Point – Counterpoint: The Debate Over Prior User Rights

Since prior user rights first came up as an issue in the patent reform debate I have been opposed to the idea.  Whether I like prior user rights or not, the reality is that prior user rights are now a part of U.S. patent law.  Nevertheless, the debate goes on about whether prior user rights are a good idea.  In fact, the United States Patent and Trademark Office is tasked through the America Invents Act with conducting a Prior User Rights Study.  To facilitate this study a public hearing on prior user rights was held on October 25 in the Madison Auditorium at its Alexandria, Virginia campus of the USPTO.

With this in mind I thought I would once again revisit prior user rights. One of the arguments I have heard recently supporting prior user rights is that a corporation that is going to invest billions of dollars into a facility should know that their investment is safe and that the plant can’t be shut down by a later filed patent application.  This argument is so specious as to be nearly laughable if you ask me.  This strikes me as just more of corporate America wanting the government to save them from themselves.

Exactly who is to blame if a pharmaceutical company, say Eli Lilly, decides to invest billions of dollars and build a facility when they haven’t adequately protected their own intellectual property?  Moreover, who is to blame if that company consciously chooses to resort to trade secret protection, which we all know is exceptionally fragile, as the foundation to build a multi-billion dollar investment?  For crying out loud, the very premise that a patentee could force the closure of a manufacturing facility employing hundreds or thousands of people and interrupt the production and distribution of anything, let alone something as consequential as a pharmaceutical, is nothing more than fantasy.  Talk about chicken little!  Only someone unfamiliar with the evolution of the law relative to preliminary and permanent injunctions in patent litigation could with a straight face much such an argument.  Indeed, the mother of all straw arguments!

Given that so many intimately involved in patent reform seem to have a vested interest in touting the America Invents Act as brilliantly written and a magnificent piece of legislation that will only simplify the patent process, where can you go for a legitimate debate of the pros and cons of something like prior user rights?  We have to look abroad where folks have had real experience with prior user rights.

To jump start a fresh discussion of prior user rights I reached out to Justin Simpson, an Australian patent attorney and founder of Inovia — one of our sponsoring companies that has developed a foreign filing platform designed to streamline the PCT national stage and European validation processes.  Given Inovia’s global footprint I figured it would be quite useful to get Simpson’s international perspective, particularly given that prior user rights have never be utilized in the United States but are commonplace overseas.


While I don’t want to rehash my writings on prior user rights, it is worth noting that until the enactment of the America Invents Act the United States did not really have any experience with prior user rights.  It is true, of course, that prior user rights have been available as a defense to patent infringement with respect to business method patents since 1999, but there has never been a single case where the defense was raised, so this is very much a brave new world for the United States.

It is also worth noting, at least generally, the nature of prior user rights.  In a world without prior user rights one can obtain a patent and then enforce that patent against others who are engaging in infringing activity even if they were practicing the invention before it was patented.  The “prior user” could be ordered to stop what becomes infringing activity after a patent issues, which strikes some as unfair.  The question arises: Why did the Patent Office issue a patent if someone was already using the invention?  This entire issue comes to the forefront if and only if the prior use were secret, thus meaning that the prior user was not prior art to the patent application filed.  So whenever we talk about a prior user rights regime we are discussing a defense to patent infringement that is given to a secret user who defeats the rights granted to the patentee.

Simpson explained the logic behind prior user rights:

From a first-to-file country point of view, prior user rights are perfectly normal. The logic is this: if I have been making/using some technology and someone else files a patent application for it after I have been doing so, why should I be stopped from continuing to use that technology?

It is, in effect, very similar to the first-to-invent position of the (now old) U.S. law. If I invented something first, and have been using it, I shouldn’t be punished if someone else files a patent application later for that same invention (that they have come up with independently).

At first glance it is hard not to like the simplicity and seeming fairness of a prior user rights regime, and Simpson certainly captures the essence of argument in favor of prior user rights and the prevailing international viewpoint.  If someone else invented something first then why shouldn’t they be allowed to keep using the invention?  In my mind, however, it all boils down to whether you want to encourage disclosure or whether you want to tolerate secrets potentially inhibiting the march of innovation.  A prior user rights regime rewards those who hide innovation and keep it for themselves, which is antithetical to the purpose of the U.S. patent system as it has always been rationalized.

The fundamental purpose of the U.S. patent system has always been to foster disclosure, and that purpose is grounded within the U.S. Constitution.  We tolerate the creation of exclusive rights in order to obtain disclosure that others can rely upon and build upon.  Simply stated, you cannot stand on the shoulders of those who come before you if what they did was kept secret.  Thus, a prior user rights system perverts the traditional rationale for the U.S. patent system as embedded in the U.S. Constitution and as understood and articulated by none other than Thomas Jefferson and James Madison.  This being the case, I don’t know that the international experience with prior user rights can or should inform the United States on the issue. For more see The Constitutional Argument Against Prior User Rights.

Simpson acknowledges my argument that prior user rights provisions reward those who hide innovation, but doesn’t find this to be persuasive.  Simpson explained:

It is partially true that prior user rights rewards hidden innovation because it does protect those innovators from being successfully sued by parties who come up with the same invention later. But it does not allow them to stop any other parties from copying the invention.

There is no doubt that Simpson is correct.  Prior user rights is a defense, not an offense, and affords no exclusive rights.  Thus, it can be argued that patenting innovation for the exclusive rights will still remain highly attractive.

Simpson also argues that innovators will still want patents.  He explains:

Truly innovative companies will still want to patent their innovations because: (1) they will be able to stop their competitors from copying them; and (2) they won’t be content to simply let their innovations be “frozen in time” by relying on the prior use defense to allow them to keep doing what they’ve always done.

Remember, if the later-filed patent application protects further (new) inventions/aspects, the company that invented and used the invention first cannot adopt those additional advances. They can only keep doing what they were doing before the patent filing date.

Certainly innovative companies will, but what about the behemoths of the tech industry? I question whether large corporations will continue to seek patents, or at least whether they will seek patents in the same quantities. Not only would a decrease in patenting activity slow the march of innovation, but it could present unintended negative consequences for the funding of the USPTO, which relies on ever increasing levels of applications and fees to fund the Office moving forward.

Will large corporations still seek patents and disclose incremental innovation given the global corporate world we live in today? I can’t help but notice that the largest companies are larger in economic terms than many countries.  Is this what it was like at the turn of the 20th century when President Theodore Roosevelt was famously trust busting?  In such a corporate environment do exclusive rights play the same incentivizing role?  I doubt it.  When through size alone one can push around the competition why do you need exclusive rights?  I, and many others, worry that the emergence of prior user rights in the U.S. will drive innovation underground, which would clearly frustrate the fundamental purpose of a patent system.

There are plenty of reasons, as Simpson indicates, for not relying on prior user rights and seeking the exclusive protection a patent can offer.  But what will be the impact on incremental innovation and how many start-up companies will be ruined because they invested everything to disclose and protect but then couldn’t enforce against the one competitor that mattered?

