Those of us who are somewhat outside of the chemical area look at this and grow green with envy. The Takeda approach has a strong similarity to the European problem-and-solution approach.  In the European problem-and-solution approach to the examination of inventive step (a.k.a. obviousness), the first step is the determination of the “closest prior art.”  In determining the closest prior art, the first consideration is a similar purpose or effect.  In order to determine non-obviousness, the problem being solved by the claimed invention is identified and a determination is made as to whether it was obvious to provide the differences between the claimed invention and the closest prior art in order to solve the problem.

Comparing the two approaches, the Takeda approach and the “problem-and-solution approach,” the lead compound is similar to the closest prior art.  In the problem-and-solution approach, the determination of whether it would have been obvious to provide the differences between the claimed invention and the closest prior art relies on the “could/would analysis” – whether the prior art would  (“not simply could, but would”) have led one skilled in the art trying to solve the problem to provide the differences between the claimed invention and the closest prior art.  The “could/would analysis” is very similar to the second requirement in Takeda – the determination of whether the prior art would have provided a reason or motivation to modify the lead compound.

Although we are not clamoring for a return to the TSM approach that led to the KSR decision, the problem- and-solution approach, within the expanded framework for motivation given in KSR, would provide a rational approach to obviousness determination which will make the life of the patent practitioners more bearable.  However, only the courts and mainly the CAFC, can get us there.  The BPAI  (soon to change names) can not be expected to make this change since it would be tantamount to “cooperating with the enemy.”  I would not expect that the voice of a single blogger would have any impact on moving the CAFC.  So, as Tom Lehrer would say, “Hip hip hooray, let’s hear it for the problem-and-solution approach!” Please join me in this chant.

From another viewpoint, the importance of patent strategy also appears in the liability of officers and directors for actions related to the lack of sufficient IP protection, as outlined in a webinar presented this week by West LegalEd Center, in which two of my colleagues at Burns &  Levinson were presenters.

Thanks partially due to the Nortel patent auction, 2012 finds patent strategy being of interest to the corporate management.

If restricted to only the claim construction and the analyses of anticipation and obviousness, this opinion would have been a fairly standard type of opinion; however, in discussing the claim construction, Judge Plager also discusses the approach to claim construction at the CAFC.  As stated in the opinion, claim construction at the CAFC has been described as depending on which approach to claim construction the appeal panel uses, whether to focus on the invention disclosed in the patent or focus on the words of the claims as drafted (There is a hint of this controversy in the opinion for Re-tractable Tech., Inc. v. Becton, Dickinson & Co. in which Judge Plager wrote a consenting opinion and Chief Judge Rader wrote a dissenting opinion).  Judge Plager makes an attempt to reconcile the two approaches, stating that an inventor is entitled to claim what he has invented and no more, but an inventor can narrow the claims to less than described.  While some arguments can be raised about the reconciliation of the two approaches proposed by Judge Plager, the discussion sheds some light on the problem of claim construction.

In answering the dissenting opinion by Judge Mayer, Judge Plager provides both a good review of the large number of patentable subject matter opinions (also referred to as § 101 jurisprudence, referring to the section of the Patent Statute defining patentable subject matter) that had followed the Supreme Court opinion on Bilski and the discussion as to what constitutes an “abstract idea,” which is not patentable subject matter.  While not providing a test for what constitutes an abstract idea, Judge Plager provides a good description of § 101 jurisprudence in an analogy to oenologists describing a new wine.  The adjectives are the same as used in describing any wine, but the combination of adjectives depends less on the actual meaning of the words than on the taste buds of the experts.

Overall, we have to thank Judge Plager for providing us with more food for thought on two of the meatiest issues facing us as patent lawyers, how claims are interpreted on appeal (and what that means in terms of how we write the claims) and what constitutes an un-patentable “abstract idea” (which would give us some guidance as to how to claim the invention so as to avoid the “abstract idea” tag).

