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First-to-File vs. First-to-Invent

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					  First-to-File vs. First-to-Invent
                                                                                                             may	not	be	exactly	what	the	Framers	of	the	
                                                                                                             constitution	had	in	mind.
                                                                                                                It	 is	 instructive	 that	 copyright,	 another	
                                                       receive	a	patent	due	to	the	prohibitive	cost	         form	 of	 intellectual	 property	 protection	
                          By AlexAnder PoltorAk1
                                                       of	proving	the	date	of	conception.	However,	          stemming	 from	 the	 same	 clause	 in	 the	
                                                       such	 situations	 are	 rare	 and	 interference	       constitution,	vests	with	its	owner	as	soon	as	
                                                       proceedings	are	infrequent.	out	of	444,510	           the	creative	idea	is	fixed	in	a	tangible	form,	
                                                       patent	applications	filed	in	2006,	only	129	          not	when	the	copyright	is	registered.
                                                       –	 or	 0.029%	 –	 were	 involved	 in	 interfer-
                                                       ence	 proceedings.	 Most	 patent	 attorneys	          QualIty oF InventIon dIsclosure
                                                       involved	 in	 patent	 prosecution	 go	 through	           under	our	patent	system,	an	inventor	has	
                                                       their	 entire	 professional	 career	 without	         sufficient	time	to	perform	a	thorough	search	
                                                       ever	representing	a	client	in	an	interference	        of	prior	art	to	determine	if	the	invention	is	
IntroductIon                                           dispute.                                              patentable.	 Having	 sufficient	 time	 to	 pre-


t
     he	 united	 States	 patent	 system	 is	               the	theoretical	basis	of	the	First-to-File	       pare	a	patent	application	has	positive	effect	
     based	 on	 a	 unique	 “First-to-Invent”	          system	 stems	 from	 the	 contract	 theory	 of	       on	the	quality	of	filed	applications	and	the	
     doctrine,	which	means	that	the	inven-             patents.	 under	 this	 theory,	 a	 patent	 is	 a	     breadth	 of	 disclosure.	 	 recent	 research	
tor	who	first	conceived	of	the	invention2	is	          contract	 between	 an	 inventor	 and	 society,	       demonstrated	 that	 patentees	 in	 “First-to-
considered	the	first	inventor	and	is	entitled	         which	grants	the	inventor	a	public	franchise	         file”	countries	lag	far	behind	uS	patentees	
to	patent	protection.		other	countries	have	           (i.e.,	exclusive	right	of	use)3	in	exchange	for	      in	 patent	 disclosure	 breadth.	 the	 study	
patent	systems	based	on	the	“First-to-File”	           public	disclosure	of	the	invention.		If	a	pat-        shows	 that	 uS	 patents	 have	 significantly	
doctrine,	in	which	the	patent	is	granted	to	           ent	is	a	quid	pro	quo	for	public	disclosure	          higher	 page	 count	 (indicating	 breadth	 of	
the	inventor	who	is	the	first	to	file	a	patent	        of	the	invention,	then	it	is	not	unreasonable	        disclosure)	 and	 claim	 count	 (indicating	
application,	regardless	of	the	date	of	inven-          to	 reward	 with	 the	 right	 of	 exclusive	 use	     breadth	 of	 protection)	 than	 patents	 origi-
tion.		the	Patent	reform	act	of	2007,	which	           the	 first	 inventor	 to	 disclose	 the	 invention	   nating	from	the	countries	with	First-to-File	
was	passed	by	the	House	of	representatives	            to	the	public.                                        regime.7		a	First-to-File	system	necessarily	
last	September	and	is	awaiting	a	vote	in	the	              a	 practical	 advantage	 of	 the	 First-to-       leads	 to	 a	 race	 to	 the	 patent	 office,	 which	
Senate,	if	passed	into	law,	will	change	our	           File	 system	 is	 its	 utter	 simplicity.	 there	     leads	to	half-baked	patent	applications.
