Judge Says “No” to New Patent Office Rules

On Tuesday, a Virginia district court rejected new U.S. Patent and Trademark Office rules intended to rein in the current patent application backlog. The ruling comes as a relief to companies involved in technically complex industries, especially biotechnology and pharmaceutical firms.

Back in August 2007, the USPTO released new rules limiting the number of claims and continuations, which are used to amend patent claims, allowed on a single patent application. The USPTO argued the rules would help streamline the application process and reduce the growing backlog. The Wall Street Journal Law Blog reports that the new rules were set to go into effect in November 2007, but a lawsuit filed against the new rules by drug maker GlaxoSmithKline and Triantafyllos Tafas, a medical technology entrepreneur, changed all that. The district judge ordered an injunction on the rules, preventing them from going into effect until they were examined.

In his decision (see pdf at Patently-O), Judge James Cacheris ruled that the USPTO does not have the authority to make such changes:

The court finds that the Final Rules are substantive in nature and exceed the scope of the USPTO’s rulemaking authority.

Critics of the new rules cheered the judge’s ruling, arguing they would “water-down” more complex patents. Biotech companies and drug makers felt the rules would pressure them into exposing their drug development strategies too early in the application process. Other companies and their patent attorneys were spared the hassle of rearranging their patent portfolios to follow the new rules.

The USPTO voiced its disappointment with the ruling, releasing a statement in defense of their new rules, believing them to be only procedural in nature. They hinted at a possible appeal.

Challenges are still ahead. The Patent Reform Act of 2007, currently in the Senate, could significantly alter patent system. But for now, some can celebrate.

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