Still further, it seems quite clear that a prior user rights regime does not jive with the underlying principles that have always supported the U.S. patent system, including from a Constitutional perspective.  Will this give those in the anti-patent community a new opening to challenge the entire foundation, logic and need for a patent system?  If infringement can be excused in the case of a prior use then surely it would have to be excused in the case of real societal need, right?  And therein lies the slippery slope.  I know slippery slope arguments are often overblown, but can you really say that given the anti-patent community challenging gene patents, the media embracing the ACLU position that patents are evil and the Supreme Court refusing to allow permanent injunctions as a matter of right and requiring the 4 part balancing test that requires consideration of the public good?

Time will tell what the ultimate verdict is on prior user rights, and I hope Simpson is right. As a small “c” conservative I am against change for the sake of change and without any reason.  While a logical argument can be made to support prior user rights a logical argument can also be made against prior user rights.  I also don’t see that type of factual findings that would support a departure from the underpinnings of U.S. patent law, and openly question whether the inclusion of prior user rights was merely to benefit certain corporations who lobbied heavily.


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Join the Discussion

52 comments so far.

  • [Avatar for Anon]
    November 4, 2011 10:30 am

    American Cowboy,

    I do not think that going back to first to invent will happen. There is too large an impetus to tackle that avenue.

    I am hoping for a workable solution that can be made by the USPTO to Congress in its January report that Congress can pass in a technical amendment. Too big of a bite will choke the fix.

    I should further note that my offered solution would deal with the current problematic ability of a Third Party exhausting the rights of a First Party wherein that First Party receives none of the benefits of the exhausting sale. I did not address this above as the incongruity of a “personal reward/public still impacted” schema is a more prominent legal issue.

  • [Avatar for American Cowboy]
    American Cowboy
    November 4, 2011 10:20 am

    Fix the statute; great idea!

    Let’s go back to first to invent, then we don’t need the PUR monster.

  • [Avatar for Anon]
    November 4, 2011 07:58 am

    Let’s get back to possible solutions if we can.

    I think a prudent goal is two-fold.

    The first is to clearly point out the infirmity with the law as it is currently written. An objective view shows that the secrecy issue and the taking issue raise serious doubts as to the legitimacy of this portion of law.

    The second is to rectify the law and still provide the intent of protecting those that truly practice “an invention” that is granted a patent after the actual practice of that “invention.” If indeed Goliath did practice the invention before David filed, then not only Goliath, but the public as a whole is harmed by the patent. I simply cannot see the logic of a “personal defense,” and I have not seen any arguments as to why something in the public should be so constrained. The very act of one company selling anything must involve the public because it is the public that buys that anything. They are the two sides of the single coin.

    I think that recognizing (and rewarding) a personal secret use is the source of the problem. I think that not tying this directly to the validity of the later grant of patent is also an insoluable proposition (the two are inextricably linked). A viable law, at least in the US, cannot separate the two.

    Are there other suggestions addressing this problem? Other suggestions like the one I posted at 43? I think that the Office should take an active lead in synthesizing workable solutions and incorporating these into its report to Congress, rather than rubber stamping the more vocal views of special interests, which were shown by the panel chosen to speak at the public hearing on this topic. It is in everyone’s interest to recognize the unworkable nature of the current law and fix it now, rather than wait a number of years for the courts to declare what is obvious.

  • [Avatar for step back]
    step back
    November 4, 2011 06:55 am


    Well said.

    The thing that bugs me about PUR is that it is all done under the cloak of secrecy.

    That sort of begs for all sorts of unscrupulous conjuring up of after-the-fact evidence (while still under the cloak of secrecy) to show that the PUR-user commercially used “the subject matter” more than 1 year before the effective date of the claim.

    Inherently that means that records alleged to be 4 years or much older (figure 14 years as a good estimate) will be used and the people who can be deposed as to chain of custody will often be conveniently unreachable after they leave employment of the PUR-user. (The 4 year minimum number comes from assuming 3 years to issue plus the 1 year before effective filing date. Often, law suits come 10 years after issue date.)

    It has been shown time and again that when an invention turns out to be really commercially valuable, all manner of on-the-witness stand “I swear” people show up to claim they did it first.

    IIRC, someone upthread mentioned the barbed wire cases. The fights between Alexander Graham Bell and Elisha Gray come to mind as a second example, Townsend v. Gould (the laser) as a third example and I’m sure others here can point out yet more examples –i.e. that more recent Flower Nursery case at the CAFC (I forget its exact name).

    The main point is that the secrecy of PUR invites for all manner of perjury even beyond what already takes place under the old patent system.

    On the other side of the coin (and pf the titled battle field), the patent applicant is forced to transparently show his hand in an absolutely verifiable way when he files with the USPTO (i.e. there is no room for even one shred of “new” matter). And then it appears that the burden of proving the PUR claimant to be a perjurer unfairly falls squarely on the shoulders of the one (the patentee) who was the one operating out in the sunlight rather than under the cloak of darkness. This is really unfair. Or so it seems to me. Am I wrong?

  • [Avatar for Blind Dogma]
    Blind Dogma
    November 3, 2011 10:35 am

    IF David actually invents something first, then he will get a wonderful patent, just like Goliath would, and if one gets a patent then he can run around and fire his slingshot at everyone to his hearts content

    You do quite miss the point of all this. I do notice that you never did answer Anon’s questions.

    The VALUE of a patent takes a huge hit given the UNCERTAINTY that Prior User Rights introduce.

    Prior User Rights will not be UNCOVERED until a patent holder, who has dutifully gone through the process and has acheived a patent (not the IF in your rebuttal), will – only upon attempting to enforce what the patentee had been led to believe were true exclusive rights – be surprised by a SECRET holder who has not bothered to share that secret until forced to.

    So no – the David’s of the REAL world, will not be able to do AS THEY RIGHTFULLY EXPECTED and be able to use a patent for the only thing a patent is good for – to exclude – because some Goliath can pull out his secret use and thumb his nose and the patent holder.

    And yes, it is evident that you do not understand this “technological progress is unrelated in its scope and speed to the patent system at all – in effect already blanking out it of existence” because you quite evidently do not get that HAVING a patent system actually does work in PROMOTING innovation. You think that innovation will be PROMOTED just fine with a weakened patent system – and extrapolating – to a system without patents at all. As I said, the stench of left-wing academia hangs all about you.

    As for real world expeerieince – -it is not a matter of “Goliath-real-world-experience” or even of “David-real-world-experience,” but of practiacl REAL world experience – academics, especially IP academics do seem to have a shortage of what is REAL in their sense of REALity.

  • [Avatar for step back]
    step back
    November 3, 2011 06:22 am


    Read what you may out of your fantasy version of the US Constitution.
    Here is what one of the enumerated empowerment clauses of the real one says:

    To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

    It doesn’t say Inventions.
    It says Discoveries.

    A dis-covery is the same as an un-covering or a dis-closure (taking it out of the closet).

    Exclusive means exclusive, not shared with coverers and hide-in-the-closters.

    Unfortunately we will have to wait until someone takes their case all the way up to the US Supreme Court and until Justice Scalia finds his originalist’s dictionary before the PUR part of the AIA can be found unconstitutional.

    Until that day, God help us and God help all those unleashed inventors in North Korea who are flourishing under that country’s no-patents, let-Goliath rule system.

  • [Avatar for ceej@y]
    [email protected]
    November 3, 2011 02:41 am

    Sorry to cause you so much pain. My last sentence was poor. My bad. I’ll just need to find a slingshot and shoot at your Goliath-real-world-experience.

