied the Boss Patent claims into a previously-filed Cabilly Patent continuation application. As a result, the United States Patent and Trademark Office declared an interference between Celltech’s issued Boss Patent and Genentech’s Cabilly Patent continuation application to determine who was the first to invent, and therefore which company would be entitled to a patent on, the claimed invention. Seven years after the Genentech-Celltech interference began, the Patent Office determined that Celltech’s inventors, and thus Celltech, were entitled to the patent. Why it took so long isn't clear - it seems that neither party had sufficient incentive to expedite the process.

Genentech appealed the Patent Office decision by filing a civil action in the United States Federal District Court for the Northern District of California. Following two years of discovery, i.e., more than nine years into the dispute, the District Court denied Genentech’s motions that it was entitled to a patent on the disputed technology. In briefing those motions Genentech and Celltech each argued that the other was not entitled to a patent. Shortly after the District Court ruled on those motions, Genentech and Celltech settled their dispute by entering into an agreement which resulted in the District Court's issuing an order directing the Patent Office (i) "to vacate the decision in [the prior interference proceeding], (ii) "to revoke and vacate [the Boss Patent]," and (iii) "to grant and issue to Genentech’s inventors … a United States patent [with the same claims as the Boss Patent]."

The USPTO ultimately revoked the Boss Patent and issued a new United States patent, U.S. Patent No. 6,331,415 to Genentech ("the New Cabilly Patent"). All the claims originally issued in the revoked Boss Patent subsequently issued in the New Cabilly Patent. As a result, while the disputed invention was originally scheduled to pass into the public domain in 2006 upon expiration of the Boss Patent, it is now owned exclusively by Genentech until 2018, which is when the New Cabilly Patent is scheduled to expire.

MedImmune is now claiming that Genentech and Celltech conspired improperly to secure for themselves, through 2018, a dominant and exclusive position in the recombinant antibody field. But, it's too early to try to predict the outcome so it is not clear yet if companies developing recombinant antibody-based products will become free and clear of the Boss Patent and the Cabilly Patent in 2006.

The USPTO has issued a set of final rules to implement the Cooperative Research and Technology Enhancement Act of 2004 (CREATE Act) that amended Section 103(c) of the Patent Act effective September 14, 2005. As we described in an earlier post, the purpose of the Act is to promote cooperative research, such as between a university and start-up company by excluding prior art from obviousness (103) consideration if the prior art arose from a joint research agreement.

The newly implemented rules do not require a statement of the field of the claimed invention or a statement of the date of execution of the agreement. A processing fee of $130 will be required and the applicant must provide a "statement of compliance."

The CREATE Act amends 35 U.S.C. 103(c) to provide that subject matter developed by another person shall be treated as owned by the same person or subject to an obligation of assignment to the same person for purposes of determining obviousness if three conditions are met: (1) The claimed invention was made by or on behalf of parties to a joint research agreement that was in effect on or before the date the claimed invention was made; (2) the claimed invention was made as a result of activities undertaken within the scope of the joint research agreement; and (3) the application for patent for the claimed invention discloses or is amended to disclose the names of the parties to the joint research agreement. See Pub. L. 108–453, 118 Stat. 3596 (2004). Section 2 of the CREATE Act specifically amended 35 U.S.C. 103(c) to provide that:

(1) Subject matter developed by another person, which qualifies as prior art only under one or more of subsections (e), (f), and (g) of section 102 of this title, shall not preclude patentability under this section where the subject matter and the claimed invention were, at the time the claimed invention was made, owned by the same person or subject to an obligation of assignment to the same person.

(2) For purposes of this subsection, subject matter developed by another person and a claimed invention shall be deemed to have been owned by the same person or subject to an obligation of assignment to the same person if—

(A) The claimed invention was made by or on behalf of parties to a joint research agreement that was in effect on or before the date the claimed invention was made;

(B) The claimed invention was made as a result of activities undertaken within the scope of the joint research agreement; and

(C) The application for patent for the claimed invention discloses or is amended to disclose the names of the parties to the joint research agreement.

(3) For purposes of paragraph (2), the term "joint research agreement" means a written contract, grant, or cooperative agreement entered into by two or more persons or entities for the performance of experimental, developmental, or research work in the field of the claimed invention.

