Source: https://www.patentdocs.org/2011/04/index.html
Timestamp: 2019-04-18 10:33:01+00:00

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The meeting can be attended in person at the USPTO's Auditorium in Madison East, 600 Dulany Street, Alexandria, VA, or viewed online here (select the "enter as guest" option). The Patent Office asks that non-USPTO employees login using their e-mail addresses. Additional information regarding the BCP customer partnership meeting can be found here.
In March, it appeared that patent reform leading to a unified European Union (EU) patent was on its way to being enacted, after the European Parliament pushed the latest European Commission proposal through despite a dissenting minority of member countries (see "European Parliament Approves Enhanced Cooperation Procedure to Create Unified EP Patent System"). However, this view appears to have been too optimistic, as the European Court of Justice has ruled that a separate patent court would violate European Union law by taking powers away from courts in EU countries. The Court of Justice is primarily concerned that the proposed patent court would not have sufficient checks and balances on its power.
The main selling point of the unified EU patent has been a reduction in costs. While the unified EU patent would decrease application costs, the unified patent court was proposed to reduce duplicative patent litigation costs and provide a forum of specialized patent judges. Unless the EU patent can be enforced by bringing just one suit, rather than separate suits throughout Europe, the benefit of the lower application costs may not be sufficient to warrant an overhaul of the current system. It is not clear whether some countries will cite the lack of a single court as a reason to back out of the unified patent plan, and whether some will see the application savings as reason enough to keep supporting it. However, without a clear patent enforcement mechanism, EU patent holders would have fewer assurances that their intellectual property is secure.
The European Court of Justice ruling can be satisfied if the Court of Justice receives appellate jurisdiction over the new proposed unified EU patent court. However, many are opposed to such a solution. The Court of Justice currently has the authority to rule on EU trademark issues, and has frustrated EU attorneys by providing inconsistent rulings over the years on simple matters of trademark law. The proposed patent court, separate from the Court of Justice, was an attempt to address that concern. Industry representatives have made it known that they would rather maintain the current system than evoke a system where patent questions go to the Court of Justice.
Despite the European Court of Justice ruling, the European Commission continues with its plan to create a unified EU patent, rolling out its latest proposal on April 13, noting that a unitary patent would still drastically reduce the cost of applying for patents. However, the Commission is now weighing new ideas that comport with the Court of Justice ruling and that would meet the goals of the reform. Most of the latest plans fail to put patent matters in front of a specialized patent court or do not solve the problem of disparate enforcement across EU countries.
On April 21, USPTO Director David Kappos sent a message to Patent Office employees, notifying them that "[t]he Track One expedited patent examination program, scheduled to go into effect on May 4, 2011, is postponed until further notice." Last Friday, the Intellectual Property Owners Association (IPO) made the text of that message available. Director Kappos also addressed the postponement of the Track One (or prioritized examination) program on his Director's Forum blog on Friday. Today, the USPTO issued a press release again announcing that the Track One program has been postponed. According to the release, the program, which was scheduled to go into effect on May 4, has been postponed "until further notice due to reduced spending authority in the Full-Year Continuing Appropriations Act, 2011." The Office noted that "[w]ithout the resources to hire a sufficient number of examiners to implement Track One, we must postpone the effective date of the program until we are in a position to implement it successfully while ensuring there will be no adverse impact on non-prioritized examination applications." The release states that a new start date for the program will be announced "as soon as circumstances permit," and that the Office will provide the new date "via a Federal Register notice."
Last week, USPTO Director David Kappos authorized an extension of the Patent Prosecution Highway (PPH) pilot program with the German Patent and Trade Mark Office (DPMA) that was begun on April 27, 2009 (see "USPTO Begins Pilot Program with the German Patent Office"). The PPH pilot permits an applicant having an application whose claims have been allowed in the DPMA to fast track the examination of an application in the USPTO, or vice versa, such that the latter application is examined out of turn. In particular, an applicant receiving a ruling from the USPTO (or the DPMA) that at least one claim in an application is patentable may request that the DPMA (or USPTO) fast track the examination of corresponding claims in the corresponding application in that office. According to a notice regarding the extension of the USPTO-DPMA PPH, both offices have agreed to continue the pilot program for an additional two years to April 26, 2013, at which time it will be determined whether and how the program should be fully implemented.
The USPTO has established PPH programs with fifteen Offices. Currently the USPTO has PPH programs (full or pilot) in place with the Japan Patent Office (JPO), the Korean Intellectual Property Office (KIPO), the United Kingdom Intellectual Property Office (UK IPO), the Canadian Intellectual Property Office (CIPO), IP Australia (IP AU), the European Patent Office (EPO), the Danish Patent and Trademark Office (DKPTO), the Intellectual Property Office of Singapore (IPOS), the German Patent and Trade Mark Office (DPMA), the National Board of Patents and Registration of Finland (NBPR), the Hungarian Patent Office (HPO), the Russian Federal Service for Intellectual Property, Patents and Trademarks (ROSPATENT), the Spanish Patent and Trademark Office (SPTO), the Austrian Patent Office (APO), and the Mexican Institute of Industrial Property (IMPI).
