New Patent Application Rules Set to Take Effect November 1, 2007
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1 INTELLECTUAL PROPERTY October 2007 New Patent Application Rules Set to Take Effect November 1, 2007 The United States Patent and Trademark Office (USPTO) has issued new rules for the patent application process that take effect on November 1, A complete copy of the New Rules, which were published in the Federal Register on August 21, 2007, may be accessed through the USPTO Web site at the following address: In brief, the New Rules modify existing prosecution practices and also present new requirements for practitioners. The modifications to existing practices include: (1) limitations on the number of continuation applications and Requests for Continued Examination ( RCEs ) that may be filed ( Application Practice ), and (2) limitations on the number of claims that may be pursued in an application and in an application family ( Claims Practice ) (i.e., no more than 5 independent claims or 25 claims total, without submission of an Examination Support Document ( ESD )). The new requirements include: (1) an obligation to cross-reference applications ( Cross-Referencing ), and (2) an obligation to make a submission if two or more pending applications share a common priority or filing date ( Rebuttable Presumption ). This summary will discuss the modifications to existing practice before addressing the new obligations. This summary will provide brief commentary and suggestions with respect to the New Rules. In addition, this summary provides a brief outline of some of the actions BARNES & THORNBURG LLP plans to take to assist the Applicant in view of these changes. I. Application Practice Application Practice has been modified by the New Rules. Under the New Rules, an application family is defined as the initial non-provisional application and the two continuation or continuation-in-part ( CIP ) applications that rely on the initial application for priority. The USPTO will permit an Applicant to file two continuation or CIPs and one RCE in an application family without a petition. Additional continuations, CIPs, or RCEs require a Petition.
2 A. CIP Applications CIP applications are treated differently under the New Rules. For all CIP applications, the Applicant must identify the claims that are supported by the prior-filed patent application. Claims that are not identified as having support in the prior-filed patent application will be examined based on the filing date of the CIP. While not required as a part of the identification of support, the USPTO additionally may require the Applicant to identify, by page and line or paragraph number, where the claims find support in the prior filed application. While the identification of support for claims presented in a CIP does not, by itself, present a problem, the misidentification of claims may raise difficulties in litigation. If claims are identified as being supported by the prior-filed application, when in fact they are not, a defendant may present a defense of inequitable conduct with respect to any patent issuing from the CIP application. Accordingly, it is imperative for the Applicant to properly identify those claims finding support in the prior-filed application. In addition, since the claims in a CIP application that are not supported by the prior-filed application will be examined based on the filing date of the CIP, the Applicant should carefully consider if the CIP should be filed. It may be prudent to file a new, initial application rather than a CIP application. B. Divisional Applications Divisional applications are specifically defined under the new rules to encompass only involuntary divisional applications. Voluntary divisional applications will be treated as continuation or CIP applications under these rules. A divisional application is properly filed if: (1) the prior application includes a requirement for restriction, and (2) the divisional application encompasses unelected, unexamined claims. A divisional application may not be filed if: (1) the Applicant traverses a restriction requirement, (2) the restriction requirement is provisional (i.e., a Requirement for Election of Species in an application with a claim generic to all of the species), or (3) the Applicant requests rejoinder of the claims. Under the New Rules, if the USPTO withdraws a Restriction Requirement, any divisional application that has been filed will no longer be proper. Accordingly, the Applicant will be required to convert the divisional application to either a continuation or a CIP application. The conversion will be permitted only if the Applicant has not exceeded the requirement of two continuation or CIP applications in an application family. As a result, it is possible, if the USPTO withdraws a Restriction Requirement, that an Applicant will be required to abandon the divisional application or file a petition for the additional continuation or CIP application. Divisional applications may be filed either in series or in parallel with the prior-filed application(s). The divisional application merely needs to satisfy the requirements of co-pendency under 35 U.S.C. 120 and 121.
