Glaxo Wins Round One in Lawsuit Against the U.S. Patent Office—Early Victory for Biotech and Pharma

11/1/07

Talk about the eleventh hour. At the last possible moment, a federal district court in Alexandria, VA, handed down a ruling yesterday evening that—at least for now—blocks new U.S. Patent Office rules that had been scheduled to take effect today: November 1, 2007. The new rules would have, among other things, made it harder for companies with pending patents to file so-called “continuations” that elaborate on their discoveries.

Continuations are favored, especially by biotech companies and university tech transfer offices, because they allow applicants to file patents early in the life of an invention or discovery—when not all the details of the invention are clear—and then add new claims that clarify and elaborate on them as they are pending. The Patent Office, which now faces an unprecedented backlog that is aggravated by such continuations, has contended that the new rules, which were finalized in August, are needed to streamline and speed up the patent process.

In the preliminary injunction, the court granted pharmaceutical giant GlaxoSmithKline’s motion to block the new rules, agreeing that the rules would likely do irreparable harm to the roughly 100 patents Glaxo has pending at the U.S. Patent Office. By granting an injunction, the court also signaled the likelihood that the U.S. Patent Office might well lose the case. Glaxo has argued, among other things, that the Patent Office has exceeded its authority in the new rules, especially by making them apply retroactively to pending patents. A full ruling is unlikely before hearings on the matter resume in December.

The prospect of the patent office’s rule change had already sent patent lawyers around the country scurrying on behalf of their clients, and the latest injunction just adds more chaos to an already uncertain climate in the patent world. As Michael Siekman, a patent attorney at Wolf, Greenfield & Sacks in Boston, explained in an email, the ruling took many in the field by surprise. Most close observers, Seikman says, thought it “unlikely that a court would stop an executive agency from implementing its rules on a relatively arcane subject when the court was not even going to hear the case until the day before the rules were to go into effect.”

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  • John

    The Patent Office indeed has an unprecedented backlog. However, it is also disputed whether continuations aggravate the backlog – the conventional wisdom outside the government is that this hypothesis is the unfounded conjecture of a few inexperienced academics that are, unfortunately, influential at the Patent Office. “Continuations” have been a fundamental part of the U.S. patent process used by small to medium size businesses, in all industries, for different reasons, probably for a hundred years. They are most often a workaround for USPTO competence problems. Mammoth electronics multinationals need continuations less because they do thousands of yearly filings rather than twenty or fifty (thus protecting their IP by a “throw spaghetti against the wall” principle unavailable to smaller entities). The USPTO plan is widely recognized as having little connection to causation or efficacy, increasing the cost for all applicants by literally multiples, driving smaller entities into the regime of trade secret protection, and having a likely effect of shifting most of the backlog from “continuations” to “appeals.” Several amicus briefs went against the USPTO; none in their favor.

  • wesley

    “submarine patents” ended in 1995 when strict term limits were placed on patents — 20 years, no matter how many continuations

    patents also are published with few exceptions 18 months afer filing — so the rest is a bunch of red herrings

    the patent system, like our american democracy, enables individual inventors to challenge the status quo — as with any individual rights that may be contested — it is our industrial policy and the only means for individuals to push the envelope of innovation forward

    dont kid yourself with all of the nonsensical spin that this will help anyone but the alleged “coalition for patent fairness”

    there has been no percentage change in the amount of litigation and the “coalition” does plenty of the things they allege of others

    even ibm changed their position at the last minute — 14 years as the largest patent filer … the more things change

    must read::

    The Patent Reform Act of 2007: Responding to Legitimate Needs
    or Special Interests? The “Patent Fairness” Issue An Analysis
    by Pat Choate, Ph.D.
    Manufacturing Policy Project

  • David Resnick

    The patent office admits that the proposed rules only deal with 3% of the its cases. By limiting the “bits at the apple” the PTO gets the leverage to it needs to force applicants to limit the scope of their patent, the true purpose of the rules. The real problem is the PTO’s inability to hire and retain qualified examiners. Instead of requiring patent applicants to pay legal fees to follow complicated, unclear and burdensome rules, they could simply raise the fees for continuation applications and use the money to hire new examiners. That would go a long way towards reducing the “unprecedented backlog.” It would also keep the PTO out of court.

  • http://n/a Peter I. Lippman

    Some FALSE ideas in the PTO’s barrage of purported support for the new rules:

    (1) There is a need to get applications processed through more quickly.
    VERY seldom do applicants benefit from conclusion of their cases more quickly — and in such cases the Petition to Make Special is the solution of choice. Otherwise, years of pendency can save a huge amount of waste motion.

    (2) Anyone gains anything by limiting RCEs.
    (An exception is the rogue examiner who likes to throw weight around by insistent, arbitrary and far-fetched rejections. That kind of examiner gains a major and improper advantage.)
    This point is suggested by the reference in John’s 11/02 post, above, to a “workaround for USPTO competence problems”.
    The routine RCE, only modest in cost (and not requiring deposit of more mountains of paperwork as continuations do), is one of the last bastions of fairness in the system, and should not be limited at all.

    (3) The new rules are merely procedural.
    When followed through to their core, these rules actually inflict substantive harm on inventors’ rights to obtain adequate protection. Dependent claims are our crucial “fallback position”. Bear in mind that a court cannot edit claims but can only declare some valid and some invalid. Therefore proper protection is very often based upon the array of dependent claims, which can provide a full field of definitions of the invention at intermediate breadth, and thereby enable a court to resolve essential disputes painlessly without sending the patentee back to the patent office.