| The Changes to the United States Prior Art Law | | | | defense of lack of infringement under the |
| Implemented by PL 108-453 Enacted December | | | | doctrine of equivalents, and the defendant wants |
| 10, 2004 | | | | the old 103 applied vis-a-vis its defense of |
| | | | invalidity and its defense of lack of infringement |
| I. Summary | | | | under the doctrine of equivalents? The patentee |
| II. Changes To 35 USC 103 | | | | meets the "any party in any action" criteria, as |
| III. Analysis | | | | does the defendant. The patentee meets the |
| IV. Impact On "action pending ... on the date of | | | | "rights" provision based upon its patent rights. |
| the enactment of this Act" | | | | Does the defendant's commercial activity infringing |
| V. Impact On Right to an Interference Proceeding | | | | the patent amount to a covered "right". In such |
| VI. Broadening Claims in Pending Applications | | | | actions, which version of 103 applies, and which |
| VII. Proactive Action and Agreements Relating to | | | | parties "rights" are superior? If Congress wanted |
| Applications Claiming Similar Subject Matter | | | | to ensure that the new law would be effective |
| VIII. Conclusion | | | | against patents in an ongoing patent litigation, it |
| I. Summary | | | | could have clearly so stated. The special provision |
| On November 20, 2004, the Congress passed S. | | | | on the effective date is not such a clear |
| 1292. President Bush signed S. 1292 into law as | | | | statement. |
| Public Law No: 108-453 (PL 108-453). This is a law | | | | This law was clearly partially in response to the |
| reducing the scope of prior art in the United | | | | judicial construction of 35 USC 102(g) expanding |
| States. The goal of the law is to remove certain | | | | the scope of prior art in Oddzon Products, Inc. v. |
| restrictions on patenting inventions resulting from | | | | Just Toys, Inc., 122 F.3d 1396 (Fed. Cir. |
| collaborative work between different people | | | | 1997)(Lourie, J.). However, merely because S. |
| employed by more than one legal entity. | | | | 1292, now PL 108-453, was in response to that |
| Specifically, PL 108-453 amends 35 USC 103(c) as | | | | situation does not mean that existing defendants |
| indicated below. | | | | in litigation should benefit from the prior version of |
| II. Changes To 35 USC 103 | | | | 35 USC 103 and its interpretation in Oddzon |
| The prior version of 35 USC 103(c) read as | | | | Products, Inc. |
| follows: | | | | The special provision generally would only harm |
| (c) Subject matter developed by another person, | | | | patent applicants, so patent applicants should |
| which qualifies as prior art only under one or more | | | | ignore it and promptly file 103(c)(2)(C) |
| of subsections (e), (f), and (g) of section 102 of | | | | amendments. There may however be an |
| this title, shall not preclude patentability under this | | | | exceedingly rare case where a patent applicant |
| section where the subject matter and the claimed | | | | would not want to file a 103(c)(2)(C) amendment |
| invention were, at the time the invention was | | | | because doing so would moot an interference |
| made, owned by the same person or subject to | | | | issue that the patent applicant wanted to resolve |
| an obligation of assignment to the same person. | | | | via an interference proceeding, as discussed |
| (Amended Nov. 8, 1984, Public Law 98-622, sec. | | | | below. |
| 103, 98 Stat. 3384; Nov. 1, 1995, Public Law | | | | V. Impact On Right to an Interference Proceeding |
| 104-41, sec.1, 109 Stat. 3511.) | | | | Keep in mind that the USPTO's position on |
| The new version of 35 USC 103(c) pursuant to | | | | interference proceedings is that their primary |
| PL 108-453 reads as follows: | | | | purpose is "to assist the examiner in the |
| (c)(1) Subject matter developed by another | | | | examination of a patent application." JD v. SH, |
| person, which qualifies as prior art only under one | | | | paper No.55, Interference 104,044, (Trial Section |
| or more of subsections (e), (f), and (g) of section | | | | of the BPAI, November 11, 1999). Therefore, |
| 102 of this title, shall not preclude patentability | | | | interference proceedings are only necessary when |
| under this section where the subject matter and | | | | the existence of a patent precludes the issuance |
| the claimed invention were, at the time the | | | | of a pending application. In this regard, note that a |
| claimed invention was made, owned by the same | | | | party whose application is rejected by a patent |
| person or subject to an obligation of assignment | | | | which it could remove from prior art by filing a |
| to the same person. | | | | 103(c)(2)(C) amendment, could remove the |
| (2) For purposes of this subsection, subject | | | | rejection by filing the103(c)(2)(C) amendment. |
| matter developed by another person and a | | | | That action will also likely preclude an interfere |
| claimed invention shall be deemed to have been | | | | proceeding with the patent, at least according to |
