Source: https://www.ipwatchdog.com/2011/09/26/america-invents-a-simple-guide-to-patent-reform-part-1/id=19427/
Timestamp: 2019-04-25 14:24:08+00:00

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Earlier today I spoke at the Practising Law Institute program on the America Invents Act. We had a good turnout in the room and an excellent turnout via webcast. The program was 4 hours long, and truthfully we could have gone on for at least several more hours without running out of material. For those who stayed online we ran long by about 20 minutes, and stayed talking with attendees and answering questions of live attendees for another 20 minutes. We are already talking about reprising the presentation for an audience at PLI’s New York City location on Seventh Avenue, so stay tuned.
There will be plenty of time to drill down on the particulars of the America Invents Act. The Act is dense, language choices from section to section in some places change and in other places remains the same, making you suspect that different terms must mean different things but the same term in different places has to mean the same thing, right? Our moderator, Denise Kettelberger (Faegre & Benson) said that patent attorneys should really read the Act about 10 times, which is really good advice. Every time you read it you notice something a little different, and during the presentation of others today I found myself taking notes and looking up things in the Act with new understandings. This is a major re-write of patent laws and not one that is at all simple.
That being said, I thought I might take this opportunity to provide a high level overview of the America Invents Act. What follows is discussion of 5 provisions contained in the Act. Look for an overview breakdown of additional provisions (prior user rights, supplemental examination, post-grant review, etc.) coming soon.
The biggest change to US patent laws, and certainly the most discussed, is the fact that the United States has now converted from a first to invent system to a first to file system. Saying that we have a first to file system, however, might be a little misleading given that the term “first to file” has certain international meanings that will not apply.
A traditional first to file system is one that demands absolute novelty in order to obtain a patent. A traditional first to file system means that if there is a prior use or publication of information relating to the invention no patent can be obtained. That, however, is not what the US first to file system mandates.
Under the US first to file system the inventor will still have a personal grace-period, which is not available to inventors outside the US. This personal grace-period says that the inventor’s own disclosures, or the disclosures of others who have derived from the inventor, are not used as prior art as long as they occurred within 12 months of the filing date of a patent application relating to the invention. However, and this is a very big however, disclosures of third-parties who independently arrived at the invention information will be used against the inventor. Said another way, there is no grace-period relative to third party, independently created disclosures. This is an enormous difference between the old law and the new law.
It is important to understand that under the new law an inventor is always better off filing sooner rather than later. File early and often. Nevertheless, there is not a true race to the Patent Office set up by the new law. In order to be awarded a patent one must still be an inventor. Those who learn of an invention cannot now, nor can then under the new law, beat the inventor to the Patent Office and obtain a patent. Inventors must contribute conception and stealing from another provides no conception that will support the awarding of a patent.
The first to file provisions go into effect on March 16, 2013.
False marking cases arise from 35 USC § 292, and were given new life thanks to a Federal Circuit decision from December of 2009 — The Forest Group Inc. v. Bon Tool Co. — which quite correctly and quite literally interpreted § 292. Prior to the enactment of the AIA anyone could bring a legal action in court to seek damages when someone affixed a patent number on a product when the product was either not patented or the patent had already expired. The the damages that could be recovered by the person bring the lawsuit was $500 for each case of mis-marking, regardless whether there was any damage to anyone, including the party bringing the lawsuit.
Judge Moore recognized the argument that interpreting § 292 to apply on a per article basis would encourage “a new cottage industry” of false marking litigation by plaintiffs who had not suffered any direct harm. That is, however, what the clear language of the statute allows. The Federal Circuit held: “the plain language of 35 U.S.C. § 292 requires courts to impose penalties for false marking on a per article basis.” And a cottage industry was borne, with large corporations being sued for many tens of billions of dollars.
With the passage of the AIA only the United States may sue for the civil penalty authorized by 35 USC 292(a). Nevertheless, a person who has suffered a competitive injury as a result of marking a product in violation of § 292 may file a civil action in a district court of the United States for recovery of damages adequate to compensate for the injury. However, the marking of a product with a patent that covered that product but has expired is no longer a violation.
These new marking provisions apply to all cases, without exception, that are pending on, or commenced on or after, the date of the enactment – September 16, 2011.
Perhaps the best thing done by the America Invents Act is the curtailing of patent troll litigations. How does the Act do this? By making it impossible for patent trolls to bring a patent infringement litigation against dozens of defendants, sometimes well over 100 defendants, in a single infringement action. Courts that allowed this would keep defendants today, limit the ability of each to fully defend themselves and facilitating in what can best be characterized as a shakedown.
Before the AIA a patent owner could sue any number of defendants who were geographically scattered across the country, who offered different products and/or services, selecting a district court that was perceived to offer a friendly environment for a patentee. That district court was overwhelmingly the United States District Court for the Eastern District of Texas. This would allow a patent owner to economically sue a large number of defendants and then proceed to seek to settle the case for nuisance value, which several federal courts have referred to as characteristic of extortion.
The anatomy of a shakedown is best shown by Eon-Net and its related entities, who filed over 100 nearly identical lawsuits against a number of diverse defendants alleging infringement of one or more patents. In each case, after the complaint was filed there was a quick follow-up with a demand for a quick settlement at a price far lower than the cost of litigation.
In this case Eon-Net offered to settle using a license fee schedule based on the defendant’s annual sales: $25,000 for sales less than $3,000,000; $50,000 for sales between $3,000,000 and $20,000,000; and $75,000 for sales between $20,000,000 and $100,000,000. Talk about a shakedown! This patent litigation made its way to the Federal Circuit after an abbreviated litigation in the district court. The district court seeing through the sham disposed of the case in summary fashion. Flagstar, the defendant, was still forced to spend $600,000 to defend, or 8 times the cost of the most expensive license offered by Eon-Net. Had the district court allowed full discovery and not ended the case early Flagstar would have had to spend far more.
