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What You Can Expect from Patent Term Adjustment
October 15, 2020 Patent Ownership

What You Can Expect from Patent Term Adjustment

If you own a patent, you put considerable resources into your invention and the patent application process. Accordingly, it’s important to maximize the lifespan of that investment. You can do that with a patent term adjustment.

In theory, a patent term adjustment is straightforward. The length of patent protection lasts 20 years from the date of filing.

Without patent term adjustments, delays can shorten the enforceability period of a patent. Patent term adjustment addresses unfair delays in the granting of patents.

At first glance, this might not seem like a big issue. However, for some companies, it is, and remarkably so.

For a major pharmaceutical company, for instance, a patent is worth $50 million per day. Accordingly, there’s considerable litigation regarding patent term adjustment decisions.

To learn what you can expect from a patent term adjustment, we have organized this comprehensive guide.

Why Apply for a Patent Term Adjustment?

Before the international GATT agreement in 1995, the patent term adjustment was nonexistent. Before this agreement, patent recipients only enjoyed coverage for 17 years from the date they received patent approval.

At that time, patent delays were of little concern. Some companies even delayed the process intentionally, because by doing so, they could increase the amount of time they received protection for their intellectual property.

However, in 1995, many of the world’s leaders entered into the GATT agreement to promote international trade. America’s participation in this agreement forced its patent practices to fall in line with those of the international landscape.

Now, the rules have changed. Patent coverage takes effect from the date that a person or entity files for protection, and the protection lasts for 20 years.

As a result, delays during the review process could reduce the amount of time that a party receives patent protection. For some companies, this lapse in protection could result in millions of dollars in losses.

It’s the petitioning party’s responsibility to avoid patent application delays. Failing to do so can result in days, or even years, of lost patent protection with no recourse.

To remedy this situation, Congress created the patent term adjustment. It balances delays caused by either the patent office or the applicant.

Patent Term Adjustment Examples

Patent office rules outline three kinds of examination delays. These delay classes include:

  • A delays
  • B delays
  • C delays

The combination of these three kinds of delays equals the total US Patent and Trademark Office (USPTO) delay.

An A delay follows the 14-4 rule, which provides adjustment of the patent term for USPTO delays. This covers USPTO delays pertaining to:

  • Sending the 1st Office Action (must be sent within 14 months of filing)
  • The USPTO’s response to an applicant’s Office Action response (must be sent within 4 months)
  • The USPTO’s response to an applicant’s appeal reply brief (must be sent within 4 months)
  • The USPTO’s response to an applicant paying their issue fees (must be sent within 4 months)

To prevent A delays, the patent office must provide mail notifications to applicants in a timely fashion. For instance, if the patent office issues a Notice of Allowance, Non-Final Office Action, or Restriction Requirement, they must notify applicants by mail. Additionally, the USPTO must contact United States entities regarding their new filings within 14 months of the filing date.

A B delay includes the time that an application is pending. The 3-Year Rule guarantees that no application will remain pending for more than three years.

Meanwhile, a C delay includes any delays caused by additional actions taken by the applicant. These delays can include process interferences, derivative proceedings, secrecy orders, and appeals. A C delay stops the B delay clock. However, if the applicant’s appeal is successful, the USPTO might count that time toward the total delay.

Patent Application Timeline and Other Delays

As you can see, the USPTO timeline can prove somewhat complex. For this reason, it makes sense to get patent term adjustment help when needed. However, it does get better.

When applying for a patent, you must also consider overlapping days. A patent term adjustment period cannot exceed the number of delayed days of the issuance.

In other words, the rules forbid double-counting days. Accordingly, you must subtract overlapping days that occur in more than one of the A, B, or C delays.

When calculating patent term adjustments, the USPTO also considers applicant delays. Applicant delays can occur for several reasons. These delays can include:

  • Failing to respond to a notice from the USPTO on time (this time frame varies depending on the document)
  • Applicant’s request to suspend action
  • Deferring the issuance of a patent
  • Abandoning the patent application
  • Late payment of the issue fee
  • Failure to withdraw abandonment or revive the patent application within 2 months of abandonment
  • Conversion of a provisional application to a utility patent application
  • Submitting a preliminary paper (ex. amendment) less than one month before an office action or notice of allowance, which requires a new office action or notice of allowance to be sent
  • Submitting a reply having an omission (missing required information)
  • Submitting multiple replies before hearing back from the USPTO
  • Submitting a paper (ex. amendment) after a decision by the Patent Trial and Appeal Board
  • Submitting an amendment after a notice of allowance has been sent
  • Failing to file an appeal brief within 3 months of filing a notice of appeal
  • Submitting a request for continued examination after a notice of allowance has been sent
  • Failing to submit any required documents missing from the original patent application within 8 months from the date of filing
  • Further prosecution from a continuing application
  • Filing supplemental replies (ex. Information Disclosure Statement)

An Unconventional Use for Patents

Most often, an entity pursues a patent to protect its rights to monetize an invention. However, some companies use patents to stop other companies from competing with them.

Usually, a company that files this kind of patent never intends to use it. Nevertheless, it’s worth the investment to block competitors.

Inventors and small businesses can use the same tactic. If you create a potentially profitable invention, it might prove worthwhile to file multiple patent applications. For example, you could file additional applications that disclose variations of your design.

This tactic will prevent a competitor from entering the market with a similar product. Accordingly, it will enable you to capitalize on your invention without interruption.

Level the Playing Field with Knowledge

Those are the basic things you need to know about patent term adjustment. However, patent rules change all the time. Patent Hacks is your source for the latest information about the patent industry.

Patent Hacks consists of dedicated, knowledgeable patent professionals and inventors with 40+ years of experience in the patent industry. We know how it feels to go up against corporate giants. We’ve created Patent Hacks to provide an advantage for the everyday inventor. Knowledge is the key to leveling the playing field, and at Patent Hacks, we try to put the power back in the inventor’s hands.

We’ve created a patent education platform that makes it easy for anyone to learn to search, draft, and file their own patent applications. Please feel free to visit our blog or the Patent Hacks Learning Center to expand your knowledge of the patent universe.

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