Yesterday, Commissioner Robert L. Stoll talked about the Leahy-Smith America Invents Act at the 21st All Ohio Annual Institute on Intellectual Property here in beautiful, downtown Cincinnati, Ohio.

While only a cursory review, Stoll went down the highlights of the provisions that need to be understood now.

15% Surcharge

The Leahy-Smith America Invents Act (Public Law 112-29) places a 15 percent surcharge on certain patent fees, effective 10 days after enactment (i.e., September 26, 2011).  A listing of the fees is available here.

Also of note is that October 1, 2011, is the start of Fiscal Year 2012.  The money the Patent Office has for the current Fiscal Year 2011 is already allocated.  So, if you hold off on making payments until on or after October 1, the Patent Office can get access to the extra money (if allocated).  Before that date, it’s just money in the government’s general fund.

Prioritized examination provisions –Track I

The Act establishes a prioritized examination fee of $4,800 (above usual fees) with 50% reduction for small entities, in days’ after enactment.

Program Details:

  • Hope to have first action in 3 months
  • Final disposition on average within 12 months of prioritized examination request grant.
  • Must contain no more than 4 independent claims and 3o total claims.

Supplemental Examination

The patent owner may request supplemental examination of a patent to “consider, reconsider, o orrect” information believed to be relevant to the patent.

The USPTO must conduct the supplemental examination and conclude it by issuing a certificate indicating whether the information raises a substantial new question of patentability (SNQ) within three months of the supplemental examination request date.

Third Party Submission of Prior Art

Allows third parties to submit printed publications of potential relevance to examination.

  • must provide, in writing, an explanation of the relevance of the submitted documents.
  • must pay the associated fees.
  • must include a statement by the third party affirming that the submission is being made in compliance with new 35 USC 122(e)

The submission must be made before the earlier of:

  1. the date a notice of allowance ; or
  2. the later of (i) 6 months after the date first published or (ii) the date of the first rejection of any claim in the application.

Inter Partes Review Proceedings

Moves the inter partes standard from a “substantial new question of patentability” to a higher threshold of “reasonable likelihood that the requester would prevail.”

Petitioner may only raise grounds under 35 U.S.C. §§102 and 103 and only on the basis of prior art consisting of patents and printed publications.

Any third party may petition for a review of the patentability of an issued patent later of 9 months of issuance or termination of post-grant review of that patent.  However, the Director may limit the number of petitions to institute IP review during the first 4 years.

Post-Grant Review Proceedings

Creates a nine month window in which the patentability of a patent can be reviewed but requires a threshold showing that it is “more likely than not” that at least one of the claims challenged is unpatentable.

Petitioner may raise any ground that may be raised under paragraph (2) or (3) of 35 U.S.C. § 282 (b), for example 101, 102, 103, 112 except for best mode.  But, the Director may limit the number of petitions to institute IP review during the first 4 years.

**In 18 months we’ll see the First-Inventor-to-File along with Derivation Proceedings.

Don’t Miss:   America Invents Act Webinar

When: Tuesday, September 27, 2011 @ 1:00pm:
Who: Commissioner Robert L. Stoll
How: American Conference Institute
Registration is complimentary

Robert Stoll was sworn in as Commissioner for Patents on October 5, 2009. Prior to that, Mr. Stoll was Dean of Training and Education. Before his appointment as Dean in 2007, Mr. Stoll served as director of the Office of Enforcement for the United States Patent and Trademark Office (USPTO) for five years beginning in 2002. Mr. Stoll holds a bachelor of science in chemical engineering from the University of Maryland. While working at USPTO, he earned a juris doctor from Catholic University and became a member of the Maryland Bar.

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Like Bieber fever, the itch to mess with the rules for patenting have spread far and wide.  There is currently being considered a Bill to amend Australia’s patent law, which proposes a number of substantial changes.

Description of the invention

Under the proposed legislation, there will be a requirement that the description must enable the claimed invention to be produced across the full scope of each claim and not merely in relation to one among other embodiments. The enablement requirement will have a similar effect to the corresponding provisions of UK legislation, the European Patent Convention and the Patent Cooperation Treaty.  This requirement will also apply to provisional applications; however there will remain no requirement to describe the best mode in a provisional specification.

