A Federal Circuit ruling left the on-sale bar in U.S. patent law largely intact under the America Invents Act (AIA), rejecting arguments to limit its application when a patented process is kept secret. In Celanese International Corp. v. International Trade Commission, 111 F.4th 1338 (Fed. Cir. 2024), the court held that the on-sale bar applies to processes that were not publicly disclosed so long as it is commercially exploited prior to the bar date. The decision highlights a sharp contrast between U.S. patent law and international practices, fueling Celanese's recent petition to the U.S. Supreme Court, filed this past December.
In Celanese, the court reviewed whether commercializing a product created by a secret chemical process before the critical filing date could invalidate a patent claim to that process. Celanese argued that the 2011 AIA revisions—particularly the change from "invention" to "claimed invention" and the addition of "otherwise available to the public" in 35 U.S.C. § 102—should exempt undisclosed, secret commercial uses of patented processes from triggering the on-sale bar. After all, the process is the "claimed invention" that remained secret and was not itself put on sale.
Among other reasons, Celanese pointed to AIA § 3(p), which explains Congress's intent for the AIA was to harmonize U.S. patent law with the patent systems used in most other countries where similar facts would not generally trigger the bar. Nonetheless, the Federal Circuit dismissed this argument, affirming that the on-sale bar still applies even if the specifics of the process are not disclosed to the public.
This stance highlights a key divergence from international norms, where other jurisdictions might permit secret commercial uses without invalidating patents. In many major patent systems worldwide, the absence of public disclosure often means such pre-filing uses do not impact a patent's validity. By contrast, the Federal Circuit's decision in this case means the United States applies a stricter interpretation, with the on-sale bar encompassing even non-public uses of patented processes if the product created by the process is commercialized. Celanese's petition highlights this difference in its push for Supreme Court review, which could redefine how U.S. patent law aligns with global practices and affect foreign entities operating under the U.S. patent framework.
Beyond application to secret processes, the U.S. on-sale bar has many complexities. For example, an earlier decision in Medicines Company v. Hospira, 827 F.3d 1363 (Fed. Cir. 2016), further demonstrates the nuances in the U.S. patent system. There, the Federal Circuit distinguished between a "commercial sale" and contract manufacturing. The court differentiated between when an inventor contracts for a manufacturer's services to create a patented product versus contracting for the purchase of the product from the manufacturer. Supporting this distinction, the court noted the inventor retained title in the prior arrangement, although that is not dispositive. This distinction allows inventors to retain patent protections if manufacturing agreements are carefully structured as service contracts rather than sales agreements, adding subtlety for companies that use external manufacturers.
These decisions collectively underscore that U.S. patent holders must navigate the U.S. patent system with the many differences from international systems in mind. With Celanese's petition to the Supreme Court pending, the potential for a shift toward alignment with global standards remains open but uncertain. For foreign companies seeking U.S. patent protections, these rulings reinforce the need to understand the nuances of the on-sale bar and structure pre-filing commercial arrangements accordingly.
For now, patent applicants and practitioners should carefully track the dates of any commercial sales involving products made using an inventive process and docket filing an application covering the process within one year to avoid triggering the on-sale bar. Should the Supreme Court grant Celanese's petition, it could set a new precedent harmonizing U.S. patent law with international norms on secret commercial use of patented processes. Until then, intellectual property owners should remain cautious as pre-filing commercial activities involving patented processes may still jeopardize U.S. patents, even when confidentiality is maintained.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
