The Sky Is Not Falling: The Effects of Term Adjustment under the American Inventors Protection Act on Patent Prosecution

Mr. Slate's article considers the likely effects of the patent term adjustment provisions of the American Inventors Protection Act. Contrary to popular expectations, Mr. Slate argues that the Act's term adjustment provisions will have little practical effect on most practitioners' work. Cite as: 4 YALE SYMP. L. & TECH. 7 (2001) 111 The patent term adjustment provisions of the American Inventors Protection Act of 1999 (AIPA) have produced much terror among patent practitioners. The AIPA provides for a compensatory extension of patent term due to delays in the examination process. Such delays may result from a variety of events including the failure of the U.S. Patent and Trademark Office (PTO) to take certain actions within certain relative or absolute time periods. The AIPA, however, provides for a reduction in the term extension when the applicant fails to take certain actions within specified time periods, typically shorter than the applicable statutory or shortened statutory periods for taking such actions. Due, in all likelihood, to sloppy drafting, the AIPA provides such reduction even when the applicant's failure to act expeditiously contributed to neither a delay in patent issuance, nor the inability of the PTO to meet a deadline. 2 Many practitioners have expressed dismay at the practice implications of the AIPA's term adjustment provisions. Some assert that a need for compliance with the shorter time periods will significantly impact their practices. I disagree. In this note I argue that the term adjustment provisions of the AIPA are not revolutionary in presenting practitioners with considerations of how prosecution may affect patent term. Furthermore, the benefits of adherence to extension-friendly deadlines under the AIPA are largely speculative. t William Slate is an attorney and member of the Patent Practice Group at Wiggin & Dana, a law firm in New Haven, CT. 1 Slate: The Sky Is Not Falling Published by Yale Law School Legal Scholarship Repository, 2001 3 For the overwhelming majority of practitioners and applicants, the AIPA's term adjustment provisions will have little practical effect. The relationship between actions taken in patent prosecution and the resulting patent term is nothing new with the AIPA. Prior to the General Agreement on Tariffs and Trade (GATT), practitioners and applicants had significant ability to extend the patent term (seventeen years from issuance) by intentionally protracting prosecution. Nevertheless, very few pre-GATT practitioners routinely counseled clients on the ability to extend the patent term, either mildly or to the level of launching a so-called submarine patent. Furthermore, many post-GATT practitioners routinely fail to counsel their clients regarding what was and remains the only sure way to obtain a patent term extension: filing a provisional patent application and then waiting a full year to file a nonprovisional patent application with priority claim under 35 U.S.C. §119(e). 4 Term extension under the AIPA is speculative. When any action is taken, it is likely that it will not yet be known whether the application will be entitled to a term extension. Accordingly, speculative adherence to the strict extension-friendly deadlines may prove useful only in a small number of the cases in which it is practiced. In the remaining cases, the extraordinary efforts involved in adherence to the strict deadlines will produce no term extension benefit. Further underscoring this speculative nature, most U.S. patents are allowed to lapse for failure to pay a maintenance fee, thereby rendering the issue of term extension moot. 5 Nevertheless, in some situations even the speculative benefits of term extension may outweigh the costs of complying with the strict deadlines. This will be the case when an invention is anticipated to be in use twenty years in the future and the invention is of such a fundamental or landmark nature that it will not have been designed around by the end of the patent term. The invention of a new class of drugs is an example. However, in cases where patent term maximization is appropriate, such maximization does not merely involve expediting prosecution. As noted above, one key aspect of term maximization involves the use of provisional applications. If maximization of patent term extension under the AIPA is of paramount concern, the timing of actions is critical since taking some actions too promptly may cause a loss of term extension. For example, if a term extension results from an application pendency of more than three years, and if the applicant had responded to an Office Action in a prompt two weeks rather than the required three months, two-and-a-half months of extension would have been lost. Accordingly, maximization of term extension under 2 Yale Journal of Law and Technology, Vol. 3 [2001], Iss. 1, Art. 4 http://digitalcommons.law.yale.edu/yjolt/vol3/iss1/4 the AIPA may involve not simply meeting the strict deadlines, but just barely meeting the strict deadlines.