Effective Dates For Patent Reform

By Thad Cox and James McEwen

Ever since June 8, 2005, Representative Lamar Smith, then Chairman of the House Subcommittee on Courts, the Internet, and Intellectual Property, along with several co-sponsors, have attempted to change the U.S. patent system.  In 2005, this was through introduction of H.R. 2795.  Popularly known as the “Patent Reform Act of 2005 ,” the Patent Reform Act was an omnibus bill which overhauled multiple aspects of patent practice.  While this act aroused a significant amount of interest, it ultimately failed as lawmakers were unable to reconcile numerous competing interests.  Similar efforts failed in each successive legislative session.

However, with the Patent Reform Act of 2011, (H.R.1249) as introduced by Rep. Smith (R-TX) on March 30, 2011, the first significant change to the United States patent system has arrived.   Since renamed the Leahy-Smith America Invents Act was passed by the U.S. House of Representatives on June 23, 2011, and by the U.S. Senate on September 8, 2011, and is due to be signed by President Obama as soon as the end of this week.  As such, applicants and patent owners need to be aware of when the changes will become effective and when to expect the United States Patent and Trademark Office to begin changing the way it conducts business, including establishing new fee schedules.  What follows below is a summary of which portions of the Leahy-Smith America Invents Act are effective relative to the date of enactment.

I.   Effective the Day of the Enactment

 Fee Setting Authority, General Fees, and Small & Micro Entities

Sections 10 and 11 of the Patent Reform Act set forth a schedule of fees and give authority to the Director of the PTO to set and adjust fees.  This fee schedule, which amends 35 U.S.C. § 41, is substantially the same as the current fee schedule for the PTO (the only change is a minor alteration for extension fees, listed below in part I).

It is likely that the Director will soon exercise his new authority to adjust these fees so that PTO revenue matches spending.  Further, as an interim measure the Act imposes a 15% surcharge fee on most fees (as discussed below), which takes effect after 10 days and terminates once the Director exercises his fee-setting authority.  Surcharge fees of $100 or more are rounded to the nearest $10, while surcharge fees of less than $100 are rounded to an even number.  Finally, the Act provides that new “Micro Entities” shall have their fees reduced by 75%, as discussed in part N.

The following provisions take effect immediately upon enactment of the Act:

