The Federal Circuit May Have Just Lengthened Your Patent Term

    On January 7, 2010, in Wyeth and Elan Pharma v. Kappos, the Federal Circuit identified  the proper method for the United States Patent and Trademark Office (PTO) to calculate patent term extension.   In doing so, the Court sided with Wyeth and Elan, and against the PTO, holding that the different periods of delay for calculating patent term extension only overlap when certain statutorily-identified delays occur after the first three years of prosecution.   Within days, the PTO weighed in again, conceding that it would not seek further review of the decision.

By way of background, in 1994, the law changed the term of issued patents from seventeen years from issuance to twenty years from filing.  Under the old rules, because the term was based on the issue date, Patent Office delays during prosecution had no effect on patent term.  Since 1994, because the term is based on the filing date, Patent Office delays during prosecution can substantially shorten the term.  Via term extension, the 1994 rules prevent an applicant having their term cut short due to certain types of Patent Office delay.

For example, the patent term extension rules codified in 35 U.S.C. §154(b)(1)(A) state that patent term extension is available when the Patent Office does not provide an Office action or Notice of Allowance within 14 months of application filing, when the Patent Office does not respond to a Response to Office action within 4 months, and when the Patent Office fails to issue a patent within 4 months after the date on which the issue fee was paid.  The term of the patent is extended 1 day for each day after the end of the periods above until the Patent Office takes the specified action. 

Additionally, 35 U.S.C. §154(b) (1)(B) states that the Patent Office shall issue a patent within 3 years of filing unless there is delay consumed by continued examination of the application requested by the applicant or other specified delays.  Again, the term of the patent is extended 1 day for each day after the end of the three year pendency until the patent issues.
The rules further specify that to the extent that periods of delay of sections (1)(A) and (1)(B), as discussed above, overlap, the period of any adjustment shall not exceed the actual number of days the issuance of the patent was delayed.  The fight in Wyeth and Elan Pharma v. Kappos centered on the calculation when “periods of delay . . . overlap.”  The PTO’s interpretation of the statute was that the overlap is properly avoided when the term is adjusted only by the greater of (1)(A) or (1)(B).  Wyeth, on the other hand, argued that the periods only overlap when the PTO delays identified in (1)(A) occur after the first-three-years of prosecution have passed.

Both the DC District Court and the Federal Circuit agreed with Wyeth’s statutory interpretation.  Within days of the decision in Wyeth and Elan Pharma v. Kappos, the PTO announced that the PTO will not seek review of the decision.  The PTO again reminded applicants that any applicant or patent owner dissatisfied with a patent term adjustment determination by the PTO must seek review of that determination within 180 days of patent issuance and the time periods set forth in the implementing regulations of 35 U.S.C. §154(b)(4) and 37 CFR 1.705.  Accordingly, PTO patent term extensions calculations need to be reviewed at the time of issuance to allow for time to seek review.  It is unclear whether the patent term extension calculation spelled out by Federal Circuit will be applied retroactively, and this issue will likely be litigated in future cases.
It is also important to note that any patent term extension due to Patent Office delay is reduced by certain types of applicant delay.  For example, 35 U.S.C. §154(b)(2)(C) states that patent term extension is reduced by the cumulative total of any periods of time in excess of 3 months that it takes the applicant to respond to an Office action.  Therefore, repeated delay by applicants or their attorneys can substantially shorten patent term that otherwise would have been extended due to PTO delay.