The CREATE Act provides that its amendments shall not affect any final decision of a court or the Office rendered before December 10, 2004, and shall not affect the right of any party in any action pending before the Office or a court on December 10, 2004, to have that party’s rights determined on the basis of the provisions of title 35, United States Code, in effect on December 9, 2004. Since the CREATE Act also includes the amendment to 35 U.S.C. 103(c) made by § 4807 of the American Inventors Protection Act of 1999 (see Pub. L. 106–113, 113 Stat. 1501, 1501A– 591 (1999)), the change of "subsection (f) or (g)" to "one or more of subsections (e), (f), or (g)" in 35 U.S.C. 103(c) is now also applicable to applications filed prior to November 29, 1999, which were pending on December 10, 2004. 35 U.S.C. 103(c) as amended by the CREATE Act continues to apply only to subject matter which qualifies as prior art under 35 U.S.C. 102(e), (f) or (g), and which is being relied upon in a rejection under 35 U.S.C. 103. If the rejection is anticipation under 35 U.S.C. 102(e), (f), or (g), 35 U.S.C. 103(c) cannot be relied upon to disqualify the subject matter in order to overcome the anticipation rejection. Because the CREATE Act applies only to patents granted on or after December 10, 2004, the recapture doctrine may prevent the presentation of claims in reissue applications that had been amended or cancelled (e.g., to avoid a rejection under 35 U.S.C. 103(a) based upon subject matter that may now be disqualified under the CREATE Act) during the prosecution of the application which resulted in the patent for which reissue is sought. See H.R. Rep. No. 108–425, at 6–7 (2003). The Office published an interim rule to revise the rules of practice in title 37 of the Code of Federal Regulations (CFR) to implement the CREATE Act. See Changes to Implement the Cooperative Research and Technology Enhancement Act of 2004, 70 FR 1818 (Jan. 11, 2005), 1291 Off. Gaz. Pat. Office 58 (Feb. 8, 2005) (interim rule). This final rule further revises the rules of practice in title 37, CFR, to implement the CREATE Act.

The final rule is here.

I've been hoping to see some let up on the "patent troll" whiney tantrums we've been seeing of late. Geez, even the BBC News, which should know better, took up the issue and re-printed old arguments that keep showing up like a bad penny.

One BBC article quotes FTC commissioner Mozelle Thompson saying some companies use patents "in an anti-competitive way, sometimes to prevent other products from getting to market, to prevent people from sharing ideas and to prevent the kind of innovation that the patent system is really trying to spur on." Note to Mozelle: "Get over it." Companies don't have an obligation to give things away just because you want it and don't want to pay for it. It's a dog-eat-dog world out there.

A recent Tech Dirt posting by Mike (NOTE: I don't know who Mike is, I couldn't find any info other than Tech Dirt offers some sort of corporate intelligence <insert your oxymoron joke here>), took offence with the former Patent Office director, James Rogan, indicating he is off-base in saying there's nothing wrong with companies patenting something and then refusing to do anything with it.

Tech Dirt feels that this is contrary to the original purpose of the patent system, that is, To promote the Progress of Science and useful Arts [U.S. Constitution, Art. I, Section 8]. Tech Dirt believes that patenting something and "then not doing anything with it other than suing companies who actually do innovate completely goes against the purpose of the patent system." Really?

As we've written before, many people who complain about patents are only concerned about the impact they may be feeling at a particular moment. It's selfish greed, really. This always comes up whenever someone wants to make a product and the rights holder won't give them permission or whenever a patent holder asserts some rights against another. But those are the perks given by the system, the right to exclude others. Our great Founding Fathers looked beyond the immediate gratification we hold dear today and saw that the real value of the patent system is the investment over the long run.

The key part of the Constitutional clause is the phrase "securing for limited times" of patent rights. Although 20 years may seem like a lifetime to many (including my 8-year-old daughter with an incredibly short patience threshold), the true value comes over centuries of discoveries, the many lifetimes of hard work, all published for everyone to study and research. Yes, one may be blocked from development of certain technologies for 20 years but once the term has lapsed, the benefits run for all of eternity.

That seems like a pretty good bargain for the public as well as businesses that can take this freed knowledge and leap-frog ahead in promoting the useful arts. Without it, we'd still be using slate & chalk.

Today's post comes from Guest Barista C. Lee Thomason, a registered patent attorney and senior litigator at Frost Brown Todd LLC, writing on whether or not inequitable conduct claims in a patent suit should be heard in open court, or confined to a "special office" as proposed in the draft Patent Act of 2005 (H.R. 2795):

Nonetheless, my further inquiry sought to draw a fair comparison between the old way that courts resolved the defense of inequitable conduct, and the proposed new way of handling that first in the USPTO, and then in the courts. To do that, I looked at several pharmaceutical cases and their online dockets, to gauge how long the time frame was from inequitable conduct being pleaded to it being decided. That set a baseline for the old way of handling the issue. From there, I wanted to compare that time frame with, or how that may change if, the new way proposed in the draft Patent Act of 2005 became law.

Consider some recent district court decisions, which arise from the filing of an ANDA for approval of a generic drug, and which decide the issue of inequitable conduct. By way of background, the filing of an ANDA is deemed an act of infringement under 35 U.S.C. §271(e)(2). Coincidentally, two of the decisions involve Aventis Pharmaceutical.

In August, 2003, the infringement complaint was filed in Aventis Pharma S.A. v. Amphastar Pharms., Inc., 2005 U.S. Dist. LEXIS 12510 (C.D. Cal. June 15, 2005). After the complaint was amended, an amended answer pleaded inequitable conduct in May or June, 2004 (see, dkt # 274 in 5:05cv887). A opinion and order granted summary judgment on the inequitable conduct defense on June 15, 2005. Thus, in a one-year span, the defense was pleaded, discovery was taken, motions were made, and the issue was decided.