  1. The Director’s authority to set or adjust fees for recovering costs to the PTO for processing, activities, services, and materials relating to patents and trademarks.  However, this authority is subject to a sunset provision – it terminates 7 years from the enactment of the Act.
  2. Filing and basic national fees, set at the following amounts:
Fee Amount With 15% Surcharge 10 days After Enactment
Filing an application for an original patent, except for design or plant applications $330 $380
Filing an application for an original design patent $220 $254
Filing an application for an original plant patent $220 $254
Filing a provisional application for an original patent $220 $254
Filing an application for the reissue of a patent $330 $380
Basic national fee for an international application filed under the PCT entering the national stage $330 $380
For any application wherein the specification and drawings exceed 100 sheets of paper (or equivalent if filed electronically) $270 for each additional 50 sheets of paper (or equivalent if filed electronically) or fraction thereof $310 for each additional 50 sheets of paper (or equivalent if filed electronically) or fraction thereof
  1. Excess claims fees, set at the following amounts:
Fee Amount With 15% Surcharge
For each claim in independent form in excess of 3 $220 $254
For each claim (dependent or independent) in excess of 20 $52 $60
For an application containing a multiple dependent claim $390 $448
  1. Examination fees, set at the following amounts:
Fee Amount With 15% Surcharge
For examination of an application for an original patent, except for design, plant, provisional, or international applications $220 $254
For examination of an original design patent $140 $162
For examination of an original plant patent $170 $196
For examination of the national stage of an international application $220 $254
For examination of an application for the reissue of a patent $650 $748
  1. Issue fees, set at the following amounts:
Fee Amount With 15% Surcharge
For issuing an original or reissue patent, except design or plant patents $1,510 $1,740
For issuing an original design patent $860 $990
For issuing an original plant patent $1,190 $1,370
  1. A disclaimer fee, set at the following amount:
Fee Amount With 15% Surcharge
On filing each disclaimer $140 $162
  1. Appeal fees, set at the following amounts:
Fee Amount With 15% Surcharge
On filing an appeal from the examiner to the PTAB $540 $622
On filing a brief in support of the appeal $540 $622
On requesting an oral hearing in the appeal before the PTAB $1,080 $1,240
  1. Revival fees, set at the following amounts:
Fee Amount With 15% Surcharge
On filing a petition for revival of an unintentionally abandoned application, for an unintentionally delayed payment of the fee for issuing a patent, or for the unintentionally delayed response by the patent owner in a reexamination proceeding $1,620 $1,860
Unless the petition is filed under 35 U.S.C. §§ 133 or 151 $540 $622
  1. Extension fees for petitions for 1-month extensions of time to take required actions, set at the following amounts:
Former Fee Amount New Fee Amount With 15% Surcharge
Extension for response within first month: $130 First petition: $130 $150
Extension for response within second month: $490 Second petition: $360 $414
Extension for response within third month: $1,110 Third or subsequent petition: $620 $714
Extension for response within fourth month: $1,730 n/a n/a
Extension for response within fifth month: $2,350 n/a n/a
  1. Maintenance fees, except design/plant patents, set at the following amounts:
Fee Amount With 15% Surcharge
3 years and 6 months after grant $980 $1,130
7 years and 6 months after grant $2,480 $2,850
11 years and 6 months after grant $4,110 $4,730
  1. Patent search fees (except for provisional applications), set at the following amounts:
Fee Amount With 15% Surcharge
For each application for an original patent, except for design, plant, provisional, or international applications $540 $622
For each application for an original design patent $100 $116
For each application for an original plant patent $330 $380
For the national stage of each international application $540 $622
For each application for the reissue of a patent $540 $622
  1. The 15% surcharge does not apply to these fees:
Fee Amount
For recording a document affecting title $40 per property
For each photocopy $0.25 per page
For each black and white copy of a patent $3
The yearly fee for providing a specified with uncertified printed copies of the specifications and drawings for all patents $50
  1. The above fees shall be reduced by 50% for any applicant who qualifies as a “Small Entity” – any small business concern as defined under section 3 of the Small Business Act, and any independent inventor or nonprofit organization as defined in regulations issued by the Director.  The fee for filing an application for an original patent, except for design, plant, or provisional applications, shall be reduced by 75% for small entities if the application is filed electronically.
  2. Once the Director exercises his fee-setting authority, such fees as he may set shall be reduced by 50% for any applicant who qualifies as a small entity and by 75% for any applicant who qualifies as a “Micro Entity.”  A micro entity is any small entity that: (1) has not been named as an inventor on more than 4 previously filed patent application; (2) did not have a gross income for the previous year exceeding 3 times the median household income; and (3) has not assigned, granted, or conveyed (and is not under an obligation by contract or law to assign, grant, or convey) any ownership interest in the application to an entity that had a gross income for the previous year exceeding 3 times the median household income.

Defenses to Infringement Based on Prior Commercial Use

Section 5 of the Patent Reform Act modifies the ability to use certain defenses based on an earlier commercial use in an infringement action.  This provision takes effect immediately upon enactment of the Act.  It applies to any patent issued on or after the date of enactment.

Change of Default Venue

Section 9 of the Patent Reform Act shifts the default venue for actions brought under 35 U.S.C. §§ 32, 145, 146, 154(b)(4)(A), and 293, as well as under 15 U.S.C. § 1071(b)(4), from the U.S. District Court for the District of Columbia to the U.S. District Court for the Eastern District of Virginia.

This provision takes effect immediately upon enactment of the Act and applies to any civil action commenced on or after that date.

Best Mode Requirement no Longer a Basis to Cancel an Issued Patent

Section 15 of the Patent Reform Act maintains the previous requirement for the inventor to disclose the best mode for accomplishing the invention, and failure to do so remains a basis upon which an examiner may reject an application under 35 U.S.C. § 112.  However, failure to disclose the best mode will no longer be a basis upon which an issued patent claim may be canceled or held invalid or otherwise unenforceable under 35 U.S.C. § 282.

This provision takes effect on the date of enactment of the Act.  It applies to all proceedings that commence on or after this effective date.

Virtual Markings and Limited Ability to Bring False Marking Actions

Section 16 of the Patent Reform Act amends 35 U.S.C. § 287(a) by allowing for virtual markings, which are markings that direct the public to a free internet address that associates the patented article with the number of the patent.

Section 16 also amends 35 U.S.C. § 292 to significantly limit the ability to bring qui tam lawsuits for false marking.  Only individuals who have suffered a competitive injury as a result of the false marking may bring such action.  Further, those individuals may recover damages adequate to compensate such injury, but only the U.S. government may collect the statutory penalty for false marking.  Previously, the plaintiff collected one-half of the penalty, with the other half going to the government.

These provisions take effect on the date of enactment of the Act.  They apply to all cases, without exception, that are pending on, or are commenced on or after, this effective date.

Jurisdiction and Procedure

Section 19 of the Patent Reform Act amends several Federal rules and procedures.  28 U.S.C. § 1338(a) is amended to deny jurisdiction by state courts over actions arising under Acts of Congress relating to patents, plant variety protection, and copyrights.  28 U.S.C. § 1295(a)(1) is amended to grant exclusive jurisdiction of appeals in all cases relating to patents or plant variety protection.

