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New CAFC Decision on Patent Term Adjustment
Douglas A. Miro and David J. Torrente - 1/9/2010
On January 7, 2010, the Court of Appeals for the Federal Circuit decided Wyeth and Elan Pharma v. Kappos (Appeal No. 2009-1120). The case centered around the Patent Term Adjustment (PTA) provisions of the patent statue. The practical effect of this ruling is that the PTA due to patent applicants in many cases will be extended. Attorneys and Applicants should closely examine and recalculate any PTA indicated by the Patent Office.
When Congress implemented the GATT Treaty provisions that measure patent term as 20 years from the earliest claimed priority date, compared to the prior term of 17 years from date of issue, it included provisions to protect Applicants from losing patent term to administrative delays at the PTO. The PTA statute provides day-for-day term extension where 1) the PTO delayed in acting promptly on an application; 2) the Application was held pending more than 3 years; or 3) grant of the application was delayed by appeal, interference, or secrecy order. Any applicant delays (e.g., petitions for extension of time) were offset against PTO delays. In the case where delays 1) and 2) overlap, the statute states that the extension shall be no more than the actual delay. Defining ‘overlap’ of the two provisions was at issue.
In the case where an application suffered delay from both provisions 1) and 2) of the PTA statue, the PTO adopted a policy to grant the greater of the PTO delay (provision 1) or days beyond 3-years pending (provision 2), then subtract any Applicant delay.
Wyeth argued that, for example, if an application suffered 1 year of PTO delay during the first three years of pendency, then received a patent after four years pending they should be entitled to two years of PTA, where the PTO would have awarded only one. The PTO calculation method would have reduced the PTA by one year as allegedly ‘overlapping’, even though none of the PTO delay occurred during the time beyond three years from filing. According to Wyeth, accepted by the court, the provisions only overlapped, requiring downward adjustment, where the PTO delays (provision 1) also occurred after the application had been pending three years (provision 2). Therefore, under Wyeth’s rubric, the delay should be calculated as the sum of delays under provision 1 and 2, less that portion of provision 1 occurring after the three-year mark (limitation on overlap), and less any Applicant delay. Wyeth prevailed at the Washington, DC District Court, whose decision was affirmed by a unanimous panel of the CAFC.
The PTO issues a calculation of Patent Term Adjustment with every Notice of Allowance, and the details of this calculation are available online through the PAIR system. This available raw data of the PTA calculation, or alternately a consideration of the prosecution history itself, can illuminate a greater PTA due than the one calculated under the PTO existing rubric. Contact Ostrolenk Faber if you would like to find out if your patent has the proper PTA.
The full text of the decision is available at http://www.cafc.uscourts.gov/opinions/09-1120.pdf.