Double (patenting) trouble: tackling obviousness-type double patenting and patent term adjustment post Cellect

By Brent Johnson, Ph.D. and Victoria Tomoko Carrington

Recently, a spotlight was thrown on the interplay between obviousness-type double patenting (ODP) and patent term adjustment (PTA) in the Federal Circuit case In re Cellect, LLC, 81 F.4th 1216 (Fed. Cir. 2023). ODP is a judicially created doctrine that prevents patentees from obtaining additional patents with claims that are not patentably distinct (i.e., obvious) from claims in a prior patent. PTA is the statutory right to have additional time added to a patent term as compensation for administrative delays by the U.S. Patent and Trademark Office (USPTO) during the prosecution of original utility and plant patent applications. Insights gained from Cellect may change how we counsel clients regarding ODP and PTA. Here is a summary of what Cellect teaches us about ODP and PTA moving forward and a discussion of best practices.

Cellect owned four patents on devices with image sensors that all claimed priority from a single application. Each of these patents would have expired on the same day, except for the fact that each was granted PTA. Cellect then sued Samsung for infringement of the four patents and in response, Samsung requested ex parte reexaminations, asserting the patents were invalid because of ODP. In each reexamination, the examiner issued a Final Office Action determining the challenged patent claims were obvious in view of Cellect’s prior-expiring reference patent claims. Cellect appealed to the Patent Trial and Appeals Board (PTAB), which sustained the examiner’s determinations that the asserted claims of the challenged patents were unpatentable under ODP.

A terminal disclaimer has the effect of limiting the patent term of a later-expiring patent to the patent term of an earlier-expiring patent. Filing a terminal disclaimer is generally how ODP rejections are overcome, but in this case, Cellect never filed a terminal disclaimer during prosecution or during the ex parte reexaminations for any of the four challenged patents. Thus, the PTAB considered whether an ODP analysis on a patent that has been granted PTA should be based on the expiration date of the patent with or without PTA and decided that it should be based on the expiration date with PTA.

Cellect raised three challenges on appeal to the Federal Circuit: (1) the PTAB erred in determining that whether a patent is unpatentable for ODP is determined based on the date of expiration of a patent that includes any duly granted PTA; (2) the PTAB failed to consider the equitable concerns underlying the finding of ODP in the ex parte reexaminations; and (3) the PTAB erred in finding a substantial new question of patentability in the ex parte reexaminations.

The Federal Circuit addressed these challenges largely by comparing 35 U.S.C. § 154, the section that sets forth PTA, to 35 U.S.C. § 156, the section that sets forth patent term extensions (PTE). PTE is a statutorily-based mechanism that extends patent terms to compensate for delays in obtaining regulatory approval from the U.S. Food and Drug Administration (FDA). PTA and PTE have many similarities as both are statutorily authorized extensions of patent term granted for administrative delays, however, the Federal Circuit went on to reject that PTA and PTE should be factored into an ODP analysis in the same manner despite their similarities.

One reason the Federal Circuit gave for treating PTA differently than PTE with respect to ODP was that § 156 on PTE does not expressly reference terminal disclaimers. The Federal Circuit’s decision relied on its finding that § 154 indicates congressional intent to speak to terminal disclaimers and ODP in the context of PTA. Therefore, the Federal Circuit held that ODP can cut short a grant of PTA. Essentially, a patent may be unpatentable for ODP, even if the only reason it has a different expiration date from another patent is because of PTA.

In addition to not being persuaded by any of Cellect’s arguments about how PTA should be treated like PTE for ODP analysis purposes, the Federal Circuit also did not find Cellect’s arguments that the underlying equitable concerns of ODP (improper timewise extensions of patent term and potential harassment by multiple assignees) were not present in this case. The Federal Circuit made it clear that just showing one did not engage in gamesmanship to obtain a grant of PTA is not enough to justify keeping that PTA in ODP situations. Likewise, the Federal Circuit did not find Cellect’s reasoning on why ex parte reexaminations should have been improper in this case persuasive. The takeaway from this point is that to effectively make the argument that ODP does not raising a substantial new question of patentability in an ex parte reexamination, there needs to be more than pointing out an examiner-issued ODP rejections of claims in other patent applications but not those being challenged.

