Sunday, 16 October 2011

America Invents: what do litigators need to know?

All smiles as President Obama signs
the Act -- but who will be smiling
once the litigation commences?
PatLit asked leading US intellectual property practice Faegre & Benson for some comments for its largely non-US-based readership on what the recently-enacted America Invents Act means in terms of litigation.  The firm has kindly responded to this request for an 'insider's view' with the following piece by Calvin Litsey and Kevin Wagner, whom we thank for their effort.
"The America Invents Act (AIA) has received a lot of press but, given its staggered implementation, its impact on patent litigation in the U.S. in the short term is likely to be minor. For example, the fundamental shift from “first to invent” to “first to file” only applies to patents filed after March 16, 2013, so the first litigation under the new system is not likely to occur until some point in 2014. In the meantime, smaller changes relating to joinder of multiple defendants, the best mode defense, the prior commercial use defence, defences relating to inventorship, and use of opinions of counsel in litigation will change some current litigation practices. 

Multiple Defendants 
It has become common practice for plaintiffs (especially for non-practising entities) to sue multiple defendants in the same action. The AIA makes this tactic much more difficult. With immediate effect, multiple defendants cannot be sued in the same action “based solely on allegations that they have infringed the patent.” Instead, joinder is allowed only when defendants are alleged to be liable jointly, severally, or in the alternative, and when there are common questions of fact to all defendants. This provision is largely a win for defendants, because it raises litigation expenses for plaintiffs and may expose plaintiffs to inconsistent claim construction rulings and multiple invalidity determinations. Because courts will still have the opportunity to consolidate cases for discovery and claim construction, however, not all of these advantages for defendants may be fully realized. Defendants who wish to pool resources can opt out of this provision. 

Best Mode 
One infrequently-used defence to a patent infringement is that the patent failed to disclose the best mode of practising the claimed invention that was known to the inventors as of the filing. The AIA eliminates this defence in all newly-filed cases. 
Prior Commercial Use 
For all patents issued after September 16, 2011, the AIA expands the prior commercial use defense beyond its traditional use in business method cases. Under this defense, almost any claim of infringement can be defeated by showing the defendant commercially used the invention at least 1 year before the filing date of the patent. 
Another rarely-used defence is that an asserted patent is invalid because it names the wrong inventors. In all cases filed after September 16, 2012, the AIA eliminates the need to show lack of “deceptive intent” before inventorship can be fixed, effectively eliminating this defence. 
Opinions of Counsel 
When intent becomes an issue, as for allegations of willfulness or induced infringement, plaintiffs frequently seek to introduce the lack of an opinion of counsel as evidence of the defendant’s bad intent. Case law already discouraged this practice for willfulness, but this approach was permitted for inducement claims. The AIA eliminates reliance on the lack of an opinion of counsel for both situations for patents issued after September 16, 2012. 
First to File 
The change to a “first to file” system was implemented largely by changing the definition of prior art. For patents filed after March 16, 2013, prior art includes anything patented, described in a printed publication, in public use, on sale, or otherwise available to the public before the filing date of the claimed invention. This change expands prior art to include third-party prior art dated less than 1 year before the patent filing, eliminates the ability of the patentee to “swear behind” certain prior art, and allows use of additional foreign prior art. The AIA does include exceptions that allow some public disclosure by the patentee before patent filing. Concurrent with these changes, obviousness will be determined as of the filing date, rather than the date of invention".

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