system	 inter alia	 to	 First-to-File.	 	 this	        are	no	interference	disputes—whoever	gets	
article	 analyzes	 the	 pros	 and	 cons	 of	 the	      the	 earliest	 postmark	 stamp	 on	 the	 patent	      eFFect on small and
two	systems	and	what	it	means	to	american	             application	gets	the	patent.4                         IndePendent Inventors
innovators	and	industry.                                   another	 advantage	 of	 the	 First-to-                another	unique	feature	of	the	american	
                                                       File	 system	 is	 that	 it	 eliminates	 so-called	    patent	system	is	the	“Grace	Period”.		the	
FIrst-to-FIle vs. FIrst-to-Invent                      “secret	 prior	 art”,	 which	 are	 inventions	        twelve-month	Grace	Period	afforded	by	uS	
Patent regImes                                         for	 which	 patent	 applications	 have	 not	 yet	     patent	law	allows	an	inventor	to	file	a	patent	
   the	principal	advantage	of	the	uS	First-            been	 filed	 and	 therefore	 cannot	 be	 found	       application	within	one	year	after	(a)	public	
to-Invent	system	is	that	it	rewards	the	first	         through	a	prior	art	search.		If	they	are	filed,	      disclosure	of	the	invention	or	(b)	first	sale	
inventor,	 not	 the	 winner	 of	 the	 race	 to	 the	   such	 patent	 applications	 could	 preclude	          of	 the	 patented	 product.	 	 under	 the	 First-
Patent	office.		                                       other	inventors	from	getting	a	patent.5		this	        to-Invent	 regime,	 there	 is	 no	 necessity	 for	
   When	two	inventors	file	patent	applica-             seldom	 happens,	 and	 the	 advantage	 is	 of	        the	inventor	to	rush	a	patent	application	to	
tions	 on	 the	 same	 invention,	 there	 may	 be	      marginal	value.                                       the	 Patent	 office.	 	 the	 inventor	 can	 take	
an	interference	hearing	before	the	Board	of	                                                                 his	time	to	figure	out	a	marketing	plan	and	
appeals	and	Interferences	at	the	uS	Patent	            constItutIon                                          business	model,	and	decide	whether	or	not	
office	 to	 determine	 who	 conceived	 of	 the	            Some	opponents	of	the	First-to-File	sys-          it	is	prudent	to	invest	in	preparing	and	pros-
invention	 first,	 and	 whether	 the	 inventors	       tem	raise	a	constitutional	argument.	Indeed,	         ecuting	 a	 patent	 application.	 	 although	 a	
have	been	diligent	in	reducing	their	inven-            the	First-to-Invent	system	is	deeply	rooted	          proposed	change	to	the	First-to-File	regime	
tions	to	practice.		this	is	an	expensive	and	          in	 the	 uS	 constitution	 (article	 I,	 Section	     does	 not	 eliminate	 the	 Grace	 Period,	 as	
involved	albeit	infrequent	procedure.	                 8).	 	 	 the	 constitution	 grants	 congress	 the	    a	 practical	 matter,	 such	 regime	 would	 set	
   the	 only	 disadvantage	 of	 the	 First-to-         power	 to	 secure	 exclusive	 rights,	 i.e.	 to	      off	 a	 race	 to	 the	 Patent	 office,	 any	 grace	
Invent	 system	 is	 this	 costly	 and	 lengthy	        grant	 patents	 to	 inventors,	 not	 winners	 of	     period	 notwithstanding.	 	 a	 First-to-Invent	
interference	 proceeding.	 Indeed,	 the	               the	race	to	the	Patent	office.		the	inventor	         system,	therefore,	is	very	important	to	small	
expense	of	fighting	patent	interference	may	           is,	by	definition,	the	one	who	invented	first.	  	    businesses	and	independent	inventors	who	
prove	prohibitive	for	a	small	inventor	lead-           an	 inventor	 can	 hardly	 be	 defined	 as	 the	      need	 to	 take	 their	 financial	 resources	 into	
ing	 to	 abandonment	 of	 the	 patent	 applica-        one	who	is	first	to	file	a	patent	application.6	      consideration.8		
tion.	It	is	not	inconceivable	that	an	inventor	        replacing	 the	 first	 inventor	 with	 the	 first	        under	 the	 First-to-File	 regime,	 large	
who	was	first	to	come	up	with	an	invention	            filer,	as	proposed	in	the	reform	act	of	2007	         corporations	 with	 well-established	 inven-
and	first	to	file	a	patent	application	may	not	                                                              tion	disclosure	procedures,	patent	commit-

40	                                                    Intellectual	ProPerty	today				aPrIl,	2008
tees	 and	 armies	 of	 in-house	 attorneys	 will	
always	 beat	 a	 lone	 inventor	 in	 the	 race	 to	
the	 Patent	 office,	 thus	 placing	 small	 and	
independent	 inventors	 at	 a	 severe	 disad-
vantage.

