America Invents Phase 2 Implemented


At 12:01 am on Sunday morning, September 16, 2012, phase 2 of the America Invents Act (AIA) went into effect.  This is the culmination of many months of work on the part of the United States Patent and Trademark Office to first propose the necessary rules and then consider all of the comments received, finally implementing final rules in July and August.

No fewer than seven substantive rule sets have been implemented on time to meet the legislation’s September 16, 2012, effective date.  The new rules are as follows:

The USPTO issued a rather self-congratulatory press release on Monday, and the White House got in on the AIA celebration with an article by Quentin Palfry, which similarly published Monday.

“These new AIA provisions now in effect give us tools to deliver cutting-edge technologies to the marketplace sooner, further reducing the backlog of patent applications, and getting high-quality patents issued faster,” said Under Secretary of Commerce for Intellectual Property and Director of the USPTO David Kappos. “And that will translate into opportunity, growth, and jobs for large and small innovators across America.”

Frankly, I don’t know that the AIA will create much job growth outside of the patent practitioner community, but after a number of years with the patent practice industry bumping along, losing the largest names in our space and watching outsourcing of legal work move jobs abroad, jobs in the patent practice sector will be much appreciated.

Sure back slapping and victory laps do not typically make for warm and fuzzy feelings, but who can really blame them for their exuberance.  This was a mountain of work for the Patent Office and as far as I can tell they have done a very good job.  The USPTO even took public comments into consideration in numerous places and made changes to the proposed rules.  That alone would have been unthinkable in Administrations past.  And let’s also not forget that the USPTO had to get the rules to the Office of Management and Budget with enough time for OMB consideration, so the USPTO timetable to get this complete was extremely compressed.  The USPTO deserves a victory lap and notice by the White House for its accomplishments.

Now we prepare to move forward with the largest changes to patent law in many generations.  The first-to-file changes are on the horizon for March 16, 2013, and there will be much to discuss about that as it approaches.  While there may be a fiscal cliff approaching for the country at large, at least if you listen to the media, there is most assuredly a patent cliff approaching.  The rules pertaining to implementation of first-to-file will need to be considered carefully by every patent practitioner and every client.

There will be numerous considerations that will have to be taken into account as we move forward toward first-to-file.  These include:

1. How will you engage clients in a first-to-file era?  Do you give them estimates with respect to the time it will take to complete projects and file applications, getting them to accept that timetable in advance?  Do you recommend always filing provisional patent applications to get at least something on file?

2. What about claiming priority on or after March 16, 2012?  Regardless of whether it is a provisional patent application or a continuation-in-part, there will be monumental issues relative to claiming priority to an earlier filed first-to-invent application in a later-filed first-to-file regime.  You absolutely should be preparing your clients to file any and all non-provisional patent applications or continuations-in-part on or before March 15, 2013.

3. What do you tell clients about the language of the America Invents Act that isn’t quite exactly the language that we are used to from the previous statute and caes?  More importantly, are your clients prepared for the possibility (if not likelihood) that the courts will be asked to get involved and may well make unforeseeable determinations?

Everything that we have seen up to this point is simply a dress rehearsal.  For better or for worse, Congress decided to throw out the baby with the bath water insofar as novelty is concerned.  They did not use the same old familiar terminology, and they effectively turned upside down our understanding of what is prior art.  Since prior art is at the heart of just about everything we do, this will be an uncertain time for quite a while.  That is typically good news for the lawyers, but will also come with some real risks.  Make sure your malpractice is paid up; tail coverage may become particularly valuable moving forward as well.

One thing that is virtually certain is this — things are going to be interesting and unpredictable.  And before anyone gets on a high horse to tell me I am wrong and the AIA is brilliantly and clearly written, ask yourself a very simple question.  How many times does a Federal Circuit decision surprise you?  Then ask this — how many times do you think the Federal Circuit gets it wrong?

If that doesn’t scare you nearly to death, I don’t know what will.


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