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MICAH D. STOLOWITZ[1]
In this article the author considers the implementation of the Gatt treaty in the United States. Provisional applications are considered, the procedure to be adopted, the special features, advantages and pitfalls. Illustrations are provided and the author concludes with a study of the provisional provisions.
Last year saw very significant legislative activity affecting intellectual property protection in the United States. Discussed here are principle provisions of the GATT Uruguay Round Implementing Legislation, Public Law 103-465 (also called the Uruguay Round Agreements Act). Final implementing regulations, at 37 CFR, were promulgated by the U.S. Patent and Trademark Office ("PTO" or "the Office") on April 25, 1995. See Federal Register, Vol. 60, No. 79 at 20195.
In particular, this update explains the GATT implementing legislation as it affects U.S. patent law in three areas: (1) establishing a date of invention outside the United States; (2) a new 20-year patent term; and (3) a new "provisional" patent application. Additionally, critically important transitional provisions are summarized.
The Uruguay Round Implementing Legislation, P.L. 103-465, was signed by President Clinton on December 8, 1994. Most of the provisions of the legislation will take effect one year after the date on which the World Trade Organization (WTO) Agreement enters into force with respect to the United States, which was on January 1, 1995. However, the provisions relating to patent term and provisional applications, explained below, took effect six months after the signing of the bill, i.e., on June 8, 1995. Users of the U.S. patent system should be fully aware of these changes and their respective effective dates.
Regarding the treatment of "inventive activity" abroad, the GATT Uruguay Round Agreement requires that patents be made available without discrimination as to the place of invention. Under prior law, an applicant for a patent in the U.S. PTO could not establish a date of invention by "reference to knowledge of use thereof, or other activity with respect thereto, in a foreign country other than a NAFTA country, except as provided [under the Paris Convention and PCT]." 35 U.S.C. §104(a). A "NAFTA country" means Canada, the U.S. and Mexico. (Prior to NAFTA, §104 precluded establishing a date of invention based on knowledge or use anywhere outside the United States. The NAFTA agreement extended the geographic scope to include the rest of North America.)
The GATT implementing legislation further amends §104 to include all WTO member countries.[2] Thus, for an invention made in any WTO member country, this provision establishes the same right of priority as if the invention had been made in the U.S. This provision is particularly significant with respect to foreign research and development sites, joint ventures with foreign partners, and the like.
It should be noted that the definition of "prior art" under U.S. law, 35 U.S.C. §§102(a), (b) and (g) are not affected by the GATT legislation. Thus, while development and use of an invention abroad may be proven to establish a date of invention under §104, that same use outside of the United States is not "prior art" as against others as §102(a) still defines prior art as an invention that "was known or used by others in this country [the United States], or patented or described in a printed publication ."
Section 104 has also been amended to guard against the possibility that a party may be unable to probe and challenge adequately evidence of inventive activity outside the United States because the party cannot obtain other information from a person in a WTO member country relevant to an alleged date of invention to the same extent that the information could be obtained in the United States. If information cannot be obtained, the Commissioner, Court or other authority is to draw appropriate inferences in favor of the party that requested the information.[3]
This amendment applies to all patent applications that are filed on or after the date that is twelve months after the date of entry into force of the WTO Agreement with respect to the United States. Thus, it will take effect on January 1, 1996. However, the statute further provides that an applicant for a patent may not establish a date of invention for purposes of Title 35, United States Code, that is earlier than 12 months after the date of entry into force of the WTO Agreement with respect to the United States by reference to knowledge or use, or other inventive activity, in a WTO member country, except as provided in Sections 119 and 365 of Title 35. Therefore, an applicant cannot prove a date of invention earlier than January 1, 1996 by events in a WTO country, except as provided under the Paris Convention and the PCT.[4] Section 365 similarly affords the benefits of prior international application filing date.[5]
A second major feature of the GATT implementing legislation is the new provisional application. The provisional application has a variety of uses and advantages, which will be mentioned shortly. It also presents a trap for the unwary and must be used with care. It remains to be seen of course whether or not the new provisional patent application will be often used. The PTO has suggested it will be useful for individuals acting pro se to preserve patent rights, as it is relatively informal and inexpensive. It's utility, however, will depend upon timely filing of a non provisional application claiming benefit of the provisional application as explained below.