The suit commenced June, 2002 in Impax Labs., Inc. v. Aventis Pharms., Inc., 333 F. Supp. 2d 265, 2004 U.S. Dist. LEXIS 17321 (D. Del. 2004), as a declaratory judgment action, alleged invalidity and inequitable conduct. Id., at 268. By stipulation in April, 2003, Impax agreed that if valid and enforceable, the patent would be infringed by the drug described in the ANDA (see, dkt. # 93, in 02cv581). In June, 2003, the briefing of a summary judgment motion on the unenforceability defense was completed. The case was tried in late October 2003 (Id., at 268), and after post-trial submissions, the issues were decided August, 2004. The inequitable conduct defense apparently was present from the outset of the case (although an amended complaint was presented in April, 2003), even so, the time from pleading to resolution was about 26 months.

Consider further the recently decided Oxy-Contin case, in Purdue Pharma L.P. v. Endo Pharms., Inc., 410 F.3d 690, 2005 U.S. App. LEXIS 10416 (Fed. Cir. 2005). As the docket in 01cv8177 indicates, the infringement suit was filed in August, 2001, followed by Endo’s counterclaim in late September, 2001 which presumably alleged inequitable conduct. The antitrust case was severed in December, 2002, and as the Federal Circuit’s opinion notes, a trial on the patent issues occurred “in June 2003.” The District Court ruled in January, 2004. Thus, the time from the pleading to the disposition of the inequitable conduct defense (and all patent issues) was about 40 months. Those three results (13, 26 & 40 months) compare too with the 24 months from pleading to decision, in Ferring B.V. v. Barr Labs., Inc., 2005 U.S. Dist. LEXIS 3597 (S.D.N.Y. Feb. 7, 2005), which again, arose from filing of an ANDA for a generic drug.

Presumably, the defense of inequitable conduct in a pharmaceutical case is as complicated as it would be in most any patent case. Also, the stakes and costs of these cases is as high, or higher, than with other litigation over patents in other fields of invention. Yet, the time from pleading to decision, in these recent cases, is not excessive. The average time of around 2 years, over which the defense was pleaded, answered, discovered, tried and decided, is not unreasonable. Many, in my experience most, complex civil cases last at least two years.

Can the proponents of proposals to remove inequitable conduct from the courts, and to create an administrative tribunal to investigate that conduct, can they fairly show that this new procedure will resolve the issue in the same or a shorter time frame that is demonstrated in these recent ANDA cases? I genuinely doubt that the USPTO “special office” can investigate and decide these issues any faster or more efficiently than the U.S. District Courts.

In §136 of the draft Patent Act of 2005, some minimum time frames are set out. After the Court refers the matter §136(c)(4), and notice is provided §136(e)(2)(B), then discovery can commence §136(e)(2)(C). The office is to conclude the investigation and make a preliminary determination “at the earliest practicable time” §136(e)(2)(D). If the preliminary determination is that misconduct may have occurred, then the office has “1 month” to notify the parties, then they get to “respond to the preliminary determination” and they are allowed some “period of time” to “reach a settlement” §136(e)(3)(B). If not settled, and a request is made “within 2 months,” then a “hearing” occurs §136(e)(4)(A) & (B). Next, “1 year after” the request for a hearing was made, the special office will issue a “final” determination. §136(e)(4)(C). A further time period “for settlement” may follow that §136(e)(5), and then an appeal can follow §136(e)(8).

Taken together, the minimum time frame is “1 month” plus “2 months” and “1 year after” all of which totals 15 months. Added to that is the time for the actual investigation, and the settlement period/s. At the end of these “special office” procedures (and perhaps an appeal to the CAFC), the inequitable conduct finding matter can go back to the district court for an unenforceability determination. §136(d).

This approach cannot be faster, based on my experience in district courts and the CAFC, and nothing about it suggests it will be cheaper for the adversaries.

Unstated in the proposed law is the amount of time for the “special office” to investigate and then to make a preliminary determination, and I am unqualified to predict that. However, ask what number of months typically pass to complete the administrative process, that runs from issuance of a final rejection, through an appeal to the BPAI, to decision on that appeal. That action by the BPAI is only a review of the record, and no “investigation” time is required. Does that take less than 24 months? Also, ask how long an interference proceeding takes, especially, when the subject invention is a pharmaceutical method and composition. Is it more or less than 30 months?

My comparison of time frames in ANDA suits that allege inequitable conduct to the estimated time that a USPTO “special office” could handle the same matter is, wholly unscientific. It does raise my genuine concern that the good intentions of those advocating these reforms will not be furthered by the solutions that they advocate. It will not be faster, or less expensive. More broadly, the concern is not about good or ‘bad’ patents, and the solution may not cure the “plague” of inequitable conduct charges. The true inquiry asks, as between a U. S. District Court and the proposed “special office” which one is the forum non conveniens for adjudication of the defense of unenforceability. Having spent my career in those courts, I believe they have more resources and case management skills than an as-yet-unassembled administrative panel.

Under Secretary Jon Dudas identified three new United States Patent and Trademark Office (USPTO) initiatives that will speed patent prosecution, and which will save applicants about $30 million annually at a "town-hall meeting" held last Friday in Chicago. Of course, it was a town hall meeting that charged admission but I digress. According to a press release by the USPTO, the initiatives include changing the rules for appeal conferences, eliminating the backlog of ex parte re-examinations and creating a more transparent office.

