Patent Docs

In re Sullivan (Fed. Cir. 2007)

    By Kevin E. Noonan --

Easily lost in the understandable outrage over the new PTO continuation rules, the Board of Patent Appeals and Interferences is proceeding to chart the metes and bounds of the PTO's reaction to the Supreme Court's decision in KSR Int'l Co. v. Teleflex Inc. (see Patent Docs report).  Fortunately, the Federal Circuit's jurisprudence survived Supreme Court scrutiny with sufficient remaining vitality for the CAFC to continue to exercise oversight over the Board's more arbitrary application of the "new" obviousness standard explicated in KSR.  As it has done in the recent Ex parte Kubin case (see Patent Docs report), the Board misapplies the Supreme Court's decision, and in doing so appears ready to revive the times in the early 1990's when the PTO was noted more for denying than for granting patents in biotechnology.

The technology at issue involves immunological reagents for neutralizing snake venom (specifically rattlesnake venom).  The antiserum comprised F(ab) fragments of horse antibodies raised against the venom, and an understanding of the issues in the case requires a brief synopsis of antibody technology.  Antibodies are produced in a form represented by a "Y" (at right), where the stem of the Y represents effector functions for interaction with other components of the immune system (and that are shared by any antibody of particular type regardless of its antigenic specificity), and the two "arm" portions, each of which provide the particular antibodies antigenic specificity.  Also known in the art are proteolytic fragments of antibodies; proteolytic cleavage at a position in the antibody stem results in F(ab)2 fragments (at left) comprising both copies of the antigen-specific arm portions of the antibody.  F(ab) fragments (at left), in contrast, are produced by proteolytic cleavage that separates the two antigen-specific portions of the antibody.  Thus, F(ab) fragments have half the antigen-binding capacity of an equal number of F(ab)2 fragments.

The claims at issue are represented by the following claim:

An antivenom composition comprising Fab fragments which bind specifically to a venom of a snake of the Crotalus genus and which are essentially free from contaminating Fc as determined by immunoelectrophoresis using anti-Fc antibodies, and a pharmaceutically acceptable carrier.

The claims were initially rejected under 35 U.S.C. § 103 for obviousness over prior art disclosure of horse antibodies against rattlesnake venom, in combination with art disclosing production of F(ab) fragments from whole antibodies for use in detecting venom from an Australian brown snake.  The Board in its first decision on these claims found that reciting that the composition was an "antivenom" was not sufficient to distinguish the invention from the art, since it represented merely an intended use.  In response to the Board's decision, Sullivan amended the claims as follows:

An antivenom pharmaceutical composition for treating a snakebite victim, comprising Fab fragments which bind specifically to a venom of a snake of the Crotalus genus and which are essentially free from contaminating Fc as determined by immunoelectrophoresis using anti-Fc antibodies, and a pharmaceutically acceptable carrier, wherein said antivenom pharmaceutical composition neutralizes the lethality of the venom of a snake of the Crotalus genus.

The Examiner did not find these amendments persuasive, maintaining rejection under § 103 for obviousness over the same references.  The Board affirmed, finding that reciting that the claim encompassed an "antivenom pharmaceutical composition" was no more effective at distinguishing the prior art than the originally-presented (and rejected) claim, being merely a recitation of an intended use.  Regarding the functional limitation regarding venom neutralization, the Board held that the secondary reference taught that F(ab) fragments could neutralize snake venom in mice, and thus that this limitation did not render the claims patentable.  Importantly, the Board asserted in a footnote that:

"[t]he remainder of appellants arguments on this record, in addition to the Declarations of record, relate to the use of the claimed composition as an antivenom.  Since we have placed [no] weight on the intended use of appellants' composition we do not address these arguments or the Declarations."

This failure to consider the declaration evidence proved fatal to the Board's decision.  These declarations included two by the inventors and a third by an independent expert.  Sullivan contended that these declarations described "how the prior art taught away from using Fab fragments to neutralize rattlesnake venom, how a person having ordinary skill in the art would not have known how to use Fab fragments to neutralize rattlesnake venom, and how Fab fragment antivenom exhibits an unexpected property." In addition, Sullivan argued that this evidence was relevant to the secondary considerations under the Supreme Court's Graham v. John Deere Co. analytical framework, and that the Board erred for refusing to consider it.

The Federal Circuit agreed, and accepted the PTO's contention that it had established a prima facie case of obviousness of the claimed invention over the prior art of antivenom antibodies and methods for making F(ab) fragments from them.  Citing KSR, the CAFC stated that "if a technique has been used to improve one device, and a person of ordinary skill in the art would recognize that it would improve similar devices in the same way, using the technique is obvious unless its actual application is beyond his or her skill" in making this determination.  But making out a prima facie case is not enough.  Once the prima facie case is made, the burden shifts to the applicant to rebut it.  Rebuttal depends on evidence, such as the declaration evidence supplied by Sullivan but not considered by the Examiner or the Board.  The Federal Circuit held that the Board was obligated to consider this evidence, which was directed to relevant issues relating to the question of non-obviousness.  The evidence included applicants' distinctions over the art, including why the skilled worker would not have expected F(ab) fragments to be effective in neutralizing venom because inter alia it is more readily cleared from a bitten animal's circulation (in contrast to the venom itself which persists in the individual).  The Federal Circuit rejected the Board's contention that the evidence related merely to the intended use of the antivenom composition, stating that the evidence related to unexpected results, teaching away by the prior art, and the long-felt need in the art.  The CAFC agreed that recitation of an intended use of a known compound could not impart patentability to the compound, but noted that the claimed F(ab) fragments were not known (there were no rejections based on § 102), and the question of non-obviousness required consideration of all evidence of record.  Since the Board did not consider Sullivan's rebuttal evidence, the Federal Circuit vacated the decision and remanded the case back to the Board.

