Tax Strategy Patent Reexamination Continues Despite AIA Provision

Back in January of 2011, the Director of the USPTO initiated reexamination of U.S. Patent 6,567,790 (here), which claims a method of minimizing transfer tax liability. In 2007, the ‘790 Patent was asserted against a corporate officer of Aetna Inc, the case was settled for an undisclosed amount. The Director initiation of the ‘790 Patent reexamination was noteworthy (i.e., independent of a Patentee or Third Party request) as such an agency driven action had not occurred since the 2004 time frame.

Thereafter, the America Invents Act (AIA) was passed into law on September 16, 2011.

The AIA includes Section 14, entitled “Tax Strategies Deemed Within the Prior Art.” This section unequivocally states, as a matter of law, that patent claims directed to a strategy for reducing, avoiding or deferring tax liability are deemed to be within the prior art. This statute applies to all applications existing before or after the date of enactment (9/16/11), but only applies to those patents issued on or after the date of enactment. (USPTO Memo of September 20, 2011 providing guidance to the Examining Corps here). The ‘790 Patent was issued in 2003.

As a reminder, patent reexaminatons are not applications for patents.

While the ‘790 Patent would almost certainly be subject to challenge under the Transitional Program for Covered Business Method Patents (TPCBMP) on September 16, 2012, currently, the USPTO reexamination result appears to have saved the investment banking community some money. (Final action here)