Under the AIA accused infringers may be joined in one action or have their actions consolidated for trial only if: (1) A claim is made against parties jointly or severally, or a claim arises out of the same transaction, occurrence, or series of transactions or occurrences; and (2) questions of fact common to all defendants or counterclaim defendants will arise in the action. Thus, under the AIA patent owners will no longer be able to sue dozens, or hundreds, of defendants in the same case alleging that the commonality is that they all infringe the same patent.
The joinder and consolidation provisions of the AIA should substantially curb patent trolling, which is a good thing. Increasingly small businesses are being subjected to extortion-like shakedowns, and that should be less commonplace moving forward. These joinder and consolidation changes became effective on September 16, 2011.
The best mode requirement historically created a statutory bargained-for-exchange by which a patentee obtains the right to exclude others from practicing the claimed invention for a certain time period, and the public receives knowledge of the preferred embodiments for practicing the claimed invention. The best mode requirement was a safeguard against the desire on the part of some people to obtain patent protection without making a full disclosure as required by the statute. Failure to disclose the best mode of the claimed invention was grounds for finding the claim at issue invalid.
With the enactment of the AIA the best mode requirement has largely been gutted. The failure to disclose the best mode is no longer a basis on which any claim of a patent may be canceled or held invalid or otherwise unenforceable. This applies to all litigation proceedings commenced on or after September 16, 2011. However, 35 USC 112 still requires the disclosure of the best mode known to the inventor, so legally applicants are still required to disclose the best mode even though failure to do so will not invalidate an otherwise valid claim.
Sections 119(e)(1) 20 and 120 of title 35, United States Code, are each amended by striking “the first paragraph of section 112 of this title” and inserting “section 112(a) (other than the requirement to disclose the best mode)”.
This means that no longer will a previously filed application need to disclose the best mode in order to be entitled to claim priority. So the question is this — why would Congress keep the best mode requirement if they were going to completely gut it? Why not just eliminate the best mode requirement from 35 USC 112?
After the enactment of the AIA the failure of an infringer to obtain the advice of counsel with respect to any allegedly infringed patent, or the failure of the infringer to present such advice to the court or jury, may no longer be used to prove that the accused infringer willfully infringed the patent or that the infringer intended to induce infringement of the patent. This new law picks up on the Federal Circuit’s decision in Seagate, where the Court said that there was no affirmative obligation to obtain a non-infringement opinion.
Those doing opinion work no doubt saw a steep decline in their workload after Seagate. To the extent that there is still opinion work circulating there will likely be another decline as a result of the AIA.
There are, however several remaining questions. Will courts interpret 35 USC 298 to preclude consideration of the lack of an opinion of counsel in the determination of whether to enhance damages? Will courts interpret 35 USC 298 to preclude consideration of the lack of an opinion of counsel relative to sanctions motions and awarding of attorneys fees when there is little or no due diligence prior to bringing an action?
With respect to the second question above, with opinions have any relevance in sanction motions? 35 USC 298 could actually have the unintended consequence, and unfortunate intent, of giving those bad actors who already do little or no due diligence a reason to do even less due diligence prior to bringing a cause of action for patent infringement. Thus, it will be up to the courts to police the ever increasing practice of bringing extortion-like litigation without any due diligence in an attempt to shakedown defendants, many of whom hardly come close to infringing.
A publishes first. 6 months later, B (in, say, Germany) ignorant of A’s publication or his invention, invents independently and files, also in English, at the EPO, publishing immediately thereafter. Soon after that, A (ignorant of B) files at the USPTO (within one year of his own first publication). At the end of his Paris year, B files at the USPTO, declaring his EPO priority date. Who gets the patent from the USPTO?
From the O, I take it that the better view of 102 is that it neutralises as prior art against A any independent public disclosure of A’s subject matter by any B, as long as B’s was later in time than A’s own disclosure.
But perhaps you can convince us otherwise?
Never were truer words said about the AIA which may soon rival Hatch-Waxman for its labyrinth of sepentine turns and twists in language.
I would like to echo that sentiment.
I have not reached the 10X level –definitely not for the ENTIRE AIA– but each re-reading brings to light certain ramifications that were not self evident from a fast first read through.
Also another piece of advice is to join discussion groups with other attorneys who are trying to weed their way through this patent law “thicket”. Ten pairs of critical thinking eyes are oft better than just one.
apart from here, what do you recommend.
I hate to show my ignorance, but why isn’t A’s initial publication cited against B’s application at the USPTO?
And one final (for now) question.
Is anyone sorting out the difference between “a printed publication” per 102(a)(1) and a “disclosure” per 102(b)(1)? Why the different terminology? Can something be a printed publication but not a disclosure?
What makes you think the grace period is not available to inventors outside the US?
Gene, We have already agreed to disagree whether or not the AIA “grace” period provides any immunity against subsequent independent third-party disclosure. Last week’s guest post On Patently O by Prof Lefstin of Hastings stated “The simplest approach would be that inventor disclosure immunizes any claim that encompasses the inventor’s disclosure. Under this approach, prior art appearing subsequent to the preclusive disclosure cannot be asserted against a claim reading on the preclusive disclosure.” I think part of agreeing to disagree is to acknowledge that a legitimate disagreement exists among well-qualified thinkers on the subject, rather than presenting one’s own interpretation as the undisputed truth as you have done above.
My take is that “disclosure” per 102(b)(1) has a broader meaning than “printed publication” in 102(a)(1). As I interpret it, the term “disclosure” (which notably does not include the word “public”) should cover a printed publication, a public use, a sale (even a private one) and any other form of disclosure that might be a bar to novelty under 102(a)(1).
To Mark Nowotarski, and his Q5, at 9:47 above.