For Sullivan, the decision does nothing more than put the obviousness question back before the Board for reconsideration in view of the rebuttal evidence.  For the rest of us, however, it is a reminder to the Board that it must consider all the relevant evidence even under the post-KSR climate that is more permissive to the PTO asserting that an invention is obvious.  It is at least minimally reassuring that the Federal Circuit has not responded to the recent spate of negative commentary and reversals by the Supreme Court by abnegating its role in assuring that the PTO apply the law, rather than their own (hindsight-informed) opinions, in making obviousness determinations.

In re Sullivan (Fed. Cir. 2007)
Panel: Circuit Judges Newman, Lourie, and Gajarsa
Opinion by Circuit Judge Lourie

Additional information regarding this case can be found at Patently-O.

Inventor Sues PTO to Prevent New Continuation Rules from Taking Effect

Tafas v. Dudas, No. 07CV846 (E.D. Va.) (filed Aug. 22, 2007)

    By Robert Dailey --

Dr. Triantafyllos Tafas, a Connecticut inventor, has asked a Federal District Court to prevent the PTO's new continuation rules from taking effect.  Tafas is the named inventor on 18 pending patent applications, and asserts that he will suffer injury when the new rules become effective on November 1 of this year.  (Tafas is the founder of Ikonisys, Inc.)

Tafas primarily objects to the PTO's changes to 37 C.F.R. § 1.78.  First, the new Rule 78 places limitations on the filing of third and subsequent continuing applications (including divisionals and CIPs).  If third and subsequent continuing applications fail to comply with the strictures of the new rule, the PTO can deny the patentee the benefit of the earlier filing date.  Second, the new Rule 78 contains additional requirements for patentees who file multiple applications having overlapping disclosures within two months of each other.  In addition, Tafas objects to the changes to Rule 75 that require patentees to submit additional documentation when an application has more than 5 independent claims or 25 total claims.

Tafas claims that the new rules offend the Constitution, the Administrative Procedure Act (APA), and the Patent Act.

Constitutional arguments

His Constitutional attack is two-pronged.  On the first prong, he argues that the new rules violate Article I, Section 8, Clause 8 because they fail to promote the progress of science and the useful arts.  This argument likely misses the mark.  The Clause, after all, simply grants Congress the power to create a patent system without ever requiring that Congress create patent rights of any kind.

On the second prong, Tafas argues that the new rules violate the Takings Clause of the Fifth Amendment.  The rule changes will likely increase the costs of patent procurement, and will place a higher value on obtaining competent patent counsel.  This is especially true for patentees who drafted pending applications under the belief that the PTO would grant an unlimited number of continuations.  But these additional burdens are probably too speculative and indirect to form the basis of a Takings Clause violation.

Statutory arguments

Tafas asserts a host of violations of the APA and the Patent Act.  Although the complaint fails to flesh out these arguments in detail, one line of reasoning seems particularly persuasive.  In the following paragraphs, I have attempted to lay out the rough details of this argument.

Section 120 of the Patent Act provides that:

An application for patent for an invention disclosed in the manner provided by the first paragraph of section 112 . . . in an application previously filed in the United States, . . . which is filed by an inventor or inventors named in the previously filed application shall have the same effect, as to such invention, as though filed on the date of the prior application, if filed before the patenting or abandonment of or termination of proceedings on the first application or on an application similarly entitled to the benefit of the filing date of the first application and if it contains or is amended to contain a specific reference to the earlier filed application.

Furthermore, Section 132(b) provides that:

The Director shall prescribe regulations to provide for the continued examination of applications for patent at the request of the applicant.  The Director may establish appropriate fees for such continued examination.

Section 706(2)(A) of the APA (5 U.S.C. § 706(2)(A)) requires a reviewing court to set aside any agency action (i.e., PTO rulemaking) that is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law."

Section 120 of the Patent Act broadly grants priority to continuing applications with the exclusive requirement that an earlier-filed application be co-pending.  Under the new Rule 78, filers of third and subsequent continuing applications could face a loss of priority in certain situations.  Therefore, the new rule appears to deny priority under circumstances where the Patent Act expressly grants priority.  Under this analysis, the PTO's new Rule 78 would not be in accordance with the patent laws established by Congress.

Moreover, Section 132(b) requires that the PTO examine all continuing applications, and grants the agency authority to establish appropriate fees.  Yet the new Rule 78 would permit the PTO to avoid examining some third and subsequent continuing applications.  This too reveals a possible contradiction between the new Rule and the patent laws.  Section 132(b) nowhere permits the PTO to withhold examination of an application that otherwise complies with the statutory requirements of the Patent Act.  The PTO can only ask for more money; it cannot toss the application into the trash.

Of course, the PTO may argue that Sections 120 and 132(b) are simply silent regarding the issues encompassed by new Rule 78.  Thus, the PTO only needs to show that its new rules are not arbitrary and capricious.  In short, Tafas' success will likely depend on how broadly or how narrowly the courts interpret Sections 120 and 132(b).

Tafas has requested that the District Court hear arguments on his motion for a preliminary injunction within the coming weeks.

• Tafas' complaint can be viewed here.

• Tafas' motion for a preliminary injunction can be viewed here.

• The declaration of Tafas accompanying the PI motion can be viewed here.

Robert Dailey, Ph.D., is a physical chemist and regular Patent Docs contributor.  Dr. Dailey, who recently completed his studies at the University of North Carolina School of Law and passed the patent registration exam, will be joining MBHB this fall.

USPTO News: Patent Office Provides Recorded Web-Based Discussion of New Rules

    By Christopher P. Singer --

On Thursday, August 23, 2007, the USPTO held a webcast to discuss the changes to the rules relating to claims and continuation practice.  The presentation was recorded and is available for viewing until February 1, 2008.  The presentation can be viewed, without any password, here.  The new rules will become effective on November 1, 2007.  Patent Docs plans to continue to provide more description and commentary regarding certain aspects of the rule changes in the upcoming weeks.

