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The Best Mode Trap: Why a Valid U.S. Patent Might Face Trouble in Australia

June 12, 2026

Many U.S. patent applicants have never given much thought to the “best mode” requirement. That’s understandable. While U.S. patent law still technically requires inventors to disclose the best way of practicing their invention, Congress removed the penalty for failing to do so more than a decade ago.

Australia just reminded everyone that not every country is so forgiving.

A recent Australian appellate decision, The NOCO Company v. Brown and Watson International Pty Ltd [2026] FCAFC 44, reinforces an important point for companies seeking international patent protection: a disclosure strategy that works in the United States may create serious validity problems abroad.

What Is the Best Mode Requirement?

The best mode requirement is simple in concept.

If an inventor knows a preferred way of carrying out the invention, the patent application must disclose it. The idea is that inventors should not receive a patent monopoly while secretly withholding the most effective version of their invention from the public.

Suppose an inventor develops a chemical process that works with ten possible catalysts but knows that Catalyst X consistently produces better results. Under a best mode requirement, merely listing all ten catalysts may not be enough. The inventor may be required to disclose that Catalyst X is the preferred approach.

Historically, the United States imposed this requirement as part of the bargain underlying the patent system: exclusive rights in exchange for full disclosure.

The Curious State of U.S. Law

The United States still has a best mode requirement on the books.

35 U.S.C. §112 requires a patent specification to “set forth the best mode contemplated by the inventor” for carrying out the invention. However, the America Invents Act (AIA) dramatically weakened the requirement in 2011. Failure to disclose best mode can no longer be used to invalidate a patent or render it unenforceable.

As a practical matter, many practitioners view best mode as largely toothless. Even if an applicant omits its preferred embodiment, an accused infringer generally cannot attack the patent on that basis.

That creates a temptation. Why disclose proprietary manufacturing preferences, optimized settings, or preferred materials if there is no meaningful penalty for withholding them?

The answer is that foreign patent offices may take a very different view.

Australia Still Means It

Australia remains one of the few major patent jurisdictions that actively enforces a best method requirement.

Australian patent law requires a complete specification to disclose the best method known to the applicant for performing the invention. Unlike the United States, failure to satisfy this requirement can be raised during opposition proceedings, reexamination proceedings, and patent revocation actions.

As a result, challengers increasingly rely on best method attacks when attempting to invalidate Australian patents.

The NOCO Decision Raises the Stakes

The recent Australian decision involved divisional patent applications.

A divisional application is a later-filed patent application that claims subject matter from an earlier parent application. Divisional applications are common in both the United States and Australia.

The key question was straightforward: When evaluating best method compliance for a divisional application, should courts look at the best method known when the original parent application was filed, or the best method known when the divisional application itself was filed? Australia’s Full Federal Court chose the latter.

The court held that a divisional application must disclose the best method known to the applicant at the filing date of the divisional application itself. If the applicant learned a better way of practicing the invention after filing the parent application but before filing the divisional, that improved method may need to be disclosed in the divisional specification.

That can create a significant challenge for patent owners. Divisional applications are often filed years after the original application. During that time, inventors may continue refining products, manufacturing processes, formulations, software implementations, or operating parameters.

Under the NOCO decision, those later-developed improvements may become relevant to best method compliance.

Why U.S. Applicants Should Care

Many U.S. patent applications are drafted with the assumption that best mode challenges are effectively off the table. That assumption may be harmless if protection is sought only in the United States. It becomes much riskier when the same patent family is filed internationally.

An application that omits preferred manufacturing techniques, preferred materials, optimized process conditions, or other known “best” approaches may survive scrutiny in the United States. The same omission could become a validity issue in Australia.

The risk may be particularly acute for divisional applications filed years after the original application, when the applicant’s understanding of the invention has evolved.

Australia Is Not Alone

Australia is not the only country that continues to require disclosure of the applicant’s best way of performing an invention.

India expressly requires a patent specification to disclose “the best method of performing the invention which is known to the applicant.” Failure to satisfy that requirement can create validity problems and may support revocation of a granted patent.

