Prior User Rights
The AIA requires the Office to submit to Congress a report comparing patent laws, most notably prior user rights, of the United States and other industrialized countries. The report was in response to concerns regarding the America Invents Act’s extension of the prior user rights defense to all technologies, not just methods of conducting business, as was the pre-AIA limitation. The America Invents Act still provides for a number of limitations on when the defense can be raised. One of which is the requirement that the party raising the defense proves, by clear and convincing evidence, commercial use at least one year prior to the filing date of the patent application.
The report includes analyses of the effect of prior user rights on innovation rates; small businesses, universities, and individual inventors; and start-up enterprises. The effect of prior user rights on the ability to attract venture capital to start new companies was investigated as well. The report also contains an analysis on issues that arise from placing trade secret law in patent law and a determination if prior user rights are needed in a first-to-file patent system.
Submitted to Congress in January 2012, the Office reported a number of interesting findings. First, the new scope of the prior user rights defense contains limitations to ensure the patentee’s rights are not unjustly impinged, the defense cannot be raised against a university, and innovation is not negatively impacted. Second, the study also revealed there is no substantial evidence showing the prior user rights defense will negatively impact venture-capital investments to small businesses or negatively impact independent inventors. Third, the report reiterated the importance of trade secrets to U.S. businesses and determined the prior user rights defense would protect trade secrets. Forth, it determined the prior user rights defense in a first-to-file system corrects the inherent inequality that arises between a prior commercial user and a later patentee. Finally, the report highlighted the preference for the U.S. to award its businesses the same advantages regarding the prior user rights defense as most industrialized countries afford their businesses.
The Office recommended that the prior user rights defense expanded in the America Invents Act not be altered for it is expected to meet all goals established by its enactment.
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This report was submitted to Congress in January 2012.