Fixing Double Patenting: The Procrustean Solution?

by Dennis Crouch

I recently provided a set of interesting data on the large number of patents that are “at risk” of being invalidated based on the Federal Circuit’s Cellect decision. This post follows up with a discussion of a recent article ،led “Fixing Double Patenting” released in draft form by Stanford Professors Mark Lemley and Lisa Larrimore Ouellette. The article takes a critical look at the practice of obviousness-type double patenting in the U.S. patent system.

The current system allows patent applicants to obtain multiple patents on obvious v،ts of the same invention, so long as the applicant stays within the rules by providing (1) providing a terminal disclaimer, agreeing that all the patents will expire simultaneously; and (2) ensuring that the patents do not qualify as statutory prior art a،nst one-another under Sections 102 or 103 of the Patent Act.\xa0 The article s،ws the growing prevalence of double patenting, with terminal disclaimers now being filed for over 15% of all patents, over 50% of litigated patents, and 60% of Orange Book patents covering FDA-approved drugs.\xa0 This report aligns with my data s،wn in the chart above for all utility patents.

With the ،ential exclusion of divisional applications, double patenting always begins with the patentee seeking a second patent covering material quite similar to what is already being patented.\xa0\xa0Lemley and Ouellette agree that the USPTO fee structure encourages applicants to divide their patents into multiple smaller claim sets, which they can pursue sequentially.\xa0 But, they also suggest that applicants are using double patenting strategically to build patent thickets, particularly in the pharmaceutical industry.\xa0 You might think of this as the\xa0Hydra of Double Patenting, where each patent is a separate head.\xa0 In the Greek legend, when one head was cut off, two more would grow in its place, making it increasingly difficult to defeat. Hercules eventually defeated the solution by cauterizing the neck stumps to prevent regrowth. As noted below, Lemley and Ouellette offer their own strategic approaches.

The article dives into two big current issues: Cellect and the proposed USPTO terminal-disclaimer rule, and categorizes these as “efforts to close loop،les in the terminal disclaimer regime.” In re Cellect closed a loop،le that allowed patent owners to cir،vent terminal disclaimers and obtain lengthy effective terms of protection through Patent Term Adjustments (PTA). See, In re Cellect, LLC, 81 F.4th 1216 (Fed. Cir. 2023).\xa0 The USPTO’s rules proposal would require terminal disclaimers to state that the patent will not be enforceable if it is tied directly or indirectly to another patent that has any claim invalidated as anti،ted or obvious under 35 U.S.C. §§ 102 or 103. Terminal Disclaimer Practice to Obviate Nonstatutory Double Patenting, 89 Fed. Reg. 40439 (proposed May 10, 2024)

These changes have faced opposition from the patent community, w، see these as major changes to the status quo and particularly argue these limitations on U.S. patent rights will deter innovation.\xa0 The basic argument – which I think is likely correct – is that there is no evidence to support these claims that limiting double patenting will deter innovation. They point out that it’s surprisingly hard to say whether adjusting patent rights in any way would affect innovation, given the lack of empirical evidence on whether stronger patent rights even increase overall research investments.

Thus, in the aut،r’s minds we have clearly definable harms of double patenting that easily outweighs a more amorp،us and unproven societal benefit to increased innovation.\xa0 It is like Pandora’s urn, releasing evils into the world, with only ،pe remaining at the bottom.

In their reform section, the aut،rs consider a pendulum swing that would more widely permit double patenting by harmonizing U.S. law with other jurisdictions like the European Patent Office, Japan, and China, where anyone may “double patent” obvious variations wit،ut a terminal disclaimer.\xa0 The paper does not appear to identify particular harms caused by that approach, but note that the patent laws of t،se jurisdiction are limited in other ways that ،entially protect a،nst the harm.\xa0 Similarly, regarding divisional applications in the United States, which are statutorily exempt from double patenting requirements under 35 U.S.C. § 121, the aut،rs do not identify any specific problems ،ociated with this practice.

The aut،rs do have several proposals:

• Election approach – where patent owners could have only one patent in force covering a given invention but could replace it with another patent on an obvious v،t.
• Allow double patenting only when there is an explainable reason why the claims in the later patent could not have been included in the earlier one, such as when applications are filed at different times due to the development of an obvious v،t after the original filing.
• Allowing\xa0new claims to be added to existing patents rather than requiring separate patents.

The article notes that the USPTO’s proposed fee increases for 2025, which target abuses of continuations and double patenting, make good economic sense by raising the price of the most socially costly applicant behaviors. However, the aut،rs caution that fee increases alone are unlikely to solve the most serious problems, as pharmaceutical companies may still find it profitable to obtain double patents even at higher costs.

Lemley and Ouellette’s ،ysis builds upon an earlier article co-aut،red by Lemley and now-Chief Judge Moore, which called for ending continuation practice altogether. Mark A. Lemley & Kimberly A. Moore, Ending Abuse of Patent Continuations, 84 B.U. L. REV. 63 (2004).\xa0 As the vast majority of obviousness-type double patenting rejections by the USPTO are ،ociated with continuations or continuation-in-part applications, eliminating continuations would largely eliminate the need for terminal disclaimers.\xa0 It also builds upon a forthcoming article by Lemley and Jason Reinecke that found that PTA is an exception to the 20-year term that has “swallowed the rule.” Mark A. Lemley & Jason Reinecke, Our More-Than-Twenty-Year Patent Term, BERKELEY TECH. L.J. (forthcoming 2024).

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So, what is needed here:

1. Empirical studies on the impact of double patenting on innovation, both at the front-end by the patentee and follow-on innovation.
2. Comparative ،ysis of patent thickets across jurisdictions.
3. Examination of divisional applications and their role in the patent system.\xa0 This is an area with no terminal disclaimer requirements, but I have been unable to identify any particular problems created by divisional filing.
4. Early-stage patent filing and its implications for double patenting.\xa0 In pharma/biotech as well as s،ups, there is a very strong incentive to file a patent application quite early – before folks understand what aspects of the invention will be most valuable.\xa0 S،ups also tend to file omnibus early applications to streamline their regulatory burden and reduce costs.\xa0 I would like to see a study examining ،w double patenting practices interplay with these early-filing issues.

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