The nature of the patent infringement defense of “prior commercial use” has changed with AIA, affecting patent values


AIA expanded the prior commercial use defense in patent litigation from just applying to business methods to now including other categories of patents. The defense also now requires commercial use more than one year prior to the patent’s filing or disclosure date.  Finally, the defense has been broadened to include affiliated companies. W. Edward Ramage of Bake Donelson Bearman Caldwell & Berkowitz, PC, writes in IAM Magazine that “the broadening of its scope should exert a downward pressure on patent values by making the defense available to more defendants.”

Here it gets interesting. AIA provides that the prior commercial use defense cannot be used in cases where “at the time that the claimed invention was made, it was owned by or subject to an obligation of assignment to either a higher education institution or a technology transfer organization.” Therefore, patents will be more valuable (comparatively) if owned by a research institutions or a technology transfer department.


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