I’ve now had a chance to review the bill that I reported yesterday. Here are my additional thoughts.
First-to-File v. First-Inventor-to-File
Many smaller inventors have been wary of the change from first-to-invent to first-to-file. Director Kappos addressed this concern in remarks last fall where he noted how few junior filers actually win interference proceedings. Since then, he has been suggesting that the US would not become a true first-to-file regime, but would instead institute a first-inventor-to-file system. Semantics, right? Well, maybe not.
The bill proposes not to eliminate interference proceedings entirely, but to replace them with derivation proceedings. These appear to be similar in scope to interference proceedings, but would be limited to instances where an inventor can prove that a prior patent applicant derived the invention from the true inventor. Thus, only the first true inventor to file would be entitled to a patent.
Third Party Patent Challenges
The bill permits two separate types of patent challenges by third parties: (1) post-grant review and (2) inter partes review. Post-grant review is limited to the first 9 months after a patent issues, while inter partes review is available for the life of the patent.
Neither type of proceeding may be filed if either the challenger has already filed a declaratory judgment action challenging the patent’s validity in court or more than 3 months after the challenger is required to respond to an allegation of infringement in a civil action, presumably by filing an answer or other responsive pleading.
The PTO is directed to permit the patent owner to file a response and then make a determination as to whether to institute the proceedings within 3 months of that response. The PTO is also directed to conclude the proceedings within 1 year of the determination of whether to institute the proceedings, which for good cause may be extended to 1 year and 6 months. During the first 4 years that these proceedings are available, the PTO may limit the number that can be filed each year.
The difference in the two proceedings seems to be the grounds that can be raised. For post-grant review, it appears that any ground can be raised, including failure to comply with any statutory provision such as §§ 101, 102, 103, or 112, and possibly inequitable conduct. Inter partes review remains limited to invalidity under §§ 102 and 103 by patents and printed publications.
Pending Applications
Third parties will now be permitted to submit patents and printed publications of relevance to pending applications provided the submission includes a description of the relevance of the submitted document. The submissions may only be made before the earlier of: (1) a notice of allowance, or (2) the later of 6 months from the publication of the application or a first office action on the merits.
Micro-Entities
The bill provides for a 75% discount on Patent Office fees for micro-entities. A micro-entity is defined in the bill rather narrowly. The inventors must have filed fewer than 5 prior patent applications, the application must be unassigned or assigned to an entity with 5 or fewer employees, and the inventor (if unassigned) or the assignee must have a gross income less than 2.5 times the average gross income from the prior year as reported by the Department of Labor.
Miscellaneous
The bill contains provisions that permit patent applications to be filed by the assignee rather than the inventor.
Interestingly, the bill does not contain any change to inequitable conduct law. The lack of such a provision was the reason that Judiciary Committee ranking member and bill co-sponsor Sen. Orrin Hatch (R-UT) voted against the bill in the Committee last year.
