Transcript Presentation to American Chemical Society What a chemist

What a chemist needs to know
about patent law
Committee On Patents and Related Matters
Galina Yakovleva
Valerie L. McDevitt
Marc A. McKithen
Constitutional Authority
“The Congress shall have Power.....To promote the
Progress of Science and useful Arts, by securing
for limited Times to Authors and Inventors the
exclusive Right to their respective Writings and
Discoveries” . . . (Article 1, section 8, clause 8)
1
Right to Exclude
A United States patent provides its owner with the
legal right to prevent unauthorized making, using,
selling, offering for sale in the U. S. and the
importation into the U.S., of the invention set forth
and claimed in the patent
2
Not a Right to Practice
But this right to exclude does not grant the right to
practice the invention (e.g., government regulation
may interfere)
3
Reasons for Acquiring Patents
• Protect market
– Prevent competitor from copying
– Maintain product differentiation
– Erect barriers for entry into a market
– Develop reputation as innovator/prestige
• Revenue through licensing/assignment
• Helps with credibility/advertising
4
Patentable Inventions
“Whoever invents or discovers any new and useful
process, machine, manufacture, or composition
of matter, or any new and useful improvement
therefore, may obtain a patent therefore.” 35
U.S.C. 101
Utility and plants patents – 20 year term from
earliest claimed U.S. filing date
Design patents – 14 years from grant date
5
Patentable Subject Matter
• Composition of matter – includes chemical
compounds or processes, altered or isolated
genetic material, mechanical or physical mixtures,
alloys and compositions, and unions of several
ingredients
• Plants – Limited to plants that are asexually
reproduced other than a tuber propagated plant or
a plant found in an uncultivated state
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Non-patentable Subject Matter
• Laws of Nature and Scientific Principles
– Discovery of new principle, force or law of
operating on matter are not patentable, but
their application usually is patentable
• Abstract Ideas or Theories
7
Patents - Capturing Inventions
• The “first-to-invent” system in U.S.
– The first to conceive and reduce to practice an
invention is entitled the patent rights
– The first to conceive and diligently pursue his
or her invention is entitled to patent rights
even if the last to reduce to practice
8
Requirements for Patentability
• Novelty
• Non-obviousness
• Usefulness
Requirements that should be satisfied before
application is filed
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Novelty
• Applicant for patent must believe he or she is first
person to discover the invention
• The invention must not have been published
anywhere and must not have been in public use
or on sale in the U.S. more than one year before
the filing of the application
• Inventor actions can bar a patent on his or her
own invention
– “Absolute novelty” required in most countries
– One (1) “Grace Year” in U.S.
10
Non-Obviousness
• Must not have been obvious
– “Prior art” discloses an invention that is so
similar to the alleged invention that it would
have been obvious to one of ordinary skill in
the art based on the knowledge of the prior art
– The court determines obviousness by
examining the differences between the prior
art and the claimed invention in view of what
would be readily understood by one of
ordinary skill in the art
A
B
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Non-Obviousness
• Objective evidence of non-obviousness
– Commercial success attributable to the
invention
– Long felt but unsatisfied need for the invention
– Copying by competitors
– Acclaim by the industry, etc.
12
Non-Obviousness
• Generally non-obviousness is established by
showing
– the advantages of the invention
– a lack of motivation for modifying prior art to
result in the invention
– the prior art actually suggests not making the
modification (“teaching away”)
13
Usefulness
• Generally it is easy to meet this criteria
• Now mostly used to deny patents for
perpetual motion machines and other things
that seem to violate the laws of nature or
otherwise lack credibility
• Also used to deny patents where real world
utility of a DNA sequence is not clear
14
Pre-Filing Procedure
• Document the invention
• Collect relevant prior art – duty of disclosure owed
by applicant
• Evaluate economic significance of the invention
• Do not publish invention anywhere or use or offer
to sell it in U.S.
