Patent Office Issues New Internal Guidance on Subject Matter Eligibility

On March 4, 2014, the Patent Office published a guidance memorandum titled Guidance For Determining Subject Matter Eligibility Of Claims Reciting Or Involving Laws of Nature, Natural Phenomena, & Natural Products (Guidance). The Guidance implements a new procedure to address changes in the law relating to subject matter eligibility under 35 U.S.C. § 101 in view of recent court decisions including Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. __, 133 S. Ct. 2107, 2116, 106 USPQ2d 1972 (2013), and Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U.S. __, 132 S. Ct. 1289, 101 USPQ2d 1961 (2012).

Examiners are being trained – and indeed some have completed training – with regard to these new guiding rules. You can expect some bumps and disagreements as practitioners and examiners debate the role of the Guidance and how it shapes examination of particular claims, but continued efforts towards clarity in patent examination are always appreciated.

You can view the new Guidance document here.

You can view a Quick Reference Sheet here.

You can view Training Slides used to train the patent examiners here.


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Marty Stoneman Passes Away

Phoenix patent attorney Martin Stoneman passed away on February 5, 2014. Marty had a large presence in the Phoenix patent market; he worked on over 250 issued patents and many more patent applications. Cases continue to issue posthumously and likely will for some time. I knew him only a little, but had colleagues who had worked with him at length. I’d taken over several cases from Marty as well, and clients spoke fondly of him. His death will be felt in the Phoenix community for quite a long time.

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Is a Comprehensive Clearance Search for Your Trademark Worth the Money?

This post written by guest author, attorney Gianni Pattas.

Everything is perfect. You paid a graphic designer to design your brand new logo for your business. You paid the radio to run ads advertising the grand opening of your business. You paid a small fortune to have that brand new sign outside your business that makes you stand out from your competitors. There’s no turning back now, and why would you? You have spent thousands and thousands of dollars and are now ready to start your brand new business. Everything is perfect.

Suddenly, things do not seem so perfect. You get a letter after your first day of opening from an attorney telling you to cease and desist the use of your new businesses name because you are infringing the trademark rights of their client.

This is a harsh reality that many small business owners have faced. In order to save money in the short term, they did not adequately plan ahead for the long term.

Many times trademark applicants will be presented with the option of a comprehensive trademark clearance search to make sure their proposed mark is clear for use. And often, in order to save money, people will forego this option and proceed with filing of their trademark application, “blind” to what else is out there. They believe that they can scour the Internet and the federal trademark database for potential problems that they might face when using their own mark. Many businesses believe it is an important step to take. But it may not be sufficient, and in some cases, a self-guided search can even be dangerous.

A trademark attorney who deals with this subject matter on a daily basis has the resources and knowledge to do a thorough search and ensure that future problems do not arise with the use of your proposed trademark. A trademark attorney can advise you whether there are identical or similar marks already registered that may present problems downstream in the trademark application process, or whether there is use in particular geographic locations that may be specially problematic for your business, or whether there are filing strategies you can adopt when writing a trademark application based on the presence – or lack of presence – of other marks on the federal trademark registry.

So is a comprehensive clearance search for your trademark worth the money? As the common saying goes, “An ounce of prevention is worth a pound of cure.”

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Secret Prior Use after the AIA Patent Reform

We’re closing in on the one-year anniversary of the AIA’s full implementation on March 16, 2013. Though some portions of the law have been in place for more than a year, there is still a great deal of debate about how the new law will be interpreted. A few months ago, I wrote about the disagreement about how a secret offer for sale should be treated under the new rules. Now, I’ll discuss the disagreement in how a secret use of a process is treated for prior art purposes.

As a review picking up from the last discussion, the AIA changed the way prior art and potentially patent-barring disclosures are defined. One provision states that, with exceptions, the invention is not patentable if it “was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.” The “otherwise available to the public” phrase seems to indicate Congressional intent that the disclosure must be a public one, and thus secret uses behind company walls would not jeopardize the novelty of the invention.

The Patent Office has adopted this position, noting that “The legislative history of the [law] indicates that [the prior art provision] does not cover non-public uses or nonpublic offers for sale.” Many practitioners and professional associations agree, including the American Intellectual Property Law Association and the Intellectual Property Law Section of the ABA.

Others disagree, however, because there is a long line of case law that lays out the tremendous public policy reason for recognizing secret uses as prior art. Specifically, a patent applicant should be prevented from commercializing a product under a patent for 20 years and then, patenting the process for making that process as well, effectively extending the patent protection beyond the statutory period and denying the public from using and building from the invention.

Unfortunately, it will be many years until this ambiguity is resolved, because it will likely require a court – an appeals court – to decide the issue. That requires that a case be tried in a district court, which requires there to be an infringement claim based on a patent, which requires a patent application to have been filed after March 16, 2013. With the delays at the Patent Office in issuing patents, and the delays through court, it could be some time before we know how secret prior uses will be handled.

