PRESENTATION ON PATENT TERM ADJUSTMENT (PTA) IN US

PREPARED BY:Vikram Jeet Singh

PATENT TERM ADJUSTMENT (PTA) IN US

• HISTORY• AIM AND OBJECTIVE• American Inventors Protection Act (AIPA)• PATENT TERM FLOWCHART• Baseline” Patent Term Pre-GATT or GATT (17 or

20 years)• EXAMPLES• TWO IMPORTANT CASES• PRE AND POST AIA CORRECTIONS

HISTORYYEAR DESSCRIPTION/ACT TERM

1790 Congress enacted and President Washington signed “Anact to promote the Progress of Useful Arts”

Fixed the term of a patent at 14years from issue

Patent act of 1836

Permitted term extension of 7 addition years. A total of 21 years

1861 Congress gave all patents a term of 17 years from issue

17 year term remained the law for more than a century Last 30 years, Congress made Term of a utility patent increasingly complicated in a series of three major

changes to the Patent Act

1984 Drug Price Competition and Patent Term Restoration Act 1984 (Hatch-Waxman Act)

1995 Congress implemented the Uruguay Round of the GATT,harmonizing U.S. patent terms with many foreignjurisdictions. GATT included the Agreement on TRIPStreaty

Mandated a minimum patent termof 20 years from the applicationdate

This change prompted the U.S. Congress to create a system of PTA to compensate patentholders for certain application-processing delays at the USPTO)

1999 American Inventors Protection Act (AIPA) set forth most of the current rules for Patent Term Adjustment

Changes to Patent TermAdjustment, both from Congressand Courts

American Inventors Protection Act (AIPA)• Utility and plant applications filed on or after May 29, 2000

• Provides three (3) bases for adjustment under 35 U.S.C. §154(b)(1):– USPTO failure to take certain actions within specified time

frames “A” delay (35 U.S.C. § 154(b)(1)(A))– USPTO failure to issue a patent within three years of the filing

date under 111(a) or commencement date “B” delay(35 U.S.C. § 154(b)(1)(B))

– Delays due to interference, secrecy order, or successful appellate review “C” delay(35 U.S.C. § 154(b)(1)(C))

• Provides day-for-day adjustment for each failure or delay resulting in adjustment

HOW PATENT TERM ADJUSTMENT IS CALCULATED

• Patent Term Adjustment is calculated based on examiner and applicantdelays during patent prosecution.

• A delay = PTO delays in responding (the patent term would be extended 1day for each day of Patent Office delay)

• B delay = Pendency after 3 years (the patent term would be extended 1 dayfor each day after the 3 year period that the patent is not granted)

• C delay = Delay due to interference, appeal, secrecy orders (the patent termwould be extended 1 day for each day of the proceeding, order or appeal)

• Overlapping delays = Any overlap between A, B, or C delays• Applicant delay = Applicant’s failure to engage in reasonable efforts to

conclude examination

• PTA = A delay + B delay + C delay - Overlapping delays -Applicant Delay

Failure to take certain actions within specified time frames (14-4-4-4):

• Failure to initially act on the application within fourteen(14) months after filing date/commencement (patentswith issue date January 14, 2013 to present). Prior toJanuary 14, 2013, patents that issued from internationalapplications measured the start date from date that 35 USC371(c) requirements were fulfilled.

• Failure to act on a reply or act on an appeal brief withinfour (4) months after date the reply or appeal brief is filed

• Failure to act on an application within four (4) monthsafter a PTAB or court decision if allowable claims remainin the application

• Failure to issue the patent within four (4) months of thedate the issue fee was paid and all outstandingrequirements were satisfied

USPTO failure to issue a patent within three years pendency:• In an international (PCT) application, “date of

commencement of the national stage under 371” is start datefor the application

• In an application filed under 111(a), the filing date is startdate for the application

• The three-year period does not include time consumed by anyof:– Continued examination (RCE) under 35 U.S.C. § 132(b)– Secrecy order, interference, or any appellate review– Applicant-requested delays

