By Daniel P. Ochoa and Thomas R. Knight
Under U.S. patent laws, the standard enforceable term of a utility patent begins on the day the patent issues and ends twenty years after the earliest effective filing date of the application. Since the expiration is based on the earliest effective filing date rather than the issue date, prosecution time cuts into the enforceable term. However, to the extend the prosecution process is delayed, a portion of the lost term may be salvageable through the U.S. Patent and Trademark Office’s (USPTO) Patent Term Adjustment process.
What is Patent Term Adjustment?
Patent Term Adjustment (PTA) is time added back to the enforceable term of a patent to compensate for USPTO delays during the examination process. The amount of PTA to be added onto the original twenty-year patent term is calculated by adding the days of USPTO delay and subtracting any delays caused by the applicant.
PTA = Days of USPTO Delay – Days of Applicant Delay
The USPTO delays are defined by 35 U.S.C. § 154(b)(1) and are broken into three categories:
When there is overlap between different types of delay, each day is only counted once.
Applicant delays and USPTO delays are both accrued from the filing date of the patent application until the issue date of the patent. Applicant delay is defined in 35 U.S.C. § 154(b)(2) as “the period of time during which the applicant failed to engage in reasonable efforts to conclude prosecution of the application.” Applicant delays can occur for a variety of different reasons set forth in 37 C.F.R. §1.704, including responding more than three months after receiving an Office Action, filing a Request for Continued Examination (RCE), and/or submitting an Information Disclosure Statement (IDS) after filing an Office Action Response. However, PTA cannot reduce the term of a patent below the original twenty-year term even where the total applicant delay exceeds the USPTO delay (the PTA will default to zero).
The PTA is automatically calculated by the Patent Office and provided with the Issue Notification.
Patent Term Adjustment Errors
While the calculated PTA is typically correct, there are situations where applicant delay may be inaccurately calculated thereby causing the patent to prematurely expire. An error can have a substantial impact on the value of a patent. For example, in Supernus Pharmaceuticals v. Iancu, Supernus was charged 546 days of applicant delay for submitting an IDS after filing an RCE, despite the fact that the reference submitted in the IDS was only made available 100 days before the IDS was filed. On appeal, the Federal Circuit held that the USPTO’s PTA reduction of 546 days was improper where Supernus could not have engaged in any effort to further prosecution. The applicant delay for the late filing of the IDS was limited to a maximum of 100 days, and thus 446 days of enforceable patent term were reclaimed.
In response to the decision in Supernus, the USPTO revised the rules for calculating PTA to specify that the applicant delay should correspond to “the period from the beginning to the end of the applicant’s failure to engage in reasonable efforts to conclude prosecution.” Unfortunately, the Patent Application Locating and Monitoring (PALM) system used by the USPTO to determine PTA may lack the information needed to properly make such a calculation. Events occurring outside of the USPTO (e.g., events in the European Patent Office, as in the case of Supernus) are not recorded in PALM. Thus, the USPTO may be unable to determine when there are no actions that an applicant could reasonably take to bring prosecution to a close and the burden falls on the applicant to verify that the PTA assigned to the patent is correct.
Challenging the Patent Term Adjustment
To reclaim PTA lost due to inaccurate applicant delay calculations, the patent holder must file a request for reconsideration of the Patent Term Adjustment identifying the relevant facts and dates. The request for reconsideration of the PTA must be filed with the corresponding fee (currently $210), and the deadline for filing the request is two months from the patent’s grant date. This time period, however, is extendable by up to five months with payment of additional extension fees.
Maximizing the PTA awarded to a patent is especially important when the claimed technology is expected to maintain its value well into the future. This is particularly true for patents relating to biotechnology, pharmaceuticals, electronic communications, and other technologies for which commercialization may occur long after the patent application is filed. It may also be advisable to review PTA calculations for patent applications with co-pending applications in foreign jurisdictions. As seen in Supernus, such a situation may result in PTA calculation errors that improperly cut months – or even years – from a patent’s enforceable term.
Confirming the USPTO’s PTA calculation can be an involved process, and thus requires balancing the cost versus the potential gain of extending the patent term. As such, please let your attorney at Andrus Intellectual Property Law know if you would like this service performed in conjunction with receiving a granted patent.
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