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Prosecution History Estoppel in Design Patents

Recently decided Pacfic Coast Marine Windshields, Ltd. v. Malibu Boats, LLC established, perhaps predictably, that prosecution history estoppel is a doctrine that can be enforced in design patent litigation.

Prosecution history estoppel is the practice of defending a patent litigation suit by arguing that the patent owner surrendered some scope of protection during the examination and processing of the application that became a patent, and that that scope would have covered your product. In other words, the defense asserts that the very product that it makes was one which the patentee attempted to patent, but couldn’t because it wasn’t patentable, and so carved out of its application in order to get the patent to grant. By carving it out, the patentee surrendered that subject matter to the public for anyone to make and use.

Previously, this doctrine was only used in utility patent cases. However, the Pacific Coast case made clear that it also holds true in design cases. Design patent applications are often filed with multiple embodiments, and the Patent Office frequently issues a restriction requirement stating that the different embodiments are too different to be included under one application and thus must be divided out. If the applicant removes the extra embodiments from the application and doesn’t later file divisional applications to those embodiments, prosecution history estoppel may establish that the extra embodiments were surrendered.

Indeed, this is just what happened in Pacific Coast. There, the Pacific Coast boat windshield company filed a design application for a number of windshield designs including some with round holes in the frame, some with square holes, some with oblong holes, as seen below. The Patent Office issued a restriction requirement, and Pacific Coast elected just one design, which had four round holes. Pacific Coast later filed one divisional application to another design, but not divisionals on all the designs.

design patent

Malibu Boats later began manufacturing a windshield with three oblong holes in the frame, similar to one of the designs on which Pacific Coast had originally filed but did not follow up with a divisional. The trial court held that Pacific Coast did commit prosecution history estoppel and that the Malibu Boats’ design was within the scope of the surrendered subject matter. On appeal, the Federal Circuit agreed on the prosecution history estoppel, but said that the subject matter was not the same.

In light of this case, clients may sometimes find that it is better to file multiple embodiments of designs in separate, individual design applications, rather than combining them into one. Doing so can reduce the risk of prosecution history estoppel, which would otherwise force an applicant to restrict out different embodiments from a single application and then chase each one with a divisional lest it risk surrendering that embodiment to the public. However, this can be a costlier approach up front. Careful thought and consideration should be undertaken when deciding how to file multiple embodiments.

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What Can and Cannot be Patented?

Patents can protect inventions, ornamental designs on articles of manufacture, and asexually reproduced plants.  A utility patent is available for a new, nonobvious, and useful invention that falls into one of the following categories:

  • Process
  • Machine
  • Article of manufacture
  • Composition of matter
  • Improvement of any of the above

Congress has decided that some things cannot ever be patented, however, and has written into the laws that the following categories are unavailable for protection:

  • Laws of nature
  • Physical phenomena
  • Abstract ideas
  • Literary, dramatic, musical, and artistic works (these can be protected with copyright, however)
  • Inventions which are either not useful / impossible (such as perpetual motion machines) or inventions which are offensive to public morality

There are a number of requirements for patentability.  An invention must fall into one of the above categories, but must also be:

  • Novel
  • Nonobvious
  • Adequately described or enabled (for one of ordinary skill in the art to make and use the invention)
  • Claimed by the inventor in clear and definite terms

These four requirements above are often the most difficult hurdles for most applicants and inventors to overcome, especially if the applicant attempts to draft a patent application on its own.  The application submitted to the Patent Office must be written so that the invention is presented as a novel and nonobvious one, or it must be proven in argument later on.  Additionally, the application must describe and claim the invention fully and clearly, which, in some ways, means that the application should adhere to terminology generally used in patents and must always adhere to the many, many rules regarding formatting and diction.

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Do I Need to Build my Invention to File a Patent Application?

I’m asked this question exceptionally patent officefrequently. In fact, almost every client who hasn’t yet built their idea out into at least a first prototype wants to know if they need to take this step. The answer is no, usually.

There is certainly no specific law that says anything like “you must create a prototype prior to filing a patent application,” or any black-and-white rule that requires something be built before hand. Like all things with law, the requirement is much more in the gray.

Before a patent application can be filed, the invention must have actually been “invented” in a legal sense. Patent law defines the act of inventing as the conception of an idea followed by the reduction to practice of that idea. “Reduction to practice” can be achieved by actually building your idea out, or by being able to describe it with sufficient detail such that you can show you were in possession of the idea, and so that someone with ordinary skill in the field of invention would know how to make your idea and how to use your idea. This test has no clear boundaries; the need to build a prototype is going to depend on the level of complexity of the invention.

