Recent U.S. Case Law Affecting Calculation of Patent Term
Patentees in the United States may obtain valuable additional time for their U.S. patents in compensation for certain delays during prosecution. But pitfalls exist for the unwary that can cut into this extra term. Recently, practitioners were surprised by a case applying a legal doctrine known as obvious-type double patenting ("ODP"). Instead of providing lucrative additional patent term in this case, the added term had disastrous effects for the patentee.
In In re Cellect, the Federal Circuit upheld a decision by the Patent Trial and Appeal Board ("Board") finding claims unpatentable for ODP over reference patents in the same family. ODP prevents a patentee from having two patents that, while not claiming the same invention, have claims that are "patentably indistinct," such as obvious variations of the same invention. The rationale being that, upon expiration of the patent, the public expects to be free to use the claimed invention and obvious modifications or variants.
One common tactic for avoiding ODP is to file a terminal disclaimer on the later-expiring patent to have that patent expire on the same date as the earlier-expiring patent.
In this recent case, the challenged patents claimed priority to the same application and would have expired on the same date had some of the patents not received additional term through patent term adjustment ("PTA"). The Board found that the patents claimed obvious variants and applied ODP despite the fact that the patents all derived from the same original filing. By the time the patents were in litigation, the reference patents had expired. Thus, the patentee could no longer cure the ODP problem by filing terminal disclaimers to save the challenged patents.
In applying Cellect, judges have come to opposite conclusions on how far it should reach in terms of timing. In particular, Cellect did not address the question of whether a patentee should be penalized if an earlier-filed application obtains PTA but then a continuing application is filed where the examiner does not delay prosecution, so no PTA accrues. In Delaware, one judge held that "the first-filed, first-issued distinction is immaterial," meaning it does not matter for ODP purposes whether a patent with PTA was filed before or after the reference patent without PTA, as "Cellect recognizes no exception to the rule it announced" for first-filed patents. Allergan USA, Inc. v. MSN Labs. Pvt. Ltd., No. 19-1727-RGA (D. Del. Sep. 27, 2023). However, a different judge in the same court came to the opposite conclusion in another case. Acadia Pharm. Inc. v. Aurobindo Pharma Ltd., No. 20-985-GBW (D. Del. Dec. 13, 2023).
Both cases have been appealed. The Cellect decision may yet be reviewed by the U.S. Supreme Court. We expect to gain clarity as the case law develops on appeal.
In the meantime, however, as you develop your company's global patent strategy, we recommend keeping in mind the following strategies.
Global Patent Strategies
Plan claims during prosecution to draw restriction requirements and invoke safe harbor. When pending claims are directed to independent and distinct inventions, the patent examiner will issue a restriction requirement. This provides an opportunity to file a divisional. If a divisional is filed, 35 U.S.C. 121 provides a "safe harbor" against ODP rejections. In an international patent application, consider including claims to all inventions for which you anticipate seeking patent protection so that it will draw a restriction requirement when the application enters the national stage in the U.S.
Decision-making authority over patent prosecution in collaborations and licenses. Cellect heightens the risk that a collaboration or license partner's patent prosecution decisions will jeopardize the other partner's patent term. Careful consideration should be given to what rights each party will have to make decisions arising from the collaboration and licensed patents, including whether to pursue patents, file continuations, and terminal disclaimers.
Pursuing additional patents following issuance of a parent patent should be carefully considered. Maintaining continuations is a common practice to allow flexibility in obtaining more tailored claims later. Where an issued patent has received PTA, carefully consider whether to allow children to issue. The risk of invalidation via ODP or loss of additional term through a disclaimer filed in the issued patent should be carefully weighed in light of recent case law in this area.
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