1. America Inventors Act:
Recent Changes to U.S. Patent Law and
Practice
University of Washington School of Law
Advanced Patent Law P545
Gary M. Myles, Ph.D.
February 6, 2012

2. Introduction
• Patent Reform Act of 2011 (a/k/a
“Leahy-Smith America Invents Act”)
– Signed into Law by President Obama on
September 16, 2011
– Most significant change in U.S. patent law since
U.S. Patent Act of 1952

3. Goals of the Act
• “Enhance and encourage innovation
that improves American
competitiveness, economic prosperity
and job growth.” USPTO Commissioner Stoll
• International harmonization
– Refined definition of prior art
– Replace first-to-invent with first-inventor-to-file
• Improve the quality of patents
– Third-party pre-grant submissions
– Changes to post-grant review

4. America Invents Act
Timing: Effective Immediately

5. Prior User Rights
– State Street Bank v. Signature Financial Group
(CAFC 1998)
– Court affirmed USPTO and rejected theory that
“method of doing business” was excluded subject
matter
– Prior User Defense (Nov. 29, 1999)
– 35 USC § 273
– It shall be a defense to an action for infringement under
section 271 of this title with respect to any subject matter that
would otherwise infringe one or more claims for a method [[of
doing or conducting business]] in the patent being asserted
against a person, if such person had, acting in good faith,
actually reduced the subject matter to practice at least 1 year
before the effective filing date of such patent, and
commercially used the subject matter before the effective filing
date of such patent.

6. Prior User Rights
– Prior User Rights
• Extends existing defense for business method patents
to all patents where accused infringer demonstrates
– Reduction to practice
– Commercial use
– One year before patent’s effective filing date

7. Best Mode Requirement
– Patents not invalid/unenforceable where fail to
disclose a best mode

8. Ex parte Re-exam
– Ex parte re-exam remains, but appeals now are
directly to the Federal Circuit

9. False Marking and Virtual Marking
– False Marking and Virtual Marking
• False marking claim requires competitive injury
• Expired patent number not false marking
• Virtual marking OK
– Associate product/service with internet
address containing patent number

10. America Invents Act
Timing: 10-days After Enactment
(September 26, 2011)

11. USPTO Fee-setting Authority
• Most PTO fees increase by 15%
• Microentity status gets 75% reduction in fees
– Individual inventors and small entities with no more
than four of their own US patent applications, less
than median household income, and no obligation
to assign/license to a non-micro entity
– Institutions of higher education
• Prioritized examination for $4,800 ($2,400 small entity)
– 4 independent/30 total claims

12. America Invents Act
Timing: 12-months After Enactment
(September 16, 2012)

13. Current Options for Post-Grant Patent
Review through the PTO
• Reissue
– Available only to patentees
– Used to correct errors in specification or
drawings, or to change scope of claims
• Can broaden claim scope within two years of
issuance
• Can narrow claim scope at any time during
life of patent

14. Current Options for Post-Grant Patent
Review through the PTO
• Ex parte and Inter partes Reexamination
– Available to patentees and to 3rd parties
– Analysis of issued patent
• Based on substantial new question of patentability
• Based only on patents and printed publications
• Only relevant to claims
• Claims cannot be broadened
• Brought at any time during enforceability of patent

15. Third-party Submissions
– Pre-issuance, third-party submissions of prior art
• Showing of relevance + fee
• Timing restrictions, earlier of:
– Notice of Allowance, or
– Later of
» 6-months post publication, or
» Date of first rejection

16. Post-grant review
• Post-grant review
– Third-party can challenge patent within 9-months of
issuance
– Not limited to invalidity based on prior art
– Only for first inventor to file patent applications

17. Recent Changes to Post-Grant Review
• General Provisions
– Proceeding before the PTAB to review patent
validity
– Based on any available patentability ground
• contrast with current reexamination – based on
patents and printed pubs
– Patentee can cancel claims or add claims to
substitute challenged claims
– Claim scope cannot be broadened; no new matter
may be introduced

