In the recent case of Wyeth v. Kappos, the Federal Circuit held that the U.S. Patent and Trademark Office (USPTO) has been erroneously under-calculating the period of permissible adjustment to a patent’s term resulting from USPTO delays in issuing the patent. As a result, the USPTO has recently instituted an interim procedure to permit patentees to potentially extend the term of their patents. Because this interim procedure will expire on March 1, 2010, patent owners who have not yet reviewed their portfolio for potential patent term adjustment errors should do so immediately.

The patent term extension statute, 35 U.S.C. § 154, permits a term adjustment for two reasons: (1) Where the USPTO fails to meet particular deadlines set out in the statute, one day for each day of delay (Type “A” delay), and (2) where the USPTO fails to issue the patent within three years of filing, one day for each day beyond the three years (Type “B” delay). According to the statute, situations where delay falls within both Type A and B delay (i.e. overlapping delay) cannot be counted twice for purposes of calculating the extended term.

Before Wyeth v. Kappos, the USPTO had been calculating the patent term adjustment as the arithmetical difference between Type A delay and Type B delay. Wyeth asserted that the patent term adjustment for its patents should be calculated as the sum of Type A delay and Type B delay minus any “overlap” of Type A delay that occurs during Type B delay, i.e., that the potential for overlapping A delay and B delay can only begin after 3 years from the actual filing date.

The Federal Circuit held that the USPTO’s method of calculating delay was erroneous. The Court stated that the statute requires that the period for Type B delay starts three years after filing and ends with the issuance of the patent. Thus, the USPTO’s calculation was in error for subtracting days for Type B delay from Type A delay that occurred within 3 years of the filing date. The result in the case was that Wyeth was entitled to a 756 day adjustment (as requested by Wyeth), not the 462 day adjustment as determined by the USPTO.

In view of the Federal Circuit's decision in Wyeth, the USPTO has implemented an interim procedure for patentees to request a recalculation of a patent term adjustment. Until March 1, 2010, patentees can request (without a fee) a patent term adjustment recalculation using a form issued by the USPTO: Request for Recalculation of Patent Term Adjustment in View of Wyeth. According to the USPTO's interim procedure, a patentee may request a patent term adjustment if: (1) the patent issued before March 2, 2010, (2) the sole basis for requesting reconsideration of the patent term adjustment is based on Wyeth, and (3) the request is filed within 180 days of the day the patent was granted. The USPTO has stated that its computer program for calculating patent term adjustment will be updated by March 2, 2010. Thus, for patents issuing after March 1, 2010, a request for a recalculated patent term adjustment must be filed as a request for reconsideration under 37 C.F.R. § 1.795(d) that complies with the requirements of 37 C.F.R. 1.705(b)(1) and (b)(2) within two months of the date the patent issued.

Patent owners should therefore immediately review their portfolio of recently-issued patents. If any of those patents issued more than three years after the filing date, they should be reviewed for delays in prosecution. Under Wyeth, such patents may be subject to an increased patent term adjustment, allowing the patent owner to extend his valuable monopoly.