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Issue 05/38 | August 18, 2005
Proof of "Experimental Use"
 Proof of “Experimental Use” Requires Showing Control of Testing
By Inventor and Customer Awareness of The Testing

To avoid a finding of invalidity under the on-sale bar of 35 U.S.C. § 102(b) a patent owner who asserts “experimental use” must show: (1) the inventor’s control of the testing of the invention, and (2) customer awareness of the testing. In a recent case where a patent owner failed to prove these two “critical” factors, and had its patents held invalid under § 102(b), the Court discussed the types of evidence needed to prove that a pre-critical date sale was “primarily made for experimentation.” The checklist below, which is based on the Court’s discussion of what the inventors and patent owner did not do, may be useful to inventors and patent owners to decrease the likelihood of having their future patents found invalid under § 102(b).

A summary judgment of invalidity of U.S. Pat. Nos. 5,169,242 and 5,567,056 under the on-sale bar of § 102 was affirmed in Electromotive Division of General Motors Corp. v. Transportation Systems Division of General Electric Co., --- F.3d ---, 2005 WL 1774430 (Fed. Cir. July 28, 2005). The Court of Appeals for the Federal Circuit concluded that the bearing inventions claimed in the patents were the subject of commercial sales to several railroad customers more than one year prior to the dates of application for the two patents (i.e., pre-critical date sales). The question was whether the circumstances surrounding each of the pre-critical date sales objectively showed that the sales were “primarily made for experimentation.”

In concluding that there was insufficient objective evidence to show that the pre-critical date sales were primarily for experimentation, the Court referred to the list of 13 objective factors in Allen Engineering, 299 F.3d 1336, 1353 (Fed. Cir. 2002). After noting that the list is not exhaustive and that all factors may not apply in a particular case, the Court held that two factors are “critical” and must be proven if experimentation is to be found - - the inventor’s control over the alleged testing, and a customer’s awareness of the purported testing. Since the patent owner did not produce adequate evidence of either of these critical factors, both of its patents were held invalid. (If both critical factors had been shown, the Court would have considered the rest of the 13 factors listed in Allen Engineering.)

To decrease the likelihood of their future patents being found invalid based on an on-sale bar under § 102(b), inventors and patent owners who sell products including inventions “primarily for experimentation” should consider doing at least some of the following to help establish the inventor’s control and customer awareness of the inventor’s testing: 1) document the fact that the invention is being provided to the customer for the purpose of testing the invention in actual use rather than as part of a commercial sale; 2) have the customer sign a confidentiality agreement or other agreement consenting to participate in a field program; 3) provide protocols to the customer directing their use of the invention; 4) supervise or restrict the customer’s use of the invention; 5) require the customer to operate the invention under specific conditions; 6) monitor the conditions under which the customer uses the invention; 7) require the customer to provide feedback, such as comments or data concerning the operation or durability of the invention; 8) have the inventor, or someone under his direction (e.g., the customer), collect data, keep progress reports, and operate the invention during specified times; 9) maintain records of the testing or require the customer to do so; 10) control, monitor, or systematize the field testing of the invention; 11) examine the invention being tested in the field on a schedule; and 12) consider discounting the price of the invention sold for the purpose of experimentation.

To view the full decision visit http://www.fedcir.gov/opinions/04-1412.pdf.

To discuss this or any related intellectual property law topics further, please feel free to contact the author, James J. Kozuch, at jjkozuch@crbcp.com or 215-567-2010, ext. 133, at Caesar, Rivise, Bernstein, Cohen & Pokotilow, Ltd. (www.crbcp.com) in Philadelphia, PA, USA.

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