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Jul 1, 2012 (Vol. 32, No. 13)

A Practical Guide to Patent Reform

What You Need to Know Now to Be Ready for the New First-to-File System

  • The Leahy-Smith America Invents Act (AIA) represents the most significant changes to U.S. patent law since at least the 1952 Patent Act. Although the AIA included some provisions that took effect on the date of enactment (September 16, 2011) or shortly thereafter, and others that will take effect September 16, 2012, the transition to a first-to-file patent system that will begin on March 16, 2013, will have the most profound impact on patent applicants.

    You’ve heard the hype, but what do you need to know now—and what can you do now—to prepare for patent reform? This overview highlights some of the key points and key action steps that biotechnology companies can implement now to position themselves for the new first-to-file system.

  • Patent Application Strategies

    The first-to-file provisions are embodied in a new version of 35 USC § 102, which sets forth new definitions of prior art and new prior art exceptions. Importantly, applicants will no longer be able to “swear behind” third-party prior art by proving an earlier date of invention.

    Additionally, published U.S. and PCT applications that designate the U.S. will be citable as prior art as of any foreign priority date (rather than as of their earliest U.S. filing date). This means that there could be significantly more prior art available against a given application than there would have been under the current law. While applicants cannot do anything to prevent this change in the law, there are several steps that applicants can take to minimize the impact of the transition to a first-to-file system.

    The new version of § 102 will only apply to patent applications that include a patent claim that has an effective filing date of March 16, 2013 or later. This means that applications filed up to March 15, 2013, will fall under the current, first-to-invent patent system. Biotechnology companies should discuss this date with their inventors and research and development teams, and review invention disclosures to identify inventions that may be ready for patenting by this date.

    Because this date may be associated with a new patent application “bubble,” companies should work closely with patent counsel to ensure that ample time is allotted to prepare and file complete applications by March 15, 2013. Companies also should consider budgeting for more patent application filings than unusual in the time period leading up to March 15, 2013.

    Continuation and divisional applications filed on or after March 16, 2013, will remain under the current first-to-invent system, as will new U.S. applications that claim priority to earlier-filed foreign or PCT applications, as long as all claims are entitled to a priority date of March 15, 2013 or earlier. This means that biotechnology companies do not need to identify or file all possible continuation or divisional applications by March 15, 2013.

    Once the first-to-file version of § 102 takes effect, it may be important to segregate subject matter that has an effective filing date of March 15, 2013 or earlier from subject matter that has an effective filing date of March 16, 2013 or later. This is because presenting even a single claim that has an effective filing date of March 16, 2013 or later will bring the entire patent application under the first-to-file system.

    This situation may arise with applications that straddle March 16, 2013 (e.g., applications with a priority date of March 15, 2013 or earlier and a subsequent filing date of March 16, 2013 or later with added subject matter), such as provisional/nonprovisional applications and parent/continuation-in-part (CIP) applications. Biotechnology companies may want to review provisional applications filed since March 16, 2012, to determine whether nonprovisional applications can be filed by March 15, 2013, even if the provisional year has not expired.

    After March 16, 2013, biotechnology companies may want to consider filing parallel applications—one only with claims that have an effective filing date of March 15, 2013 or earlier, and one with claims that have a later effective filing date­—in order to preserve the first-to-invent provisions for subject matter with an earlier effective filing date.

  • Invention Disclosure Strategies

    Biotechnology companies should be educating their inventors, research and development departments, and business development teams of the importance of securing an early effective filing date under the first-to-file system. Biotechnology companies may want to consider reviewing their current invention disclosure policies and procedures to ensure that they facilitate prompt identification of inventions that are ready for patenting, and support streamlined mechanisms for preparing and filing patent applications with robust disclosures that will support the claimed invention.

    Inventors who are accustomed to disclosing first and then filing a U.S. patent application within one year of publication should be aware of the risk that an intervening third-party disclosure or third-party patent application will completely bar a patent under the new first-to-file system.

    Biotechnology companies should dispel any misconceptions that the new version of § 102 is a “first-to-disclose” system such that it might be advantageous to publicly disclose the invention before filing a patent application. While new § 102(b) provides that certain third-party disclosures or third-party patent applications may not qualify as prior art if the disclosed subject matter already had been disclosed by an inventor or by another who obtained the subject matter directly or indirectly from an inventor, this exception may be difficult to establish, and may not protect the full scope of the invention being claimed. As now, any disclosure before a patent application is filed also may preclude foreign patent rights.

    Biotechnology companies may also want to consider expanding their pre-publication screening policies to include offers for sale and public uses anywhere in the world. This is because these acts can constitute prior art under the new version of § 102 even if they do not take place in the U.S.

  • Record-Keeping Strategies

    While some companies hoped that the change to a first-to-file system would mean that they could be less rigorous about their recordkeeping, several provisions of the new law may warrant even more detailed record-keeping programs.

    In order to invoke the prior art exceptions of new § 102(b)(1)(B) or (b)(2)(B), an applicant will have to establish that the subject matter at issue already had been publicly disclosed by the inventor, or by another who obtained the subject matter directly or indirectly from the inventor. This means that applicants may need to maintain detailed records of any public disclosures, including what subject matter was disclosed and who was in the audience.

    Details about the subject matter disclosed may be required to show that it corresponds to the third-party disclosure at issue, while identification of the audience may be required to show that a disclosure was made by someone who obtained the subject matter from the inventor. As many companies may not be maintaining these types of records at present, new policies and procedures may be required to ensure that such records are available.

    Indeed, it could be important to start maintaining such records now, in case it becomes necessary to invoke a prior art exception for an application filed after March 16, 2012, but within one year of a disclosure made before March 16, 2013.

    There also are reasons to continue good laboratory notebook practices. For example, CIP applications filed on or after March 16, 2013, still may be subject to the “interference” provisions of 35 USC § 102(g). For such applications, laboratory notebook evidence may be as important as ever. Additionally, evidence of independent invention may be required to establish or defend a derivation claim under new 35 USC § 135, which will require proof that the other inventor “derived the claimed invention from an inventor named in the petitioner’s application.”

    Moreover, evidence of independent invention may be useful to establish that your public disclosure or patent application disclosure qualifies as prior art against another application, and was not “obtained . . . directly or indirectly” from the inventors of that application under new § 102(b)(1)(A) or (b)(2)(A). Furthermore, laboratory notebooks can be useful during inventorship determinations, particularly if disputes arise as to inventorship.

  • Preparing To Prevail

    This overview is not exhaustive, but highlights some of the steps that biotechnology companies should consider taking before March 16, 2013, to prepare for the transition to a first-to-file system. By taking the time to understand the intricacies and implications of the first-to-file provisions now, biotechnology companies can review and revise their existing policies and procedures, and position themselves for patenting under the new law.


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