    I don’t doubt that many Davids will have their heads dashed against rocks, but you’re wrong to say that I offer David no protection. You’re saying that it’s unequal protection b/c it was already unequal. I don’t read anywhere in the Constitution that Congress is authorized to use the IP Clause to redistribute wealth and equalize market power. IF David actually invents something first, then he will get a wonderful patent, just like Goliath would, and if one gets a patent then he can run around and fire his slingshot at everyone to his hearts content. Do you really think that technological progress will slow dramatically? We will still value inventors that produce information and products. It will still be a race.

    I don’t really understand this: “technological progress is unrelated in its scope and speed to the patent system at all – in effect already blanking out it of existence.”

  • [Avatar for Blind Dogma]
    Blind Dogma
    November 2, 2011 01:45 pm

    [email protected],

    My recommendation: get out into the real world.

    Your ivory tower perspective is painful to read.

    You think taking David’s slingshot is “forcing” David to avoid Goliath and obtain a broader set of technological advances – with absolutely no thought given tot he very real possibility that David may not be able to do so, as step back puts it, David has had his head removed by your ideal of “competition.”

    You offer David no protection from Goliath and even if David did happen to escape the Octogon and decide to “invent” something else, there is nothing to protect David from Goliatha coming after him and taking his new toys.

    In essence, your “parenting skills,” if these two were your children, would be to scold the child being picked on (David) and tell him to play somewhere else, and helping move David’s toys into Goliath’s room.

    You also make a blanket (and unwaranted) assumption that “The public is still going to get the benefit of the technological progress” completely missing the fact that a patent system rigged for the behemoth (and the little guy unable to play or – smartly – refusing to play) is far inferior to the patent system that promotes (and protects) the little guy so that the market power of the big guy is neutralized and even the big guy must innovate rather than rely on Secrecy and raw power. You ignore the maket failures inherent in your ideal. You ASSUME that technological progress is unrelated in its scope and speed to the patent system at all – in effect already blanking out it of existence.

    Your last sentence is completely unintelligible, but it almost sounds as if you are saying that you value the ability of the individual to run amuck completely unencumbered by any patent rules. The stench of left-wing academia hangs all about you.

  • [Avatar for ceej@y]
    [email protected]
    November 2, 2011 01:13 pm

    By forcing David to avoid Goliath to avoid each other, the public benefits from a broader set a technological advances. The public is still going to get the benefit of the technological progress. Personal liberty is a pretty good default rule when policy debates rage, and yes that includes the freedom to retain a competitive advantage by which ever civil power-mechanism you see fit.

  • [Avatar for American Cowboy]
    American Cowboy
    November 2, 2011 10:09 am

    Anon raises the topic of having companies pay attention to newly issued and published patents and applications. I think that is a topic worth further illumination. Back when it was easy to find wilfull infringement, the word on the street was that Patent Counsel were telling their engineers not to look at patents, for fear that they would later be found to be wilfull infringers if found to infringe a patent that they knw about and did not get competent counsel to opine about. That imperative has been weakened by making it harder to find wilfull infringement.

    In addition, the AIA statute also calls for greater third-party opportunities to cite prior art against pending published applications and one of the new post-grant opposition procedures is only applicable for a year or so after issuance. So it seems that actually monitoring published and newly-issued patents wil become more common in the AIA world.

    I think that is a change for the better, but who knows.

  • [Avatar for Anon]
    November 2, 2011 09:05 am

    Perhaps if we made the defense not a personal defense and made it part of the past-grant process.

    I am thinking of switching the defense to a an offense. Instead of waiting to be sued for infringement (and thus potentially free-riding on the patent holder’s market development), why don’t we make the use of the defense contingent on evidence made of record during the post-grant review period? If you later want to use the defene, you must only depend on the record provided during that post grant review window. Thus a “true,” (at least more certain) patent right woud emerge from the process, on e in which both the patent holder and the public at large could depened upon.

    One complaint I can think of is that people might say that they would trhen be forced to pay attention to the patents being issued in their particualr art area. My response would be, Isn’t this what we want anyway? Do we not want people to pay attention to the “Quo” being provided? In fact, this seems like an additional Win to me.

  • [Avatar for step back]
    step back
    November 2, 2011 06:18 am

    – the fact that some “item” can be protected under the domain of patents –


    It’s not so much about ‘items’ as it is about people and placing them in an ordered line up to determine whose interests will be superior to the others.

    Under the old patent law it was like this:
    1. The general public and their welfare
    2. The inventor who builds and discloses, including best mode
    3. The secreter who conceals stuff for his own selfish gains
    4. The perjurer who creates phony evidence for his own selfish gains

    Under the new patent law (Anti-Invention Act of 2011) the line up is like this:
    1. The secreter who conceals stuff for his own selfish gains
    2. The perjurer who creates phony evidence for his own selfish gains
    3, The inventor who is fastest with the paper work, even if he conceals best mode
    4, The general public and their welfare

    I liked your imagery about the UFC fight cage, although I’m not sure that all who read this understand what it means or care that David ends up on the floor with his head removed by the brawnier Goliath instead of the other way around.

  • [Avatar for Blind Dogma]
    Blind Dogma
    November 1, 2011 06:25 pm

    You seem to be saying something about public ownership and the prior user defense.

    Yes, that is exactly what Anon is discussing.

    First to File (or First Inventor to File) is dragging along the notion of Prior User Rights – that is the topic of this thread. Did you not notice the topic of the thread? What then are you discussing? How would Prior User Rights actually fit into your conversation? And if you are discussing Prior User Rights, then there is some serious disconnect with your position and how the law works (both before and after AIA). Let me guess, you are one of those academics who saw the chance to redefine the patent system and jumped in with your theories without looking at how deep the water of reality is. You’ve jumped from quite a height from your ivory tower and should have noticed that you jumped into the “shallow end.” (not to be confused with shallowness of position – that too belogs to you and your “theories.”

    Let me throw out some of my observations on your observations.

    1) It is not material that the particular patent in the case was held invalid. What is material is the legal logic at play – the fact that some “item” can be protected under the domain of patents – with that system’s sharing of knowledge and eventual ownership by all versus the domain of Trade Secrets – with that system’s express non-sharing of knowledge and (theoretical) perpetual ownership by a private entity. These domains do co-exist and the interplay between the two and the “on-sale” bar – both for the entity possessing the Trade Secret, as well as an entity who does not know of another with the Trade Secret, who independently invents the subject of the Trade Secret, who goes to the trouble and expense of patenting that subject with the expectations of a certain payback, and then – and only then – while dutifully enforcing their patent right, who are surprised by a Trade Secret holder with the Defense of Prior User Rights. The instrinsic VALUE of the patent is, or can be, surprisingly devastated – after the fact, and with the possibility of NO advance warning.

    Contrast the one entity who was willing to share the information with all against the entity that was willing to share with no one.