It is Mark, it is. (Or rather, I should say, not being a US attorney at law, I think it is.) Did I ever say it wasn’t?
I’m more interested in what valid scope A can get, given what B independently published before A’s effective filing date. How, I wonder, does A stand on the patentability of obvious variants of what he himself published before he filed?
Senator Cantwell is right. Just because they call it “reform” doesn’t mean it is. The agents of banks, huge multinationals, and China are at it again trying to brain wash America.
4mark, without being particularly involved in US patent law, it seems to me that neither A nor B will get a patent in the US.
For B, the invention is already state of the art, so he will nowhere get a patent.
For A, the fact that B made the invention public before A filed falls directly into §102. I do not see why the earlier publication of A should ‘neutralise’ a later publication of B. Why should A file a patent anyway, if his early publication ‘neutralises’ later publications by third parties?
I would expect that A’s initial disclosure acts as a “published provisional”. If the examiner cites B’s application against one or more of the limitations in A’s claims, A could antedate B by showing support for said limitations in said initial public disclosure.
Mark, you say at 12:12 that you would “expect”. I have to tell you that others, on Patently-O have different expectations.
But, to go with yours, I’m intrigued. Here is another strong reason to disclose your invention very early. Your publication will deprive everybody else of any chance to patent anything which your publication renders obvious. But it leaves you yourself totally unencumbered, and free to patent it all, in the months and years to come, at your leisure, as you dream up with one variant after another, regardless whether those variants are inventive, or as obvious as old rope. Brilliant.
If you are a member of the LinkedIn social network, go to the Groups tab and search for all groups having the word “patent”. You should get about 200 hits. I think discussions about AIA are springing up in a number of these. Practitioners are waking up and starting to smell the AIA coffee.
Some of these groups are private and thus closed to the public. You have to request to join and they vet your request in some unknown way or another (example make sure you truly are a registered patent attorney of agent).
I wonder whether the joinder issue really just means the rise of Multi-District Litigation all the way up and until trial. Even pre-AIA cases were set up that way. It seems now defendants will all seek transfer to their various favorable jurisdictions and the plaintiffs will simply request MDL and hope for a favorable jurisdiction for the pre-trial litigation. Net result: no change.
Gene, for discussion, here is my own “high level overview” of the AIA roughly in the order of importance to the greatest number of patent practioners, in a “Top 10” list. Let me know if you disagree with anything.
(1) The 102(a)(1) statutory bars will become immediate bars, no longer only after one year. No more Rule 131 declarations to “swear behind” intervening prior art.
(3) In re Hilmer dies – foreign applications filed in the U.S. will become prior art as of their foreign filing dates.
(4) Other AIA bar issues being arguged due to ambiguous drafting: Will prior secret commercial use [Metallizing Engineering, etc.] still be a personal patenting “forfeiture”? Will secret “on sale” activity still be a bar?
(5) Immediate elimination of “best mode” defense & delayed elimination of 102(g) “prior invention” defense.
(6) Fees: immediate 15% fee increase, [but no guarantee the PTO will get to spend it] “microentity” fee reduction, $4000. fee for fast-track prosecution, etc.
(8) Gradual elimination of interferences, leaving only a limited “derivation” protection system plus false inventorship defenses under new 100, 101, and inventorship declarations.
(9) New patent reexamination systems: oppositions on any issue for 9 months after issue [risking total estoppel], ex parte “supplemental examinations” for patent owners to eliminate inequitable conduct or other issues pre-litigation, amended inter parte reexaminations, & “business method” patent reexaminations.
(10) Made easier: prior art citations against applications of others, inventorship corrections and declarations.
OTHERS to also consider mentioning: expands the limited prior commercial user personal infringement defense to all patents [no longer just business methods]; makes tax strategies and humans unpatentable; and immediately restricted the joinder of unrelated defendants in patent infringement suits.
Prior art disclosures made publicly available one year or less before the effective filing date can be overcome by applicant showing (1) the prior art disclosure was by another who obtained the disclosed subject matter from the applicant (a deriver), or (2) the applicant or a deriver publicly disclosed the subject matter before the date of the prior art disclosure.
In response to Mark’s comment No. 4, it seems to me that a “printed publication” must be a document that has been recorded in some form or another, e.g., electronically or on paper, and must be publicly available. This is not as clear-cut as it seems. More than twenty years ago I was involved in a case involving a schematic diagram taped to a kitchen door. Many people went through that door but it was difficult to prove that it was a printed publication.
A disclosure does not seem to require that it be recorded and therefore it could oral.
Ted, when they wrote the European Patent Convention, in the 1960’s, I guess they knew that “printed publication” is not easy to construe. So, deliberately, they defined the state of the art as “everything made available to the public, by written or oral description, by use, or in any other way”. Brutal but effective.
I suppose that option was not open to the drafters of the AIA.
One of the features of traditional interferences was jockeying over what “the count” will be, including motions that used to be called “no interference in fact” and “no right to make” motions. The former was where one party took the position that each party should be allowed to get its own patent because the parties’ claims were patentably distinct from one another. The latter was that the other party should automatically lose the interference because his/her/its specification did not provide support for the count. I am not sure what current interference practice calls these kinds of motions, but I don’t see them going away in a ftf world.
Mark, my position is that the “grace” period does provides some limited immunity against subsequent independent third-party disclosure, but I wouldn’t personally rely on the grace period at all, or advise my clients to do so. File an enabling provisional before disclosing anything, or as soon as possible if a disclosure has already been made.
I hear what you are saying about file first, publish later. The challenge for startups and independent inventors, however, is cost. Creative people have many more ideas that they can file provisionals on, even if they write them themselves and only incur the small (or upcoming micro) entity fees. Under the current system, inventors are at least under the impression that if they write their ideas down and date + witness them, then they can spend a few months to see which ones have potential file and file provisionals on just those.
