February 20, 2012 Articles

How the America Invents Act Revived the Prior-User Defense

The new prior-user defense provides innovators with a clear and functional defense that will hopefully spur more innovation rather than less.

By Jeff Mikrut

In general, a "prior-user defense" is a defense to a claim of patent infringement that permits a person to continue their use of an invention even if that invention is subsequently patented by another. One specific area where this defense may be particularly applicable is where the dominions of trade secrets and patents intersect. For example, suppose that a manufacturer discovers a specialized process for making a product. The manufacturer can choose to keep the process as a trade secret or divulge its discovery in an attempt to obtain a patent on the process. If the manufacturer chooses to keep the process as a trade secret, then the manufacturer could potentially be liable for patent infringement if that process is subsequently patented by another entity. In many foreign jurisdictions, a prior-user right or defense exempts the manufacturer from liability for patent infringement because the manufacturer used the patented process prior to the other entity obtaining a patent on it. Until recently, however, the United States did not provide for any meaningful prior-user defense to prevent such manufacturers from incurring this liability.

The law in the United States on prior-user defenses has fluctuated between providing a broad, strong defense to omitting it entirely. The policy debates have generally been framed according to the issues demonstrated by the above example—whether to protect the interests of those entities who invented something first and were secretly commercially exploiting the invention versus promoting disclosure through the patent process. The Leahy-Smith America Invents Act of 2011 (AIA), Pub. L. No. 112-29 (2011), readjusted the prior-user defense once again. In particular, section 5 of the act substantially expanded the scope and applicability of the prior-user defense beyond the previous version codified at 35 U.S.C. § 273 (2010). The current modifications to section 273 provide for a more robust prior-user defense that will likely have far-reaching effects that impact both patentees and accused infringers.

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