ROBIC Special Report on AIA 2013

2013-02-26

BePrepared!MajorChangestoU.S.PatentLawComingintoEffect
onMarch16,2013

ROBICSPECIALREPORT
CompiledbyIsabelleGirard
WrittenbyPhilipConrad,A.SashaMandyandDominiqueNolet

U.S.patentlawhasbeenundergoingahistorictransitionsincePresidentBarackObama
signedtheAmericaInventsAct(AIA)onSeptember16,2011.

Overthepast18months,variousprovisionsofthenewlawhavecomeintoeffect,suchasa15%
increaseinUSPTO(UnitedStatesPatentandTrademarkOffice)fees,awiderrangeofoptionsfor
interveningwiththeExaminerinchargeofexaminingacompetitor’spatentapplication,andthe
implementationofanewaccelerationprocedureforexamination.However,themostsignificant
changetobebroughtaboutbytheAIAwilloccurthisMarch16,whenU.S.patentlawwillswitch
froma“firsttoinvent”toa“firsttofile”system.

ThepatentprofessionalsatROBIChavepreparedtheenclosedspecialreport,summarizingthe
potentialimpactofthistransitiononCanadianapplicantswishingtoobtainpatentprotectionfor
theirinventionsintheU.S.Apartfromthenew“firsttofile”system,ourreportexaminesthenew
mechanismsputinplacebytheAIAtochallengethevalidityofanissuedU.S.patent.Finally,we
analyzethenewUSPTOfeeschedulewhichwilltakeeffectonMarch19,andexplaintheimpact
ofitschangesonyourpatentportfolio.

ThedetailsofthechangesbroughtaboutbytheAIAarecomplex,anditwilltakeseveralyears
beforetheconsequencesofthisreformarefullyunderstood.However,theredoesseemtobea
consensusamongmostpatentprofessionalsthatitisprobablybeneficialformostpatent
applicantstotakeadvantageofthecurrent“firsttoinvent”system,ifpossible.Wethereforeinvite
youtocontactourpatentagentstodiscusstheprotectionofanyinventionsforwhichyouhavenot
yetinitiatedpatentproceduresintheU.S.Theclockisticking;itmayindeedbeinyourbest
interesttospeedupthepreparationandfilingofnewpatentapplicationsbeforetheMarch16,
2013deadline.

Wehopethisreportishelpfultoyou,andremainavailabletoansweranyquestionsyoumayhave
onthisimportantreform.

byPhilipConrad

PerhapsthemostimportantchangeoftheAIA,thenewpatentlawintheUnitedStates,isthe
conversionoftheU.S.froma“first-to-invent”systemtoa“first-to-file”system,whichwilltakeplace
onMarch16,2013.

Asthisdateapproaches,thosewhomakeuseoftheU.S.patentsystemwouldbewell-advisedto
revisittheirgeneralpatentapplicationfilingstrategies,andtodeterminewhichsystemwouldbe
mostbeneficialforpatentapplicationstobefiledinthenearfuture.Since,withcertainexceptions,
applicationsfiledbeforeMarch16willfallundertheoldsystem,andapplicationsfiledonorafter
March16willfallunderthenewsystem,makingaproactivedecisionregardingwhentofileany
projectedpatentapplicationswillallowapplicantstochoosethesystemmostadvantageousto
them.

Thedetailsofthenewlegislationarecomplicated,evenforpatentlawprofessionals.Certain
sectionsoftheAIA,andthemannerinwhichtheywillbeimplemented,stilllackclarity,soany
decisiontakenatthisstagewillcarrysomeuncertainty.Moreover,unlikethecurrentlaw,thereare
notyetanycourtdecisionsonwhichtobaseaninterpretationofthenewprovisions,anditmay
takeyearsbeforeabodyofcaselawisdeveloped.Therearenonethelesscertainfactorsupon
whichsuchadecisionmaybebased,includingthefollowing:

•Alimitedone-yeargraceperiodwillremainforfilingapplicationsafterpublicdisclosureof
theinvention,butitwillbelimitedtodisclosuresbytheinventor,andwillnotbroadlycoverthird-
partydisclosures.Thus,whileinventorswhodisclosetheirinventionpubliclywillstillhaveayear
withinwhichtofileaU.S.patentapplication,mostthird-partypublicationswillbeconsideredprior
art,ifpublishedanytimepriortothefilingdate.