• Delays caused by an interference proceeding(35 U.S.C. § 135(a))

• Delays caused by imposition of a secrecy order(35 U.S.C. § 181)

• Delays caused by successful appellate review (requires aPTAB/court decision reversing an adverse patentabilitydetermination)– all rejections of at least one claim must be reversed– In some instances, a remand shall be considered a decision

reversing an adverse patentability determination• These delays are the bases for patent term extension under Public

Law 103-465 (URAA)

PATENT TERM FLOWCHARTDetermine whether pre-GATT term applies, GATT term applies or both

terms applies

Calculate pre-GATT term (17 years) or GATT terms (20 years) or both

Add Patent term adjustment

Add any terminal disclaimer

Add any Patent term extension

Check for premature termination (Maintenance fees, Judgements etc)

“Baseline” Patent Term Pre-GATT or GATT (17 or 20 years)

• The baseline term of a utility patent (or plant patent) is either the pre-GATT 17 year term, or

the GATT 20 year term.

• The determination of which baseline term applies is governed by 35 U.S.C. § 154(c)(1): The

term of a patent that is in force on or that results from an application filed before the date

that is 6 months after the date of the enactment of the Uruguay Round Agreements Act [i.e.,

June 8, 1995] shall be the greater of the 20 year term as provided in subsection (a) [i.e., the

GATT term], or 17 years from grant, subject to any terminal disclaimers.

WHEN AN APPLICATIONFILED BEFORE JUNE 8, 1995,SPENDS LONG PERIODS INPROSECUTION BEFOREISSUANCE•Patent Application 06/316,203 wasfiled on October 29, 1981•Following a 19 year interference,it issued on March 28, 2006.

For GATT 29.10.1981+20 year= 29.10.2001

Pre-GATT 28.03.2006+17 years=28.03.2023

28.03.2023+1109= 10.04.2026Patent expiration date

EXAMPLEExample 1(facts)• Application filed under 111(a) on 5/1/09• RCE filed on 3/5/13• Notice of Allowance mailed on 7/1/13• Patent issues on 10/1/13• There were no “A” Delays or “C Delays”• No Applicant delays under 37 CFR 1.704(b) and (c)

Example 1 (Calculation)• Days from filing to issue is (5/1/09 -10/1/13) = 1615• Days RCE to NOA is (3/5/13 – 7/1/13) = 119• Days considered as “B” days = 1615-119= 1496• Overall “B delay” = 1496- 1097 = 399• Overall PTA = A + B + C- overlap – applicant delay• PTA = 0 + 399 + 0 – 0 – 0 = 399 days

Wyeth and Elan Pharma v. Kappos (as USPTO Director) (Fed. Cir. 2009)

The USPTO's view (shown below): The patentee is entitled to three years of PTA.

Wyeth's view (shown below): the patentee is entitled to four years of PTA

DECISION• Director had taken an incorrect view of how § 154(b)(2) applies when there is

“overlap” between “periods of delay” addressed by the statute.

• Affirmed an order by the District Court for the District of Columbia granting

summary judgment in favor of Wyeth, in which the lower court found that

the USPTO had misconstrued 35 U.S.C. § 154(b)(2)(A), and as a result, had denied

Wyeth a portion of the patent term to which it was entitled.

NOVARTIS v. LEE CASE (2013-1160, -1179), Decided: January 15, 2014• Facts:

Between June 2009 and May 2011, Novartis filed four lawsuits in the District Court for theDistrict of Columbia claiming that, for twenty-three of its patents, the Director hadimproperly determined the amount of patent term adjustment

NOVARTIS•Novartis claimed that the Director’sdeterminations of the patent termadjustment rested on two mistakeninterpretations of § 154(b)(1)(B)(i) as itapplies to an applicant’s request forcontinued examination under 35 U.S.C. §132(b)—a process, authorized by Congressin 1999, through which an applicant maytry to persuade an examiner to allow anapplication after an otherwise-finalrejection.•Novartis also claimed that denial of thestatutorily authorized term adjustmentsconstituted a taking of its property inviolation of the Fifth Amendment.

