On May 10, 2024, the United States Patent and Trademark Office (USPTO) published a Notice of Proposed Rulemaking intended to change current practices around terminal liability waivers. The proposed change could have substantial effects on the enforceability of patents that are subject to a terminal disclaimer.
Legal background
At a basic level, a terminal disclaimer links two patents so that the performance period of the second patent does not extend beyond the performance period of the first patent. The USPTO often requires a terminal disclaimer if at least one of the claims of the second patent is an obvious variant of the first patent, a condition known as โnon-statutory (obviousness) double patenting.โ Under current rules, if the first patent is determined to be invalid, there is no direct effect on the second patent that is subject to the terminal disclaimer.
Proposed rule change
The Notice of Proposed Rulemaking takes the position that terminal disclaimers generally stifle competition and can lead to infringement actions involving too many patents intended for essentially the same invention.1 Therefore, the USPTO is considering revising the current rules so that a patent subject to a terminal waiver is no longer enforceable if:
- A federal court or the USPTO has made a final, non-appealable decision that any claim in the first patent is invalid under 35 USC ยง 102 or ยง 103; either
- A legal disclaimer of a claim is filed for the first patent after any challenge to that claim under 35 USC ยง 102 or ยง 103 has been made.2
The proposed rule change would make it easier for a defendant in a civil action to invalidate multiple closely related patents filed simultaneously.
The USPTO has noted that opponents of changes in terminal disclaimer practice raised the following: โvalidity is determined on a claim-by-claim basis; claims are presumed valid under 35 USC ยง 282; The fact that the prior art invalidates a claim in one of two patents linked by a terminal disclaimer does not necessarily mean that the same prior art would invalidate a claim in the other patent; and/or these changes raise issues of due process and equity.โ3 The USPTO also noted that some commenters questioned the USPTO's authority to make changes to terminal liability exemption practice,4 but the USPTO responded that โ[a] The rule requiring terminal disclaimers filed to avoid non-statutory double patenting to include language establishing conditions for enforcement was previously maintained as part of the USPTO's rulemaking authority. See in re Hay Ornum686 F.2d 937 (CCPA 1982).โ5
Thinking in the future
The proposed rulemaking is currently open for public comment until July 9, 2024. Those interested in submitting comments can do so at the following link: https://www.regulations.gov/document/PTO-P-2024-0003-0001.
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