The ‘Cooperative Research and Technology Enhancement Act (CREATE Act) of 2004′ easily passed both the House and Senate and has been signed into law by President Bush today, December 10, 2004. (see Thomas). The purpose of the Act is to promote cooporative research — such as between a university and start-up company. The main thrust of the new law is to exclude some prior art from obviousness (103) consideration if the invention arose from a joint research agreement.
What You Need to Know:
If you are involved in cooperative research, you need to have a joint research agreement to ensure that your work will not invalidate patents that you apply for sometime in the future. If you already have a joint agreement, you may need to make amendments to the agreement to ensure that it qualifies under the new law.
In order to qualify under the law, currently pending applications should be amended to disclose the names of the parties to the joint areement. You may also consider a broadening reissue if your claims were restricted by now excluded prior art.
Text of the Act:
Section 103(c) of title 35, United States Code, is amended to read as follows:
(c)(1) Subject matter developed by another person, which qualifies as prior art only under one or more of subsections (e), (f), and (g) of section 102 of this title, shall not preclude patentability under this section where the subject matter and the claimed invention were, at the time the claimed invention was made, owned by the same person or subject to an obligation of assignment to the same person.
(2) For purposes of this subsection, subject matter developed by another person and a claimed invention shall be deemed to have been owned by the same person or subject to an obligation of assignment to the same person if–
(A) the claimed invention was made by or on behalf of parties to a joint research agreement that was in effect on or before the date the claimed invention was made;
(B) the claimed invention was made as a result of activities undertaken within the scope of the joint research agreement; and
(C) the application for patent for the claimed invention discloses or is amended to disclose the names of the parties to the joint research agreement.
(3) For purposes of paragraph (2), the term `joint research agreement’ means a written contract, grant, or cooperative agreement entered into by two or more persons or entities for the performance of experimental, developmental, or research work in the field of the claimed invention.
(a) IN GENERAL- The amendments made by this Act shall apply to any patent granted on or after the date of the enactment of this Act. (Exception: The legislation does not not affect the right of any party in any action pending before the United States Patent and Trademark Office or a court on the date of the enactment of this Act to have that party’s rights determined on the basis of the provisions of title 35, United States Code, in effect on the day before the date of the enactment of this Act.
MESSAGE TO RESEARCHERS:
If you work collaborate on work with individuals from other legal entities, you need to have an agreement up front as to how that collaboration is going to be handled. Contact your patent attorney to ensure that the agreement is properly created to fall within the scope of the new law.
BACKGROUND ON THE LAW:
Texas Republican Lamar Smith introduced the legislation in 2003 to promote research between universities and the private sector.
According to co-sponsor Senator Leahy, this Bill will circumvent the ruling in OddzOn Products, Inc. v. Just Toys, Inc. (Fed. Cir. 1997) (holding that non-public information may be used as prior art under certain circumstances), thus allowing more collaboration. Philip McGarrigle published an article in IDEA discussing the OddzOn Products. Brian Murphy disagreed with OddzOn Products in the Fordham IP Law Journal. Additionally, James Gambrell discusses the use of section 102(f)/103 prior art in the Federal Circuit Bar Journal.
Analysis and discussion of the Act from the House Committee Report:
In particular, Sec. 103(c) is amended to add a new paragraph that permits reliance on the provisions of 103(c) by parties that have not commonly assigned their rights to subject matter and the invention at the time a claimed invention was made. It does so by construing the phrase `owned by the same person or subject to an obligation of assignment’ in newly redesignated 103(c)(1), to include circumstances in which the parties have entered into a qualifying joint research agreement before to making the invention. The amendments made in this Act do not alter existing law governing inventions under 103(c) where the invention and the subject matter at issue are commonly owned or subject to an obligation of common assignment.
A party who seeks to gain the benefit of the amended Sec. 103(c) must comply with certain conditions. First, the invention and the subject matter (i.e., prior art or information qualifying solely under 35 U.S.C. 102(f)) that is being excluded must be owned by, or otherwise subject to the control of, one or more of the parties to the joint research agreement. While the subject matter being excluded may pre-date the joint research agreement, the claimed invention must be made after the date of such agreement. Second, the invention must arise from work performed by or on behalf of the natural or legal persons that are party to the eligible joint research agreement. Third, the identities of the parties to the joint research agreement must be disclosed in the patent. This information may be included in the original application, through an amendment to the application, or added by an amendment to the patent (e.g., by a certificate of correction) pursuant to the amended law. The omission of the names of parties to the agreement is not an error that would justify commencement of a reissue or reexamination proceeding.
Thus, by entering into a joint research agreement before making the claimed invention, disclosing the names of the parties in the patent application or amendment, and ensuring that the claimed invention resulted from activities under the agreement, subject matter developed by another person and the claimed invention will be deemed to be commonly owned.
Section 2 also defines the term `joint research agreement’ as a `written contract, grant, or cooperative agreement.’ By doing so, Congress does not intend to prescribe the specific form of the agreement parties must use to benefit from this Act nor to require the writing be contained in a single instrument. Congress does intend the writing to demonstrate that a qualifying collaboration existed prior to the time the claimed invention was made and that the claimed invention was derived from activities performed by or on behalf of parties that acted within the scope of the agreement.
The term `joint research agreement,’ used in section 2 of the Act, is not limited to joint research agreements under the Bayh-Dole Act (Sec. 200 et seq. of the Patent Code), but also includes other governmental or private sector cooperative research agreements, development agreements, and other transaction agreements, including Government Cooperative Research and Development Agreements (15 U.S.C. 3701a), and Department of Defense or National Aeronautics and Space Administration (NASA) `other transaction’ agreements (10 U.S.C. 2371, 42 U.S.C. 2473).