Source: https://www.bitlaw.com/source/mpep/2133_03_b.html
Timestamp: 2018-02-18 10:51:09
Document Index: 30785355

Matched Legal Cases: ['§2133', '§2133', '§ 1', '§ 2', '§ 1', '§ 1', '§1']

MPEP 2133.03(b): "On Sale", Jan. 2018 (BitLaw)
MPEP 2133.03(b)
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2133.03(b) "On Sale" [R-08.2017]
An impermissible sale has occurred if there was a definite sale, or offer to sell, more than 1 year before the effective filing date of the U.S. application and the subject matter of the sale, or offer to sell, fully anticipated the claimed invention or would have rendered the claimed invention obvious by its addition to the prior art. Ferag AG v. Quipp, Inc., 45 F.3d 1562, 1565, 33 USPQ2d 1512, 1514 (Fed. Cir. 1995). The on-sale bar of pre-AIA 35 U.S.C. 102(b) is triggered if the invention is both (1) the subject of a commercial offer for sale not primarily for experimental purposes and (2) ready for patenting. Pfaff v. Wells Elecs., Inc., 525 U.S. 55, 67, 48 USPQ2d 1641, 1646-47 (1998). Traditional contract law principles are applied when determining whether a commercial offer for sale has occurred. See Linear Tech. Corp. v. Micrel, Inc., 275 F.3d 1040, 1048, 61 USPQ2d 1225, 1229 (Fed. Cir. 2001), petition for cert. filed, 71 USLW 3093 (July 03, 2002) (No. 02-39); Group One, Ltd. v. Hallmark Cards, Inc., 254 F.3d 1041,1047, 59 USPQ2d 1121, 1126 (Fed. Cir. 2001) ("As a general proposition, we will look to the Uniform Commercial Code (‘UCC’) to define whether … a communication or series of communications rises to the level of a commercial offer for sale.").
"[T]o be ‘on sale’ under § 1.2(b), a product must be the subject of a commercial sale or offer for sale," and to be a commercial sale it must be "one that bears the general hallmarks of a sale pursuant to Section 2-106 of the Uniform Commercial Code." Medicines Co. v. Hospira, Inc., 827 F.3d 1363, 1364 119 USPQ2d 1329, 1330 (Fed. Cir. 2016) (en banc). The court in Medicines Co. went on to explain "[s]ection 2-106(1) of the Uniform Commercial Code describes a ‘sale’ as ‘the passing of title from the seller to the buyer for a price.’ U.C.C. § 2-106(1). The passage of title is a helpful indicator of whether a product is ‘on sale,’ as it suggests when the inventor gives up its interest and control over the product." Id. at 1375, 119 USPQ2d at 1338. The Medicines Co. court held "a contract manufacturer’s sale to the inventor of manufacturing services where neither title to the embodiments nor the right to market the same passes to the supplier does not constitute an invalidating sale under § 1.2(b)." Id. at 1381, 119 USPQ2d at 1342.
Even a single sale or offer to sell the invention may bar patentability under pre-AIA 35 U.S.C. 102(b). Consolidated Fruit-Jar Co. v. Wright, 94 U.S. 92, 94 (1876); Atlantic Thermoplastics Co. v. Faytex Corp., 970 F.2d 834, 836-37, 23 USPQ2d 1481, 1483 (Fed. Cir. 1992).
"[T]he mere sale of manufacturing services by a contract manufacturer to an inventor to create embodiments of a patented product for the inventor does not constitute a ‘commercial sale’ of the invention." Medicines Co. v. Hospira, Inc., 827 F.3d 1363, 1373 119 USPQ2d 1329, 1336 (Fed. Cir. 2016) (en banc). The court in Medicines Co. further stated that "commercial benefit—even to both parties in a transaction—is not enough to trigger the on-sale bar of § 1.2(b); the transaction must be one in which the product is ‘on sale’ in the sense that it is ‘commercially marketed.’" Id. at 1373-74, 119 USPQ2d at 1336-37.
"Only an offer which rises to the level of a commercial offer for sale, one which the other party could make into a binding contract by simple acceptance (assuming consideration), constitutes an offer for sale under §1.2(b)." Group One, Ltd. v. Hallmark Cards, Inc., 254 F.3d 1041,1048, 59 USPQ2d 1121, 1126 (Fed. Cir. 2001).
"It is not necessary that a sale be consummated for the bar to operate." Buildex v. Kason Indus., Inc., 849 F.2d 1461, 1463-64, 7 USPQ2d 1325, 1327-28 (Fed. Cir. 1988) (citations omitted). See also Weatherchem Corp. v. J.L. Clark, Inc., 163 F.3d 1326, 1333, 49 USPQ2d 1001, 1006-07 (Fed. Cir. 1998) (A signed purchase agreement prior to the critical date constituted a commercial offer; it was immaterial that there was no delivery of later patented caps and no exchange of money until after critical date.).
B. Inventor’s Consent to the Sale Is Not a Prerequisite To Finding an On Sale Bar