On or after June 8, 1995, the Office will accept for filing a "provisional application" pursuant to the new 35 U.S.C. §111(b). A provisional application is considered a national patent application for most purposes.[6]
A provisional application must be made or authorized by the inventor[7] and must include a specification as prescribed in §112, 1st paragraph and a drawing as prescribed in §113. No claim is required in the provisional application. It does not require a formal oath or declaration. The filing fee presently is $150 US ($75 for a "small entity" including an individual inventor). Thus, the provisional application provides a relatively inexpensive and simple procedure for obtaining a filing date.
The specification is the key. It must describe the invention thoroughly. The statute states (regarding all utility applications):
"The specification shall contain a written description of the
invention, and of the manner and process of making and using it, in
such full, clear, concise, and exact terms as to enable any person
skilled in the art to which it pertains, or with which it is most
nearly connected, to make and use the same, and shall set forth the
best mode contemplated by the inventor of carrying out his invention."
Compliance with the foregoing "enablement" and "best mode" requirements familiar to patent practitioners is every bit as important in a provisional application as in a regular or "non provisional" application filed under Section 111(a) for examination. The benefit of the provisional application -- in terms of priority over later disclosed "prior art" -- cannot exceed the scope of the specification (and drawings) of the provisional application. The provisional application cannot be amended.
The filing date of a provisional application is the date on which the specification and any required drawing are received in the Office.[8] The fee may be paid late with a surcharge. The application will be assigned a unique serial number and filing date. It is maintained in secrecy in the Office just as a non provisional application. The filing date established under §111(b) does not start the twenty year patent term (see Part III below). It does establish the date of invention for purposes of most first-to-file countries and, in particular, it provides a "priority date" under the Paris Convention. A provisional application is not entitled to the right of priority of any earlier-filed application under §119 (Paris Convention) or §365(a) (international application) or to the benefit of an earlier filing date in the United States under §120 (continuation practice) or §121 (divisional applications).
An application that is not designated as a provisional application will be treated as an application filed under §111(a) (a "regular" application). If this treatment is not in accordance with the unexpressed intent of the applicant to file a provisional application, conversion of the application to a provisional application will be permitted for a fee.[9]
It is key to remember that a provisional application is not examined.[10] Rather, a provisional application is examined only for the minimal formalities necessary to establish the filing date. After the filing receipt is issued, provisional applications will be stored in a PTO warehouse off-site. A provisional application can never itself ripen into a patent. It becomes publicly available only if and when a non provisional application claiming benefit of the provisional application actually issues as a patent.
One benefit of a provisional application is to give applicants the benefit of a "priority year" that does not start the twenty-year patent term. In this sense, the provisional application acts as an internal or "domestic priority" document, provided it is followed by a non provisional application within twelve months of the filing date of the provisional application. For the most part, provisional applications will be filed by and provide a benefit to applicants from the United States.
Second, as noted, filing a provisional application can help an applicant establish a filing date for an invention which may be useful in other countries. Additionally, the filing date of an application in the U.S. also establishes a prior art effective date under the provisions of 35 U.S.C. §102(e), again assuming that a patent ultimately issues.
Third, filing a provisional application can be an effective tool for deferring examination of an invention for a period of one year. This may be useful where an applicant wishes to seek financial assistance from third parties before the costs of prosecution begins, or the applicant who updates the contents of the application within one year of the original filing date. Thus, an applicant can add "new matter" at the time of filing a regular §111(a) application, thereby effectively presenting a CIP application for examination without paying the full (non provisional) application filing fee twice.
It must be remembered that a provisional application is not examined and can never ripen into a patent. Automatic abandonment of the application no later than twelve months after the filing date occurs by operation of law and is not subject to restoring the application to a pending status under either an unavoidable or unintentional standard. If a provisional application goes abandoned for failure to respond to a notice to pay the filing fee, for example, the provisional application would be subject to revival, but only for the limited term of 12 months from the filing date. The provisional application cannot be regarded as pending after the twelve month anniversary date.