Dudas said that USPTO customers will save at least $30 million annually due to a new program this year that allows applicants to request an appeal conference and learn the results before having to file an appeal brief. Currently, when applicants appeal rejections to the Board of Patent Appeals and Interferences (BPAI), they must file a notice of appeal and an appeal brief. The next step is an appeal conference. Statistics demonstrate that appeal conferences result in approximately 60% of cases being returned to the patent corps. I would like to see customers could save even more money by having more and better trained Examiners in order to avoid the necessity of many of the appeals in the first place.

In regard to ex parte re-examinations, the USPTO will change the way it handles requests to ensure that re-examination remains a viable, cost-effective alternative to litigation. According to Under Secretary Dudas, the new system will allow the agency to the complete processing of 420 cases that have been pending for more than two years. Also, three-examiner panels will be assigned to each re-examination, compared to the past practice of assigning a single examiner to each case - all to ensure that current and future ex parte re-examinations take no longer than two years to process.

Dudas also discussed his concept of a more transparent office, pledging to provide USPTO customers not only with more information, but information and numbers that have greater meaning. He spoke at a "town meeting" sponsored by the American Intellectual Property Law Association (AIPLA), the Federal Trade Commission, and the National Academy of Sciences.

As tipped off by Dennis Crouch's Patently Obvious blog, the U.S. Government Department of Health & Human Services (HHS) has requested an inter-partes reexamination of U.S. Pat. No. 6,653,104 for an anti-cancer antibody assigned to Immunomedics, Inc.

See the OG Notice here.

The Washington Post reported that the USPTO rejected a patent on a human hybrid. Stuart Newman of New York Medical College tried to patent a hybrid designed for use in medical research but not yet created. The USPTO stated that the hybrid would be too closely related to a human to be patentable. The inventor wanted to set a legal precedent barring patents on human-like clones. The rejected patent application, filed in 1997, described a technique for combining human embryo cells with cells from the embryo of a monkey, ape or other animal to create a chimera.

Some have expressed concern that the United States Patent and Trademark Office (USPTO) hosted a two-day meeting last week to discuss substantive patent law harmonization. The participants, from 22 countries along with the EPO and EC, issued a Statement of Intent noting that they will convene future meetings to consider "issues with regard to intellectual property and development, including proposals for a WIPO Development Agenda and proposals relating to genetic resources.  Also, they indicated that for future meetings, they will invite "all Members of WIPO Group B, member States of the European Union, the European Commission, Member States of the European Patent Organization, and the European Patent Office."

Some developing countries and consumer groups expressed concern that the meeting was being held in part to circumvent the World Intellectual Property Organization (WIPO) and certain large developing countries that have pushed for a development agenda within WIPO.

While there is a proposal with WIPO for a substantive patent law treaty (SPLT) aimed at harmonizing substantive aspects of national patent laws, many feel that developing nations are using intellectual property issues as a way to push broader development goals.  Harmonization talks have been going on for years with no resolution.  Even with an agreement, I'm not sure how far that will take the developing nations if it doesn't include China, India, and Brazil.

More here.

As part of a proposed $2.57 trillion fiscal year 2006 budget request for the USPTO is $1.7 billion, equaling anticipated FY 2006 fee collections from patent and trademark filings. The request represents a $149 million increase over FY 2005, and reflects an anticipated rise in patent and trademark fee collections. As part of the 21st Century Strategic Plan, the USPTO plans to hire 900 patent examiners and 75 trademark examining attorneys in FY 2006.   

This sounds good but I'm waiting to see if this holds up in light of the record deficits - a projected a $390 billion deficit for next year, down from $427 billion this year.

The United States Patent and Trademark Office revised the policy on when a second or subsequent request for reexamination is filed while an ?earlier filed reexamination? is pending, and the second or subsequent request cites only prior art, which raised a substantial new question of patentability (SNQ) in the pending reexamination proceeding.  See MPEP ? 2240 (8th ed. 2001)(Rev. 2, May 2004).  Under the new policy, the second or subsequent request for reexamination will be ordered only if that old prior art raises a substantial new question of patentability which is different than that raised in the pending reexamination proceeding.  If the old prior art cited (in the second or subsequent request) raises only the same issues that were raised to initiate the pending reexamination proceeding, the second or subsequent request will be denied.

See Notice here.

Under the Consolidated Appropriations Act, 2005 (Consolidated Appropriations Act), the USPTO splits the national fee for Patent Cooperation Treaty (PCT) applications entering the national stage into a separate national fee, search fee and examination fee, during fiscal years 2005 and 2006.  The USPTO announced that it is reducing the search fee and examination fee for certain PCT applications entering the national stage, effective February 1, 2005. The changes in this interim rule apply to all international applications entering the national stage under 35 U.S.C. 371 for which the basic national fee specified in 35 U.S.C. 41 is paid on or after December 8, 2004.

(1) The Office will refund the entire search fee less $100.00 ($50.00 for small entities) if the search fee as set forth in ?? 1.445(a)(2) and (a)(3) has been paid on the international application to the United States Patent and Trademark Office as an International Searching Authority for all of the claims presented in the application entering the national stage; and

(2) the Office will refund $100.00 ($50.00 for small entities) if an international search report on the international application has been prepared and is provided to the Office no later than the time at which the search fee is paid. In addition, under the authority provided in 35 U.S.C. 376, the Office will refund the entire examination fee less $100.00 ($50.00 for small entities) if an international preliminary examination report on the international application prepared by the United States International Preliminary Examining Authority states that the criteria of novelty, inventive step (non-obviousness), and industrial applicability, as defined in PCT Article 33(1) to (4) have been satisfied for all of the claims presented in the application entering the national stage.

