IP Briefs: Demystifying the Patent Reform Act and its Impact on Company IP Strategy - IP stakeholders should focus on both patent procurement and enforcement strategies to maintain harmony between IP


IP Briefs: Demystifying the Patent Reform Act and its Impact on Company IP Strategy
IP stakeholders should focus on both patent procurement and enforcement strategies to maintain harmony between IP assets and company business strategy

BioPharm International
Volume 20, Issue 1

Inter Partes Reexamination

H.R.2795 proposes conforming the current reexamination estoppel provisions to those proposed for opposition proceedings, eliminating the provision to "could have raised."18 Any reexamination request made during the nine-month opposition period will be treated as an opposition and requests made during pending opposition proceedings will be stayed. Effectively, these revisions will make the opposition the primary avenue for postgrant challenges and remove reexamination as a timely mechanism for narrowing or canceling a competitor's patent claims.


First Inventor-to-File and Assignee Filing Systems

The Act will change the patent system from a first-to-invent to a first-inventor-to-file system, limiting interference proceedings to inventorship disputes.19 Although the bill makes clear that a valid patent can only be obtained through an inventor, application filing would be permitted by the assignee.20

The provisions will simplify filing procedures and provide certainty to priority disputes. These will also increase the urgency to secure an early filing date and further raise the existing tension between balancing filing strategy with actual reduction to practice and with providing an enabling disclosure.

Redefinition of Prior Art

The Act will substantially limit the scope of prior art to patents, publications or other information that is publicly known, but would maintain a one year grace period for the inventor's own work.21 Offers for sale or secret use by another would not invalidate a patent. Information would be deemed publicly known if it (1) was reasonably and effectively accessible through its use, sale or other disclosure or (2) is embodied in or inherent in reasonably and effectively accessible subject matter.

The proposed narrowing of applicable prior art by eliminating invalidating secret offers for sale and prior, secret development by another will preclude the defense of prior invention by another, including those inventions maintained as a trade secret. The emphasis on accessibility may become problematic in fields such as software where a large body of prior art is not in patents or printed publications. In formulating IP strategy, a company will need to anticipate litigation surrounding this issue and also what constitutes information embodied in accessible subject matter.


IP stakeholders continue to maintain a "wait and see" posture. However, it remains to be seen whether controversial issues such as the apportionment of damages will delay enactment of other provisions in the bill.22 If the reforms are enacted, all stakeholders should be diligent in prioritizing and implementing modifications to portfolio management and strategy that synchronize the scope and protection of IP assets to company business goals.

David A. Gay, PhD, is counsel in the law firm of McDermott Will & Emery LLP, San Diego, CA, 858.643.1411,
William Gaede is a partner in in the firm's Palo Alto office,


1. H.R.2795. 109th Cong. 2005.

2. 5 Stat. 117.

3. Merrill S, Levin R, Myers M, eds. Federal Trade Commission, To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy (Oct 2003); Committee on Intellectual Property Rights in the Knowledge-Based Economy, National Research Council, A Patent System for the 21st Century. The National Academies Press. Apr 2004.

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