Introducing new matter

Under the proposed legislation, whether amendments are allowable will no longer be dependent on claim scope but rather whether the amendment changes the description contained in the specification as filed.  Applicants will not be allowed to add new matter that would go beyond the disclosure contained in the specification at its filing date, except to correct a clerical error or obvious mistake.

Fair Basis

The proposed legislation will replace ‘fair basis’ with the European concept of ‘support’, namely: there must be a basis in the description for each claim; and the scope of the claim must not be broader than is justified by the extent of the description, drawings and contribution to the art.


The proposed legislation will introduce the additional requirement that the invention has a specific, substantial and creditable use. The use will need to be set out in the specification.

Omnibus claims

Under the proposed legislation, omnibus claims will be allowed only where strictly necessary. For example, where a chemical composition can only be described with reference to a spectroscopic profile.

Expanded prior art base

The proposed legislation expands obviousness prior art base by removing the requirement that allows only documents or acts that the skilled person could be reasonably expected to have ascertained, understood and regarded as relevant.  While a skilled person will be deemed to be aware of all publicly available prior art information, such information may still be excluded from obviousness considerations if it can be shown that the skilled person could not have appreciated its relevance.

Expanded common general knowledge

The proposed legislation expands the common general knowledge to include knowledge of the skilled worker as it existed anywhere in the world at the priority date.

Practical implications

With the proposed changes to the prior art base and common general knowledge, it seems reasonable to expect that Australian applicants will find obviousness more challenging. In many cases, however, the Australian Patent Office’s practice of relying on the prosecution of corresponding US/European patent applications may result in there being limited real change in this regard.

Infringement exemption for experimental use

An exemption to Australian patent infringement is proposed where the predominant purpose of the relevant act is to gain new knowledge, or to test a principle or supposition regarding a patented invention. Further, the exemption is to apply irrespective of whether the person undertaking the relevant act had in mind to later commercialize, for example, an improvement arising from the act, or whether that person was aware of the patent at the time the relevant act was undertaken.

According to the proposal, a person may undertake an act that would otherwise be an infringement of a patent claim ‘if the act is done for experimental purposes relating to the subject matter of the invention’.

Experimental purposes’ is non-exhaustively defined as including:

  • determining the properties of an invention
  • determining the scope of a claim relating to the invention
  • improving or modifying the invention
  • determining the validity of the patent, or of a claim relating to the invention, and
  • determining whether the patent for the invention would be, or has been infringed by the doing of an act.

Further, the amendment proposes that the experimental activities be ‘related to’ the subject matter of the invention. The intention here is to achieve two outcomes:

  1. that the exemption is to apply to experiments that include the claimed invention, so that the person undertaking the relevant work is not required to conduct patent searches before starting an experiment, and
  2. that the exemption is to apply to experimentation on a patented invention, i.e. it does not cover experimentation using a patented invention. Importantly, it does not follow that infringement of a research tool patent is to be exempted merely because of the proposed amendment.

Acts that remain outside the proposed infringement exemption include those where the purpose is commercialization. These include ‘market research’ – testing the likely commercial demand for a product, and manufacture for the purpose of sale or use for commercial purposes.

Today’s post is by Australian patent attorney with Freehills Patent & Trade Mark Attorneys.


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American Conference Institute’s Biotech Patents Conference:  Practical Strategies for Prosecuting and Litigating Biotech Patents in a Rapidly Shifting Legal Environment.

The biotech industry faces massive, imminent, change with patent reform nearing passage, impending promulgation of biosimilar pathway regulations from the FDA, the continued evolution of case law from the Federal Circuit and an unusually active Supreme Court. Cases like Therasense, Centocor, McKesson, and Myriad are changing long-standing precedents in inequitable conduct, written description requirements, joint infringement, and the patentability of DNA sequences, and have the potential to signifi cantly alter the biotech patent landscape. Additionally, the FDA’s issuance of biosimilar regulation draws closer.

