Patents & IP Law – United States Patent Applications: Significant Rule Changes on The Way

01 November 2007 LAWFUEL – The Legal Announcement Service – The much anticipated changes to the United States patent rules will come into effect on 1 November 2007, with the United States Patent and Trademark Office (USPTO) publishing the final form of the new rules on its website on 21 August 2007. Following feedback from the public, the new rules are a compromise on those originally proposed early last year, but they will still have a significant effect on patent practice in the US. Some of the changes are discussed below, together with tips for managing the impact of these changes on your patent portfolio.

Rule changes for continuing applications

As the law currently stands, there is no limit to the number of continuation applications or requests for continued examination (RCE) that can be filed on a US patent application. These mechanisms allow a patent applicant to continue the examination process, even when an examiner has effectively closed it off.

The modified rules allow only two continuation applications plus one RCE per patent application family as a matter of right. While this is a compromise on the original proposal of only one continuation application or RCE, it will still severely limit an applicant’s ability to continue to argue its case with a US examiner. The USPTO will permit ‘one more’ continuation application (but not an RCE) for applications already pending on 21 August 2007, regardless of how many continuation applications or RCEs had been filed previously, so cases with a long examination history will not be shut out altogether by the introduction of the new rules. Any continuation application or RCE beyond these limits may only be filed if it includes new material, and will have to be justified by showing that this material could not have been submitted previously. This test is likely to be applied stringently.

Divisional applications can be filed in response to a restriction requirement (examiner’s assessment of multiple inventions), but in a significant compromise they do not have to be filed while the initial application is still pending provided that an application in the chain is still pending. Thus, the final rules allow divisional applications to be filed in a series, rather than requiring that all divisional applications are filed simultaneously.

Each divisional application will also be entitled to two continuation applications and one RCE without any justification. However, the continuation application cannot be a continuation-in-part application.

The continuation application rules apply to all applications pending at 1 November 2007 and filed on or after 1 November 2007. Going forward, we are likely to see greater use of examiner interviews early in the examination process to discuss claim scope and language, and more appeals of examination decisions, rather than using up the limited number of continuation applications or the one permitted RCE (absent special reasons).

Rule changes for examination of claims

Under the new rules an application may contain up to 25 claims, with no more than five of them being independent claims (5/25 claim threshold). Again, this is a compromise on the original proposal of ten representative claims. An examination support document (ESD), which includes a search statement and discussion of cited prior art, is required if more claims are presented. There is an expectation that applicants will try to avoid filing ESDs where possible, because they are likely to be onerous to prepare and because errors or omissions in the ESD could lead to file history estoppel. If an application exceeding the new claim limits is filed without an ESD, the applicant will be required to file an ESD, a suggested restriction requirement (SRR) or an amendment to reduce the number of claims.

This change applies to all applications on which a first Office Action on the merits has not been issued by 1 November 2007.

Rule changes for closely related patent applications

Under the new rules, it is necessary to notify the USPTO of patents or pending applications that are commonly owned, have a common inventor and have the same or a similar (within two months) filing or priority date. If these patents or patent applications have substantially overlapping disclosures and the same filing or priority date, the USPTO will presume that they contain ‘patentably indistinct claims’.

Where commonly owned patent applications are presumed to have patentably indistinct claims, the applicant must either rebut the presumption, or file a terminal disclaimer if it is accepted that the applications contain patentably indistinct claims. One of the consequences of failing to rebut the presumption is that the USPTO will effectively treat the applications as a single application, including for the purposes of the new 5/25 claim threshold.

These rule changes apply to any non-provisional application pending on or after 1 November 2007. For applications that were filed before 1 November 2007, applicants will have until 1 February 2008 to comply with the new requirements.

What can IP managers do now to prepare for the rule changes?

Review your patent portfolio to identify cases where continuation application(s) or a RCE may be required and consider the advantages and disadvantages of filing these before 1 November 2007, bearing in mind the allowance of ‘one more’ continuation application for applications that were filed before 21 August 2007. There may be cause to file multiple continuation applications on important cases before the new rules come into effect. However, there is a risk that the USPTO will treat these as a single application if they contain patentably indistinct claims.
Identify patent applications with two or more previously filed continuation applications or one or more previously filed RCE. If a further RCE is likely to be required, consider filing it before 1 November 2007.
Identify patent applications requiring claim reductions and consider filing these before 1 October 2007 with a request for refund of excess claim fees. Claim amendments before examination may be prudent, but be wary of removing independent claims directed to what might be considered separate inventions, as this may prevent the later filing of divisional applications.
Review patent applications that are in preparation and consider reducing claim numbers to meet the 5/25 claim threshold, and filing applications before the rules come into effect.
Review your portfolio to identify patents and patent applications that are likely to be subject to the rule changes for closely related patent applications. Devise a strategy for handling their possible consolidation and to comply with the requirement to notify by 1 February 2008 of patent applications having a similar filing or priority date and a common inventor/ownership.
These changes are significant and IP managers should give consideration well before 1 November 2007 to the likely impact of the new rules on their patent portfolio. Focus on key patent assets and, if appropriate, take action now.

A US court granted an injunction on 31 October to prevent the new rules discussed in this article from coming into effect as planned on 1 November 2007. The injunction results from one of the court cases brought to challenge the rules mentioned previously. We will continue to monitor developments.’

This article was written by Debra Tulloch, Consultant Patent Attorney, Freehills Patent & Trade Mark Attorneys and James Cherry, Partner, Freehills Patent & Trade Mark Attorneys.

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