“The USPTO should tighten restriction practices and enhance examination of continuation applications. It must leave for Congress the policy decisions on how best to address ‘patent thickets’ for drug-related inventions.”
The proposed rule changes to Terminal Disclaimers to overcome double patenting have not yet been finalized. If the U.S. Patent and Trademark Office (USPTO) decides to finalize these changes as the next step in its dreams of slaying the demons of high drug prices with a single blow by extorting concessions from patent applicants in terminal disclaimers, those finalized rules will be challenged. I have released an online version of a pre-print paper titled “How to Resolve Double Patenting,” which argues against the proposed rulemaking as being both ill-conceived and impermissible. The paper lays out the history of double patenting and how any finalized rules could be challenged. It also rebuts some of the arguments advanced by Professor Lemley in support of the proposed rule changes in his recent online article titled “How to Fix Double Patenting.”
A Rule Based on Fantasy Rather Than Statute
Despite clear language in multiple different patent statutes that each claim in a patent stands on its own, the extorted concession in the proposed rule changes would doom an entire patent family if only one claim in one patent in that family falls. The USPTO concedes its fantasy of rulemaking has no visible means of statutory support by changing the name of the rule from obviousness-type double patenting to nonstatutory double patenting. The only basis for authority to implement the proposed rule changes asserted by the USPTO are unsupported public policy arguments and reliance on a CCPA case that has been effectively overruled. (In re Van Ornum 686 F.2d 937 (CCPA 1982). The majority opinion in that case admits the common ownership requirement is a substantive rule. That admission squarely places the proposed rule changes outside the scope of the USPTO’s rulemaking authority.
The USPTO’s attempt to enact patent policy in a single, sweeping blow impermissibly usurps the authority of both Congress and the courts. The Constitution grants to Congress alone the authority to determine patent policy by enacting patent laws. And the authority to interpret those patent laws is “emphatically the province and duty of the judicial department.” Loper Bright Enterprises v. Raimondo, ___U.S. ___, ___ S.Ct. ___ (June 28, 2024), overruling Chevron deference and citing Marbury v. Madison, 1 Cranch 137, 177 (1803). The Supreme Court has used its authority to confirm that Congress is the only branch of government entitled to determine the “limited Time” of exclusive rights granted to inventors and authors under Article I, Section 8 of the Constitution. Eldred v. Ashcroft, 537 U.S. 186, 199 (2003)
Wishful Thinking
The proposed rule changes seek to make it easier to challenge drug-related ‘patent thickets’ created by multiple continuing applications by preemptive use of lower-cost post-grant challenges to the validity of just a single claim in a single patent in a patent thicket. The USPTO naively assumes that imposing a concession of ‘lose-one-claim, lose-all-patents’ by way of terminal disclaimer language requirements might make it easier to realize freedom-to-operate for generic drug competitors, and this might magically result in decreased drug prices.
There are so many problems with the USPTO’s wishful thinking. First, the preemptive use of post-grant challenges to obtain freedom-to-operate is rarely if ever realized. Attempting a preemptive challenge to invalidate a patent in a review proceeding carries many more risks than rewards. Second, the patent thicket threat involves sequential lawsuits filed by a single assignee who holds multiple patents directed to the same invention. That threat is different than a true ‘patent double jeopardy’ threat underpinning judicial rationale for the common ownership requirement of the current terminal disclaimer rules. True patent double jeopardy requires lawsuits filed by multiple different assignees of patents directed to the same invention against the same defendant for the same act of infringement and that ended with the second lawsuit having an award of double dip damages. But this is only a theoretical concern wrongly relied upon by the courts to justify expanding the doctrine of double patenting into the fantasy realm of concerns about common ownership of patents directed to the same invention. Based on this ruse of purporting to prevent fictional patent double jeopardy, the proposed rule changes improperly constrain statutorily authorized continuing applications for all kinds of innovations, not just drugs.
Real Solutions
If the USPTO really wanted to address alleged concerns about drug-related patent thickets, it should focus on changing its procedural rules for examination. The dragon of drug-related patent thickets is largely a self-inflicted wound, born from an overly broad interpretation of restriction practice that prioritizes managing examiner workloads over rigorous examination. Given that multiple continuing applications are self-selected as being of greater importance, enhanced examination, not easier examination, is a better way to handle these larger patent families. See, Freilich, J. et al. (2024). “A New Approach to Patent Reform,” UC Irvine Law Review, 14(2). Instead of resorting to a draconian concession from patent applicants that will negatively impact all kinds of innovations, the USPTO should tighten restriction practices and enhance examination of continuation applications. It must leave for Congress the policy decisions on how best to address ‘patent thickets’ for drug-related inventions.
Read More
The full paper lays out why the proposed rulemaking for terminal disclaimers is both ill-conceived and impermissible. Part 1 examines the evolution of double patenting under the first-to-invent patent system before the America Invents Act of 2011 (“AIA”), highlighting how the USPTO’s proposed ‘lose-one-claim, lose-all-patents’ double patenting concession conflicts with statutes, case law, regulation and guidance for the pre-AIA era. Part 1 then lays out why the changes to what is and is not prior art and the elimination of interferences in the first-inventor-to-file patent system of the AIA did away with double patenting. Part 2 presents the legal reasons not to adopt the proposed rule changes and examines why the policy reasons presented in both in the Patent Office notice and Professor Lemley’s paper in favor of the proposed rule changes are flawed. It then offers recommendations on how to improve examination of continuing applications with more targeted approaches and without resorting to the blunt weapon of imposing a ‘lose-one-claim, lose-all-patents’ penalty on all the patents in a patent family. Part 2 concludes with practical suggestions for how practitioners and patent applicants might respond should the USPTO go forward with this misguided fairytale of changing the rules for terminal disclaimer practice to overcome double patenting.
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Author: iqoncept
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