New Zealand likewise requires a complete specification to disclose “the best method of performing the invention” known to the applicant. The requirement is built directly into the Patents Act 2013 and forms part of the disclosure obligations imposed on patent applicants.

The United States is therefore something of an outlier. While U.S. law still contains a best mode requirement, Congress eliminated best mode as a basis for invalidating or rendering a patent unenforceable. As a result, a disclosure strategy that may present little practical risk in the United States could create significant issues in countries where the requirement remains enforceable.

The Practical Takeaway

For companies pursuing international patent protection, especially in Australia, disclosure decisions made during U.S. patent drafting can have consequences years later.

The safest course is often the simplest one: if the inventors know the best way to practice the invention, disclose it. That approach may seem unnecessary in the United States, where best mode is rarely litigated. But overseas, particularly in Australia, a failure to disclose the best method can still provide a potent weapon for patent challengers. The NOCO decision serves as a reminder that a patent strategy built solely around U.S. law can create unexpected vulnerabilities once the application crosses international borders.

Did the USPTO Fix IDS Abuse?

June 4, 2026

For years, some patent practitioners have treated the Information Disclosure Statement (IDS) like a game of “more is better.” If ten references are good, fifty must be better. If fifty are good, why not submit two hundred?

According to recent data highlighted by Patently-O, that practice may finally be changing.

In January 2025, the USPTO implemented new IDS size surcharges. Applicants now pay additional fees once the cumulative number of cited references exceeds certain thresholds. The result was immediate. The average number of applicant-submitted references dropped by roughly 27%, while the highest-volume filers reduced their submissions by even more.

Economists would say this is exactly what should happen when you raise the price of something. But the more interesting question is whether this change is actually good for patent examination.

The Problem with Massive IDS Filings

Patent applicants have a duty to disclose information material to patentability. Nobody disputes that.

What has always been controversial is the practice of submitting dozens, or even hundreds, of references with little attempt to distinguish which ones actually matter.

From our perspective, that approach often serves two purposes.

First, it can hide the truly relevant references inside a mountain of less relevant material. If an examiner receives a stack of hundreds of citations, the references that deserve close attention can become harder to identify.

Second, large IDS submissions can become a substitute for doing the hard work. Instead of carefully analyzing the invention and identifying the most relevant prior art, the practitioner simply submits everything remotely related to the technology.

Neither approach helps the examiner. Neither approach improves patent quality.

More References Does Not Mean Better Examination

The patent system works best when applicants and examiners focus on the prior art that actually matters.

An IDS containing ten highly relevant references is often far more useful than an IDS containing two hundred references of varying significance. Examiners have limited time. Burying key references inside a massive disclosure package does not make examination more thorough. It often makes it more difficult.

That is one reason we have long questioned the value of oversized IDS filings.

The New Fees Are Changing Behavior

The USPTO’s new surcharge structure applies when the cumulative number of references exceeds 50, 100, and 200 references during prosecution.

Importantly, the data suggests that most applicants are unaffected. The median patent application already contains relatively few cited references. The fee primarily targets the small percentage of applications that generate extraordinarily large IDS submissions.

Those are also the applications responsible for a disproportionate share of all references submitted to the USPTO.

The result appears to be exactly what the USPTO intended: fewer massive IDS filings.

Will Patent Quality Improve?

That remains to be seen.

Critics argue that any financial disincentive could discourage disclosure of relevant prior art. That concern should not be dismissed. Applicants still owe a duty of candor to the Patent Office, and material prior art must still be disclosed.

On the other hand, if the new fees encourage practitioners to spend more time identifying the most relevant references rather than submitting every reference they can find, the quality of examination could actually improve.

For years, many practitioners have complained that oversized IDS filings create more noise than signal. The early data suggest that the USPTO’s new fees may finally be reducing that noise.

Whether that leads to better patents is a question worth watching.

Previous articles related to this: The USPTO’s New Fee Structure for Large Information Disclosure Statement Filings

Updated IDS Fees

Why Patent Challengers Are Abandoning IPR Petitions

May 26, 2026

chart source: https://patentlyo.com/patent/2026/05/inter-partes-review-in-2026.html

Squires Takes Direct Control of PTAB Institution Decisions

John Squires was nominated to be Director of the USPTO in March 2025. Squires was confirmed by the Senate and took office at the end of September 2025. As Director, Squires oversees the Patent Trial and Appeal Board.

