First- to-File Practice: Mandatory Derivation Proceedings?

This is the fourth article in my First-to-File Friday series. On each Friday in August, I am publishing an article that takes an in-depth look at one of the prior art exceptions of the first-to-file version of 35 USC § 102 which will apply to certain patent applications filed on or after March 16, 2013.

The USPTO has issued its proposed rules and proposed examination guidelines for implementing the first-to-file provisions of the America Invents Act (AIA), and will consider written comments received by October 5, 2012. In previous articles I have provided overviews of the proposed rules, the proposed examination guidelines, the proposed requirements for invoking the “grace period inventor disclosure” exception to prior art, the proposed requirements for invoking the “grace period non-inventor disclosure” exception to prior art, the proposed requirements for invoking the “grace period shielding disclosure” exception to prior art, and the expanded prior art exception for commonly owned patent applications. Here, I look at the proposed rule that could require an applicant to initiate a derivation proceeding.

The Prior Art Effect of Earlier-Filed, Later Published U.S. Patent Documents

The AIA version of 35 USC § 102(a)(2) provides that earlier filed, later published patent applications can qualify as prior art:

(a) NOVELTY; PRIOR ART.—A person shall be entitled to a patent unless—
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(2) the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.

This provision is similar to current § 102(e), but holds that an application can qualify as prior art as of its “effective filing date,” which can reach back to a foreign priority date, unlike § 102(e), which only reaches back to the earliest effective U.S. filing date.

The Exceptions to § 102(a)(2) Prior Art

Disclosures in earlier filed, later published applications that otherwise would qualify as prior art under § 102(a)(2) can be disqualified under circumstances similar to those available to disqualify other prior art “disclosures,”  as discussed in my previous articles relating to the “grace period non-inventor disclosure” exception to prior art and the “grace period shielding disclosure” exception to prior art:

(b) EXCEPTIONS.—
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(2) DISCLOSURES APPEARING IN APPLICATIONS AND PATENTS.—A disclosure shall not be prior art to a claimed invention under subsection (a)(2) if—
(A) the subject matter disclosed was obtained directly or indirectly from the inventor or a joint inventor;
(B) the subject matter disclosed had, before such subject matter was effectively filed under subsection (a)(2), been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor…

Additionally, disclosures in earlier filed, later published commonly owned applications can be disqualified under the newly expanded prior art exception for commonly owned patent applications:

(C) the subject matter disclosed and the claimed invention, not later than the effective filing date of the claimed invention, were owned by the same person or subject to an obligation of assignment to the same person.

The USPTO’s proposed rules outline procedures for invoking these exceptions in new 37 CFR § 130. I reviewed these requirements in the previous articles in my First-To-File Friday series. Here, I focus on the proposed rule that could require an applicant to initiate a derivation proceeding.

Proposed 37 CFR § 1.130

Proposed 37 CFR § 130 includes the following provision:

(f) … The Office may require the applicant to file a petition for a derivation proceeding pursuant to Sec. 42.401 et seq. of this title if the rejection is based upon a U.S. patent or U.S. patent application publication of a patented or pending application naming another inventor and the patent or pending application claims an invention that is the same or substantially the same as the applicant’s claimed invention.

Thus, by this rule, the USPTO asserts the authority to require an applicant to pursue a derivation proceeding. Neither the proposed rules nor the proposed examination guidelines discuss the circumstances under which the USPTO might exercise this authority.

Derivation Proceedings

The USPTO published its proposed rules for the new derivation proceedings on February 2, 2012. Some of the key requirements for bringing a derivation proceeding include:

• filing a petition within one year after the first publication of a claim to an invention that is the same or substantially the same as the earlier application’s claim to the allegedly derived invention.
• paying the derivation fee (proposed at $400).
• making a showing  that the petitioner has at least one claim that is (i) the same or substantially the same as the respondent’s claimed invention; and (ii) not patentably distinct from the invention disclosed to the respondent.
• demonstrating that an invention was derived from an inventor named in the petitioner’s application and, without authorization, the earliest application claiming such invention was filed.
• submission of substantial evidence, including at least one affidavit addressing communication of the derived invention and lack of authorization that, if unrebutted, would support a determination of derivation. The showing of communication must be corroborated.

These are substantial requirements that could be difficult to satisfy within a standard response period.

Risks of Premature Derivation Proceedings

One concern that I have with the new derivation proceedings, and with the USPTO’s asserted authority to require an applicant to pursue a derivation proceeding, relates to premature derivation proceedings. With current interference practice, the USPTO will not declare an interference unless and until the potentially interfering claims are otherwise patentable to each applicant. For derivation proceedings, however, the applicant of the later-filed application has to file a petition within one year of the first publication of a relevant claim in the earlier application, even if that claim has not yet undergone examination and may not be patentable. Although the USPTO has discretion to defer action on a petition for a derivation proceeding until after a patent is granted, the rules (and statute) still require the applicant to file the petition and make the required showings early on.