PATENT BASICS

I. Definition of patents

A patent is a bundle of exclusive rights with respect to intangible property (an invention) that is granted for a limited time by a government through a legal instrument. These rights extend only throughout the territorial jurisdiction of the particular government issuing them. In the United States, for example, patents are granted through the United States Patent and Trademark Office (USPTO) and are enforceable only in the United States, its territories and possessions.    

II. Types of patents

There are three basic types of patents issued by the USPTO. Utility patents – the focus of this summary of basic patent law – are issued for new and useful machines, articles of manufacture, compositions of matter, or processes, or any new and useful improvement of any of these. Design patents are issued for new, original, and ornamental (i.e., not primarily functional) designs for articles of manufacture. Plant patents are issued for asexually reproducible, distinct, new varieties of plants. 

III. The purpose of the patent system

The United States patent system has its origins in the United States Constitution, which provides in Article I, Section 8, that Congress shall have the power “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” Pursuant to this constitutional authority, Congress began enacting patent laws as early as 1790. A general revision to the patent laws was undertaken by Congress in 1952 and was codified in Title 35 of the United States Code beginning in 1953. More recently, Congress further modified the patent system through the establishment of the American Inventors Protection Act of 1999 (AIPA) and the America Invents Act of 2011 (AIA).   The fundamental idea behind the patent system is that granting exclusive patent rights to inventors for a limited time fosters innovation in science and technology, which benefits society as a whole when innovations in the relevant art are made public. The patent laws specify what may be patented and under what conditions a patent will issue. They also establish the authority of the USPTO to administer the patent application system.       

IV. Rights granted by a patent

A patent for an invention gives the patent holder the right to stop others from making, using, importing, offering for sale, or selling physical embodiments of the invention in the United States. It does not, however, grant the patentee the right to make, use, import, offer for sale, or sell the invention himself. For example, one who secures a patent on an improvement to an existing patented invention of another may not be able to make, use, import, offer for sale, or sell his improvement if it would infringe on the patent on the underlying invention. By the same token, the owner of the patent on the underlying invention could not make, use, import, offer for sale or sell the new improvement without securing the rights to do so through licensing or otherwise.   

V. Definition of inventions

Utility patents are not granted on mere ideas or suggestions. In the context of the patent system, the term ‘invention’ refers to an idea by one or more persons of a complete and operative way of making a machine, manufacture, or composition of matter, or of performing a process or any improvement thereof.        

VI. Scope of patentable subject matter

The United States Supreme Court has noted that Congress intended the patent laws to “include anything under the sun that is made by man.” Diamond v. Chakrabarty, 447 U.S. 303 (1980). Patentable subject matter with respect to utility patents therefore includes a diverse range of things: machines, products of manufacture, chemical compositions, living matter, computer software, and business methods.   Unpatentable subject matter tends to fall into three general categories: 1) laws of nature; 2) natural phenomena; and 3) abstract ideas. The mere arrangement or meaning of printed matter is not patentable, though if used in cooperation with some structure, it could be. A naturally occurring plant is not patentable, though if genetically engineered, it could be. A naturally occurring substance which is purified in the laboratory to an extent not found in nature alone may be patentable. Mere aggregations of things – a refrigerator with a built-in microwave on top, for instance – are not patentable. Inventions which simply do not work are not patentable, either, because they are not useful (e.g., a perpetual motion machine).    As a matter of public policy, however, certain specific types of inventions that would otherwise meet the criteria for patentability may still not be patented. In the Atomic Energy Act of 1954, for example, Congress expressly exempted from patentability any inventions useful only in using certain nuclear material or atomic energy in an atomic weapon. 42 U.S.C. §2181(a). Furthermore, the USPTO will decline to issue a patent to any invention that is useful only for unlawful purposes, e.g., an improved burglary tool (the invention must have some legal use somewhere in the United States). The AIA prohibits granting patents for human organisms.    

VII. Criteria for patentability

To be entitled to a utility patent under U.S. law, an invention or improvement must be useful, novel, and non-obvious. The term ‘useful’ refers to the utility of the invention, i.e., it must be capable of operating or accomplishing something functional. The term ‘novel’ means before being invented by the applicant, the invention previously was not known or used by others in the United States and was not patented or described in a printed publication anywhere in the world (it should be noted that in many foreign countries, the application cannot be filed at all beyond the date of first public use or disclosure). The term ‘non-obvious’ means that that invention would not have been readily apparent to a person of ordinary skill in the particular category of technology to which the invention is related (e.g., mere changes in color or size are typically not sufficient for a patent to issue).    

