United States Patent and Trademark Office Proposes Changes to Terminal Disclaimer Practice

Thank you to John Covert and Bree Vculek for contributing to this article.

On May 10, 2024, the United States Patent and Trademark Office (“USPTO”) published a notice of proposed rulemaking in the Federal Register that could dramatically impact prosecution practices, especially for those practitioners in life sciences areas. See Fed. Reg. 89, No. 92, 40439-49 (May 10, 2024). The USPTO proposes requiring patent applicants to include language in a terminal disclaimer (“TD”) filed in response to an obviousness type double patenting rejection (“ODP”) stating that the terminally disclaimed patent will be enforceable only if the patent is not tied and has never been tied directly or indirectly to a patent in which any claim has been finally held unpatentable or invalid as anticipated or obvious. Id. This proposed rule, if implemented, will have a major impact on prosecution, licensing, and litigation strategies.

The USPTO indicated the proposed rule “is intended to promote competition by lowering the cost of challenging groups of patents tied by terminal disclaimers, resulting in reduced barriers to market entry and lower costs for consumers.” Id. at 40440. The USPTO indicated that “[n]arrowing validity disputes in litigation to only one [patent tied to other patents by one or more TDs to that patent] could result in more focused claim construction hearings, lower litigation costs, and faster resolution.” Id. The USPTO said, similarly, only one patent would need to be challenged via post-grant challenge. Id.

The USPTO further provided prosecution suggestions to avoid filing a TD:

• Combine the conflicting claims of the two patent applications into a single application;
• Cancel or amend the conflicting claims in one of the applications cited in the ODP rejection;
• Argue that the rejected claims are patentably distinct from the reference patent or application; and
• File a reissue application to add canceled conflicting claims to the patent cited in the ODP rejection.

Id. at 40444.

A link to the Federal Register in which the proposed rule is published: https://www.federalregister.gov/documents/2024/05/10/2024-10166/terminal-disclaimer-practice-to-obviate-nonstatutory-double-patenting.

The USPTO has requested comments on the proposed rule be provided through the Federal eRulemaking Portal by July 9, 2024, at the same link as the proposed rule.

We will continue to monitor this process and will follow up with in-depth analyses of the various issues raised by the complicated proposed rules and how they may be addressed.