•Publicuses,sales,offersforsale,etc.,whicharecurrentlyconsideredpriorartonlyifthey
occurintheUnitedStates,willnolongerhavegeographiclimitations.Instead,theseactivitiesmay
constitutepriorartnomatterwhereintheworldtheyoccur.However,itremainsunclear,atthis
point,whetherornotaprivateuseorsaleofaninventionbeforethefilingofapatentapplication
couldstillbeconsideredabartoitspatentability.

•ThescopeofpriorarthasbeenexpandedbyusingtheforeignprioritydatesofU.S.
patents,U.S.patentapplicationpublications,orPCTpublicationsdesignatingtheU.S.,astheir
effectivefilingdate,insteadoftheirsubsequentdateoffilingintheU.S.

•Undercertaincircumstances,commonownershiporappropriatejointresearchagreement
provisionsdirectedtoaninventionwillbeapplicableunderthenewlawtoovercomeanticipation
aswellasobviousnessrejections,whereasunderthecurrentlaw,suchcircumstancesare
relevantonlytoovercomeobviousnessrejections.

Eachpatentcaseisunique,andmaybeaffecteddifferentlybythesechangestothelaw.Inmany
cases,itmaybebesttoavoidbeingsubjectedtothenewprovisionsbyfiling,insofaraspossible,
anynewpatentapplicationbeforeMarch16,2013.However,thefilingstrategymost
advantageoustoaparticularcasedependsonmanyfactors,suchasapriordisclosureor
commercialuseoftheinventiontobeprotected,thestageofdevelopmentoftheinvention,the
contentofanyearlierpriorityapplications,etc.

Ifyoubelievethatyoumaybeaffectedbythesechanges,weencourageyoutocontactusas
soonaspossibletodiscussyouravailableoptions.ThepatentprofessionalsatRobicare
preparedtoansweranyquestionsyoumayhave,andhelpyounavigatetheseturbulenttimesto
ensurethatyourinventionsbenefitfromthebestavailableprotection.

AnArsenaltoChallengeaPatent

ByA.SashaMandy

Switchingtoa“first-to-file”systemisnottheonlyfundamentalchangetoU.S.patentlawbeing
introducedbytheAIA.Thenewlawalsosignificantlyalterstheproceduresavailableforattacking
thevalidityofissuedU.S.patents.Hereisasummaryoftherelevantchanges.

PostGrantReview(PGR)

PostGrantReviewisabrandnewprocedurewhichallowsathirdpartytopetitiontheUSPTOto
reconsideritsdecisiontograntthepatentinlightofinformationraisedbythethirdparty(knownas
thepetitioner).Unlikeothersimilarprocedures,suchasreexamination,thepetitionercanraise
variousgroundsforobjectionbeyondlackofnoveltyorobviousness.Thus,moreammunitionwill
beavailabletoattackacompetitor’spatent.ItshouldbenotedaPGRcanonlybeinitiatedwithin
thefirstninemonthsafterissuanceofapatent,similarlytooppositionproceedingsinEurope.

Afewkeydetails:aPGRwillonlybeavailabletoattackpatentsthatarefiledafterMarch16,2013,
andthatarethereforesubjecttothefirst-to-fileconditionsofthenewlaw.Itisalsoanexpensive
endeavor–atleast$30,000inUSPTOfeesalone,whichexcludeslawyer’sfees!

