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Transitional Program for Covered Business Method Patents

Effective Date

Question CBMR1010: What is the effective date for the covered business method review provision in the AIA?

The effective date for the covered business method review provision in the AIA is September 16, 2012.

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Availability

Question CBMR2010:  How long will covered business method reviews be available?

The AIA provides that the covered business review provision sunsets after 8 years from the effective date of the provision.  Accordingly, the Office will not accept new petitions for covered business method review filed on or after September 16, 2020. 

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Eligibility

Question CBMR3010: What patents are eligible for a covered business method review?

A covered business method review is available for all patents issuing from applications subject to first-inventor-to-file provisions of the AIA as well as those patents issuing from applications subject to the first-to-inventor provisions in current Title 35, provided that the patent is drawn to a covered business method.  The AIA specifies that a covered business method patent is a patent that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service, except that the term does not include patents for technological inventions.  The AIA does not specify what a patent for a technological invention covers, and therefore, the Office has promulgated a rule for technological invention.

Question CBMR3020: What is a patent for a technological invention?

In determining whether a patent is for a technological invention, the following will be considered on a case-by-case basis:  whether the claimed subject matter as a whole recites a technological feature that is novel and unobvious over the prior art; and solves a technical problem using a technical solution. 

Question CBMR3030:  How will the Office interpret the term “financial product or service” provided in the covered business method definition?

In administering the program, the Office will consider the legislative intent and history behind the public law definition and the transitional program itself.  For example, the legislative history explains that the definition of covered business method patent was drafted to encompass patents “claiming activities that are financial in nature, incidental to a financial activity or complementary to a financial activity.”  157 Cong. Rec. S5432 (daily ed. Sept. 8, 2011) (statement of Senator Schumer).  This remark tends to support the notion that “financial product or service” should be interpreted broadly. 

Question CBMR3040: Is it the subject matter of the patent or the claims themselves that will be evaluated in determining whether a patent is a covered business method patent?

The definition for a covered business method patent provided in the AIA provides that a covered business method patent is “a patent that claims a method or corresponding apparatus for performing data processing . . . , except that the term does not include patents for technological inventions.”  (Emphasis added.)  The determination of whether a patent is a covered business method patent subject for review therefore will be based on what the patent claims.

Question CBMR3050:   Who bears the burden to demonstrate that at least one claim of the challenged patent is to a covered business method patent and not directed to a technological invention?

The petitioner bears the burden to demonstrate that the challenged patent is a covered business method patent and that at least one claim of the challenged patent is not directed to a technological invention to show that the petitioner has standing to proceed.  The showing for both covered business method patent and technological invention is based on what is claimed.

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Petition for a Covered Business Method Review

Question CBMR4010: Who may file for a covered business method review?

Only a person who is sued or charged with infringement of a covered business method patent may petition for a covered business method review of the patent.

Question CBM4020:  What does charged with infringement mean in the context of a covered business method review?

Charged with infringement means a real and substantial controversy regarding infringement of a covered business method patent exists such that the petitioner would have standing to bring a declaratory judgment action in Federal court. 

Question CBMR4030:  When can a petitioner bring a covered business method review for a patent?

A covered business method review may be requested except during the period in which a petition for post-grant review could be filed, e.g., 9 months after the issuance of a patent that is subject to the first inventor-to-file provisions.  The transitional review program is available for non-first-to-file patents, even within the first nine months of the grant of such patents.

Question CBMR4040:  On what grounds may a petitioner challenge a patent in a covered business method review?

A petitioner for covered business method review may request to cancel as unpatentable one or more claims of a covered business method patent granted under the first-to-file provisions of the AIA on any ground, but limited prior art shall apply for those challenged covered business method patents granted under the first-to-invent provisions of Title 35.

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Trial

Question CBMR5010:  How will covered business method reviews be conducted?

Generally, the AIA provides that covered business method reviews will employ the standards and procedures of a post grant review, subject to certain exceptions such as the grounds for challenge and the scope of estoppel.

Question CBMR5020: How long will a covered business method review take?

A covered business method review is statutorily required to be complete within one year of institution, except that the time may be extended up to six months for good cause. 

Question CBM5030:  How will the Board conclude a covered business method review?

Like in a post grant review, where a covered business review is instituted and not dismissed, the Board shall issue a final written decision.  The decision shall address the patentability of any challenged patent claim and any new claim added via amendment during the covered business review.

Question CBM5040:  May a party request rehearing of the final written decision?

Yes, either party may request rehearing of the Board’s decision.  The request must specifically identify all matters the party believes the Board misapprehended or overlooked, and the place where each matter was addressed in the petition.

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Estoppel

Question CBMR6010:  After the Board renders a final decision in a covered business method review, do any estoppels apply against the petitioner?

Yes, a petitioner in a covered business method review may not request or maintain a subsequent proceeding before the Office with respect to any claim on any ground raised or reasonably could have been raised in the covered business method review.  By contrast, a petitioner in a covered business method review may not assert in a subsequent district court or ITC action that a claim is invalid on any ground that the petitioner raised. 

Question CBMR6020:  After the Board renders a final decision in a covered business method review, do any estoppels apply against the patent owner?

Yes, a patent owner is estopped from taking action inconsistent with any adverse judgment including obtaining in a patent a claim that is patentably indistinct from a finally refused or cancelled claim or amending its specification or drawing in a way that it was not permitted to do during the proceeding.

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Appeal

Question CBMR7100:  Can a party to covered business method review appeal the Board’s final decision?

Yes, a party dissatisfied with the final written decision in a covered business method review may appeal to the Federal Circuit.

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Other

Question CBMR8010:  How will the Board handle multiple proceedings for the same patent, such as two or more covered business method reviews on the same patent?

Where another matter involving the same patent is before the Office during the pendency of the covered business method review, the Board may enter any appropriate order regarding the additional matter including providing for the stay, transfer, consolidation, or termination of any such matter.  Joinder may be requested by a patent owner or petitioner.

Question CBM8015:  How does the Patent Trial and Appeal Board handle conflicting case law?

The Board considers and applies the precedent of the Federal Circuit and the Supreme Court to the facts of the particular cases before it.  The Board strives to decide cases following the closest precedent.  The Board looks for guidance from Supreme Court precedent when Federal Circuit decisions do not provide guidance on a particular issue.

Question CBM8018:   What is the Patent Trial and Appeal Board doing to provide a level playing field in their trials involving independent inventors and small companies?

During rulemaking, the Board received and took into account comments from the public, including independent inventors and small companies.  The Board’s proceedings are intended to provide a quicker, less expensive alternative to district court patent litigation.  Discovery is limited and deadlines are established for the completion of trials.  The Board believes this is to the benefit of all parties, including independent inventors and small companies.

Question CBMR8020:  Can the parties to a covered business method review settle?

Like in a post grant review, parties to a covered method patent review are permitted to settle.  A settlement terminates the proceeding with respect to the petitioner, and the Board may terminate the proceeding or issue a final written decision. 

Question CBMR8030:  Can a party to a covered business review be sanctioned?

Yes, the AIA requires the Office to prescribe sanctions for abuse of discovery, abuse of process, or any other improper use of the review, such as to harass or cause unnecessary delay or an unnecessary increase in the cost of the proceeding.

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Last Modified: 12/11/2013 4:49:19 PM