The America Invents Act 0f 2011 (formally titled “Leahy-Smith America Invents Act”) was signed by President Obama on September 16. It is the most extensive patent reform in the United States in over 50 years. The Act makes many changes to the current system, and this blog post is meant to give a simple outline for the changes that will affect most small inventors.
The United States was the only major country with a first-to-invent system. This change has its positives and its negatives. The main negative is that it really benefits big companies. Patents are very expensive and small inventors cannot always afford to patent their inventions right away, at least not until they are sure that the invention will be marketable. Under the first-to-invent system, a small inventor could have invented something and not been able to patent it for any number of reasons when a large company comes in and patents the same invention. The first-to-invent system would ensure that the small inventor would still have priority if he can prove he was actually the first to invent the invention. Now, whoever patents the invention first has priority.
The biggest change is that it changes our system from a “first-to-invent” system to a “first-to-file” system.
This may force small inventors to consider patenting inventions more quickly so they don’t lose priority. Additionally, the United States Patent and Trademark Office (USPTO) may see an increase in the number of provisional patents filed. A provisional patent is essentially a place holder. It is a bare-boned application that is never examined. It lasts one year and if the utility patent application is filed within that one year period, it can claim priority back to the provisional date. Also, the filing price of a provisional is much less than that of a utility patent application.
Benefits of the first-to-file system
The positive of the first-to-file system is that it may cut-down on some of the patent litigation. With the first-to-invent system, there can be major lawsuits in order to determine who invented first. With the first-to-file system, those lawsuits will be avoided because the only thing that will matter regarding priority will be the date on the patent. Additionally, there will be no more interference proceedings. Interference proceedings are where multiple inventors file near-simultaneously for the same invention. Now, the filing date will simply be used to solve those disputes.
Another big change in to the patent system concerns the fees. Under the American Invents Act, the USPTO will be able to set its own fees, as opposed to the previously system where Congress set the fees. The fees collected by the USPTO are placed into escrow, and the USPTO must petition for their release. This makes it less likely that Congress will divert funds to other purposes, as it has done in the past with USPTO funds. Unfortunately, the new fee schedule, however, encourages the USPTO to grant patents. This is because the cost of examination is recovered from issuance and maintenance fees. And there is really no damage to the USPTO caused by the issuance of bad patents.
Those are just a couple of the many changes that are being made to the patent system. Overall, the hope is that it will expedite the patent process somewhat, but hopes are not necessarily high. Only time will tell as to how these changes will affect the patenting process.