What you need to know:

Your patents may have a longer term than you think. Recent District Court decisions have found that patent holders are often entitled to a longer extension under “patent term adjustment” provisions than the Patent and Trademark Office actually awards. Most recently, a federal court in the Eastern District of Virginia discredited a PTO policy that limited the extension of patent terms for applicants who filed a Request for Continued Examination in applications that had been pending for more than three years.  

What you need to do:

Those who have recently issued patents, or applications that have been pending for more than three years, should consult with counsel to evaluate the term to which they may be entitled and how they can ensure that all available extensions are properly credited.

Patent Term Adjustment

In 1995, Congress enacted the Uruguay Round Agreements Act, which changed the term of a United States patent from 17 years from the date of issue to 20 years from the date of filing. The URAA also provided for recovery of patent terms lost due to delays attributable to the PTO. Three different types of such delay were defined – ‘A,’ ‘B’ and ‘C’ delay; the recent decision relates to ‘B’ delay, which occurs when applications take longer than three years to issue. In accordance with the URAA, the PTO awards a patent term adjustment once the patent has been issued to compensate for the delay.  

In 1999, Congress enacted the American Inventors Protection Act, which provided applicants with the opportunity to file Requests for Continued Examination to extend their patent’s examination period after a final rejection by the PTO. A portion of the AIPA amended the patent term adjustment accrual process described above so that it would exclude time spent on examination as the result of an RCE.  

The PTO’s practice has been to deny patent term adjustment for ‘B’ delay if an RCE is filed within three years of an application’s filing date (or the commencement of the national phase of the review), and to award no further patent term adjustment for ‘B’ delay if an RCE is filed after three years from the application date (i.e., during the period when ‘B’ delay has already begun to accrue).  

Exelixis v. Kappos

At issue in Exelixis v. Kappos was the propriety of the RCE exclusion applied by the PTO to RCEs filed more than three years after the application date. That is, the case asked whether further accrual of ‘B’ delay should be permitted after such an RCE is filed.

Exelixis filed a patent application on January 15, 2008 and received a final rejection from the PTO on March 9, 2011, approximately three years and two months later. Shortly thereafter, Exelixis filed an RCE on April 11, 2011 to further prosecute its application. The application ultimately issued on August 2, 2011. The PTO awarded the patent a total patent term adjustment period of only 85 days, calculated from the point at which ‘B’ delay began to accrue (January 16, 2011) until the RCE was filed (April 11, 2011). Exelixis contended that it was entitled to patent term adjustment of 199 days—from January 16, 2011 until the patent issued on August 2, 2011.

The court decided in favor of Exelixis, holding that the RCE exclusion applies only to RCEs filed within three years of the application date and not to RCEs filed beyond three years. Thus, according to the court’s ruling, applications with an RCE filed during the period of ‘B’ delay are entitled to further accrual of ‘B’ delay, and the PTO has been improperly denying further patent term adjustment for such applications.

Although the decision by the District Court is binding on the PTO, the PTO may decide to appeal to the Court of Appeals for the Federal Circuit. In the meantime, patent holders with RCEs filed more than three years after the application date should consider taking action to potentially extend their patent term