So based on simple economics, I believe that there is going to be a continuing demand for a very low cost way to preserve patent rights while a large number of an inventor’s early stage ideas are under development.
Sounds like a fun case.
Mark, As a startup founder and independent inventor myself, I was not in favor of AIA, although FTF per se would not have necessarily been a bad thing, if a stronger, better-articulated grace period had been crafted. But even under the old law, I believe it was unwise to rely on the grace period. So in the long run, FTF may be a good thing if it gets people to file earlier rather than later. In my experience, a serious startup entreprenuer with a worthwhile new idea needs to be prepared to make a low 5-figure investment of their own money (or very sympathetic family members, if necessary), if they want to persuade other investors to put in several times that during the first year of provisional pendency. A few hundred dollars plus some personal sweat to file the provisional is really just a small part of the kind of discipline and effort required to get something past the “good idea” stage and off the ground. Waiting for the world to beat a path to your door and shower you with money for your better mousetrap is a pipe dream.
We can agree to disagree, that is fine. Once the USPTO comes out with guidelines I know I will be proven correct, and correct again when the BPAI and CAFC weigh in on the issue.
As far as agreeing to disagree requiring me to acknowledge that there is legitimate disagreement where no such legitimate disagreement really exists is not something I am going to do. Just look at what you quote. On its face it is absurd. “The simplest approach would be that inventor disclosure immunizes any claim that encompasses the inventor’s disclosure.” The trouble with that is it requires different terms (i.e., “disclosure” and “subject matter”) to mean the same thing. You see 102(b)(1(A) relates to the inventor’s disclosure, and 102(b)(1)(B) relates to “subject matter.” So under your reading once and inventor discloses then the inventor not only has that disclosure exempted from prior art, but also ANYTHING that relates to the same SUBJECT MATTER. That is absurd, no court will ever go along with that reasoning, and 102(b)(1)(B) clearly on its face is aimed at SUBJECT MATTER derived from the inventor.
I have pointed out that the initial USPTO statement of issues confirms my position when they pointed out that the exceptions deal with the inventor’s disclosure and those that are derived from the disclosure. You choose to ignore this because it was only a statement of issues that they are interested in receiving comments on. Interestingly they didn’t ask for comments about giving an inventor preemptive right to patent an entire SUBJECT MATTER of material based on a single, particular disclosure of AN INVENTION. Of course the USPTO statement is far more significant than you allow, and that will be shown in time.
Also, you continue to ignore that for a great length of time, at least 2 to 3 years, this bill has been sold as ONLY providing a personal grace period for an inventor. Only at the last minute in the legislative history (which Courts will not consider) was there an effort to say otherwise.
So I am happy to acknowledge that YOU and some others have a particular view of what 102(b)(1)(B) means, but the face of the clear language of the statute support me. To get it to mean what you want you have to ignore the second reference to SUBJECT MATTER in that section, which is something that Courts will not do. They will read the entirety of the section.
The plain meaning favors my interpretation, the way the bill was sold supports me, the protestations by many groups crying there was only a personal exception favors me and the USPTO statement of issues favors e. So I am not going to now or ever pretend that there is legitimate disagreement, particularly when I am urged to do so in the face of a clearly erroneous statement.
I sense you are taking that comment to mean something I didn’t intend for it to mean. Perhaps the natural handicap of being an electrical engineer is showing with inappropriate placement of commas, or just an inartfully constructed thought.
Under the US first to file system the inventor will still have a personal grace period — end of thought.
A personal grace period is not something that applicants filing in countries outside the US enjoy.
In other words, in most of the rest of the world there is no grace period at all, not even a personal grace period.
I didn’t intend to imply or suggest that foreign inventors would not be able to avail themselves of the grace period under US law when a US application has been filed.
I am curious what makes people think that section 299 will reduce patent trolling? In many cases, defendants are better of being joined in a suit because they can all “hide” behind the “big boy” in the group. Filing individual suits will force each defendant to separately defend the suit.
Really this act just creates a lot more work for defense lawyers. Plaintiffs will likely keep filing their suits, except now they’ll be filing individual suits. No big deal for plaintiffs…?
Not saying which way I lean, but at an event in Ohio this past month Bob Stohl indicated that the exceptions covered by 102(b)(1) pertained only to derived disclosures and did not pertain to independent invention. Add to that the technical difficulties in proving derivation (per the thoughts of David Boundy) and the potential for some very rude surprises is rather high.
Forgive me for interjecting, being as though I am not American and not an attorney at law. I’m just the small boy watching the Emperor process past me, and crying out that he has no clothes.
Disclosure means the act of disclosing something. That there has been a “disclosure” says nothing about the substance of “what” has been disclosed, as a consequence of the act of disclosure.
Subject matter means that substance, which has been disclosed.
The right to get a valid patent in respect of subject matter that has already been disclosed is indeed personal to the inventor of the subject matter of the invention. The disclosure of the subject matter stops everybody from getting a valid patent on that subject matter, except when the disclosure derives from the inventor named in the patent. Bob Stoll meant what he said.
1) Start with the presumption that all furtherdisclosures, subsequent to that by or deriving from the inventor named in the patent are also derived disclosures. Put on the disclosers who say their disclosures are NOT derived the burden of proving that they are not derived.
2) Grace all such subsequent disclosures, that is, deem them to be derived from the inventor.
For me AIA 102 uses “disclosure” and “subject matter” as I do above, and uses 2) to avoid the certainty of recurrent nightmares in litigating new 102.
Gene, Horse, what am I not seeing here?
This very line of thought has been expressed on the other blog, Patently-O.
The problem you have is by what right can you make this presumption? You are in essence legally taking an independent inventor’s right away with no regard to due process. In the US, such a presumption should run right smack into Constitutional constraints. It’s a no-go from the start.
This is already in place – see the requirement of a declaration by the inventor.
