by Dennis Crouch
In a recent post, I discussed major proposed changes to terminal disclaimer practice that could significantly impact the landscape of patent law. Today, I want to briefly note a trend that underscores why these proposed changes are more pertinent than ever: the increasing percentage of U.S. utility patents bound by a terminal disclaimer.
The Rising Trend
USPTO data from the last two decades reveal a noticeable increase in the percentage of issued patents with a terminal disclaimer, from 9% in 2006 to more than 18% by 2024, with a major jump from the prior trend in 2023. These trends suggests a growing complexity in patent portfolios and an increasing emphasis on non-statutory double patenting at the USPTO. At the same time, the number of patents issued per year has also more than doubled. The result then is that in 2023 almost 60,000 utility patents were bound by a terminal disclaimer.
The data also indicate that this trend spans a diverse set of entities—from large tech corporations to small startups and individual inventors. This diversity suggests that the implications of both the rising trend of terminal disclaimers and the proposed regulatory changes are widespread, affecting a broad swath of the innovation ecosystem.
The USPTO’s regulatory proposal has now been published and can be reviewed here: https://www.federalregister.gov/documents/2024/05/10/2024-10166/terminal-disclaimer-practice-to-obviate-nonstatutory-double-patenting. The USPTO is only accepting comments via the Federal eRulemaking Portal at www.regulations.gov. To submit comments via the eRulemaking portal, you have to search for docket number PTO-P-2024-0003.
Major Proposed Changes to Terminal Disclaimer Practice (and You are Not Going to Like it)
link to foley.com
Here is a write-up on the TDs that doesn’t hide the ball about it being all about making it harder to litigate a claim.
We go along with the TD most times as long as there wasn’t some huge adjustment in the patent term due to the PTO’s delay.
But after this each TD will be like 101 and will be fought tooth and nail. The client will tell us that filing a TD is verboten or only a last resort before abandoning the application.
Courtenay does a good job.
I would have added some discussion of Tafas, but she has plenty there already.
Courtenay does a good job.
You had me scared there for a moment. However, I checked the author and was relieved.
Ah, Folly & Lardnerp, the former home of the revolting pile of proud f-as-c-is-t t-r-a-s-h known as Cleta Mitchell.
Did you want to say anything actually pertaining to the topic?
One issue that the patent office has to consider is that many of the double patenting rejections are simply wrong. As an applicant, however, it doesn’t make a lot of sense to spend resources to fight the rejection. The continuation will already expire on the same day and they have no intention of separating the ownership. Filling out the one form just makes too much sense. This new proposal will change that dynamic. It’s not clear that the patent office has taken this into consideration.
That’s it, in a nutshell. There are many things that Examiners demand that Applicants concede to in order to obtain an allowance that just aren’t worth fighting due to the cost of extra delay in obtaining allowance.
Exactly Ira. We go along with it most times as long as there wasn’t some huge adjustment in the patent term due to the PTO’s delay.
But after this each TD will be like 101 and will be fought tooth and nail. The client will tell us that filing a TD is verboten or only a last resort before abandoning the application.
Off-Topic:
Any have a good citation with regard to overcoming an Examiner’s rejection that use of the suffix “-like” renders the claim indefinite?
Way to stay on topic!
What this is about is attacking litigation. A patent without a pending continuation is worth far less and it is going to be far harder to keep continuations pending without TDs.
This will weaken litigation practice and was thought up probably by some Google attorney and then communicated to the director. She probably is obeying her soon to be supervisor’s role so she can ensure a big pay out when she leaves the USPTO.
That is literally the only reason to be doing this.
And is it true that if claim 1 is obvious in view Reference A and B, and claim 2 is obvious in view of claim 1, then claim 2 is obvious over Reference A and B.
Is that true?
I’d say no.
Keeping continuations and/or divisionals pending could even avoid litigation [if willing to license], if new claims can later be added therein supported by the spec that are broad enough to clearly cover later competive products of others, yet narrow enough to avoid subsequently uncovered prior art. [If the parent application is abandoned after the continuation is filed then double-patenting issues can be avoided,]
What’s happening is they (the Google Director of the USPTO–bet she works there after she leaves and picks up $30 million, and the Google CAFC) just bite away at the patent right in every way they can.