Topics to be discussed include:

  • Analyzing the potential ramifications of patent reform legislation and the promulgation of biosimilar regulations by the FDA
  • Investigating the implications of recent court opinions on the written description requirement, inequitable conduct, joint infringement claims, subject matter patentability, and more
  • Formulating strategies for international patent filing in the EU and developing countries


Wednesday, November 30 to Thursday, December 01, 2011


Omni Parker House, Boston, MA


ACI’s 13th Advanced Forum on Biotech Patents brings together another top-notch faculty of expert biotech patent counsel who will share their experience and knowledge to provide you with strategies to navigate this period of intense uncertainty. Do not miss this opportunity to hear our high quality faculty of senior biotech practitioners share their thoughts and advice on strategic patent filing and effective defense of intellectual property rights.

ACI is also offering informative and hands-on workshops:

  1. A pre-conference Interactive Working Group Session: Integrating Changes at the PTO into Biotech Patent Practices.
  2. A Master Class on Successful and Practical Strategies for Patenting Antibodies will utilize an expert faculty to assist you in protecting and promoting products that are central to the biotech industry.


Be sure to reserve your spot today. Register now by calling 888.224.2480; by faxing your registration form to 877.927.1563; or register online at is a Media Sponsor of this event.  Readers of Patent Baristas are entitled to $200 off the current conference price tier.   The discount code you will need for this is: PB 200.

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On September 16, 2011, President Barack Obama signed into law the Leahy-Smith America Invents Act.   This Act is touted as the most comprehensive overhaul to our patent system since 1836.

The new law is intended to afford more certainty for patent applicants and owners, and provide the USPTO the resources needed to operate efficiently and issue high-quality patents.  Implementation of the new law will occur over a period of months, and our USPTO team will seek input and provide updates all along the way.

Timeline in graphical format:

Here’s a listing of documents available from the USPTO:

Tomorrow, Wednesday, September 21, 2011 @ 2:10pm, Commissioner Robert L. Stoll will talk at the 21st All Ohio Annual Institute on Intellectual Property here in Cincinnati, OH.

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“The pharmaceutical industry is trashed nightly as being second only to the tobacco industry in the corporations-we-hate-most department.”

   ~ Martin Voet

In Martin Voet’s book, The Generic Challenge: Understanding Patents, FDA and Pharmaceutical Life-Cycle Management (third edition), he provides a concise guide to the necessary information so that pharmaceutical executives, managers, regulatory, legal and business development professionals, those involved in strategic marketing and in research and development, among others in the pharmaceutical field, can deal with the increasingly aggressive tactics of generic companies designed to legally copy innovative drug products.

This Third Edition comes with updates on new case law, materials on the interaction of Section 8 skinny labeling and patent use codes, a new section on biosimilars and a new, actual example of life-cycle management.

A Section 8 ANDA is an Abbreviated New Drug Application (ANDA) filing with labeling omitting an approved, but patented, indication.  Thus, it enables the ANDA filers to not have to provide Paragraph IV certification and are not entitled to the first-filer, 180-day exclusivity.  This is the so-called “skinny” labeling or “carve out” filing.  The Section viii certification may only be approved if the composition patents covering the reference listed drug have expired, or will expire, prior to the date of the proposed marketing and sale of the generic drug.  In addition, there must be no overlap between the proposed carve-out label and the use code narrative submitted by the patentee or “innovator” manufacturer.

Proving inducement of infringement in an ANDA case is often difficult for innovator pharmaceutical companies.  Indeed, proof of inducement “requires evidence of culpable conduct, directed to encouraging another’s infringement.”  Such evidence may be found in the ANDA applicant’s proposed labeling, which might instruct physicians that the drug is indicated for a particular (patented) use.

Because a Section 8 statement potentially allows an ANDA filer to obtain approval of a generic drug without delay, it is of great interest to both innovator and generic companies.  In addition, physicians routinely prescribe generic drugs as a substitute for name brand medications, and some physicians will also prescribe such generics for off-label and patented methods of use.

While not intended to replace competent legal counsel, this concise little guide is intended for the busy executive to learn these subjects in understandable language so that you will be able to ask the right questions and understand the answers you receive. Broad in coverage, the book covers patent enforcement and infringement, pharmaceutical product life-cycle management, regulatory matters, and legislation related to pharmaceuticals with Take Home Messages at the end of each chapter summarizing the main points.