In October 2025, he announced that he would personally determine whether the PTAB would institute Inter Partes Reviews (IPRs). This authority had previously been delegated to board judges. That month, Squires personally denied all 34 petitions and did so with the traditional dad justification of “Because I said so”. While a few IPR’s have since been instituted, the basic pattern holds: don’t expect your IPR challenge to get through.

IPR Filings Fall as Practitioners Expect Denial

Given the likelihood of denial, regardless of merit, practitioners have decided there is not much point in filing. As a result, IPR petitions have fallen sharply. As Dennis Crouch put it in his article, Inter Partes Review in 2026, “The IPR system, at least in its original form as a cost-effective alternative to district court litigation for challenging patent validity, is functionally suspended.”

Earlier articles on this subject: What the USPTO’s 0% IPR Institution Rate Means for Patent Holders

The Denials Will Continue Until Morale Improves

The Quiet Retreat of Alice and § 101

May 14, 2026

The Alice character from our Patent Beast Alice v. CLS series retreating into the bushes ala Homer Simpson.

The Collapse of Utility Rejections Under § 101

Dennis Crouch, in his excellent blog, Patently-O, has written an interesting article that examines a handful of unusual patent applications rejected for lack of “utility” under 35 U.S.C. § 101, including claims involving time travel, cold fusion, black-hole energy, melanin-based glucose synthesis, and room-temperature superconductors. It argues that although utility rejections are now rare, they remain important for filtering out scientifically implausible or insufficiently demonstrated inventions and for preventing speculative “paper patents” from distorting innovation incentives and the public record.

How Alice Changed Modern Patent Examination

I think the dramatic drop in §101 rejections is the result of several converging realities.

First, the USPTO has largely internalized the backlash against overaggressive Alice examination. The 2019 PEG guidance under Director Iancu fundamentally changed examiner behavior, and the Office never really went back. Examiners learned—both institutionally and practically—that broad “this is abstract” rejections were getting reversed at the PTAB with increasing frequency.

Why Patent Drafting Strategy Matters More Than Ever

Second, there has been a quiet but important maturation in drafting practice among prosecutors. Patent attorneys adapted. Early post-Alice applications often looked like pre-Alice business method filings with “on a computer” language sprinkled in. Today, most experienced prosecutors know they must:

anchor claims in system architecture,
emphasize data transformation,
identify concrete technical problems,
describe operational constraints,
avoid result-oriented functional language,
and tie the invention to machine behavior or system performance.

That evolution matters enormously.

Abstract Ideas vs. Technological Implementations

In my view, courts and examiners are not actually hostile to software. They are hostile to claims that appear untethered from engineering reality.

When software claims read like:

“receive information,”
“analyze information,”

“determine a result,”
“display output,”

with no meaningful technical implementation details, the claims start looking like disembodied logic or business objectives.

But when claims instead recite:

specific processing architectures,
synchronization mechanisms,
distributed processing,
latency reduction,
memory management,
protocol handling,
resource allocation,
data structure improvements,
or concrete control flows,

they suddenly begin to look much more like traditional engineering inventions. That is why some applications get through and some do not.

Solving Technological Problems in Technological Ways

The real dividing line is often whether the claims appear to solve a technological problem in a technological way.

The irony, of course, is that this distinction is not actually found in the statutory text of 35 U.S.C. § 101. It is a judicially created filtering doctrine that has drifted toward a kind of quasi-obviousness or “smell test” analysis. Even the recent criticism from groups like American Intellectual Property Law Association reflects growing discomfort that Alice step two effectively resurrected the old pre-1952 “inventive concept” requirement.

ColdFusion, Software Patents, and Concrete System Claims

The article’s ColdFusion observation is especially interesting because many ColdFusion-based inventions involve workflow orchestration, server-side processing, database interaction, and dynamic application behavior. Those technologies can absolutely survive §101 when claimed as concrete computing systems rather than abstract automation concepts.

