Introduction

On October 1, 2018, the United States Court of Appeals for the Federal Circuit (“Federal Circuit”) made a decision in Natural Alternatives International, Inc. v. Andrei Iancu. Starting December 2011, Natural Alternatives International, Inc. (“NAI”) was in district court litigation with Woodbolt Distributors, LLC (“Woodbolt”). In May 2012, Woodbolt requested inter partes review of NAI’s Patent No. 8,067,381 (“the ‘381 Patent”), issued from the last of eight patent applications filed by NAI between 1997 and 2011. While the first through sixth applications each initially correctly claimed priority to the preceding applications, NAI amended the “Cross Reference of Related Applications” section of only the fifth application, disclaiming priority to the fourth through first applications, and only claiming priority to a provisional application filed during the pendency of the fourth. However, this amendment was not made in the sixth application or the subsequent seventh and eight applications. With this break in the priority chain as a platform, Woodbolt requested inter partes review of the ‘381 Patent. In defense, NAI averred that this break is irrelevant to the later filed applications as the sixth application claims priority to the fourth through first applications. Unpersuaded, the examiner rejected the reexamined claims in view of prior art, including Patent No. 5,965,596, NAI’s patent issued from their first filed application. Natural Alternatives appealed to the Patent and Trial Appeal Board, who affirmed the examiner’s decision and denied NAI a rehearing. NAI then appealed to the Federal Circuit.

Decision

NAI presented its argument to the Federal Circuit in four parts. First, NAI asserts that the ‘381 Patent’s priority to the first application was secured as the complete priority chain was invoked in the sixth application once the application met all criteria. Second, NAI claims that a waiver of priority is only applicable to the instant application and not subsequent filings. Third, NAI presses that “the Board erroneously viewed priority as a single growing chain rather than multiple fixed chains.” Fourth, given their third argument, having such a view “‘limits an applicant’s ability to seek protection’” when “‘amending a priority claim to gain [patent] term’” (6).

In response to NAI’s first point, the Federal Circuit strongly affirms that “amending an earlier filed parent application may affect the priority of its child applications” (9). While the eighth application claimed priority to the first application, it did not meet the requirements entitling its claim to priority benefits as the fifth application lacked priority to the first. Addressing NAI’s second point, the Federal Circuit emphasizes that while the MPEP reads, “‘[a] cancellation of a benefit claim to a prior application may be considered as a showing that the applicant is intentionally waiving the benefit claim to the prior application in the instant application,” understanding the rule as being applicable only to the instant application is too narrow; there is no language limiting the scope of this rule to only the instant application (10). Towards NAI’s third point, “The Supreme Court has previously explained that under § 120, parent and continuing applications ‘are to be considered as parts of the same transaction, and both as constituting one continuous application, within the meaning of the law’” (12). Finally, in response to NAI’s fourth point, the Federal Circuit maintains that by voluntarily omitting a priority claim to avoid losing patent term, the Applicant must accept the loss of benefits to claiming priority, including the possibility of a parent application being used as prior art. Thus, for the aforementioned reasons, the Federal Circuit affirmed the Board's decision.

Conclusion

In conclusion, Applicants should carefully consider the use of priority claims. As demonstrated in this case, any break in the chain could jeopardize the validity of subsequent patents.

Full Natural Alternatives v. Iancu decision can be read here: http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/17-1962.Opinion.10-1-2018.pdf

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