18. Recent Changes to Post-Grant Review
• Timing
– Initiated within nine months of issuance of
patent/reissue
– Review completed within one year
• possible six-month extension for cause
– Cannot be initiated if petitioner has brought civil
action alleging invalidity

19. Recent Changes to Post-Grant Review
• Threshold showing to initiate action
– More likely than not that at least one of
the claims is unpatentable or
– Raises novel/unsettled legal question
important to other patents/apps

20. Inter partes review
• Inter partes review
– After post-grant review period
– Initiated by third-party where “reasonable
likelihood” of prevailing
• Replaces “substantial new question of
patentability” standard
– Patent Trial and Appeal Board must complete
within 18 months

21. Recent Changes to Inter Partes Review
• General Provisions
– Proceeding before PTAB to review patent validity
• Replaces inter partes reexamination
• ex parte reexamination remains
– Basis limited to patents or printed publications and to issues
of novelty/obviousness under 35 U.S.C. §§ 102/103
– Patentee can cancel claims or add claims to substitute
challenged claims
– Claim scope cannot be broadened; no new matter may be
introduced

22. Recent Changes to Inter Partes Review
• Timing
– Life of patent after later of nine months from issuance
or termination of post-grant review
– Review completed within one year
• possible six-month extension for cause
– Cannot be initiated if petitioner has brought civil action
alleging invalidity
– Proceeding cannot be initiated if petition is filed more
than six months after petitioner is served with
complaint alleging infringement of patent

23. Recent Changes to Inter Partes Review
• Showing
– Reasonable likelihood petitioner would prevail
with respect to at least one claim

24. Benefits of Changes
• Post-Grant Review Procedures
– Broaden scope of review by PTO (as opposed to courts)
– Reduce costs to challenge patents
– Increase patent quality
– Expedite PTO review process
– Encourage early review and analysis by affected parties

25. Failure to Obtain Advice from
Counsel
• Failure to Obtain Advice from Counsel
– No longer grounds to find that a party
willfully infringed or intended to induce
infringement of a patent
– Codifies Seagate (CAFC)

26. Errors in Inventorship
• Errors in Inventorship
– No longer grounds for holding patent
unenforceable if error is remedied at any
time w/ supplemental/corrected
declaration of inventorship

27. America Invents Act
Timing: 18-months After Enactment
(March 16, 2013)

28. First-Inventor-to-File
• First-to-Invent v. First-Inventor-to-File
First-to-Invent
Conception RTP File App
Jan. 1, 2013 Jan. 10, 2013 Jul. 1, 2013
Conception RTP File App
Feb. 1, 2013 Feb. 10, 2013 May 1, 2013
First-Inventor-to-File

29. First-Inventor-to-File
• First-Inventor-to-File
• 35 U.S.C. § 102(a)-(g) replaced with § 102(a)-(d)
• Almost absolute novelty requirement
• One year grace period for any inventor
publication, public use, offer for sale, or sale
in the U.S.
• Does not apply to third party disclosures,
unless after inventor’s disclosure w/in one
year grace period

30. First-Inventor-to-File
• First-Inventor-to-File
• 35 U.S.C. § 102(a)(1) replaces § 102(a) and
(b)
– Defines prior art
• 35 U.S.C. § 102(a)(2)
– Defines “derived” prior art
• 35 U.S.C. § 102(b)(1) identifies exceptions to
prior art under § 102(a)(1)

31. Prior Art

32. Prior Art
HISTORICALLY – the limits on 102 (i.e., the public policy reasons)
for determining “use” or “on-sale” “in this country” were tied to what
was feasible for an inventor to determine in an era of limited
communications around the world.
EFFECT –
“Use”, “on sale” or “available to the public” under the Act
now extends this implied knowledge to anywhere in the world.
In this internet age, this does not seem to be such an
onerous burden.

