Patent Truth and Consequence: File First Even in the U.S.

Most who are even casually familiar with patent law and patent practice understand that it is far better to file a patent application sooner rather than later.  There are many reasons to file sooner rather than later, perhaps chief among them is to prevent the so-called statutory bar of 35 U.S.C. 102(b) from preventing a patent from issuing.  Perhaps the most common statutory bar situation arises when a product that is the embodiment of an invention is publicly used or on sale in the United States more than 12 months prior to a US patent application being filed.  In order to prevent a statutory bar an application needs to be filed promptly, but the 12 month grace period can lull inventors into a false sense of security. What so many inventors don’t realize is that third-party activity can start the 102(b) clock ticking. So many inventors think what they have invented is so unique that no one else could ever have come up with it, thus there is nothing to worry. This logic ignores the reality that creative people do frequently engage in the same inventive activities.

The most important reason to file sooner rather than later is to obtain an earlier priority date so that the work of others will not be considered prior art.  But what happens if two or more applications filed by different inventors define the same invention?  Throughout the world the answer is simple – the first party to file the patent application is entitled to the rights, provided of course that the invention meets the patentability requirements.  In the United States, however, the rule is much more complicated.  The United States is what is called a “first to invent” system, meaning that the patent, if one ultimately issues, goes to the party who invented first, even if that part was not the first party to file the patent application.  The caveat, and it is a big caveat, is that you must be able to offer proof that you were the first to event, which is not nearly as easy as most believe it to be.

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There has been debate over the years regarding whether the United States should become a first to file system, thereby rewarding the party winning the race to the Patent Office. In fact, today we are closer to adopting a first to file system than we have been at any point in time.  Notwithstanding, for now you do not need to win the race to the Patent Office in the United States in order to obtain a patent.  Nevertheless, it is still extremely important to file as soon as possible.  All things being equal, you would rather be the first to file. All of the evidentiary benefits and inferences are placed in favor of the individual or entity that files first. No one should aspire to filing second.

It is not unheard of to have multiple applications claim the same invention, but far less than 1% of all applications fall into this category.  It is equally important to realize that a patent can only be granted once, and only to one inventor (or inventive entity in the event there are co-inventors).  Unlike copyright law, patent law does not allow for independent creation to result in a shared exclusive right.  Patent law does not authorize the provision of multiple rights on the same invention, so there can only be one patent per invention.

A proceeding called an “interference” is the process employed by the Patent Office to determine who obtains a patent in the event there is more than one application covering the same invention.  An interference proceeding can be instituted to determine priority of invention between a pending application and one or more pending applications and/or one or more unexpired patents.  The Patent Office, however, does not have jurisdiction to conduct interferences which involve only patents, i.e., which do not involve at least one pending application. Jurisdiction over those proceedings is conferred to the Federal courts by 35 U.S.C. § 291.

Before proposing an interference, the examiner must be certain that each of the applications in question do in fact contain a claim to the same patentable invention and that each of those claims is clearly readable upon the disclosure of that party and allowable in its application. If the applications each contain at least one claim drawn to the same patentable invention, the examiner proceeds to propose the interference.  This typically happens not because multiple applications identically claim the same invention, but because multiple applications disclose the same invention in the specification.  Because of the way the Patent Office handles workflow, it is all but certain that the same examiner will wind up with both applications.  The examiner can encourage the two applicants to add a claim to their applications, a claim that would be identical for both applications.  If the parties do copy the suggested claim then low and behold you have multiple applications that now claim the same invention and a search ensues to see who was the first to invent.

In the event the examiner does not declare an interference, one may be provoked. First, an interference may be provoked between pending applications by request from an applicant who has become aware of another application which may be claiming the same invention.  Second, an interference between a pending application and a patent can be provoked by the applicant by copying the claim in an issued patent or published patent application and making the argument that they are entitled to the claim.

Regardless of how the interference has begun, the terms “conception of the invention” and “reduction to practice” are encountered in connection with priority questions. Conception of the invention consists of the complete performance of the mental part of the inventive activity. The conception of an invention is the formation in the mind of the inventor of a definite and permanent idea of the complete and operative invention as it is thereafter to be applied in practice.  The date of this conception is the date when the inventor’s idea has crystallized in all of its essential attributes and becomes so clearly defined in the mind of the inventor as to be capable of being converted to reality and reduced to practice by the inventor or by one skilled in the art. For there to be conception of invention the inventors definite and permanent idea must include every feature or limitation of the claimed invention.

The date of invention relates to your conception. This is true whether you are engaging in an interference proceeding seeking to obtain a claim instead of another who is also seeking the claim, or you are attempting to demonstrate that you can get behind a reference used by an examiner because you have an earlier date of invention. The hallmark of a first to invent system is that those who file second can obtain a patent under very strictly limited scenarios. A byproduct of a first to invent system is that if the examiner finds prior art you can “swear behind” the reference using a 131 affidavit to demonstrate that reference is not prior art for your invention. In both the interference context and the 131 affidavit context there needs to be proof of conception that will satisfy the patent laws.

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Reduction to practice can be actual or constructive.  Actual reduction to practice refers to the construction of the invention in physical form, or the successful completion of a process. Proof of actual reduction to practice requires a showing that the invention actually worked for its intended purpose.  Constructive reduction to practice refers to the filing of a regular patent application completely disclosing the invention, which is treated as equivalent to actual reduction to practice.  Constructive reduction to practice is a term of art that refers to the preparation of a patent application. If a the description of the invention in a patent application is sufficiently definite enough to allow one skilled in the art to make the invention, the invention will be considered to be constructively reduced to practice, even if no working model or prototype exists.

