The PTO recently announced final rules regarding the new derivation proceedings, 37 C.F.R. Part 42, pursuant to the Smith-Leahy America Invents Act.

As practitioners are well aware, the AIA will transform the U.S. from a first-to-invent to a first-to-file patent system on March 16, 2013, aligning the U.S. with the European and Japanese systems. For all applications filed on or after March 16, 2013, under the first-to-file system, interference proceedings, which are used to determine “which [of two] part[ies] first invented [a] commonly claimed invention,” will become obsolete. Derivation proceedings will in part replace current interference practice, but will likely be applicable in a much narrower set of circumstances.

The new derivation proceedings will address scenarios where a party “derived” an idea from the actual inventor, and then was the first to file a patent application. The true inventor – the petitioner – will be able to petition for a so-called “derivation proceeding,” in order to demonstrate that the party who was first to file – the respondent – derived the invention from the petitioner.

A petition for derivation proceeding must show that at least one claim of the petitioner’s patent is the “same or substantially the same as the respondent’s claimed invention; and . . . [t]he same or substantially the same as the invention disclosed to the respondent.” 37 C.F.R. § 42.405. The petition must be filed within one year from publication of the petitioner’s application that claims the same or substantially same invention as the respondent’s earlier filed application.

The new rules set forth that to prevail in such a derivation proceeding, the petitioner faces the burden of proving upon “substantial evidence” that the first to file patentee was told of the invention and was not authorized to file a patent application. The rules also require that the purported true inventor’s testimony must be corroborated by a noninventor. Thus, the bar for proof of derivation will likely be high.

What does this mean for practitioners and inventors? At the least, scrupulous record keeping and clear agreements must be the order of the day when in a joint development or other cooperative research setting.