Federal Circuit: Patent Term Adjustment Results in Invalidity on Obviousness-Type Double Patenting Grounds

The Federal Circuit recently affirmed a United States Patent and Trademark Office (PTO) decision to invalidate four related patents on obviousness-type double patenting grounds (OTDP), holding that any analysis of OTDP for patents that were granted a patent term adjustment (PTA) by the PTO should be based on an expiration date that includes the PTA.

Key Takeaways: 

• Any OTDP analysis, regardless of whether a terminal disclaimer is filed, should be based on the adjusted expiration date of the challenged patent.
• That adjusted expiration date includes PTA, but does NOT include any PTE granted as a result of the FDA regulatory approval process.
• A later-filed, earlier expiring patent that does not receive PTA can serve as an invalidating OTDP reference for earlier-filed, later expiring patents that did receive PTA.
• Unless the reference patent is already expired, a patentee may disclaim the challenged patent's PTA to avoid an invalidity finding based on OTDP.

Background

The appeal in this case arose from a series of four ex parte reexaminations in which the petitioner challenged the validity of four related patents on OTDP grounds. By way of background, the relevant inquiry for OTDP is whether the claims of a later-expiring patent would have been obvious over the claims of an earlier-expiring patent owned by the same party.

During the ex parte reexaminations, the examiner found the challenged claims of the four patents invalid because the claims were patentably indistinct from claims in earlier-expired patents. Notably, none of the four challenged patents was subject to a terminal disclaimer. All four of the patents received PTA due to delays in their prosecution by the PTO, but expired while the case was pending at the PTO. And all four patents were challenged based on claims in patents that issued from later-filed patent applications, including one patent that was not granted any PTA. That is, the only reason the challenged patents and their respective reference patents had different expiration dates was because of adjustments due to PTA. The patentee in this case did not dispute that the claims of the challenged patents and reference patents were patentably indistinct. Instead, the patentee argued that the PTA should not be considered when determining the expiration dates for patents as part of an OTDP analysis. The Board rejected this argument and affirmed the examiner's rejection.

Appeal

The patentee appealed, arguing, inter alia, the Board erred because its finding of invalidity due to OTDP included PTA. The Federal Circuit affirmed the Board's determination.

More specifically, the Federal Circuit held that an analysis of OTDP should be based on the patent term that includes any applicable PTA. Despite its previous holdings that patent term extension due to patent term extension (PTE) does not raise an OTDP issue, the court rejected the patent owner's argument that PTA and PTE should factor similarly into an OTDP analysis. The court observed that the PTA statute differs because it makes an express exception to term adjustment when the patent is subject to a terminal disclaimer, whereas the PTE statute does not. The court further noted that PTA and PTE serve different purposes-PTA being granted for delays by the PTO in prosecution and PTE being granted for time expended during the Food and Drug Administration (FDA) regulatory approval process. Thus, the court was not convinced that PTA and PTE should operate in the same fashion for purposes of an OTDP analysis.     

The Federal Circuit also rejected the argument that the OTDP finding should apply only to the period of PTA. In other words, it should only operate as a limitation on the patent term, rather than result in a finding of invalidity. The court reasoned that to invalidate the claims only as to the period of PTA would be tantamount to retroactively granting a terminal disclaimer that the patentee failed to seek during the life of the patent.

Practice Tip

This decision raises important questions about both patent continuation practice and disclaiming patent term based on commonly-owned patents with different expiration dates. In particular, patentees should consider whether responding to an OTDP challenge on the merits is a better strategy in both prosecution and litigation. And during prosecution, applicants need to weigh the value of existing patent claims that benefit from PTA against the potential value of pursuing additional claims that-if they don't also receive that amount of PTA and are found to be patentably indistinct-could eliminate or shorten the term of the existing claims.

In re Cellect, C.A. Nos. 2022-1293, -1294, -1295, -1296 (Fed. Cir. Aug. 28, 2023).