When is the twelve month period over? In general, whenever a deadline to take action in the U.S. Patent and Trademark Office falls on a Saturday, Sunday or holiday in Washington D. C., the Applicant is permitted to take the required action on the next subsequent day which is not a Saturday, Sunday or Federal Holiday. U.S. practitioners are accustomed to routinely taking advantage of this provision, found in 37 C.F.R. § 1.7. However, the regulations are amended at 37 CFR § 1.78(a)(3) to remind applicants that when the last day of pendency of a provisional application falls on a Saturday, Sunday or federal holiday within the District of Colombia, any non provisional application claiming benefit of the provisional application must be filed prior to the Saturday, Sunday or federal holiday. This is because 35 U.S.C. § 111(b)(5) states that a provisional application is abandoned no later than 12 months after its filing date and the statutory deadline cannot be extended by regulation of the Office.
Prior to the GATT implementing legislation, patents were granted in the United States for a term of seventeen years measured from the date the patent is granted or "issued".[11] In the past, the amount of time that an application, or a series of continuing applications, was pending in the PTO was irrelevant to the term of a patent. In some cases, a string of continuing applications was pending literally for decades, before a surprising new patent came to light. Since applications generally are maintained in secrecy under U .S. law, the public had no way of knowing if or when a new patent might issue or what the scope of the claims might be.[12]
The new 20-year patent term will change not only the number of years associated with the patent grant, but more importantly, changes the date from which the patent term is calculated. The patent term henceforth will be calculated from the filing date of the subject application rather than the issue date of the patent. This general rule is subject to modification under transition rules, as well as the patent term extension statutes, discussed below.
The new patent term provision is 35 USC §154(a): "Subject to the payment of fees under this title, such grant shall be for a term beginning on the date on which the patent issues and ending twenty years from the date on which the application for the patent was filed in the United States or, if the application contains a specific reference to an earlier filed application or applications under Section 120, 121, or 365(c) of this title, from the date on which the earliest such application was filed." Priority under Sections 119 or 365 is not taken into account in determining the term of the patent. Thus, where an applicant claims the benefit or claims priority based upon an earlier-filed application (except a provisional application), the earlier filing date will mark the beginning of the 20-year term.
Referring to the drawing, illustration A simply illustrates the 17-year term beginning from the date of the grant under prior U.S. Law, as contrasted with a 20-year term commencing from the date of filing of the subject application. Where an application does not claim priority from an earlier filed case, this change may have very little practical effect. In fact, the net effect may be a slightly longer term in most cases since the average pendency of an application in the U.S. PTO presently is around 18 - 24 months.
Illustration B shows the effect of the 20-year patent term on continuing applications. The first line shows how an application filed prior to June 8, 1995 continues to receive a 17-year term measured from the date of grant. Similarly, a divisional application filed prior to the effective date of the new legislation also receives a term of 17 years measured from the date of the grant. Referring to the third horizontal line from the top in Illustration B, any divisional application filed after June 8, 1995 will have a term of 20 years measured from the earliest filing date, here the filing date of "grandparent application". Diagram C contrasts the old versus the new method of calculating the patent term for divisional applications, as explained above.
The new law will encourage prompt action by applicants and their attorneys in the prosecution of a patent application, since the time for prosecution works against the eventual term of the patent. This will increase the pressure on patent attorneys and agents to promptly respond to official actions from the PTO, whereas in the past, the initial period for response was usually set by the examiner at three months with extensions of time up to a total of six months available for payment of additional fees. The patent prosecution will not be nearly so leisurely as it has been in the past.
At the same time, attorneys and agents will be under increased pressure to secure the broadest possible scope of protection as early as possible. In the past, it was often thought advantageous to allow a case to issue even if only a relatively few or relatively narrow claims had been allowed, in order to at least get some patent protection in force. A divisional application under Section 120 was typically filed before the patent issued, in order to pursue additional protection in the form of a second patent. This had the advantage in some cases of providing an opportunity to write claims that would read on a competitor's new product and, the second patent would enjoy a full 17-year term from its date of issue. The patent law at least theoretically prevents these procedures from being used to extend the 17-year term, by requiring a terminal disclaimer under in the event of "obviousness type" double patenting.
Under prior law (prior to June 8, 1995), practitioners routinely file continuation-in-part ("CIP") patent applications. A CIP is an application that claims the benefit of an earlier-filed or "parent" application under § 120, but contains additional disclosure or "new matter." The application obtains the benefit of the earlier filing date only to the extent of the original disclosure. Thus, claims issued on the CIP application which actually are fully supported by the original disclosure, will have an "effective filing date" of the filing date of the parent case.
