Things to Know About the Latest Final Interim Rules to Patent Term Adjustment

by Sheppard Mullin Richter & Hampton LLP
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On April 1, 2013, the U.S. Patent and Trademark Office (USPTO) published interim final rules revising several patent term adjustment (PTA) provisions in view of the AIA Technical Corrections Act of January 14, 2013. 78 Fed. Reg. 19416. The USPTO’s interim final rules became effective on April 1, 2013, and apply to any patent granted on or after January 14, 2013. Applications pending as of January 14, 2013 are therefore subject to the new rules.

The interim final rules aim to eliminate administrative inefficiencies that existed under the old system and streamline the legal procedures for challenging PTA within and outside the USPTO. The interim final rules cover six different areas, each of which is discussed in detail below.

Initial PTA Determination is Eliminated

Under the revised rules, the USPTO will no longer provide its initial PTA determination in the Notice of Allowance. Applicants will now be notified of the actual PTA at the time of patent grant.

Under the previous rules, the USPTO determined the PTA in two separate instances—one at the time of Notice of Allowance (initial determination), and another at the time of Issue Notification (actual determination taking into consideration any delay incurred between the Notice of Allowance and Issue Notification). The old system was flawed because the amount of PTA could not be finally calculated until the patent issued, despite the previous rules that the Office make a determination at the time of the Notice of Allowance.

Deadline for Requesting Reconsideration of PTA is Extended

Under the old rules, a patentee dissatisfied with the Office’s PTA calculation must challenge it within two months after patent grant.

Under the new rules, these two months can be extended for an additional total of five months upon payment of fees. The new rules effectively give patentees more time to review PTA and challenge its calculation.

To challenge the Office’s PTA calculation, a patentee may file a Request for Reconsideration of PTA to request correction of any PTA errors that occurred during prosecution. The new rules also allow patentees for patents granted during the transition period to file or re-file the Request for Reconsideration that is otherwise unavailable under the old rules.

Deadline for Civil Action is Now Set at 180 Days from USPTO Decision on Request for Reconsideration

The interim final rules also implement significant changes related to the conditions and circumstances under which a patentee can bring a district court civil action to challenge a PTA determination.

Under the prior rules, a civil action must be filed “within 180 days after the grant of the patent,” which forced patentees to file suits without having received a decision on a Request for Reconsideration by the USPTO, only to have the actions dismissed if the USPTO’s reconsideration decision was ultimately satisfactory.

The interim final rules now provide the patentees with an additional month to file suits (180 days v. 7 months). Additionally, under the new rules, patentees seeking judicial review of the USPTO’s PTA calculation must first: (1) seek to file a Request with the USPTO Director within seven months of the patent’s grant date; and (2) obtain the USPTO’s decision on the Request. Patentees may seek judicial resolutions only after an unsuccessful administrative challenge within the USPTO, but such legal remedies must be sought with the District Court for the Eastern District of Virginia within 180 days of the USPTO’s decision.

The new rules also make clear that judicial remedies are not alternatives to requesting reconsideration of the PTA, meaning that the Request for Reconsideration is now a pre-requisite to bringing district court civil actions. Patentees wishing to seek judicial review may no longer bypass administrative resolutions, as the USPTO decision date is required to set the 180-day period for filing a civil action.

Interim Final Rules Use the National Stage Commencement Date As the “Application Filing Date” for National Stage Applications

The interim final rules also level the playing field for national stage applications filed under 35 U.S.C. § 371. As background, the current PTA statute (35 U.S.C. § 154) compensates patentees with additional PTA for internal delays caused by the USPTO, including when the first action on the merits is issued more than 14 months after the application filing date (commonly known as the “A” delay).

The old rules prejudiced national stage applicants with respect to the start time for this “A” delay, where the 14-month clock started upon the fulfillment of all formal requirements of 35 U.S.C. § 371 for national stage applications, whereas the clock started on the actual filing date for utility applications filed under 35 U.S.C. 111(a). This meant that national stage applications that were delayed as a result of missing formal documents had a significant disadvantage because of the delayed start of the “A” delay clock.

The new rules seek to remedy this uneven playing field by employing the date of national phase commencement of the national stage applications as the “application filing date,” and not the date on which all requirements of 35 U.S.C. § 371 are satisfied. The new rules permit national stage applicants to take advantage of the new ability to delay submission of formal documents without risking a loss of PTA that would otherwise be granted for domestic utility applications filed under 35 U.S.C. 111(a).

Reinstatement of PTA Is Permitted Under the New Rules Upon Showing of Good Cause

The current PTA statute mandates a reduction in PTA when “the applicant failed to engage in reasonable efforts to conclude prosecution,” which includes taking more than three months to reply to a notice or action by the USPTO. See 37 C.F.R. 1.704.

The new rules now permit an applicant to request reinstatement of all or part of the reduced period of adjustment upon showing that, in spite of all due care, the applicant was unable to respond within three months. Like the old rules, the new rules require such a request to be filed prior to issuance.

Public Comments

The Interim Final Rules have an immediate effective date of April 1, 2013. However, the USPTO will accept public comments within 60 days up to May 31, 2013, after which the final rules are expected to be published.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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