For example, if you’ve come up with a new kind of shoelace, there probably isn’t a great of complexity in the design. It likely isn’t going to require a ton of time to describe what the structure and materials of the shoelace are. The amount of time needed to describe an invention is generally a proxy for its level of complexity. With a shoelace, if you can describe it to your patent attorney within a few hours, it probably doesn’t need to be built out.

If, on the other hand, you’ve invented a new kind of heart medicine, then a build is almost certainly required. Medication can take a huge amount of research, experimentation, trial-and-error, and money to perfect. In order to be able to describe the chemical formula of the medication, you will have to figure out what that chemical formula is, by first developing the drug.

So, the need to build a prototype depends to a large extent on the complexity of the invention. However, it is usually beneficial to build one anyway. Prototypes help inventors flush out design problems and improve the invention in ways that may present commercial significance or marketing advantages. Prototypes also can make the patent application process much more easier and straightforward. With a physical prototype, the drawings can be prepared very quickly and with a much slighter chance of errors, and the patent attorney can draft the application with much more clarity and precision because he truly knows what every part of the invention is.


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Super Lawyers 2014 Southwest Rising Stars Selection

I’m happy to report that I have been selected, for the second year running, as a Super Lawyers Southwest Rising Stars.  The patented process for selecting the best attorneys uses peer nominations and third-party research.  Only 2.5% of attorneys are selected to the Rising Stars list, and I feel honored to be among them for the second year in a row.  This comes just a few days after I bested my Ironman PR at 10:31:13, so it has been an especially great week!

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Offers for Sale in the Post-AIA World

The US has been operating under the full enacted provisions of the America Invents Act for over six months now, and some of the questions presented by the new law have been answered. However, one area of uncertainty – troubling uncertainty – is the modification to the on-sale bar statutory provision and what the effects of a non-disclosure agreement may or may not be in the context of an offer for sale.

The AIA changed the way prior art and potentially patent-barring disclosures are defined. One provision states that, with exceptions, the invention is not patentable if it “was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.”

Practitioners, academics, and other professionals split on the correct interpretation of the new law. One camp has believes that the phrase “otherwise available to the public” qualifies the “on sale” portion of the law, in which case an offer for sale made under the protection of a confidentiality agreement would not be a barring event. On the other hand, some say that the phrase doesn’t modify the “on sale” portion, arguing that the the pre-AIA case law which adopts this reasoning still holds. The latter interpretation would render meaningless, for patentability’s sake, a non-disclosure agreement in the context of an offer for sale, though the NDA would still be an effective contract tool.

The Patent Office sides with the first camp, saying that a secret sale or use, or an offer for sale made under the protection of a confidentiality or non-disclosure agreement, will not be considered prior art against the invention. The Office claims that this was the intent of Congress. Unfortunately, what the Patent Office uses as a guideline and what the courts may ultimately decide need not coincide. The courts are not at all required to follow any rules of the Patent Office. Because so few patents have yet been issued under the new AIA rules, however, it will likely be some time before those cases are litigated and appealed, and probably even more time until one of the appealed cases raises the issue of whether an on-sale bar occurred in the context of a confidential offer for sale.

Until that point, it is up to the client to decide how to proceed. Best practices may dictate that the more conservative route be taken, that it is assumed an offer for sale even under an NDA will not be protected, and that an application (likely a provisional) should be filed before any secret offers for sale are made. On the other hand, if a client believes that the Patent Office rule should hold, then it can proceed with making secret offers and uses of the invention without filing pre-disclosure application.

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Patent Office Will Remain Open Despite Possible Shutdown

The Patent and Trademark Office is unlikely to be closed if a government shutdown takes place tonight.  The Office has a great deal of control over its own budget, and it maintains a reserve fund of money for certain situations which will keep it up and running should the rest of the government be furloughed or closed.  The Office can run for about a month before the funds are exhausted, which should provide enough time for Congress to come to a decision.  And even then, the Office should still be able to accept filings in new and continuing patent and trademark applications.  The Office reports:

In the event of a general government shutdown on October 1, 2013, the United States Patent and Trademark Office will remain open, using prior year reserve fee collections to operate as usual for approximately four weeks. We continue to assess our fee collections compared to our operating requirements to determine how long we will be able to operate in this capacity during a general government shutdown. We will provide an update as more definitive information becomes available.

Should we exhaust these reserve funds before a general government shutdown comes to an end, USPTO would shut down at that time, although a very small staff would continue to work to accept new applications and maintain IT infrastructure, among other functions. (Should it become necessary for USPTO to shut down, details of the agency’s plan for an orderly shutdown are available on page 78 of the United States Department of Commerce’s shutdown plan, available here.)

Any new or updated public information related to USPTO operations during a potential government shutdown will be placed on this page.


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