| owned by the same person or subject to an | | | | the reasoning in JD v. SH. However, there are |
| obligation of assignment to the same person if-- | | | | situations where the applicant desires to take |
| (A) the claimed invention was made by or on | | | | down the blocking patent instead of removing it |
| behalf of parties to a joint research agreement | | | | from prior art, in which situations the applicant |
| that was in effect on or before the date the | | | | should not file a the103(c)(2)(C) amendment. |
| claimed invention was made; | | | | With respect for the potential for an interference |
| (B) the claimed invention was made as a result of | | | | in situations were both parties to a joint research |
| activities undertaken within the scope of the joint | | | | agreement have filed in their applications and |
| research agreement; and | | | | patents 103(c)(2)(C) amendments, an interference |
| (C) the application for patent for the claimed | | | | is still possible. That is, the interference statutory |
| invention discloses or is amended to disclose the | | | | section, 35 USC 135(a), grants the USPTO |
| names of the parties to the joint research | | | | discretion when to declare interferences. |
| agreement. | | | | Moreover, 35 USC 135(a) provides an independent |
| (3) For purposes of paragraph (2), the term "joint | | | | basis for judgement against one party, specifically, |
| research agreement" means a written contract, | | | | lack of priority for a patentable invention, upon |
| grant, or cooperative agreement entered into by | | | | which to cancel that party's claims. Cf. "Viability of |
| two or more persons or entities for the | | | | the Hilmer Doctrine" Neifeld, 81 JPTOS 544, |
| performance of experimental, developmental, or | | | | section III.B (July 1999) (posted at ); and In re |
| research work in the field of the claimed invention. | | | | McKellin, 529 F.2d 1324, 1327, 188 USPQ 428, 432 |
| The effective date provision for PL 108-453 read | | | | (CCPA 1976)("An applicant who has lost an |
| as follows: | | | | interference is not entitled to claims which |
| SEC. 3. EFFECTIVE DATE. | | | | correspond to the subject matter of the counts |
| (a) IN GENERAL- The amendments made by this | | | | of the interference. A determination of priority of |
| Act shall apply to any patent granted on or after | | | | invention adverse to an applicant constitutes the |
| the date of the enactment of this Act [sic; on or | | | | final refusal by the Patent and Trademark Office |
| after December 10, 2004]. | | | | of the claims involved. 35 USC 135." Emphasis in |
| (b) SPECIAL RULE- The amendments made by | | | | the original.) Thus, it is possible that the USPTO |
| this Act shall not affect any final decision of a | | | | would declare an interference in a situation where |
| court or the United States Patent and Trademark | | | | neither party's inventive activities are prior art |
| Office rendered before the date of the | | | | against the other party. |
| enactment of this Act [sic; December 10, 2004], | | | | Moreover, the 103(c) exclusion from prior art |
| and shall not affect the right of any party in any | | | | applies only for non-anticipating prior art. That is, |
| action pending before the United States Patent | | | | the exclusion does not apply to a patent claim of |
| and Trademark Office or a court on the date of | | | | a first party to the joint research agreement if |
| the enactment of this Act [sic; December 10, | | | | the inventive activity of the second party to the |
| 2004] to have that party's rights determined on | | | | joint research agreement anticipates the subject |
| the basis of the provisions of title 35, United | | | | matter defined by the claim. Thus, it is still possible |
| States Code, in effect on the day before the | | | | for a 103(c)(2)(C) amendment to fail to remove |
| date of the enactment of this Act [sic; December | | | | the question of blocking prior art based upon |
| 10, 2004]. | | | | inventive activities of parties to a joint research |
| III. Analysis | | | | agreement. In such situations, the facts as to |
| Secret prior art refers to subject matter that is | | | | who first invented claimed subject matter may |
| prior art under U.S. law, but that is not publicly | | | | need to be determined via an interference, or if |
| disclosed. It includes subject matter meeting the | | | | the parties agree to cooperate, to a private |
| criteria of subsections (e), (f), and (g) of section | | | | investigation and submission of relevant prior art |
| 102. Those criteria are the filing of a patent | | | | admissions to the USPTO. |
| application, for 102(e), deriving the patentable | | | | In fact, how the USPTO will resolve the question |
| invention from another person, for 102(f), and | | | | of interference between patents and applications |
| prior secret invention by a third party, for 102(g). | | | | subject to 103(c)(2)(C) rights is an open legal |
