US President signs, seals and delivers US patent reform

US President Barack Obama signed the Leahy-Smith America Invents Act into law on September 16, making the most significant reform of US patent law since 1836.

The House of Representatives approved HR 1249, which has identical provisions to the America Invents Act, on June 23, and the US Senate voted in favour of reforming US patent law on September 8.

The America Invents Act will move the US from a first-to-invent patent system to a first-to-file, bringing it in line with other major jurisdictions, aft er March 16, 2013.

In a blog post announcing the passage of the America Invents Act into law, Quentin Palfrey, senior advisor to the Chief Technology Office for Jobs & Competitiveness in the White House Office of Science & Technology Policy, said: “The new law...will harmonize the American patent process with the rest of the world to make it more efficient and predictable, and make it easier for entrepreneurs to simultaneously market products in the United States and for exporting abroad.”

“[This] marks the conclusion of a long and vigorous debate on how to best modernize our nation’s patent system,” said Biotechnology Industry Organization (BIO) president and chief executive officer Jim Greenwood on September 8, following the Senate’s approval of the act. “The improvements made by the bill will benefit all sectors of the national economy by enhancing patent quality and the efficiency, objectivity, predictability and transparency of the U.S. patent system.”

Horacio Gutierrez, corporate vice president & deputy general counsel at Microsoft, agreed in a blog post. He said that patent reforms will ensure that innovators can benefit from a predictable and rational patent system, “with new tools to eliminate patents that should not have issued and to speed the processing of patents that should be issued”.

He added: “A fair, balanced and effective patent system is indispensable to promoting R&D investment, job creation, and economic growth.”

Fees

The US Patent and Trademark Office (USPTO) is now allowed to set its own fees, but the office’s use of fees will be subject to a limit set by Congress. Any fees collected in excess of the amount that Congress appropriates will be held in a special account for USPTO use, if and when Congress sets a new limit.

The America Invents Act also makes changes to specific USPTO fees. A 15 percent surcharge now applies to general statutory and maintenance fees, and applicants can now request a prioritised examination for an additional $4,800, which will be reduced by 50 percent for small entities.

Speaking on September 8, David Kappos, director of the USPTO, said: “Significantly, as stated by leadership in both houses of Congress, this legislation enables us to access all of our fees. We intend to aggressively implement that mandate by immediately hiring new examiners, instituting new patent acceleration tools, and aggressively modernizing our IT infrastructure.”

Post-grant review

A new post-grant review system will become operational on September 16, 2012. It will only be available for patents that are involved in interferences, certain business method patents and patents that are filed under the first-to-file system.

The USPTO’s Board of Patent Appeals and Interferences will become the Patent Trial and Appeal Board (PTAB) and the PTAB will handle cases under the new post-grant review system.

Those looking to use the current inter partes request system will have to meet a new standard when filing a request. A requesting party now needs to show that there is a reasonable likelihood that it would successfully challenge at least one of the patent’s claims, rather than raise a substantial new question of patentability as it did before.

The America Invents Act has also limited the issuance of claims directed to human organisms, removed failure to disclose best mode as a defence against litigation actions and limited the joinder of unrelated accused infringers during litigation actions.