(5)    In this blog post, we consider the last three request for comments, relating to possible regulation changes, namely: to accomplish adequate and timely recording, are changes to agency regulations necessary?  What are the most effective and appropriate means for the USPTO to provide the public with a timely and accurate record of the assignment of patent rights and the assignee?

(6)    Would it help the USPTO’s goal of collecting more updated assignment information if 37 CFR1.27(g)(2) was amended to require identification of any new ownership rights that caused the application or issued patent to lose entitlement to small entity status?

(7)    Given the passage of the America Invents Act, is it proper for the USPTO to provide financial incentives for disclosure of assignment information by way of discounts in fee payments? 

In regard to what changes in regulation are likely to be necessary, if the purpose of the change in assignment practice is to provide proper notice to the public, such a change is not covered by any of the regulations in 37 CFR part 3.  If the public were to be provided a timely and accurate record of the changes in assignment from the time of allowance or grant forward, 37 CFR part 3 should be changed to provide rules allowing for providing a timely and accurate record of the changes in assignments.

In regards to whether 37 CFR1.27(g)(2) should be changed, 37 CFR 1.27 (g) (2) already imposes a duty on the practitioner and/or the applicants to notify the USPTO when a change of entity status occurs.  There appears to be no reason to modify 37 CFR 1.27 (g) (2).

In regards to providing an incentive for the disclosure of assignment information changes besides that negative incentive provided by 37 CFR 1.27 (g) (2), there are a number of possible ways of giving a financial incentive for discount if a change in assignment information is recorded.  The approach suggested in the request for comments, a discount in the maintenance fee payment, appears to be a workable one.

We look forward to how the USPTO implements the rule changes for assignments.  The USPTO should be lauded for proceeding according to the letter and spirit of the rule-making process.

The group of requests, including the second request through the fourth request reproduced below, relate to the requirement of information to be provided by the applicants:

2)      Would it be in the public interest for the USPTO to obtain from applicants, updated identification of the assignee at the time of allowance, e.g. in response to the Notice of Allowance?  Are there limitations on the USPTO’s rights and powers to require the reporting of such information?

3)      Would it be in the public interest for the USPTO to obtain from applicants, updated identification of the assignee during prosecution of the application?

4)      Would it be in the public interest for the USPTO to obtain from applicants, updated identification of the assignee after issue of the patent?   What are the appropriate consequences of non-compliance?

Because of the effect of information, the answer is different whether the information is provided after the notice of allowance or at the time of issue, during prosecution (before the patent is allowed), or after the patent has been issued.

Requiring reporting assignment information at the time of allowance, or preferably from the time of payment of the issue fee, could serve a public function of alerting the public as to who would be the damaged party if others made or used the patented invention.  Such notice would fall under the mandate of the USPTO to disseminate public information with respect to patents (see 35 USC 2).

On the other hand, obtaining updated identification of the assignee during prosecution can impose a burden on the small inventor since the assignee (typically the small inventor’s own company) could change during prosecution.  It is not atypical for small companies to dissolve and reform or change structure during the long time it takes today for patent prosecution.  There could also be no justification in the statute since, until the patent is granted, the claimed invention is not definite.  It would be harder to justify under the statute to disseminate the public information that is not significant.  Since the claims are not yet finalized, the claimed invention is not defined.  Therefore, the function of public notice is not served because the public does not know what claimed invention to avoid or invent around.

Obtaining from the applicants/patentees updated information of the assignee after issue of the patent and publishing that information in the Official Gazette, would serve the public since it would update the knowledge of the damaged party if others made or used the patented invention.  The assignment information could include the granting of exclusive licenses, which could give others besides the listed assignee the ability to sue.  Providing that information would definitely fall under the mandate of the USPTO to disseminate public information with respect to patents.  Such information, the update on the assignee and the listing of exclusive licensees (which is harder to obtain today), would be beneficial to the public.

Although we may not be able to influence the final decision, and some may consider this inquiry by the USPTO as an effort to update from small entity to large entity applications and thereby extract more fees, the present inquiry can also be viewed as the USPTO’s attempt to improve the performance of their duty to disseminate that information.  Viewed as the latter, such an attempt should be lauded.

