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Ahead of the Curve Auto Supplier Blog

July 16, 2012

Navigating the Sea Change in Patent Law

The automotive industry is built on innovation. One of the keys to protecting your innovations is patents. Patent law as we’ve known it is about to change. The American Invents Act (AIA) was signed into law last September, marking the biggest change to patent law in 59 years. What does this mean for your company? A lot! The new system is intended to improve the application process, improve patent quality and provide more certainty in litigation. Some of the most significant changes from the AIA are highlighted below. Most notably, the AIA will change the rules for deciding which inventor is the “first” inventor – and therefore entitled to the patent. On March 16, 2013, the U.S. will shift from its current “first to invent” system to a “first (inventor) to file” system, bringing the U.S. system in line with the rest of the world. The filing date will define who is entitled to the patent. And the filing date also will define what is and is not prior art. Companies should consider the motivations to file early and often. Additionally, and effective immediately, applicants may “fast track” their application for a $4,800 fee. The fast track should accelerate, on average, final disposition to 12 months. Further, beginning September 16, 2012, applicants will be able to file prior art in third-party patent applications. The submissions are limited to patents and publications and may be submitted anonymously, though comments are required. The AIA will also change the way patents are defended and challenged. For example, prior user rights may be used as a defense to an infringement suit for manufacturing process and machine patents issued after September 16, 2011. The user must show that the technology was in “commercial use” more than one year before the earlier of either the filing date or public disclosure by the patent applicant. Additionally, there will be a number of post-grant procedures available for challenging and strengthening patents beginning September 16, 2012. These procedures include post-grant review, inter partes review, and supplemental examination. These procedures should be faster than litigation. The procedures should be considered in offensive and defensive strategy discussions. Finally, Congress has given the Patent Office the ability to set its fees. Significant increases have been proposed. Accordingly, you may want to plan for an overall increase in your patent budgets. Proposed fee changes are below, with the old fee listed first and the new fee listed second: Application: $1,250,  $1,840 RCE: $930, $1,700 Appeal: $1,240, $4,000 Issue/Publication: $2,040, $960 Maintenance: $8,710, $12,800 Ex parte reexam: $2,520, $17,750 In short, the AIA aims to improve the patent application system, to bring it in line with the rest of the world, and to improve the efficiency (and reduce the cost) of patent litigation.We will all need to stay tuned to see if the new system actually delivers.

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