However, even this step is significantly weakened with the new law that lets Big Corp sign and process applications without the inventor agreeing to sign the declaration. Do you see the problem? An inventor can come up with an invention and the process of writing the application can include more than what the inventor invented (for example, adding material to try to cover a competitors devleopment efforts) and the inventor can balk and refuse to sign the declaration. That now will not stop the Big Corp from being able to process the application regardless of what the inventor beleives the invention to be. As long as Big Corp acts in what it perceives to be a legitimate manner (itself “believing” what it thinks the invention to be – as reasonable people can disagree over such things, especially in team efforts), there really is no stopping Big Corp.
Your 2) comment is merely a restatement of your 1) comment. I think that the awareness of “to avoid the certainty of recurrent nightmares in litigating new 102” is growing. As written, the new law will indeed bring a certainty of recurring nightmares.
Horse? From another blog. Sorry.
I am in FtF land and am a stranger in FtInvent land, so can’t see all the situations that might develop when FtI people first get to drive a FtF vehicle.
Forget First to Invent. Going forward, I think we have to distinguish between A’s right to a patent and B’s, under a FtF system. It no longer matters who invented first. The only thing that matters is who files first.
That said, it matters that the patent goes to the true inventor, not to a thief. In Europe, anybody can file but if the patent issues to somebody other than the true inventor or that human person’s successor in title, that patent is bad. Better get title sorted out really good, during pendency, or else the roof falls in.
With a grace period, the true inventor can still get a valid patent, even if he publishes before he files, and even if B files before he does. The A publication smashes the B filing. Personally, for A alone, the A publication is graced. And A still gets a patent even if B publishes after B files but before A files.
The only remaining issue is whether A still gets a patent if B’s publication owed nothing to A. To me, it seems unfair on A to deprive him of his patent. The grace period of new 102 should be meaningful. Giving it with one hand, then taking it away with the other, when B publishes, strikes me as not what the Founding Fathers would have wanted. But giving a patent to first inventor A, despite second inventor B’s publication, is in line with the sense of the patents clause, no?
Thanks. I am convinced that the USPTO view of this is that 102(b) provides the inventor who discloses a personal grace period. That is what Kappos has always said throughout this entire process, it is what the summary of the bill the USPTO published says (i.e., the one asking for comments) and it is in keeping with the Legislative History except for the stuff at the very end when Senators were saying whatever they needed to say to get the bill passed.
I think you put your finger on it accurately when you say that derivation is going to be a nightmare. This is exactly why so many commentators were writing about the USPTO being crazy if they thought getting rid of interference practice was going to lessen their workload. While interferences come up in only a rare handful of instances, derivation arguments will come up in most cases unless the inventor files before any kind of disclosure.
A question came up at the PLI program in SF about whether records need to be kept to prove conception, etc. I think the answer (and said as much) that the answer is that you must keep far MORE records under the AIA than ever before. Not only will you need to be able to show when you conceived, but you are going to need to have some kind of evidence to demonstrate who learned of your various conceptions. Recordkeeping is going to be more difficult and more onerous.
As for your thoughts, what I am hearing from sources is that 131 practice is not going to go away at all, but rather just change to fit into the requirements of the AIA. What that suggests is that the presumption will be that the subsequent disclosure was NOT derived. In that case the applicant would need to file some kind of affidavit, perhaps a new 131 affidavit or maybe they will come up with a new rule, with evidence of derivation. This will become more clear once the USPTO issues the rules and/or guidance to examiners, which they will have to do over the next 17 months.
…..and in the alternative view what new 102 means?
Suppose new 102 graces all subsequent publications of A’s “subject matter”, whether derived from A or not. Then there is no derivation nightmare, except in those cases where A carefully does not publish but, despite all that care, somebody who derived it from A does. Then, to defend his patent’s validity, A has to prove that the subject matter made available to the public before A’s filing date “derived” from him. European experience is that such cases are rare.
In the more likely scenario, of A deliberately publishing, there is no need to address the “derivation” point at all, for ALL subsequent publications of that self-same subject matter are graced by new 102, properly construed.
Corrected – the words of the law are not ambiguous, they are simply not what people have been led to believe.
You still have the problem that 102(b)(1)(A) says “the disclosure” and 102(b)(1)(B) says “the subject matter disclosed.” Those are two different things. So under your reading when the inventor discloses a specific invention anything that relates to the subject matter of that invention, but isn’t necessarily disclosed, will not be prior art. That is an extreme reading of the statute, but required unless you read “subject matter disclosed” to be identical to “the disclosure.” If they are identical then why the different use of terms?
who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor.
So for 102(b)(1)(B) you have to have the inventors invention being disclosed by either the inventor, joint-inventor or someone who derived. Then subsequent disclosures of related subject matter are not prior art if they were obtained directly or indirectly from the inventor or a joint inventor.
It seems to me that everyone is trying to turn this first to file system into a first to publish system. We went through this ad nauseum with many complaining that derivation proceedings would be commonplace and more difficult than interference proceedings. We railed against he fact that the grace period wasn’t much of a grace period at all because it was only personal to the inventor, and subsequent independent disclosure would prevent the inventor from obtaining a patent. We went through all that because of 102(b)(1)(B) not covering subsequent independent disclosure.
I hate to belabor the point, but are you saying that if an inventor discloses A, and another person independently discloses A in a later publication, that the inventor cannot swear back of the person’s independent, but later, disclosure of A?
vi) directly or indirectly from the inventor (from the inventor).
Gene, you seem to be saying that 102(b)(1)(B) means basically the same thing as 102(b)(1)(A). How can this be?
Look at the subject of the sentence in (A) versus (B).
Once you understand the subject is different, then the understanding of the requirement of derivation pertaining to both (A) and (B) is more forthright.
Now I’m the one that must be blind. I only see one subject to the single sentence that is 102(b). The subject is “A disclosure”.