See the Federal Register here.

The USPTO has published a final rulemaking to implement the new fee structure.  See the rules description here.  There is a discussion of new section 1.52(f)(1).

Section 1.52: Section 1.52(f)(1) is added to provide that any sequence listing in an electronic medium in compliance with ?? 1.52(e) and 1.821(c) or (e), and any computer program listing filed in an electronic medium in compliance with ?? 1.52(e) and 1.96, will be excluded when determining the application size fee required by ? 1.16(s) or ? 1.492(j). See 35 U.S.C. 41(a)(1)(G) (which provides that a sequence listing or a computer program listing is excluded if filed in an electronic medium as prescribed by the Director).

This is a welcome relief for anyone who was pondering whether or not sequence listings submitted on CD-ROM in lieu of paper copy would count towards your page fee.  Since sequence listings can (and often are) thousands if not tens of thousands of pages, the cost of a provisional could have been an added $5000 per 1000 pages of sequence listing submitted.   Not exactly the $200 originally.

New fee schedule is listed here.

The USPTO released a report that it granted 187,170 patents, including 169,296 utility (inventions), 16,533 design, and 998 plant patents as reported in fiscal year 2004. Since 1790, over seven million U.S. patents have been granted.  See the complete report here.

As reported earlier by MSNBC, however, the patent application backlog will only continue to grow.  While the average pendency is now more than two years, it is predicted to double in five years, unless major changes are made. Obviously, this could have a chilling effect on innovation if venture capitalists feel like the life-cycle of the technology and the uncertainty of getting a patent make the risk of patenting too great. 

Already, the number of pending patent applications has ballooned, especially for complex fields like semiconductors, biotechnology and nanotechnology. There is also a fear that patent quality could go down if examiners don't take the necessary time to evaluate the technology.  There is a risk that patents will only become of value to the large corporations able to duke it out in court over the validity of a patent's claims.

As usual, the finger is pointed to the pilfering of patent office fees by Congress to use in the general fund - more than $650 million as of last year.  This, after fees were raised yet again in December. Nice.

Under the current PTO five-year plan, the office will move to a system that uses fully searchable, Web-like documents. Look for more fee penalties for not filing electronically.  If only someone could come up with a good relacement for ABX.

The World Intellectual Property Organization (WIPO) marked the filing of the one millionth international patent application under the Patent Cooperation Treaty (PCT) in the 26-year history of the PCT.  The Director General observed "While it took 22 years to receive the first half million PCT patent applications, it took only 4 years to top the one million mark, reflecting an astonishing acceleration in the pace of technological development and unprecedented use of the international patent system."  The PCT facilitates the process of obtaining patent protection in more than 120 countries through the filing of a single international application. The largest users of the PCT system have originated from the United States of America, Japan, Germany, the UK and France. That said, the numbers of PCT applications from several developing country members continue to show a marked increase, most notably in India and the Republic of Korea which enjoyed double-digit growth in 2003.

See the entire press release here.

For those who always appreciate that "extra" day to get a filing in, the USPTO will be closed on Monday, 17 January (Martin Luther King Day) and again on Thursday, 20 January (Inaugural Day).

This topic has been kicked around so long it seems like it, like trickle-down economics, is an ideal that is always just out of our grasp.  But, I will at least pass along that the "Committee Oversight Plan 108th Congress" website for the U.S. House of Representative's Subcommittee on Courts, the Internet, and Intellectual Property describes plans to consider a world patent.  Under Article III, U.S. Patent and Trademark Systems, the document describes:

"Single, Low-Cost World Patent. The cost to U.S. companies and inventors of applying for and obtaining separate patents in each of 150 or more countries is prohibitive. In developing countries and even in Europe, patent fees are at such high levels that they constitute a tax on innovation. European government fees to obtain and maintain a patent are more than ten times the fees in the U.S. In addition, the expense of retaining separate patent attorneys or agents in each foreign country is burdensome and expensive. The United States could take a leadership role in negotiating an agreement under which countries would give full faith and credit to patents granted by an international organization or one of the three largest patent offices in the world- the U.S. Patent Office, the European Patent Office, or the Japanese Patent Office. Countries giving full faith and credit would charge a minimal fee for patenting in that country, and it would be unnecessary to retain separate patent attorneys or agents to obtain a patent in that country. The obstacles to negotiating and implementing such an arrangement would be formidable, but a single low-cost world patent is the best long-term approach to obtaining effective world-wide patent protection for U.S. companies and inventors. "

Starting with the Big Three (USPTO, EPO and JPO) makes a lot of sense, though.

The USPTO has released an interim rule of practice that implements provisions of the CREATE Act that amended 35 U.S.C. 103(c). (Published at 70 FR 1818). The purpose of the Act is to promote cooperative research, such as between a university and start-up company by excluding prior art from obviousness (103) consideration if the prior art arose from a joint research agreement.