| The version of 35 USC 103 in effect prior to | | | | question. Since this is an open legal question, and |
| December 10, 2004 excluded from the definition | | | | since 103(c) may still block allowance of desirable |
| of prior art non-anticipating secret prior art, so | | | | claims despite a joint research agreement, parties |
| long as the non-anticipating secret prior art was | | | | to such agreements might consider addressing |
| based upon activity by people subject by contract | | | | both the issue of interference and blocking 103(c) |
| to assign their inventions to the same legal entity | | | | prior art in their joint research agreements. When |
| as the named inventor. The revised statute | | | | might this situation arise? Consider for example a |
| expands the exclusion of subject matter from | | | | University attempting to derive revenue by |
| secret prior art to include any non-anticipating | | | | licensing a valuable technology when the corporate |
| subject matter meeting the following conditions. | | | | partner to its related joint research agreement |
| 1. A Pre-existing Agreement | | | | also patented that technology only to block its |
| The assignee of a claimed invention has in place | | | | commercial implementation in favor of an |
| prior to the date the claimed invention was made | | | | alternative technology. Consider for another |
| an agreement "for the performance of | | | | example a first party to a joint research |
| experimental, developmental, or research work in | | | | agreement that so broadly claim the results of |
| the field of the claimed invention" (that is, a joint | | | | the joint research that one claim is anticipated by |
| research agreement). | | | | the inventive work solely of inventors employed |
| Thus, a qualifying agreement that may impart | | | | by the other party, and the other party has for |
| immunity may have existed prior to the | | | | whatever reason failed to claim that subject |
| implementation of the legislation. | | | | matter. It is certainly far easier to address these |
| 2. A Result of Activities Within the Scope of the | | | | types of situations in advance when entering into |
| Agreement | | | | a joint research agreement than after they occur. |
| The "claimed invention was made as a result of | | | | VI. Broadening Claims in Pending Applications |
| activities undertaken within the scope of the joint | | | | Keep in mind that the change in the law covers |
| research agreement." | | | | pending applications if the foregoing conditions of |
| Thus, the agreement should broadly define the | | | | the joint research agreement existed when the |
| activities that are within "the scope of the joint | | | | inventions disclosed in the application were made. |
| research agreement." There will in certain | | | | If pending claims have scope limited to avoid |
| instances be competitive interests requiring the | | | | subject matter that at the time the application |
| parties to the agreement to draft the | | | | was filed was 103(c) prior art and which can now |
| agreements with narrow scope. In those types of | | | | be removed from 103(c) prior art by the filing of |
| situations, we can eventually expect litigation over | | | | a 103(c)(2)(C) amendment, consider filing a |
| whether the 103(c)(2) exclusion applies, and the | | | | 103(c)(2)(C) amendment and presenting suitably |
| decision in such litigation will construe the meaning | | | | broader claims. |
| of terms in the agreements against various fact | | | | VII. Proactive Action and Agreements Relating to |
| patterns. In any case, terms of such agreements | | | | Applications Claiming Similar Subject Matter |
| should be thought out carefully and fully defined in | | | | Another set of issues are raised by the change in |
| the agreement to minimize the chance of | | | | the law's impact on applications claiming similar |
| unexpected adverse consequences. | | | | subject matter filed by different parties to a joint |
| 3. The Application Discloses the Parties to the | | | | research agreement. The PTO specifiesthat the |
| Agreement | | | | duties of disclosure and candor extend to |
| The "application ... discloses or is amended to | | | | notifying the examiner when the applicant knows |
| disclose the names of the parties to the joint | | | | that similar claims are presented in different |
| research agreement." | | | | applications, so that the examiner can decide |
| Since this passage requires amendment of the | | | | whether to impose a double patenting rejection. |
| application, it is debatable whether it would apply | | | | The issues relate to both the duty of disclosure |
| to a certificate of correction to an issued patent. | | | | and double patenting. |
| The legislative history suggests that a post | | | | The duty of disclosure obviously extends to |
| issuance certificate of correction might be | | | | similar claims in applications owned by different |
| acceptable. However, that contradicts the actual | | | | parties, to the extent that each party knows |