VIII. Term of validity of a utility patent

Generally speaking, a utility patent will be valid for 20 years from the filing date of the application, the payment of any required maintenance fees. By contrast, design patents last for only 14 years. With respect to utility patent applications filed after 12 December 1980, maintenance fees must be paid 3 1/2, 7 1/2, and 11 1/2 years after the patent is issued in order for the patent to remain in force.   The filing date of a patent application, therefore, not the issue date of the patent, determines when the term of the patent begins to run, subject to adjustments for certain processing delays caused solely by the USPTO. The filing date is also significant because it delimits the prior art available to defeat patentability.   

IX. Priority 

The legally cognizable inventor is the first to file a patent application for the invention. Under the AIA, inventors are afforded a one-year grace period from public disclosure of the invention to file a patent for it. It is important to note, however, that many other countries have no grace period, or limited grace periods for filing, so any public disclosure prior to filing may impact adversely the opportunity to get a patent in a foreign jurisdiction. 

X. Types of patent applications

First-time patent applications fall into one of two main categories: non-provisional and provisional. Non-provisional applications are full applications containing specifications, drawings, and claims that will be examined for patentability. Provisional applications, by contrast, usually contain only specifications and drawings – no claims – and are never examined for patentability, but rather, are used only to establish an effective prior art date against which to evaluate the novelty of the invention. Following the filing of a provisional application, a non-provisional application must be filed within 12 months – and while the provisional application is still pending – or the provisional application will be deemed abandoned, resulting in the loss of the benefit of the filing date of the provisional application   The improper use of provisional applications can lead to the loss of all patent rights. For example, if the specification included in the provisional application does not support the claims presented in the subsequent non-provisional application, i.e., the description of the invention in the provisional application is not enabling, then the claims in the non-provisional application will not be supported as of the earlier provisional filing date. Any potential statutory time barring event, such as public use or sale of the invention within a year prior to filing the provisional application, that would otherwise have been antedated by the provisional application filing date would become an actual bar to patentability under the non-provisional filing date, and no U.S. patent could be obtained. Furthermore, the opportunity to file for patent protection in certain foreign countries would be lost through the abandonment of a provisional application, even if the public disclosure came after the filing of the non-provisional application, but still within 12 months of the provisional, because some foreign jurisdictions require non-disclosure of the invention up to the date of filing for patent protection.   There are a number of types of non-original non-provisional applications for patent, i.e., those related to another application previously filed. Continuing applications are non-provisional applications filed before the abandonment, issuance, or termination of proceedings in an earlier non-provisional application and comprise one of three distinct varieties. Continuation applications are a species of continuing applications that disclose no new matter, i.e., they contain the same subject matter disclosed in the prior non-provisional application, known as the parent application, and the same invention is claimed. Divisional applications also identical subject matter to the parent, but claim an invention different from that contained in the parent application. Continuation-in-part applications disclose a substantial portion of that disclosed in a parent application, but also disclose new subject matter. Reissue applications relate to the correction of defects in an earlier filed non-provisional patent application. Substitute applications are simply non-provisional applications that are refiled, e.g., following abandonment.   

