2133.03(e)   Permitted Activity; Experimental Use [R-3]

The question posed by the experimental use doctrine is "whether the primary purpose of the inventor at the time of the sale, as determined from an objective evaluation of the facts surrounding the transaction, was to conduct experimentation." Allen Eng’g Corp. v. Bartell Indus., Inc., 299 F.3d 1336, 1354, 63 USPQ2d 1769, 1780 (Fed. Cir. 2002), quoting EZ Dock v. Schafer Sys., Inc., 276 F.3d 1347, 1356-57, 61 USPQ2d 1289, 1295-96 (Fed. Cir. 2002) (Linn, J., concurring). Experimentation must be the primary purpose and any commercial exploitation must be incidental.

If the use or sale was experimental, there is no bar under 35 U.S.C. 102(b). "A use or sale is experimental for purposes of section 102 (b) if it represents a bona fide effort to perfect the invention or to ascertain whether it will answer its intended purpose.…If any commercial exploitation does occur, it must be merely incidental to the primary purpose of the experimentation to perfect the invention." LaBounty Mfg. v. United States Int’l Trade Comm’n, 958 F.2d 1066, 1071, 22 USPQ2d 1025, 1028 (Fed. Cir. 1992) (quoting Pennwalt Corp. v. Akzona Inc., 740 F.2d 1573, 1581, 222 USPQ 833, 838 (Fed. Cir. 1984)). "The experimental use exception…does not include market testing where the inventor is attempting to gauge consumer demand for his claimed invention. The purpose of such activities is commercial exploitation and not experimentation." In re Smith, 714 F.2d 1127, 1134, 218 USPQ 976, 983 (Fed. Cir. 1983).

2133.03(e)(1)    Commercial Exploitation [R-1]

One policy of the on sale and public use bars is the prevention of inventors from exploiting their inventions commercially more than 1 year prior to the filing of a patent application. Therefore, if applicant’s precritical date activity isa sale or offer for sale that is an attempt at market penetration, a patent is barred. Thus, even if there is bona fide experimental activity, an inventor may not commercially exploit an invention more than 1 year prior to the filing date of an application. In re Theis, 610 F.2d 786, 793, 204 USPQ 188, 194 (CCPA 1979).

  THE COMMERCIAL ACTIVITY MUST LEGITIMATELY ADVANCE DEVELOPMENT OF THE INVENTION TOWARDS COMPLETION

As the degree of commercial exploitation surrounding 35 U.S.C. 102(b)  activity increases, the burden on an applicant to establish clear and convincing evidence of experimental activity with respect to a public use becomes more difficult. Where the examiner has found a prima facie case of a sale or an offer to sell, this burden will rarely be met unless clear and convincing necessity for the experimentation is established by the applicant. This does not mean, of course, that there are no circumstances which would permit alleged experimental activity in an atmosphere of commercial exploitation. In certain circumstances, even a sale may be necessary to legitimately advance the experimental development of an invention if the primary purpose of the sale is experimental. In re Theis, 610 F.2d 786, 793, 204 USPQ 188, 194 (CCPA 1979); Robbins Co. v. Lawrence Mfg. Co., 482 F.2d 426, 433, 178 USPQ 577, 582 (9th Cir. 1973). However, careful scrutiny by the examiner of the objective factual circumstances surrounding such a sale is essential. See Ushakoff v. United States, 327 F.2d 669, 140 USPQ 341 (Ct.Cl. 1964); Cloud v. Standard Packaging Corp., 376 F.2d 384, 153 USPQ 317 (7th Cir. 1967).

  SIGNIFICANT FACTORS INDICATIVE OF "COMMERCIAL EXPLOITATION"

As discussed in MPEP § 2133.03, a policy consideration in questions of 35 U.S.C. 102(b)  activity is premature "commercial exploitation" of a "completed" or "ready for patenting" invention (see MPEP § 2133.03(c)). The extent of commercial activity which constitutes 35 U.S.C. 102(b)  "on sale" status depends upon the circumstances of the activity, the basic indicator being the subjective intent of the inventor as manifested through objective evidence. The following activities should be used by the examiner as indicia of this subjective intent:

