Patent Basics for Entrepreneurs October 17, 2014 Michael P. Dilworth, JD Anthony D. Sabatelli, PhD, JD © Copyright 2014

Patent Basics for Entrepreneurs

October 17, 2014

Michael P. Dilworth, JDAnthony D. Sabatelli, PhD, JD

© Copyright 2014

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Overview

1. About Us and Our firm2. Background on Inventions and Patents3. How a Patent Works4. Patent Time Line5. First to File6. Patent Examples and Recent Trends7. Useful Links and Sites

1. About Us and Our Firm

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2. Background on Inventions and Patents

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IP Basics

• What is a patent?

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IP Basics


• What is an invention?

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IP Basics


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IP Basics


An invention is a discovery or idea that is made into a machine, product, or process.

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IP Basics


An invention is a discovery or idea that is made into a machine, product, or process.

An invention is “intellectual property”.

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IP Basics



IP Basics

• What is a patent?• It is a contract – a legal document.


IP Basics



IP Basics

• What is a patent?• A patent describes and “claims” an invention.


IP Basics

• What is a patent?• A patent describes and “claims” an invention.• A patent “protects” an invention.


IP Basics

• What is a patent?• A patent describes and “claims” an invention.• A patent “protects” an invention.• A patent gives an inventor certain rights to his

or her invention.


IP Basics

• What is a patent?• A patent describes and “claims” an invention.• A patent “protects” an invention.• A patent gives an inventor certain rights to his

or her invention.– the right to exclude others from making, using or

selling the invention (more on this later)


A Patent Is Similar To A Deed To A House

• A deed describes and shows ownership of a house – “real property”.


A Patent Is Similar To A Deed To A House

• A deed describes and shows ownership of a house – “real property”.

• A patent describes and shows ownership of an invention – “intellectual property”.


US Patent and Trademark Office

Patents• Patents are issued by the government


US Patent and Trademark Office

Patents• Patents are issued by the government

• The United States Patent and Trademark Office• Located in Alexandria, Virginia (and now some satellite offices)• www.uspto.gov


Constitutional Basis

The Congress shall have 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.

U.S. Constitution, Article I, Sec. 8, Par. 8


The US Patent System Was Established In 1790

• Thomas Jefferson, then as Secretary of State, was instrumental in establishing the US Patent system.

• He was one of the first commissioners of the US Patent Office.

• He was also an inventor.


The Patent as a Contract

• Patents are a contract with the government.

• The inventor discloses how to make and use the invention in the written patent application.

• In return, the inventor receives the right from the government to exclude others from making, using, and selling his or her invention for 20 years.


The Patent as a Contract

• When the patent expires, or when the owner chooses to let it lapse by not paying maintenance fees, the claimed subject matter enters the public domain, and the public benefits from the disclosure.

• The useful arts and the progress of science and technology are promoted by the disclosure, while there would have been little or no public benefit if the inventor chose to keep the invention a secret.


What is patentable?

Any new process, machine, manufacture or composition of matter.

• Examples: Cell phones, computers, and other electronic devices Pharmaceuticals, food additives Jet engines, hockey sticks, golf balls Soaps, cosmetics, tooth paste Chemical manufacturing processes Methods of doing business (?) Methods of conducting research (?) Diagnostics (?) Computer software (?) DNA (no!), cDNA and other biomolecules (yes, for now)


Requirements for Obtaining a Patent3 Requirements

• Utility – the invention must have at least one use.

• Novelty – the invention must be new. It must not have been previously known.

• Nonobvious – the invention must not be “obviousness” over what is already known (the “prior art”).

3. How a Patent Works

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How does a patent work?

Example 1.– Jennifer is an inventor.– She builds a chair (assume that chairs were unkown).– She applies for a patent on her chair.– The Patent Office awards Jennifer a patent.



• Jennifer can now use her patent to exclude others from making, using, and selling chairs, unless she allows them to do so (by granting licenses).

• Jennifer makes a lot of money selling her chairs to other people.

• Some people even pay Jenifer to license her chair patent so that they can make their own chairs.



Example 2.– Paul buys a chair from Jennifer.– He finds the chair very uncomfortable – the back is too

straight.– He builds an improved chain with an adjustable back.– He files a patent. – He is awarded a patent on his adjustable chair.



• Paul can now use his patent to exclude others (including Jennifer) from making, using, or selling chairs with adjustable backs, unless he allows them to do so.