I suspect many successful applications in that space succeed because:

the claims stay grounded in system mechanics,
the specification explains technical implementation details,
and the drafting avoids claiming the business result itself.

In other words, they claim how the system achieves the result, not merely the desired outcome.

The Quiet Retreat of Aggressive § 101 Enforcement

I also think examiners increasingly recognize an uncomfortable practical reality: modern computing innovation is largely software innovation. If §101 were applied in its harshest theoretical form, enormous portions of contemporary technology would become effectively unpatentable. The system has quietly adjusted to avoid that outcome.

So although Alice formally remains intact, operationally we may be watching §101 slowly retreat back toward a narrower gatekeeping function rather than the broad invalidation weapon it became from roughly 2014–2021.

For related articles concerning sec 101 issues: The Harsh Reality of Sec 101 Appeals

Patent Drafting Considerations for Inventions Positioned Between Dietary Supplements and Drugs

May 11, 2026

Patent Strategies for Nutraceutical and Wellness Innovations

Innovators in the health and wellness space are increasingly developing products that sit somewhere between a dietary supplement and a pharmaceutical drug. A formulation may support healthy aging, metabolism, cognition, or recovery, while also showing measurable physiological or therapeutic effects. From a patent perspective, that creates both opportunity and complexity.

Preserving Regulatory and Commercial Flexibility in Patent Applications

One of the most important considerations when drafting a patent application in this area is preserving flexibility. The same invention may ultimately be marketed as a consumer wellness product, licensed as a medical technology, or developed through a pharmaceutical pathway. A patent application should ideally support all of those possibilities rather than locking the invention into a single regulatory category too early.

FDA Classification and Patent Drafting Language Considerations

Language matters. In the United States, FDA classification often depends heavily on intended use. Statements about “treating disease” can push a product toward drug characterization, while language focused on supporting normal structure or function may align more closely with dietary supplement positioning. For that reason, well-drafted applications often include both wellness-oriented and therapeutic embodiments so that future business and regulatory options remain open.

Claim Drafting Strategies for Supplement and Pharmaceutical Technologies

Claim strategy is equally important. Strong applications in this space frequently include multiple layers of protection, such as claims directed to:

compositions and ingredient combinations,
formulations and delivery systems,
methods of use,
manufacturing processes, and
purified or standardized active components.

This broader approach can create more durable and commercially valuable patent coverage.

Patentability Challenges for Natural Products and Nutraceutical Formulations

Natural products and nutraceutical technologies also present unique patentability issues. Botanical extracts, peptides, probiotics, metabolites, and naturally occurring compounds often face heightened scrutiny under patent eligibility and obviousness standards. As a result, it is important to highlight what is truly inventive about the technology, whether that involves purification methods, synergistic combinations, improved bioavailability, novel dosing strategies, or unexpected functional results.

Strengthening Patent Applications with Technical Support and Enablement

Another key consideration is supporting the claims with sufficient technical detail. Recent patent law developments have increased the importance of enablement and written description support, particularly for broad functional claims. Including multiple examples, formulations, dosage ranges, and experimental data can significantly strengthen a patent application and provide valuable support for future continuation filings.

Aligning Patent Strategy with Long-Term Commercial Goals

Perhaps most importantly, patent strategy should be aligned with the client’s broader commercial goals. Early-stage companies often evolve rapidly, and products initially positioned as

supplements may later move into clinical development or strategic licensing opportunities. A thoughtfully drafted patent application can help preserve those future options.

The Growing Importance of Patent Protection for Wellness and Therapeutic Products

As the lines between supplements, wellness products, functional foods, and therapeutics continue to blur, careful patent drafting has become more important than ever. The best applications not only protect the invention itself, but also preserve the flexibility needed to adapt as science, regulation, and markets evolve.

FRAND, Standard-Essential Patents, and Samsung v. ZTE

May 4, 2026

What Are Standard-Essential Patents (SEPs)? A Quick Primer for Businesses

If your products rely on modern connectivity, whether that’s cellular, Wi-Fi, or video streaming, you are almost certainly using technology governed by industry standards. A standard-essential patent (SEP) covers technology that is required to comply with one of those standards. In practical terms, that means there is no viable way to build a standards-compliant product without using the patented invention.