    2) The provision is not as much as two separate parties competing as you would indicate, and is much more about the differences between those two parties. Not only as I have indicated in 1) here with the difference in share/secret, but also, there is a fundamental difference in competition (and cost outlays) . The entity willing to share must put out the cost to obtain and then enforce the patent. The entity willing to keep things secret is a free-rider on the efforts of that entity putting out the money to obtain and enforce. Your “duopoly” is not one where the parties are competing equally. In addition to an escape from liability directly to the information-sharing patent holder, the secret-holding entity has carte blanche power in respect to its customers. With NO just reward to the patent holder, a secret-holding entity’s sales EXHAUST the patent rights of the true patent holder. The patent holder is left holding the bag while the secret-holding entity pockets the entire amount of the sale. Also consider the detrimental affec tot he expected value when after going through the pain, time, and money to obtain a patent, when upon enforcement you learn that a competitor not only does not have to take a license from you, but that that competitor (assume for the moment that that competitor is a large international behemoth – not a dificult assumption given that is exactly the types of firms pushing for Prior User Rights – bu that that competitor can bury any type of licensing program to the now nonexclusive market. A duopoly you suggest? Reality is not as you would portray. Your duopoly would be like having David fight Golliath, except you strip David of his slingshot and force both ot them in an Octogon, remove the ref and say: Compete! (see isn’t that a good thing?) You quite miss the point of the VALUE of the patent system as an equalizer and source of truely unique competition. You ignore the market size effect that the large international behemoths would quite frankly love for you to ignore in their misleading “baa-ing” about how unfair patenting is to those who do not want to join in on the patent system or those who cannot afford to join in the patent system “because there are too many items” to patent – both of which are patently false arguments, as a mere public disclosure would defeat any other entity from patenting those “too many” ideas. Such a public disclosure can be effected at virtually no cost. It is not an even playing ground that these Behemoths crying for Prior User Rights want – it is the ability – without any patent threat – to operate in a Guild-like, nonsharing Trade Secret environment, with the added benefit of free-riding anyone who would dare try to patent something, with that entity footing the bill up to and inclulding enforcement of what is believed to be a very real and valuable property right and then being shocked with a bronx cheer and thank you for keeping out any other competitors, don’t mind me as I steal all the customers with my ability to undersell you, and oh by the way, I have just exhausted your patent rights with my sale.

    Not sure I can understand the real equity going on with this new law – do you?

  • [Avatar for patent enforcement]
    patent enforcement
    November 1, 2011 02:01 pm

    Wow, is there really someone out there who believes that the patent reform act is a “brilliantly written and a magnificent piece of legislation”? If so, that person needs to get out more.

  • [Avatar for ceej@y]
    [email protected]
    November 1, 2011 01:30 pm

    I will try to consider those 3 items:

    1. Does ARMS v. Troy really show us a coexistence of TS and patent? Considering the patent was invalidated, I’m not so sure I would agree with that characterization.

    2. This provision gives two separate parties the ability to compete: a duopoly for a limited time, until the invention is dedicated to the public domain. I’m not sure that it could apply to one single party.

    3. I wasn’t talking about a defense, I’m talking about 102 patent entitlement. If an invention is “on sale” then an inventor’s entitlement for a patent is immediately stripped away. There is no grace period.

    I’m not sure exactly what you’re proposing for the technical amendment. You seem to be saying something about public ownership and the prior user defense.

  • [Avatar for American Cowboy]
    American Cowboy
    November 1, 2011 09:42 am

    The language “patented, described in a printed publication, or in public use, on sale, or otherwise available to the public” scares the bejeezuz out of me. The Supremes and their beaten-down-serfs on the Fed. Circuit may make “otherwise available to the public” mean anything they want it to mean, including second-guessing from hindsight.

  • [Avatar for Anon]
    November 1, 2011 05:40 am

    [email protected],

    Three items to consider when formulating an answer to your excellent question (then isn’t that going to trigger the “on sale” bar immediately):

    1) Atlantic Research Marketing Systems (ARMS) v. Troy Industries
    ( http://www.cafc.uscourts.gov/images/stories/opinions-orders/11-1002-1003.pdf )
    Generall, Trade Secrets coexisiting with patented technology.

    2) The AIA’s new 35 U.S. 273(g): INVALIDITY.—A patent shall not be deemed to be invalid under section 102 or 103 solely because a defense is raised or established under this section.

    3) The item that pulls the trigger in question is something that may exist (and if the defense survives scrutiny, does exist prior to the patent grant), but the trigger itself is something that can only happen after patent grant – remember, we are talking about a “defense” that occurs only in the course of a patent holder seeking to enforce what he believes to be a solid patent (in most cases well after the grant of the patent). The sense of “immediately” in your question thus should be stricken.

    Indeed, item 2) is what sparks my comment above concerning an improvident grant of patent. (g) expressly introduces a contradiction. Should this in fact be restated in a technical amendment to be the opposite of what is today’s law? I would think so. The ability of the law (as written) to grant a personal pass on the basis of a “public” ownership is irreconcilable with the public’s right to practice that which is in the public domain. Remember too, that the 273 Defense must be proven by clear and convincing evidence – the level that should be able to extend the supporting facts to the public.

  • [Avatar for ceeja@y]
    [email protected]
    October 31, 2011 02:51 pm

    Does the language “patented, described in a printed publication, or in public use, on sale, or otherwise available to the public” really protect trade secret use? Maybe I missed some official interpretation of this language, but if you sell an secret invention, publicly or privately, then isn’t that going to trigger the “on sale” bar immediately per 102.a.1?

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    October 31, 2011 01:10 pm

    Gene, as noted, there is seems to be fundamental public policy problem with allowing a commercial trade secret user under the AIA to not just “have one’scake and eat it too” free of any infringement risk after one year AND ADDITIONALLY free of any personal bar to ALSO getting patent protection on one’s trade secret at any time later by interpreting all prior art and barsas limited to only public disclosures under new 102(a)(1). This was supposed to be a pro-patent patent statute, not a trade secret statute encouraging keeping inventions secret instead of patenting or otherwise publicly disclosing them until many years later to greatly extend total IPL protection by [allegedly] overuling even the equitable forfeture doctrine of Metallizing Engineering strongly supported on fundamental public policy grounds by both the Fed. Cir. and the Sup. Ct. The latter should be of far more concern than the former.

  • [Avatar for ceej@y]
    [email protected]
    October 30, 2011 08:37 pm

    @Anon–I probably have you beat on typos, so don’t sweat that.

    If we had a first-to-invent system, then I would more likely agree with you. But since first-to-file broadens risk for fast, first inventors can more easily lose all rights to their inventions. Nobody seems to be ok with that risk, which is why nearly all F2F countries also have recognized PUR. It isn’t because the countries hate competition, but it’s because they believe more or less in a prior-user right. The US hasn’t really endorsed this directly until recently, as the AIA is a step towards international harmonization. Does that mean I can waltz into court tomorrow and make moral-rightsy arguments in the CAFC next week? No way. But I think we are moving toward a more natural rightsy harmony, and that this will actually trigger greater amounts of competition and tech-progress. And don’t worry, there will still be winners and losers.

