USPTO Implements Significant Patent Term Adjustment Changes Pursuant to the AIA Technical Corrections Act

On April 1, 2013, the USPTO published an “interim final rule” relating to Patent Term Adjustment (PTA), to implement changes to the PTA statute embodied in the AIA Technical Corrections Act. Although the rule changes have an immediate effective date, the USPTO will consider written comments submitted within 60 days, e.g., by May 31, 2013.

The AIA Technical Corrections Act

The AIA Technical Corrections Act, which stemmed from HR 6621, made several substantive changes to the PTA statute.

One set of changes impacts PTA for U.S. national stage applications, by treating “commencement of the national stage” as equivalent to the filing date of a direct U.S. application (an application filed under 35 USC § 111(a)). These changes impact the calculation of “A delay” and “B delay,” and are embodied in amendments to § 154(b)(1)(A) and (B). Another change permits the USPTO to provide its initial PTA determination “no later than the date of issuance of the patent,” rather than with the Notice of Allowance. This change is reflected in amendments to § 154(b)(3). A more significant change impacts appeals of PTA determinations by amending § 154(b)(4).

(Please see this article for a more detailed discussion of the potential impact of these changes.)

By the terms of the AIA Technical Corrections Act, these statutory changes took effect on January 14, 2013 (the date of enactment) and apply to “proceedings commenced on or after” that date. According to the USPTO, a PTA “proceeding” commences when the USPTO provides its PTA determination when a patent is granted. Thus, the USPTO has determined that most of these rule changes apply to patents granted on or after January 14, 2013, even though the USPTO has not yet followed the new procedures.

Changes Relating to U.S. National Stage Applications

37 CFR § 1.702 is amended by revising paragraph (a)(1) to provide that the fourteen month clock for issuing a first Office Action or Notice of Allowance in a U.S. national stage application begins to run against the USPTO on the date of commencement of the national stage.

§ 1.702 Grounds for adjustment of patent term due to examination delay under the Patent Term Guarantee Act of 1999 (original applications, other than designs, filed on or after May 29, 2000).
(a) * * *
(1) Mail at least one of a notification under 35 U.S.C. 132 or a notice of allowance under 35 U.S.C. 151 not later than fourteen months after the date on which the application was filed under 35 U.S.C. 111(a) or the date the national stage commenced under 35 U.S.C. 371(b) or (f) in an international application;
* * * * *
(b) Three-year pendency. * * *

Under the original statute and previous rule, this fourteen month clock did not start running until “the date on which an international application fulfilled the requirements of section 371,” including the submission of an executed Inventor Oath/Declaration. This change permits U.S. national stage applicants to take advantage of the new ability to delay submission of an executed Inventor Oath/Declaration without risking a loss of potential PTA, because commencement of the national stage does not require submission of an executed Inventor Oath/Declaration.

Parallel changes are made to 37 CFR § 1.703:

§ 1.703 Period of adjustment of patent term due to examination delay.
(a) * * *
(1) The number of days, if any, in the period beginning on the day after the date that is fourteen months after the date on which the application was filed under 35 U.S.C. 111(a) or the date the national stage commenced under 35 U.S.C. 371(b) or (f) in an international application and ending on the date of mailing of either an action under 35 U.S.C. 132, or a notice of allowance under 35 U.S.C. 151, whichever occurs first;
* * * * *

The AIA Technical Corrections Act also amended the PTA statute to provide that the three-year period in 35 USC § 154(b)(1)(B) is measured from “the date of commencement of the national stage under 35 U.S.C. 371” for U.S. national stage applications. According to the Federal Register Notice, no rule change was necessary to implement this statutory change, because the USPTO already interpreted the previous statutory language (“actual filing date of the application in the United States”) as meaning the date of commencement of the national stage under 35 U.S.C. 371” for an international application.

Changes Relating to the USPTO’s PTA Determination

37 CFR § 1.705 is amended to provide that the USPTO will provide its PTA determination with the granted patent (only), and to make the two month period for filing a request for reconsideration extendable. The changes to this rule also remove paragraphs (d) and (e) and redesignate paragraph (f) as paragraph (d).

§ 1.705 Patent term adjustment determination.
(a) The patent will include notification of any patent term adjustment under 35 U.S.C. 154(b).
(b) Any request for reconsideration of the patent term adjustment indicated on the patent must be by way of an application for patent term adjustment filed no later than two months from the date the patent was granted. This two-month time period may be extended under the provisions of § 1.136(a). An application for patent term adjustment under this section must be accompanied by:
* * * * *

These are significant changes to the PTA procedures. Under the AIA Technical Corrections Act, the USPTO is no longer required to provide its initial PTA determination with the Notice of Allowance, but rather only when the patent grants. According to commentary in the Federal Register Notice:

The Office plans to continue to provide an indication of the patent term adjustment with the issue notification [which usually is mailed two weeks before the patent grants], but the patent term adjustment under 35 U.S.C. 154(b) indicated on the patent is the “official” notification of the Office’s patent term adjustment determination.

While the rules retain the previous two month post-grant period for challenging a PTA award, the rules now make this time period extendable as a matter of right under 37 CFR § 1.136(a) for up to five additional months.