The Federal Register notice issued on November 23, 2011, which details the proposed rules for assignments, documents requests comments in the following areas (provided as listed in the Federal Register):

(1)    Is there any reason why the mandatory disclosure of any assignee or assignees should not take place at the time of application filing?

(2)    Would it be in the public interest for the USPTO to obtain from applicants updated identification of the assignee at the time of allowance, e.g. in response to the Notice of Allowance?  Are there limitations on the USPTO’s rights and powers to require the reporting of such information?

(3)    Would it be in the public interest for the USPTO to obtain from applicants updated identification of the assignee during prosecution of the application?

(4)    Would it be in the public interest for the USPTO to obtain from applicants updated identification of the assignee after issue of the patent?  What are the appropriate consequences of non-compliance?

(5)     To accomplish adequate and timely recording, are changes to agency regulations necessary?  What are the most effective and appropriate means for the USPTO to provide the public with a timely and accurate record of the assignment of patent rights and the assignee?

(6)    Would it help the USPTO’s goal of collecting more updated assignment information if 37 CFR 1.27(g)(2) were amended to require identification of any new ownership rights that caused the application or issued patent to lose entitlement to small entity status?

(7)     Given the passage of the America Invents Act, is it proper for the USPTO to provide financial incentives for disclosure of assignment information by way of discounts in fee payments?

We look at the first request from the point of view of the small inventor who is starting a company.  Due to the long pendency of a patent application, by the time the application is allowed, in many instances the inventor has moved on to another venture.  The application could be useful in that second incarnation of the company because the entrepreneur is also typically the inventor, or one of the inventors.

Having the application assigned to the first venture, which is defunct by the time the application issues, will create unnecessary problems if the inventor has not taken funds from a third-party.  Creating these extra problems for an entrepreneur would not be in keeping with the spirit of the America Invents Act or with the constitutional basis for the patent system and the USPTO.  From the point of view of the small inventor starting a company, the proposed rules can result in “unnecessary roughness,” but the ombudsman is not a referee.  As one of my clients said recently, “It is getting so painful to apply for patents that I don’t know if I should bother.”  Since the proposed rule could result in more pain to the small inventor, we are inclined to object to its passage.

While innovation is the product of a creative mind, patents relate to property, although intangible property, and the decision to acquire property has a strong economic/financial component.  The questions to be asked in deciding whether to patent are not the “why?” of the scientist or the “isn’t this neat/cute?” of the creative mind, rather the two classical questions of marketing:”so what?” and “who cares?” In deciding which of the inventions to patent, the problem being solved (so what?) and the market being addressed by that problem (who cares?) should be strong considerations.

The relationship between patents and innovation was best described by President Lincoln, an American not known as an inventor although he did have one patent.  He said that patents “added the fuel of interest to the fire of genius, in the discovery and production of new and useful things.” The economic effect of innovation can be affected by the act of patenting; therefore, the America Invents Act should actually be called the “America Profits From Invention Act (or the APIA); however, the more accurate name would not have the same appealing effect.  I hope that we do not confuse that which we do for marketing impact as compared to the actual product.

The second question raised by the decision in Retractable Technologies, is whether some degree of deference should be given to the trial judge in regard to the claim construction.  Claim construction is a “mongrel” task – it includes both elements of law and of fact (a determination of obviousness falls in the
same category).  In claim construction however, as was stated in Phillips, the intrinsic evidence, specification, prosecution history and the claims themselves, are more important than extrinsic evidence, such as dictionaries and experts.  Ever since Cybor v.Fas, the Federal Circuit has reviewed claim construction de novo.  The question that has been posed by many litigators is whether some deference
should also be given to the trial judge in regard to claim construction.  While an en banc rehearing for Retractable Technologies would have provided an opportunity to revisit the standard for review of claim construction, both of these issues together would have generated a forest worth of amicus briefs.