15
Patent Prosecution
• “Prosecution” is the term given to the back-andforth between the Patent Office (“PTO”) and the
Applicant [or his attorney/agent]
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Types of Applications
• Provisional – A place holder
– No claims required
– Not examined
– Duration is 12 months, maximum
– Needs only a Specification, and drawings (if
needed)
• Regular application - Requires Specification,
drawings (if needed), and claims
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Application – Order of Sections
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Title
Cross-Reference to Related Application(s)
Background of the Invention
Brief Summary of the Invention
Brief Description of the Drawings
Detailed Description of the Invention
Claim(s)
Abstract
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Procedure for Obtaining Patents
• Prepare a patent application
– Disclose enough to enable one skilled in the
art to make and use the invention
– Disclose “best mode” of carrying out the
invention (that is, if the inventor has the
subjective belief there is a best way to carry
out the invention)
– If possible, disclose more than required
– Formalities
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Procedure for Obtaining Patents
• Prepare a patent application
– Disclose all alternative embodiments
• Interferes with others’ attempts to obtain
“improvement patents” or designing around
the patent
• Broadens possible scope of protection and
provides retreat positions for claiming
invention
– Applications lacking in detail sometimes get
broader interpretations, but are easier to
invalidate
20
Procedure for Obtaining Patents
• Prepare claims for a patent application
• Define the scope of the invention
– Must be clear
– Must not read on the prior art
– Must define a novel, non-obvious and
useful invention
• Provides notice to the public
21
Procedure for Obtaining Patents
• Patentability searches
– Searches made to determine whether there is
enough protection available to go forward
– Identifies the prior art
– Identifies extent protection available over
prior art
– Also helps with drafting process
• Draft claims to reflect existing prior art
• Identifies customary level of disclosure for
a particular art
22
Procedure for Obtaining Patents
• Responses to an Examiner’s actions can occur
through: interviews, written arguments,
amendments to the text of the application
including claims, and affidavits or other
documentary evidence supporting patentability
• Generally present arguments twice for each office
action fee
23
Procedure for Obtaining Patents
• If USPTO denies application patent, a patent
applicant may appeal to the USPTO Board of
three Administrative Patent Judges, then onto
either District Court to present more evidence or
directly to the Court of Appeals for the Federal
Circuit
• Allowance of claims and issuance upon payment
of issue fee and now an application publication
fee
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18 Month Publication of U.S. applications
• Provide for provisional rights
– No injunctions, but can get monetary award
(reasonable royalty) if issued claims are
substantially identical to the claims in the
published application
– Must provide actual notice to infringer
– Voluntary publication possible but generally
application published as filed
• May cause competitor’s apprehension
• Can block others from getting similar rights
25
Granted Patents
• Patent can be licensed for money or in exchange
for another’s IP rights
– “fight patents with patents”
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Technology Transfer
Of A Patented Invention
27
The Value of An Invention
is in the Using of It
Modified from Thomas Alva Edison
28
Criteria and Considerations For
Technology Transfer
Commercial potential
• Ability to define product
• Ability to identify customer/end user
• Perceived industry value/need
• Market size
• Prospective licensee(s) identified
• Prospective licensee(s) expressed interest
• Competing technologies
• Predisposition of industry to licensing
• Regulatory and liability commercialization hurdles
• Development status-time to milestones
• Established industry channels to commercialize
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Why not pursue
• Commercial market too small.
• Patent breadth limited due to earlier public
disclosures.
• Patent would be difficult or impossible to police.
• No commercial advantages or economic cost-savings
apparent to encourage companies to take a license.
• Research funding complications.
• Sponsorship agreement may give rights to
funding organization.
• Often, intellectual property complications can be
negotiated out of research agreements.
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The Technology Transfer Decision
• Decision:
– Does reflect the likelihood that the technology
will be able to generate commercial royalties
greater than patent costs.
– Does not reflect a judgment of the quality of
the science nor the scientific importance of
the discovery.
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Targeted & Strategic Marketing
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E-mail
Snail mail
Newsletter
Web site
Symposia
Venture forums
Road trips to Corporations
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Marketing Technology
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Non-confidential summary
Confidential summary
Letter of intent
An option
License
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Major Steps in Tech Transfer
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Disclosure of Inventions
Record Keeping and Management
Evaluation and Marketing
Patent Prosecution
Negotiation and drafting of license
agreements
• Management of active licenses
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Factors governing license fees and royalties
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Type of technology
Stage of development
Size of potential market
Profit margin for product
Amount of perceived risk
Strength of patents
Costs of bringing product to market
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Elements of the Agreement
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R&D sponsorship
Initiation Fee
Maintenance fees
Milestone payments
Royalties
Equity vs. Cash
Endowed Fellowships and Chairs
Incentives and Penalties
Sponsorship of Awards , Symposi
36
Patent Infringement Litigation
A form of civil litigation where a patent-holder
(patentee) sues a defendant for infringing a patent.