| language of the statute. Thus, a party desiring this | | | | about the other parties applications. Accordingly, if |
| exclusion in an issued patent, particularly if litigation | | | | there is patent application information shared |
| is contemplated, might have to resort to filing an | | | | amongst parties to the agreement, the |
| application to reissue the patent, and then amend | | | | prosecuting patent attorney must be provided |
| the reissue application, to be certain the exclusion | | | | with that information to fulfill the 37 CFR 1.56 |
| applies. | | | | duties of disclosure and candor to the USPTO. |
| Moreover, it may be possible to file reissue | | | | Another issue is how entities should act to |
| applications for currently issued patents for | | | | minimize the potential for double patenting |
| purpose of adding a 103(c)(2)(C) amendment and | | | | rejection damage to their patent portfolios. |
| also to satisfy the requirement that the [reissue] | | | | For example, if each one of two entities to a joint |
| patent be issued after the December 10, 2004 | | | | research agreement files a patent application, and |
| effective date of PL 108-453. | | | | one or both of the applications are subject to |
| Generally, any party having such an agreement | | | | double patenting rejections over one another, how |
| should promptly file 103(c)(2)(C) amendments in | | | | should the two entities handle that situation? Note |
| the affected patent applications. Keep in mind that | | | | that there now exists no regulation allowing either |
| such an amendment could remove prior art that | | | | entity to remove the rejection by filing a terminal |
| might otherwise arise in discovery in litigation or | | | | disclaimer because the applications are not |
| due diligence against an issued patent. Accordingly, | | | | co-owned! 37 CFR 1.321(c)(3) requires common |
| it pays to file a 103(c)(2)(C) amendment | | | | ownership of both patents or applications for a |
| whenever the claimed invention arguably meets | | | | terminal disclaimer to be effective to remove a |
| the other requirements for the exclusion. | | | | double patenting rejection. Accordingly, the parties |
| IV. Impact On "action pending ... on the date of | | | | should contemplate now, actions to take, to avoid |
| the enactment of this Act" | | | | this problem. |
| PL 108-453 is effective for patents granted on or | | | | Such actions might include an agreement to assign |
| after December 10, 2004. However, there is a | | | | all patents rights to one of the two entities, or to |
| special provision respecting ongoing proceedings, | | | | assign only those patents in which proper double |
| which states that the change in 35 USC 103 "shall | | | | patenting rejections exist, to one entity, at a |
| not affect the right of any party in any action | | | | suitable time, with a suitable license back to the |
| pending before the United States Patent and | | | | assigning party. A more sensible action would be |
| Trademark Office or a court on the date of the | | | | to determine ahead of time whom to assign |
| enactment of this Act to have that party's rights | | | | patent applications (with suitable license back) and |
| determined on the basis of the provisions of title | | | | what each party will claim in the applications to |
| 35, United States Code, in effect on the day | | | | avoid or minimize the possibility of a double |
| before the date of the enactment of this Act." | | | | patenting rejection. Keep in mind that, even if the |
| There is a problem with that special provision. The | | | | patent applicant can defeat a double patenting |
| change in 103(c) can only help patentees, so | | | | rejection by filing a suitable terminal disclaimer, the |
| patentees would not want to have the older | | | | disclaimer may eliminate all potential patent term |
| version of 35 USC 103 apply. Thus, the special | | | | adjustment. That patent term truncation effect |
| effective date provision is not likely to be invoked | | | | will, generally speaking, be more detrimental the |
| by patentees. The term "rights" generally refers | | | | more basic the underlying research, since the |
| to property rights, like a patentee's exclusive | | | | more basic the underlying research, the further |
| rights. Accordingly, it is unclear to whom this | | | | out in time commercialization occurs. |
| provision should relate. | | | | VIII. Conclusion |
| Moreover, the statement "any party ... that | | | | PL 108-453 reduces the scope of prior art against |
| party's rights" suggests that this special provision | | | | qualifying claimed inventions. Legal entities can |
| can apply to both or all parties in an action. How | | | | take advantage of the benefits of PL 108-453 |
| will that provision be construed for example when | | | | with appropriate actions, and such entities may |
| a patentee litigant wants the new 103 applied | | | | want to promptly review the research related |
| vis-a-vis a defendant's defense of invalidity or | | | | agreements and take suitable action now. |