33. Prior Art
(a) NOVELTY; PRIOR ART. – A person shall be entitled
to a patent unless –
(2) the claimed invention was described in a patent
issued under section 151, or in an application for
patent published or deemed published under section
122(b), in which the patent or application, as the case
may be, names another inventor and was filed before
the effective filing date of the claimed invention.

34. Prior Art
• Overall effect –
– SECRET PRIOR ART –
• Historically related to 102(e) – a U.S.
national application.
• Under the Act – Extends to foreign
filings

35. Prior to the CREATE Act
• Historical Context
– In re Bass, 474 F.2d 1276 (CCPA 1973)
– In re Clemens, 622 F.2d 1029 (CCPA 1980)
– Kimberly-Clark Corp. v. Johnson & Johnson, 745 F.2d
1437 (CAFC 1984)
• Non-public, confidential disclosures may be prior
art under 35 U.S.C. § 102 (g) (prior invention) for
validity challenges under 35 U.S.C. § 103
35 2/9/2012

36. Prior to the CREATE Act
• Historical Context, cont.
– 1984 Amendment to 35 U.S.C.
• Excluded from the prior art, for purposes of an
obviousness challenge, subject matter
communicated between intra-institutional
research collaborators which qualifies as prior
art only under 102(f) or (g), when:
– At the time of invention
– Subject matter and the claimed invention were
» Owned by the same person, or
» Subject to an obligation to assign the same
person
36 2/9/2012

37. Prior to the CREATE Act
• Historical Context, cont.
– Oddzon Products v. Just Toys, Inc., 112 F.3d 1396
(CAFC 1997)
• Non-public communications between inter-
institutional research collaborators, where no
right of ownership existed in a single institution,
could be used as prior art under 35 U.S.C. §
102(f) (derived from another) to challenge
patent validity under 35 U.S.C. § 103
37 2/9/2012

38. The CREATE Act
• Cooperative Research and Technology
Enhancement (CREATE) Act of 2004
– Rectifies the OddzOn ruling by excluding
from the prior art, for the purposes of an
obviousness challenge, “secret” prior art
resulting from inter-institutional research
collaborations so long as there is a pre-
existing (and conforming) agreement
38 2/9/2012

39. The CREATE Act
• 35 U.S.C. § (c)(1)
– Subject matter developed by another person
– Qualifies as prior art only under 35 U.S.C. §
102(e)(secret), (f)(derived from another), or (g)(prior
invention)
– Shall not preclude patentability under 35 U.S.C. § 103
where
• Subject matter and claimed invention
• At the time the claimed invention was made
• Owned by the same person or subject to an
obligation of assignment to the same person
39 2/9/2012

40. The CREATE Act
– 35 U.S.C. § 103(C)(2)
– “Owned by the same person”
• Subject matter developed by another person and a
claimed invention are deemed owned by the
same person or subject to an obligation of
assignment to the same person if:
– (A) Claimed invention was made by or on behalf of
parties to a joint research agreement (JRA) in effect on
or before the date the claimed invention was made;
– (B) Claimed invention was made as a result of activities
undertaken within the scope of the JRA; and
– (C) Application for patent for the claimed invention
discloses parties to the JRA
40 2/9/2012

41. The CREATE Act
– 35 U.S.C. § 103(C)(3)
– “Joint Research Agreement”
• “[A] written contract, grant, or cooperative
agreement entered into by two or more
persons or entities for the performance of
experimental, developmental, or research
work in the field of the claimed invention.”
41 2/9/2012

42. Changes Brought on by the AIA
• 35 U.S.C. § 103 Amended to Remove 103(c)
• New 35 U.S.C. § 102 Includes 102(c)
– Common Ownership Under JRAs
• Subject matter disclosed and claimed invention
deemed owned by same person in applying
102(b)(2)(C) (i.e., prior art exclusion provisions) if:
– Subject matter disclosed and claimed invention
made by parties to a JRA in effect as of the
effective filing date of the claimed invention;
– Claimed invention made within scope of JRA; and
– Patent application for claimed invention discloses
parties to JRA
42 2/9/2012