    • (A) Preparation of various contemporaneous "commercial" documents, e.g., orders, invoices, receipts, delivery schedules, etc.;
    • (B) Preparation of price lists (Akron Brass Co. v. Elkhart Brass Mfg. Co., 353 F.2d 704, 709, 147 USPQ 301, 305 (7th Cir. 1965) and distribution of price quotations (Amphenol Corp. v. General. Time Corp., 158 USPQ 113, 117 (7th Cir. 1968));
    • (C) Display of samples to prospective customers (Cataphote Corp. v. DeSoto Chemical Coatings, Inc., 356 F.2d 24, 27, 148 USPQ 527, 529 (9th Cir. 1966) mod. on other grounds, 358 F.2d 732, 149 USPQ 159 (9th Cir.), cert. denied, 385 U.S. 832 (1966); Chicopee Mfg. Corp. v. Columbus Fiber Mills Co., 165 F.Supp. 307, 323-325, 118 USPQ 53, 65-67 (M.D.Ga. 1958));
    • (D) Demonstration of models or prototypes (General Elec. Co. v. United States, 206 USPQ 260, 266-67 (Ct. Cl. 1979); Red Cross Mfg. v. Toro Sales Co., 525 F.2d 1135, 1140, 188 USPQ 241, 244-45 (7th Cir. 1975); Philco Corp. v. Admiral Corp., 199 F. Supp. 797, 815-16, 131 USPQ 413, 429-30 (D.Del. 1961)), especially at trade conventions (InterRoyal Corp. v. Simmons Co., 204 USPQ 562, 563-65 (S.D. N.Y. 1979)), and even though no orders are actually obtained (Monogram Mfg. v. F. & H. Mfg.,144 F.2d 412, 62 USPQ 409, 412 (9th Cir. 1944));
    • (E) Use of an invention where an admission fee is charged (In re Josserand, 188 F.2d 486, 491, 89 USPQ 371, 376 (CCPA 1951); Greenewalt v. Stanley, 54 F.2d 195, 12 USPQ 122 (3d Cir. 1931)); and
    • (F) Advertising in publicity releases, brochures, and various periodicals (In re Theis, 610 F.2d 786, 792 n.6, 204 USPQ 188, 193 n. 6 (CCPA 1979); InterRoyal Corp. v. Simmons Co., 204 USPQ 562, 564-66 (S.D.N.Y.1979); Akron Brass, Inc. v. Elkhart Brass Mfg., Inc., 353 F.2d 704, 709, 147 USPQ 301, 305 (7th Cir.1965); Tucker Aluminum Prods. v. Grossman, 312 F.2d 393, 394, 136 USPQ 244, 245 (9th Cir. 1963)).

>See MPEP § 2133.03(e)(4) for factors indicative of an experimental purpose.<

2133.03(e)(2)    Intent

"When sales are made in an ordinary commercial environment and the goods are placed outside the inventor’s control, an inventor’s secretly held subjective intent to ‘experiment,’ even if true, is unavailing without objective evidence to support the contention. Under such circumstances, the customer at a minimum must be made aware of the experimentation." LaBounty Mfg., Inc. v. United States Int’l Trade Comm’n, 958 F.2d 1066, 1072, 22 USPQ2d 1025, 1029 (Fed. Cir. 1992) (quoting Harrington Mfg. Co. v. Powell Mfg. Co., 815 F.2d 1478, 1480 n.3, 2 USPQ2d 1364, 1366 n.3 (Fed. Cir. 1986); Paragon Podiatry Laboratory, Inc. v. KLM Labs., Inc., 984 F.2d 1182, 25 USPQ2d 1561 (Fed. Cir. 1993) (Paragon sold the inventive units to the trade as completed devices without any disclosure to either doctors or patients of their involvement in alleged testing. Evidence of the inventor’s secretly held belief that the units were not durable and may not be satisfactory for consumers was not sufficient, alone, to avoid a statutory bar.).

