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Federal Circuit Holds That "Secret" Sales and Offers for Sale May Constitute Prior Art Under Post-AIA Section 102

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On May 1, 2017, the Federal Circuit issued its opinion in Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA, Inc., Nos. 2016-1284 and 2016-1787 (Fed. Cir. May 1, 2017). In a panel decision authored by Judge Dyk, the Court held that sales or offers for sale that do not publically disclose the details of an invention may still qualify as prior art for post-AIA patents. Notably, the USPTO has been operating under the presumption that such sales or offers for patents filed after March 16, 2013 are not prior art. See, e.g., M.P.E.P. § 2152.

Before the passage of the AIA, both the Supreme Court and the Federal Circuit held that “secret” prior art (such as certain uses, sales, or offers for sale) may serve as invalidating prior art without disclosing the “details of the invention” to the public. Slip Op. at 22-23. In enacting the AIA, Congress amended § 102 to prohibit patenting of an “invention [that] was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.” 35 U.S.C. § 102(a)(1) (emphasis added). Helsinn (the patentee) argued that by including the phrase “or otherwise available to the public,” Congress legislatively repealed the jurisprudence allowing for the use of “secret” prior art. Slip Op. at 22.

The Federal Circuit rejected Helsinn’s argument as overbroad. Helsinn relied primarily on several floor statements suggesting that Congress intended to prevent “secret” prior art from invalidating a patent. Slip Op. at 20-21. The Federal Circuit reviewed these statements, and determined that they were all directed to secret “uses,” not to secret “sales” or “offers for sale.” Id. Because the issue of secret “use” was not raised in this case, the Court did not determine whether the AIA excludes “secret uses” from serving as prior art. Id.

With respect to whether “sales” or “offers for sale” must disclose details of the invention, the Federal Circuit found “no indication” that Congress intended to overrule the Court’s prior cases. Slip Op. at 26. The Court reasoned that, “[i]f Congress intended to work such a sweeping change to our on-sale bar jurisprudence and wished to repeal these prior cases legislatively, it would do so by clear language.” Id. (quotations omitted). Accordingly, “after the AIA, if the existence of the sale is public, the details of the invention need not be publicly disclosed in the terms of sale.” Id. at 27.

The Federal Circuit did not address the circumstance in which a sale (or offer) is itself “secret,” as opposed to a publically known sale that fails to disclose the “details of the invention.” Rather, in Helsinn, there was no dispute that the sale itself (which was announced in a public filing) was public. Slip Op. at 21. Therefore, the Court noted that “[e]ven if the floor statements were intended to overrule [pre-AIA] secret or confidential sale cases … that would have no effect here since those cases were concerned entirely with whether the existence of a sale or offer was public.” Id. The Court’s reasoning leaves open whether the AIA changed the law with respect to non-public sales or offers, whether or not such sales disclose the “detail of the invention.”


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