Where do you see two?
I agree, the subjects are different.
The subject of (A) is “the disclosure” which, based on the rest of the passage, refers to the inventor’s disclosure or a disclosure derrived from the inventor.
The subject of (B) is “the subject matter disclosed”, which refers to any disclosure of subject matter by anyone (including a third party that has not necessarily derrived the subject matter from the inventor). The rest of (B) refers to a prior disclosure of the same subject matter by the inventor or another who obtained it from the inventor.
Re: 42 Above…. That is exactly what I am saying. I can conceive an interpretation of 102(b)(1) that has independently arrived upon disclosures being prior art for the inventor. Many disagree with me, but I am going to stay the course on this one. The potential negative impact is too large for me to do anything other than play it cautious with clients. It would be catastrophic from the client’s perspective to get this incorrect.
Well that makes more sense.
Not sure, Mark and Gene, what the concept of “swearing back” means in a FtF environment. Does anybody care any more, on what day of the week conception occurred? Even if you do prove you thought of it before B disclosed, you’ve a long way still to go, to prove that B derived it from you. Can you say more?
Perhaps the copyright jurisprudence can be prayed in aid? Is copyright law likely to be helpful and clarifying, in the USA?
Of course one has to be careful when advising clients. That’s why this is such fun. Under a pseudonym, one can be more carefree, and provocative.
Thanks. I get it now in the sense that “the disclosure” is the subject of (A) and “the subject matter disclosed” is the subject of B.
This is an EXCELLENT discussion. I don’t know that anyone will change their mind, but I think we are getting to the issue of what really bothers me.
The legislative history is SO clear as to what was trying to be accomplished. All of us could write better language to make that far more clear. Unfortunately, it seems that 102(b) is now a muddled mess of different terms and rather poorly articulated ideas. Given that we are dealing with an end-of-game moment for the client I am playing it very conservative. A statutory bar mistake has always been something for which there is no fix, and that will continue with the AIA. The lack of precise language makes me worried.
4Mark @ 43… I think the difficulty is that the term “disclosure” is used in multiple different places and it isn’t defined, which allows for various interpretations to potentially exist. For example, does “disclosure” in 102(b) relate to public use and offers for sale, or does it only relate to publication? With something so fundamentally important it would have been nice for Congress to be a little more specific.
102(b)(1)(A)… the inventors own disclosure cannot be used against him/her and neither can a disclosure that is derived by others be used against the inventor. I understand “disclosure” to narrowly be tied to the specific invention disclosed.
102(b)(1)(B)… first the way I read this section is that it is only applicable if the inventor has previously disclosed. Upon disclosure by the inventor it is certainly conceivable that others will pick up that disclosure, continue working on it and then subsequently disclose something themselves. So if a subsequent disclosure (i.e., subsequent to the inventor’s disclosure envisioned in (A)) relates to similar subject matter and that subsequent disclosure is the byproduct (i.e., derived) of the inventor’s own work then the subsequent subject matter is not prior art.
I just do not see a situation where an independently arrived at disclosure will not be prior art. They could have said that directly if they wanted, but choose not to say it directly. They also use different terms “disclosure” and “subject matter” as if (A) and (B) are intended to cover different scenarios. If I am understand the position that is contrary to my own (A) and (B) are redundant. We know that the Court’s won’t interpret them as redundant and will look for separate meaning… that is just straight forward statutory construction.
If derivation is going to be an issue, large or small depending upon how 102(b)(1) shakes out, you will still want to be able to show conception dates. If you have conception prior to a disclosure that would be at least some evidence that derivation is possible. If there is no evidence that there was conception prior to disclosure by another I don’t know how you could demonstrate derivation.
Inventor discloses a specific embodiment of a coffee cup.
Subsequently another who did not derive independently comes up with and discloses a coffee cup with a lid. Because the subsequent disclosure relates to the same subject matter it cannot be used against the first to publish inventor as prior art. That would mean that Inventor could incorporate the cup and the lid into his/her patent application and obtain claims.
I don’t see this example as far fetched. The “disclosure” has to be different than “the subject matter disclosed.” Subject matter disclosed seems broader.
I think that whichever way you interpret 102(b)(1)(B) you have to make certain assumptions, which is less than ideal. I just don’t see any court giving an inventor an option to file a patent on an entire subject matter line because of one particular, specific disclosure. That leads unlikely outcome leads me to seek an alternative way to read 102(b)(1)(B) that is more in keeping with traditional patent norms.
I too am enjoying the discussion and I’m not trying to change anyone’s mind, but simply try and understand their position.
But setting aside the language of the law for a second, you seem to be concerned that if “independently arrived at disclosure” could be antedated by an earlier disclosure by the inventor, this would be a major problem.
How so? We have that situation now where you can antedate an “independently arrived at disclosure” by showing conception prior to the effective date of the reference followed by diligence to an actual or constructive reduction to practice.
Take out “conception” and replace it with “publication” and you have the same thing (minus the diligence requirement).
It seems to me that this comes closest to maintaining the status quo.
Oops. I really need to hit the refresh button before posting.
OK, now I see what your concern is Gene. And I agree that 102(b)(1)(B) will not be interpreted so that the entire “coffee cup plus lid” disclosure document will be antedated for all of its subject matter by an earlier disclosure of merely a coffee cup.
Don’t you think I should be able to antedate the “coffee cup plus lid” reference for the “coffee cup” subject matter even if the “coffee cup plus lid” was arrived at completely independently of me?
My concern is that you won’t be able to antedate once the AIA first to file provisions go into effect. If you do not file first you are out of luck getting a patent when the new 102(a) goes online on March 16, 2013. The only save is if one of the 102(b) exclusions apply. I have trouble believing that 102(b)(1)(B) provides an exclusion as prior art to independently created disclosures.