West LEGALworks® CLE on New Continuation and Claims Rules

West LEGALworks® will be offering a webcast entitled:  "Assessing the New USPTO Multi-Patent Rules" on September 6, 2007 from 12:30-2:00 PM (EST).  Speakers Steven S. Baik, Partner of Orrick, Herrington & Sutcliffe LLP; F. Leslie Bessenger III of Finnegan, Henderson, Farabow, Garrett & Dunner, LLP; Courtenay C. Brinckerhoff of Foley & Lardner LLP; and Lawrence S. Pope of Mayer, Brown, Rowe & Maw LLP will explore how the new continuation and claims rules will affect patent applications and discuss how attorneys will need to rethink their patent practice in light of the new rules.  According to Thomson-West, the speakers will cover such issues as:

• New claim strategies in light of the onerous Examination Support Document requirement.
• Effect of the new rules on the scope of claim protection on existing patent applications.
• The necessity of early appeals.
• How will the new rules affect pharmaceutical, chemical and biotechnology companies?
• USPTO's criteria for approving requests for continuations.
• Multiple applications with claims that the USPTO could consider "patentably indistinct."
• How will the new rules affect litigation?
• The future of the Rules.

The registration fee for this webcast is $150.  Those interested in registering for the webcast, can do so here.

New PTO Continuation Rules: Unfair to Biotech?

    Guest Post by Simon J. Elliott and Courtenay C. Brinckerhoff --

On August 21, 2007, the U.S. Patent and Trademark Office (PTO) released final rules limiting a patent applicant's opportunities to pursue patent protection for a given invention.  The PTO rules do this by restricting the number of patent applications that can be filed to the same basic invention to one original application and two continuations or continuations-in-part (CIPs), and by restricting a patent applicant to only a single request for continued examination (RCE) in a patent family.  The PTO will permit additional continuations or RCEs only if the applicant can establish to the PTO's satisfaction that the new amendment, argument or evidence "could not have been submitted earlier."  See 37 C.F.R. 1.78(d).

When the PTO published the proposed rules in January of 2006, they were met with unprecedented resistance and public outcry at the restrictions they would place on patent applicants.  In an attempt to quell such concerns, the final rules were extensively modified, and the PTO asserts that the new rules will affect less than 3% of patent applications.  This would still affect nearly 4,000 applications, based on numbers presented by the PTO.  Patent scholar Mark Lemley, scoffing at the idea that the rules would have any significant impact, believes the numbers will be even lower, affecting "10 applications a year, maybe 50, out of 450,000."  Stuart Weinberg, "Inventor Sues U.S. Patent Office to Block New Continuation Rules," Dow Jones Newswires, Aug. 23, 2007.  The bases for these low numbers have not been verified, however, and serious errors have been identified in the PTO's continuation application metrics in other contexts.  See, e.g., Stuart J.H. Graham, Behind the Patent's Veil: Innovators' Uses of Patent Continuation Practice, 1975-2002, GaTech TI:GER Working Paper Series (conducting a statistical analysis of continuation filings at the PTO and the economic and legal reasons for filing continuations).  Indeed, many biotechnology industry representatives probably could identify at least 10 patent applications per client that will be negatively impacted by the new rules.

Biotechnology industry representatives are loudly protesting the new rules, arguing that they overlook the legitimate need for a liberal continuation practice in the biotech industry.  Is biotech over-reacting?  Or did the PTO fail to consider the disparate impact the new rules would have on this burgeoning industry?

Continuations Are Common in Biotech and Are Associated with Patent Value

Since at least 1975, continuations (including CIPs and RCEs) have been more popular in biotech, pharmaceutical and chemical fields than in other technologies.  For example, in 1995-1999, continued patents amounted to 41% of drug and health-related patents and 39.4% of chemical patents, but only 25.1% of electronic and 21.6% of mechanical patents.  Graham, supra.  Continuations are commonly used by key players in the biotech industry.  From 1995-1999, continuations accounted for 70-80% of patents to the top biotechnology firms, i.e., Amgen, Chiron, Genentech and Immunex.  See Graham, supra.

Using litigation as a proxy for patent value reveals that continuations may be among a patent owner's most valuable assets.  While the average non-litigated patent resulted from an average of only 1.54 applications (e.g., an average of fewer than one continuation), the average litigated patent resulted from an average of 2.57 applications (e.g., an average of between one and two continuations).  Graham, supra.  While biotech-specific data are not available, it is reasonable to assume that litigated biotech patents often are first, second or even third generation continuations, based on the high proportion of continuations that are filed by the biotech industry.  With the new rules effectively limiting patent applicants to only two continuations, the biotech industry is likely to find their most valuable patents impacted by the new restrictions.

Patent Practice Differs Across Technologies

When explaining the need for the new rules and their predicted impact, the PTO speaks of patents as a class, ignoring fundamental differences across technical fields.  For example, in the fields of electronics and software, rapidly moving technology, unimpeded by regulatory barriers, means that new inventions are rapidly commercialized and patents often are most valuable at the beginning of their terms.  An electronics product may be protected by hundreds of patents, but their commercially effective life may be only a few years, after which they are displaced by next-generation technology.  In contrast, it takes many years to bring a biotechnology invention to market, particularly where the product requires FDA approval.  Moreover, biotech and pharmaceutical products are typically protected by a small number of patents, often stemming from the same family.  In these fields, a patent is valuable initially to gain the investor support required to navigate the regulatory review process, but maximum commercial value often is not realized until the end of a patent's term, when the patent owner finally is able to commercialize its product.

As for patent prosecution, in the "predictable arts" of electronics and mechanical inventions, patentability usually depends on distinguishing the prior art.  On the other hand, in "unpredictable arts" such as biotechnology and pharmaceuticals, questions of enablement, utility, written description and definiteness also arise.  Even prior art issues may be more difficult in biotech applications, because when the technology is very new, the nomenclature is still evolving, and the same product may be called by different names, depending on the means used to discover it.  For example, a receptor protein for the AIDS virus might be identified by its DNA sequence, protein sequence, structural motifs, recognition by an antibody, molecular weight, binding characteristics, or function.  As a result, it may be more difficult to identify relevant prior art and to compare disclosures using different terminology.

