Press Release

U.S. Patent & Trademark Office Dramatically Changes Rules of the Game for Patent Disputes Known as "Interferences"

10/7/2004
With disputes burgeoning in multi-billion dollar biotech & medical device arenas, suddenly inventors, companies and patent lawyers face "a brave new unknowable world"

Washington, D.C. / San Francisco (October 7, 2004) -- The U.S. Patent & Trademark Office (PTO) has without fanfare reissued the rules governing the essential patent-dispute mechanism known as "interferences," leaving experienced patent lawyers pondering how strategy will shift for individuals and businesses seeking to protect their inventions and proprietary business processes.

"All the certainty we had with the previous rules has been swept away by the PTO," says Barry Bretschneider, a senior patent litigator and interference practitioner based in the Northern Virginia office of law firm Morrison & Foerster LLP. "It's a brave new unknowable world."

"Interference practice has always placed a premium on getting on top of your case early," says Matthew Kreeger, an intellectual property litigator and interference practitioner in Morrison's San Francisco office. "The new rules require even more work up front. Parties will be required to identify, at a very early stage, all of the issues they intend to raise during the interference, and won't be allowed to raise new issues without a strong excuse for raising them late."

Patent interferences resolve disputes about which of competing inventors were the first to invent, since U.S. law awards a patent to the party who can prove priority of inventorship rather than priority of filing with the PTO. Though the total number of interferences has been declining of late, they are on the upswing for biotechnology and medical device patents, representing untold billions of dollars in intellectual property interests. The outcome of a patent interference can make or break a company; in short, says Mr. Bretschneider "it is not something you want to lose."

The intricacy of the new rules (which run on to 60 pages) makes them nearly impossible to summarize, say Mr. Bretschneider and Mr. Kreeger. However, some generalities can be drawn.

  1. The new rules lodge unprecedented discretion with a single administrative patent judge, even effectively authorizing the rewriting of some rules on a case-by-case basis. For instance, §41.104 (b) reads: "An administrative patent judge may waive or suspend in a proceeding the application of any rule in this subpart, subject to such conditions as the administrative patent judge may impose."
  2. Once an interference begins, the process is dramatically front-loaded. "You'd better have your track shoes on," says Mr. Bretschneider. The PTO also recently began publishing all patent applications within 18 months, thus shortening deadlines for initiating an interference. "If you don't keep an eye on what your competitors are doing, you can run into real trouble," Mr. Bretschneider says.
  3. The rules codify the PTO's practice of using a "two-way test" to determine when to declare an interference, which restricts interferences to cases in which both parties' claims would prevent the others' claims from issuing. In addition, a party seeking to provoke an interference under the new rules must make a more detailed showing before the PTO will declare an interference. "These changes are part of trend at the PTO to limit the situations where an interference will be declared," explained Mr. Kreeger. "The result is that in many cases, contests between competing inventors will be left to be resolved in federal district court."
  4. The rules will change procedure and strategy on both the offensive and defensive side of a patent dispute, causing a potential for costly errors on both sides as everyone plays catch-up. "A lot of people will make mistakes they never would have made before," Mr. Bretschneider says.

To speak with Mr. Bretschneider or Mr. Kreeger, please contact Keith Emmer at 212-721-9979, Bryonie Byers at 202-887-8730, or Kerry Efigenio at 415-268-7210.

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