(see "USPTO Promulgates Guidelines for Applying 35 U.S.C. § 112, 2nd Paragraph").
Last week, Dow Jones VentureSource reported that investors put $6.4 billion of venture capital into 661 deals in the first quarter of 2011, which constituted a 35% increase in funding and a 5% increase in deals as compared with the same period last year. VentureSource noted that corporations provided $448 million of the $6.4 billion raised by venture-backed companies and were responsible for three of the ten largest deals of the first quarter.
In the healthcare sector, the VentureSource report indicated that while funding rose 21% to $1.6 billion, the number of deals dropped 6% to 148 in the first quarter of 2011 over the same period last year. Of the industries making up the healthcare sector, biopharmaceuticals collected 53% ($849 million) of healthcare funding and was responsible for 41% (61) of the sector's deals, which constituted a 15% increase in capital and a 13% drop in deals. The information technology sector matched the healthcare sector's $1.6 billion in funding in the first quarter.
Earlier this month, the National Venture Capital Association (NVCA) released its own report on venture funding, which indicated that $5.9 billion had been invested in 736 deals in the first quarter (see "NVCA Reports Modest Gains in First Quarter Venture Funding"). The NVCA report also noted that $1.4 billion had been invested in 164 first quarter deals in the Life Sciences sector (which like VentureSource's healthcare sector consists primarily of biotech and medical device companies).
On Friday, USPTO Director David Kappos addressed the impact of budgetary constraints on some of the Patent Office's plans for the coming year. He did so on his Director's Forum blog, where the Director (at right) noted that following enactment of the budget for FY 2011 on April 15, the Office's total spending authority through the end of the fiscal year (i.e., September 30, 2011) had "been limited to $2.09 billion." "Given this level of spending authority," he explained that the Office would "have to make significant reductions for the current fiscal year." Stating that the USPTO had "not come by these decisions lightly," and that he "recognize[d] that these measures will create new challenges for our ability to carry out our agency’s mission," Director Kappos listed a number of USPTO initiatives and policies that would be postponed, suspended, or reduced "[e]ffective immediately and until further notice."
As we noted last week, one of the programs that will be postponed is the Track 1 (or prioritized examination) portion of the Enhanced Examination Timing Control Initiative (see "USPTO News Briefs," April 21, 2011). The opening of the USPTO satellite office in Detroit is also being postponed, "as well as consideration of other possible satellite office locations." Office personnel will certainly feel the impact of the FY 2011 budget, with all hiring being frozen, employee training being reduced, all overtime being suspended, and "all other non-compensation-related expenses, including travel, conferences and contracts" being reduced. In addition, the Director noted that IT projects will be "scaled back," and that funding for Patent Cooperation Treaty (PCT) outsourcing will be "substantially reduced."
The Director's post was preceded by a somewhat more detailed e-mail message the Director sent to USPTO employees. The Intellectual Property Owners Association (IPO) made the text of that message available on Friday. In the e-mail, the Director notes that the Office's $2.09 billion spending limit means that the Office "will be unable to expend the additional $85-100 million in fees that we will be collecting during this fiscal year -- funds that we had anticipated being able to use to fund operations this year."
It appears that only patent operations are to be affected, as the trademark side of the Office will be "unaffected and will maintain normal operations."
In view of the budget problems highlighted in the Director's e-mail and blog post, it certainly is a case of what a difference a week -- or in this case two weeks -- makes. On the heels of the December 2010 announcement of the Detroit satellite office (see "USPTO News Briefs," December 21, 2010), and the Office's indication that it was looking at other locations for satellite offices (as well as provisions in the America Invents Act that would provide for the establishment of three or more satellite offices; see "'Reform' at the U.S. Patent and Trademark Office"), several groups had begun lobbying for satellite offices in their "backyards." On April 6, the Austin American-Statesman reported that House Judiciary Chairman Lamar Smith (R-TX) and Reps. Lloyd Doggett (D-TX), John Carter (R-TX), and Michael McCaul (R-TX) had written to Secretary of Commerce Gary Locke and Director Kappos formally asking them to consider Austin for a regional office. The article noted that Silicon Valley had also begun a lobbying effort to secure a satellite office, and that Denver and Atlanta were considered to be contenders. A Law360 article (subscription required) on April 14 noted that the Silicon Valley effort was in full swing, with Director Kappos meeting with IP insiders in a town hall event to discuss plans for modernizing the Patent Office. The USPTO has posted a draft of the Director's address on its website. While the draft does not mention satellite offices, the Law360 report notes that attendees indicated that the Director had said that Silicon Valley met several of the Office's key considerations. However, with the spending limits imposed on he Office by the FY 2011 budget, satellite office lobbying -- like satellite office consideration -- is now on hold.