Continuations Have Legitimate Uses, Which Will Be Curtailed under the New Rules

The commentary published with the new rules reveals a mindset at the PTO that patent applicants use continuations for a host of nefarious purposes that work hardship on the PTO and the public.  Two recognized cases of continuation abuse, Symbol Technologies v. Lemelson, 277 F.3d 1361 (Fed. Cir. 2002); In re Bogese, 303 F.3d 1362 (Fed. Cir. 2002), did not occur in biotech applications, however.  To the contrary, the large number of biotech continuations stems mostly from legitimate purposes, many of which will be unjustly limited by the new rules.

Providing Post-Filing Evidence of Enablement and Utility

A patent application must satisfy the statutory enablement and utility requirements at the time of filing, but additional evidence supporting enablement and utility can be submitted after the application is filed.  Although such new evidence "does not render an insufficient disclosure enabling, . . . [it] goes to prove that the disclosure was in fact enabling when filed."  In re Brana, 51 F.3d 1560, 1567 (Fed. Cir. 1995).  The time and expense of obtaining additional experimental data may be extensive, especially in technologies involving human treatment, where supporting animal model or even human data may be required.  Continuation practice addresses this problem by permitting applicants filing an original application to pursue product claims (which usually require less supporting evidence), and subsequent continuation applications to pursue therapeutic method claims.  Similarly, an applicant may pursue claims to the first embodiment of its invention to undergo experimental testing, and then file a continuation application to pursue other aspects, once relevant supporting data is obtained.

Without a liberal continuation practice, applicants may not be able to obtain the evidence necessary to prove enablement of all supported claims.  Thus, the applicant's rights to a patent that satisfied the statutory requirements may be denied if the applicant cannot satisfy the PTO's evidentiary standards within the restricted time period permitted by the new rules.  See, e.g., The Comments of the Biotechnology Industry Organization on the United States Patent & Trademark Office Proposed Rules Changes Concerning Continuation Practice and Claim Limitations, May 2, 2006, Biotechnology Industry Association, at pages 4-5 (last accessed May 4, 2006).

The PTO's commentary to the new rules explains that the PTO may permit applicants in "unpredictable arts" to file additional continuations to submit new evidence of enablement as long as the "evidence or data resulted from research or testing that was commenced with reasonable diligence," and as long as the applicant had taken "reasonable steps to resolve the issue during [prior applications]."  72 Fed. Reg. 46,775-76 (August 21, 2007).  An applicant's understanding of "reasonable diligence" may differ from the PTO's, however.  For example, the PTO suggests that reasonable diligence during prosecution of prior applications includes filing an appeal or requesting deferral of examination.  Reasonable diligence towards obtaining evidence requires that the applicant not wait for a "decision" from the PTO before commencing research, testing, or FDA submission.  72 Fed. Reg. 46,776.

The PTO advises that the mere fact that an applicant is in the process of obtaining data to support an FDA filing is not likely to justify an additional continuation application.  Moreover, the PTO predicts that the need to submit information developed for the FDA in order to prove enablement or utility will be rare, as the standard for patentability is lower than that for regulatory approval.  72 Fed. Reg. 46,775.  Nevertheless, applicants often find that data included in an FDA submission is useful to support enablement.

Strict enforcement of the new continuation restrictions may be particularly felt by small biotech companies, who will be squeezed between investors who want patent rights before funding expensive clinical trials, and the PTO, who may treat the time spent to raise capital as a "delay" demonstrating a lack of "diligence."

Negotiating With The PTO Examiner

The process of obtaining a patent involves negotiations between the PTO Examiner and the applicant as to the patentable scope of the claims and appropriate claim language.  Such negotiations are especially important in biotech applications, where many issues need to be resolved.  Often the Examiner's opening position (first Office Action) will be to reject the claims as being unclear ("indefinite"), being overly broad as compared to the disclosure (e.g., lacking enablement and/or written description), and being obvious in view of the prior art.  The applicant may address these rejections in the first instance by submitting claim amendments, explanations, and legal arguments.  Usually such a response resolves many of the issues, leaving the Examiner's remaining concerns (set forth in a "final" Office Action) for further negotiation.  At that point, the applicant may obtain and present experimental data or other evidence to support patentability.  Often, the applicant will need to file a continuation or RCE to have the new evidence entered into the record, because an Examiner is not required to consider new evidence "after final."

The PTO commentary published with the new rules suggests that this negotiation process may amount to undue delay, although many biotech representatives have adopted this approach as a reasonable way to manage patent prosecution costs.  By responding to a first Office Action primarily with good faith claim amendments and arguments, applicants are able to resolve many issues at minimal cost.  By forcing applicants to respond to each initial rejection with experimental data or other evidence, the new rules will drive up prosecution costs, and applicants may have to spend more resources than otherwise would be necessary to address improper rejections.

The elimination of liberal continuation practice transforms the patent prosecution process from a negotiation-like process to a more litigation-like proceeding, in which the Examiner is both opposing party and judge.  While the PTO suggests that increased use of appeals will mitigate the negative impact of the new rules on an applicant's ability to obtain valid patents, the PTO's analysis ignores the high costs and delay of an appeal, and the markedly increased costs of prosecution under the new rules.

Protecting Unclaimed Embodiments

Continuations often are filed to pursue patents to aspects of the invention that are described, but not claimed, in the original patent.  Business considerations may drive the filing of a continuation application, such as when a previously unclaimed product becomes commercially viable, when a competing product is discovered, when new properties of a described product are discovered, or when additional financial resources become available to support additional patent filings.  Additionally, applicants often are counseled to review their allowed patent applications for unclaimed embodiments of interest, and may realize that an important aspect of the invention is not covered by the claims, and thus should be pursued in a continuation application.