    If a prior user starts using an invention before a subsequent inventor files a patent application, then the winner is… (are) any and all prior users. They win because every human being has a natural right to use tangible and intellectual tools in commercial industry unless there is some statutory/policy-based exception. Patent law is such an exception to the natural law, and it happens to be included in Art.I, Sec. 8, albeit more ambiguously than some here are arguing. While patent rights are neither a natural nor a common-law right (Wheaton, 1834), patents rights are statutorily granted monopolies for potentially fantastic policy reasons. I don’t believe we should soon give-up on the theory that patent incentivize R&D through limited monopolies and disclosure. The goal cited in the Constitution is the promotion of “Progress.” (Short note on Constitutionality of PUR: the Constitution does not ‘require’ Congress to give absolute exclusivity to patent holders; it simply authorizes Congress to go that far in empowering an inventor.) The Constitution does not completely limit the incentives that can be used to promote this Progress, and courts have sometimes implicitly recognized a right to secret prior invention use which was superior to a patent right. (Dunlop Holdings, CAFC 1976).

    You argue that PUR is weak just because it’s not explicitly mentioned in the US Constitution. Why would the right to use previously unprotected intellectual tools be a major worry of the Founding Fathers? I’ve yet to read the Founding Fathers opinion on this, and I’ve read a good number of articles, Congressional testimony, and cases on the subject. The Constitutional Convention discussion on PUR has been described as “an absence.” On the other hand, I have read that patent rights are limited, as they are not even a property right under the Fifth amendment (CAFC 2006–Zoltek).

    Wouldn’t you say that requiring patent holders to compete with non-patent holders actually results in increased competitiveness? As was said in Dunlop Holdings, the commercialization of a product does “promote the Progress.” It’s not as if only disclosure of an invention 18 months after filing is the only way to get information passed around. (And what about patents that a submarine continuations?) In addition, I think the PUR policy is better because the outcome of some disputes have been made less harsh by PUR; the compromise is much more attractive for all participants, in the long-run. PUR actually encourages participants to engage in R&D in more diverse areas because PUR-induced duopoly isn’t quite as attractive as certain diverse-technology monopolies. And I think that the current PUR provision is good because it is cautious: it requires a high standard of proof of “commercial use” 1 year prior to a subsequent inventor’s patent action (“patent action” = public disclosure or filing in USPTO). The patent owners will still win a monopoly is many of the cases.

  • [Avatar for Anon]
    October 30, 2011 10:41 am

    Please excuse the typos – I hit the submit key too quickly.

  • [Avatar for Anon]
    October 30, 2011 10:39 am

    [email protected],

    While I will note that I share much of my colleague’ skepticism for the academic’s view of patents (those academics seem more intent on redefining the basic rules of the game), I am willing to take the inputs into consideration – to a point.

    That point is the conflation in nature between patents and copyrights. Patents simply are not and should notbe the same as copyrights. The two are distinct, and the conflation of the two should be avoided, in practice and in theory.

    As far as “taking rights away” please try to remember the distinction between inchoate rights and a property right that finds its roots in the Constitution (your personal independent invention falls to the inchoate right position). Such is simply not a full right, but only (if I may borrow the analogy I have seen at Patently-O), an invitation to the track meet – not a win across the finish line. You get no prize for being invited to a track meet – the purpose is to win the race, not to merely show up. The wanting to give a prize for merely showing up may be in line with the “let’s make everyone feel good about themselves” over-pampering and the installation of a non-competivie spirit (of-topic, but such pampering drives me crazy, as I think shielding people from compeition is the absolute worst way of prepearing people for the real world), but the inchoate right, the “in personam right” that attaches to a pure natural right viewpoint simply does not follow or fit into the Constitutional language – given the inherent differences between patents and copyright.

    In personam rights simply are not an easy fit with rationale behind the Article 1 command because in personam rights have no call to “promote,” and the ability to ply the secrecy route has more detrimental effects in commerce for patents than copyright. Innovation for patetns is simply different thatn innovation for copyrights. Copyright is different in that copyright is more about personal expression. Conflation here misses the core essence of patents. See also my thoughts about the public/secret issue, which I think is more on point that any leaning to a in personam argument.

    Thank you for the sources.

  • [Avatar for ceej@y]
    [email protected]
    October 29, 2011 06:17 pm

    If you would like to see an economic defense of PUR, then check Carl Shapiro’s “Prior User Rights” 96 Am. Econ. Rev. 92

  • [Avatar for ceej@y]
    [email protected]
    October 29, 2011 06:02 pm

    Also, you might enjoy reading the justifications for PUR explained by representatives of AIPLA, the USPTO, Franklin Pierce Law Center, GMU, IPO, and Rodel, Inc. All the representatives advocate for PUR. The transcripts are on LexisNexis, and can be found under the headline “Testimony October 26, 1995 Witness List House Judiciary Courts and Intellectual Property Prior Commercial Use and Patent Infringement.”

  • [Avatar for ceej@y]
    [email protected]
    October 29, 2011 05:56 pm

    @ Blind Dogma” [Regarding my assertion that prior user rights (“PUR”) are justified on natural right grounds] “an incorrect statement when it comes to patent law”
    & @ Gene Quinn ” That is a false statement of law. There is no natural right to use what you invent.”

    I thought I had joined a discussion of what patent law should be, as opposed to what it is. If that is the case, then I don’t really care what a judge would say tomorrow if I walked into their court room. I care more what a group of legislators would say since they actually make the law, and recently they have moved to protect prior users. But ultimately, I care most about what I and other average citizens believe when they go to the ballot box. You might find it curious that Frank E. Robbins did a survey in 1979 amongst patent lawyers, and there was “substantial support” for greater PUR recognition for trade secret holders. I wonder why that was. Do you have an explanation?

    While I realize that “patent law” has relied on economic justifications and not explicitly on natural law justifications, I also would assert that PUR are not a part of patent law? Despite the fact that they are partially protected by a exemption in the amended 35 USC 273, a right to use something is not a right to exclude someone else (which is the core right of patent law). PUR are part of something bigger and more ancient. A major difference with the first-to-invent system is the protection given to the first to invent and presumably use an invention as against subsequent inventors. We have never been too keen to take rights away from the first; “first in time, first in right” is a fairly old axiom right? But first-to-file strips nearly all rights from a first inventor. That doesn’t sit well with anyone, which is probably one reason why nearly all countries also recognize a prior user right, which is embodied in a prior user defense. You want an economic justification, and that’s rational; I’m totally OK with any complete explanation for why PUR are recognized. But a complete explanation is not always available to us. Even patent rights have not been justified by the economic studies I’ve read. But I also think that not all rights must wait for economic proof before they can be recognized.

    @Blind dogma: “Please explain to me again the part about how the exclusive right is exclusive if I cannot exclude someone who didn’t bother sharing that idea.”

    Sure. It’s basically the same way the the right to bear arms “shall not be infringed.” Of course it is actually infringed if it begins to affect the rights of others to live quietly and peacefully.

    I’m not sure I see the similarity between patent exclusivity and pregnancy, but I’m excited to hear how that would work. Please share a better explanation. Thank you.

  • [Avatar for Anon]
    October 29, 2011 05:30 pm

    step back,

    The corollary concern that I have has to do with the fact that if the defense is successful, then it must mean that the patent has been improvidently granted, because if what constitutes infringement by one party is excused by what is already in the public domain, then that very public domain state means that the public at large has a right to practice and the patent cannot be used against anyone.

    This personal defense carve-out smacks of someone being “a little bit” pregnant.