43. Best Practices after the AIA
• Joint Research Agreements
– Content
• Must describe general scope of research that encompasses
later claimed invention
– Timing
• Must execute JRA prior to effective filing date of patent
application disclosing claimed invention
• Patent Applications
– Must disclose parties to the JRA
• Unintended consequences of a pre-JRA non-disclosure agreement
(NDA)
– Does not offer the prior art protections of a properly
drafted and executed JRA
– For large companies, may open the door for
impropriety challenges
43 2/9/2012

44. Derivation Proceedings
– Derivation proceedings under 35 U.S.C. § 135
• Replace interferences
• Heard by Patent Trial and Appeal Board

45. Strategic Considerations
• Promptly file manuscripts and invention
disclosures as provisional patent applications to
establish early effective filing date
• Use virtual marking on company web site to
associate products/services with patent portfolio
• Survey patent landscape to monitor for pre-
issuance submission and post-grant review
opportunities
• Consider impact of pre-filing publication within
one year grace period on international patent
applications

46. Stanford v. Roche
583 F3d 832 (CAFC 2010)
• 1985
– Cetus develops PCR methods for quantifying HIV
levels in blood
• 1988
– Cetus begins collaboration with a laboratory within
Stanford’s Department of Infectious Diseases to test
new AIDS drugs
– Inventor (Dr. Holodniy)
• Joins Stanford laboratory as a research fellow
• Signs Copyright and Patent Agreement where he
“agrees to assign” to Stanford his “right, title and
interest in” inventions resulting from his
employment at the University

47. Stanford v. Roche
583 F3d 832 (CAFC 2010)
• Inventor begins work on quantifying HIV levels in
blood using PCR
• Inventor is unfamiliar with PCR technology so he
performs research at Cetus with Cetus employees
• Cetus requires that Inventor sign a Visitor’s
Confidentiality Agreement
– Inventor “will assign and does hereby assign”
to Cetus his “right, title and interest in each of
the ideas, inventions and improvements”
made “as a consequence of [his] access” to
Cetus

48. Stanford v. Roche
583 F3d 832 (CAFC 2010)
• Inventor works with Cetus employees to develop
testing method
• Inventor returns to Stanford
– Continues to work on testing method with
support from an NIH grant
– Stanford reports finding to the NIH and elects to
retain title
– Stanford obtains three patents on inventor’s
work

49. Stanford v. Roche
583 F3d 832 (CAFC 2010)
• 1991
– Roche acquires Cetus PCR business including rights
under Visitor’s Confidentiality Agreement
– Roche produces commercial test
• 2005
– Stanford sues Roche for patent infringement
• 2010
– Federal Circuit holds
• Stanford’s “agrees to assign” language within its
Copyright and Patent Agreement does not constitute
a current assignment
• Cetus’ “will assign and does hereby assign” does
constitute a current assignment

50. Stanford v. Roche
563 U.S. __ (SCOTUS 2011)
• 2010
– Stanford appeals to U.S. Supreme Court
– Question Presented for Certiorari
• "Whether a federal contractor university’s
statutory right under the Bayh-Dole Act, 35
U.S.C. §§ 200-212, in inventions arising from
federally funded research can be terminated
unilaterally by an individual inventor through a
separate agreement purporting to assign the
inventor’s rights to a third party.”

51. Stanford v. Roche
563 U.S. __ (SCOTUS 2011)
• 2011
– Supreme Court upholds time-honored tenet of
patent law that an inventor owns rights to his/her
invention
– Bayh-Dole Act does not affect inventor’s
ownership rights
– Breyer dissent
• Stanford should retain title because “patent law
appears to have long specified that a present
assignment of future inventions (as in both
contracts here) conveyed equitable, but not
legal, title.”

52. Questions & Answers