3 While parallel filings are permitted, the Applicant should carefully consider if this is prudent. Since the USPTO may withdraw a Restriction Requirement and render the divisional application improper, it may be prudent to await the allowance of the prior-file application before filing the divisional application, thereby avoiding this pitfall, albeit unlikely. C. Continuation and CIP Applications For an application family, the Applicant will be permitted to file two continuation or CIP applications without petition. The Applicant also will be permitted to file two continuation applications in a divisional application family. A divisional application family is defined as the divisional application and the two continuation applications claiming priority thereto. CIPs may not claim priority to a divisional application. Accordingly, all CIPs must be filed from the initial application. The two continuations of the divisional application are restricted in scope to invention(s) disclosed and claimed in the divisional application. (See 37 C.F.R. 1.78(d)(1)(iii)(B).) As a result, the continuations of a divisional application are not the same as the continuations from the initial application. Continuations claiming priority to the initial application may claim disclosed but previously unclaimed subject matter. Continuations of divisional applications, on the other hand, are restricted to the scope of the claims presented by the divisional application. With respect to continuations of divisional applications, therefore, it is crucial to draft claims in the initial application as broadly as possible. Having presented broad claims in the initial application, the Applicant will be afforded the greatest flexibility when filing continuations of the divisional application. D. Optional Streamlined Continuation Practice Under the New Rules, a new practice is provided for continuation applications, referred to as Optional Streamlined Continuation Practice. Under the following conditions, a continuation application may be filed as an optional streamlined continuation, if: (1) the continuation application is complete (i.e., the application includes a specification, drawings and at least one claim), (2) the application discloses and claims only invention(s) disclosed and claimed in the prior-filed application, (3) the Applicant agrees that any election made in response to a restriction requirement carries over to the continuation application, (4) the prior-filed application is under final or appeal, and (5) the prior-filed application is expressly abandoned upon the filing of the continuation application. If these conditions are satisfied, the streamlined continuation will be placed on the Examiner s Amended (Regular Amended) docket. This means that the continuation application will be taken up by the Examiner in the same order as the prior filed application. In other words, a streamlined continuation will not be placed at the end of the Examiner s docket but, instead, will be placed on the docket in the same place as the prior filed application. The USPTO recommends use of the optional streamlined continuation application as an alternative to RCE practice during prosecution. While an excellent option for the Applicant seeking to obtain a patent as quickly as possible, this procedure may not be strategically prudent in every
4 application. If the Applicant wishes to extend the duration of prosecution for budgetary purposes or for reasons of examining products introduced into the marketplace by competitors, it may be more prudent to file a regular continuation rather than an optional streamlined continuation application. E. RCEs In an initial application family, the Applicant will be permitted to file one RCE only. Additional RCEs may be filed only after the successful submission of a Petition. In a divisional application family, the Applicant also will be permitted to file one RCE without petition. If the Applicant wishes to file additional RCEs, the Applicant may wish to consider the optional streamlined continuation practice outlined above. F. One More Application If one of three conditions exist, the New Rules permit the Applicant to file one more continuation application without a petition. One More continuation or CIP application will be permitted if: (1) a continuation or CIP was filed from a PCT application without entry into the national phase (i.e., a so-called by-pass application will not be counted as one of the continuation or CIP applications in an application family), (2) the prior-filed application was abandoned for failure to timely respond to a Notice under 37 C.F.R. 1.53(f) (i.e., a response was not filed in response to a Notice to File Missing Parts in the prior-filed application), or (3) in pending applications, two or more continuation or CIP applications were filed before August 21, In many pending applications, therefore, the Applicant may have this additional option available to it. G. Suggested Restriction Requirement ( SRR ) The New Rules establish a procedure for the Applicant to file a Suggested Restriction Requirement in an application so long as the USPTO has not: (1) issued a First Office Action on the Merits ( FOAM ) or (2) issued a Restriction Requirement for the application. Under this new rule, the Applicant may supply the Suggested Restriction Requirement together with an election of one of the inventions for further prosecution. If the election encompasses more than 5/25 claim threshold, the Applicant will be required to submit an Examination Support Document or cancel claims to fall below the 5/25 claim threshold. It may be prudent, therefore, for the Applicant to draft claims (or present a preliminary amendment in pending applications) that anticipate the application of the 5/25 claim threshold to applications. If drafted properly, the Applicant may be able to present an SRR to avoid a Notice from the USPTO with respect to the 5/25 claim threshold. H. Petitions A petition is required if the Applicant wishes to file more than two continuation or CIP applications or more than one RCE. The Petition must include a justification as to why a new amendment, argument, or evidence sought to be considered could not have been previously submitted during prosecution of the prior-filed applications.
