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On September 16, 2011, President Obama signed into law the America Invents Act (AIA), which introduces substantial changes to United States patent law. Although some provisions of the AIA go into effect immediately, many of the most substantial changes, such as conversion from a "first-to-invent" to a "first-to-file" system, will not come into effect for 18 months. By phasing in portions of the AIA over the next 18 months, the U.S. Patent and Trademark Office (USPTO), applicants for patents and other participants in the patent system, have time to prepare for the forthcoming changes. See the USPTO website for information about implementation of the AIA, including upcoming rulemaking activities.
Below are some of the more significant changes scheduled to come into effect.

Changes Immediately in Effect

The following changes to U.S. patent law are already in effect, and include most of the provisions of the AIA which most directly affect patent litigation:

• More stringent requirements must be met to include multiple defendants in a single patent infringement suit. Now it is generally required to file separate lawsuits for each defendant, which significantly increases the costs for enforcing a patent against many parties.
• Qui tam false marking suits, in which a third party could seek monetary damages for improperly indicating products are covered by a U.S. Patent, have been narrowly restricted to parties suffering competitive injury as a result of false marking. Nearly all false marking cases currently before the courts, as they do not meet this requirement, will likely be dismissed. Futher, an expired patent mark will not be considered a false mark, while "virtual" marking using websites is expressly permitted.
• The prior commercial use defense to patent infringement is expanded beyond just business methods to cover any process or "a machine, manufacture, or composition of matter used in a manufacturing or other commerical process," for patents issued after September 16, 2011.
• Allegations that a patent fails to disclose the "best mode" of practicing an invention are no longer available as a defense in patent infringement cases.
• A new "micro entity" status, similar to the preexisting "small entity" status, is entitled to a 75 percent reduction in USPTO fees.
• Inter partes reexamination may be granted under an elevated test that there is "a reasonable likelihood that the requestor would prevail."

Changes Coming Into Effect Over the Next 60 Days

As of September 26, 2011, many USPTO fees, including application filing fees, maintenance fees and extension of time fees, are increased by 15 percent. The USPTO has also been granted authority to change its fees.

Also as of September 26, 2011, the USPTO will implement the prioritized examination procedure discussed in our April 11, 2011, Alert. For $4800, subject to certain requirements and procedures, an application may reach a "final disposition" within one year, versus a more typical 3-5 year period.

As of November 15, 2011, a $400 surcharge will be imposed on applications which are not filed electronically through the USPTO website.

Changes in Effect After One Year

Beginning on September 16, 2012, the following changes, which provide enhanced procedures for challenging patents and patent applications through the USPTO, will come into effect:

• Third parties, which currently have very limited opportunities for participation in the original examination of patent applications, are provided enhanced procedures for submitting prior art for review by the USPTO during examination.
• New inter partes review procedures will be implemented, replacing inter partes reexamination. Such reviews will be conducted by the Board and overseen by Administrative Patent Judges, rather than the examiners of the current Central Reexamination Unit.
• Transitional post-grant procedures specifically for business method patents relating to financial products will be implemented.

Changes in Effect After 18 Months

In general, the final set of changes expand the amount of material available as "prior art" against applications and patents with a filing date (either in the U.S. or abroad) on or after March 16, 2013. Additionally, a new post-grant procedure will be provided for those seeking invalidation of such patents through the USPTO.

• U.S. patent law will switch to a "first-to-file" system, similar to most other countries.
  • Under the current "first-to-invent" system, some items may be removed as "prior art" against a patent if an inventor can show they were the first to invent the invention. But under the new "first-to-file" system, the filing date for an invention will be more critical, as any items from before the filing date for an invention are prior art (with limited exceptions based on previous disclosures by an inventor).
  • As a result, it is expected that inventors will seek faster filing of inventions, and increase the use of provisional applications, to establish an early filing date.
  • There will be more predictability as to which items are included in the prior art, as a patent owner will no longer be able to "swear behind" the date of an item.
• Currently, prior art consists of printed publications, public use, and on sale activities. This will be expanded to further include anything "otherwise available to the public."
• U.S. patents and U.S. patent application publications will have an earlier date as prior art if they were originally filed in another country, as they will be considered prior art as of their foreign filing date. This may be up to one year earlier than under current law.
• New post-grant review procedures will be implemented. Patents with a priority date on or after March 16, 2013, may be challenged on any ground within nine months of issuance. As with inter partes review, the Board will oversee such reviews.

If you have any questions, or would like more information about the foregoing, please contact your regular Baker Hostetler contact or the author of this alert, Eric M. Shelton ( or 202.861.1571).