The Catch-22 of 35 USC § 154(b)(3)(C) & 37 CFR § 1.705(c)

Although the AIA Technical Corrections Act postponed when the USPTO must provide its PTA determination until a patent’s grant date, it did not make corresponding changes to 35 USC § 154(b)(3)(C). This section of the PTA statute provides for reinstatement of all or part of the period of adjustment reduced pursuant to 35 USC § 154(b)(2)(C) if the applicant makes a showing that, in spite of all due care, the applicant was unable to respond within the three-month period. This section of the PTA statute requires that such a showing be made “prior to the issuance of the patent.” Thus, a request for reinstatement under 35 USC § 154(b)(3)(C) (implemented in 37 CFR § 1.705(c)) still must be filed prior to the issuance of the patent.

37 CFR § 1.705(c) is amended to read as follows, to conform to other changes in the PTA rules:

§ 1.705 Patent term adjustment determination.
*****
(c) Any request for reinstatement of all or part of the period of adjustment reduced pursuant to § 1.704(b) for failing to reply to a rejection, objection, argument, or other request within three months of the date of mailing of the Office communication notifying the applicant of the rejection, objection, argument, or other request must be filed prior to the issuance of the patent. This time period is not extendable. Any request for reinstatement of all or part of the period of adjustment reduced pursuant to § 1.704(b) under this paragraph must also be accompanied by:
* * * * *

37 CFR § 1.704 is amended to conform to the revisions to 37 CFR § 1.705(c) as follows:

§ 1.704 Reduction of period of adjustment of patent term.
* * * * *
(e) The submission of a request under § 1.705(c) for reinstatement of reduced patent term adjustment will not be considered a failure to engage in reasonable efforts to conclude prosecution (processing or examination) of the application under paragraph (c)(10) of this section.

The USPTO has not provided any further guidance as to when or how applicants should submit a request for reinstatement under § 1.705(c) prior to grant, when the USPTO does not provide its PTA determination until grant. In effect, applicants seeking to avail themselves of 35 USC § 154(b)(3)(C) will have to request “reinstatement” before the USPTO makes any “reduc[tion] pursuant to 35 USC § 154(b)(2)(C).” It is likely that applicants will know in advance when such a reduction is likely to be taken, and so applicants presumably could submit a request for “reinstatement” at any convenient time before grant, such as when the delayed response is filed or when the Issue Fee is paid.

Changes to District Court Civil Actions Challenging PTA Awards

Another significant change to the PTA statute effected by the AIA Technical Corrections Act relates to when a patentee can bring a district court civil action to challenge a PTA award. As originally enacted, the right to bring a district court civil action was independent of any request for reconsideration pursued within the USPTO. The USPTO has interpreted the AIA Technical Corrections Act as conditioning the right to bring a district court civil action on having requested reconsideration within the USPTO. The USPTO’s interpretation is set forth in the Federal Register notice:

The AIA Technical Corrections Act amends 35 U.S.C. 154(b)(4) to change “[a]n applicant dissatisfied with a determination made by the Director under paragraph (3) shall have remedy by a civil action against the Director filed in the United States District Court for the Eastern District of Virginia within 180 days after the grant of the patent” to “[a]n applicant dissatisfied with the Director’s decision on the applicant’s request for reconsideration under paragraph (3)(B)(ii) shall have exclusive remedy by a civil action against the Director filed in the United States District Court for the Eastern District of Virginia within 180 days after the date of the Director’s decision on the applicant’s request for reconsideration.” See 126 Stat. at 2457.

This change to 35 U.S.C. 154(b)(4) clarifies that: (1) a civil action under 35 U.S.C. 154(b)(4) is not an alternative to requesting reconsideration of a patent term adjustment under 35 U.S.C. 154(b)(3), but is the remedy for an applicant who is dissatisfied with the Director’s decision on the applicant’s request for reconsideration; and (2) a civil action under 35 U.S.C. 154(b)(4) is the exclusive remedy for an applicant who is dissatisfied with the Director’s decision on the applicant’s request for reconsideration.

Under this interpretation of 35 USC § 154(b)(4), a patentee seeking judicial review of a PTA award first will have to file a request for reconsideration of PTA with the USPTO within seven months of the patent’s grant date, obtain the USPTO’s decision on the request for reconsideration, and bring a district court civil action with 180 days of the USPTO’s decision on the request for reconsideration.

Effective Dates

According to the Federal Register Notice, the changes to 37 CFR § 1.702, 1.703, and 1.705 apply to any patent granted on or after January 14, 2013 (the effective date of the AIA Technical Corrections Act), while the changes to 37 CFR § 1.704 apply to any application in which a notice of allowance was mailed on or after April 1, 2013.

Public Comments

The Federal Register Notice states that “good cause exists to make these procedural changes without prior notice and opportunity for comment and to be effective immediately so as to avoid inconsistency between the provisions of 37 CFR 1.702 through 1.705 and 35 U.S.C. 154(b) as amended by the AIA Technical Corrections Act.” Nevertheless, the USPTO is implementing these rule changes as “an interim rule to allow for public comments because the Office seeks the benefit of the public’s views on the Office’s implementation of the changes to 35 U.S.C. 154(b) in the AIA Technical Corrections Act.”

As noted above, the USPTO will consider written comments on these rule changes received within 60 days of the April 1, 2013 Federal Register Notices, e.g., by May 31, 2013. The USPTO prefers that comments be sent by email to [email protected] or via the Federal eRulemaking Portal.