Conversely, claims that are supported by the "new matter" first introduced in the CIP application effectively have the actual filing date of the CIP. Under the GATT legislation, as noted, the 20-year term is measured from the date on which the earliest application was filed, or the application contains a specific reference to an earlier-filed application (or applications) under § 120, 121 or 365(c) of Title 35. Clearly, the new law exacts a penalty in the form of reduction of the patent term where the benefit of an earlier-filed case is asserted.
Some have suggested that the 20-year term of claims drawn to "new matter" in a CIP application be measured from the filing date of the CIP application, irrespective of any reference to a parent application under 35 U.S.C. §120. The Patent Office has rejected this suggestion. It asserts that the term of a patent is not based on a claim-by-claim approach (a questionable statement), and suggests "for a CIP application, Applicant should review whether any claim in the patent that will issue is supported in an earlier application. If not, Applicant should consider cancelling the reference to the earlier-filed application." 60 FR 20205. Some practitioners anticipate that CIP practice is going to largely disappear.
The new law provides for extending the term of patent, for up to five years, if the issuance of an original patent is delayed due to interference proceedings under 35 U.S.C. § 135(a) or because the application is placed under a secrecy order under 35 U.S.C. § 181. See 35 U.S.C. § 154(b)(1).
Additionally, under 35 U.S.C. § 154(b)(2), if the issuance of a patent is delayed due to appellate review by the Board of Patent Appeals and Interferences or by a Federal Court and the patent is issued pursuant to a decision in the review reversing an adverse determination of patentability, the term of the patent shall be extended for a period of time; again, in no case by more than five years.
Under 35 U.S.C. § 154(b)(3), the period of extension under 35 U.S.C. § 154(b)(2) shall be reduced by any time attributable to appellate review before the expiration of three years from the filing date of the application and for any period of time during which the Applicant did not act with due diligence, as determined by the Commissioner. These provisions appear to be a reasonable approach to restoring patent term that is lost for reasons beyond the control of the Applicant.
These provisions, however, are likely to have a very substantial impact on the course of prosecution of many applications, as they have the effect of encouraging appeal to the Board. Since the period of extension begins on the date on which an appeal is filed, or in which a District Court action is commenced under 35 U.S.C. § 145, and ends on the date of a final decision in favor of the Applicant, there is no patent term to be lost by pursuing an appeal (subject to the five-year limitation). Accordingly, an appeal to the Board or to the Federal Circuit will be important to preserve the patent term, when prosecution extends beyond three years in any application. After the expiration of three years, the time spent urging patentability on appeal will not be subtracted from the patent term, whereas the same period spent urging the same points before the Examiner will reduce the term. See K. Burchfiel, U.S. GATT Legislation Changes Patent Term, JPTOS, page 222, 227, March 1995.
The new patent term provisions, i.e., the 20-year term under amended 35 U.S.C. § 154(a)(2) takes effect on June 8, 1995, and will apply to all U.S. applications filed on or after that date, including continuations, divisionals and CIP's of applications currently pending. However, the new legislation extends the term of already-issued U.S. patents to the greater of 17 years from the date of grant, or 20 years from the date of filing the original application, whichever is longer, subject to any terminal disclaimers. 35 U.S.C. § 154(c)(1). The statute thus provides a windfall for cases in which pendency of the application was relatively short, and particularly for applications subject to first-action allowance. Patent owners should review their portfolios to determine whether patents issued on or after June 8 are subject to the extension provision.
This term extension is tampered by provisions for "intervening rights" for persons who had already commenced infringing acts or made substantial investments in relation thereto before the June 8 effective date. Thus, during the "bonus term," the remedies of § 283 (injunction), 284 (damages) and 285 (attorney fees) shall not apply. Instead, the amended statute provides that such acts may be continued upon the payment of an "equitable remuneration" to the patentee. The law does not explain what "equitable remuneration" is, leaving that for interpretation by the courts.
