US Inventors Would Be Badly Harmed Under Proposed Patent Rule

A proposed rule from the US Patent and Trademark Office would radically change patent practice in the US. It would ease and expedite the ability for related patents to be stamped out en masse, without considering them on their merits.

The proposal calls for an inventor’s rights in one patent—voluntarily related to a different patent in terms of ownership and term—to be extinguished by an invalidity determination for any claim in the other patent. Nearly 20% of the hundreds of thousands of patents issued in 2023 alone are so related, reflecting the enormous impact of the proposal.

The proposal, released May 10, runs contrary to congressional intent and the realities of US patent litigation. It incentivizes patent challengers to target the weakest claim in one patent to eliminate strong claims in another without having to prove that the strong claims are invalid. If approved, the proposed rule could cause grievous harm to the patent system and American innovation.

Litigation Realities

A single patent application often includes multiple inventions, resulting in numerous related but separate patents. For example, it’s common in the tech industry to obtain a patent to one use of a new technology and a second use in another patent, though the original patent application describes both uses.

Similarly, biopharma companies often obtain claims to different uses of a drug in separate related patents. The related patents generally expire on the same day, other than for any adjustment of term due to government delays in issuing the patents.

For related patents, the patent office often contends that a claim in one application may be obvious in view of another and rejects the first claim for so-called obviousness-type double patenting, or OTDP. Patent owners can obviate that rejection by voluntarily tying the term and ownership of the two patents to one another, such as by filing a terminal disclaimer.

Because related patents generally expire on the same day, inventors routinely file terminal disclaimers to expedite issuance and avoid expense, even when the OTDP rejection has no merit. The US Court of Appeals for the Federal Circuit has recognized that use of terminal disclaimers is a prosecution expedient that doesn’t reflect that any claim is obvious over another.

The patent office’s proposed rule weaponizes this expedient by saying that inventors may only use terminal disclaimers to overcome OTDP rejections if they agree that, if any claim is invalidated in the first patent, all the claims in the terminally disclaimed patent are unenforceable. The rule would as a result render unenforceable claims that aren’t actually invalid, and even claims that bear no relation to the invalidated claim.

Such a result is contrary to the law. Congress has long made clear that each claim in a patent is presumed valid and enforceable, regardless of the validity of other claims of that patent—never mind the validity of claims in different patents. And for well over a century, the US Supreme Court has followed this principle.

The proposal also disregards the realities of patent litigation. The patent office says the proposal “is intended to promote competition” through “lowering the cost” of challenging groups of related patents. In doing so, it attempts to solve a problem that doesn’t exist. The patent office provides no evidence that groups of related patents are routinely asserted in patent litigation or that patents sharing the same patent term deter competition.

Courts already have local rules and procedures that can limit the number of litigated claims while allowing patent owners to add claims that don’t duplicate other claims at issue. Extinguishing patent rights en masse is contrary to law and basic fairness and wholly unnecessary to achieve the patent office’s stated goal.

Widespread Harm

The proposed rule would create a perverse situation where an inventor’s meritorious patent rights can be rendered unenforceable based on a challenge to a single claim in a different patent or even a decision by the patent owner to disclaim that claim to avoid litigating it. It would encourage unnecessary litigation and invite gamesmanship. Infringers could search out the weakest claim in a patent family and challenge the validity of only that claim to destroy other valid claims.

Consider a defendant who is accused of infringing a strong patent. Under the proposal, the defendant need not defeat infringement or validity of that patent but instead challenge a weak claim in a related patent in an inter partes review, or IPR, proceeding.

It doesn’t matter whether the patent put into IPR has relevance to the defendant, or if the defendant infringed the challenged claim. If the defendant wins that IPR (or even if the plaintiff chooses to avoid expense by disclaiming the challenged claim), the strong claims in the other patent are rendered unenforceable.

Few patent owners will want to take that risk. They would be forced to devote resources to disputing the OTDP rejections—no small task. Of the patents that issued in 2023 alone, almost 60,000 had terminal disclaimers. The proposal would prolong already protracted patent prosecution.

For small inventors and companies, the additional cost of prolonged prosecution would make it increasingly prohibitive to obtain patents at all—patents that are critical to obtaining investment and bringing their inventions to the US market.

The PTO should withdraw its proposal, which fundamentally alters US patent practice for no good reason and hurts inventors.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Alyssa Caridis is an Orrick partner focused on tech and life sciences patent litigation and co-chair of the firm’s IP litigation practice.

Clement Seth Roberts is an Orrick partner focused on tech and life sciences patent litigation.

Irena Royzman is an Orrick partner focused on life sciences patent litigation.

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