Guest Post by Ted Sichelman, University of San Diego School of Law
As any avid reader of Patently-O knows, the pending patent reform bills all contain a shift from a primarily "first to invent" to a primarily "first to file" approach. Previous posts have described many of the differences between the present and proposed approaches (see, e.g., here and here). In this post, I focus on the treatment in the bills of an inventor's sale and use of a claimed invention in the one-year period just prior to filing. I argue that the bills' language does not effectuate Congress's intent to keep the inventor grace period intact, and I propose suitable language to do so at the end of the post.
Under the Patent Act now in effect, an inventor's disclosure of a claimed invention in a previously filed patent or application, or an inventor's use, sale, or offer for sale of the invention can only count as prior art or a bar to patenting (if at all) if those events occurred more than one year before the effective filing date of the application claiming the invention. This one year limitation on prior art is commonly referred to as the "grace period."
Apparently, the Senate meant to carry over the grace period for an inventor's disclosure, use, or sale of a claimed invention—as well as exclude potential prior art derived from the inventor—in the bill it recently passed. As Senator Patrick Leahy exclaimed in a colloquy with Senator Orrin Hatch, if the inventor's invention is "described in a printed publication, or in public use, on sale, or otherwise [made] available to the public" by the inventor (or one who derives from the inventor) less than one year before filing, then "there is absolutely no situation in which" this activity would bar patentability.
Unfortunately—as Dennis Crouch, Hal Wegner, and others have recognized—the plain language of the relevant provisions in the recently passed Senate bill, as well as the pending House bill, does not appear as broad as Senator Leahy believes. In particular, the relevant provisions only exclude from prior art "disclosures" by inventors (and derivers) made less than one year before filing ("A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention …") (emphasis added).
A plain language interpretation of "disclosure" would refer to printed material, such as patents and publications—as well as oral disclosures, such as at a trade show—but not necessarily uses, sales, or offers for sale of the invention. Moreover, an actual "disclosure" of the invention would presumably require that the disclosed material be "enabling" in the prior art sense—namely, that description, use, sale, etc., disclose to one of the ordinary skill in the art how to make (or perform the steps of) the invention (see, e.g., Perricone v. Medicis Pharm. Corp. (Fed. Cir. 2005) (holding that a "disclosure is prior art to the extent of its enabling disclosure"); In re Donohue (Fed. Cir. 1985) ("[E]ven if the claimed invention is disclosed in a printed publication, that disclosure will not suffice as prior art if it is not enabling.")).
Yet, the Federal Circuit has routinely held that "non-informing" uses or sales of the claimed invention made more than one year before filing—namely, ones which would not inform one of ordinary skill how to make the invention—may count as prior art under the current statute (see, e.g., See In re Epstein (Fed. Cir. 1994) ("Beyond this 'in public use or on sale' finding, there is no requirement for an enablement-type inquiry.").). Moreover, the Federal Circuit has held that secret use of a claimed method by an inventor to make a product that is sold to the public may count as prior art (see Gore v. Garlock (Fed. Cir. 1983)). Thus, a plain language reading of "disclosure" arguably would not—contrary to Senator Leahy's intention—exclude from prior art non-informing or secret uses and sales made within the grace period.
Senator Hatch asserts there is no problem with the "disclosure" language because "[i]f a disclosure resulting from the inventor's actions is not one that is enabled … then such a disclosure would not constitute patent-defeating prior art … in the first place." Yet, nothing in the Senate bill points towards such a reading. Specifically, the provision in the bill enumerating what counts as prior art states:
Sec. 102. Conditions for patentability; novelty
(a) Novelty; Prior Art-
A person shall be entitled to a patent unless–
(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention ….
Granted, this provision appears to require that sale and use prior art be made "available to the public." Yet, under Federal Circuit doctrine, sale and use art need not be enabling in order to be available to the public. In particular—as I just mentioned—"non-informing" and "secret" uses and sales may count as prior art. Thus, a plain language reading of the pending bills would arguably include as prior art sales and uses that are clearly not "disclosures" in the ordinary sense of the term.
And because courts of late—particularly the Supreme Court (see, e.g., Bilski)—have used plain language interpretations of the Patent Act, it is not prudent drafting to hope courts will look to the legislative history to fix the situation. Moreover, as Hal Wegner has noted, the Leahy-Hatch statements actually post-date the passage of the Senate bill, potentially negating their value as probative legislative history—especially in view of some seemingly contrary statements in the pre-passage legislative history (see, e.g., 157 Cong. Rec. 1348, 1355-56 (Mar. 9, 2011) ("An inventor who publishes his invention retains an absolute right to priority if he files an application within one year of his disclosure.") (emphasis added)).
The policy problem with treating (at least many) sales and uses made during the one-year grace period as prior art is that it forces inventors to forgo a wide range of commercial activity prior to filing for a patent. This would impose a particularly heavy burden on independent inventors, as well as startup and early-stage companies, who simply cannot afford to file patent applications on every invention before getting a sense of the invention's commercial viability. (See here and here for data on startup patenting costs.)
In order to remedy the problem, the bills' proposed provision can be easily revised. Just this morning, a Manager's amendment (Download Managers_Amendment_to_HR1249) was introduced in the House that would remove "in public use, on sale, or otherwise available to the public" from the prior art provision of Section 102(a)(1) and replace it with "otherwise disclosed to the public." This change would presumably mandate that only sales and uses, whether made by the inventor or a third party, that are enabling would ever count as prior art—and not just for grace period purposes. This legislative change would effectively overrule many years of well-established judicial precedent that non-informing uses and sales by inventors and third parties, as well as a secret use of a claimed method by an inventor to manufacture products then sold to the public, count as bars to patenting.
Such a shift would be unwise, because it would allow inventors to commercially benefit from their inventions (without disclosing them) for an indefinite period of time before filing for a patent. As Judge Learned Hand explained in Metallizing Engineering (2d Cir. 1946) (emphasis added), "It is indeed true that an inventor may continue for more than a year to practice his invention for his private purposes of his own enjoyment and later patent it. But that is, properly considered, not an exception to the doctrine, for he is not then making use of his secret to gain a competitive advantage over others; he does not thereby extend the period of his monopoly."
Instead, the provisions enumerating prior art should be left intact, and the exclusionary clause revised to make it absolutely clear that all inventor sales, uses, or other activities that make the invention available to the public less than one year before filing would be excluded as prior art (added material underlined):
SEC. 2. FIRST INVENTOR TO FILE.
* * *
`(b) Exceptions-
`(1) DISCLOSURES, USES, OR SALES MADE 1 YEAR OR LESS BEFORE THE EFFECTIVE FILING DATE OF THE CLAIMED INVENTION- A disclosure, use, offer for sale, or sale made 1 year or less before the effective filing date of a claimed invention, or making the claimed invention available to the public 1 year or less before the effective filing date of the claimed invention, shall not be prior art to the claimed invention under subsection (a)(1) if–
`(A) the disclosure, use, offer for sale, or sale of the claimed invention, or the making of the claimed invention available to the public, was made by the inventor or joint inventor or by another who obtained the subject matter disclosed, used, offered for sale, sold, or made available to the public, directly or indirectly from the inventor or a joint inventor; or
`(B) the subject matter disclosed, used, offered for sale, sold, or made available to the public had, before such disclosure, use, offer for sale, or sale of the claimed invention, or the making available to the public of the claimed invention, been publicly disclosed by the inventor or a joint inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor.
Ted Sichelman is an Assistant Professor at the University of San Diego School of Law, where he teaches patent law and other intellectual property courses. Charles Coover provided helpful research assistance for this post.