The way that I have always understood our version of first to file, which is how I know many others understand it, is that we have a first to file system with a personal exception for the inventor. The grace period is retained only with respect to the inventor’s own activity. If another publishes, for example, the personal grace period doesn’t save the inventor. So we have a very weak, very limited grace period. I wrote about this quite a bit a while back with respect to S. 515, which has the same language. This was a real fear in the independent inventor community, and the USPTO was always selling it as a personal grace period. I even spoke with folks at the USPTO telling them there was no reason why we couldn’t have first to file with the same, full, complete 12 month grace period we have now.
Should you be able to antedate the coffee cup plus lid?
I really have no idea, and this is what is scary. I hear from a lot of people focusing on 102(b) and overwhelmingly I am hearing (from some very large firms included) that they are interpreting 102(b) as I have interpreted it and are worried about the meaning of “disclosure.” What is a “disclosure”? I take it one step further to ask, what is “subject matter of the disclosure”? Obviously, you cannot answer the second without knowing what the first means.
With something as fundamental as a game-over statutory bar I don’t see any way to responsibly interpret 102(b) other than in an ultra conservative way. If and when I have a client that needs the other argument I will make it, but my advise is file early and often so that you aren’t the one determining what the meaning of “disclosure” is. Keep your clients out of those patent law case books!
It seems to me that the most prudent and conservative thing for a large filer to do is use the next year and a half to set up some test cases to see exactly where the boundaries of the new law are.
A lot of. time and ink is being wasted discussing provisions of the AIA that will be so rarely used that most practitioners will never encounter them in their professional lifetime. The AIA Sec. 135 “Derivation proceedings” are a prime example.
I understand what you are saying about “Derivation proceedings.” Perhaps I have been using the term in a way that is contrary to how it is actually defined in the statute. I think the issue of derivation will be anything other than rare. There will be some kind of update or modification to 131 practice to handle the situation when an examiner is using a reference against an applicant and the applicant believes that he/she is entitled to get behind it because it was derived from their own disclosure.
The true “derivation proceeding” seems to be the new interference proceeding, where an earlier filed applicant is being accused as having derived from a later filing applicant.
Derivation cases are small now – and that is in relation to the current law.
You cannot extrapolate to the new law, especially if “independent invention” becomes an easy way to kill a competitor’s patent. If indeed (as I believe) the exceptions under 102(b)(1)(A) and (B) are very shallow and only provide a personal grace period, the rise in such “independent inventions” will skyrocket.
You can no more claim that this area is a waste in time than claim that there will be no unforseen consequences. You simply have no basis for the conjecture that “will be so rarely used that most practitioners will never encounter them in their professional lifetime.” If you had that type of foresight, I would suggest lottery tickets and the stock market is where you should be spending you rtime.
More than just the “blessing” of the client, I believe some large filers will be very proactive. When Peer to Patent was launched, for example, large filers like HP and IBM were very proactive in posting applications on it to see how the system would respond.
And how did Peer to Patent perform?
The First Inventor to File (FITF) provisions transition the U.S. to a first-inventor-to-file system from a first-to-invent system, while including a 1-year grace period for disclosures by (or derived from) applicant. Prior art disclosures made publicly available one year or less before the effective filing date can be overcome by applicant showing (1) the prior art disclosure was by another who obtained the disclosed subject matter from the applicant (a deriver), or (2) the applicant or a deriver publicly disclosed the subject matter before the date of the prior art disclosure. The effective filing date for a claimed invention in an application now includes the filing date of a prior foreign application if applicant is entitled to foreign priority and thus, in this situation, the 1-year grace period will be measured from the foreign priority date claimed. A prior disclosure of the invention which is publicly available more than one year before the effective filing date of an application continues to be a statutory bar. Prior public use or sale is no longer limited to the U.S. For prior art purposes, U.S. patents and patent application publications are available as prior art as of any foreign priority date, provided that the subject matter being relied upon is disclosed in the foreign priority application. Applicants can now rely on common ownership or joint research agreement provisions to overcome rejections under 35 U.S.C. 102. In addition, derivation proceedings are established in place of interference proceedings for FITF applications and patents. The FITF provisions take effect on March 16, 2013. 35 U.S.C. 102 and 103 in effect before March 16, 2013 will apply to applications filed before March 16, 2013, and continuations and divisionals of such applications. 35 U.S.C. 102 and 103 in effect on March 16, 2013, will apply to any application that ever contains a claim that has an effective filing date on or after March 16, 2013. 35 U.S.C. 102(g) in effect before March 16, 2013, will apply if the application ever contains a claim that has an effective filing date before March 16, 2013.
I agree that the AIA’s limitation on joinder in patent litigation is a welcome provision. Patent litigation costs, particularly when instigated by NPE suits, can create enormous inefficiency; any measure that helps to address this issue, even indirectly, may be seen as a step in the right direction.
A simple answer is that Congress doesn’t want Best Mode litigation, but still thinks PTO examiners should be able to require it as a step toward patentability. Lying to an examiner is still a grounds for invalidating a patent.
The problem with your analysis is that the patent examiner never knows about best mode. The best mode is personal to the inventor and there is no way a patent examiner can ever know whether the inventor contemplated something and did not disclose. Best mode has never been a part of prosecution.
After reading this excellent discussion and then going back to read the language of the statute, I had a few “ah hah!” moments of understanding. I have a few insights I’d like to share.
I believe that 102(b)(1)(A) is the specific case where a public disclosure has been made by an inventor or a deriver of the inventor’s work prior to the patent application date by the inventor, and that public disclosure can be removed as prior art to the inventor’s patent application under 102(b)(1)(A).