We highly recommend it.

About the Author

Martin A. Voet is a Senior Vice President and Chief Intellectual Property Counsel for Allergan.

The Generic Challenge: Understanding Patents, FDA and Pharmaceutical Life-Cycle Management (third edition) is available at Amazon.

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This morning, President Obama signed the America Invents Act at Thomas Jefferson High School for Science & Technology in Alexandria, Virginia—a school named for the first official to issue U.S. patents.  On stage with President Obama was a bipartisan group of legislators:  Sen. Patrick Leahy (D-VT); Rep. Lamar Smith (R-TX); Rep. Bob Goodlatte (R-VA); Rep. Jim Moran (D-VA); and Rep. Mel Watt (D-NC).

Have questions on the America Invents Act?

Today, US Chief Technology Officer Aneesh Chopra will be answering your questions with USPTO Director David Kappos during an Open for Questions event on Join them live at 5:00 p.m. EDT on Friday, September 16th. Here’s how it works and how you can participate:

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Author and inventor John D. Smith doesn’t want you to file a patent application.  Smith, author of the book “Don’t File a Patent!” book (232 pp.) writes:

“The patent process is an illusion of protection that takes inventors’ hard earned money and gives them nothing in return.”

So, why would I write about NOT filing patent applications if I’m a patent attorney?  Well, it’s certainly not because of the very unflattering description of patent lawyers offered up by Smith.  It’s that Smith makes some very valid points even if his anger and criticism are sometimes misdirected.

Here are his 10 reasons not to file a patent :

1. The Patent Office has a posted “patent allowance” average of 40%, but the true allowance ratio with some classes of products is as low as 5 to 16%.

2. The Office Action rejection process is a moneymaker for patent attorneys, but a money loser for the Inventor.

3. Patent Examiners do not have “obvious skill in the art” to determine the patentability of every type of invention.

4. In your Office Action rejection, the Patent Examiner will cite the illogical 35 U.S.C. 103(a) “obviousness” rejection clause, which makes no sense.

5. Filing a patent application wastes valuable capital that you should be using to develop and market your product.

6. The patent process takes approximately 3 to 6 years; your product could be obsolete by the time the patent issues.

7. A patent does not protect your product against a copycat; it just gives you the right to sue.

8. The Patent Office is a complicated bureaucracy with many problems that may never be fixed.

9. Patent maintenance fees are expensive and unreasonable.

10. The Patent Office may be showing favoritism towards big companies that, year after year, are awarded hundreds or thousands of patents.

As you can see, most of the list is devoted to Patent Office practices.  Are there some valid arguments for not filing a patent application? Sure, plenty of them.

  • Does the US Patent Office have a low percentage rate for patent allowance?  Fact.
  • Do examiners beat applicants over the head with 35 USC 103(a) obviousness rejections?  Like a rented mule.
  • Are patent maintenance fees expensive and unreasonable.  You betcha.

Mr. Smith seems to have had a very difficult and probably unnecessary, bad experience with the Patent Office.  But, saying never file a patent application is foolish advice without doing a more careful analysis.

For many innovations, like pharmaceuticals, consumer products, and many others, patent protection is great. In the United States , an inventor is granted the exclusive right to their invention for a period of 20 years from the date of filing the application. But, there are many times when patents are not worth the expense.

So, where do I stand on all this?  Consider these facts:

a.  Patents can be incredibly valuable and a critical asset to companies from start-ups to Fortune 500 sized blue chips.

b.  Patents can be a complete waste of time and money.

How do I reconcile these seemingly inconsistent statements?  To answer that you need a well thought-out business plan that addresses these three questions:

1.    How are you going to make your money?  Is it by licensing out the technology and collecting royalties?  Is it by making and selling a product directly?  Either way, how big of a market is there and how much can you realistically make from the invention?  Here, you need to look at some hard, very sane numbers and ask yourself if the risk/reward ratio makes protecting the idea worth the cost and effort.

2.  How long will you most likely need to protect your product?  Some products have a very short life cycle.  Given that filing and prosecuting a patent to issue can easily take 3-5 years, it would not make sense on a product that will be obsolete quickly.  On the other had, for some products — like pharmaceuticals — the most valuable years of the patent life are the last years.