5 One caution is presented in connection with petitions of this type: the USPTO has indicated that it will not grant a petition if the petition is filed solely to request consideration of newly discovered prior art. II. Claims Practice A. The 5/25 Threshold Under the New Rules, the Applicant may present up to 5 independent claims and 25 total claims in any single application. This is referred to as the 5/25 claim threshold. As a result, the Applicant is permitted to present up to 15 independent claims and 75 total claims in an application family or in a divisional application family. If the Applicant wishes to exceed this claim threshold, the Applicant is required to present an Examination Support Document ( ESD ), which is discussed in greater detail below. An ESD must be filed before a FOAM in an application if the Applicant desires to present more than the 5/25 claim threshold. If an ESD is not filed, the Applicant will not be permitted to exceed the 5/25 claim threshold during prosecution. Given the onerous burden associated with the preparation and filing of an ESD, given the expected high cost of preparing and filing an ESD, and given the prosecution history estoppel effect of an ESD, the Applicant should carefully consider if an ESD is prudent for an application. Further details are provided below. B. Patentably Indistinct Claims Under the New Rules, multiple applications that meet the requirements for cross-referencing will be compared to determine if the applications present patentably indistinct claims ( PICs ). Claims are patentably indistinct if they meet the one-way test for obviousness-type double patenting. (See M.P.E.P. 804.) Under the one-way test, claims are patentable indistinct if claims in the later-filed application would be anticipated or rendered obvious by at least one claim in the patent or the earlierfiled application. Multiple applications with PICs will be treated collectively under the 5/25 claim threshold. For example, assume that two applications A and B are pending, each of which contain 3 independent claims and 20 claims total (i.e., each contain 3/20 claims). Application B includes at least one claim that is patentably indistinct from the claims in Application A. The USPTO will consider both applications to have 6/40 claims since at least one of the claims in Application B is patentably indistinct from Application A. Clearly, 6/40 claims exceeds the 5/25 claim threshold. Once the USPTO determines that the two applications contain patentably indistinct claims the USPTO will issue a Notice (like a Notice to File Missing Parts). In response, the Applicant will be required to: (1) submit an ESD, thereby permitting the Applicant to exceed the 5/25 claim threshold, (2) cancel the patentably indistinct claims from one of the applications, or (3) amend the applications so that, collectively, they present less than the 5/25 claim threshold. In making the determination if two or more applications contain more than the 5/25 claim threshold, the USPTO will not consider withdrawn claims or claims in patents. In addition, the USPTO will exclude claims that fall into one of four categories: (1) a Notice of Allowance was issued
6 in one of the applications, (2) one of the applications is abandoned, (3) a notice of appeal has been filed to the Federal Circuit under 35 U.S.C. 141 in one of the applications, or (4) a civil action under 35 U.S.C. 145 or 146 has been filed in one of the applications. Appeals to the Board of Patent Appeals and Interferences do not remove claims from consideration under these guidelines. Given that the 5/25 claim threshold applies to pending applications where a FOAM is not mailed before November 1, 2007, it may be prudent to review all pending cases where claims in excess of the 5/25 claim threshold are presented. Unless the Applicant is interested in submitting an ESD, it may be prudent to prepare and file a preliminary amendment to cancel claims, thereby placing the application under the 5/25 claim threshold. Alternatively, the Applicant should consider if an SRR would be appropriate. C. Rebuttable Presumption If two or more applications meet one of the following conditions, a rebuttable presumption will arise with respect to PICs. Specifically, the USPTO will presume that the two (or more) applications present PICs if the applications have: (1) a common owner, (2) at least one inventor in common, (3) substantially overlapping disclosures, and (4) a claimed filing or priority date that is the same as the claimed filing or priority date in the other application (or patent). If the rebuttable