IP Update, Vol. 10, No. 5 (23 November 2012)

Editors: Marc S. Weiner, Esq. and Nicholas P. Godici

Recent District Court Decisions Mean Patents Granted on RCE Applications May be Due Significant Additional Patent Term Adjustment

Two recent District Court decisions have determined that the USPTO is incorrectly calculating patent term adjustment (PTA) days for patents granted on applications in which a Request for Continued Examination (RCE) was filed during prosecution. Taken together, these decisions mean it is important for patent owners to urgently review recently granted patents for possible entitlement to additional PTA days and to determine what action(s) might need to be taken to obtain any additional PTA.

In the first decision, Exelixis, Inc. v. Kappos, No. 1:12cv96 (E.D. Va. Nov.1, 2012), the district court determined that the USPTO had been improperly interpreting and applying the PTA statute (35 USC § 154) as it applies to the tolling [i.e. "cutting off" or not allowing] of PTA when an RCE is filed during prosecution, specifically when the RCE is filed more than three years after the filing date of the original application. Consistent with its practice, the USPTO had determined that an RCE filed during prosecution leading to the Exelixis patent "cut-off" or "tolled" any additional PTA. Exelixis filed suit against the USPTO to challenge the USPTO's PTA calculation.

The district court found in favor of Exelixis holding that "[p]ut simply, RCE's have no impact on PTA if filed after the three year deadline has passed...; instead RCE's operate only to toll the three year guarantee deadline, if, and only if, they are filed within three years of the application filing date." (emphasis added)

The practical and immediate impact of the decision is that patent owners should review recently granted patents in which an RCE was filed more than three years after the original filing date to consider whether to take any action to obtain a recalculation of the PTA in view of the Exelixis decision. The two timing deadlines of importance are the two-month deadline from grant of the patent to file a Request for Reconsideration in the USPTO and the 180 day deadline from grant of the patent to file a civil action against the USPTO to seek recalculation of the PTA.

The second recent district court decision both "confirms" the Exelixis decision and emphasizes the importance of seeking any recalculation of PTA within the deadlines.

In Novartis AG v. Kappos, No. 10-cv-1138 (D.D.C. Nov. 15, 2012), the district reviewed a challenge by Novartis to the USPTO calculation of PTA for a group of 23 different patents, with Novartis seeking additional PTA based on the earlier Wyeth decision and additional PTA based on the recent Exelixis decision. For some of the patents (19 of the 23 at issue), the two-month and 180 day deadlines noted above had already expired but Novartis sought "equitable tolling" of the deadlines. The court determined that no equitable tolling of the deadlines was appropriate.

For one patent that had issued about two months after issuance of the Wyeth decision, the court determined that Novartis was entitled to additional PTA based on the Wyeth decision.

Important for the new issue raised by the Exelixis decision, the court agreed with the reasoning of the judge in Exelixis and found that three of the Novartis patents were similarly entitled to additional PTA based on the USPTO's incorrect interpretation and application of the law with respect to the impact on PTA by the filing of RCE's.

The Novartis decision, therefore, emphasizes the importance of reviewing recently granted patents for possible additional PTA, and the importance of taking timely action within the two-month and 180 day deadlines if patent owners wish to preserve rights to possible additional PTA.

Should you have any questions about these rulings and what they will mean for your IP, please do not hesitate to contact us.

Summary provided by Leonard R. Svensson.