Faculty Voices | Summer 2012
Businesses prefer legal certainty. Whether environmental regulations, security disclosure obligations or tax laws, legal certainty permits companies to plan efﬁciently. The same is true for companies engaged in innovation: certainty surrounding intellectual property laws allows companies to invest efﬁciently in research, development and commercialization. Unfortunately, the last two years have seen little legal certainty in patent law. Both the courts and Congress have introduced considerable changes and, consequently, uncertainty into the system.
The evolution of U.S. patent law is generally coordinated by the U.S. Court of Appeals for the Federal Circuit, which hears every appeal arising under the patent laws. The Supreme Court, however, has taken a heightened interest in patent law, deciding six cases over the last two terms. Six may not seem like many, but when the Court only hears around 80 cases total per term in all legal areas, six is a sizeable proportion of the docket. While many observers believe the Supreme Court is “anti-patent,” the Court’s decisions present more of a mixed bag.
The Supreme Court agreed with the Federal Circuit’s reasoning in three cases and rejected it in the others. For example, the Supreme Court afﬁrmed the strong presumption of validity afforded issued patents in litigation in Microsoft v. i4i but continued to contract the types of inventions that are eligible for patent protection in Mayo Collaborative Services v. Prometheus Laboratories. The wake of any Supreme Court decision creates uncertainty as the courts sort through the decision’s implications. For instance, after Mayo, courts now will have to re-address whether isolated human genes are eligible for patent protection.
The Supreme Court was not alone in changing the law, however. The Federal Circuit heard numerous cases en banc to reconsider its previous law. As a result, the court altered the standard for bringing contempt hearings against an infringer, made it far more difﬁcult to render a patent unenforceable due to a patent holder’s inequitable conduct before the U.S. Patent and Trademark Ofﬁce (USPTO), and limited the availability of an infringement defense that arises when a patent’s scope is changed through post-issuance proceedings at the USPTO. The court is deciding two more cases en banc that will address when liability arises for patent infringement when multiple parties perform parts of a patented process, yet no single entity performs the entirety of the process or method. This dynamic is important for the protection of Internet-based inventions.
If all of this court-related activity were not enough, Congress ushered in the most signiﬁcant changes to patent law in over 60 years by adopting the America Invents Act (AIA) in September. In addition to creating a host of procedures at the USPTO, the AIA removes what had been the singular, deﬁning aspect of U.S. patent law: the “ﬁrst to invent” system. Before the AIA, the ﬁrst person to create the invention could get a patent. As a result of the AIA, starting in 2013, the patent will go to the ﬁrst inventor to ﬁle an application at the USPTO, which brings the U.S. law more in-line with foreign systems.
There is considerable uncertainty surrounding the AIA, however. Even though Congress justiﬁed the AIA on harmonization grounds, the AIA actually creates a system considerably different than other countries’ regimes. The AIA is also rife with ambiguity that will require time and litigation to sort out. Complicating matters more is that patents under the old system will remain in effect until at least 2033, meaning that effectively the U.S. will have two patent systems for two decades. A nightmare for innovators, but a ﬁnancial ﬁeld day for patent attorneys.
Consequently, the last two years have been ones of considerable change and uncertainty in patent law. Perhaps the courts and Congress will let the dust settle and permit businesses to ﬁnd certainty in this brave new patent world.
Timothy R. Holbrook is a professor of law and the new associate dean of the faculty. He specializes in patent law and intellectual property.