I believe that 102(b)(1)(B) is the specific case where a public disclosure has been made by an unrelated third party that did not derive the subject matter of the public disclosure from the inventor, and that public disclosure by the third party can be removed as prior art to the inventor’s patent application only if the inventor or a deriver has publicly disclosed the subject matter contained in that third party’s public disclosure prior to the date of the third party’s disclosure (and which subject matter is also the same as claimed/disclosed in the inventor’s patent application). 102(b)(1)(A,B) are only in effect during a time period within one year prior to the inventor’s patent application.
102(b)(1) has three parts to it, which I’ll call Introduction (1), Exception (A), and Exception (B).
The language in Introduction (1) is generically referring to “a disclosure” that can be any disclosure at all that is dated within one year prior to the filing of the inventor’s patent application. That is, “a disclosure” can be the inventor’s own public disclosure, a public disclosure derived from the inventor’s work, or a public disclosure made by an unrelated third party that was independently arrived at (i.e., not derived from the inventor’s work).
To specify which of these “disclosures” is being referred to in Introduction (1), the statute further provides Exceptions (A) and (B).
Here, “the disclosure” is referring to “a disclosure” stated in Introduction (1), and Exception (A) is defining the “a disclosure” to be a public disclosure that was either (i) made by the inventor, or (ii) derived from the inventor’s work. In other words, Exception (A) is the case where the “a disclosure” is actually the inventor’s own work, whether this work is directly (by the inventor) or indirectly (by a deriver) disclosed to the public.
Here, “such disclosure” is referring to “a disclosure” stated in Introduction (1), whereas “the subject matter” is actually referring to both the subject matter of the “a disclosure” in Introduction (1) and also to the subject matter of a public disclosure made by the inventor (or a deriver) stated in Exception (B). Exception (B) requires that the inventor (or a deriver) has publicly disclosed “the subject matter” of the “a disclosure” prior to the date of the “a disclosure” (but within one year prior to the inventor’s application date).
Thus, in the case of Exception (B), the “a disclosure” in Introduction (1) is not a public disclosure made by the inventor or derived from the inventor’s work. Instead, Exception (B) is the specific case where the “a disclosure” stated in Introduction (1) is made by an unrelated third party that independently arrived at the subject matter of the “a disclosure.” In order for Exception (B) to be triggered and the “a disclosure” removed as prior art, it requires that the inventor (or a deriver) has publicly disclosed “the subject matter” of a third party’s “a disclosure” prior to the third party’s “a disclosure” (but both the inventor’s (or deriver’s) public disclosure and the third party’s “a disclosure” must be the same subject matter and must be dated within one year prior to the inventor’s application date).
“A lot of academics and folks go to trade shows and begin talking about their concepts and what they have done. If you disclose this, you have a year to file after you disclose the information. And under the bill’s second, enhanced grace period, no other disclosure, regardless of whether it was obtained from the inventor, can then invalidate the invention” (Congressional Record, Senate (March 3, 2011) at page S1175, bottom of left column).
In this excerpt, the “second, enhanced grace period” is referring to 102(b)(1)(B), as opposed to the presumed first, enhanced grace period, which must be 102(b)(1)(A).
Here, the “prior art disclosures” can be overcome under two exceptions, (1) and (2), that correspond to 102(b)(1)(A) and 102(b)(1)(B), respectively. In (1), the prior art disclosure can be overcome if the disclosure was derived from the inventor’s work. It appears here that the USPTO does not mention the case where the prior art disclosure actually is the inventor’s own disclosure, but this case is explicitly provided for in 102(b)(1)(A), as discussed hereinabove. In (2), the prior art disclosure can be overcome if the inventor or a deriver publicly disclosed the subject matter of the public disclosure prior to the date of the public disclosure. This language is in line with my interpretation of 102(b)(1)(B) above, and this language differentiates between the prior art disclosure and the public disclosure made by the inventor/deriver.
In summary, I think the foregoing discussion shines a little more light on the prior art-removing provisions of the AIA. Specifically, 102(b)(1) provides for a disclosure to be removed as prior art if: (1) the disclosure is the inventor’s (or a deriver’s) disclosure (102(b)(1)(A)), or (2) the disclosure was made by an unrelated third party, and the inventor/deriver publicly disclosed the subject matter of the third party’s disclosure prior to the third party’s disclosure (102(b)(1)(B)) (all of which disclosures must have been made within one year prior to the inventor’s application date).
Terrific analysis and quite convincing. One problem: this cannot be what was intended by the statute. If yes, which is well pitched by you, then we do not have 1st to file, we have 1st to disclose. Most US inventors will then unwittingly kill off any foreign rights by a rush to disclose. And, in truly morbid fashion, the only inventors to benefit from this are foreign inventors who disclose, but none-the-less maintain a US grace period, and can only obtain a patent in the US and no where else.
The statute could simply have copied the existing 102(b) language which establishes a 1 year grace period. It is well papered in case law, is well understood, and has been around for 150 plus years in US law. No ambiguity would result. Instead we have this new statute that requires tortured analysis to make sense of. A simple tweak would be to make new and old 102(b) identical as to “grace period” as to acts in the US.
Could you recommend a good book on the patent law reform for non patent attorneys? Are books prior to the AIA completely obsolete?
Far and away the best book (in my opinion) is Janice Mueller’s book titled “Patent Law.” I have recommended it to law students trying to learn the subject matter for years. It is easy to read and very accurate. It is sometimes difficult to do justice to a subject while still making it readable, and Janice succeeds enormously well.
Getting it now would be fine, but in 15 months the law will change substantially for applications filed on or after March 16, 2013.
It is unfortunate that the USPTO did not adopt the interpretation proposed by Prof. Leftsin that I allued to in 9 above.
The bottom line is still what I have maintained all along, which is that although the “grace period” has been significantly weakened by AIA, making it more unwise than ever to rely upon it, I would not advise a client to concede defeat and throw in the towel before filing just because a subsequent disclosure by a third party _might_ be prior art.

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