On-Sale Bar

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On-Sale Bar

• Sale or offer for sale
• Traditionally, required (1) reduction to
  practice, and (2) sale or offer for sale
• Now, no reduction to practice required- if you
  sell an uncompleted product, it may bar a patent
  if the application is filed more than 1 year
  later.
• See Pfaff v. Wells Electronics, Inc.

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Pfaff v. Wells
4/8/81
Pfaff Files Patent Application
Order Filled
The Critical Date for the Patent Application
Texas Instruments places P.O. for 30,100 new
chip carriers
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On Sale Bar Litigation Issues

• Sale can be completely confidential and still bar
  the patent
• A truly secret form of prior art
• Discovery is obviously crucial
• Spending time with the shoeboxes . . .

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• It is evident that Pfaff could have obtained a
  patent on his novel socket when he accepted the
  purchase order from Texas Instruments for 30,100
  units. At that time he provided the manufacturer
  with a description and drawings that had
  "sufficient clearness and precision to enable
  those skilled in the matter" to produce the
  device.
• -- 525 U.S. 55, 63

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Group One, Ltd. v. Hallmark Cards, Inc.254 F.3d
1041C.A.Fed.,2001.

• We will look to the Uniform Commercial Code
  ("UCC") to define whether, as in this case, a
  communication or series of communications rises
  to the level of a commercial offer for sale.

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Hallmark Cards

• Because of the importance of having a uniform
  national rule regarding the on-sale bar, we hold
  that the question of whether an invention is the
  subject of a commercial offer for sale is a
  matter of Federal Circuit law, to be analyzed
  under the law of contracts as generally
  understood.

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Problems with Hallmark?

• Lacks "(1) vigorously solicited wheel
  manufacturers to whom Lacks could sell overlays
  and on whose wheels Lacks could perform its
  overlay- bonding method, and (2) vigorously
  solicited original equipment manufacturers to
  specify and purchase wheels clad by the
  later-patented method."

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• The Special Master did not find this activity,
  nor any other of Lacks' activities, to be a
  commercial offer for sale as defined by contract
  law.
• Lacks Industries, Inc. v. McKechnie 322 F.3d
  1335, 1348 (Fed. Cir. 2003)