So when did submarine patents first begin to emerge? According to Herb Wamsley, executive director of the Intellectual Property Owners Association, the phenomenon probably started when the PTO began offering inventors the option to refile their patent applications. Back in the 1940s, the PTO would only review a patent application twice. If the application failed after two reviews, it was rejected and no patent was issued. This practice meant that applicants would lose their valuable early filing date. If applicants wanted a third review, a new application had to be completed, and it was assigned a new, later filing date.
Because so many patents were being rejected, the PTO eventually decided to allow patent applications to be refiled for an additional fee without losing their valuable early filing dates. Because they could now be refiled, patents sometimes remained in the PTO system for years before they were finally issued.
As the previous examples show, once a submarine patent surfaces, it can be very costly to companies unaware of its existence. This situation has led both the Senate and House to write reform bills that are still pending in Congress. One recommendation is that patent applications should be published for public review 18 months after being filed with the PTO. However, most individual inventors fear the secrecy enjoyed during the patent-pending stage could potentially be destroyed.
But many legal experts support the concept of early publication. Bob Chiaviello, a patent attorney with Baker & Botts in Dallas, believes it's a good idea for two reasons: First, publication of pending patents would make the United States' patent laws consistent with those of other countries; and second, it would offer a level of comfort to businesses that fear surprise patents might surface for technologies they're developing.
Today, some patent-filing reforms have been achieved. Currently, patents filed after 1995 have a 20-year term, but the term begins on the patent filing date. If a patent takes 10 years to issue, for example, the patent will only have a remaining term of 10 years (unless the patent qualifies for the five-year Patent Term Extension). This modification provides some insurance against submarine patents. But because technology is changing so rapidly, a patent popping up 10 years after a product hits the market could still have a devastating impact on an industry.
Although some inventors will tell you that owning a submarine patent is like winning the lottery, others would disagree. Like many windfall profits, it's the consumer who ultimately pays--in higher prices. And as an inventor, I have a problem with people who profit from ideas they didn't actually develop. It doesn't seem fair that the person who takes the time, energy and risk to pursue an idea, and then markets that idea, should have to share his or her profits with someone who invested little but filed first. The fact that submarine patents may be lurking is something to remember the next time you approach the PTO with an invention.
Baker & Botts, (214) 953-6677, firstname.lastname@example.org
Intellectual Property Owners Association, fax: (202) 466-2893, email@example.com