In the commentary published with the new rules, the PTO indicates that it is not likely to permit additional continuations under these conditions.  According to the PTO, "[a]pplicants should . . . know what the applicant regards as his or her invention during the prosecution of the application."  72 Fed. Reg. 46,775.  Indeed, the PTO appears to regard the use of continuations to pursue unclaimed embodiments (especially those of competitor products) to constitute abuse of the patent system.  72 Fed. Reg. 46,718-20.  Others argue that this practice places an unfair burden on those who would improve patented inventions, and undermines the incentive to improve.  Mark A. Lemley & Kimberly A. Moore, Ending Abuse of Patent Continuations, 84 B.U.L. Rev. 63 (2004).  On the other hand, proponents of liberal continuation practice insist that it is necessary to permit inventors to fully capture the benefits of their original disclosure.  Graham, supra.

Setting aside the question of whether the PTO, rather than Congress, should decide the proper balance between innovators, competitors, and incentivizing improvements, this practice has been upheld by the Federal Circuit in Kingsdown Medical Consultants v. Hollister, 863 F.2d 867 (Fed. Cir. 1988), where the court found "nothing improper, illegal or inequitable" in the practice of filing a continuation application to protect previously unclaimed embodiments.  Moreover, concerns about applicants delaying patent prosecution to obtain "late" patents are balanced by the 20-year patent term, which is measured from the filing date of the original application.  Thus, the longer an applicant waits to pursue claims to a specific aspect of the invention, the shorter the effective patent term will be for that embodiment.

Adding New Information

Continuation-in-part (CIP) practice permits an applicant to file a new application to supplement the original disclosure with new information as it is discovered, such as from on-going research.  The new rules treat a CIP as any other continuation application.  Thus, an applicant may file only two continuations, one continuation and one CIP, or two CIPs without having to justify the need for an additional CIP.  If a new invention has several different aspects, and each aspect is subject to the development of improvements warranting a CIP, an applicant may quickly be restricted by the new rules from filing all desired CIPs.  Moreover, if any application encounters a difficult prosecution requiring a continuation to obtain a patent, the ability to file a CIP will be further restricted.

The PTO's commentary to the new rules explains that "the mere fact that the subject matter was not present at the time of filing the prior filed application would not be a sufficient showing" to justify a further CIP.  72 Fed. Reg. 46,772.  In other words, the fact that an applicant made a new discovery would not justify a CIP directed to the new discovery.  Instead, the PTO advises applicants to file new patent applications to new discoveries, a practice that also will maximize patent term for the new aspects of the invention.

Biotech Beware

The biotech industry is justifiably concerned about the impact the new rules will have on the ability to obtain patents that cover all aspects of an invention.  Applicants should begin working with their patent counsel as soon as possible to devise strategies for protecting their inventions in view of the new rules.

    Ed:  Ms. Brinckerhoff is a Partner and Dr. Elliott is a law clerk with Foley & Lardner LLP.

USPTO News: e-Commerce e-Alert

    By Christopher P. Singer --

The USPTO sent out an e-commerce alert by e-mail on August 28, 2007.  The alert provided information regarding a number of topics:

(1)  Enhancements to Private PAIR (7.1):  The new version of Private PAIR is set to launch on August 31, 2007.  More information about these enhancements can be found here.

(2)  PCT RO/101 and Fee Sheet:  Filers who attach a PCT-SAFE Zip file will also need to attach the other application parts (e.g., specification, claims, abstract, drawings, etc.), as separate PDF files.  These files cannot be added to the Zip file, because EFS-Web does not extract them for processing.  The only items extracted from these Zip files are the RO/101 and Fee sheet.

(3)  Embedded Fonts:  All characters contained in a document to be submitted using EFS-Web must be embedded.  Embedding the fonts in a document ensures that a user sees documents exactly as the author/designer intended them to be seen.  All embedded fonts within a document must be licensed and legally embeddable.  When using Adobe Acrobat 6.0 (or greater) to generate documents, the USPTO.JobOptions file can be used to create Adobe PDF documents suitable for submission to the USPTO, including embedding fonts.  More information and instructions for using the USPTO.JobOptions file can be found here at the EFS-Web Tools page.  Alternatively, if you experience embedded font problems when utilizing other PDF creation tools, you can convert the text-based PDF to an image-based PDF by selecting File > Print.  Select your PDF creation tool from the Printer name drop down menu, select "Advanced," and check the box to "Print as Image."  Select "Print" and save your PDF.

(4)  Maintenance Fee Workflow:  Petition under Rule 1.378(c) Saves Time:  EFS-Web allows for applicants to submit a Petition to Accept Unintentionally Delayed Payment of a Maintenance Fee in an Expired Patent (37 C.F.R. § 1.378(c)).  This petition can be granted automatically - the patent will be reinstated immediately - if filed using the Petition under 37 C.F.R. § 1.378(c) under "Existing Application/Patent" in EFS-Web.  This option provides an obvious advantage over the other methods of filing this petition (via paper, which can take weeks to have the petition granted; or electronically via EFS-Web as a supplemental paper to an existing application/patent, which, also, can take weeks to have granted).  More information can be found at the Quick Start Guide for Petitions here.

(5)  e-Office Action Pilot Program:  The USPTO is hosting an ongoing pilot program for customers to evaluate and comment on the usability and functionality of e-Office Actions.  This program generates e-mail notifications to participants which alerts them to outgoing correspondence from the PTO regarding their patent applications.  The program will be entering Phase IV on August 31, 2007, at which time a limited number of new participants can register.  You can sign up for the program by e-mailing the PAIR team with your Customer Number(s) at [email protected].

(6)  Upcoming e-Commerce Events:  There will be an e-Commerce booth at the following times and places:

September 25-27, 2007
National Manufacturing Week (more info here)
Exhibiting with the Japan Patent Office and the European Patent Office
Booth #4633
Rosemont, IL

October 18-20, 2007
American Intellectual Property Law Association Annual Meeting (more info here).
Washington, DC

(7)  Priority Document Exchange (PDX) Tips:  Over the last few months, the USPTO has had to deny a significant percentage of the requests coming from the Japan Patent Office and the European Patent Office due to the lack of authorization from the applicant to release a copy of the unpublished U.S. application (e.g., Form SB-39).  These Offices have strict deadlines for submission of priority documents, and failure to supply the documents on a timely basis can have unfortunate consequences.  To ensure successful transmission of your priority document(s) to an Office of Second Filing, please submit such authorization as early as possible during the prosecution of your U.S. application.

