The American Inventors Protection Act includes "provisional
rights," allowing a company to obtain monetary compensation
for use of its invention that occurs prior to issuance of a patent.
Under the old law, filing a patent application could not prevent
another company from using one's invention cost-free, until the
patent application issued into a patent. In other words, during
the period in which the U.S. Patent & Trademark Office (PTO)
was examining the application, another company could use the
invention without accruing expense. This pre-issuance use of
the invention may represent substantial value, as the PTO examination
period may span several years.
In other words, under the old law, one could not infringe
a patent application.
Under the new law, after the patent issues, damages for patent
infringement may relate back to the patent application. The new
law states, a "patent shall include the right to obtain
a reasonable royalty from any person who, during the period beginning
on the date of publication of the application for such patent
. . . makes, uses, offers for sale, or sells in the United States
the invention as claimed in the published patent application
. . . and had actual notice of the published patent application."(footnote 1)
This right, based on a patent application, is called a "provisional
right." This provisional right is tentative and depends
on four conditions. The first condition is publication of the
patent application. Under the new law, the PTO normally publishes
patent applications eighteen months after the application filing
date, but may publish sooner upon request of the owner of the
application. Alternately, the PTO will not publish the application
at all if the owner makes an appropriate request.(footnote
The second condition is notice. In order for the notice condition
to be satisfied, the company from which royalties are to be obtained
must have notice of the published patent application. To satisfy
this notice condition, the owner of the patent application may
wish to engage legal counsel to send a copy of the published
patent application to the other company.
The third condition is issuance of the patent application
into a patent.
The fourth condition is substantial identity between the inventions
in the issued patent and the published patent application; "The
right . . . to obtain a reasonable royalty shall not be available
. . . unless the invention as claimed in the [issued] patent
is substantially identical to the invention as claimed in the
published patent application." (footnote
3)This fourth condition will often be a critical issue,
because the application owner typically changes the claims
during examination of the application. Complicating the issue
is uncertainty as to the meaning of certain language in the new
law, because no court has yet had an opportunity the interprete
the new law. For example, it is currently unclear what kind of
claim continuity is required between the claims of the patent
and the claims of the application. Must the entire set of claims
of the patent be "substantially identical" to the entire
set of claims of the application for any provisional right to
exist? Alternately, does the law allow claim by claim continuity,
merely requiring a single claim to be "substantially identical"
for a provisional right to exist in that claim, even when there
are differences between other claims? Further, what does "
substantially" mean in this context?
As we await judicial interpretation of the new provisional
rights provision, a company with a new invention may wish to
instruct legal counsel to prepare a patent application with at
least some claims for which, the company believes, change will
not be required.
The provisional rights provision of U.S. Patent Law represents
an important new business tool. A company with a commercially
valuable, patentable, invention now has additional leverage over
a competitor seeking to copy the invention. Under the new law,
such a competitor runs the risk of accruing royalty expense before
any patent issues.