DIRECTOR1. Director treated time spent in any

continuing examination, no matter wheninitiated by the applicant, as not countingtoward the statute’s allotment to the PTOof three years before adjustment timebegins to accrue

2. Director treated as not counting towardthe three years both the time frominitiation of continued examination toallowance and, in addition, the time fromallowance to issuance—even though thelatter period is undisputedly countedtoward the three years in a case notinvolving a continued examination.

Decision of DC: November 15, 2012, the district court dismissedNovartis’s claimsUnited States Court of Appeals for the Federal Circuit: PTO waspartly correct and partly incorrect in its interpretation.• USPTO on the first point, holding that an RCE limits B delay regardless of when

during prosecution it is filed.• Court also agreed with Novartis that the time period from allowance to patent

issuance is not part of the "continued examination" process referred to in the statuteand may contribute to the B delay.

FUTURE FROM THIS CASE:• Patent holders may wish to review their recently issued U.S. patents to identify any

patents that took longer than 3 years to issue and in which RCEs were filed duringprosecution.

• Patent holders may wish to consider whether they are eligible to petition foradditional patent term for those patents in light of the Novartis decision.

• This holding is significant as it would extend the terms of many future patents,typically by a few days to a few months.

PRE AND POST AIA (AIA Technical Corrections Act)

PRE AIA• Applicants could petition to correct the

preliminary calculation, then petitionafter issuance, then file a civil action

POST AIA

• Patentees must petition for acorrection (within 2 months afterissue, extendable).

• Fourteen (14) month PTA period andthe three (3) year PTA period aremeasured from the same date: the dateon which an application was filedunder 35 U.S.C. § 111(a) in anapplication under 35 U.S.C. § 111; orthe date of commencement of thenational stage under 35 U.S.C. §371 in an international application.

On May 15, 2014, the USPTO published rules to implement the patent term adjustment (PTA) provisions of the Leahy-Smith America Invents Act (AIA) and the AIA Technical Corrections Act

EXAMPLE FOR DELAY• January 1, 2008: Foreign national application filing date

• January 1, 2009: International filing date

• July 1, 2011: Declaration filed and 35 U.S.C. § 371(c) met

• November 1, 2012: Restriction

• December 1, 2012: Election

• May 1, 2013: Allowance

• June 1, 2013: Issue fee paid

• November 5, 2013: Issuance

• As application was filed on or after June 8, 1995, the 20 year GATT term applies.• Baseline term expires on January 1, 2029.• This patent is also eligible for PTA because the application was filed after May 29, 2000.• The current A delay rules apply because the patent issued after the AIA Technical Corrections

Act became effective on January 14, 2013.• There is no B delay, C delay, overlap, or applicant delay in this scenario.

• Application entered the U.S. national stage 30 months after its international filing date, onJuly 1, 2011.

• Triggered a 14 month guarantee for the Patent Office to reply (i.e., by September 1, 2012.• A restriction qualifies as a response for purposes of 14 month A delay, the restriction on

November 1, 2012, was delayed by 61 days beyond the 14 month guarantee.• Applicant‟s election on December 1, 2012 triggered a 4 month guarantee for a reply by the

Patent Office (i.e., by April 1, 2012.• Allowance from the Patent Office on May 1 was delayed by 30 days beyond the guarantee .• Payment of the issue fee on June 1, 2013, triggered a guarantee of issuance in 4 months (i.e.,

by October 1, 2013).• The actual issuance on Tuesday, November 5 was delayed by 35 days beyond the 4 month

guarantee.

SOLUTION

• delay is 61 days, plus 30 days, plus 35 days, or 126days.

• Assuming no other effects, the expiration of thispatent is 126 days after the baseline expiration date,or May 7, 2029.

