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Patent Trends of 2024: Legislation, AI & Globalization
It’s the start of a new year, meaning it’s time to make some optimistic predictions about how the next 365 days might unfold. For some, this means throwing all caution to the wind and hoping for the absolute best outcome. For me and others more calculated, this means making some measured projections of how the developments of 2023 might unfold in 2024. Fortunately for all, 2024 has the potential to change and shape patent law and policy in a number of exciting ways. Let’s take a look.
Patents 2024: Reformation via Legislation
Two bills introduced in the Senate last summer look to make big changes in patent policy. The Patent Eligibility Restoration Act (“PERA”), as its name suggests, hopes to reform patent eligibility. The Promoting and Respecting Economically Vital American Innovation Leadership (“PREVAIL”) Act primarily aspires to reform the Patent Trial and Appeal Board (PTAB). Both bills were introduced by Senators Chris Coons (D-DE) and Tom Tillis (R-NC).
Patent-eligible subject matter is governed by 35 U.S.C. 101, and includes “any useful process, machine, manufacture, or composition of matter, or any useful improvement thereof.” As you may notice, that is not a lot of guidance as to what is or is not eligible. For that reason, courts over time have attempted to clarify § 101 by creating their own list of patent ineligible matter, like abstract ideas and natural phenomenon. PERA, brough to the Senate in June 2023, hopes to clarify eligibility even further by eliminating the judicially-created exceptions to eligibility. Instead, a patent will be ineligible only if it falls under one of specifically enumerated categories spelled out in PERA. The point of this new guidance under PERA is not just to reduce confusion, but make patent eligibility in the United States more consistent with other parts of the world.
PERA also aims to eliminate 35 U.S.C. §§ 102, 103, and 112 from the patent eligibility analysis. Instead, whether an inventor has claimed patentable subject matter “shall be determined . . . by considering the claimed invention as a whole” and all of its claim elements. Any consideration of whether the invention new, obvious, or adequately described (§§ 102, 103, and 112) is reserved for determining patentability, rather than eligibility.
Critics of PERA argue that eliminating judicial exceptions and overruling Supreme Court decisions on patent eligibility will permit the protection of weak and overbroad patents. They also argue that the Act permits the patenting of modified genes, which could stifle medical innovation and treatment in that field.
The PREVAIL Act would primarily make it more difficult to successfully challenge issued patents, but also make the challenge process less costly and less uncertain. Consider the following examples:
- PTAB is currently allowed to invalidate a patent based on a “preponderance of the evidence,” i.e., that evidence shows the patent is more likely than not to be invalid. PREVAIL posits a much higher threshold for invalidation. Its “clear and convincing evidence” standard essentially gives a patent a presumption of validity, which PTAB must then refute.
- Current law permits patents challenges to be initiated in multiple venues at once, risking parallel litigation. Under PREVAIL, filing a patent challenge in PTAB or district court immediately estops a petitioner from bringing a challenge elsewhere. Similarly, PREVAIL avoids problems inconsistent rulings across jurisdictions by preventing a patent from being challenged more than once.
- Any party who wants to challenge an issued patent is presently free to do so. PREVAIL would introduce a standing requirement, limiting challenges only to parties who has already been sued or threatened with a patent infringement suit. This change would greatly reduce serial litigation of patents.
Proponents of PREVAIL tend to advocate for strong patent rights and recognize that the Act would give patentees greater protection from challengers. Opponents, however, believe the public has a right to challenge weak patents and recognize that the Act would largely cut into that right. They also see no need for a “faster and cheaper” method, finding PTAB to be efficient and effective as is.
Patents 2024: Artificial Intelligence (AI)
If you write an article about the future and don’t mention AI, are you really writing at all?
Last fall, President Biden issued an Executive Order regarding artificial intelligence. Part of that Order directed the USPTO to provide guidance on AI as it related to patent inventorship and patentable subject matter.