37
Infringement
What is infringement?
• Direct infringement - 35 U.S.C. 271(a)
• Infringement by Inducement - 35 U.S.C.
271(b)
• Contributory infringement - 35 U.S.C. 271(c)
Test for infringement
• A product infringes if it falls within the scope of
the patent claims, not if it copies the patent
holder’s product
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Direct Infringement
“Whoever without authority makes, uses, offers to
sell, or sells any patented invention, within the
United States or imports into the United States any
patented invention during the term of the patent
therefor, infringes the patent.” (35 U.S.C. 271(a))
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Infringement by Inducement
“Whoever actively induces infringement of a patent
shall be liable as an infringer.” (35 U.S.C. 271(b))
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Contributory Infringement
“Whoever offers to sell or sells with the United
States or imports into the United States a
component of a patented machine, manufacture,
combination or composition, or a material or
apparatus for use in practicing a patented process,
constituting a material part of the invention,
knowing the same to be especially made or
especially adapted for use in an infringement of
such patent, and not a staple article or commodity
of commerce suitable for substantial non-infringing
use, shall be liable as a contributory infringer.”
(35 U.S.C 271(c))
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Challenges To Patent
• Validity
• Enforceability
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Validity
A patent is valid only if the following requirements
for patentability are satisfied, including:
• Useful
•
Novel – i.e., it is not anticipated
•
Nonobvious
35 U.S.C. 282 Presumption of validity; defenses.
NB: A patent is presumed valid
A patent shall be presumed valid. Each claim of a
patent (whether in independent, dependent, or multiple
dependent form) shall be presumed valid independently
of the validity of other claims; dependent or multiple
dependent claims shall be presumed valid even though
dependent upon an invalid claim…
43
Validity
Other validity requirements include:
•
Definiteness
•
Written description
•
Enablement
•
Best mode
Requirements that should be satisfied before patent
issues
44
Enforceability
A patent is not enforceable when there is
• Patent misuse - Patentee uses patent as leverage
to obtain more market power than Congress
intended to convey through the grant of a patent
• Inequitable conduct - Patentee intentionally made
a misrepresentation or withheld material
information about the patentability of the invention
during the patent application process
45
How does the court decide these issues?
• Judge v. Jury
• Under Markman, the scope of the claims of
the patent - what the patent covers - is
thus decided by a Judge
• The jury decides facts - whether the patent
is valid and enforceable, whether there is
actual infringement, and whether that
infringement was willful
46
What are the stages of litigation?
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Pleadings
Discovery
Pretrial motions
Markman hearing
Trial
47
The Stages of Litigation
• Pleadings
• Complaint
• Answer
• Discovery
• Production of documents - Lab notebooks,
memos, emails, computer files, etc.
• Written discovery - interrogatories and
document responses
• Oral discovery (in and out of court) depositions and questioning of witnesses
48
The Stages of Litigation
• Discovery (Cont.)
• Experts - retained by both sides to review
the patent, the allegedly infringing product,
and related documents
– Non-testifying experts are retained as
consultants
– Testifying experts write a report giving
their expert opinion as to material
issues such as infringement, validity
and enforceability
» They are usually deposed by the
opposing counsel before trial and
testify at trial
49
The Stages of Litigation
• Pretrial motions
• Summary judgment - judge may rule on
issues where the facts are not in dispute
• Motion in limine - motion to exclude
evidence
• Markman hearing
• Judge determines the scope of the claims
of the patent, or what the patent covers
50
The Stages of Litigation
• Trial - the opposing sides present evidence
(both documentary and testimony) before a
jury, who determines if the patent is valid and
enforceable, if there was infringement, if the
infringement was willful, and what the
appropriate relief is
NB: In a bench trial, there is no jury and the Judge
decides the case
51
Relief
• Damages (money)
• Actual damages
• Lost profits
• Reasonable royalty
• Willful infringement? double or treble
damages
• Injunctive relief the court forces the defendant to
stop infringing
• Permanent v. preliminary relief
52
In what ways can YOU be involved in a
patent litigation?
• Produce documents
• Deposed during discovery
• Fact witness at trial
As an expert witness
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