3.  Can you police your invention in a practical manner?  That is, who is likely to infringe and can you sue them?  If your invention is one that takes place in the back of a shop and you can not detect the use from the product, you won’t be able to know if competitors are infringing.  If you can detect them, are they infringers you can collect from?  Generally, if the infringer is a private individual or small company, then they won’t have the money to pay anyway.  Likewise, if you don’;t have the money to sue and enforce the patent, perhaps the best course is to not file.

As Smith notes in his text, a patent merely gives you the right to keep others from using it.  More importantly, they are not self-enforcing, which means you have to enforce your rights yourself (read: sue).  You may want to consider if there are other types of intellectual property protections available for your product like copyright or trade secret.

Some advantages of trade secrets include:

  • Trade secret protection has the advantage of not being limited in time (patents last in general for up to 20 years from the date of filing). So, trade secret protection could continue indefinitely as long as the secret is not revealed to the public.

  • Trade secrets involve no registration costs (though there may be high costs related to keeping the information confidential).

  • Trade secrets have immediate effect.

  • Trade secret protection does not require compliance with formalities such as disclosure of the information to a Government authority.

Once you’ve made this analysis, then it becomes clear whether or not to file a patent application on your invention.  Regardless of the path you take, Smith’s book does have some helpful advice to an entrepreneur trying to get a product to market.  If you can get past his patent (and lawyer) bashing in the first half, his tips on how to manufacture and sell your invention yourself, which fill chapters 2-25, are really the useful part of the book.

I don’t begrudge Smith, though.  It is easy to understand his frustration.  There are a lot of difficulties in securing and enforcing a patent.  Unfortunately, Smith blames his patent attorney when most of the list of 10 reasons not to file have to do with patent office procedures that are not under the control of the attorney.  A good business plan (and good business advisers) could have saved him a lot of aggravation.

I even understand his sentiment when Smith opines that the word “attorney” may be Latin for “I need a bigger boat.”  Believe me, I think this same thought about my kids orthodontist every time I get a bill.  It’s easy to forget about all the capital expenditures, overhead and staffing expenses that are included in those bills and that the orthodontist doesn’t get to deposit that whole amount in his bank account.

It’s not about the hourly rate.  If you don’t have an attorney you feel confident is giving you the best advice for your business, you need to find another one.

Don’t File a Patent! Expanded Second Edition is available in paperback at Amazon as well as in paperback and PDF E-book format on Smith’s website,

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This is the third of a series of articles on IP and Antitrust issues. This article deals with some specific types of licensing restrictions. This is not an exhaustive list of practices that attract antitrust scrutiny. The licensing restrictions dealt with here are tying arrangements, tie-outs, royalty arrangements, exclusive dealings, cross-licensing, pooling and grant backs.

This blog installment deals with licensing restrictions. As mentioned in the previous post, IP is just one cog in the machine of production process and its value is truly enhanced only when combined with other factors. Frequently an IP owner will sell his rights in the IP to another, enter into a joint venture agreement with a view to further develop his IP, license or cross-license his IP so as to integrate his IP with that of another. Most of these arrangements seem innocuous but are apt to attract antitrust scrutiny if competition suffers harm or if the agreements are improperly drafted.

A “tying” or “tie-in” arrangement is defined as “an agreement by a party to sell one product… on the condition that the buyer also purchases a different (or tied) product, or at least that he will not purchased that [tied] product from any other supplier”. Eastman Kodak Co. v. Image Technical Services, Inc., 112 S. Ct. 2072, 2079 (1992)

Tying may manifest itself in the requirement that a licensee purchase a product or service from the licensor as a condition of receiving a license, or a requirement that a licensee take a license on additional intellectual property as a condition of receiving the license it is seeking. In the Kodak case, tying-in was achieved by Kodak implementing a policy of selling replacement parts for micrographic and copying machines only to buyers of Kodak equipment who use Kodak service or repair their own machines.