HarmonIzatIon oF Patent law
     the	 proponents	 of	 the	 change	 from	
First-to-Invent	 to	 First-to-File	 argue	 that	
it	 is	 important	 for	 the	 uS	 to	 harmonize	 its	
patent	laws	with	the	rest	of	the	world.		they	
fail	to	explain	why.		Harmonization	may	be	
a	noble	goal	but	needs	be	approached	with	
caution.	 	 the	 question	 is	 which	 standard	
will	 prevail	 –	 ours,	 which	 is	 strong,	 or	
theirs,	which	is	weak.		
     the	uS	patent	system	is	one	of	the	first	
and	 most	 developed	 patent	 systems	 in	 the	
world.	 	 the	 uS	 continues	 to	 lead	 the	 way	
as	the	first	country	to	recognize	the	patent-
ability	 of	 software	 and	 business	 methods.	    	
Inventors	 from	 around	 the	 world	 rely	 on	
u.S.	 patents.	 	 roughly	 half	 of	 all	 patents	
issued	are	to	foreign-based	inventors.	this	
begs	the	question,	is	it	wise	to	change	our	
time-tested	 patent	 system	 to	 conform	 to	
weaker	 patent	 systems	 of	 other	 countries	
in	the	name	of	harmonization?		What	about	
other	 countries	 harmonizing	 their	 patent	
laws	 with	 ours	 by,	 for	 example,	 adopting	        proposal	in	its	entirety.		In	a	fair	and	bal-        endnotes
our	 twelve-month	 grace	 period	 that	 leads	         anced	 patent	 reform,	 goals	 of	 patent	 law	      1.	 alexander	Poltorak	is	the	ceo	of	General	Patent	
to	 fuller	 invention	 disclosures	 and	 more	         harmonization	would	be	balanced	with	the	                corporation.	 He	 can	 be	 reached	 at	 apoltorak@
mature	patent	applications?                            interests	and	concerns	of	universities,	small	           gpci.com.
     the	 united	 States	 is	 undoubtedly	 the	        businesses	and	independent	inventors.		In	           2.	 upon	 conception	 of	 the	 invention,	 the	 inventor	
                                                                                                                must	 diligently	 reduce	 it	 to	 practice	 by	 fil-
most	 inventive	 country	 in	 the	 world.	 	 It	 is	   such	 a	 scenario	 one	 may	 be	 inclined	 to	           ing	 a	 patent	 application	 (constructive	 reduction	
the	 world	 leader	 in	 many	 fields,	 including	      consider	 relative	 pros	 and	 cons	 of	 both	           to	 practice)	 or	 building	 a	 working	 prototype	
science,	hi-tech	and	biotechnology.		In	the	           systems.	 	 the	 proposed	 Patent	 reform	               (actual	reduction	to	practice)	without	abandoning,	
                                                                                                                suppressing	or	concealing	the	invention.