    Let me put this another way – I am still trying to conceptually come to terms with what to me appears to be a fatally contradictory law. The law attempts to create a personal defense based on actions by a person, that necessarily (in my view) must be open to and thus belonging to the public. So either the personal nature of the defense is flawed or the remaining ability to apply against the public what the publlic already has (the patent) is flawed, or both – but certainly, the law as it stands, well, cannot.

  • [Avatar for step back]
    step back
    October 29, 2011 01:42 pm


    I think the “commercially used” part of above reproduced section 273 (comment #23) will probably be interpreted by the courts as requiring that the used “subject matter” be somehow responsible for placing a directly related article of manufacture or service into the public stream of commerce.

    So, sticking with the hypothetical BlueFang 8080 computer chip, if the BlueFang company used a secret manufacturing process for mass producing the BlueFang 8080 computer chip and then a patentee comes along and says, hey wait a minute I have a patent for that process; shut your factory down because you are violating my published patent for that process, the BlueFang company can say, sorry, we were using that “subject matter” more than a year before your “effective date” and therefore we prevail under the prior user rights provision.

  • [Avatar for Anon]
    October 29, 2011 01:32 pm

    The idea that a defense that rewards secrecy is something that I am wrestling with conceptually.

    The purpose of the patent system is to encourage sharing of information. It is anathema to me to in any way reward secrecy through the patent system.

    Why are we introducing a protection for those who do not share? Can we modify the defense somehow to make it so that any claim to the defense must be made with evidence that is of public nature – that must be something that anyone can truely and unequivicably identify as in the public domain?

    This way, information is made public, either through the expense (with reward) of a patent or with a free pass, but without the benefit of secrecy.

  • [Avatar for Gene Quinn]
    Gene Quinn
    October 29, 2011 12:18 pm


    Maybe you are right, but haven’t the lion share of the business method troll cases been related to the financial industry? The financial industry was very late to the game in terms of trying to obtain patents, and presumably would also have difficult time proving when they started using any particular processes. I’m speculating here of course. So it might well be possible for the silicon valley tech companies to be in a better position to use prior user rights?

    As far as unreasonable assertion of the defense — I wish that rule applied across the board. I don’t understand why we would ever want to encourage (or even allow) unreasonable assertions of any defense. All that does is make litigation needlessly expensive. A form of harassment.


  • [Avatar for step back]
    step back
    October 29, 2011 04:46 am

    [[ prior user defense ]]
    12 Section 273 of title 35, United States Code, is amended
    13 as follows:
    14 (1) Subsection (a) is amended—
    15 (A) in paragraph (1)—
    16 (i) by striking ‘‘use of a method in’’
    17 and inserting ‘‘use of the subject matter of
    18 a patent in’’; and …
    ‘‘and commercially used the subject
    at least 1 year before the effective fil-
    ing date of the claimed invention that is the
    subject matter of the patent.’’;

    A person may not assert the
    defense under this section if—

    ‘‘(i) the subject matter on which the de-
    fense is based was derived from the patentee
    or persons in privity with the patentee; or
    ‘‘(ii) the claimed invention that is the
    subject of the defense was disclosed to the

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    October 28, 2011 08:41 pm

    Gene, re your questions to me, I don’t want to speculate, but it does seem to me that quite a few “troll” cases have already been on “business method” patents, and that at least some of those could have been defended with the existing statutory defense for prior commerical use of their allegedly infringing software by banking industry members and others who pushed the 1999 prior user defense statute, and presumably also pushed for this broadening of it, which was originally proposed in 1999? The absense of ANY usage of this defense suggests that other defenses must be considered easier, better and less dangerous. In particular, look what happens [now and under the AIA} if you assert this defense and lose: “(f) Unreasonable Assertion of Defense- If the defense under this section is pleaded by a person who is found to infringe the patent and who subsequently fails to demonstrate a reasonable basis for asserting the defense, the court shall find the case exceptional for the purpose of awarding attorney fees under section 285”
    As noted, any present “on sale” or “public use” activities in which a later-patented invention is buried in a sold or publicly available product, even a compute chip, no matter how hard it is to determine that, creates prior art that does not require resort to a “prior user” statute. Prior user statutes seem to be of primary benefit to secret processes for making products which do not contain or disclose the process, or for those [e.g. banks] using software they did not either publicly disclose or patent, in some cases because they did not even think it was patentable.

  • [Avatar for Anon]
    October 28, 2011 06:04 pm

    Even worse than an oligopoly would be a dominant large scale player with what would be effectively (yet legally arms reach away) small puppet firms that could evade monoply scrutiny, yet have the puppet firms at a far lower risk of patent coutnersuit, financial depth liability, and an unhealthy (anti competitive) subsidence dependency on the scraps from the larger firm. The smaller firm keeps out all other competitors, the larger firm is shielded from the “Trolls” and the “Trolls” have no interest in the much more meager pockets of the small “fronts’.

    Just trying out some devious brainstorming – not saying this would actually happen.

  • [Avatar for Gene Quinn]
    Gene Quinn
    October 28, 2011 05:30 pm


    Excellent points.

    I don’t know how often prior user rights come up directly overseas, but it is my understanding that they come up with some frequency, perhaps even a lot, in licensing negotiations. If you could use prior user rights defense against me I would rather you not and you would rather my patent remain strong if you are a licensee. So rather than fight about it companies enter license agreements otherwise the next company up would argue that the prior use by Company A wasn’t really a trade secret and was instead prior art. That would lose the patent for the patentee and the prior user wouldn’t have the ability to wrap themselves in an oligopoly shared with the patentee. Thoughts?

    I have a suspicion we are going to see prior user rights come up quite a bit in troll cases. Whether it will ultimately be successful who knows, but why wouldn’t it be raised all the time when being sued by a non-practicing entity that has no interest within the industry?


  • [Avatar for Gene Quinn]
    Gene Quinn
    October 28, 2011 05:25 pm


    I think BlueFang wouldn’t be able to use the slightly tweaked version, but the hypothetical will almost certainly arise at some point for us to eventually know for sure.

    But what about this… what if BlueFang only used it in the 8080 chip more than 1 year prior to the patent filing. Could they then use the same in the next generation 9090 chip? My fear is that the US version of prior user rights doesn’t have quite the same limitations that prior user rights have elsewhere around the globe.


  • [Avatar for Anon]
    October 28, 2011 05:07 pm

    I leave it to IANAE to take the perspective of the infringer, and quite misses the point that it is the focus of the patent system to encourage sharing and patents. The patentee must run a business to stay viable and that includes budeting future cash flows. While never an exact science, your comment, as it focuses not on the competition of the patentee – where the focus belongs – switches that focus to the silent and non-contributing (as far as knowledge sharing) entity not engaging the patent system.

    The choice of perspective may be legitimate – if the aim is not to fulfill the reason for having a patent system in the first place. That just isn’t a perspective that I am ready to embrace.

  • [Avatar for step back]
    step back
    October 28, 2011 04:10 pm

    p.s. We can also pose essentially the same question for the software arts.

    Just replaced the “tweaked” version of the circuit configuration with a “tweaked” version of a subroutine that is burned into ROM or CD and/or is already massively distributed among end users, meaning that recall will be costly.

