Entrepreneur

The top 5 things companies should know about the America Invents Act

Monica Winghart is Executive Vice President and General Counsel for Article One Partners.

Recognizing the importance of a strong patent system and a global patent industry, President Obama signed into law the Patent Reform Act of 2011, otherwise known as the America Invents Act (AIA). With the advent of the next phase of AIA affecting the definition of prior art, patent filing rules and patent quality determinations, the key for entrepreneurs and small businesses is preparation.

A few things to consider:

1. Be the first to file

In March 2013, arguably the biggest effect on patent rights will be the change from the ‘first to invent’ standard to a ‘first to file’ system.

Currently, companies often spend years perfecting an invention before filing for patent protection. Under the old rules and the first to invent standard, with good record keeping showing the dates when a company made and pursued an invention, even if another company filed a patent application on the same invention, the first inventor could ultimately prevail by showing it invented first.

After March 2013, the US will follow suit with the European and Japanese patent systems which use a first to file standard for patent rights. Essentially, where two companies invent the same thing, it is a “race” to the patent office to see who files their patent applications first and take priority on patent rights. This cutthroat approach to patenting inventions is a motivation for inventors to quickly file for patent protection or risk losing out on those rights if another inventor files his patent application earlier.

2. Know your prior art

Prior art — e.g. information that has been made available to the public in any way, place, state, or form before filing a patent — can be used to validate, defend, protect or invalidate a patent. It is a powerful asset to any entrepreneur looking to expand their patent portfolio. If a new invention has been described anywhere in prior art before the date a patent application has been filed, it may not be possible to secure patent rights or those patent rights may later be found to be invalid in court or by the USPTO

With non-practicing entities increasingly setting their sights on small businesses, the urgency of locating and using good prior art in patent matters is no longer solely a big company issue. The AIA changes to the definition of prior art have thrown open the door to more publications and uses outside of the US and the search for prior art is now a globalized one. Prior art from around the world in every language can now be used as a valuable asset in litigation battles or administrative review proceedings.

Beyond disputes and patentability review diligence, it makes sense that increasing your knowledge of the prior art while developing your patent strategies and filing applications can improve the chances that your patents will strongly stand up against challenges. Using traditional legal search strategies can provide significant amounts of patent prior art, but often fall short on discovery of non-patent literature and non-English documents. Crowdsourced prior art searches provide one-stop, fixed cost and time-efficient options for developing a comprehensive review of the relevant prior art in a particular technology space.

3. Be prepared to be challenged

Even if you have successfully obtained a patent, the possibility still exists that your patent rights may be challenged through litigation or administrative proceedings.

Under the AIA changes, any person can challenge the validity and scope of a patent through a process called Post Grant Review (PGR). These PGR proceedings conducted by the USPTO allow for the re-inspection of a patent, and any prior which is relevant thereto, to ensure that the patent accurately captures the content and scope of an invention over the prior art. A request for PGR consideration can be filed by anyone within the first nine months of a patent being granted.

One note to filing a PGR request is that the party wishing to challenge a patent cannot do so anonymously, but instead must disclose their identity and state why they are challenging the patent. Since PGR proceedings allow for limited discovery and positional submissions, it may offer a faster and more cost effective alternative to litigation.

4. Share with care

The way to best defend your innovation and patent strategy is to carefully watch what you publish on your blog, Facebook, Twitter, and company websites, as well as more traditional disclosures through professional organizations, partner relationships and product offerings. As more and more references fall into the guise of prior art, disclosures that may not have previously affected your priority of invention, might now impact your potential to claim that you are entitled to patent rights. Moreover, with the advent of first to file, disclosing too much information without first filing for patent protection, might ‘tip your hand’ to competitors and result in someone else filing for your invention before you do. Keeping a close eye upon your communications, patent strategy and the activities of your competitors will improve your patent positions and ensure that you have preeminent patent rights.

5. Know your timeframe

As a part of the AIA reforms, entrepreneurs and small businesses will now have a more affordable option to choose a 12-month fast track route to getting their applications through the approvals process. In an effort to promote creation of new American jobs, AIA entitles small entities and independent inventors to a 50 percent discount on the $4,800 fee for the fast track option.

As an additional incentive to promote efficiency in the patent filing process, AIA encourages e-filing of patent applications through the USPTO website. Those who wish to file patents via the traditional paper method will be charged an extra $400. Those who file electronically will not be charged the paper filing fee, and will receive instant email updates when their submission has been reviewed and approved.

Previously, patents were expensive and could take as long as three years to undergo the lengthy approvals process. The new rules can help accelerate the time to secure issued patents. With patent ownership being critical to the valuation of new technologies, securing funding and market position and the production of products, acceleration under the new rules will be helpful to growing companies.

Small businesses that understand the implications of the AIA will find themselves equipped to win in the new patent environment, while being uninformed of these changes can place smaller companies at risk from competitors and patent litigation. Awareness and preparedness will go a long way towards success.

Monica_WinghartMonica Winghart has 15 years of experience in Intellectual Property. Her experience as an executive vice president at Article One Partners and as senior counsel for The Clorox Company, combined with a previous career as an engineer, uniquely position her to understand the IP environment today. She currently serves as the Chair of the Intellectual Property Committee of The Association of Corporate Counsel for 2012-2013 and is involved with several community service and pro bono projects in the San Francisco Bay area.


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