Patent maintenance fees are required to be paid on a granted patent 3.5, 7.5, and 11.5 years after a patent is granted. As an Austin Patent Attorney, it is important to docket these dates upon a patent issuing and contacting my client 3 months in advance of the maintenance fees date to determine if they desire to continue having an enforceable patent. Times do occur where a client is unreachable for a number of different reasons, but contacts me after the maintenance fee is due. The United States Patent and Trademark Office does allow for patents to be revived if the non-payment of a maintenance fee is “unintentional.” Specifically, 37 CFR 1.378 sets forth the requirements to revive an abandoned patent application if the non-payment of a maintenance fee is unintentional.
To revive an abounded application, all that is required is for the patent attorney to fill out this USPTO form and pay the associated maintenance fee. However, the patent attorney is required to state all “material” reasons why the non-payment of the maintenance fee was unintentional.
NETWORK SIGNATURES, INC. v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
(12-1492.Opinion.9-20-2013.) is a recent patent law case dealing with this issue. In this case, the Naval Research Laboratory was the assignee of U.S. Patent No. 5,511,122, which lapsed for nonpayment of the 7.5 maintenance fee. Two weeks after the lapse of the patent application, the Naval Research Laboratory received an inquiry from NETWORK SIGNATURES about licensing the ‘122 patent. Subsequently, the Naval Research Laboratory petitioned the USPTO to revive the patent, and the ‘122 was revived and then licensed. NETWORK SIGNATURES later sued State Farm for infringement of the ‘122 patent, and State Farm argued that the ‘122 patent was unenforceable on the grounds that the patent attorney for the Naval Research Laboratory engaged in inequitable contact by falsely representing the USPTO that the Naval Research Laboratory non-payment was unintentional. Naval Research Laboratory’s patent attorney had tried to call and email Naval Research to determine if they wanted to pay the maintenance fee.
However, while filing the USPTO’s template form regarding an unintentional non-payment of a maintenance fee, Naval Research Laboratory’s patent attorney did not fill out a reasons causing the unintentional non-payment.
In this case the Federal Circuit stated that acceptance of late payment of maintenance fees is authorized by statute and the USPTO provides a standard form for late payment. Therefore, at least at a base level the USPTO accepts late payment of maintenance fee. The Federal Circuit held that Naval Research Laboratory’s patent attorney had acted promptly of learning of the commercial interest in the ‘122 patent, the patent was revived after only a two week delay, and the record shows no irregularity in the patent attorney’s actions. Furthermore, the Federal Circuit held that the form does not require a statement of the reasons for the initial non-payment and for a change in position regarding the payment of the fee.
The Federal Circuit also reasoned that the compliance of the standard procedure for delayed payment, using the PTO’s forms does not provide clear and convincing evidence of withhold material information with intent to deceive the USPTO.
AUSTIN PATENT ATTORNEY TAKE-A-WAYS
- Make sure you contact (or try to contact) your clients way in advance of fee deadlines. This is for all dates that may require docketing, including: conversion of applications, filing RCEs or other responses to Office Actions, issue fees, maintenance fees, etc. I personally try to contact clients three months in advance, just in case there is an issue contacting them, or at least put the ball in their court (for liability reasons).
- It is possible to revive an abandoned patent. However, try to revive the patent as close to the date of abandonment if possible. I am sure this case would have turned out differently if the time period was months or years instead of weeks.
- When you are reviving an abandoned patent, if there are no “material” reasons why the patent is to be revived, according to the holding of this case it is best practice to not include the non-material reasons of unintentional non-payment. However, as a patent attorney to limit your liability it is probably best practice to tell your client that you are going to include the reasons of why the fee was unintentionally not paid. By disclosing all reasons associated with the non-payment of the fee it is less likely that the patent attorney will be held to be liable for inequitable conduct.