What a chemist needs to know about patent law

Committee On Patents and Related Matters

Galina YakovlevaValerie L. McDevittMarc A. McKithen

2

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)

3

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

4

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)

5

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

6

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 dateDesign patents – 14 years from grant date

7

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

8

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

9

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

10

Requirements for Patentability

• Novelty• Non-obviousness• Usefulness

Requirements that should be satisfied before application is filed

11

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.

12

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

13

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.

14

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”)

15

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

16

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.

17

Patent Prosecution

• “Prosecution” is the term given to the back-and-forth between the Patent Office (“PTO”) and the Applicant [or his attorney/agent]

18

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

19

Application – Order of Sections

• 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

20

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

21

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

22

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

23

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

24

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

25

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

26

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

27

Granted Patents

• Patent can be licensed for money or in exchange for another’s IP rights

– “fight patents with patents”

28

Technology Transfer Of A Patented Invention

29

The Value of An Invention is in the Using of It

Modified from Thomas Alva Edison

30

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

31

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.

32

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.

33

Targeted & Strategic Marketing

• E-mail• Snail mail• Newsletter• Web site• Symposia• Venture forums• Road trips to Corporations

34

Marketing Technology

• Non-confidential summary• Confidential summary• Letter of intent• An option• License

35

Major Steps in Tech Transfer

• Disclosure of Inventions• Record Keeping and Management• Evaluation and Marketing• Patent Prosecution• Negotiation and drafting of license

agreements• Management of active licenses

36

Factors governing license fees and royalties

• 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

37

Elements of the Agreement

• R&D sponsorship• Initiation Fee• Maintenance fees• Milestone payments• Royalties• Equity vs. Cash• Endowed Fellowships and Chairs• Incentives and Penalties• Sponsorship of Awards , Symposi

38

Patent Infringement Litigation

A form of civil litigation where a patent-holder (patentee) sues a defendant for infringing a patent.

39

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

40

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))

Dear Sir o

r Madam:

You are hereby notified th

at your

new adhesive branded as…

violates

U.S. Patent…

and you are hereby

directe

d to ce

ase and desis

t

immediately or w

e will

be force

d…

41

Infringement by Inducement

“Whoever actively induces infringement of a patent shall be liable as an infringer.” (35 U.S.C. 271(b))

42

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))

43

• Validity• Enforceability

Challenges To Patent

44

Validity

A patent is valid only if the following requirements for patentability are satisfied, including:

• Useful• Novel – i.e., it is not anticipated • NonobviousNB: A patent is presumed valid 35 U.S.C. 282 Presumption of validity;

defenses.

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…

45

Validity

Other validity requirements include:• Definiteness• Written description• Enablement• Best mode

Requirements that should be satisfied before patentissues

46

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

Enforceability

47

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

48

What are the stages of litigation?

• Pleadings• Discovery• Pretrial motions• Markman hearing• Trial

49

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

50

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

51

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

52

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

53

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

54

In what ways can YOU be involved in a patent litigation?

• Produce documents• Deposed during discovery• Fact witness at trialAs an expert witness

55

NY_MAIN 362047