SEPs are common in industries like telecommunications, consumer electronics, automotive systems, and even IoT devices. For many companies SEPs may not be front-of-mind, but they are often embedded deep within the technologies you depend on.

What Does FRAND Mean? Understanding “Fair, Reasonable, and Non-Discriminatory” Licensing

Because SEPs are powerful, their owners typically agree to license them on FRAND terms—short for fair, reasonable, and non-discriminatory. This commitment is meant to prevent patent holders from exploiting their position once a standard has been widely adopted.

In theory, FRAND ensures balance in two ways. The first is that patent owners are paid for their innovations. The second ensures that product companies can access the technology without being priced out of the market

In reality, however, FRAND is not a fixed formula. What is “fair” or “reasonable” often depends on context, negotiation dynamics, and frequently, court intervention.

Why Samsung v. ZTE Matters Even If You’re Not Samsung or ZTE

A recent UK court decision involving Samsung and ZTE highlights just how fluid FRAND determinations can be. While the case itself involved a high-value dispute between global players, the broader lessons apply much more widely.

The court was asked to determine a global licensing rate after the parties couldn’t agree. Rather than simply relying on past agreements as benchmarks, the court took a deeper look, questioning whether those agreements reflected true market value or were influenced by external pressures like litigation risk or even geopolitical factors.

That approach signals an important shift: courts are increasingly willing to look behind the numbers rather than treating prior deals as automatically authoritative.

Key Takeaway #1: FRAND Rates Are Flexible—Not Formulaic

For businesses negotiating SEP licenses, one of the most important lessons is that there is no single “right” rate. Courts are showing a willingness to adjust for unequal bargaining power. They are also willing to discount agreements made under pressure and reevaluate what counts as a meaningful “comparable” license.

For smaller companies, this can be a double-edged sword. On one hand, it creates room to challenge unfavorable terms. On the other, it means negotiations can be less predictable and require stronger strategic positioning.

Key Takeaway #2: SEP Licensing Is Increasingly Global

One of the most striking aspects of the Samsung/ZTE dispute is that similar proceedings are happening all over. And courts are asserting authority to set worldwide licensing terms.

Even if your company operates primarily in the U.S., SEP issues rarely stay confined to a single jurisdiction. Supply chains, customer bases, and licensing demands often cross borders. That means a dispute in one country can have ripple effects elsewhere. Licensing strategies need to account for international exposure. Different courts may reach different conclusions on similar facts. For smaller businesses, this underscores the importance of thinking globally, even when your operations feel local.

Key Takeaway #3: Negotiation Leverage Matters More Than Ever

Another theme emerging from the decision is that not all license agreements reflect pure patent value. Courts are increasingly sensitive to the idea that some deals are driven by fear of injunctions. Others are influenced by regulatory or market pressures and larger players may have structural advantages in negotiations.

For smaller companies, understanding your leverage, whether technical, commercial, or legal, is critical. A well-prepared licensing strategy can make a significant difference in both cost and risk.

What This Means for Clients of Smaller IP Law Firms

You don’t need to be a multinational corporation to feel the effects of SEP licensing trends. If your business:

Develops technology that could be incorporated into standards
Manufactures or sells connected devices
Integrates third-party components that rely on standardized technologies

…then SEPs and FRAND obligations are already part of your risk landscape.

The good news is that the evolving legal framework creates opportunities as well as challenges. Courts are showing a willingness to scrutinize licensing practices more closely. This can benefit companies prepared to engage thoughtfully and strategically.

The Bottom Line: SEP and FRAND Strategy Is No Longer Optional

The Samsung v. ZTE decision is less about the specific dollar figure and more about the direction of travel. SEP licensing is becoming more complex, more global, and more dependent on nuanced legal and business analysis.

For smaller and mid-sized companies, that means one thing: proactive IP strategy matters. Understanding how FRAND works, where your risks lie, and how to approach licensing negotiations can help you avoid costly disputes—and potentially secure more favorable outcomes.