To overcome a rejection under 35 U.S.C. 103(a)based upon subject matter (whether a patent document, publication, or other evidence)which qualifies as prior art under only one or more of 35 U.S.C.102(e),(f)or (g) via the CREATE Act, the applicant must provide a statement to the effect that the prior art and the claimed invention were made by or on the behalf of parties to a joint research agreement within the meaning of 35 U.S.C.103(c)(3), and that the claimed invention was made as a result of activities undertaken within the scope of the joint research agreement. 35 U.S.C.103(c)(3) defines a "joint research agreement" as a written contract, grant,or cooperative agreement entered into by two or more persons or entities for the performance of experimental, developmental, or research work in the field of the claimed invention, that was in effect on or before the date the claimed invention (under examination or reexamination) was made.

In addition to providing a statement, the applicant must also:

(1) Amend the specification to disclose the names of the parties to the joint research agreement;and

(2) either amend the specification to either set forth the date the joint research agreement was executed and a concise statement of the field of the claimed invention, or specify where (i.e., by reel and frame number) this information is recorded in the assignment records of the Office.

The new rules cannot be used to overcome rejections based on anticipation. Likewise, the PTO indicated that the new rules will likely not apply to reissue applications that were initially granted prior to December 10, 2004.  The PTO is asking for comments before issuance of the final rule.  Send comments to: ab76comments@uspto.gov by February 10, 2005.

The USPTO's Patent Application Information Retrieval (PAIR) sytem now lists expirations due to failure to pay maintenance fees. Expired patents now have a status of "Patent Expired Due to Non-Payment of Maintenance Fees Under 37 CFR 1.362".  Patents can, of course, expire in other ways.  If a patent is subject to a terminal disclaimer relative to a previous patent and they cease to be commonly owned, for example.

The U.S. Congress passed a bill raising patent-filing fees in the Consolidated Appropriations Act, 2005 enacted on December 8, 2004.  The new system's basic filing fee, search fee and examination fee add up to more costs for applicants, but the most significant change may be the fee hike for each claim beyond the first 20 claims.  The increase from $18 to $50 for each additional claim will particularly hit biotechnology patent applications since even run-of-the-mill applications are now filed with 100-200 pages and as many as 100 claims.

The maintenance fees during the patent's lifetime have also increased substantially.  This, on top of current efforts by the U.S. Patent and Trademark Office to step up pressure on applicants to reduce the number of claims and pages.  This does not address the fact the one broad claim can cause more searching work for an Examiner than 50 relatively straight-forward and focused claims.  It is worth noting here that what is disclosed in a patent but not claimed is dedicated to the public.  To get around this limitation in the case of applications having both broad scope and broad disclosure, a patentee will need to file additional applications with terminal disclaimers subjecting themselves to multiple maintenance fees.

Of course, the big issue for patentees is that a lot of the money is going into the general government fund and not staying at the patent office to improve efficiency and the quality of prosecution. According to the Intellectual Property Owners Association in Washington, D.C., the federal government has diverted three-quarters of a billion dollars in fees from the patent office since 1992.

The AIPLA has this nice desciption here.

More from the USPTO here.

An article in the IEEE publication, Spectrum, calls for "a radical cure for the ailing U.S. patent system." As proof, they cite the fact that a small grocery and catering company in Michigan received cease and desist letter from the J.M. Smucker Co. The letter accused Albie's of violating Smucker's U.S. Patent No. 6,004,596 by selling crustless peanut butter and jelly sandwiches.

The article takes the "big, bad corporations and their high-paid lawyers" against the "sweet, friendly mom-and-pop store" tact.  You can almost smell the apple pie baking in the background.   It goes on to state that the "beginning of the end" occurred when the U.S. Congress, in 1982, made the U.S. Patent and Trademark Office (PTO) fund itself through application and maintenance fees.

The article argues that this makes it easier to obtain patents, to enforce patents against others, and to extract large financial awards from such enforcement but harder for those accused of infringing patents to challenge the patents' validity.

The authors go on to stat the our "patent system costs companies and individuals billions of dollars and millions of man-hours annually to obtain patents and fight frivolous lawsuits." Huh?  Isn't the patent system designed so that companies and individuals can get patents, exploit the technology and make money? 

While I agree that patents are being more actively sought and vigorously enforced, this has more to do with our economy shifting to an intellectual property-based system over a traditional manufacturing base.

The article provides three suggestions to "fix" the system:

First, create incentives and opportunities for parties to challenge the novelty and nonobviousness of an invention before the PTO grants a patent.

Didn't the American Inventors Protection Act of 1999 (AIPA) provide for this in third-party submissions and Inter Partes Reexamination?

Second, provide multiple levels of application review, with examiners devoting successively more time and effort as an application proceeds to higher levels. The goal would be to avoid wasting money to meticulously examine unimportant patents, while taking sufficient care to avoid mistakes where the stakes are high.

I'd like to see who gets the job of deciding which patents are the "unimportant" ones!

Finally, in cases involving claims of patent invalidity based on the existence of prior art?that is, previously issued patents or public disclosures covering the invention at issue?replace juries with judges who could call on experts, called special masters, for guidance. The change would give parties threatened by invalid patents a better opportunity to make their cases to the court.