• 01.01.2009+20 years+126 days= 07.05.2029

PFIZER, INC. v. MICHELLE K. LEE (2015-1265); Decided: January 22, 2016

• FACTS: On May 2, 2003, Wyeth filed Patent Application No. 10/428,894(“’894 application”) entitled “Calicheamicin Derivative-Carrier Conjugates,” whichgenerally claimed a pharmacological method utilized in the treatment of cancer.

• The ’894 application eventually issued as the ’768 patent on April 10, 2012. At thetime of filing, pursuant to 37 C.F.R. § 1.136(a)(3), Wyeth filed an authorization forthe PTO to charge all required fees necessary for it to qualify automatically for allauthorized extensions of time during the pendency of the ’894 application.

• On July 28, 2003, the PTO mailed a Notice to File Missing Parts of Non-provisional Application.

• Wyeth filed the missing parts of its application on December 8, 2003.• The statutory deadline for the PTO to issue its first office action expired on July 2,

2004, fourteen (14) months from the date the application was filed.• On August 5, 2005, having received no office action, Wyeth sent a letter to the PTO

asking when an office action on the merits might be expected.

• On August 10, 2005, 404 days after the July 2, 2004 deadline, the PTO mailed arestriction requirement. A restriction requirement informs the applicant that “two ormore independent and distinct inventions are claimed in one application,” and thatthe applicant is required to elect one of the inventions if the applicant wishes tocontinue prosecuting the application.

• The deadline for Wyeth to reply to the restriction requirement was extendedautomatically for up to six months based on Wyeth’s previously filed authorizationfor extension of time.

• Accordingly, the deadline for Wyeth to respond was February 10, 2006. OnFebruary 6, 2006, Wyeth participated in a telephone interview with the Examinerand explained that the restriction requirement had omitted claims 75, 76, and 103-106 from its categorization of the various claims in the application.

• During the interview, the Examiner acknowledged that the restrictionrequirement was not complete; he agreed to withdraw it and issue a correctedrestriction requirement.

• The PTO issued a corrected restriction requirement on February 23, 2006, 601days after the July 2, 2004 deadline. Appellants were given a new deadline torespond to the corrected restriction requirement, which was also extendedautomatically to six months.

• On May 22, 2006, Wyeth filed its response.

• PTO delayed the mailing of a separate office action with respect to theapplicants’ Request for Continued Examination (“RCE”).

• The PTO’s delay with respect to the RCE amounted to 280 days of additional ADelay.

• The propriety of that calculation is not at issue in this appeal. Prosecution of the’894 application continued until October 11, 2011, when the PTO issued aNotice of Allowance.

• On April 10, 2012, the ’894 application issued as the ’768 patent, reflecting atotal PTA award of 1291 days, of which 684 days were attributed to A Delay.

• The PTO calculated this A Delay based upon: (1) the issuance of the examiner’sfirst restriction requirement on August 10, 2005, 404 days beyond fourteenmonths from the date on which Wyeth filed the ’894 application, and (2) theissuance of the response to Wyeth’s RCE on April 22, 2011, 280 days beyondfour months from the date on which the RCE was filed.

• The PTO did not award A Delay for the 197 days that elapsed between theissuance of the first restriction requirement and the mailing of the correctedrestriction requirement.

• It is that 197 days which are at issue.

CAFC DECISION• 37 CFR § 1.704 provides that an applicant submitting a deficient paper to

the USPTO reduces available PTA until the deficiency iscorrected. Conversely, the court decided in Pfizer that the USPTOmailing a deficient paper to the applicant does not accrue PTA (as longas the paper satisfies the § 132 notice requirement). The court did notacknowledge this discrepancy between deficient applicant action thataccrues delay versus deficient USPTO action that does not accrue delay.

• For now, in order to help maximize PTA, applicants may be wise todouble check filing papers for any omissions before their submission tothe USPTO and to double check in a timely fashion USPTO actions forany deficiencies in order to bring them to the USPTO’s attention forcorrection as soon as possible.

THANKS