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An Opinion on the Issues with First-to-File

Posted by: In: Uncategorized 24 Mar 2013 Comments: 0 Tags:

On Saturday, March 16, the America Invents Act (AIA) became effective. The most critical change under the AIA is the shift from a first-to-invent patent system to a first-to-file patent system. There are two potential issues that I see with the change. First, the new law encourages disclosure that might preclude patents in foreign jurisdictions. Second, first-to-file will likely disadvantage the individual inventor.

The U.S. had operated under a first-to-invent system since the first Patent Act was passed in 1790. Under the first-to-invent system, the true inventor was given the first shot at obtaining a patent, even if another inventor filed prior to him. Now, under the first-to-file system, the inventor can’t just be the first to invent, but also has to be the first to file a patent application with the USPTO.

The most prevalent justification given for the switch to a first-to-file system is to bring the U.S. patent system in line with foreign systems, all of which are first-to-file. This is supposed to make it easier to file across several jurisdictions, but, in my view, it might makes things more difficult. In the U.S., the first-to-file system comes with an exception – prior disclosure. Assume I invent a widget and file my patent in May 2013. Meanwhile, Bob invents the same widget, but manages to file in April 2013. Under the AIA, Bob would get the patent because he filed first. But, if I had disclosed my widget in January 2013, Bob would be out of luck. My disclosure kicked off the one year “grace period” that exists under the law, giving me until January 2014 to file my patent application. So, the new first-to-file system is not truly first-to-file; it is a first-to-file system with exceptions.

Congress likely felt that the disclosure exception would make the first-to-file system more “fair” to those who had invented the same idea earlier. But, in reality, it complicates things if you also plan to file abroad. In most foreign jurisdictions, prior disclosure will preclude patentability. So, the act of disclosure that saved my patent in the U.S. actually destroyed my ability to obtain a patent abroad. Therefore, with the new law in place, inventors will have to decide whether to disclose immediately to start the grace period clock or risk non-disclosure until filing in a foreign jurisdiction.

Not only does the new first-to-file system actually complicate foreign filings, it puts the individual inventor at a disadvantage. Individual inventors do not have a patent attorney on retainer, but most large corporations have entire departments full of patent attorneys waiting to file applications. Corporations can afford to file a patent immediately if necessary without worrying about whether the invention is really ready for patenting. If it turns out the concept has changed, the corporation can afford to file a new patent and abandon the first. Most individual inventors can afford just one shot at obtaining a patent and cannot abandon application after application while they perfect their idea. The asset individual inventors usually need the most is time, and the switch to first-to-file has taken time away from them. I will be interested to see how many patent applications are ultimately abandoned because they were filed too early and whether the number of applications filed by individual inventors decreases.

There are some provisions in the AIA that I think are positive, but the switch from first-to-invent to first-to-file is not one of them. There are many reasons why the U.S. has historically been considered an innovative country; hopefully, the switch to first-to-file did not eliminate the most important reason.

– Suzy Fitzgerald

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