presumption exists, the Applicant is required to take action. The Applicant must either: (1) rebut the presumption by explaining how the applications contain only patentably indistinct claims or (2) submit a terminal disclaimer. The Applicant must take action within the later of: (1) four (4) months from the actual filing date of the application or from the date on which the national stage commenced, (2) the date on which the patentably indistinct claim is presented, or (3) two months from the mailing of the initial filing receipt in the other application. If the other application is pending, the Applicant also must explain why there are two or more pending applications that contain patentably indistinct claims. It is prudent, therefore, to review application families where there is a common filing or priority date. In such application families, action will be required. III. Cross Referencing Under the New Rules, all pending non-provisional applications must be cross-referenced with all other pending and patented non-provisional patent applications that: (1) have filing and/or priority dates that are the same or within two months of one another; (2) name at least one inventor in common; (3) are owned by the same person or are subject to an obligation of assignment to the same person. (37 C.F.R. 1.78(f)(1)(i).) The obligation to cross-reference pending applications to other pending applications and patents must be satisfied within the later of: (1) four months from the actual filing date of the nonprovisional patent application under 35 U.S.C. 111(a), (2) four months from the date on which the national stage commenced under 35 U.S.C. 371(b) or (f), or (3) two months from the mailing date of the initial filing receipt in the other patent application. (37 C.F.R. 1.78(f)(1)(ii).) This obligation extends not only to applications filed after November 1, According to the Clarification provided by the USPTO on October 10, 2007, the cross-referencing obligation does not apply to applications filed before November 1, 2007 where the applications have filing or priority
7 dates within two months of one another. However, for applications pending on November 1, 2007, the Applicant will be required to identify any other pending application or patent with the same actual filing date or the same benefit or priority filing date as the subject application. By February 1, 2008, all pending applications that meet these requirements must be crossreferenced. The cross-reference must be made in a separate filing. The USPTO will provide a form for this purpose. It is important to note that any cross-referencing of applications in a Cross-Reference section of a pending application will not satisfy the requirements under this rule. It is understood that a submission cross-referencing applications will be relied upon by the USPTO to determine whether applications contain PICs. The cross-reference also will be used by the USPTO to assist with assessing if an obviousness-type double-patenting rejection should be made between an issued patent and a pending application. Under this rule, the phrase owned by the same person or subject to an obligation of assignment to the same person in 37 C.F.R. 1.78(f)(1)(i)(C) (and in 1.78(f)(2)(i)(C) and 1.78(f)(3)) has the same meaning as it does in 35 U.S.C. 103(c). See M.P.E.P (l)(2). A quick overview of this section of the M.P.E.P. reveals that an owner is a common owner when it owns 100% of the patent or 100% of the entity that owns the patent. For example, a parent company that owns 100% of a subsidiary company will be considered to be a common owner of the patents owned by the subsidiary. Following submission of an Application Cross Reference Submission, the USPTO will determine whether they believe any cross referenced applications should be joined together because the applications include at least one PIC. If appropriate, the USPTO will issue a Notice, requiring a response from the Applicant. The New Rules do not prescribe any penalty for failure to cross-reference applications. This obligation appears to fall within the Duty of Disclosure under 37 C.F.R Accordingly, there is the potential for defenses of inequitable conduct to be raised in litigation, should a cross-reference not be submitted during prosecution. IV. Examination Support Documents ESDs must be filed in an application before the mailing of a FOAM if the Applicant wishes to exceed the 5/25 claim threshold. An ESD must include several parts, such as: (1) a pre-examination search statement, (2) a listing of the references deemed most closely related to the subject matter