2133.03(e)(3)    "Completeness" of the Invention [R-3]

I.    EXPERIMENTAL USE ENDS WHEN THE INVENTION IS ACTUALLY REDUCED TO PRACTICE

Experimental use "means perfecting or completing an invention to the point of determining that it will work for its intended purpose." Therefore, experimental use "ends with an actual reduction to practice." RCA Corp. v. Data Gen. Corp., 887 F.2d 1056, 1061, 12 USPQ2d 1449, 1453 (Fed. Cir. 1989). If the examiner concludes from the evidence of record that an applicant was satisfied that an invention was in fact "complete," awaiting approval by the applicant from an organization such as Underwriters’ Laboratories will not normally overcome this conclusion. InterRoyal Corp. v. Simmons Co., 204 USPQ 562, 566 (S.D.N.Y. 1979); Skil Corp. v. Rockwell Manufacturing Co., 358 F. Supp. 1257, 1261, 178 USPQ 562, 565 (N.D.Ill. 1973), aff’d. in part, rev’d in part sub nom. Skil Corp. v. Lucerne Products Inc., 503 F.2d 745, 183 USPQ 396, 399 (7th Cir. 1974), cert. denied, 420 U.S. 974, 185 USPQ 65 (1975). See MPEP § 2133.03(c) for more information of what constitutes a "complete" invention.

The fact that alleged experimental activity does not lead to specific modifications or refinements of an invention is evidence, although not conclusive evidence, that such activity is not within the realm permitted by the statute. This is especially the case where the evidence of record clearly demonstrates to the examiner that an invention was considered "complete" by an inventor at the time of the activity. Nevertheless, any modifications or refinements which did result from such experimental activity must at least be a feature of the claimed invention to be of any probative value. In re Theis, 610 F.2d 786, 793, 204 USPQ 188, 194 (CCPA 1979).

II.    DISPOSAL OF PROTOTYPES

Where a prototype of an invention has been disposed of by an inventor before the critical date, inquiry by the examiner should focus upon the intent of the inventor and the reasonableness of the disposal under all circumstances. The fact that an otherwise reasonable disposal of a prototype involves incidental income is not necessarily fatal. In re Dybel, 524 F.2d 1393, 1399, n.5, 187 USPQ 593, 597 n.5 (CCPA 1975). However, if a prototype is considered "complete" by an inventor and all experimentation on the underlying invention has ceased, unrestricted disposal of the prototype constitutes a bar under 35 U.S.C. 102(b). In re Blaisdell, 242 F.2d 779, 113 USPQ 289 (CCPA 1957); contra, Watson v. Allen, 254 F.2d 342, 117 USPQ 68 (D.C. Cir. 1958).

2133.03(e)(4)    Factors Indicative of an Experimental Purpose [R-5]

The courts have considered a number of factors in determining whether a claimed invention was the subject of a commercial offer for sale primarily for purposes of experimentation. "These factors include: (1) the necessity for public testing, (2) the amount of control over the experiment retained by the inventor, (3) the nature of the invention, (4) the length of the test period, (5) whether payment was made, (6) whether there was a secrecy obligation, (7) whether records of the experiment were kept, (8) who conducted the experiment, ... (9) the degree of commercial exploitation during testing[,] ... (10) whether the invention reasonably requires evaluation under actual conditions of use, (11) whether testing was systematically performed, (12) whether the inventor continually monitored the invention during testing, and (13) the nature of contacts made with potential customers." Allen Eng’g Corp. v. Bartell Indus., Inc., 299 F.3d 1336, 1353, 63 USPQ2d 1769, 1780 (Fed. Cir. 2002) quoting EZ Dock v. Schafer Sys., Inc., 276 F.3d 1347, 1357, 61 USPQ2d 1289, 1296 (Fed. Cir. 2002) (Linn, J., concurring). Another critical attribute of experimentation is the "customer’s awareness of the purported testing in the context of a sale." Electromotive Div. of Gen. Motors Corp. v. Transportation Sys. Div. of Gen. Elec. Co., 417 F.3d 1203, 1241, 75 USPQ2d 1650, 1658 (Fed. Cir. 2005).

Once alleged experimental activity is advanced by an applicant to explain a prima facie case under 35 U.S.C. 102(b), the examiner must determine whether the scope and length of the activity were reasonable in terms of the experimental purpose intended by the applicant and the nature of the subject matter involved. No one of, or particular combination of, factors is necessarily determinative of this purpose.

See MPEP § 2133.03(e)(1) for factors indicative of commercial exploitation.