InterpartesReview(IPR)

AftertheninemonthstatutoryperiodforinstitutingaPGRhaspassed,itwillstillbepossibleto
challengeanissuedpatentthroughanInterpartesReview.Thisoptionreplacedtheinterpartes
reexaminationasofSeptember16,2012.Essentially,athirdpartywillbeabletoasktheUSPTO
toreconsidertheirdecisiontograntthepatent,buttheobjectionsthatcanberaisedbythe

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petitioneraremorelimitedthanwiththePGR.ThepetitionerinanIPRcanonlyarguelackof
noveltyandobviousness,onthebasisofpriorartthatmustbeeitherapatentdocumentora
printedpublication.ApetitionermayapplyforanIPReitherafterninemonthshavepassedsince
thepatentissued,orafteraPGRforthatpatenthasterminated.RequestinganIPRwillalsohurt
yourwallet–theestimatedUSPTOfeesforthisprocedurestartat$23,000.

ItisimportanttonotethatthestandardofproofforboththePGRandIPRishigh,andthatthese
proceduresmaypreventthepetitionerfromchallengingthepatentinotherforums(e.g.courtsand
tradetribunals).Itwillthereforebeimportanttotalktoyourpatentagenttobetterunderstandthe
risksandrewardsassociatedwiththeseprocedures.

AlthoughthesechangescameintoeffectonSeptember16,2012,wewillonlyknowtheoutcome
ofthefirstPGRandIPRcasesinthenextfewmonthsandyears.Wewillthereforehavetowait
quitesometimebeforewecantrulyjudgetheimpactoftheseproceduresonpatentowners.

AIAandYourWallet:HowMuchWilltheReformCostYou?

ByDominiqueNolet

AmongthemanyconsequencesoftheAmericaInventsAct(AIA)isasignificantchangetothe
costofobtainingapatentintheUnitedStates.Thischangewaspartoftheveryfirstprovisionsin
thenewlaw,andcameintoforcewiththeenactmentoftheAIAonSeptember16th2011.This
provisiongrantstheUSPTOtheauthoritytosetitsownpatentfees,withoutrequiringtheapproval
ofCongress.ThepurposeofthischangeistoallowtheUSPTOtobecomeaself-sustainingentity
thatwillgenerateenoughrevenuetocoveritsoperatingcosts.

Itseemsthattheoverallresultofthischangewillbeanincreaseinfeespaidbypatentapplicants.
EvenbeforetheUSPTOrevieweditsfeeschedule,theAIAprovidedfora15%increaseinpatent
relatedfees,whichwasimplementedinthedaysfollowingtheenactmentoftheAIA.Inadditionto
thoseincreases,theUSPTOhasnowannouncedafirstrevisionofitsfeestructure,whichwill
comeintoeffectonMarch19th,2013.

Modificationstothefeestructure

Inanutshell,thenewfeestructureisintendedtoencouragethefilingofapplications,to
discourageanyprocedurethatwouldlengthentheexaminationprocessofanapplication,andto
ensurethatonlypatents”ofvalue”aremaintained-henceasubstantialincreaseinmaintenance
fees.

Filingfees:Patentapplicationfilingfeesarenowslightlyhigher,mostlybecauseofthe
increaseintheexaminationfee(up188%forlargeentities)

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Examinationfees:Extensionfees(whichallowanapplicantextratimetoaddressanOffice
Action)havealsoincreasedsignificantly,ashavethefeespayableforaRequestfor
ContinuedExamination(RCE)afterafinalOfficeActionhasbeenissued.

Issuance:Theonlyfeesreducedsubstantiallyinthenewfeeschedulearethoserelatingto
theissuanceofapatent.Itshouldbenotedthatthisreductionofabout50%willnotenter
intoforceuntilJanuary1st,2014.

Maintenancefees:Maintenancefeeswillseeamarkedincreasevaryingfrom25%to55%,
dependingontheyearforwhichthepaymentisdue.

