What Do Strategic Prosecution & Blackjack Strategy Have In Common?


 by: Patrick Anderson | March 15, 2018

Are you “splitting 10’s” by filing serial CONs?

While patent prosecution mystifies many people, few things are more mystifying (particularly to our European and Asian counterparts) than American continuation practice. Europeans, for example, have the option to file a divisional application once they receive a patent grant from the EPO. However, the filing fees are expensive, and DIVs (as they are known) are rare. However, in US practice, CONs are comparatively inexpensive, and it’s not uncommon for prosecution counsel to file CONs as a matter of course after every allowance.

Stop me if you’ve heard (or said) this before: “Well, I don’t really know what I want to claim, but I’d like to keep something alive in this family.” Some patent owners even file the so-called “no-fee CON,” which is somewhat, but not quite, like what it sounds. A patentee is granted a filing date even without paying the associated filing fees. It will take the USPTO a few weeks to realize the omission, at which time they’ll send you a notice giving you another 2 months to come up with the cash.

This strategy, however, can backfire. In Blackjack, players are normally allowed to “split” hands when dealt a pair. For example, if you’re dealt two 8’s, you can split each 8 into it’s own hand, effectively playing two hands, instead of just one. If you draw a 10 on each new hand, you now have two hands of 18, instead of a single hand of 16, increasing your chances of beating the dealer. Some players, however, follow an ill-advised strategy of splitting 10’s, which takes a very strong single hand of 20 in favor of two less certain outcomes.

Card counters sometimes employ this strategy if the odds suggest a large number of 10-value cards are left in the deck, because two hands of 20 are better than one, right? Occasionally, players might serially split as they continue draw face cards, but each high value card lowers the count and reduces the chance of a dealer busting. Even while holding seventeen hands of 20 each, you’re going to lose if the dealer draws a seven card “21.”

The risk in serial CONs is similar, with the practice eventually reaching a point of diminishing returns, at best.  Keeping a family “alive” is often said to “add leverage” in licensing discussions, and it does … to a point. For instance, if an infringing company prefers to file an IPR rather than agree to license the portfolio, each additional patent will require a separate institution and, consequently, a separate institution fee. However, since a CON is limited to the subject matter of the original disclosure, claims can quickly “tap out,” resulting in multiple patents with very similar claim language. If an IPR successfully invalidates one claim set, you’ll need a viable argument for patentability of similar claim sets.

At worst, however, serial CONs risk becoming counterproductive. For instance, another side-effect is the requirement for terminal disclaimers. Because serial CONs tend to result in similar claims, filings tend to provoke “obviousness-type double patenting” rejections. While these rejections are easy to overcome, they carry consequences. A statement by the patent office that inventions are “not patentably distinct” tends to tie patentability decisions of multiple patents together in the eyes of a District Court, which means several patents might actually stand (or fall) together. Furthermore, serial CONs risk the dreaded “death action.”  This happens when the examiner decides both that your claims are indistinct from a previously-filed claim set and that your current claims are not eligible under 101. This action puts the patent owner in a corner with little means for escape. In theory, the patent owner can amend the pending claims to overcome the rejection, but infringers will pounce on this action as an outright admission that the claims of issued patents are ineligible as written (with no viable means of amendment). The only way to secure eligibility of the issued and pending claims is to overcome the 101 rejection through argument—a much tougher road, for sure.

Thus, patent owners should carefully weigh the actual value added of each subsequent CON when employing a serial CON strategy to account for these risks. Routinely adding CONs without such regard is not strategic, could end up adding only expense without value, and, at worst, actually detract from the value of a licensing effort.

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