By late February, the USPTO must clarify how to evaluate inventorship when AI is used in the inventive process. The evaluation may depend on whether AI contributes to conception versus reduction to practice. Must inventors disclose their use of AI? Could it be possible that AI may or must be listed as a joint inventor? Does that affect ownership? The Federal Circuit previously held that AI cannot be named as an inventor on patents. It will be fascinating to find out which way the USPTO leans. By late July, the USPTO must clarify how they will address various types of AI-based applications. This includes not only the patentability of such applications, but also how their examination may differ from the examination of other patent applications.
The Order does not limit the USPTO from providing only the above guidance, but instead permits the agency to discuss “other considerations” as it deems necessary. Will the USPTO keep its instruction closely tied to the specific asks of the Executive Order, or will it say “challenged accepted” and introduce some broad changes? Patent procedure could look a lot different this time next year, and even that mere possibility is exciting.
Patents 2024: Increased Global Patent Harmonization
ACCELERATED PATENT GRANT
A globalized economy needs consistency of patent laws and procedures. The more willing countries are to collaborate with each other, the faster we may hope to achieve a more streamlined system for global patent protection.
An example of such collaboration came as recently as November of last year between Mexico and the United States. These two countries have exemplified the goal of cooperation by previously partnering on initiatives like the Patent Parallel Grant Agreement and the Patent Prosecution Highway program. Their latest collab is a work-sharing arrangement permitting US patentees to use an expedited process to obtain a patent in Mexico based on their US patent. This “Accelerated Patent Grant” (APG) initiative between the USPTO and the Mexican Institute of Industrial Property (IMPI) was published by IMPI on November 13 and went into effect immediately.
The ability to secure broader patent protection in a short amount of time should enable businesses to more expediently secure funding and bring their innovations to market. It will be interesting to see how the fledgling initiative is utilized in 2024, as well as whether we will see similar collaborations crop up with other countries.
UNIFIED PATENT COURT (UPC)
The UPC, opened June 2023, is an international court presiding over participating EU member states. The purpose of the UPC is to act as a single proceeding to enforce European patents in all 17 member states, thereby simplifying patent enforcement across these countries. The unified effect also streamlines patent disputes, avoiding the risk of or need for parallel litigation of the same dispute in multiple jurisdictions.
The ultimate success or failure of this attempt to harmonize of European patent laws could be a major factor in whether other countries take similar chances. In the small sample size, the UPC has in fact resulted in faster judgments, and motions for preliminary injunctions have strongly favored the patentee.
Patents 2024: The Appeals Review Panel
The USPTO overhauled the director review process last year, and in doing so retired the Precedential Opinion Panel (POP). POP was established five years prior in order to rehear certain matters pending trial or appeal, and help the USPTO Director decide whether or not to designate PTAB decisions as precedential.
The new process, which is not yet finalized, comprises both Interim Director Review and an Appeals Review Panel (ARP). The Director has the authority to review final PTAB decisions and create binding policy for PTAB decisions, which she may at her own discretion or upon request (which requires approval from an Advisory Committee). Since the inception of the new process in July 2023, there has been an increase in the number of cases sent to Director Review.
The review process also permits the Director to convene the ARP sue sponte to review these decisions. The ARP consists of the Director along with the Commissioner of Patents and the Chief Judge of PTAB. The ARP has not been utilized once to date. Looking further into 2024, however, it appears we are likely to see that change. The USPTO recently requested the Federal Circuit to remand their decision in In re: Xencor, Inc. to the Appeals Review Panel. Perhaps this will open the floodgates to ARP, or at least increase the faucet to a trickle.
About Logan Ray
Logan is a registered patent attorney at Rockridge®, a Certified B Corp and RealLeaders Top 150 global impact company. Logan previously worked at the University of Cincinnati Tech Transfer Office and the IP team at Angiodynamics, a New York-based company specializing in medical devices used to treat cancers and vascular diseases. Prior to law school, Logan spent nearly a decade as a registered dental hygienist.
Logan’s practice areas include:
- patent and trademark prosecution, licensing and litigation;
- corporate law, with an emphasis on benefit corporations, socially responsible businesses and high-growth emergent companies;
- government contracts, with an emphasis on innovation funding;
- corporate and investor financing; and,
- technology commercialization.
Email Logan Ray directly at firstname.lastname@example.org.