Every legal specialty could argue the same thing but it is difficult to reconcile with the jury of ones peers system we have in place.

I think everyone would agree that it is a good ideal to strive for improving the quality of patents, reducing uncertainty surrounding the process of innovation, and limiting patent application, maintenance, and litigation costs. But arguing that the entire system is broken because someone obtained a patent on a watch for "keeping animal time" for dogs where it runs seven times as fast as an ordinary watch (U.S. Patent No. 5,023,850), does not prove anything other than the applicant met the minimum requirements for patentability (new, useful and nonobvious).

The USPTO posted an update on the TC1600 Restriction Practice Action Plan announced on October 6, 2003.  This plan is to improve quality and respond to customer needs by establishing best practices related to restrictions on the number of inventions and/or claim sets in biotechnology, pharmaceutical and organic chemistry patent applications examined in Technology Center 1600 (TC 1600).  A first phase of examiner training has been completed that focused on the basic principles of restriction requirements, and included a review of linking claims, Markush practice, and rejoinder issues.  The training material included sample claim sets and corresponding restriction requirements.  The training materials have been posted on the USPTO web site .  Questions or comments concerning the training examples may be addressed to Deborah Reynolds by phone at 571-272-0734

If you haven't seen it, the USPTO offers a little guide on filing a provisional application for a patent. Besides giving a brief overview of the history, purpose and filing date requirements, it offers a nice list of cautions about their use.  As patent attorneys soon find out, inventors hear about provisional patent applications and then come to you asking for one of those $100 applications.

I'm thinking of keeping the list of cautions as a stock document to send to prospective patentees so that I ensure they are duly warned.  See below:

Cautions

Provisional applications are not examined on their merits.

The benefits of the provisional application cannot be claimed if the one-year deadline for filing a non-provisional application has expired.

Provisional applications cannot claim the benefit of a previously-filed application, either foreign or domestic.

It is recommended that the disclosure of the invention in the provisional application be as complete as possible. In order to obtain the benefit of the filing date of a provisional application the claimed subject matter in the later filed non-provisional application must have support in the provisional application.

If there are multiple inventors, each inventor must be named in the application.

The inventor(s) named in the provisional application must have made a contribution to the invention as described.  If multiple inventors are named, each inventor named must have made a contribution individually or jointly to the subject matter disclosed in the application.

The non-provisional application must have one inventor in common with the inventor(s) named in the provisional application to claim benefit of the provisional application filing date.

A provisional application must be entitled to a filing date and include the basic filing fee in order for a non-provisional application to claim benefit of that provisional application.

There is a surcharge for filing the basic filing fee or the cover sheet on a date later than filing the provisional application.

Provisional applications for patent may not be filed for design inventions.

Amendments are not permitted in provisional applications after filing, other than those to make the provisional application comply with applicable regulations.

No information disclosure statement may be filed in a provisional application.

A provisional application cannot result in a U. S. patent unless one of the following two events occur within 12 months of the provisional application filing date:

1. a corresponding non-provisional application for patent entitled to a filing date is filed that claims the benefit of the earlier filed provisional application; or
2. a grantable petition under 37 CFR 1.53(c)(3) to convert the provisional application into a non-provisional application is filed.

Warnings

A provisional application automatically becomes abandoned when its pendency expires 12 months after the provisional application filing date by operation of law. Applicants must file a non-provisional application claiming benefit of the earlier provisional application filing date in the USPTO before the provisional application pendency period expires in order to preserve any benefit from the provisional-application filing.

Beware that an applicant whose invention is "in use" or "on sale" (see 35 U.S.C. ?102(b)) in the United States during the one-year provisional-application pendency period may lose more than the benefit of the provisional application filing date if the one-year provisional-application pendency period expires before a corresponding non-provisional application is filed. Such an applicant may also lose the right to ever patent the invention (see 35 U.S.C. ?102(b)).

Effective November 29, 2000, a claim under 35 U.S.C. 119(e) for the benefit of a prior provisional application must be filed during the pendency of the non-provisional application, and within four months of the non-provisional application filing date or within sixteen months of the provisional application filing date (whichever is later). See 37 CFR 1.78 as amended effective November 29, 2000.

Independent inventors should fully understand that a provisional application will not mature into a granted patent without further submissions by the inventor.  Some invention promotion firms misuse the provisional application process leaving the inventor with no patent.

I would just add that "you get what you pay for" still applies.

As a result of a recent change to the Public PAIR (Patent Application Information Retrieval),  most provisional applications that are relied upon for their earlier filing dates in U.S. patent application publications or U.S. patents are now available to the public over the Internet. Exceptions mainly include provisional applications with filing dates prior to 1997.

Anyone wishing to view and/or print a copy of a provisional application relied upon by an examiner to give prior art effect under 35 U.S.C. 102(e) to a reference applied in a rejection, may do so using the Public PAIR website.

It will be interesting to see how this effects patentability opinions whenever the earlier-filed provisional substantially deviates from the substance of the later-filed regular patent application.  Obviously, for there to be a published provisional patent application, a non-provisional patent application must have been filed claiming priority to the earlier provisional.  More info here.