XI. The basic patent application process

The application process begins with the filing of a patent application in the USPTO. The application may be filed by the inventor, or by a patent attorney or agent acting on behalf of the inventor. Although inventors can represent themselves before the USPTO, those unfamiliar with patent laws and regulations can waive inadvertently their rights or secure a patent that provides only marginal protection for their invention. For this reason, they typically employ the services of a patent attorney or agent.    Both registered patent attorneys and registered patent agents are authorized to practice in patent cases before the USPTO. To qualify for registration, they must demonstrate that they are of good moral character and of good repute, and they must show that they possess the legal, scientific, and technical qualifications necessary to render valuable service to patent applicants. This generally requires that they have earned a degree in science or engineering, or the equivalent, and pass a rigorous examination covering relevant patent statutes, regulations, and treaties, and their interpretation and application by the USPTO.   Patent agents are authorized only to prosecute patent applications before the USPTO. Unlike attorneys, they cannot draft patent assignments or licensing agreements, cannot represent inventors in patent infringement lawsuits, and cannot advise anyone with respect to other areas of intellectual property, such as trademark law, copyright law, or trade secrets.    Because valuable patent rights can be lost through lack of diligence to file, an inventor should file for patent protection at the earliest possible opportunity. There is a definitive statutory time bar to patenting. 35 U.S.C. §102(a) now provides that one is entitled to a patent unless, before the date of filing for a patent, the invention was patented, described in a printed publication, in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention. Under 35 U.S.C. §102(b), however, any such disclosure made one year or less before the effective filing date of a patent application for an invention shall not be deemed a bar to patentability if the disclosure was made by the inventor, a joint inventor, or a third party obtaining the subject matter of the disclosure from an inventor or joint inventor, or if prior to such disclosure, the subject matter of the disclosure had been publicly disclosed already by the inventor or a joint inventor or a third party to whom an inventor or joint inventor had disclosed the subject matter. This statutory time bar is absolute and cannot be cured by any means whatsoever. The purpose of this seemingly harsh statutory provision is to ensure that there is no excessive delay in filing for patent protection – and hence, providing the public with the knowledge of how to make and use the invention – and at the same time, to allow the inventor a reasonable period to evaluate the commercial value of the invention.   Typically, the application must include a complete description of the invention, drawings of the invention if necessary to understand it, and one or more claims defining precisely the proprietary interest in the invention. The description of the invention must be enabling, i.e., sufficiently complete and precise so as to enable one of ordinary skill in the art to practice – to make and to use – the invention. Drawings are typically necessary for apparatus and articles of manufacture, but may not be required for other types of inventions, such as compositions of matter.   The claims define the metes and bounds of the invention. Patents are intellectual property, and like staking a claim in a goldmine, the claims pinpoint what the property over which the claimant believes he or she has ownership.  Claims will be deemed invalid if not supported in the description of the invention, so they must be carefully crafted.   Every non-provisional patent application must be signed by each inventor under oath or declaration declaring that he or she is the author of the invention. A filing fee must also be paid.   After a non-provisional patent application has been filed with all the required submissions, a patent examiner in the USPTO is assigned to review it. The examiner conducts a search of relevant U.S. and foreign patents, as well as publications, to determine whether the invention claimed is new and non-obvious to a person of ordinary skill in the relevant art.    The examiner then typically will issue either a notice of allowance granting the patent, or an adverse decision denying it. If denied, the applicant may request re-examination, and may amend the application, if necessary. Following a final decision by the examiner, the matter may be appealed. If the adverse final decision is based on substantive grounds, the applicant may appeal to the Patent Trial and Appeal Board (PTAB), a quasi-judicial body within the USPTO, and then to the United States Court of Appeals for the Federal Circuit. If the adverse decision is on purely procedural grounds, the applicant must first petition for review by the Commissioner of Patents before proceeding to the federal court system.      

XII. Protecting and enforcing patents

Once a claim has been staked in a patent goldmine, the owner must prevent others from trespassing on his property and helping themselves to the gold. When a patent has been obtained, the ownership of the invention by the patent holder is presumptively valid. The patent holder can then exclude others from making, using, importing, offering for sale or selling the patented invention for the duration of the patent term. Alternatively, the patent holder may elect to license others to make and use the patented invention in exchange for the payment of reasonable royalties.   What enforcement means are available to a patent holder to achieve either of these alternative objectives? Litigation remains the principal mechanism. This makes the enforcement of patents a potentially expensive proposition. Indeed, patent litigation has been referred to as “the sport of kings” because it can be so expensive for the parties involved. The American Intellectual Property Law Association has estimated that an average patent infringement case can cost between $1 and $3 million dollars. While it can be complex and expensive, litigation affords the greatest level of procedural protection, finality, and relief.    Federal courts, namely, United States district courts, have exclusive original jurisdiction to hear patent infringement actions. Other forms of action involving patents – e.g., lawsuits to interpret and enforce patent licensing agreements – may be brought in a state court system and are arguably less expensive. Remedies typically include injunctive relief, i.e., a court order prohibiting future infringement of the patent, and the recovery of damages for past infringement, violations of a licensing agreement, etc.   Disputes involving patents may also be resolved by resort to means of alternative dispute resolution (ADR), such as mediation and arbitration, which can be – but are not always – simpler, less costly and quicker than litigation. In mediation, in which any resolution is strictly a consensual matter between the parties, a neutral mediator chosen by the parties or a court facilitates settlement discussions between them, the objective being to reach a mutually acceptable settlement agreement. Arbitration, by contrast, involves the appointment of one or more arbitrators whose task is to listen to evidence and argument presented by the parties in a simplified adversarial proceeding and make a decision for the parties to resolve their dispute. Arbitration may be binding or not, depending on the desire of the parties. Mediation and non-binding arbitration, if ultimately unsuccessful in avoiding litigation by bringing the parties to a resolution of the dispute, can ultimately result in greater delay and expense for the patent holder.   Certain administrative remedies may also be available to patent holders. Proceedings may be initiated before the United States International Trade Commission (ITC) against foreign companies who violate patent rights. Remedies include the issuance of exclusion orders that bar infringing goods from entering the United States, as well as cease and desist orders to prohibit the sale of infringing goods in the United States. Penalties for violations of such orders can be $100,000.00 per day or twice the value of the goods, whichever is greater. Evidentiary standards for these proceedings, however, are heightened by additional requirements of proof, such as the existence of a domestic industry for the allegedly infringing goods. The proceedings can be complex, and in the initial stages, do not allow for recovery of monetary damages.   Patents are not self-enforcing. The best avenue for enforcement will depend upon a careful evaluation of the particular circumstances and goals of the individual patent holder.