ELECTRONIC NEWSLETTER

Abelman, Frayne, &Schwab

THE NEW IMPORTANCE OF
PROVISIONAL PATENT APPLICATIONS ^[1] , ^[2]

Summary

   Under the recently enacted America Invents Act, the United States patent laws are transformed from a first to invent system to a first inventor to file system. Also, with limited exceptions, the United States will now apply an absolute novelty standard for patentability. These are the most significant revisions in the history of the U.S. patent laws.

   In light of these changes, many companies should, as a matter of best practices, revise in-house patent filing procedures (a) to encourage inventors to prepare and submit preliminary invention disclosures early, even while development and testing are ongoing; (b) to file U.S. provisional patent applications promptly in order to lock in an early invention date; and (c) to file additional provisional patent applications if significant improvements are conceived during the one year term of the provisional, so as to lock in an invention date on a rolling basis.

Discussion

   Under prior law, the patent rights of an inventor were secured as of the date on which the invention was reduced to practice, and sometimes even on the date when the invention was conceived (provided that the inventor thereafter exercised diligence in reducing the invention to practice). There was no particular hurry to file a patent application in the United States Patent and Trademark Office, other than to obtain a filing date to secure foreign patent rights.

   Due to the high costs often involved in preparing and filing patent applications, many companies, prior to authorizing a patent application to be written, conducted a prior art search to determine whether a meaningful patent was likely to be granted. Some companies had patent committees which periodically reviewed invention disclosures submitted by inventors to determine whether to go forward with the patenting process.

   Similarly, a company could proceed to offer for sale products utilizing the invention without losing the right to obtain a U.S. patent (and foreign patents if disclosure was avoided), provided that a U.S. patent was filed within one year. This afforded companies a period of time in which management could assess the future commercial value of the product and the technology before committing to the cost of preparing and filing a patent application.

   As of March 2013, a company which delays filing of a U.S. patent application risks losing its patent rights in two ways. First, if during the period of delay a later inventor conceives a similar invention and is the first to file a U.S. (or PCT) application, the first inventor loses his or her right to obtain a patent. Second, if during the period of delay, the invention is independently disclosed in a publication, offered for sale, or publicly used by a third party, the first inventor loses his or her right to obtain a U.S. patent.

   Conversely, a company which files a U.S. patent application promptly may benefit in obtaining patents it would not have obtained under the present law, because the actual first inventor delayed in filing.

   Filing a provisional application has several advantages over filing a non-provisional U.S. or PCT patent application. A provisional application has few formalities and does not require claims or formal patent drawings, and is therefore less expensive and time consuming to prepare than a regular patent application. The filing fee is also significantly less. Finally, the applicant has the opportunity to supplement the original specification over the course of the twelve month term by filing additional provisional applications as new developments are made. This has the advantage of locking in the original concept early, and locking in significant new developments prior to filing the non-provisional patent application (which would then be based on, and claim the priority dates of, each of the provisional applications filed in such 12 month period).

   However, it is important to note that, even though the provisional application specification may be abbreviated compared to a non-provisional patent application, it should be drafted with sufficient description that it will provide support (particularly an enabling disclosure) for the non-provisional application when filed. Otherwise, the non-provisional patent application, when filed, will not be entitled to the provisional application filing date.

   After filing a provisional application, the applicant has one year to perform the pre-filing review that is currently performed by many companies, such as conducting a prior art search and patentability study, or testing the marketability of the product. Thus, by the time non-provisional and international patent applications must be filed, management will be in a better position to know the likelihood of obtaining a meaningful patent and the potential value of the invention. And, because foreign filings may be based on the provisional patent application filing date, disclosures which occur after the U.S. provisional has been filed will not adversely affect foreign filing rights.

   Some commentators have noted that, in lieu of filing a provision application, an inventor has the option to disclose the invention to protect the right to obtain a patent. While disclosure will secure one year to file in the U.S. as against subsequent disclosures or patent application filings, in the case of companies who do business abroad, early disclosure is not a good option, insofar as filing rights outside of the United States will be lost.

   In sum, the revised patent act provides a strong incentive to companies to file provisional patent applications to prevent the potential loss of important patent rights, both in the U.S. and internationally. Companies should encourage inventors to prepare and submit preliminary invention disclosures promptly, even if development work and testing is ongoing, and to submit updates as significant improvements are developed.