Strategic Plan > Index to Action Papers > Simplification of Patent Term Adjustment

Action:

Patent term adjustment should be simplified by providing that an applicant is not entitled to patent term adjustment unless the USPTO fails to issue the patent within three years from the date the applicant requested examination.

Background Information:

The patent term adjustment (PTA) provisions of the American Inventors Protection Act of 1999 (AIPA) allow for term adjustment:  (1) if the USPTO fails to initially act on an application within fourteen months of its filing date; (2) if the USPTO fails to respond to a reply or appeal by applicant within four months of the reply or appeal; (3) if the USPTO fails to act on an application within four months of a Board of Patent Appeals and Interferences (BPAI) or court decision in an application containing allowable claims; (4) if the USPTO fails to issue a patent within four months of the date the issue fee was paid; (5) if the USPTO fails to issue a patent within three years of its filing date; (6) if issue of a patent was delayed due to imposition of a secrecy order; (7) if issue of a patent was delayed due to an interference proceeding; or (8) if the issue of a patent was delayed due to successful appellate review.  This PTA smorgasbord requires the USPTO and applicants to monitor numerous events during the prosecution of the application to determine the appropriate term adjustment, and often results in applicants obtaining patent term adjustment despite the fact that the patent has an unadjusted term of longer than seventeen years from grant.

The purpose of the patent term adjustment provision in the AIPA was to guarantee that diligent applicants would still have a patent term of at least seventeen years from grant under the twenty-year patent term system.  If the USPTO issues the application within three years from its filing date, any patent term adjustment operates to overcompensate the patentee.  PTA should be limited to the situations in which the USPTO delayed processing or examination of the patent and this delay resulted in the application pending before the USPTO for more than three years.

Options Considered:

Option 1:

The USPTO would limit the grounds for receiving patent term adjustment to the USPTO's failure to issue the application within three years from the actual filing date of an application filed under 35 USC 111(a), and the date of fulfillment of the requirements of 35 USC 371 in a Patent Cooperation Treaty (PCT) international application.  The term of the patent would be adjusted one day for each day after the end of the three-year period until the patent is issued.  The period of adjustment under 35 U.S.C. § 154(b) would be reduced by any period of further examination pursuant to 35 U.S.C. § 132(b) (request for continued examination (RCE) filing) and any period of appellate review by the BPAI or by a Federal court, except if the patent was issued under a decision reversing an adverse determination of patentability.    

Advantages:

By removing some of the mandates of 35 U.S.C. § 154(b), the USPTO could eliminate some of the PTA calculations that presently are necessary.  Moreover, by limiting patent term adjustment to guarantees of issuing the application within three years (subject to exceptions for RCE and unsuccessful appellate review) the USPTO would remain consistent with Congressional intent to guarantee diligent applicants a seventeen-year term (from grant) if they are not claiming priority to an earlier filed application.

Option 2:

The USPTO would eliminate patent term adjustment (except for applications raising national security concerns) and provide that if an application has been pending three years from the actual filing date of an application filed under 35 USC 111(a), and the date of fulfillment of the requirements of 35 USC 371 in a PCT international application), the applicant may request that the USPTO immediately issue a patent that contains all of the claims pending at the time of such request.  The USPTO would provide "further examination" of such patents that track the examination process, except that the scope of the claims could not be enlarged through the process.  The patentee would have to pay for further examination and when the examination process is excluded, the USPTO would issue a reexamination-like certificate at which time the patent would be entitled to a presumption of validity.  Moreover, reexamination would be unavailable to a patent undergoing "further examination" before a certificate is issued and the patent will be considered surrendered by operation of law and further examination terminated if the application files a reissue patent (e.g., to enlarge the claims) before a certificate is issued (to avoid complex proceedings).     

Advantages:

By providing applicants with an option to have the patent issued three years after the date the applicant requested examination, applicants are providing industries who would not be concerned with an adjustment at the end of the patent term an option to enforce the patent earlier in the process.  By issuing the patent, industries could seek to enforce the claims at the time of the request (albeit without the presumption of validity) and in addition, continue the examination process to conclude with the issuance of a reexamination-like certificate, and if the certificate indicates granted claims, a patent that is presumed valid.  The USPTO in return would be removing many of the administrative burdens of the AIPA concerning patent term adjustment.

Option 3:

The USPTO would only amend the existing patent term adjustment provisions to make patent term adjustment determinations a post grant activity. 

Advantages:

This option makes changes that would be necessary to make patent term adjustment determination a workable process.

USPTO Recommended Course of Action: 

Explore the options considered with the small business community and other key stakeholders.

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