2133.03(e)(5)    Experimentation and Degree of Supervision and Control [R-5]

  THE INVENTOR MUST MAINTAIN SUFFICIENT CONTROL OVER THE INVENTION DURING TESTING BY THIRD PARTIES

Thesignificant determinative factors in questions of experimental purpose are the extent of supervision and control maintained by an inventor over an invention during an alleged period of experimentation , and the customer’s awareness of the experimentation. Electromotive Div. of Gen. Motors Corp. v. Transportation Sys. Div. of Gen. Elec. Co., 417 F.3d 1203, 1214,75 USPQ2d 1650, 1658 (Fed. Cir. 2005)("control and customer awareness ordinarily must be proven if experimentation is to be found"). Once a period of experimental activity has ended and supervision and control has been relinquished by an inventor without any restraints on subsequent use of an invention, an unrestricted subsequent use of the invention is a 35 U.S.C. 102(b)  bar. In re Blaisdell, 242 F.2d 779, 784, 113 USPQ 289, 293 (CCPA 1957).

2133.03(e)(6)    Permitted Experimental Activity and Testing [R-3]

I.    DEVELOPMENTAL TESTING IS PERMITTED

Testing of an invention in the normal context of its technological development is generally within the realm of permitted experimental activity. Likewise, experimentation to determine utility, as that term is applied in 35 U.S.C. 101, may also constitute permissible activity. See General Motors Corp. v. Bendix Aviation Corp., 123 F. Supp. 506, 521, 102 USPQ 58, 69 (N.D.Ind. 1954). For example, where an invention relates to a chemical composition with no known utility, i.e., a patent application for the composition could not be filed (35 U.S.C. 101; 35 U.S.C. 112, first paragraph), continued testing to find utility would likely be permissible under 35 U.S.C. 102(b), absent a sale of the composition or other evidence of commercial exploitation.

II.    MARKET TESTING IS NOT PERMITTED

Experimentation to determine product acceptance, i.e., market testing, is typical of a trader’s and not an inventor’s experiment and is thus not within the area of permitted experimental activity. Smith & Davis Mfg. Co. v. Mellon, 58 F. 705, 707 (8th Cir. 1893) Likewise, testing of an invention for the benefit of appeasing a customer, or to conduct "minor ‘tune up’ procedures not requiring an inventor’s skills, but rather the skills of a competent technician," are also not within the exception. In re Theis, 610 F.2d 786, 793, 204 USPQ 188, 193-94 (CCPA 1979).

III.    EXPERIMENTAL ACTIVITY IN THE CONTEXT OF DESIGN APPLICATIONS

The public use of an ornamental design which is directed toward generating consumer interest in the aesthetics of the design is not an experimental use. In re Mann, 861 F.2d 1581, 8 USPQ2d 2030 (Fed. Cir. 1988) (display of a wrought iron table at a trade show held to be public use). However, "experimentation directed to functional features of a product also containing an ornamental design may negate what otherwise would be considered a public use within the meaning of section 102(b)." Tone Brothers, Inc. v. Sysco Corp., 28 F.3d 1192, 1196, 31 USPQ2d 1321, 1326 (Fed. Cir. 1994) (A study wherein students evaluated the effect of the functional features of a spice container design may be considered an experimental use.).

2133.03(e)(7)    Activity of an Independent Third Party Inventor

  EXPERIMENTAL USE EXCEPTION IS PERSONAL TO AN APPLICANT

The statutory bars of 35 U.S.C. 102(b)  are applicable even though public use or on sale activity is by a party other than an applicant. Where an applicant presents evidence of experimental activity by such other party, the evidence will not overcome the prima facie case under 35 U.S.C. 102(b)  based upon the activity of such party unless the activity was under the supervision and control of the applicant. Magnetics v. Arnold Eng’g Co., 438 F.2d 72, 74, 168 USPQ 392, 394 (7th Cir. 1971), Bourne v. Jones, 114 F.Supp. 413, 419, 98 USPQ 206, 210 (S.D. Fla. 1951), aff'd., 207 F.2d 173, 98 USPQ 205 (5th Cir. 1953), cert. denied, 346 U.S. 897, 99 USPQ 490 (1953); contra, Watson v. Allen, 254 F.2d 342, 117 USPQ 68 (D.C.Cir. 1957). In other words, the experimental use activity exception is personal to an applicant.