American Invents Act

Summary of Key Provisions and associated Effective Dates

On September 16, 2011, President Obama Signed the Patent Reform Act of 2011, (also referred to as AIA or the American Invents Act) into law.  The Act made the most significant changes in US patent law since the 1952 Patent Act.  The stated purpose was that the changes were made to harmonize the US system with patent systems around the world and to address 3rd party demands.   While, I don’t believe the US Patent system needed to be downgraded, (which is the model which most other country’s attempt to emulate based upon the innovation which the US is known for) just because everyone else does it the wrong way.   Below is a summary of some of the most controversial provisions.

  • First Inventor to File.

Changes from a “first-to-invent” to a “first-inventor-to-file” patent system while maintaining a 1-year grace period for disclosures by the inventor.  Prior to this change, the US was the only country which rewarded the first true inventor, rather than the inventor who was first to rush to the Patent Office.

  • Post-Grant Review Proceedings.

(i) Replaces “optional interpartes reexamination” with “interpartes review” to be conducted by Patent Trial and Appeal Board within 1 year. The threshold showing is “reasonable likelihood” that the petitioner will prevail based on published prior art. The estoppel standard is “raised or reasonably could have raised” before the USPTO and the courts. Appeals are directed to the Federal Circuit.

(ii) Establishes a “post-grant review” before the Patent Trial and Appeal Board to review validity of issued patents within 9 months of grant on any patentability issue. The threshold showing is “more likely than not” that at least 1 claim is unpatentable. The estoppel standard is “raised or reasonably could have raised” before the USPTO and the courts.

(iii) Establishes an 8-year transitional post-grant review proceeding for review of the validity of business method patents for financial products or services by defendants accused of infringement.

(iv) Allows a pre-issuance submissions procedure for published prior art but not public, use, sale or improper inventorship, which current 35 U.S.C. 122(c) continues to provide for. Submission must be made before the earlier of (a) allowance, or (b) later of 6 months after the date of application publication or the date of first rejection.

  • USPTO’s Fee Setting Authority and Funding.

Give the Director fee setting authority to cover operating and administrative costs. This authority is subject to a 7 year sunset clause.  A recent article by J. Michele suggests that Congress’s continued siphoning of funds from the USPTO is a principle cause for the backlog if left unchallenged may lead to the ruin of the US Patent system, notably one of the world’s premier patent systems.

It should be noted that the effective dates of the key provisions of the act differ.  For instance, the USPTO’s Fee setting Authority took effect immediately after the passage of the act, while the “first-inventor-to-file” provision takes effect 18 months after the passage of the Act for patents and applications with a claim having an effective date on or after September 16, 2011.  The USPTO has provided a document further explaining the Key Effective Dates.

  • Summary of Key Effective Dates

In summary, there appears to be four dates of significant importance: September 16, 2011 (the date of passage), September 26, 2011 – November 16, 2011, September 16, 2012 (one year after passage) and March 16, 2013 (eighteen months after passage).

Some of the provisions which went into effect on September 16, 2011 include: the Prior user defense for patents issued on or after 9/16/11, Standard for inter parties reexam changes to “reasonable likelihood,” CAFC assumes jurisdiction for appeals to patentablity, Micro-entity provisions (§123), Funding agreement provisions, Tax strategies deemed to be within prior art for pending patent applications and issued patents, Best mode provisions, Patent marking provisions and jurisdictional provisions for any civil actions.

From the time period from September 16, 2011 thru November 16, 2011 the USPTO will begin charging a surcharge for paper filings (after November 16, 2011) and allowing prioritized examination with payment of surcharge (after September 26, 2011).

Beginning one year after enactment of the legislation (September 16, 2012) a number of key provisions go into effect related to: inter parties review (§311 – §310); post grant review process (§321-329); the new PTAB provisions; the pre-issuance third party submissions (§122); Supplemental patent examination; Advice of Counsel defense for willful infringement; business method patents, prioritized examination for “important technologies,” along with a number of technical amendments, including changes to reissued patents.

Finally, on March 16, 2013 the new §102 and §103 including the first to file rule go into effect.