USPTO News: Patent Office to Adjust Fees

    By Donald Zuhn --

Last Wednesday, the U.S. Patent and Trademark Office published a notice in the Federal Register announcing that, pursuant to 35 U.S.C. § 41(f), the Office will be adjusting patent fees to reflect fluctuations in the Consumer Price Index (CPI).  The new fees will become effective on September 30, 2007.  A listing of current fee amounts can be obtained here.

USPTO News: Patent Office Personnel to Begin Using e-Signatures

    By Donald Zuhn --

On August 20, 2007, the U.S. Patent and Trademark Office announced that patent examiners, other Office employees, and contractors under the Commissioner of Patents may begin using an S-signature (i.e., an electronic signature) to sign papers related to applications, patents, or reexamination proceedings.  The requirements for using an S-signature are set forth in 37 C.F.R. § 1.4(d)(2), which specifies that a person signing correspondence insert his or her own S-signature with a first single forward slash mark before, and a second single forward slash mark after, the S-signature (e.g., /Dr. James T. Jones, Jr./).  To comply with Rule 1.4(d)(2), the signer must also provide his or her name (i.e., without the forward slashes) and registration number (if the signer is acting in a representative capacity).  The requirements for electronic signatures for Patent Office personnel are similar to the rules set forth for practitioners in Rule 1.4(d)(2), except that Patent Office personnel will be allowed to use electronic initials or an electronic signature, and will be required to provide their official job title in place of a registration number.

An Analysis of the New Rules: 37 C.F.R. § 1.78(f): Commonly Owned Applications and Patents

    By Donald Zuhn --

Last Tuesday, the U.S. Patent and Trademark Office published new rules concerning continuation and claims practice that will undoubtedly have a profound effect on the way patent attorneys and agents prosecute applications before the Patent Office.  In view of the 128-page Federal Register notice regarding the new rules, the Patent Office's nearly two hour webcast last Thursday (and accompanying 109-page presentation), and the Office's 45-page list of Frequently Asked Questions, Patent Docs believes it may be helpful to examine the rules piece-by-piece in an attempt to identify areas where patent attorneys and agents will need to modify their patent prosecution practice.

37 C.F.R. § 1.78(f):

The prior version of 37 C.F.R. § 1.78 contained subparts (a) to (c).  Among the new subparts added to Rule 78 is subpart (f), which is itself divided into three parts.  Subpart (f)(1) requires applicants prosecuting an application to identify other commonly owned applications or patents having (a) an inventor in common with the application being prosecuted, and (b) a claimed filing or priority date within two months of the claimed filing or priority date of the application being prosecuted.

With respect to the second requirement, applicants must be cognizant of the actual filing date of both the application being prosecuted and the commonly owned applications and patents as well as the filing date of each application to which the application being prosecuted and the commonly owned applications and patents claim a benefit or priority.  The Patent Office provides an example in the Federal Register notice in which an application having an actual filing date of December 1, 2006 claims the benefit of a nonprovisional application filed on June 1, 2004 and a foreign application filed on June 1, 2003.  For purposes of Rule 78(f), the claimed filing and priority dates for this application would be December 1, 2006, June 1, 2004, and June 1, 2003.

Applicants are required to make the identification under Rule 78(f)(1) by the later of (a) four months from the filing date or the date on which national stage commenced for the application being prosecuted or (b) two months from the mailing date of the initial filing receipt in the application that must be identified.  The requirements of Rule 78(f)(1) apply to all applications pending on or after November 1, 2007, and for pending applications filed before November 1, 2007, applicants must comply with the identification requirements of Rule 78(f)(1) by the later of the above deadlines or February 1, 2008.  The identification must be made in a separate paper (a form entitled "Listing of Commonly Owned Applications and Patents" will be made available by the USPTO in October), and cannot be simply added to the specification (like the cross-reference to related applications).

Subpart (f)(2) creates a rebuttable presumption that an application being prosecuted and other commonly owned application or patent contain at least one patentably indistinct claim when the application being prosecuted and the commonly owned application or patent have (a) an inventor in common, (b) substantial overlapping disclosure, and (c) the same claimed filing or priority date.  According to Rule 78(f)(2)(i)(D), "[s]ubstantial overlapping disclosure exists if the other pending or patented nonprovisional application has written description support under the first paragraph of 35 U.S.C. 112 for at least one claim in the nonprovisional application [i.e., the application being prosecuted]."

In situations where the rebuttable presumption created under Rule 78(f)(2) arises, applicants must either rebut the presumption or file a terminal disclaimer, as described in (f)(2)(ii), by the later of (a) four months from the filing date or the date on which national stage commenced for the application being prosecuted, (b) two months from the mailing date of the initial filing receipt in the application that must be identified, or (c) the date on which a claim that is not patentably distinct from a claim in the commonly owned application or patent is presented.  As with Rule 78(f)(1), the requirements of (f)(2) apply to all applications pending on or after November 1, 2007, and for pending applications filed before November 1, 2007, applicants must comply with the requirements of Rule 78(f)(2) by the later of the above deadlines or February 1, 2008.

As with many of the Patent Office's new rules, the Office attempts to improve the effectiveness and efficiency of patent examination by shifting more burdens onto the applicant.  For example, the portion of Rule 78(f)(2) which requires applicants to submit a terminal disclaimer also requires them to explain "why there are two or more pending nonprovisional applications . . . which contain patentably indistinct claims."  In its Federal Register notice, the Patent Office squarely places the "blame" on applicants for any future double patenting rejections, stating that:

when an applicant files multiple applications that are substantially the same, the applicant is responsible for assisting the Office in resolving potential double patenting situations, rather than taking no action until faced with a double patenting rejection.  Thus, if an Office action must include a double patenting rejection (either statutory or obviousness-type double patenting), it is because the applicant has not met his or her responsibility to resolve the double patenting situation.