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    October 28, 2011 04:09 pm

    Gene, this is a good topic, and the AIA does reduce the risk for trade secret users than they will get enjoined by someone else getting a patent that trade secret infringes. But I have problems with the above statement “given that prior user rights have never be utilized in the United States but are commonplace overseas.” We do indeed already have a U.S. prior user statute, and it covers thousands of issued “business method” patents, yet it has never bee successfully used. Hal Wegner has stated that even though it is legally avialable in other countries it has almost never been used in those other countries either.
    The real concern with the AIA on this issue is not with the prior user statute itself but whether the new 102(a)(1) statutory bar will be interpreted [as some argue] to overule the Metallizing Engineering el al doctine adoped by both the Fed. Cir. and the Sup. Ct., even though that doctrine is not a statutory bar, it is expressly an equitable “forfeture” applicable only to the secret [NON “public use”] commercial user itself to prevent the secret commercial user from additionally filing a patent application any number of years later to tack a patent protection term onto an indefinitely lengthy trade secret protection term, such as whenever the trade secret is threatened with loss of secrecy. That would be contrary to important patent policies and public policies well-expressed in that body of long-established case law.

  • [Avatar for step back]
    step back
    October 28, 2011 04:04 pm


    Good insight.

    As those in Silicon Valley well know, once a specific circuit design is verified and taped into a chip with thousands of others, it is extremely difficult to take it out and replace it in response to a patent law suit.

    But let’s take the question a bit further with this hypothetical.

    A high tech company named BlueFang (hypothetical) creates a HLDL (i.e. Verilog) library file defining a novel circuit configuration.

    When it was designed (more than 1 year before filing of patent by another), BlueFang intended to use the circuit only in their BlueFang 8080 chip. However, after reading the inventor’s public disclosure (i.e. his pre-grant publication), BlueFang realizes they can also use a slightly “tweaked” version of the circuit configuration in their newer BlueFang 8086 chip. The “tweak” was described in the published patent and BlueFang cannot show that they commercially used the “tweaked” version more than 1 year before the filing date. However they argue that it is essentially the same subject matter and their commercial use of the pre-tweaked version in the 8080 chip now entitles them under prior user rights to “similarly” use the tweaked version in the 8086 chip.

    What result?

    (An evil exam question for some hapless IP law students perhaps)

  • [Avatar for Gene Quinn]
    Gene Quinn
    October 28, 2011 03:25 pm

    Rob, AC and everyone else-

    I don’t know how much this will ever come up, but I did receive an e-mail from someone today that gave me pause. I was reminded that what is good for one industry isn’t always good (or the same) for another industry. For pharma there may only be one (or a few) patents involved in any infringement. So the “I don’t feel sorry for you” line works well in those industries. If it mattered so much you should have filed and you didn’t.

    But what about in the high-tech sector? Hundreds or thousands of patents could be infringed. It seems like that is where prior user rights defense will matter most, and potentially be raised quite a bit. This reminded me exactly who was pushing the prior user rights defense. If big-tech is so interested doesn’t that suggest that they see themselves using it, perhaps to battle trolls and others?

    Thoughts, comments and musings welcome. Trying to wrap my head around this for a follow-up article next week.


  • [Avatar for step back]
    step back
    October 28, 2011 03:06 pm

    Gene: need a release from your spam catcher please (thanks)

  • [Avatar for Rob Olmstead]
    Rob Olmstead
    October 28, 2011 02:48 pm


    A great topic.

    I have to agree with “American Cowboy,” though. How often will this defense ever be applicable, much less proveable?

    The use has to be (1) commercial and (2) “at least one year before” the patentee’s filing date or disclosure.
    In quickly-evolving industries, one year is a looooooooooooong time to gamble that no one else is going to discover the same thing you did. If anyone comes along and files (or discloses) in that year after you start commercially using (not discovered, but commercially using), you’re still screwed and can be excluded from your own invention, as I read it.

    Additionally, the defendant has the burden to establish, by clear and convincing evidence, he had been commercially using the same elements of the claim for at least one year before the patentee filed or disclosed. That could be a tall order. (The high bar of proving “reasonble diligence” as a comes to mind.)

    Will any lawyer really advise their client that it is a wise idea to (1) gamble that no one else will discover what you did for at least a year (2) believe you have adequate documentation to prove you had each and every element in commercial use for that year (3) gamble that no one in your company will leak the secret to a competitor in that first year (or at least that you can prove it was leaked and not independently discovered).

    I think it’s more a Hail Mary defense for a small shop that didn’t have the resources (or neglected to) patent their spontaneously invented machines or processes and built their business around that. Even then, I think they’ll have a hard time proving it.

  • [Avatar for IANAE]
    October 28, 2011 02:45 pm

    “The third party that has not undergone ANY effort to join in the patent system enjoys Freerider effects from someone else’s efforts, including the knocking out of other competitors.”

    He wouldn’t have had any other competitors anyway, if he was practicing the invention in secret. The fact that someone else has invented it independently and patented it can only add to his list of competitors.

    “The patentee simply will not know if anyone out there actually has the ability to support a prior user line of defense, thus materially increasing the risk that there may not be ANY market that can be gained by “exclusive” patent rights.”

    If he can’t tell whether anybody else is practicing his invention, how is he going to identify infringers? Sounds like he’s wasting his money applying for a patent and telling the world how to compete with him. That type of invention is ideally suited to trade secret protection, and always has been.

  • [Avatar for Gene Quinn]
    Gene Quinn
    October 28, 2011 02:30 pm


    You raise excellent questions and I don’t really have any compelling answers. I think many would try articulate clear answers to your questions as if the answer provided is true. The problem we have, however, is that we have no history of prior user rights so there is no telling what the Federal Circuit will do and how narrowly terms will be construed. Perhaps more than any other area of the America Invents Act we won’t know what we are really dealing with until we get cases to elaborate on the contours of the provisions.


  • [Avatar for Anon]
    October 28, 2011 02:30 pm

    I just posted this over at Dr. Noonan’s Patentdocs:

    Dr. Noonan,

    Above you state “The exhaustion argument you make is no different than current law, (in response to someon pointing out the particualr feature of the law that exhausts a Patentee’s rights, even on sales of those who enjoy a Prior User Defense – yes, not only is a Patentee defenseless to pursure a prior user, but the sales with the money going to the prior user forecloses – exhausts the Patentee’s rights with zero beneift for the patentee)” but this is only true to the extent of the final outcome.

    What is missing and what is very much different is the lack of ANY benefit accruing to the patentee from any such “exhaustion event” (i.e. sale). The patentee thus effectively has suffered a taking because someone else has benefited where previously a patent right had provided an exclusive nature to the item in question.

    The third party that has not undergone ANY effort to join in the patent system enjoys Freerider effects from someone else’s efforts, including the knocking out of other competitors. It is true that the defense does not provide a right to sue (and the downside concomittant cost), but the ability to sell free and clear – and the indemity afforded to those purchasing the item, materially can cut into the patentee’s expected market.

    Not only that, but there are additional negative effects to the patentee. The patentee simply will not know if anyone out there actually has the ability to support a prior user line of defense, thus materially increasing the risk that there may not be ANY market that can be gained by “exclusive” patent rights. There will now be this massive wildcard as to not only a direct infringer possibly having prior user rights, but the possibility now exists of a Huge Corporation having such hidden prior user rights and the umbrella of exhaustion protection shielding a target from an enforcement action.