Applicants are naturally concerned about pending applications which were finally rejected prior to June 8. Conventionally, Applicants often file a "file wrapper continuation" to seek additional prosecution, further amend the claims, etc., after file rejection. This did not reduce the patent term (assuming success in obtaining a patent) since the term of the patent was issued from the date of grant. Under the new law, as noted above, the patent term clock keeps running from the filing date. In particular, applications which may have already been pending for several years and, indeed, which may refer to even earlier filed applications, for example, under § 120, would be subject to a severely curtailed term of an application while issued on a file wrapper continuation of such an application filed after June 8, but for the following transitional provision.
The transitional provision allow for limited reexamination in certain applications which were pending for two years or longer as of June 8, 1995, taking into account any reference to an earlier application under 35 U.S.C. § 120, 121 or 365(c). 37 C.F.R. § 1.129 provides that an Applicant in such a case (other than an application for a reissue or a design patent), is entitled to have a "first submission" entered and considered on the merits after final rejection. This "first submission" must be filed along with payment of the corresponding fee prior to the filing of an appeal brief and prior to abandonment of the application.
When the "first submission" is properly filed, the finality of the final rejection is automatically withdrawn. Importantly, a "submission" is defined in the rule as including, but not limited to, an information disclosure statement, an amendment to the written description, claims or drawings and a new substantive argument or new evidence in support of patentability. Rule 129 thus provides for what is essentially a file wrapper continuation practice without literally filing a new application. Thus, an Applicant can seek additional prosecution of a pending case without suffering the severe loss of patent term under the new law.
Rule 1.129(b)(1) is being added to provide for examination of more than one independent and distinct invention in applications pending for three years or longer as of June 8, 1995; again, taking into account any reference to any earlier application under 35 U.S.C. § 120, 121 or 365(c). Again, the new rules allow an applicant to avoid filing a continuation (or divisional) application after June 8 in appropriate cases. Each case must be considered relative to additional details of the transition provisions beyond the scope of this paper.
[1] Mr. Stolowitz, a patent attorney in private practice, is a shareholder of Marger, Johnson, McCollom & Stolowitz, P.C. in Portland, Oregon. He welcomes email addressed to micah@techlaw.com
[2] Unless otherwise specified, all statutory references are to Title 35, U.S. Code.
[3] "Use of information to the extent that any information in a NAFTA country or a WTO member country concerning knowledge, use, or other activity relevant to proving or disproving a date of invention has not been made available for use in a proceeding in the Patent and Trademark Office, a Court, or any other competent authority to the same extent as such information could be made available in the United States, the Commissioner, Court or such other authority shall draw appropriate inferences, or take other action permitted by statute, rule, or regulation, in favor of the party that requested the information in the proceeding." PL 103-465 §531(a).
[4] Section 119 is the Implementation of the Paris Convention in the U.S. patent law. In pertinent parts it provides, "an application for patent for an invention filed in this country by an person who has previously regularly filed an application for a patent for the same invention in a foreign country which affords similar privileges in the case of applications filed in the United States or to citizens of the United States, shall have the same effect as the same application would have if filed in this country on the date on which the application for patent for the same invention was first filed in such foreign country, if the application in this country is filed within twelve months from the earliest date on which such foreign application was filed." 35 U.S.C. §119.
[5] "In accordance with the conditions and requirements of §119 of this Title, a national application shall be entitled to the right of priority based on a prior filed international application which designated at least one country other than the United States." 35 U.S.C. §365(a).
[6] A regular application, i.e. one filed for examination under Section 111(a), is now called a "non provisional" application. 37 CFR §1.9(3).
[7] There is discussion in the U.S. of allowing patent applications to be filed by assignees. Present law, however, requires filing by the inventor or under her authorization.
[8] 35 U.S.C. §111(b)(4).
[9] Much of this discussion is inspired by "Effects of GATT and NAFTA on PTO Practice--PTO Day" 07 December 1994 by Charles E. VanHorn, former Administrator, Legislative and International Affairs, U.S. Patent and Trademark Office.
[10] The examination statute 35 U.S.C. §131 is made inapplicable to provisional applications by §111(b)(8).
[11] The term for a design patent is fourteen years. The design patent law was not affected by the GATT legislation.
[12] In fact, it is not unusual for an inventor and her patent attorney to draft claims designed to read squarely on a competitor's product, even though that product may not have existed when the application was first filed. There is nothing improper about this practice. See State Industries, Inc. v. A.O. Smith, [1985] USCAFED 1; 751 F2d. 1226 (Fed. Cir. 1985).
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