Under subpart (f)(3), in the absence of an applicant providing good and sufficient reason for the existence of two or more pending nonprovisional applications satisfying the requirements of Rule 78(f)(2)(i), the Patent Office may require the elimination of patentably indistinct claims from all but one of the applications.

In response to Comment 109 of the Federal Register notice, the Patent Office acknowledges that the failure to identify commonly owned applications and patents by one of the deadlines set forth in Rule 78(f)(1) could be inadvertent.  In such situations, the Office advises that an applicant "should submit the identification to the Office as soon as practical."  However, the Office reminds practitioners that it "may also refer any registered practitioner who repeatedly fails to comply with the rule requirements to the Office of Enrollment and Discipline for appropriate action," and "strongly encourage[s]" that practitioners "revise their practices to ensure timely submissions of the required identification."

To comply with the new identification requirement and rebuttable presumption created by Rule 78(f)(1) and (2), a practitioner will need to know about the existence, content, and priority claims of all commonly owned applications or patents having an inventor in common with the application the practitioner is prosecuting.  Under new Rule 78(f), practitioners who prosecute applications for larger assignees that employ the services of multiple outside counsel will have to request that the assignee provide such information.  For example, if Outside Counsel A is prosecuting Application 1 having named Inventor X and Outside Counsel B is prosecuting commonly owned Application 2 having named Inventor X, Outside Counsel A will need to know about the existence, content, and priority claims of Application 2 and Outside Counsel B will need to know about the existence, content, and priority claims of Application 1 in order for both outside counsel to comply with the requirements of Rule 78(f).

For additional information on this and other related topics, please see:

• "The 'Word' on the New Continuation Rules (from the USPTO Webcast) - Part II," August 24, 2007
• "The 'Word' on the New Continuation Rules (from the USPTO Webcast) - Part I," August 23, 2007
• "New Continuation and Claims Rules Published," August 22, 2007
• "More on M.P.E.P. § 710.06," August 20, 2007
• "Patent Office to Hold Webcast on New Claim and Continuation Rules on August 23, 2007," August 20, 2007
• "Patent Office Announces that New Continuation and Claims Rules Will Be Published . . . Tomorrow," August 20, 2007
• "Procuring Patent Protection from the Present USPTO," August 15, 2007
• "New Continuation and Claims Rules to Be Published in Late Summer," July 25, 2007
• "They Just Don't Get It - 'Patent Reform' at the USPTO," April 11, 2007
• "Patent Applicants Beware: The Rules Are Changing (Again)" Part 1 and Part 2, November 6, 2006

Text of new Rule 78(f):

(f) Applications and patents naming at least one inventor in common.

(1)(i) The applicant in a nonprovisional application that has not been allowed (§ 1.311) must identify by application number (i.e., series code and serial number) and patent number (if applicable) each other pending or patented nonprovisional application, in a separate paper, for which the following conditions are met:

(A) The nonprovisional application has a filing date that is the same as or within two months of the filing date of the other pending or patented nonprovisional application, taking into account any filing date for which a benefit is sought under title 35, United States Code;
(B) The nonprovisional application names at least one inventor in common with the other pending or patented nonprovisional application; and
(C) The nonprovisional application is owned by the same person, or subject to an obligation of assignment to the same person, as the other pending or patented nonprovisional application.

(ii) The identification of such one or more other pending or patented nonprovisional applications if required by paragraph (f)(1)(i) of this section must be submitted within the later of:

(A) Four months from the actual filing date in a nonprovisional application filed under 35 U.S.C. 111(a);
(B) Four months from the date on which the national stage commenced under 35 U.S.C. 371(b) or (f) in a nonprovisional application entering the national stage from an international application under 35 U.S.C. 371; or
(C) Two months from the mailing date of the initial filing receipt in such other nonprovisional application for which identification is required by paragraph (f)(1)(i) of this section.

(2)(i) A rebuttable presumption shall exist that a nonprovisional application contains at least one claim that is not patentably distinct from at least one of the claims in another pending or patented nonprovisional application if the following conditions are met:

(A) The nonprovisional application has a filing date that is the same as the filing date of the other pending or patented nonprovisional application, taking into account any filing date for which a benefit is sought under title 35, United States Code;
(B) The nonprovisional application names at least one inventor in common with the other pending or patented nonprovisional application;
(C) The nonprovisional application is owned by the same person, or subject to an obligation of assignment to the same person, as the other pending or patented nonprovisional application; and
(D) The nonprovisional application and the other pending or patented nonprovisional application contain substantial overlapping disclosure.  Substantial overlapping disclosure exists if the other pending or patented nonprovisional application has written description support under the first paragraph of 35 U.S.C. 112 for at least one claim in the nonprovisional application.

(ii) If the conditions specified in paragraph (f)(2)(i) of this section exist, the applicant in the nonprovisional application must, unless the nonprovisional application has been allowed (§ 1.311), take one of the following actions within the time period specified in paragraph (f)(2)(iii) of this section:

(A) Rebut this presumption by explaining how the application contains only claims that are patentably distinct from the claims in each of such other pending nonprovisional applications or patents; or
(B) Submit a terminal disclaimer in accordance with § 1.321(c). In addition, where one or more other pending nonprovisional applications have been identified, the applicant must explain why there are two or more pending nonprovisional applications naming at least one inventor in common and owned by the same person, or subject to an obligation of assignment to the same person, which contain patentably indistinct claims.