of each claim, (3) an identification of the claim limitations disclosed by each reference, (4) a detailed explanation of patentability, and (5) a showing of support for the claim limitations under 35 U.S.C. 112, 1. There are additional requirements not listed above. As this brief listing highlights, the requirements for an ESD are significant. With respect to the pre-examination search, for example, to make the pre-examination search statement, the Applicant must have searched U.S. patents, foreign patents, and non-patent literature. In connection with these searches, the Applicant must provide an indication of the field of the search (by U.S. class and subclass), the date of the search, and any search logic used for electronic database searches. With
8 respect to the detailed explanation of patentability, the Applicant must discuss why each of the claims are not anticipated or rendered obvious by the references cited. If an ESD is filed, the Applicant may be required to submit supplemental ESD during prosecution of an application. Specifically, if the Applicant cites new art, the Applicant may be required to discuss how the claims are patentable over that new art. In addition, whenever an amendment is filed, the Applicant may be required to discuss how the amended claims are patentable over the cited art. In summary, therefore, the obligations imposed by this portion of the New Rules are significant and should not be undertaken lightly. Not only is there a potentially significant cost associated with the submission of an ESD (and any supplemental ESDs), but each ESD presents prosecution history estoppel that will be relevant if the resulting patent is litigated. V. The Effective Dates for the New Rules Having provided a broad overview of the impact of the New Rules, there are a number of clarifying points that need to be made with respect to notable dates and also due dates. The first date of interest is the August 21, 2007 date. As noted above, if a pending patent application has enjoyed two or more continuation or CIP applications filed before August 21, 2007, the Applicant may be entitled to one more application under these rules. The second date is November 1, 2007, the effective date of the rules. The different effects of this due date on application practice are outlined below. For all applications pending on November 1, 2007, the limitation with respect to continuation applications, CIP applications, and RCEs applies, subject to the possible one more application rules. For all applications filed on or after November 1, 2007, the 5/25 claim threshold applies. The 5/25 claim threshold also applies to pending applications where a FOAM was not mailed prior to November 1, For all applications pending on November 1, 2007, the Applicant is required to file a crossreferencing submission within the later of: (1) four months from the actual filing date of the application, (2) two months from the mailing of the initial filing receipt in the other application, or (3) February 1, The third date is February 1, 2008, which is the final due date for cross-referencing pending applications. For applications pending on November 1, 2007, if the application exceeds the 5/25 claim threshold, the Applicant will receive a Notice from the USPTO to that effect. The Applicant will be required to respond by: (1) filing an ESD, or (2) canceling claims to fall below the 5/25 threshold.
9 VI. BARNES & THORNBURG LLP With respect to these due dates, BARNES & THORNBURG LLP will docket the newly-created due dates and provide reminders as the due dates approach. This is consistent with the firm s existing practice. Separately, absent instructions to the contrary, BARNES & THORNBURG LLP will review all pending cases and will prepare appropriate cross-referencing submissions to the USPTO. In addition, where needed, BARNES & THORNBURG LLP will submit rebuttals to the rebuttable presumption (with respect to PICs). The firm, of course, will seek the Applicant s guidance with respect to these types of submissions For more information on the new rules, contact the firm's intellectual property attorneys in the following offices: Chicago ( ), Elkhart ( ), Fort Wayne ( ), Grand Rapids ( ), Indianapolis ( ), South Bend ( ), Washington, D.C. ( ). This Barnes & Thornburg LLP publication should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own lawyer on any specific legal questions you may have concerning your situation. Please send address changes or requests to opt in or out of these alerts to jodie.daugherty@btlaw.com.
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