The USPTO clarified its position concerning the treatment of petitions to withdraw a holding of abandonment that are not timely filed because the applicant failed to exercise reasonable diligence in monitoring the status of the application. The USPTO receives petitions under 37 CFR 1.181(a) to withdraw holdings of abandonment (based on non-receipt of an Office action, or upon non-receipt or loss of a reply by the applicant). Some of these petitions are filed years after the application is held abandoned, causing extensive prosecution delays. To prevent these delays from inappropriately extending the term of any patent issued from the application, the USPTO is clarifying its position concerning the treatment of petitions to withdraw holdings of abandonment that are not timely filed because the applicant failed to exercise reasonable diligence in monitoring the status of the application.

Utility and Plant Applications Filed on or after May 29, 2000.

The term of a patent issuing from a utility or plant application filed on or after June 8, 1995, ends on the date that is twenty years from the filing date of the application, or the earliest filing date for which a benefit is claimed under 35 U.S.C. 120, 121, or 365(c). Utility and plant applications filed on or after May 29, 2000, however, are eligible for patent term adjustment under the American Inventors Protection Act of 1999 (AIPA). Therefore, if a petition to withdraw a holding of abandonment is not filed within two months from the mailing date of the notice of abandonment, any patent term adjustment will be reduced under the provisions of 37 CFR 1.704(c)(4).

If applicant does not receive the notice of abandonment, any patent term adjustment may be reduced under the provisions of 37 CFR 1.704(a) by a period equal to the period of time during which the applicant "failed to engage in reasonable efforts to conclude prosecution" (processing or examination) of the application, in which case any period of adjustment shall be reduced by the number of days, if any, beginning on the day after the date that is twelve months from the date of applicant's filing or submission of correspondence with the USPTO for which further action by the USPTO can reasonably be expected and ending on the filing date of a grantable petition to withdraw the holding of abandonment.

Utility and plant applications filed on or after June 8, 1995, but before May 29, 2000

Utility and plant applications filed on or after June 8, 1995, but before May 29, 2000, are eligible for patent term extension under the Uruguay Round Agreements Act (URAA). The URAA provides for patent term extension only if issuance of the patent was delayed due to: (1) an interference proceeding; (2) imposition of a secrecy order; or (3) successful appellate review. See 35 U.S.C. 154(b) (1994). Unless an application is held abandoned during one of these three periods, the untimely filing of a petition to withdraw a holding of abandonment will not operate to extend the term of the patent because the USPTO has no authority to grant patent term extension under the URAA for other administrative delays. If a petition to withdraw a holding of abandonment is not filed within two months from the mailing date of the notice of abandonment during a period of appellate review, any patent term extension accrued under 37 CFR 1.701(a)(3) (extension due to successful appellate review) may be reduced under the "due diligence" provisions of 37 CFR 1.701(d)(2).

Design Applications, Utility Applications Filed Before June 8, 1995, and Plant Applications Filed Before June 8, 1995

(A) Applicant Receives Notice of Abandonment. In any utility or plant application filed before June 8, 1995, and in any design application, if applicant receives a notice of abandonment, any petition to withdraw the holding of abandonment that is not filed within two months of the mail date of the notice of abandonment will not (absent extraordinary circumstances) be treated on its merits unless accompanied by a terminal disclaimer under 37 CFR 1.321(a), and the required fee set forth in 37 CFR 1.20(d). The period to be disclaimed is the terminal part of the term of any patent granted on the application, or of any patent granted on any utility or plant application that claims the benefit of the filing date of the application under 35 U.S.C. 120, 121, or 365(c), equivalent to the period between:

1. the date that is two months after the mail date of the notice of abandonment; and
2. the filing date of a grantable petition to withdraw the holding of abandonment.

(B) Applicant Does Not Receive Notice of Abandonment. In any utility or plant application filed before June 8, 1995, and in any design application, if applicant never receives the notice of abandonment, any petition to withdraw the holding of abandonment that is not filed within twelve months from the date of applicant's filing (or date of submission, if the correspondence was never received by the USPTO) of correspondence with the USPTO for which further action by the USPTO can reasonably be expected, will not (absent extraordinary circumstances) be treated on its merits unless accompanied by a terminal disclaimer under 37 CFR 1.321(a), and the required fee set forth in 37 CFR 1.20(d). The period to be disclaimed is the terminal part of the term of any patent granted thereon, or of any patent granted on any utility or plant application that claims the benefit of the filing date of the application under 35 U.S.C. 120, 121, or 365(c), equivalent to the period between:

1. the date that is twelve months from the date of applicant's filing or submission of correspondence with the USPTO, for which further action by the USPTO can reasonably be expected; and
2. the filing date of a grantable petition to withdraw the holding of abandonment.

Petitions to revive an abandoned application for unavoidable or unintentional delay under 37 CFR 1.137(a) or (b) are also subject to a terminal disclaimer requirement of 37 CFR 1.137(d). According to the USPTO, "Since practitioners and pro se applicants can monitor the status of their applications using the USPTO?s PAIR and IFW systems, the failure to receive a notice of abandonment (or any other USPTO notification) will not excuse an unreasonable delay in filing a petition to withdraw the holding of abandonment. A status inquiry is in order once six months have elapsed with no response from the USPTO."

Read the full document here.