Patent Law

On Sept. 16, 2011 President Barack Obama signed the Leahy-Smith America Invents Act (AIA) into law. The legislation enacts the most significant change to U.S. patent law in 60 years. The law presents several changes to the previous system—some dramatic and some minor.

Lawyers involved in intellectual property cases will need to be aware of the AIA and its implications. Here are five key ways that the AIA has amended U.S. patent law.

1. A First-to-file System

History is full of incidences of multiple inventors working on identical or similar inventions—Alexander Graham Bell and Elisha Gray patented the telephone on the same day. The AIA switches the current first-to-invent system to a first-to-file system for patent applications after March 16, 2013. Henceforth, patents will be granted to the first inventor to file for a patent. This will eliminate interference proceedings, in which a party that failed to file a patent on time could challenge the inventorship of another party that was granted that patent.

2. Tax Strategy Inventions

Not surprisingly, the U.S. government isn’t keen on inventions that help people get out of paying their taxes. As such the AIA provides that any strategy for reducing, avoiding or deferring tax liability will not be sufficient to differentiate a claimed invention from prior art.

3. Micro-entity

According to the AIA for an inventor to achieve micro entity status, he needs to have grossed less than 3 times the national mean household income during the previous calendar year. The inventor must have also filed no more than four non-provisional patent applications, barring those that the inventor was obligated to assign to an employer. Eligible inventors will be able to enjoy a 75% reduction for many of their patent fees when filing for a new patent.

4. Best Mode

Inventors were previously required to submit the best mode for accomplishing their invention, detailing how to bring that invention to fruition. While the AIA still requires inventors to submit the best mode, it establishes that failure to include this information will not be a basis for rendering a patent unenforceable, thereby eliminating this requirement as a defense to patent infringement. This has caused some speculation as to why a best mode requirement has been preserved at all.

5. Prior user rights

According to the AIA, if a user of an invention begins using an invention more than a year prior to a patent being filed by a subsequent inventor, the user will retain the right to consider using that invention in the same way that they had prior to the patent being filed. These prior user rights have limited scope.

These are just some ways that the Leahy-Smith America Invents Act of 2011 changes patent law. Litigators might best be served by retaining a patent law expert in order to fully understand the implications of the AIA and how it might affect an intellectual property case involving patent law.