This latest attack on TDs is actually potentially devasting to current patent practice. It will cause significant changes and make patent prosecution much more expensive. It means we will have to fight every double patenting rejection. A patent simply can’t go into litigation without a pending continuation.
Plus, the value of a continuation that is tied to validity of any claim of a parent is greatly reduced.
Just more horror stories from the patent world.
Can anyone find out how much Lee is worth now for the devastation she caused to the value of patents?
I’d so no also, but I would also like to mention that it completely upends the long held rule that claims are evaluated on a claim by claim basis for invalidity.
I will say this is going to greatly increase the complexity of continuation practice. Examiners aren’t going to be happy with this. Now, it is seldom worth it fighting a statutory double patenting rejection. With these rules probably every statutory double patenting rejection will be fought tooth and nail.
+1,000
The tone of this post is ridiculous. The rising percentage of issued patents having TDs is not a problem. What has happened is more people are filing continuations because of IPRs and other litigation where claims are so easily invalidated. In fact, the general rule of thumb is that a patent with a pending litigation is worth about at least twice the value of a patent without a pending continuation for litigation purposes.
And the number of patent application from US inventors is decreasing because of the hostile patent environment set up by the USPTO and Federal Circuit.
The simplest answer is that the USPTO wants to bring in more fee money. Many of the proposed changes by the USPTO involve the USPTO obtaining higher fees.
The question to be asked:
Who benefits from these proposed changes?
(Hint: it is not the innovators)
The increase in Terminal Disclaimers (TD) results from the increased sophistication of patent applicants.
30 years ago, you filed a patent application, got broad claims issued, received your patent, and then you moved on.
In today’s environment, with the Federal Circuit invalidating patents for a myriad of reasons, it is valuable to keep an application pending. You can fix a claim construction issue. You can tweak the claims to better read on a competitor’s product. You can beef up the claims to address a 101 rejection. Consequently, clients have learned that if they intend to litigate a patent portfolio, it is imperative to keep continuations pending.
Clients have also gotten more sophisticated about getting additional patents out of the same patent application. For big clients, where the the absolute number of patents can be more important than the strength of any one patent (in the context of cross-licensing or straight up licensing), then getting additional patents with the same patent application can be more cost-effective.
Something I have seen quite often is that an Examiner will offer to allow something that is narrower than what the client believes they are entitled to. In that situation, the client will take the allowable claims and allow that application to issue and then file a continuation application to go after broader claims.
Oftentimes, the obviousness-type double patenting (OTDP) rejections I’ve encountered are the WORST rejections I have ever seen. A ODTP rejection is a rejection for obviousness — yet many examiners won’t even make the barest of analysis explaining why the new claims are obvious in few of the old claims. Today, many clients will file a TD just to overcome a OTDP rejection — even if the OTDP rejection is not warranted. There is little downside as the patents will almost always be commonly owned. However, if the USPTO’s new proposal is put into effect, expect a LOT more fighting over OTDP rejections.
With the 20 year from filing limit on patent term and the trivially-easy ability to search the ownership of a patent family online (something that couldn’t have been said 30 years), I don’t see the continuing policy justification for making OTDP rejections.
Back when I was an engineer and we were being taught about process improvement, one of the lessons we were given was about how many processes are infected by tasks that had relevance decades ago but changes have made those tasks irrelevant. However, those tasks remain because of the attitude “that is how we always did things.” Consequently, to perform process improvement, we had to identify those unnecessary tasks and remove them. OTDP rejections are just another one of those things that had some usefulness some time ago — a usefulness that is mostly unnecessary today.
Overall, those are good comments.
I think too that further reflection reveals that the point of restricting TDs is to hurt litigation.
You make a valid point there – and take that one step further: who benefits from that?
Totally agree. It’s a pre-GATT judge-made relic that should go by the wayside. Unfortunately, it appears that there are lobbying interests that are trying to use backdoor means to kneecap continuation practice.
Yep.
The question to ask: who benefits?
Dennis, is this recent increase in isssued patents with terminal disclamers logically correlated to an increase in the number of issued patents based on or having continuation or divisional applications?
Or, could it just be wider knowledge among patent attorneys that not filing a terminal disclaimer until after the patent is issued and is being sued on may be too late if one patent got a term extension?