    A worst case scenario: No luck on the enforcement, no luck on the market protection, no luck on the exclusive nature of the patent (there goes licensing, if the Huge Corporation can undercut your license rate), very mixed luck against enforcing against other competitors outside the shield – as “lucky you” get to bear the costs and the competitor with prior user rights enjoys the fruits of your labors (perhaps a mandatory shared legal expense requirement can be made by technical amendment, but even this may be prone to abuse by deep pocket companies).

    As this is the law, I am at a loss for a practical solution or even an approach to appraise my small start-up clients of this devaluation of patent worth (both intrinsic patent devaluation and business risk devaluation).


    This should throw an interesting wrinkle to the the Quid Pro Quo discussion, because as of now we have the Maybe Quid Pro Quo deal – with “maybe” determined only by trying to enforce and bringing litigation, and massive Freerider benefits, far beyond “protecting” unshared secret development efforts. – Sorryfo rthe nonobjective view – this is just torquing me as I am trying to evaluate how to let my samll clients understand this law.

  • [Avatar for Gene Quinn]
    Gene Quinn
    October 28, 2011 02:26 pm


    You say: “There is a natural right to use what you invented.”

    Response: That is a false statement of law. There is no natural right to use what you invent. If someone else patents an invention and you are engaging in activity covered by the patent claims you are an infringer, plain and simple. Natural right theory is not a part of U.S. patent law.

    You say: “it shouldn’t punish those who decide to keep their inventions to themselves…”

    That is exactly the theory behind prior user rights. If you have been using it (whatever “it” is) then you can keep doing what you were doing even if someone else patented it. To qualify for this defense it must have been secret though. If it were not secret then it would just be old fashioned prior art that would defeat the patent.


  • [Avatar for American Cowboy]
    American Cowboy
    October 28, 2011 09:15 am

    I agree with Step Back’s concerns (as stated in the form of a question, for Alex Trebek’s benefit). As I said in another thread, I think this defense will be rarely and narrowly applicable, so I don’t lose much sleep over it. If and when I have a client who is threatened with a patent for doing something they say they have been doing since before the patent was filed, then I’ll try to find a way to make sure that client is the Cinderella whose foot fits the glass slipper, but I don’t expect to do that often.

    Interesting observation by the Aussie, that this provision is needed when you are willing to deny the patent to the first inventor. We had such a nice, clean ideologically pure patent law years ago. Every time we adopt one of these harmonization ideas, we pollute it, make it more complicated and, ergo, weaken it. ‘

    Americans invented the delicious Big Mac, too. Have you ever had a HongKong version of a Big Mac? Makes you want to puke.

    Quit screwing up American values.

  • [Avatar for step back]
    step back
    October 27, 2011 09:15 pm


    Interesting topic.
    Thanks for raising its ugly head here and now.

    I have a couple of questions:

    1) What is the “it” that the secret user may continue to commercially use, and
    2) What is the scope of usage that the prior secret user may continue to commercially do?

    First, back to question 1. We know that a patent claim often covers many “its” (many embodiments). On the other hand when a prior user starts doing his prior using thing, that commercial using will often be just one embodiment, perhaps a specific species within a genus covered by the patentees patent claims. The prior user may not document what his “it” is (he certainly won’t write a claim defining “it”) and he may start changing “it” to comport with the patentee’s broader set of “its” once the secret user learns from the patentee’s public disclosure that a broader set is possible. Where in the law (AIA 2011) does it say what the scope of the user’s “its” is is?

    Next for question 2. Suppose the secret user envisaged using his limited “it” (the one and only) in only area of use. But once the secret user learns from the patentee’s public disclosure that there are many more possible fields (or baseball bases) of use, the prior user starts to expand the scope of his commercial use. Is this allowed? Where in the law (AIA 2011) does it say so.

    Question 3: What burden of proof does the secret user have to meet to prove that he was secretly using exactly his small set of “its” more than 1 year before the patentee filed (filed what?).

    These are just a few questions that kind of bother me about prior secret use. Maybe others here secretly harbor other questions that they wish to go public with? Thanks.

  • [Avatar for Blind Dogma]
    Blind Dogma
    October 27, 2011 05:41 pm

    Ah, a Kool-Aid break for the day!

    There is a natural right to use what you invented

    Careful with that natural rights stuff. It’s a dangerous weapon.

    But unfortunately for you, that is also an incorrect statement when it comes to patent law. Even with the AIA becoming law, if you are hauled into court and try to use that defense (yes, the proper term is defense, not “right” – but for the rest of my post jabbing a little fun at you, let’s go with “rights”)) and have not met the requirements of that defense, you will be singing the blues.

    There is saying you might want to become familiar with (especially if you get in the habot of posting on legal blogs): Ignorance of the law is no defense. (there is another non-legal saying that might fit: it’s your right to be ignorant, but you may have to pay a steep price for that right).

    but it shouldn’t punish those who decide to keep their inventions to themselves.” – You might want to have a word with our founding fathers – they had something else in mind when they wrote the Constitution. Of course, if you feel strongly about this, you can move to a different country with a different Constitution. You do have that choice.

    protecting a non-exclusive natural right (prior user right) against an exclusive statutory right” Please explain to me again the part about how the exclusive right is exclusive if I cannot exclude someone who didn’t bother sharing that idea? You do know the meaning of “exclusive”, yes? (it does not take a lawyer to know that one, it might help, but it is not mandatory).

    You are reading economic research? If you stay at a Holiday Inn, then you can practice law too. (I am only kidding – you don’t even need to read economic research for that, right Bobby?)

    “partial exclusive” – sort of like “a little bit pregnant”, right?

  • [Avatar for ceej@y]
    [email protected]
    October 27, 2011 03:44 pm

    There is a natural right to use what you invented. An inventor should not feel compelled to pay a patent attorney and the patent office substantial fees to guarantee a right to use his own invention. Participation should be a great option, but it shouldn’t punish those who decide to keep their inventions to themselves. A patent is essentially a special award given to a person that “teaches” the world how to make and use an invention. There is nothing unconstitutional about protecting a non-exclusive natural right (prior user right) against an exclusive statutory right (patent right) based on unproven economic policy (The economic research I’ve been reading does not support the intuitive “incentive theory.) The Constitution gives Congress the authority to promote the spreading of technology through awarding totally exclusive rights for a limited term. Of course Congress also has the authority then to grant partial exclusive rights. The two extreme outcomes that existed before this latest reform were unacceptable.

    Also, isn’t it true that “prior user rights” were explicitly coded into the patent statute from 1836-1952?

  • [Avatar for Anon]
    October 27, 2011 03:03 pm

    Thanks Gene,

    As if on cue, I have finally gotten around to my daily email newsletter from Hal Wegner, and I just wanted to point out the timing aspect;

    Under SEC. 5(c), ?[t]he amendments made by this section shall apply to any patent issued on or after the date of the enactment of this Act.?

    This is in play. NOW.

  • [Avatar for yoobee]
    October 27, 2011 03:01 pm

    I like the points that you raise. What are your thoughts on the university exception to the prior use defense? I have been trying to find some good commentary explaining the justification for this exception, but I haven’t found much. Even the congressional debate minutes offer little guidance. In addition, I think that the “exception to the exception” is poorly worded and could be read in two very different ways.