An Analysis of the New Rules: 37 C.F.R. § 1.78(a)(2): Divisional Dilemma?

    By Donald Zuhn --

On August 21, 2007, 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 on August 23, 2007 (and the webcast's accompanying 113-page presentation), and the Office's 63-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(a)(2):

Recently, we discussed an aspect of the new continuation and claims rules that even had the Commissioner of Patents initially stumped (see "It Ain't Necessarily So").  In particular, Commissioner John Doll (at left), when speaking at the ACI Biotech Patents Conference last month, informed the audience that an examination during International phase did not constitute an "examin[ation] in any prior-filed application" under Rule 78(a)(2).  The next day, the Commissioner reversed course by acknowledging that he had been mistaken.  That same day, the Patent Office added two new questions (C8 and C11) that somewhat addressed the situation to its "Frequently Asked Questions" document.

Commissioner Doll's initial reply came in response to the following hypothetical:  an applicant files an International application and a U.S. nonprovisional, which presumably contain the same claim set, and which claim the benefit of the same provisional; the applicant files a Chapter II Demand in the International application; and the applicant receives a Restriction Requirement in the nonprovisional application.  Ultimately, the Commissioner stated that the applicant would not be permitted to file a "proper" divisional application off of the nonprovisional application because the claims - despite being restricted by a U.S. Examiner in the nonprovisional application - had been examined in the International application as a result of the applicant's filing of a Demand.  Thus, the claims of the divisional application would contravene the prohibition in Rule 78(a)(2) that the claims in a divisional "not [be] examined in any prior-filed application."

Depending on the particular circumstances, the Patent Office's interpretation of Rule 78(a)(2) could create some rather bizarre outcomes.  For example, if an applicant sought examination of the International application in Europe, the European Examiner and the U.S. Examiner could take entirely different positions with respect to the restriction of the same claim set, but the European Examiner's position would trump the U.S. Examiner's position.

Potentially more troubling would be a situation in which the European Examiner finds that "there is a technical relationship among [a group of inventions claimed in a single international application] involving one or more of the same or corresponding special technical features," and therefore, determines that the requirement of unity of invention has been fulfilled (see Rule 13 of Patent Cooperation Treaty), but the U.S. Examiner determines that restriction is necessary in the nonprovisional application.  [We note that one comment submitted in response to the Patently-O article "Rule Changes Triage" raises this issue.]  Is the applicant still precluded from filing a divisional application off of the nonprovisional application?  If so, would the applicant also be precluded from pursuing claims to independent and distinct inventions in the nonprovisional application because such claims would be directed to non-elected inventions, or would the applicant have to use a valuable continuation application to secure such claims?  What if the Examiner restricted the claims into more than three inventions?  What if the applicant only had "one more" continuation left in the application family?

As with many of the new rules, Rule 78(a)(2) - and the Patent Office's interpretation of this rule - raise questions for which there do not seem to be any easy answers.  So what should applicants do before November 1, 2007 to protect themselves?  [As we noted in our previous article, for International applications that have not yet been filed, or which have only recently been filed, applicants would be wise not to file a Demand.]

Assuming that the mere filing of a Demand creates the problem described above, an applicant could file a divisional application covering each independent and distinct invention before November 1, 2007.  By doing so, the potential problems created by Rule 78(a)(2) could be avoided, since this rule only applies to applications filed on or after November 1, 2007 (see 72 Fed. Reg. 46716).

However, is the mere filing of a Demand sufficient to create the problem described above?  Rule 78(a)(2) appears to specify four requirements for a "proper" divisional application:

(1) the application must "disclose[] and claim[] only an invention or inventions that were disclosed and claimed in a prior-filed application,"
(2) the invention or inventions must have been "subject to a requirement to comply with the requirement of unity of invention under PCT Rule 13 or a requirement for restriction under 35 U.S.C. 121 in the prior-filed application,"
(3) the invention or inventions "were not elected for examination," and
(4) the invention or inventions "were not examined in any prior-filed application."

Only the last requirement would seem to be related to the filing of the Demand.  With respect to the second requirement, M.P.E.P. § 1850(V) states that:

The search fee which the applicant is required to pay is intended to compensate the International Searching Authority for carrying out an international search (and for international applications having a filing date on or after January 1, 2004, for preparing a written opinion), but only where the international application meets the "requirement of unity of invention".  That means that the international application must relate to only one invention or must relate to a group of inventions which are so linked as to form a single general inventive concept (PCT Articles 3(4)(iii) and 17(3)(a)).

If the International Searching Authority finds that the international application does not comply with the requirement of unity of invention, the applicant will be informed of the lack of unity of invention by a communication preceding the issuance of the international search report (and for international applications having a filing date on or after January 1, 2004, a written opinion of the International Searching Authority), which contains an invitation to pay additional search fees.  (Form PCT/ISA/206 or USPTO/299 (telephone practice), see below).  This invitation specifies the reasons the international application is not considered to comply with the requirement of unity of invention, identifies the separate inventions, and indicates the number of additional search fees and the amount to be paid (PCT Rules 40.1, 40.2(a) and (b)).

Thus, one could argue that if an applicant did not receive an invitation to pay additional search fees, the invention claimed in a divisional application (and disclosed and claimed in a prior-filed International application) had not been "subject to a requirement to comply with the requirement of unity of invention under PCT Rule 13."  Moreover, one could also argue that in the absence of such an invitation, the applicant could not have made a decision to pay (or not pay) additional fees, and therefore, did not satisfy the third requirement of Rule 78(a)(2), i.e., not having elected the invention claimed in the divisional application.