Section 1454 is added to Chapter 89 of title 28 of the U.S.C., allowing for the removal to U.S. district court of any civil action relating to patents, plant variety protection, or copyright, and the remand of unrelated matters.  Finally, § 299 is added to Chapter 29 of title 35 of the U.S.C., allowing for accused infringers to be joined as defendants in a single action if the right to relief arises out of the same transaction or occurrence.

These provisions apply to any civil action commenced on or after the date of enactment of the Act.

II,  Takes Effect After 10 Days (and Terminates When the Director Exercises his Fee-Setting Authority)

$4,800 Prioritized Examination Fee and 15% Transition Surcharge Fees

Section 11 of the Patent Reform Act establishes a fee of $4,800 for filing a request for prioritized examination of a nonprovisional application for an original utility or plant patent.  This provision takes effect 10 days from the date of enactment of the Act, but terminates when the Director exercises his fee-setting authority with respect to this fee.

Section 11 also imposes a 15% surcharge fee on all fees charged discussed above in Section I.  This provision also takes effect 10 days from the date of enactment of the Act and terminates when the Director exercises his fee-setting authority with respect to this fee.

III.  Takes Effect After 60 Days

$400 Electronic Filing Incentive

Section 10 of the Patent Reform Act establishes a new electronic filing incentive provision, which imposes an additional $400 fee on new applications that are not filed electronically.  This provision takes effect 60 days from the date of enactment of the Act.

Takes Effect After 1 Year

Substitute Declarations or Oaths Requirement Relaxed

Section 4 of the Patent Reform Act relaxes the requirements for substitute declarations or oaths by assignees under 35 U.S.C. § 115.  This provision takes effect 1 year from the date of enactment and applies to any patent application filed on or after this effective date.

Third Party Challenges: Post-Grant Review, Inter Partes Review, and Preissuance Submissions

Post-Grant Review

Section 6 of the Patent Reform Act adds Chapter 32 to title 35 of the U.S.C.  This new chapter allows any third party to request the cancellation of one or more claims of a patent, on any ground that could be raised under defenses (2) or (3) of 35 U.S.C. § 282, by petitioning for post-grant review of the patent.  This petition must be filed within 9 months of the date the patent is granted (or the date the reissue patent is issued).

This provision takes effect 1 year from the date of enactment of the Act.  Except as provided in Sections 6(f)(3) and 18, it applies only to patents that contain or contained at any time: (1) a claim with an effective filing date [as defined in 35 U.S.C. § 100(i)] that is on or after the effective date of this provision, or (2) a specific reference under 35 U.S.C. §§ 120, 121, or 365(c) to any patent or application having such a claim.

Inter Partes Review

Section 6 of the Patent Reform Act also amends Chapter 31 of 35 U.S.C. to allow third parties to petition for inter partes review of a patent.  A petitioner in an inter partes review may request the cancellation of one or more claims of a patent, but only on novelty or obviousness grounds, and only on the basis of prior art consisting of patents or printed publications.  The petition can only be filed after the later of: (1) 9 months after the grant of the patent (or issuance of a reissue of the patent), or (2) if a post-grant review is instituted under Chapter 32, the date of termination of such post-grant review.

This provision takes effect 1 year from the date of enactment of the Act.  It applies to any patent application filed before, on, or after this effective date.  Additionally, for requests for inter partes reexamination filed on or after the date of enactment but before the effective date of this provision, there is a transition period, wherein:

  1. 35 U.S.C. § 312(a) is amended as follows:
  2. In the first sentence, by striking “a substantial new question of patentability affecting any claim of the patent concerned is raised by the request,” and inserting “the information presented in the request shows that there is a reasonable likelihood that the requester would prevail with respect to at least 1 of the claims challenged in the request,”; and
  3. In the second sentence, by striking “The existence of a substantial new question of patentability” and inserting “A showing that there is a reasonable likelihood that the requester would prevail with respect to at least 1 of the claims challenged in the request.”
    1. 35 U.S.C. § 312 (c) is amended as follows:
    2. In the second sentence, by striking “no substantial new question of patentability has been raised,” and inserting “the showing required by subsection (a) has not been made.”
      1. 35 U.S.C. § 313 is amended as follows:
      2. By striking “a substantial new question of patentability affecting a claim of the patent is raised” and inserting “it has been shown that there is a reasonable likelihood that the requester would prevail with respect to at least 1 of the claims challenged in the request.”