Why does this ruling in Cellect matter? There are hundreds of thousands, if not millions, of currently active patents that have PTA. For example, out of 24,807 patents issued in July 2021, 12,889 of them (51.96%) were granted PTA. Perhaps even more interesting is the fact that the average amount of time added to those patents was 127 days. And July 2021 does not appear to have been out of the ordinary – 52.41% of patents issued in August 2020 were granted PTA with an average of 137 days added, and similarly, more than half of all patents issued in December 2019 were entitled to PTA with an average of about 142 days added. Imagine how valuable patent protection for an extra third of a year would be to your clients. And then imagine how much your clients would lose if they had to give up a third of a year.

Even though filing a terminal disclaimer is common practice for overcoming an ODP rejection, Cellect does give a reason to pause. Should one file a terminal disclaimer to overcome ODP and sacrifice PTA or run the risk of having patents invalidated for ODP – it appears to be a lose-lose situation. However, if one can address ODP without having to file a terminal disclaimer, perhaps the situation does not have to be a losing one after all. Here are some suggestions on how to avoid ODP rejections in the first place and how to deal with ODP rejections once you are already facing them without filing a terminal disclaimer and having to forfeit PTA:

·         When drafting patent applications, emphasize the different inventive aspects of each application to aid in effectively distinguishing them later.

·         Instead of filing a terminal disclaimer, argue that the rejected claims are not obvious over the claims in the reference patent or patent application. The argument is the same as a section 103 rejection over prior art, except that the rejected claims must be obvious over the claims and not the entire disclosure of the reference patent or application. 

·         For a provisional rejection over a co-pending application, amend or cancel the claims that are used as a basis for the double patenting rejection.

· Double-check ownership. If the application and the reference application/patent is not commonly owned, assigned, or subject to a joint research agreement, then an ODP rejection is improper.

·         Use 35 U.S.C. § 121’s “safe harbor” if entitled to do so. The MPEP explains this as an “[ODP] rejection may also be avoided if consonance between the originally restricted inventions is maintained in a divisional application.”

·         Drop dependent claims that contain potentially patentable distinctions and file them in continuations.

·         If a large grant of PTA is likely, recognize that under 37 C.F.R. § 1.182, a terminal disclaimer may be withdrawn before the patent is issued.

·         Remember the power of Examiner’s interviews.

In conclusion, Cellect gives us plenty of things to consider before automatically filing a terminal disclaimer in response to the next ODP rejection we encounter, especially with context about how many patents have been granted PTA and how filing a terminal disclaimer could mean giving up an extra 120+ days of patent protect. Now post Cellect, we know that PTA and PTE are to be treated differently for purposes of an ODP analysis and that ODP can (and will) cut short a grant of PTA. Further, we know that equitable concerns are unlikely to be persuasive in overcoming ODP rejections and that ODP is likely to be considered a substantial new question of patentability for ex parte reexaminations unless the prosecution history affirmatively indicates that whether an ODP rejection should be made was considered by the original examiner. Therefore, moving forward, it is useful to know how to avoid ODP rejections altogether and what options exist besides filing a terminal disclaimer to overcome ODP rejections so that a proper risk-benefit analysis of filing that terminal disclaimer can be made.

Brent Johnson, Ph.D. is a shareholder in Maschoff Brennan’s Orange County, California office.  He is focused on patent prosecution, BPAI Post-grant proceedings, IP due diligence, and client counseling – particularly in the areas of pharmaceutical and other chemistry-related technologies.

 Victoria Tomoko Carrington Victoria is a law clerk at Maschoff Brennan and has an undergraduate degree in biochemistry from Brigham Young University (2019) and a juris doctorate with high honors from the University of Utah (2023). While attending law school, she was a Quinney Research Fellow and a Law and Biomedical Sciences Scholar (LABS) who researched and published on the patent landscape around assisted reproductive technologies (ARTs), including in vitro gametogenesis.

 About Maschoff Brennan

Maschoff Brennan provides legal counsel and representation to some of the world’s most innovative companies. With over 35 attorneys and offices in the technology-focused regions of Utah and California, our attorneys are known for having the breadth of experience and the forward-thinking insight needed to handle complex technological and business issues across all industries and geographic boundaries. In addition, we have extensive experience representing clients before the ITC, PTAB, TTAB, and other administrative agencies in Washington D.C