The Intellectual Property Law Association of Chicago (IPLAC) Biotech Committee and the John Marshall Law School Center for Intellectual Property Law will offer a panel discussion entitled: "Gene Patents . . . Statutory Subject Matter?" on April 28, 2011 from 1:00 to 2:30 PM (CDT) at the John Marshall Law School in Chicago, IL. The panel discussion will focus on the Association for Molecular Pathology v. U.S. Patent and Trademark Office case, which was argued before the Federal Circuit on April 4, 2011. Panelists will include Dr. Hans Sauer, Associate General Counsel for Intellectual Property for the Biotechnology Industry Organization (BIO) and Adjunct Professor of Law at the Georgetown University Law Center; Joshua D. Sarnoff, Associate Professor of Law at the DePaul University College of Law; Patent Docs author Dr. Kevin E. Noonan, Partner with McDonnell Boehnen Hulbert & Berghoff LLP and Adjunct Professor at the DePaul University College of Law and The John Marshall Law School; and Kevin Collins, Professor of Law at the Washington University School of Law.
Patent Docs readers may recall that Dr. Sauer and Prof. Sarnoff participated in a public radio discussion of the AMP v. USPTO case back in June 2009 (see "Gene Patenting Debate Continues"). Dr. Sauer was also of counsel on BIO's amicus brief in support of reversal (see "BIO and AUTM File Joint Amicus Brief in AMP v. USPTO"). Prof. Sarnoff, meanwhile, authored an amicus brief on behalf of the American Medical Association et al. in support of plaintiffs-appellees and affirmance. Dr. Noonan co-authored an amicus brief for the Intellectual Property Owners Association (IPO) (see "IPO Files Amicus Brief in AMP v. USPTO"), appeared on "60 Minutes" in April 2010 to discuss the AMP v. USPTO case (see "'60 Minutes' and 'Newshour' Take Different Approaches to Covering Gene Patenting Story"), and has written extensively on gene patenting and the AMP v. USPTO case in this space. Prof. Collins has written and presented on diagnostic method claims (see "Patenting Information").
The registration fee for the panel discussion is $10 (students), $20 (IPLAC members), or $30 (non-IPLAC members). IPLAC is an Accredited CLE Provider, and it is anticipated that the program will be eligible for 1.5 hours of CLE credit. In addition, Patent Docs will be providing lunch for attendees. Those interested in registering for the panel discussion should contact Paul Reinfelds at PREI@Lundbeck.com or Donald Zuhn at zuhn@mbhb.com to reserve a spot.
Earlier this month, Pozen obtained a preliminary injunction blocking Par Pharmaceutical from marketing a generic version of Pozen's migraine drug Treximet until an infringement suit over the drug is resolved. The dispute between the parties began in November 2008 when Pozen brought suit in the U.S. District Court for the Eastern District of Texas against Par and the generic drugmakers Alphapharm, Teva, and Dr. Reddy's (see "Court Report," November 23, 2008). All four defendants had submitted ANDAs seeking to market generic versions of Treximet. Pozen claimed that the generic drugmakers infringed U.S. Patent Nos. 6,060,499; 6,586,458; and 7,332,183. In April 2010, Teva was dismissed without prejudice from the consolidated litigation. The case against the other three defendants was tried on October 12-15, 2010, and a decision is still pending. However, in early 2011, Par received approval from the FDA to market its generic version of Treximet, allowing Par to launch its product once Pozen's three years of regulatory exclusivity expires on April 15. After Par refused to reveal whether it planned to launch at-risk, Pozen then asked the court for a preliminary injunction until the court issues a final decision.
In an April 14 opinion, Judge Leonard Davis granted a preliminary injunction ordering Par not to make, use, sell, offer to sell, or import into the United States a generic version of sumatriptan and naproxen sodium. Judge Davis focused his analysis on two asserted claims of the '458 patent, finding that Pozen had sufficiently shown that it was likely to succeed against Par on the merits of its infringement claim. The court also rejected Par's arguments that it raised a substantial question regarding the enforceability of the '458 patent. The injunction will remain in effect until a final decision is issued in the pending patent litigation.
