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

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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