Preissuance Submissions

Section 8 of the Patent Reform Act amends 35 U.S.C. § 122 by adding subsection (e).  This subsection allows any third party to submit any patent or printed publication, along with a statement of relevance, for consideration by the examiner of any pending patent application.

This provision takes effect 1 year from the date of enactment of the Act.  It applies to any patent application filed before, on, or after this effective date.

Patent Trial and Appeal Board (PTAB) and Appeals to the Federal Circuit

Section 7 of the Patent Reform Act replaces the Board of Patent Appeals and Interferences (BPAI) with the Patent Trial and Appeal Board (PTAB).  The PTAB is comprised of the same members and performs substantially the same duties as the BPAI; however, the PTAB accommodates the new procedures provided by the Act.  These new procedures include conducting derivation proceedings (which essentially take the place of interference proceedings), as well as inter partes and post-grant reviews, as described in Section 6 of the Act.  Section 7 also provides for appeals directly from the PTAB to the U.S. Court of Appeals for the Federal Circuit of PTAB decisions regarding examinations, reexaminations, post-grant and inter partes reviews, and derivation proceedings.

This provision takes effect 1 year from the date of enactment of the Act.  It applies to proceedings commenced on or before this effective date, except that:

  1. The extension of jurisdiction to the U.S. Court of Appeals for the Federal Circuit to entertain appeals of decisions of the PTAB in reexaminations under the amendment made by subsection (c)(2) takes effect on the date of the enactment of this Act and extends to any decision of the BPAI with respect to a reexamination that is entered before, on, or after the date of the enactment of this Act;
  2. The provisions of 35 U.S.C. §§ 6, 134, and 141, as in effect on the day before the effective date of this provision shall continue to apply to inter partes reexaminations that are requested under § 311 of such title before such effective date;
  3. The PTAB may be deemed to be the BPAI for purposes of appeals of inter partes reexaminations that are requested under 35 U.S.C. § 311 before the effective date of this provision; and

The Director’s right under the fourth sentence of 35 U.S.C. § 143, as amended by subsection (c)(3) of this provision, to intervene in an appeal from a decision entered by the PTAB shall be deemed to extend to inter partes reexaminations that are requested under 35 U.S.C. § 311 of such title before the effective date of this provision.

Supplemental Examination

Section 12 of the Patent Reform Act creates the ability for a patent owner to request supplemental examination of a patent to consider, reconsider, or correct information relevant to the patent.  The Director shall, by regulation, establish fees for the submission of a request for supplemental examination.

If the information presented in the request raises a substantial new question of patentability, the Director shall order reexamination of the patent and the patent owner must pay also fees established and applicable to ex parte reexamination proceedings

This provision takes effect 1 year from the date of enactment of the Act.  It applies to any patent issued before, on, or after this effective date.

Advice of Counsel re: Infringement

Section 17 of the Patent Reform Act adds § 298 to Chapter 29 of title 35 of the U.S.C.  This new section provides that neither the failure of an accused infringer to obtain the advice of counsel with respect to an allegedly infringed patent, nor the failure to present such advice to the court or jury, may be used to prove that infringement was willful or induced.

This provision is not specifically provided with an effective date in Section 17, and therefore it takes effect 1 year from the date of enactment of the Act, according to the catch-all effective date provision of Section 35 of the Act.  It applies to any patent issued on or after this effective date.

IV.  Takes Effect After 18 Months

First-to-File System

Section 3 of the Patent Reform Act shifts the U.S. patent system from a first-to-invent system to a first-to-file system, thereby promoting harmonization with the patent systems used by nearly all other countries throughout the world with whom the United States conducts trade.

Generally, this provision takes effect 18 months from the date of enactment.  This provision applies to any patent application or patent that contains or contained at any time: (1) a claim with an effective filing date [as defined in 35 U.S.C. § 100(i)] that is on or after the effective date of this provision, or (2) a specific reference under 35 U.S.C. §§ 120, 121, or 365(c) to any patent or application having such a claim.

However, with regard to interfering patents, the provisions of 35 U.S.C. §§ 102(g), 135, and 291, as in effect on the day before the effective date of this provision given above, continue to apply to each claim of a patent application or patent that contains or contained at any time: (1) a claim with an effective filing date that is before the effective date of this provision, or (2) a specific reference under 35 U.S.C. §§ 120, 121, or 365(c) to any patent or application having such a claim.

V.    Conclusion

While there are a number of changes created by the Leahy-Smith America Invents Act, most of the more dramatic effects will not be felt for months to come.   However, applicants need to be aware of some of the immediate effects, and especially those related to increased fees and should act accordingly to help reduce costs.

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One thought on “Effective Dates For Patent Reform

  1. Pingback: America Invents Act Signed Into Law | Stein McEwen Blawg

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