uS,	we	create	original	and	innovative	prod-            act	 of	 2007,	 however,	 is	 so	 consistently	
                                                                                                            3.	 the	 patent	 franchise	 is	 actually	 broader	 than	
ucts,	which	are	copied	and	sold	back	to	us	            and	 unmistakably	 biased	 in	 favor	 of	 large	         exclusive	 right	 to	 use.	 It	 is	 a	 right	 to	 exclude	
as	 counterfeit	 goods	 by	 foreign	 infringers.	  	   corporations	 and	 against	 the	 interests	 of	          others	 from	 making,	 using,	 selling,	 offering	 for	
Should	 we	 really	 rush	 to	 lower	 our	 patent	                                                               sale	and	importing	the	patented	invention.
                                                       small	 entity	 inventors	 that	 the	 purported	
standards	down	to	the	levels	of	those	coun-                                                                 4.	 under	the	proposed	new	legislation,	there	will	be	
                                                       motivation	 for	 the	 proposed	 change	 to	 the	         a	procedure	to	determine	the	first	inventor	to	file.
tries	 that	 routinely	 infringe	 our	 patents?	   	   First-to-File	 system	 can	 only	 be	 viewed	        5.	 that	is,	if	the	date	of	conception	by	the	first	inven-
Shouldn’t	 the	 congress	 be	 asking	 who	 is	         with	deep	suspicion.	                                    tor	 is	 earlier	 than	 the	 date	 of	 conception	 by	 the	
going	 to	 benefit	 from	 such	 weakening	 of	            our	 founding	 fathers	 had	 the	 foresight	          second	inventor.
u.S.	patent	laws?		the	answer	is	clear	–	it	           to	afford	first	inventors,	not	first	filers,	the	    6.	 thus,	 the	 artful	 crafting	 of	 the	 language	 in	 the	
                                                                                                                Patent	reform	act	of	2007	to	read	“First	Inventor	
is	not	to	the	benefit	of	american	inventors	           exclusive	 rights	 to	 their	 inventions.	 	 this	       to	File.”
or	american	manufacturers;	the	change	will	            constitutional	 right	 is	 the	 basis	 of	 our	      7.	 e.		archontopoulos	et	al,	When	small	is	beautiful:	
mainly	benefit	foreign	businesses	trying	to	           Patent	System	–	one	of	the	oldest	and	one	               Measuring	the	evolution	and	consequences	of	the	
compete	 with	 american	 businesses	 in	 the	          of	the	best	patent	systems	in	the	world,	a	              voluminosity	 of	 patent	 applications	 at	 the	 ePo,	
                                                                                                                Information Economics And Policy, 19(2),	 pp.	
american	market.                                       system	that	served	our	county	well	for	over	             103-132,	(June	2007).
                                                       two	 centuries.	 	 Before	 we	 tinker	 with	 the	    8.	 the	 language	 of	 the	 House	 version	 of	 the	 Bill	
conclusIon                                             system,	 perhaps	 we	 should	 defer	 to	 the	            (H.r.	 1908)	 creates	 a	 trigger	 that	 is	 not	 pulled	
   In	the	final	analysis,	a	First-to-Invent	vs.	                                                                until	europe	and	Japan	give	u.S.	inventors	a	one-
                                                       framers	 of	 the	 constitution	 who,	 after	 all,	       year	grace	period.		However,	the	flaw	is	the	trigger	
First-to-File	 debate	 cannot	 be	 considered	         were	the	first	to	invent	our	First-to-Invent	            does	not	include	china,	which	is	significant	given	
outside	of	the	context	of	the	patent	reform	           patent	system.		 IPT                                     their	piracy.


	                                                      Intellectual	ProPerty	today				aPrIl,	2008	                                                                    41

				
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