Wyeth has entered into a licensing deal with Orchid Chemicals & Pharmaceuticals, thereby ending the parties' patent infringement litigation over Effexor XR. The dispute between Wyeth and Orchid began in July 2009, when Wyeth filed suit in the U.S. District Court for the District of New Jersey against Orchid after its submission of an ANDA for a generic extended release version of venlafaxine HCl (see "Court Report," July 12, 2009). Wyeth asked the court to declare that Orchid had infringed U.S. Patent Nos. 6,274,171; 6,403,120; and 6,419,958 and enjoin the generic drugmaker from making or selling its proposed generic. Orchid responded by asserting that that patents were invalid. In October, Wyeth was ordered to produce its prior Effexor patent settlement and licensing agreements after the court decided the agreements might be relevant to Orchid's patent misuse defense. Wyeth has filed at least sixteen suits over Effexor XR since the drug was approved, and has settled with eleven generic companies to date.
On April 14, Judge Freda L. Wolfson signed an order approving the settlement. Under the settlement, Orchid agreed not to manufacture its generic product until the expiration of the three patents at issue, except as permitted by a confidential licensing agreement. The settlement requires each party to bear its own court costs. Further details of the agreement were not revealed.
After filing its complaint just one month ago, Takeda Pharmaceutical has requested a voluntary dismissal of its patent infringement suit against Apotex, centered around Apotex's efforts to manufacture a generic version of the diabetes medication Actos. On March 22, Takeda brought suit against Apotex in the U.S. District Court for the Southern District of Florida, claiming that Apotex's ANDA infringed U.S. Patent Nos. 5,965,584; 6,329,404; 6,166,043; 6,172,090; 6,211,205; 6,271,243; and 6,303,640 (see "Court Report," March 27, 2011) Apotex sought approval for generic pioglitazone tablets to be used for both monotherapy and in combination with a diabetes drug. Takeda also alleged willfull infringement and inducing infringement, claiming Apotex was likely to advertise the Actos name on its website, thus inviting customers to follow the Actos treatment systems but substitute the Apotex version of the drug.
On April 13, Judge Ursula Ungaro entered an order dismissing the case without prejudice, based on Takeda's request and notice of voluntary dismissal. Takeda did not disclose its reasoning for requesting dismissal, but both parties are currently litigating a nearly identical infringement suit in the U.S. District Court for the Southern District of New York.
Genentech, Inc. et al. v. Glaxo Group Ltd. et al.
• Defendants: Glaxo Group Ltd.; GlaxoSmithKline LLC; Human Genome Sciences, Inc.; Lonza Biologics PLC; Lonza Biologics Inc.
Infringement of U.S. Patent No. 7,923,221 ("Methods of Making Antibody Heavy and Light Chains Having Specificity for a Desired Antigen," issued April 12, 2011) based on defendants' manufacture and sale of their Benlysta® (belimumab, under development for the treatment of seropositive patients with systemic lupus erythematosus) and Arzerra (ofatumumab, used to treat chronic lymphocytic leukemia) products. View the complaint here.
Nautilus Neurosciences, Inc. et al. v. Wockhardt USA LLC et al.
• Defendants: Wockhardt USA LLC; Wockhardt Ltd.
Infringement of U.S. Patent Nos. 6,974,595 ("Pharmaceutical Compositions Based on Diclofenac," issued December 13, 2005), 7,482,377 ("Pharmaceutical Compositions and Methods of Treatment Based on Diclofenac," issued January 27, 2009), and 7,759,394 ("Diclofenac Formulations and Methods of Use," issued July 10, 2010) following a Paragraph IV certification as part of Wockhardt's filing of an ANDA to manufacture a generic version of Nautilus' Cambia® (diclofenac potassium, used for the acute treatment of migraine attacks). View the complaint here.
Purdue Pharma L.P. et al. v. Ranbaxy Inc. et al.
• Defendants: Ranbaxy Inc.; Ranbaxy Pharmaceuticals Inc.; Ranbaxy Laboratories Ltd.
Infringement of U.S. Patent Nos. 7,674,799 ("Oxycodone Hydrochloride Having Less Than 25 PPM 14-Hydroxycodeinone," issued March 9, 2010), 7,674,800 (same title, issued March 9, 2010), and 7,683,072 (same title, issued March 23, 2010) following a Paragraph IV certification as part of Raxbaxy's filing of an ANDA to manufacture a generic version of Purdue Pharma's OxyContin® (controlled release oxycodone hydrochloride, used to treat pain). View the complaint here.
• Defendants: Impax Laboratories, Inc.
Infringement of U.S. Patent Nos. 6,488,963 ("Hot-Melt Extrudable Pharmaceutical Formulation," issued December 3, 2002), 7,674,799 ("Oxycodone Hydrochloride Having Less Than 25 PPM 14-Hydroxycodeinone," issued March 9, 2010), 7,674,800 (same title, issued March 9, 2010), 7,683,072 (same title, issued March 23, 2010), and 7,776,314 ("Abuse-Proofed Dosage System," issued August 17, 2010) following a Paragraph IV certification as part of Impax's filing of an ANDA to manufacture a generic version of Purdue Pharma's OxyContin® (controlled release oxycodone hydrochloride, used to treat pain). View the complaint here.