• However, one day, Jennifer sees Paul sitting in his adjustable chair . . .

• What can Jennifer do?



• Jennifer can assert her patent rights.

• She can prevent Paul from making, using, or selling his adjustable chairs . . .

• . . . this is because Paul’s adjustable chairs infringe Jennifer’s dominant chair patent.

• Paul either has to stop making, using, and selling his adjustable chairs, or he must get a license from Jennifer to continue to do so.


Freedom to Operate vs. Patentability

• As seen from these examples, being issued a patent does not give one the right to practice one’s invention.

Freedom to Operate and Patentability are opposite sides of the patent coin.

4. Patent Time Line

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Patent Time Line

FileProvisional Patent

Application$

FileUS Nonprovisonal

and/or PCT Application

$$

PatentApplicationPublishes

Enter NationalStage$$$

0 1 yr 18 mo 30 mo

21 yrs(20 from PCT Appl.)

26 yrs

PatentIssues

PatentExpires

Up to 5 yearsPatent TermRestoration

(drugs)35 USC §156

24 yrs

Up to 3 yearsPatent Term

Adjustment forUSPTO Delays35 USC §154

30 mo 0


Patent Time Line


Application$

0


Patent Time Line


Application$



$$

0 1 yr


Patent Time Line


Application$



$$


0 1 yr 18 mo


Patent Time Line


Application$



$$



0 1 yr 18 mo 30 mo


Patent Time Line


Application$



$$



0 1 yr 18 mo 30 mo

30 mo 0


Patent Time Line


Application$



$$



0 1 yr 18 mo 30 mo

PatentIssues

30 mo 0


Patent Time Line


Application$



$$



0 1 yr 18 mo 30 mo


PatentIssues

PatentExpires

30 mo 0


Patent Time Line


Application$



$$



0 1 yr 18 mo 30 mo


PatentIssues

PatentExpires

24 yrs



30 mo 0


Patent Time Line


Application$



$$



0 1 yr 18 mo 30 mo


26 yrs

PatentIssues

PatentExpires

Up to 5 yearsPatent TermRestoration

(drugs)35 USC §156

24 yrs



30 mo 0

5. First to File

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First to File

• On March 16, 2013 the US went from a first-to-invent to a first-to-file system– America Invents Act (AIA)


First to File Insights

• The US previously awarded a patent to whoever could demonstrate the earlier completion of an invention rather than whoever won the race to file a patent application with the patent office.

• Reverses two centuries of US patent law• Seeks to harmonize US patent law with that of

most other countries



• However, US patent law still uniquely allows a one-year grace period. Thus, an inventor can publish a paper, make a presentation, or otherwise disclose the invention to the public prior to filing a patent application and still be entitled to a patent, provided that the patent application is filed within one year of the disclosure.

• “Publishing ahead” of filing a patent application will prevent anyone else from patenting the same invention anywhere, even if the other is the first to file a patent application.



• “Publishing ahead” sounds like a good idea.• However, most inventors want to preserve not

only their right to a US patent, but also their rights to patents around the world.

• Because most countries require “absolute novelty”, an early disclosure will forfeit patent rights almost everywhere but the US.

• The one-year grace period therefore has limited value.

6. Patent Examples and Recent Trends

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Famous Patents – The Telephone

US Patent 174,465 – Alexander Graham Bell “Improvement in Telegraphy” (1876)


Famous Patents – The Airplane

US Patent 821,393 – Orville and Wilbur Wright “The Flying Machine” (1906)


Famous Patents – Barbed Wire

US Patent 157,124 – Joseph F. Glidden “Wire Fences” (1874)


Famous Patents – The Light Bulb

US Patent 223,898 – Thomas A. Edison “The Electric Light Bulb” (1880)


Famous Patents – The Elevator

US Patent 31,128 – E.G. Otis “Safety Elevator” (1861)


Famous Patents – Aspirin

US Patent 31,128 – F. Hoffmann “Acetyl Salicylic Acid” (1900)


Other Patents – Oil Eating Bacteria

US Patent 4,259,444 – A. Chakrabarty “Microorganisms having multiple compatible

degradative energy-generating plasmids and preparation thereof” (1981)

1. A bacterium from the genus Pseudomonas containing therein at least two stable energy-generating plasmids, each of said plasmids providing a separate hydrocarbon degradative pathway.


