IP IN DEPTH: Losing Confidentiality in Pending U.S. Patent Applications

On November 29, 1999, President Clinton signed into effect the "American Inventors Protection Act of 1999." The Act was promoted as being a major overhaul of the U.S. Patent system and was intended to "advance American technology, strengthen our nation's global competitiveness, and reward inventors on a more timely basis," according to Rep. Howard Coble (R-NC).

One of the less publicized provisions in the Act was that "for a fee paid to the PTO," third parties could request and obtain the file wrapper contents of published, pending patent applications. This provision quietly let the cat out of the bag because, following the goal to go "paperless" and maximize electronic tools, on August 2, 2004, the U.S. Patent and Trademark Office (PTO) announced that anyone with Internet access anywhere in the world could use the PTO's Public PAIR (Patent Applications and Information Retrieval) system to view the file wrapper contents of published patent applications.

As this announcement was made, the file histories of 500,000 published, pending patent applications became available to the general public, and an estimated 300,000 additional applications will be included in the new database annually.

Indecent Exposure

In the PTO's announcement, Jon Dudas, Under Secretary of Commerce for Intellectual Property and Director of the PTO, said, "This will help American industry better target its research and development investments, and be more responsive to the demands of the national and global marketplaces."

Unfortunately, the ability of the general public to review the file wrapper contents of pending patent applications may catch many research institutes, technology innovators, small start-up companies and others with their pants down and fully exposed to their competitors.

Historically, the PTO held patent applications and their file contents in confidence until a patent was granted. In 2003, the average "wait time" for patent applications was over two years, and as much as five years for some "critical technologies," according to the oral testimony of former Under Secretary James E. Rogan. This gave applicants/assignees/investors a substantial amount of time to commercialize an invention, make capital investments and financial decisions, etc., before having to worry about competitors finding out about their new technologies and business directions.

When the PTO maintained the confidentiality of pending patent applications and prevented access to file wrapper contents, competitors could not "design around" inventions that were waiting in the queue to be patented. The time it took for competitors to obtain and conduct the necessary analysis of file wrapper contents in order to safely design around a patented invention after a patent was granted added even more lead time for innovators and companies to commercialize new technologies.

Rather than advancing American technology and strengthening our nation's global competitiveness, making the file wrapper contents of pending patent applications available to the general public prematurely exposes the direction in which legal protection is proceeding during prosecution.

Protecting Yourself

Companies that are concerned about exposing their technologies and their legal protection strategies that develop during the prosecution of pending applications might wish to consider the use of trade secret protection when applicable. Fortunately, newer technologies often involve processes for which trade secret protection is well suited. The risks of failing to maintain trade secret protection should be weighed against the risk of the technology being exposed to competitors by filing and prosecuting patent applications.

For products for which patent protection might be the only realistic protection, applicants should be mindful from the beginning that every change made to the original application, and everything they argue on the record, can be used by competitors to develop competing technologies that may circumvent any patent that is eventually issued. Everything that is given up by claim amendments or argued against during the prosecution of a pending application can provide competitors with strategies to avoid any resulting patent.

A good patent strategy would involve conducting a thorough patentability search to uncover all relevant references ("prior art") related to a given invention, and then draft a claim strategy that avoids the prior art and includes claims encompassing different aspects of the critical features of the invention. The goal of the claim strategy should be to anticipate and avoid prior art rejections so as to limit necessary claim amendments and the use of arguments to distinguish over the prior art-i.e., to limit the contents of the file wrapper.

Michael Gzybowski is a senior attorney with the law firm of Butzel Long. He has practiced in the field of intellectual property for more than 20 years, beginning as an examiner in the U.S. Patent and Trademark Office. He advises clients on all aspects of intellectual property, including writing and prosecuting patent applications. He can be reached at (734) 995-3110 or e-mail .

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