Takeda Pharmaceutical Co., Ltd. et al. v. Impax Laboratories, Inc.
• Plaintiffs: Takeda Pharmaceutical Co., Ltd.; Takeda Pharmaceuticals North America, Inc.; Takeda Pharmaceuticals LLC; Takeda Pharmaceuticals America, Inc.
• Defendant: Impax Laboratories, Inc.
Infringement of U.S. Patent Nos. 6,462,058 ("Benzimidazole Compound Crystal," issued October 8, 2002), 6,664,276 (same title, issued December 16, 2003), 6,939,971 (same title, issued September 6, 2005), 7,285,668 ("Process for the Crystallization of (R)- or (S)-Lansoprazole," issued October 23, 2007), and 7,790,755 ("Controlled Release Preparation," issued September 7, 2010) following a Paragraph IV certification as part of Impax's filing of an ANDA to manufacture a generic version of Takeda's Dexilant® (dexlansoprazole, used for the treatment of all grades of erosive esophagitis, maintaining healing of esophagitis, and treating heartburn associated with symptomatic non-erosive gastroesophageal reflux disease). View the complaint here.
Celgene Corp. et al. v. Mylan Pharmaceuticals Inc.
• Defendant: Mylan Pharmaceuticals Inc.
Infringement of U.S. Patent Nos. 5,908,850 ("Method of Treating Attention Deficit Disorders with d-Threo Methylphenidate," issued June 1, 1999), 6,355,656 ("Phenidate Drug Formulations Having Diminished Abuse Potential," issued March 12, 2002, with a reexamination certificate issued March 27, 2007), 6,528,530 ("Phenidate Drug Formulations Having Diminished Abuse Potential," issued March 4, 2003), 5,837,284 ("Delivery of Multiple Doses of Medications," issued November 17, 1998), 6,635,284 (same title, issued October 21, 2003), and 7,431,944 ("Delivery of Multiple Doses of Medications," issued October 7, 2008) all licensed exclusively to Novartis in certain fields of use, following a Paragraph IV certification as part of Mylan's filing of an ANDA to manufacture a generic version of Novartis' Focalin XR® (extended release dexmethylphenidate hydrochloride, used to treat attention deficit hyperactivity disorder). View the complaint here.
As Nelson Mandela wisely said: "A good head and a good heart are always a formidable combination." IP specialists and creators are among the brightest people in commerce, and we all know innovation is the key to international development. With this spirit, the South African Department of Science and Technology and its co-sponsors encourage you to attend a conference on "Accelerating Intellectual Property and Innovation in South Africa," to be held on September 18-20, 2011 in Cape Town, at the Cape Sun Hotel. This conference is an opportunity for patent and innovation specialists internationally to share best practices with their peers in South Africa, in a forum designed to create networking and future business opportunities with the goal to expand South Africa's growing domestic capability.
This conference also provides the opportunity to celebrate a huge accomplishment by South Africa, which recently became the first developing country in the world to pass transformational legislation allowing publicly funded universities and scientific research councils to own the IP they generate and to commercialize it for the benefit of the country and the world. The newly promulgated "Intellectual Property Rights from Publicly Financed Research and Development Act" (51 of 2008) also establishes a new office to administer the legislation, the National IP Management Office ("NIPMO"). The U.S. Bayh Dole Act fundamentally changed the landscape of the biotechnology industry in the U.S. South Africa has now designed its own unique path to create and grow innovator companies, becoming an inspiring model for other developing countries.
The lead sponsor of the event is the South African Department of Science and Technology. The Co-Organizing Chairs of the event are Sherry Knowles, Knowles Intellectual Property Strategies, Atlanta GA (former Chief Patent Counsel, GlaxoSmithKline) and McLean Sibanda, Chief Executive Officer, The Innovation Hub, Pretoria ZA (instrumental in drafting and facilitating the new IPR legislation).
• Roy F. Waldron, Chief IP Counsel, Pfizer Corp.
• Anthony E. Lockett, M.D., Medical Director and Regulatory Consultant, Information Change Ltd.
The panel on entrepreneurial approaches to IP creation will include Professor Dennis C. Liotta, the Samuel Chandler Dobbs Professor of Chemistry at Emory University, co-inventor of HIV drug Emtricitabine which is a key component of Gilead's HIV drugs Truvada and Atripla, and co-founder of iThemba Pharmaceuticals, a drug discovery company in South Africa focused on developing drugs for neglected tropical diseases; and Dr. Frank Litvack, a prominent interventional cardiologist, former Co-Director of the Interventional Cardiology Center at Cedars Sinai Medical Center in Los Angeles, Professor of Cardiology at UCLA School of Medicine, and successful serial entrepreneur of medical device and pharmaceutical companies.
