Since the America Invents Act has now passed, a lot of applicants will now qualify for a 75% reduction in certain fees at the US Patent Office.  The Act created a new micro-entity rate.  Now, various fees are due according to the following schedule:

1.  Regular applicants:  You’re a big boy or girl and you pay full freight.  Enough said.

2.  Small Entity applicants:  you qualify for a 50% reduction in fees, same as before.

3.  Micro-Entity applicants (new):  you qualify for a 75% reduction in fees, a wholly new class.

Applicants will need to determine — for each and every application — if they qualify for micro-entity status or small entity status, as defined below.  The status of applications needs to be determined on a case-by-case basis — and on a continuing basis — since some applications may be licensed or otherwise encumbered such that it is not entitled to micro- or small-entity status.

So, here’s the starting point in the new law:


(a) Fee Setting-

(b) Small and Micro Entities- The fees set or adjusted under subsection (a) for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents shall be reduced by 50 percent with respect to the application of such fees to any small entity that qualifies for reduced fees under section 41(h)(1) of title 35, United States Code, and shall be reduced by 75 percent with respect to the application of such fees to any micro entity as defined in section 123 of that title (as added by subsection (g) of this section).

Now, to claim the correct status for any particular application, applicants will need to skim all over the U.S. Code to piece together all the necessary definitions.

In general, you need to see if your application falls into one of the two, reduced fee classes of micro- and small-entities.

Micro Entity Status

   Sec. 123. Micro entity defined

‘(a) In General- For purposes of this title, the term ‘micro entity’ means an applicant who makes a certification that the applicant–

‘(1) qualifies as a small entity, as defined in regulations issued by the Director;

‘(2) has not been named as an inventor on more than 4 previously filed patent applications, other than applications filed in another country, provisional applications under section 111(b), or international applications filed under the treaty defined in section 351(a) for which the basic national fee under section 41(a) was not paid;

‘(3) did not, in the calendar year preceding the calendar year in which the applicable fee is being paid, have a gross income, as defined in section 61(a) of the Internal Revenue Code of 1986, exceeding 3 times the median household income for that preceding calendar year, as most recently reported by the Bureau of the Census; and

‘(4) has not assigned, granted, or conveyed, and is not under an obligation by contract or law to assign, grant, or convey, a license or other ownership interest in the application concerned to an entity that, in the calendar year preceding the calendar year in which the applicable fee is being paid, had a gross income, as defined in section 61(a) of the Internal Revenue Code of 1986, exceeding 3 times the median household income for that preceding calendar year, as most recently reported by the Bureau of the Census.

‘(d) Institutions of Higher Education- For purposes of this section, a micro entity shall include an applicant who certifies that–

‘(1) the applicant’s employer, from which the applicant obtains the majority of the applicant’s income, is an institution of higher education as defined in section 101(a) of the Higher Education Act of 1965; or

‘(2) the applicant has assigned, granted, conveyed, or is under an obligation by contract or law, to assign, grant, or convey, a license or other ownership interest in the particular applications to such an institution of higher education.

Alas, you ask, what constitutes said Institutions of Higher Education?  For that, we have to turn to (20 U.S.C. 1001(a)):

   Institution of higher education

For purposes of this chapter, other than subchapter IV, the term “institution of higher education” means an educational institution in any State that –

(1) admits as regular students only persons having a certificate of graduation from a school providing secondary education, or the recognized equivalent of such a certificate;

(2) is legally authorized within such State to provide a program of education beyond secondary education;

(3) provides an educational program for which the institution awards a bachelor’s degree or provides not less than a 2-year program that is acceptable for full credit toward such a degree;

(4) is a public or other nonprofit institution; and

(5) is accredited by a nationally recognized accrediting agency or association, or if not so accredited, is an institution that has been granted pre-accreditation status by such an agency or association that has been recognized by the Secretary for the granting of pre-accreditation status, and the Secretary has determined that there is satisfactory assurance that the institution will meet the accreditation standards of such an agency or association within a reasonable time.

(b) Additional institutions included

For purposes of this chapter, other than subchapter IV, the term “institution of higher education” also includes –

(1) any school that provides not less than a 1-year program of training to prepare students for gainful employment in a recognized occupation and that meets the provision of paragraphs (1), (2), (4), and (5) of subsection (a) of this section; and

(2) a public or nonprofit private educational institution in any State that, in lieu of the requirement in subsection (a)(1) of this section, admits as regular students persons who are beyond the age of compulsory school attendance in the State in which the institution is located.

This last section (b) leaves a lot of questions.  Looking at paragraph (b)(1), it say “any school that provides not less than a 1-year program of training to prepare students for gainful employment in a recognized occupation.”

Seriously, if you include paragraph (b)(1), why have paragraph (a)(3)?  It’s like saying you have to be four feet tall but the definition also includes people that are three feet tall.

What institution is deemed a “school“?  I can’t find a legal definition although it usually refers to lower levels of study and not universities, colleges, or other institutions of higher education but it must meet the requirements of paragraphs (1), (2), (4), and (5) of subsection (a).  It must mean something different than “educational institution” used in paragraph (a) and paragraph (b)(2).

Would this include a hospital with a nursing program?  But the hospital itself is not a school.  What about a research institute that functions to provide part of a course curriculum for a college or university?

A karate school could be said to be legally authorized within such State to provide a program of education beyond secondary education and could by accredited by a nationally recognized accrediting agency or association (see Tsuki Bu-Do Kai Martial Arts Society International)

I can think of a lot of different kinds of schools:

  • vocational school
  • bible school
  • painting school
  • finishing school
  • home school
  • old school
  • school of hard knocks

You get the idea.

What are your thoughts?

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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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