Microentities:Anewmicroentitystatushasbeenintroducedinthefeeschedule,allowing
applicantstobenefitfroma75%reductiononmostfees.

Thetablebelowsummarizesthemodificationsmadetothemostcommonpatentfeespaidtothe
USPTO.

FeeScheduleoftheUnitedStatesPatentandTrademarkOffice(USPTO)
DescriptionCurrentfee
schedulesNewfeescheduleVariation(Large
Entityfees)
Large
Entity
Small
Entity
Large
Entity
Small
Entity
Micro
Entity
Variation
in$
Variation
in%
Provisionalapplicationfilingfee
Filingfee250$125$260$130$65$+10$+4%
Utility(regular)applicationfilingfees
Basicfilingfee-
Utility390$195$280$140$70$-110$-28%
UtilitySearchFee620$310$600$300$150$-20$-3%
Utilityexamination
fee250$125$720$360$180$+470$+188%
Totalforaregular
application1260$630$1600$800$400$+340$+21%
Examinationprocedure
Requestfor
Continued
Examination(RCE)
930$465$1200$600$300$+270$+29%
2eRCE(and
subsequent)930$465$1700$850$435$+770$+83%
Extensionfees
1month150$75$200$100$50$50+33%
2months570$285$600$300$150$30+5%
3months1290$645$1400$700$350$110+9%
4months2010$1005$2200$1100$550$190+9%
5months2730$1365$3000$1500$750$270+10%

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Issuancefees
–untilDecember
31st20131770$885$1780$890$445$+10$+1%
–startingJanuary
1st20141770$885$960$480$240$-810$-46%
Publicationofthe
application300$300$0$0$0$-300$-100%
Maintenancefees
3.5years1150$575$1600$800$400$+450$+39%
7.5years2900$1450$3600$1800$900$+700$+24%
11.5years4810$2405$7400$3700$1850$+2590$+54%

Anewapplicantstatus:themicroentity

ThecurrentUSPTOfeeschedulealreadyincludesa50%reductionofmostfeesforapplicants
qualifyingof“smallentities”.WiththeimplementationoftheUSPTO’snewfeescheduleonMarch
19th2013,anewcategoryofapplicants,called“microentity”,willbeaddedtotheexisting
categories.Microentitieswillbeentitledtoa75%reductiononmostbasicfees(i.e.feesfora
“largeentity”)relatedtothefiling,examination,andmaintenanceofapatent.

MicroentitystatushastechnicallybeenineffectsincetheenactmentoftheAIA,butfeediscounts
willonlyapplyasofMarch19th.Microentitystatusisapplicabletoindependentinventorswhose
netrevenueislessthanthreetimesthemedianincomeintheUnitedStates,andwhohavenot
previouslyfiledmorethanfourpatentapplications,excludingthosetheymighthavefiledforan
employer.Auniversity,oraninventorwhomustassignhisinventiontoauniversity,mayalso
benefitfrommicroentitystatus,althoughitseemsonlyAmericanuniversitieswillbeconsidered
eligible.

Ifyoubelieveyoumaybeeligibleformicroentitystatus,andyouhavepatentapplicationsor
pendingpatentsintheUnitedStates,itwouldbeadvantageoustoevaluatewhetheryoudo
indeedqualify,andmodifyyourstatusaccordingly.However,suchanevaluationmustbe
performedwithcare,sinceapplicantstatusmustbeclaimedcorrectlyeachtimeapaymentis
madetotheUSPTO.Forindependentinventors,thisdeterminationinvolvescomparinganewtheir
netrevenuewiththemedianhouseholdincomeintheU.S.Thisexercisecannotbetakenlightly,
sinceerroneouslyclaimingmicroentitystatuscanhavedisastrousconsequencesforapatent
applicationorapatent,andcanevenleadtoalossofrights.TheprofessionalsatROBICcanhelp
youevaluateyourstatuswiththeUSPTOanddeterminewhetherclaimingmicroentitystatusis
worthwhile.