A Welcome Reception will be held Sunday evening, September 18. The conference dinner Tuesday September 20 will serve as the formal introduction of South Africa's new legislation and implementing agency by the Department of Science and Technology. It will also give participants and attendees the opportunity to commend the country for this impressive step to expand a domestic innovator industry which is capable of contributing to African and global advancement.
The website for registration will open May 2, 2011. Please contact JudyLane Consulting (London), the conference organizers, with any inquiries (annie@judylaneconsulting.com or dawn@judylaneconsulting.com) or Ms. Nomkhosi Madwe, Director: Operations and Special Projects: National Intellectual Property Management Office, Department of Science and Technology, South Africa (Nomkhosi.madwe@dst.gov.za).
Patent Resources Group (PRG) and Management Forum will be offering two one-day courses on the European Patent system on June 2-3, 2011 at the McDonnell Boehnen Hulbert & Berghoff LLP conference center in Chicago, IL.
Additional information regarding each course can be found here (June 2) and here (June 3). A brochure for the courses, including an agenda and registration form can be downloaded here. The registration fee for each course is $995 (or $1,795 for both courses). Those interested in registering for the event, can do so here.
• Patent Reform -- Judge Zhipei Jiang, Professor of Law, Chief Justice of IPR Tribunal, Supreme People's Court of the People's Republic of China (Retired); Alastair Payne, Matheson Ormsby Prentice, Ireland; and Herbert C. Wamsley, Intellectual Property Owners Association, United States.
A complete brochure for the meeting, including an agenda, list of speakers, and registration form can be downloaded here. The registration fee for the conference is $1,475. Those interested in registering for the meeting can do so here.
Earlier this month, the U.S. Patent and Trademark Office announced that it would begin accepting requests for prioritized examination of patent applications (i.e., the Track 1 portion of the Enhanced Examination Timing Control Initiative outlined in a Federal Register notice in June 2010) on May 4, 2011 (see "USPTO to Launch Prioritized Examination on May 4th"). Today, Hal Wegner reported in his e-mail newsletter that USPTO Director David Kappos sent a message to USPTO employees this afternoon, notifying them that "[t]he Track One expedited patent examination program, scheduled to go into effect on May 4, 2011, is postponed until further notice." According to Mr. Wegner's e-mail, "[t]he cancellation is due to budgetary cuts; whether and when prioritized examination may be reinstated is unclear."
On April 5, the U.S. Patent and Trademark Office announced that the U.S. and United Kingdom had made progress on a joint action plan launched in March 2010 "to combat the problem of patent backlogs and their effects on the economy and job creation." The joint action plan is based in part on a study commissioned by the UK Intellectual Property Office (UKIPO), entitled "Economic Study on Patent Backlogs and a System of Mutual Recognition," which examined the economic impact of delays in processing patents, and which found that patent office delays stifle innovative competitiveness, drag down R&D investments, and minimize incentives to create, especially for inventions in the hi-tech sectors. According to the USPTO press release, the joint action plan "allow[s] a patent examiner in one office to reuse work done by an examiner in the other office on a corresponding application to the maximum extent possible in order to reduce duplication of work, speed up processing and improve quality in both offices." The plan has thus far resulted in IT system enhancements that have provided USPTO and UKIPO examiners with better electronic access to search and examination reports prepared in each office and the development of resource manuals and instruction handbooks to enhance common understanding of practice in each office.
March 2, 2011 Declared "Federal Holiday"
In a notice issued on March 30, the U.S. Patent and Trademark Office indicated that its customer service window in the Randolph Building in Alexandria, VA was unexpectedly closed at 11:00 pm on March 2, 2011 due to a power outage. In light of the window's closing, the Office announced that it "will consider Wednesday, March 2, 2011, to be a 'Federal holiday within the District of Columbia' under 35 U.S.C. § 21 and 37 C.F.R. §§ 1.6, 1.7, 1.9, 2.2(d), 2.195 and 2.196." As a result, "[a]ny action or fee due on Wednesday, March 2, 2011, will be considered as timely for the purposes of, e.g., 15 U.S.C. §§ 1051(b), 1058, 1059, 1062(h), 1063, 1064, and 1126(d), or 35 U.S.C. §§ 119, 120, 133 and 151, if the action was taken, or the fee paid, on the next succeeding business day on which the USPTO was open, that is, Thursday, March 3, 2011 (37 C.F.R. $5 1.7(a) and 2.196)." Good news for anyone who may have missed a March 2, 2011 deadline by a day.
