Impact of the Leahy-Smith America Invents Act on Patent Prosecution and Patent Litigation

Whenever there are discussions related to patent law and amendments, many are concerned with each proposal's impacts, advantages, and disadvantages in choosing  the best available approach. As covered in Patexia 122, the past decade saw new levels of patent litigation and filings as well as the most significant event which influenced them one way or another.

In 2011, President Obama signed the Leahy–Smith America Invents Act into law. It was the most significant legislative change in patent law since the Patent Act of 1952. Aiming for job creation and competitiveness, this act shifted the U.S. patent system from a "first-to-invent" to a "first inventor to file" system. The first-to-invent systems offer a major disadvantage, a lengthy and costly process in cases of interference when two inventors file patent applications for the same invention. Changing towards a first-to-file system simplifies the patent prosecution process by awarding the patent to whoever files the application first. This system also offers a  significant advantage by eliminating the “secret prior art,” inventions for which the patent applications haven't been filed yet, consequently complicating the prior art search process. The increased wait time for inventors was noticed as a disadvantage since transitioning from a patent application to a patent issue takes two years on average. Nonetheless, the Leahy–Smith America Invents Act improved the patent prosecution process overall, and the past decade saw record patent application filings, including those originating from foreign countries.

After this act was passed, patent litigation increased to new levels as well, and so did the damage awards, which surpassed $1 billion on numerous occasions. One of the most important changes to the patent litigation process was the reform of the rules of the joinder of parties in a patent infringement suit. Before, it was possible to sue several defendants based only on the allegation that they have infringed the same patent, while after the Leahy–Smith America Invents Act, this became more difficult by introducing different conditions. In this way, the patent litigation lawsuits increased initially, due to the elimination of some patent infringement defenses previously available to the alleged infringers.

The Leahy–Smith America Invents Act had different effects on patent litigation since it also introduced new opposition procedures, such as the Inter Partes Reviews implemented on Sept., 16, 2012. During the past decade, patent litigation in district courts has risen considerably. After  the IPRs became popular, there was a decline in lawsuit fillings until the beginning of the pandemic, another major event of the past decade where the patent litigation trend changed positively again.