Tying-in attracts antitrust scrutiny where (1) it involves two separate products or services; (2) that are tied together; (3) the supplier possesses market power in the market for the tying product; (4) the tie has an anti-competitive effect in the tied market; and (5) the tie affects a substantial volume of commerce. See Jefferson Parish Hosp Dist. No. 2 v. Hyde, 466 U.S. 2 (1984) where the dispute was regarding whether every patient undergoing surgery at the hospital must use the services of one firm of anesthesiologists and if not, whether the contract is illegal because it unreasonably restrains competition among anesthesiologists.

Tying-in assumes different forms such as package licensing, technological tying or tie-outs. Package licensing is not necessarily unlawful if both parties willingly enter into it and there is no coercion. As always market power is considered a deciding factor in such cases.

In the recent Microsoft case, technological tying is an issue that comes to the forefront. Technological tying involves using product design to combine two potentially separate products into one. In Microsoft’s case the operating system and internet browser were sought to be combined. The Court held that Microsoft’s exclusion of Internet Explorer from the Add/Remove Programs utility constituted exclusionary conduct. United States v. Microsoft, 253 F.3d 34, 66-67

Tie-out is essentially akin to restriction clause or a covenant not to deal in competing technologies. Such arrangements are a misuse of intellectual property and can attract antitrust scrutiny. Other kinds of restrictive covenants such as fields of use, prospective or existing customers, territories of work, price of object sold, quantity manufactured or the outputs of the licensee are also liable to be considered antitrust in nature.

Exclusivity refers to the license and whether the licensor can license the product in question to more than one licensee. Exclusive licenses are not illegal per se. However, an exclusive arrangement may attract antitrust scrutiny if the licensees or the licensor and licensee are in a horizontal relationship. (See Part II in the series for horizontal relations).

Grant backs require the licensee to grant the licensor the right to any intellectual property developed by the licensee. Such a provision can attract antitrust concerns if it limits the licensee’s incentive to innovate. According to the ABA Section of Antitrust Law, Intellectual Property Misuse: Licensing and Litigation (4th ed. 1997) the consequences related to a grant back may be antitrust depending on a number of reasons such as:

(1) whether the grant back includes technology that goes beyond the originally licensed intellectual property;

(2) whether the grant back is in the form of an assignment, exclusive license, non-exclusive license or an option;

(3) whether the licensee retains any rights under the intellectual property subject to the grant back;

(4) the duration of the licensee’s grant back obligation;

(5) the parties’ market power;

(6) whether the parties are competitors;

(7) whether the grant back is royalty-free;

(8) the effect of the grant back on the parties’ incentive to innovate;

(9) whether the licensor can sublicense the intellectual property that is the subject of the grant back; and

(10) whether the grant back promotes dissemination of improvements developed by the licensee, increases the licensor’s incentive to license or otherwise increases competition and output in the relevant market.

Cross-licensing and patent pooling as such do not attract antitrust scrutiny. However, there are instances where such arrangements have unlawful anti-competitive effects:

(1)     where the arrangements include collective price or output restraints and do not contribute to an efficiency enhancing integration of economic activity;

(2)     where the patent pool is exclusive and (a) excluded firms cannot compete in the relevant goods or service market without access to the technology and (b) the pool participants collectively possess market power; and

(3)     where the pooling arrangement discourage or deters members from engaging in research and development (e.g. if the pooling arrangement includes mandatory grant back obligations, particularly at low royalty rates).  United States v. Krasnov, 143 F.Supp. 184

This concludes the series on IP and Antitrust issues. In conclusion, intellectual property and antitrust issues must be considered as a whole and not divest of one another. The purpose of IP laws is to provide incentives to future inventors and for dissemination and commercialization of new technology. The antitrust laws strive to achieve the same goal of promoting innovations and consumer welfare. In the end, of course, each case is unique and must be considered in light of its own facts and circumstances. The Agencies’ guidelines and the legislation in this area have to be applied to each case keeping the facts in mind. Ultimately however, the two areas of law must be seen as complementary in nature and not independent.

The next topic in this series deals with different types of licensing restrictions.

See part I here: Intellectual Property & Antitrust Issues: Market Power
See part II here: Intellectual Property & Antitrust Issues: Licensing Practices

Today’s post is by Guest Barista Shalini Menezes of D:ic.t:um.

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