I need your immediate assistance to help defeat a particularly bad patent bill now in its final stages of consideration by the U.S. Congress. Congress may well be on the verge of passing a great threat to our patent system. You have seen the blogs and emails explaining how the America Invents Act (formerly the Patent Reform Act of 2011) will dismantle our carefully-balanced patent system, the system that has made America the innovation engine for the world. Other countries innovate at half our rate. The multinationals want to "harmonize" our laws with those unsuccessful systems for their own convenience. This bill imposes about $1 billion in costs by taking away options that domestic American businesses use, to save a comparatively trivial amount for the Patent Office and a small number of multinational corporations.
Because this bill has passed the full Senate and the House Judiciary Committee, it could be enacted within weeks. The big multinational corporations have plowed untold sums of money into lobbying, and have the bill they want. It's essential that Congress hear from domestic American businesses and inventors, and hear from them now. Congress desperately needs to learn from small businesses and startups how they actually use the patent system to create new products, jobs, and wealth.
Congress is on recess during the next two weeks, April 18 to May 2, and your Representative will be in your district. This period is your best opportunity to inform your Representative that this bill will destroy American jobs by making it impossible for startups, small companies, and university spinoffs to protect the inventions they create, to obtain the funding they need to commercialize their inventions, and to earn the profits they need to grow new R&D-intensive businesses.
Go to www.house.gov to find your Representative's contact info. To schedule a meeting, many offices will want you to FAX in a request letter. Second best is a phone call to your district office (not the D.C. office). Third best -- and far less effective, but better than nothing -- is an email. www.reformaia.org can help you with some of these contacts.
Ask your clients to join you at a meeting, or at a minimum, to call or write. This letter is accompanied by a "script" you can give to clients for them to make their calls.
• Your representatives should support an amendment to strike the "first-inventor-to-file" section. This section removes any practical grace period, and will destroy future jobs: Also, it is likely unconstitutional, and the legal uncertainty will be unacceptable to businesses.
• If the "first-inventor-to-file" provision is not struck, urge your representative to vote against the entire bill, regardless of any other changes that might be incorporated.
If you live in Ohio, call Governor Kasich's office, (614) 466-3555. Point out that the governor's $700 million Ohio Third Frontier jobs program cannot work, and that the Innovation Ohio Loan Fund will be not be repaid, if the federal Patent Act is changed to deter investment in university spin-offs and startups, and to make it harder for new businesses to succeed.
Please take the opportunity to meet or phone, or at least email your Representative. (A phone call has several times the weight of an email, and a meeting will have many times the impact of a phone call). You will be more likely to get a personal meeting, and you will have far more impact, if you as an attorney bring one or two of your clients with you. Stay away from patent jargon, because the person you talk to will almost certainly know nothing about patent law. It's crucial that you discuss the effects of the bill in terms of destruction of innovation, jobs, start-up businesses, and the like, issues that a Representative or staffer can relate to. Urge your clients to join you for a meeting.
It's crucial to act now. Please help preserve our gold standard patent system, one of the biggest engines of job growth in the U.S., and part of the reason U.S. attorneys can create so much more value for their clients than other attorneys.
• The § 102(a) grace period is totally repealed. Every inventor will be in a race against all other possible disclosures -- no inventor will have the time to perfect and test an invention before filing. All companies will be forced to file before an invention is fully understood or tested. That will be expense for your clients and trouble for you as an attorney, and reduce patent quality.
• Inventors, entrepreneurs, and startups use the grace period of § 102(a) to meet with investors, do the trial-and-error of R&D, and test their inventions. Under today's law, the implied obligations of confidentiality in conversations with investors and early-stage partners give sufficient protection to permit these ordinary business activities. The bill repeals all these protections, and replaces them with a flimsy grace period that creates unacceptable risk of loss of patent rights, that no business can rely on -- though adds strong protections for large companies that can raise all their financing, and do all their manufacturing and testing in-house. Inventors won't be able to talk to investors without a patent, and won't be able to file an application without an investor.
• The bill states that an inventor can recover patent rights if he can prove that all other disclosures originated with the inventor -- but the bill neglects to create a procedural forum for showing derivation in cases where the leak is not embodied in a patent application, or where the leak neglects to attribute the original inventor. As a practical business matter, the bill leaves no commercially-feasible grace period, an integral part of U.S. patent law since 1839 -- you will have to file every application as soon as possible, often long before the invention is ready.
• The bill provides that all disclosures within and by a single company do not create bars. This is great for multinational companies, with large in-house staffs, but totally useless for a startup or small company that has to partner with outsiders. Startups use and need the options and protections of current law, but the new bill cuts them away.
• A single offer for sale or public demonstration one day before filing a patent application will irretrievably destroy patent rights, if the poorly-drafted language is interpreted literally.
• The § 102(b) grace period is cut back -- it no longer protects against activities by third parties, but only the inventor's own activities.
