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January 2012 CBA REPORT
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cover article
and authorizing protective orders for
exchanging and submitting confidential
information. Thus, PGR has features lik-
ened to the discovery process one may be
subjected to in federal district court. Two
of the most obvious potential impacts
from this discovery process are its cost
and the drain on employee resources.
There are limits to PGR. PGR is only
available during the nine months follow-
ing issuance of a patent or reissue patent.
Further, PGR does not apply to certain
business method patents (which are sub-
ject to a transitional program that will go
into effect sooner) or patents involved in
pending interferences.
Best Mode
Under U.S. patent law, an inventor
must disclose in the specification what
was contemplated as the best mode for
practicing the claimed inventions. That
disclosure must be adequate so those
having ordinary skill in the art can
practice the claimed invention. Prior
to the America Invents Act, failure to
describe the best mode was a defense
that could render the patent invalid.
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If
non-disclosure was demonstrated to be
intentional, and with an intent to deceive
the PTO, it could even render the patent
unenforceable.
The America Invents Act maintains
the requirement for an inventor to
disclose best mode.
8
However, under the
new statutory system, failure to disclose
best mode is no longer grounds for
invalidating the patent or rendering it
unenforceable. This change became effec-
tive upon enactment of the Act.
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Supplemental Examination
Available
The defense of inequitable conduct
has been described by the Federal Circuit
as a scourge on U.S. patent litigation. A
provision of the America Invents Act
attempts to ameliorate, and potentially
eliminate, inequitable conduct defenses
in particular instances. The Act’s
“supplemental examination procedure”
allows a patent owner to present infor-
mation to the PTO, and a patent can
no longer be found to be unenforceable
based on such information “considered,
reconsidered, or corrected during a
supplemental examination of the pat-
ent.” The PTO will, however, determine
whether the submitted information
raises a substantial new question of
patentability. If the answer is affirmative,
the PTO is required to order reexamina-
tion.
10
While the Act’s supplemental
examination procedure may eliminate
from future litigation certain inequitable
conduct defenses, that same procedure
may result in re-examination of the
patent. Another significant risk for the
patent owner in filing for supplemental
examination is that it does not preclude
the imposition of sanctions based upon
violations of criminal or antitrust laws.
It also does not limit the authority of the
director to investigate issues of possible
misconduct and impose sanctions for
misconduct in connection with matters
or proceedings before the PTO. Also, the
Act does not insulate patent owners if
the director becomes aware, during the
course of a supplemental examination
or re-examination proceeding ordered
under this section, that a material fraud
on the PTO was committed. If so, the
PTO is required to notify the Attorney
General for possible criminal action.
Against this backdrop, it should be
noted that recent case law places upon an
accused infringer a significantly higher
burden of proof regarding an unenforce-
ability defense. In general, an accused
infringer must show “but for” the omit-
ted information, a claim of the patent
would not have been issued.
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Many
practitioners suggest such a high hurdle
means patent owners are better off facing
the issue in court, rather than putting
their patent through the supplemental
examination procedure.
Effective Sept. 16, 2012, any third
party can submit patents, published ap-
plications, and printed publications in
connection with pending patent applica-
tions. While there are limitations relating
to the time period during pendency of
a patent application that this prior art
can be submitted, this is a significant
departure from the former patent law.
Specifically, the prior art must be sub-
mitted before the earlier of a Notice of
Allowance or the later of (a) six months
after publication of the application or
(b) the first rejection by the examiner. A
concise description of relevance for each
document submitted must accompany
the submission.
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False Marking
In response to the recent dramatic
increase in lawsuits filed for alleged false
marking pursuant to 35 U.S.C. § 292(a),
the America Invents Act also incorpo-
rates several provisions that significantly
curtail such claims. The false marking
statute provides for a civil fine for false
marking, i.e., marking on or in connec-
tion with an article the word “patent”
or other similar connotation, when the
article is not covered by at least one claim
of that patent. Under the prior law, any
person could institute a lawsuit for false
marking and, if successful, recover half
of the civil fine. The other half of the civil
fine would inure to the United States.
Given that the fine for false marking is
authorized up to $500 for every offense,
and that every article sold constitutes an
offense, false marking lawsuits have been
numerous.
Under the America Invents Act,
however, only the United States may sue
for the civil fine authorized by the false
marking statute. In addition, damages
sought in false marking suits brought by
plaintiffs other than the United States are
now limited to demonstrated competi-
tive injury resulting from the alleged
false marking. Only damages adequate to
compensate for that competitive injury
may be recovered.
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Schatz is a partner with Wood Herron & Evans
where he focuses his practice in the area of intellectual
property litigation. He has litigated to conclusion
complex lawsuits in all areas of intellectual property,
including patents, trade secrets, copyrights, and
trademarks. In his litigation practice, Schatz has
handled cases in federal courts across the country, as
well as in various state courts in Ohio.
1 H.R. 1249 Section 3.
2 H.R. 1249 Section 3.
3 H.R. 1249 Section 3(i); 35 U.S.C. § 135.
4 H.R. 1249 Section 6.
5 H.R. 1249 Section 6; 35 U.S.C. § 314.
6 H.R. 1249 Section 3; 35 U.S.C. § 102.
7
U.S. Gypsum Co. v. National Gypsum Co.
, 74 F.3d 1209,
1212 (Fed. Cir. 1996).
8 35 U.S.C. § 112, ¶ 1.
9 H.R. 1249 Section 15; 35 U.S.C. § 282.
10 H.R. 1249 Section 12.
11
Therasense, Inc. v. Becton, Dickinson & Co.
, 649 F.3d 1276,
1296 (Fed. Cir. 2011).
12 H.R. 1249 Section 8.
13 H.R. 1249 Section 14.
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