The Biotech Revolution is Launched

Diamond v. ChakrabartyLandmark 1980 Supreme Court decision (5-4) finding genetically engineered organisms patentable.

oil-eating bacteria

“anything under the sun that is made by man”

Diamond v. Chakrabarty, 447 U.S. 303 (1980)

“markedly different” from naturally occurring products


Other Patents - Rib-X Pharmaceuticals/Yale University – Drug Discovery Patent

US Patent 6,952,650 – (2005)

A method of identifying a compound that binds to a large ribosomal subunit comprising the steps of:

(1) providing a molecular model having one or more target regions of a large ribosomal subunit from the Haloarcula atomic coordinates . . . or derived therefrom by molecular modeling . . .

(2) identifying a compound that binds to it . . .

(3) and producing the compound.


Fast-Forward to Myriad Genetics

vs.


Basis for Patents and Patentable subject matter

The Congress shall have 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. US Constitution, Article I, Section 8, Clause 8

. . . any new and useful process, machine, manufacture, or composition of matter . . .

35 USC §101

But, there are exceptions . . .


Judicial Exceptions to 35 USC §101

• Laws of Nature

• Natural Phenomena

• Abstract Ideas


The Myriad Decision• Myriad isolated and sequenced the DNA encoding the BRCA 1 and BRCA 2

genes– mutations associated with breast and ovarian cancer

• Obtained patents to isolated DNA, cDNA, diagnostic methods, etc.• In 2009, the ACLU brought suit on behalf of several plaintiffs

– sought invalidation of Myriad’s gene patents• civil rights strategy• legal theory: DNA is a nonpatentable product of nature

• Supreme Court granted review on a single question: Are human genes patentable?

Naturally occurring DNA is not patentable. Synthetically produced cDNA is.

Association for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107 (2013)


Also, the Mayo DecisionPatent claims directed to:

A method of optimizing the therapeutic efficacy of a thiopurine drug for treating an autoimmune GI disorder by:(a) administering the drug, and(b) measuring the level of the drug in the patient, wherein the level

indicates the need to increase or decrease a subsequent dose.

• District Court – the claims recite an ineligible law of nature• Court of Appeals for the Federal Circuit reversed (twice)• Supreme Court reversed (unanimous)

The patent effectively claims an underlying law of nature. Lacking other elements.

Mayo Collaborative Services v. Prometheus Laboratories, Inc., 132 S. Ct. 1289 (2012)


Now, the Alice Corp. DecisionThe USPTO must now grapple with abstract ideas (2014 Guidance in revision).

Alice Corp. has patents directed to:A method of mitigating exposure to “settlement risk” in business transactions.- method claims- computer system for implementing the exchange- computer-readable medium containing program code

• District Court – struck down the patents• Court of Appeals for the Federal Circuit, ultimate affirmed in a highly –fractured 7 opinion

decision• Supreme Court affirms (unanimous)

The patent claims an ineligible abstract idea. Alice Corporation Pty. Ltd. v. CLS Bank International et al., S. Ct. No. 13-289 (2014)


Where are we going?

We live in interesting times as biotech and IT patents continue to be the subject of high-stakes litigation.


Amusing Patents – Leash Umbrella

US Patent 6,871,616 – “Pet Umbrella and Combined Pet Leash and Umbrella” (2005)


Amusing Patents – Plane Boat

US Patent 6,938,852 – “Flying Craft Tethered to Water Vehicle” (2005)


Amusing Patents – Electric Candle

US Patent 6,929,381 – “Solar Powered ElectricCandle” (2005)


Amusing Patents – Cap Watch

US Patent 6,870,796 – “Cap and Timepiece Device” (2005)

7. Useful Links and Sites

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USPTO Website

www.uspto.gov

PATENTS Tab


WIPO/PCT Website

• World Intellectual Property Organization– Administers the Patent Cooperation Treaty (PCT)– www.wipo.org

• Provides a single international application for seeking patent protection in approx. 150 countries

• Good search site for finding both US and foreign patent documents – patentscope

• http://patentscope.wipo.int/search/en/search.jsf


Thank you for your time.

Michael P. Dilworth, JDAnthony D. Sabatelli, PhD, JD

203-220-8496

[email protected]@dilworthip.com

www.dilworthip.com

Documents

Patent Basics for Entrepreneurs October 17, 2014 Michael P. Dilworth, JD Anthony D. Sabatelli, PhD, JD © Copyright 2014