Executive Intellectual Property Bulletin

LANDMARK CHANGES TO U.S. PATENT LAW

PTO Publishes Pending Patent Applications by Eduardo E. Drake
Patent High Court Squashes Equivalence by William F. Prout

PTO Publishes Pending Patent Applications
By Eduardo E. Drake
Non-Equity Partner, Registered Patent Attorney

Many provisions of the American Inventors Protection Act of 1999 became effective on November 29, 2000. Among the most important is one providing not only for publication of pending U.S. patent applications 18 months after filing but also for recovery of damages from early (pre-issuance) infringers of published applications that ultimately issue as patents.

Although this new publication mechanism affects all clients, from the smallest to the largest, we expect it to particularly benefit those in industries with shorter product cycles. These industries have generally viewed patents as having less strategic value because they generally didn't become enforceable in time to make them relevant to their businesses. Clients now have the option to initiate "immediate" publication of currently pending applications as well as pre-18-month publication of new applications, and thus place previously-immune infringers directly in the crosshairs of their pending applications.

Pre-issuance damages will be contingent on publication of claims that are substantially identical to claims that actually issue and on notifying infringers regarding subject applications. Thus, we will work with clients not only to maximize the likelihood that published applications include rigorous allowable claims of appropriate scope, but also to ensure earlier identification of potential infringers.

Clients may opt out of publication, provided their applications will not be filed internationally. Although doing so will sacrifice pre-issuance damages, it will also preserve the confidentiality of these applications, which in some circumstances may be the best choice. Thus, for every application, clients should weigh, with the aid of counsel, the merits of publication and its potential to bag early infringers against the benefits of maintaining confidentiality.

Patent High Court Squashes Equivalence
By William F. Prout
Associate, Registered Patent Attorney

The Court of Appeals for the Federal Circuit recently issued a surprise decision in the Festo case. If the decision survives appeal to the U.S. Supreme Court, it will dramatically restrict the scope of millions of patents, through virtual elimination of the Doctrine of Equivalents (DOE)--- the last safety net of patent holders seeking to stop theft of their inventions.

The Court held that prosecution history estoppel acts as a complete bar to the application of the DOE, for a claim element that has been narrowed, by an amendment, for a reason related to patentability. The Court also held that "a substantial reason related to patentability" includes amendments made to overcome rejections based on prior art, enablement, and indefiniteness. The upshot is that any amendment that narrows a patent claim leaves a potential escape hatch for infringers.

In the wake of Festo, there is no DOE for an element amended for a reason related to patentability. Therefore, all patent practitioners must be more vigilant than ever in understanding and assessing the risks of amending patent claims. The old adage "an ounce of prevention is worth a pound of cure" suggests that artful and thoughtful design of claims during preparation of applications can reduce the likelihood of having to amend claims later on.

To this end, expert practitioners should consider conducting tailored prior-art searches to locate potential references and drafting original claims around this art. In addition, the claims and specification should include numerous fallback positions to allow for making required claim amendments, without forfeiting any more subject matter than absolutely necessary. Finally, when faced with the prospect of amending claims to overcome questionable rejections, the attorney and client should balance loss of the DOE against the cost of appeal before relinquishing any claim scope.

If you have questions or comments, please contact bulletin author Eduardo Drake or William Prout or any other attorney at Schwegman, Lundberg & Woessner.