Therefore, with respect to divisional applications filed off claim sets that have been presented in International applications in which a Demand was filed, the new rules present applicants with a choice:

(1) play it safe and file your divisional applications before November 1, 2007, or
(2) rely on an interpretation of Rule 78(a)(2) that excludes International applications in which (a) no invitation to pay additional search fees was issued, (b) additional search fees were not paid (and thus, only one invention was examined), OR (c) a Demand was not filed, and file your divisional applications after November 1, 2007.

As always, we would appreciate your comments regarding this potential new rules dilemma.

For additional articles in this series, please see:

• "An Analysis of the New Rules: 37 C.F.R. § 1.142(c): Increasing the Chances of Submitting a Successful Suggested Restriction Requirement (SRR)," October 4, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.145: "Provoking a Restriction Requirement," October 3, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.78(d)(1)(i) & (vi): PCT Practice," September 23, 2007
• "An Analysis of the New Rules: USPTO Releases ESD Guidelines," September 17, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.265: Examination Support Document," September 13, 2007
• "An Analysis of the New Rules: Revisions to First Action and Second Action Final Practice," September 11, 2007
• "An Analysis of the New Rules: 37 C.F.R. §§ 1.78(d)(1) and 1.114: Streamlined Examination," September 10, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.117: Refund Due to Cancellation of Claims," September 10, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.142: Suggested Restriction Requirements," September 6, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.114: RCE Practice," September 5, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.75(b): 5/25 Limit on Claims," September 4, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.78(d)(1): Claims for Benefit of Prior-Filed Applications," September 3, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.78(f): Commonly Owned Applications and Patents," August 27, 2007

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

• "'Impact' of New Continuation and Claims Rules," October 8, 2007
• "Is the Patent Office Starting to Blink," October 5, 2007
• "Breaking A Very Long Silence," October 1, 2007
• "It Ain't Necessarily So," September 28, 2007
• "Commissioner Doll Addresses ACI Biotech Patents Conference," September 26, 2007
• "Rules Challenger Amends Complaint and Withdraws PI Motion," September 11, 2007
• "Inventor Sues PTO to Prevent New Continuation Rules from Taking Effect," August 30, 2007
• "Patent Office Provides Recorded Web-Based Discussion of New Rules," August 30, 2007
• "New PTO Continuation Rules: Unfair to Biotech?" August 29, 2007
• "Proposed Agenda for September 12, 2007 Biotechnology/ Chemical/Pharmaceutical Art Group Meeting," August 24, 2007
• "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

Changes to Rule 78(a)(2):

(a) Definitions --

(1) Continuing application. A continuing application is a nonprovisional application or an international application designating the United States of America that claims the benefit under 35 U.S.C. 120, 121, or 365(c) of a prior-filed nonprovisional application or international application designating the United States of America. An application that does not claim the benefit under 35 U.S.C. 120, 121, or 365(c) of a prior-filed application is not a continuing application even if the application claims the benefit under 35 U.S.C. 119(e) of a provisional application, claims priority under 35 U.S.C. 119(a)- (d) or 365(b) to a foreign application, or claims priority under 35 U.S.C. 365(a) or (b) to an international application designating at least one country other than the United States of America.

(2) Divisional application. A divisional application is a continuing application as defined in paragraph (a)(1) of this section that discloses and claims only an invention or inventions that were disclosed and claimed in a prior-filed application, but were subject to a requirement to comply with the requirement of unity of invention under PCT Rule 13 or a requirement for restriction under 35 U.S.C. 121 in the prior-filed application, and were not elected for examination and were not examined in any prior-filed application.

(3) Continuation application. A continuation application is a continuing application as defined in paragraph (a)(1) of this section that discloses and claims only an invention or inventions that were disclosed in the prior-filed application.

(4) Continuation-in-part application. A continuation-in-part application is a continuing application as defined in paragraph (a)(1) of this section that discloses subject matter that was not disclosed in the prior-filed application.

Comments

[Steven Colby]

I have an unexamined (hypothetical) U.S. application in which a ladder, a new paint and a new paint applicator are disclosed. The current Claims are directed toward the paint. I plan to add an independent claims this month directed toward the applicator and the ladder. I expect a restriction requirement. My problem is that the disclosure regarding the applicator is just sufficient to cover parts of the applicator. Under the old rules I would be filing a CIP to more fully describe the applicator. Because there is no Divisional-in-Part, under the new rules it appears that to add new matter I will have to use up a CIP if the application is subject to a restriction requirement.

[anonymous]

Donald:

I previously posted a question regarding the scope of "and were not examined in any prior-filed application." See
http://www.patentdocs.us/patent_docs/2007/09/it-aint-necessa.html#comment-85963708

Perhaps you can opine, if Kevin is unavailable. It seems to me that "any prior-filed application" would refer to any application (whether US non-provisional, PCT, or foreign) that was filed before the divisional was. It also seems to me that "any" would not require that the non-provisional, PCT, or foreign application to be related in any way to the application in which the restriction was issued.

It makes sense to avoid saying that non-examination in the restriction case is sufficient. After all, the USPTO doesn't want the applicant to get a restriction in one case, prosecute the non-elected invention in a straight continuation, and then later get the benefit of a division plus two more continuations for the non-elected invention. But by casting the net broadly to "any prior-filed application," it would appear any examination, in any application, in any office in the world defeats your division. Any thoughts?