(iii) If the conditions specified in paragraph (f)(2)(i) of this section exist, the applicant in the nonprovisional application must, unless the nonprovisional application has been allowed (§ 1.311), take one of the actions specified in paragraph (f)(2)(ii) of this section within the later of:

(A) Four months from the actual filing date of a nonprovisional application filed under 35 U.S.C. 111(a);
(B) Four months from the date on which the national stage commenced under 35 U.S.C. 371(b) or (f) in a nonprovisional application entering the national stage from an international application under 35 U.S.C. 371;
(C) The date on which a claim that is not patentably distinct from at least one of the claims in the one or more other pending or patented nonprovisional applications is presented; or
(D) Two months from the mailing date of the initial filing receipt in the one or more other pending or patented nonprovisional applications.

(3) In the absence of good and sufficient reason for there being two or more pending nonprovisional applications owned by the same person, or subject to an obligation of assignment to the same person, which contain patentably indistinct claims, the Office may require elimination of the patentably indistinct claims from all but one of the applications.

Court Report

    By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases, and a few interesting cases will be selected for periodic monitoring.

Medpointe Healthcare Inc. v. Cobalt Pharmaceuticals Inc.
1:07-cv-04769; filed August 23, 2007 in the Northern District of Illinois

Medpointe Healthcare Inc. v. Cobalt Pharmaceuticals Inc.
3:07-cv-04017; filed August 22, 2007 in the District Court of New Jersey

The complaints in these cases are substantially identical.  Infringement of U.S. Patent No. 5,164,194 ("Azelastine Containing Medicaments," issued November 17, 1992) following a paragraph IV certification as part of Cobalt's filing of an ANDA to manufacture a generic version of MedPointe's Astelin® (azelastine hydrochloride nasal spray solution, used to seasonal allergic rhinitis).  View the Illinois complaint here.

Conference & CLE Calendar

September 6-7, 2007 - Emerging Issues in Biotechnology Law (American Law Institute & American Bar Association) - Washington, D.C.

September 12, 2007 - Biotechnology/Chemical/Pharmaceutical Customer Partnership Meeting (U.S. Patent and Trademark Office)

September 18-19, 2007 - Pharma/Biotech Patent Boot Camp (American Conference Institute) - San Francisco, IL***

September 24-25, 2007 - Biosimilars 2007 (Scherago International, Inc.) - George Washington University, Washington, D.C.

September 26-27, 2007 - Advanced Forum on Biotech Patents (American Conference Institute) - Boston, MA***

September 27-28, 2007 - Biotechnology: Business and Legal Developments (Law Seminars International) - Seattle, WA

October 10-12, 2007 - Stem Cells European Business Summit - Edinburgh, Scotland

October 12, 2007 - Intellectual Property Law Summit 2007 (West LEGALWorks and Intellectual Property Law Association of Chicago) - Chicago, IL

October 25-26, 2007 - Biotech and Pharma Public-Private Partnerships Forum (American Conference Institute) - Washington, D.C.***

October 25-27, 2007 - Biotechnology: Patent Prosecution, Licensing, Litigation & Hatch-Waxman (Patent Resources Group) - Palm Springs, CA

November 13-15, 2007 - Pharma and Biotech Collaborative Agreements (American Conference Institute) - New York, NY***

***Patent Docs is a media sponsor of this conference or CLE.

Proposed Agenda for Next BCP Art Group Meeting

The biotechnology, chemical, and pharmaceuticals technology groups at the U.S. Patent Office will hold their quarterly customer partnership meeting on September 12, 2007.  While the stated purpose of the meeting was merely to encourage dialog between practitioners, patent applicants, and the Office - and not to announce USPTO policy - the discussions may provide a helpful insight as to how these Art Units approach certain issues.

The proposed topics for discussion include:

• Morning Session (9:00 am EDT)
  • Final Rule on Claims and Continuations -- presenters: Bruce Kisliuk and OPLA Staff
  • Patent Reform -- presenters: George Elliott and Irem Yucel

• Afternoon Session
  • Proposed Rule Changes relating to Search and Examination of Alternative (Markush) Claims -- presenter: John LeGuyader
  • Restriction Practice for Nucleic Acid Molecules -- presenter: Julie Burke

Additional topics may be discussed as time permits.  The presentation can be attended in person at Madison East GIPA (Global Intellectual Property Academy) large lecture room on the second floor (600 Dulany Street, Alexandria, VA).  In order to attend the meeting in person, you must confirm your attendance by September 6, 2007 with Cecilia Tsang by phone (571-272-0562), fax (571-273-0562), or email ([email protected]).  The meeting can also be viewed over the internet using this link.

Federal Circuit to Change URL

    By Sherri Oslick --

Set your bookmarks; the CAFC will be changing its web site address to conform to the naming convention used by the other U.S. appellate courts.  Effective October 1, 2007, the CAFC web site will be available at www.cafc.uscourts.gov.  In order to assist with the transition, the old web site address (www.fedcir.gov) will remain active through the end of this year.

In addition to publishing newly issued opinions and opinions from the last few years, the CAFC website provides a number of valuable resources, including The Federal Circuit Rules of Practice, helpful "Top Ten" lists and guides for practicing in front of the CAFC; audio recordings of oral arguments; CAFC case statistics; and a set of FAQs.

Stem Cells European Business Summit

The inaugural Stem Cells European Business Summit will be held on October 11-12, 2007 in Edinburgh, Scotland.  A business tutorial entitled: "Stem Cells: Latest Market Analysis and
Intellectual Property Landscape" will be offered on October 10, 2007.  The summit will focus on the following topics:

• Review of Bioethics Related to Stem Cells;
• Sources of Funding for Stem Cell Research;
• The Regulatory and IP Situation;
• Commercialization of Stem Cell Research;
• Case Study Experiences from Start-Up Companies.

In addition, panel discussions will address the following topics:

• Lessons from Monoclonal Antibodies and GM Crops - Fast Track to Market and Public Acceptance;
• Challenges to Market Entry - IP, Legal, and Manufacturing.

A complete brochure for this conference, including an agenda, list of speakers, and registration form can be downloaded here.

The registration fee is £399 for the tutorial alone, £799 for the business summit, and £1079 for both the tutorial and the business summit.  Discounts are available for academics, early registration, and groups.  Those interested in registering for the summit can do so here.