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January 29, 2010Client Alert

Patent Term Adjustment and Wyeth v. Kappos – Court Determines USPTO Miscalculated Patent Term

The United States Court of Appeals for the Federal Circuit (“Federal Circuit”) recently issued its decision in the case captioned Wyeth v. Kappos, affirming a District Court decision which held that the USPTO has been miscalculating patent term adjustments granted due to USPTO delays in patent prosecution.

Patent Term Adjustment Before Wyeth v. Kappos

Generally, the patent term adjustment calculated by the USPTO takes into account three types of statutory delays that may be incurred during prosecution of a patent application (see 35 U.S.C. 154(b)(1)). The first type of statutory delay (Type A delay) affecting patent term adjustment relates to the promptness of responses by the USPTO during prosecution of a patent application. The second type of delay (Type B delay) relates to the statutory guarantee that a patent application will not have more than a three-year application pendency. The third type of statutory delay includes delays due to interference, secrecy order or successful appellate review. Also, any delay caused by the patent applicant during prosecution reduces day-for-day any delay incurred by the USPTO.

In addition, the statute provides that any days in which there is an overlap between Type A and Type B delays counts only as one day of patent term adjustment. Until the Wyeth decision, the USPTO had determined patent term adjustments based on the interpretation that any overlap is properly avoided when the patent term for an application is adjusted only by the larger of the Type A delay or the Type B delay.

The argument in Wyeth centered on the USPTO’s calculation of when periods of delay overlap as those delays relate to patent term adjustment. The plaintiff in Wyeth argued that the two types of delays only overlap when Type A delays occur after the first three years of prosecution have passed.

The Wyeth Decision and Its Impact

The Federal Circuit agreed with the plaintiff, determining that the length of patent term adjustments granted due to USPTO delays in patent prosecution should give patent applicants one day of patent term adjustment for each day of Type A delays, plus one extra day of patent term adjustment for each day of Type B delays (rather than the larger of the two delays, as argued by the USPTO). The Federal Circuit further held that if both types of delay occur on one day (because a Type A delay occurs after three years from the filing date), then the patent applicant only receives one day of patent term adjustment, not one day for each type of delay. In other words, after the first three years of prosecution, each calendar day that there is a delay on the part of the USPTO counts as one day for patent term adjustment calculations.

Patents and patent applications that are most likely to have patent-term adjustment affected by the Wyeth decision are patents and applications whose prosecution histories include both (1) a delay of prosecution incurred by the USPTO during the first three years of pendency, and (2) pendency of the application for more than three years from filing until either the patent issues or the applicant files a request for continued examination.

Going forward, the USPTO has implemented an interim procedure for requesting recalculation of patent term, without the normal fee, for any patent issued prior to March 2, 2010, as long as the request for reconsideration is submitted within 180 days from issuance of the patent. The requested recalculation procedure is only available for the purpose of correcting patent term adjustments for issued patents. For applications that have been allowed and for which the issue fee has yet to be paid, the normal procedure for requesting recalculation of patent term adjustment still applies. The same is true for patents that issue after March 2, 2010.

As a sign of Michael Best & Friedrich’s commitment to our clients, we will request recalculation of patent term adjustment for any patents that have issued to our clients in the last 180 days, or that will issue prior to March 2, 2010, at no charge.

For more information, please contact one of the authors of this alert or your Michael Best attorney.

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