The priority question presented by an interference proceeding is determined by the Board of Patent Appeals and Interferences, which is typically a board of three administrative patent judges. The Board will decide who is entitled to the patent based on the evidence submitted. 35 USC § 135(a) also grants the Board discretion to determine questions of patentability during the proceeding. After resolution by the Board the losing party may appeal to the Court of Appeals for the Federal Circuit or file a civil action against the winning party in the appropriate United States district court.

The law requires each party to an interference proceeding to submit evidence of facts proving when the invention was made. In reality, what happens normally is that the party claiming to be the first to invent, and who was the second to file, must in the first instance demonstrate that they can prove a date of invention (i.e., conception) prior to the filing date of the party who was the first to file.  In legal terms the party who is the first to file is called the “senior party” and the party who was the second to file is called the “junior party.”  All inferences go to the senior party because public policy favors the early disclosure of inventions.  So the senior party does not need to show anything, and can simply stand on their filing date, unless and until the junior party is first able to at least beat the senior party’s filing date.

Assuming that the junior party can indeed demonstrate invention prior to the senior party’s filing date, the game is on and the Board of Patent Appeals and Interferences will determine who was the first to invent.  Nevertheless, in the event there is a tie, meaning the parties invented at the same time, or more likely that the evidence demonstrates a tie, the senior party wins.  Much like the rule in baseball that the tie goes to the runner, the tie in an interference goes to the senior party, so the deck is indeed stacked against the junior party from the outset – yet another good reason to file an application as early as possible.

But how could there ever be a tie in terms of when multiple parties invent?  Indeed an actual tie would be rare, but sometimes invention records are not altogether clear, or perhaps even non-existent.  In at least one case the evidence demonstrated that the junior party in all likelihood beat the senior party, but their evidence could only specify that they invented during the last week of October.  The senior party had concrete evidence that they invented on October 31.  The Federal Circuit said that an invention during the last week of October could mean that it occurred as late as October 31, and because that was the date the senior party could prove the senior party was victorious.

In view of the necessity of proving the various facts and circumstances concerning the making of the invention during an interference, inventors must be able to produce evidence to demonstrate when they conceived of the invention and when it was reduced to practice. If no evidence is submitted, a party is restricted to the date of filing the application as his/her earliest date of invention.  Therefore, it is absolutely critical to keep detailed, understandable and accurate invention records.  It is also critical to have the invention records verified by someone competent to understand the invention.  Such verification is necessary because if one thing is clear throughout patent law it is that the testimony of inventors is not credible.  Absent corroboration inventor testimony will be treated as inherently unreliable.  Harsh yes, but that is the rule, so it is essential to have in place a regime that requires inventors to document their work in a meaningful, understandable manner, and to have authentication of the invention records.

It is also critical to understand that even if the evidence exists to demonstrate that the junior party conceived first they may still not prevail. This is because in order to prevail the junior party must demonstrate that they diligently worked on the invention from at least before the conception of the senior party straight through and uninterrupted to the date of their reduction to practice. This diligence cannot be interrupted. In fact, if the junior party was not continuously diligent there are virtually no excuses that will allow the junior part to prevail. Stopping to take a vacation is an interruption in diligence. Waiting for your patent attorney who is at trial to get done to prepare and file the patent application is an interruption in diligence. Stopping active work on the invention to raise funds from investors is a break in diligence. The diligence requirement is quite unforgiving.

The take-home lesson here is that the deck is stacked against those who are second to file and claiming they were the first to invent.  In fact, since October 1, 2004, only 1 independent inventor has managed to prevail in an interference proceeding.  Thus, inventors do nothing to help themselves when they believe the U.S. is a first to invent system.  Yes, we are a first to invent system but the evidence required is quite onerous and it is necessary to demonstrate that as you proceeded from conception to reduction to practice you were diligent.  That means no breaks in working on the invention. Does your notebook demonstrate conception? Has it been verified by an independent third-party who understands your invention? Have you worked on the invention continuously? Proving you are the first to invent is exceptionally difficult.

It is better to say that the U.S. is a kinda-sorta a first to invent system.  If you have the required evidence and the facts are on your side you might prevail.  Of course, to have any realistic chance to prevail you will need competent legal representation and that on average will run you about $600,000.  So the first to invent system is really hardly inventor friendly, or even small business friendly.

First to invent seems simplistic and easy to understand, but it is not. Inventors think they know what it means, so they are lulled into making bad strategic decisions based on incomplete understanding of what the law requires and what first to invent actually means. Moving to a first to file system will be far more easy to understand, it will provoke inventors to do what they already should be doing (which is file as soon as possible) and it will ultimately provide enormous strategic advantage to independent inventors and small business because large corporations will be slow to adapt to any changes in the law, but nimble and reactive inventors and small businesses will modify behavior immediately.  I predict that large corporations will regret the day they supported first to file, so inventors and small businesses should see this as a great opportunity rather than a terrible curse.

And for those who say they cannot file patent applications quickly enough or cheaply enough if we move to a first to file system, they are not being straight forward and honest with you. In order to prevail in a first to invent system you need proof of conception. If you have written proof of conception then you have something in writing that will be useful to prevail in an interference and which would be useful to help support a legitimate 131 affidavit. If you have such proof of conception you also have an adequate written disclosure that will support priority. So just take those notes you would like to rely on later in an interference proceeding or for a 131 affidavit and attach a provisional patent coversheet, pay the $110 to the Patent Office and file a provisional patent application. You get immediate patent pending and you lock in your priority date. It really is that simple.