• As a patent attorney, you will no longer have time to do a good job preparing a patent application, you'll be "forced to file" prematurely. This will expose you to risks and destroy your weekends. Poor initial applications will drive up post-filing prosecution costs. You will find yourself as the blocking point for many of your clients' business activities, harming your client relationships.
• Various statutory requirements that an applicant act "without deceptive intention" are repealed -- in the future, applicants will have incentive to act with deceptive intent.
• Key terms of art are redefined -- you've spent a career learning the meaning of "on sale" and "public use," but the legislative history fundamentally redefines these terms. It will take decades for courts to establish new precedent to provide any meaningful commercial certainty.
• The Metallizing Engineering "secret commercial use" bar is repealed -- a company will be able to use an invention as a trade secret, and then spring a patent on the public years later. That favors market incumbents, but makes innovation harder for everyone else.
• The "best mode" requirement is reduced to a sham: a patentee will be permitted to disclose only a fictitious embodiment, while holding the best as a trade secret.
• Several aspects of the "first-inventor-to-file" provision -- the ones that give patents to second inventors, and to companies that kept inventions in secret for years before filing patent applications -- violate constitutional limits on Congress' authority -- years more litigation and commercial uncertainty.
• The Act allows Wall Street banks to attack "business method" patents that they are infringing. This doesn't extend to any other industry, only business methods -- another Wall Street giveaway.
The bill is out of committee -- further amendments are unlikely. It is literally impossible to alter the bill to meet the needs of startups through an amendment strategy at this late date. The multinationals and their congressional allies smell victory. They see no reason to allow any weakening of their preferred bill through amendments favoring small businesses. The only option at this point is to vote it down.
Typical inventor activities that no longer "work"
• An entrepreneur with nothing but an idea typically has to present his idea to dozens of venture capitalists and potential manufacturing or marketing partners, without formal confidentiality agreements, to get a company started. (VC's never sign confidentiality agreements for first meetings.) This works under today's law, because of the implied obligation of confidentiality and the protection of § 102(a), but under the bill, these conversations will create commercially-unacceptable risks to the investor and partner. U.S. inventors will be under the same "Catch-22" as European inventors -- unable to talk to potential investors until a patent application is filed, but unable to file a patent application without an investor. Startups will die before being born.
• Companies that need a long "invention incubation" period -- trial and error, conceive, test and discard, until finding the "magic combination" of techniques -- use the § 102(a) grace period to do their R&D in confidence, and file patent applications only when it's clear which inventions are valuable, and how they work. Under the bill, a company will have to file a continuous stream of patent applications, many directed to inventions that are dumped under current law. This will increase patent costs remarkably.
Almost every startup goes through one of these two, many through both, as new companies create new wealth and new jobs under today's law. Inventors wait to file quality patent applications until they have quality inventions. America's unique and strong right to file in the future, after the inventor and investor know whether the invention is valuable, makes business easy, and prevents wasted costs for inventions that prove worthless.
The "America Invents Act" revokes this historic right. Property rights turn on non-business legal technicalities created to satisfy bureaucrats, technicalities that will cost $1 billion annually. The bill requires a company to file premature, hasty, and expensive patent applications on every baby-step idea to preserve rights against third parties who are dabbling in the field without intent to develop a commercial product. The America Invents Act makes these two stories nonviable for startups -- because the authors "didn't think" about them, or didn't want to.
In 2010, the Kauffman Foundation and Census Bureau released two studies on job creation. Both found that "net job growth occurs in the U.S. economy only through start up firms." If creating new jobs is Congress's Job One, then killing the America Invents Act is a good place to start.
Proponents suggest that the bill does away with complex and costly interferences. That's true, but irrelevant. Under 100 applications per year end up in interferences. In contrast, the change to today's "§ 102(a)" grace period affects commercial decisions and raises costs for hundreds of thousands of inventions per year, during the time before filing, by giving inventors and patent attorneys time to get it right the first time. Because the Patent Office has no insight into the pre-filing process of invention, it simply hasn't taken into account the realities of invention incubation and the costs of its proposal. Further, the proposed replacement, "derivation proceedings," are the most costly disputes in patent law.
Second, proponents argue that provisional applications will be a cheap way to preserve rights. But that isn't true under the new law. Under current law, a cheap provisional is useful to show conception and diligence. But under Patent Reform, a provisional application only provides legal benefit if prepared with full § 112 ¶ 1 care and completeness. For a typical startup invention, the cost in attorney fees and inventor time for a provisional application is $10,000 or more -- a formidable barrier to an entrepreneur's first conversation with an investor.
Third, proponents argue, "The bill locks in rights if you publish a disclosure of the invention." But all companies rely on secrecy for their future plans. No company publishes its most sensitive and advanced technology years before introduction. This argument ignores business reality.

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