Simple Tips For Maximizing Patent Term Adjustment (PTA)

There are several simple strategies that patent applicants should follow to maximize the patent term adjustment allocated to an issued patent. The following list of examples is not exhaustive but includes the events that cause reductions in PTA and that can most easily be avoided. Although PTA is not always a major consideration for a patent owner, one can never tell in advance which patents will be economically significant throughout their life, and when PTA will be important. Therefore, it is prudent to consider the following issues when prosecuting any domestic patent application before the United States Patent and Trademark Office (USPTO).

1. Avoid filing an RCE within three years of the filing date of the application.

Under 35 USC 154(b)(1)(B), the term a U.S. patent may be extended by PTA if the USPTO fails to issue the patent within three years. Section 154(b)(1)(B)(i) states that this provision of the PTA rules does not include "any time consumed by continued examination of the application requested by the applicant…" The USPTO has taken the position that Section 154(b)(1)(B)(i) prevents PTA from accruing at any time after an RCE is filed.

However, two U.S. district courts have recently held that 35 USC 154(b)(1)(B)(i) only applies if an RCE is filed within three years of the filing date of the application. Recently, a third U.S. district court has issued a decision agreeing with the USPTO interpretation of the statute. The issue has been appealed to the Court of Appeals and is awaiting decision by that court.

If the court rulings which disagree with the USPTO are affirmed, there is a significant advantage if the filing of an RCE can be delayed until more than three years after the filing date of an application. Accordingly, if an RCE is warranted, and the application has been pending for slightly less than three years, it is prudent to avoid filing an RCE within three years of the filing date, in case the district court decisions disagreeing with the USPTO interpretation are upheld on appeal.

2. Closely monitor USPTO calculations of PTA in issued patents.

Some commentators have argued that the USPTO frequently makes mistakes in calculating PTA. Furthermore, as discussed above, two Federal district courts have recently ruled that the USPTO is not calculating the PTA correctly in situations where an RCE is filed more than three years after the filing date of the application. If these decisions are upheld on appeal, there could be significant adjustments due for many issued U.S. patents. More importantly, one of the district courts further held that the patent owner was not entitled to any “equitable” extension of the two month nonextendable deadline set forth in 37 CFR 1.705(d) or the 180 day nonextendable deadline set forth in 35 USC 154(b)(4)(A) for applying for reconsideration of the PTA.

Accordingly, if you have any patents granted within the last 180 days, the PTA awarded by the USPTO should be reviewed, especially if an RCE was filed more than three years after the filing date of the application. If recalculation is warranted, you must file such a request within the deadlines set forth above.

3. Avoid requesting extensions of time.

In addition to the "Guarantee of no more than 3-year application pendency" provided in 35 USC 154(b)(1)(B), which is discussed above, 35 USC 154(b)(1)(A) provides for PTA for Patent Office Delay. Patent Office Delay has been defined to include, among other things, not issuing an Office Action within preset periods of time. However, the period of PTA awarded because of Patent Office Delay is reduced by any period of time considered to be Applicant Delay. Applicant Delay, as defined in 35 USC 154(b)(1)(C), includes any period of time greater than three months that the applicant takes to respond to an Office Action. Accordingly, whenever possible, a response to an Office Action should be filed within three months of the issuance of an Office Action to avoid creating Applicant Delay.

4. Promptly file an IDS.

As authorized by 35 USC 154(b)(1)(C)(iii), the USPTO has issued regulations that define certain acts as constituting Applicant Delay, which is used to reduce PTA. Among other acts, 37 CFR 1.704(c)(8) states that submission of a supplemental reply or other paper (which includes an IDS), after a reply has been filed to an Office Action, shall reduce PTA for a period equal to the number of days between the filing of the reply and the subsequent submission of the other paper. Reduction of PTA is also authorized by 37 CFR 1.704(c)(6) if an IDS is filed less than one month before the mailing of an Office Action or a Notice of Allowance and the IDS requires the mailing of a supplemental Office Action or a supplemental Notice of Allowance. 37 CFR 1.704(c)(10) requires a reduction of PTA if an IDS is filed after the issuance of a Notice of Allowance. In addition, 37 CFR 1.704(c)(9) requires a reduction of PTA if an IDS is filed after the issuance of a decision on an appeal.

However, 37 CFR 1.704(d) provides that the filing of an IDS will not constitute Applicant Delay if the IDS is accompanied by a statement that each item of information in the IDS was first cited in a communication from a foreign patent office in a counterpart application and that the communication was not received by an individual subject to the duty of disclosure under 37 CFR 1.56 more than 30 days prior to filing the IDS. The USPTO interprets this section such that a foreign associate that was actively involved in preparation and/or prosecution of the application is considered to be such an individual. However, a foreign associate that simply filed the application in his or her country at the request of the applicant, and who did not provide substantive advice concerning the preparation of the application or prosecution of the U.S. application, is not considered such an individual for the purposes of calculating the 30 day time limit in 37 CFR 1.704(d).

For example, consider the situation where an applicant based in the U.S. directs U.S. counsel to prepare, file and prosecute an application in USPTO and in certain foreign countries. If the U.S. counsel expressly reserves from the foreign counsel all decision-making authority as to prosecution of the U.S. and foreign applications, then the foreign counsel is not considered such an individual for the purposes of calculating the 30 day time limit in 37 CFR 1.704(d).

Accordingly, to avoid unnecessary reduction of PTA, any information in a communication from a foreign (non-U.S.) patent office in a counterpart application that is to be submitted as an IDS in a U.S. application should be reported to the U.S. attorney as quickly as possible and preferably before 30 days after receipt of the communication.

5. Clean up minor issues early during prosecution.

According to 37 CFR 1.704(c)(10), Applicant Delay, which will be used to reduce any PTA, is also caused by the submission of an amendment under Rule 312 or other paper (such as formal drawings) after the issuance of a Notice of Allowance. Accordingly, if there are minor issues in a pending application, including the submission of formal drawings, they should be corrected as soon as possible and preferably before the issuance of a Notice of Allowance.

6. Call the USPTO to correct errors in a Notice of Allowance.

If there are any errors in a Notice of Allowance, Applicant's attorney should try to correct such errors via a telephone call to the USPTO, rather than filing a written request. According to the USPTO, such a telephone request does not constitute Applicant Delay, whereas a written request will constitute Applicant Delay.

For further details concerning ways to avoid PTA, please consult with your U.S. representative.