In an increasingly connected world, SEPs are everywhere. The companies that navigate them well will have a clear advantage.

For other articles on FRAND and SEP: FRAND (Fair Reasonable and Non-Discriminatory licensing)

Standards Essential Patents

Are AI Legal Research Tools Really “Hallucination-Free”?

April 27, 2026

There’s been no shortage of bold claims about AI in the legal world. Major platforms now promise faster research, better answers, and—perhaps most ambitiously—tools that are effectively “hallucination-free.” A recent Stanford study gives a more nuanced picture. What follows isn’t original research, but a guided walkthrough of that paper—what it set out to test, what it found, and why its conclusions matter.

What the Stanford Researchers Actually Tested

The study, “Hallucination-Free? Assessing the Reliability of Leading AI Legal Research Tools,” is one of the first rigorous, preregistered evaluations of commercial legal AI systems.

Rather than relying on anecdotes or isolated failures, the researchers constructed a dataset of more than 200 legal queries designed to mimic real-world usage. These included straightforward doctrinal questions, complex or evolving legal issues, factual lookups, and questions built on false assumptions.

The goal was simple but important: not just whether the tools could produce answers, but whether those answers were both correct and properly grounded in legal authority.

The Promise of RAG—and Why It Falls Short

Much of the marketing around legal AI focuses on retrieval-augmented generation (RAG). In theory, RAG systems reduce hallucinations by pulling relevant legal documents first and then generating answers based on those sources. The Stanford paper tests that claim seriously.

What it finds is that legal reasoning doesn’t map neatly onto document retrieval. Law isn’t just a collection of static facts; it’s an evolving system of interpretations, precedents, and jurisdictional nuances. Even identifying the “right” sources can require legal judgment.

As the researchers note, errors can creep in at multiple points: the system may retrieve the wrong documents, misinterpret the right ones, or apply them incorrectly.

How “Hallucination-Free” Are These Tools?

This is where the study directly challenges industry claims.

While the tested tools performed better than general-purpose models like GPT-4, they still produced hallucinations—false or misleading outputs—at meaningful rates. In some cases, these systems hallucinated more than 17% of the time, depending on how errors were measured.

That’s not a marginal issue. In legal practice, even a small error rate can have serious consequences.

The study also found significant differences between systems. Some tools prioritized answering questions (and made more mistakes), while others were more conservative, declining to answer a large share of queries but producing fewer incorrect responses.

The More Subtle Problem: Misleading but Plausible Answers

One of the most valuable contributions of the paper is how it reframes “hallucinations.”

Not all errors are obvious fabrications. In fact, some of the most concerning failures involve answers that look credible—because they cite real cases—but are actually misgrounded. That is, the cited authority doesn’t support the proposition being claimed.

This kind of mistake is especially dangerous. A fabricated case can be spotted; a misapplied real case often cannot, at least not without careful review.

When AI Accepts False Premises

Another striking finding comes from how these systems handle incorrect assumptions.

When asked questions built on false premises—like misstatements of case outcomes or legal doctrine—AI tools often accept the premise and generate answers around it, rather than correcting the user.

This mirrors earlier research on general-purpose models and highlights a persistent issue: these systems tend to be cooperative rather than adversarial, even when accuracy demands pushback.

What the Study Means for Lawyers

The takeaway from the Stanford study is not that legal AI is useless—far from it. These tools clearly offer efficiency gains and can outperform general-purpose models in many contexts.

But they are not, despite marketing claims, hallucination-free.

The authors emphasize that lawyers remain responsible for verifying outputs, checking citations, and exercising independent judgment. In fact, the need for verification may offset some of the promised efficiency gains, since each claim and citation may require confirmation.

The Bottom Line: Don’t Rely on the Marketing

If there’s one takeaway worth emphasizing, it’s this: the gap between marketing claims and empirical evidence is real.

The Stanford paper doesn’t argue against using AI in legal research. Instead, it situates these tools where they belong—as useful starting points, not authoritative endpoints.

If you’re working in or around the legal field, it’s worth reading the original study in full. Not because it settles the debate, but because it grounds that debate in actual data rather than assumptions.

And in a domain like law, that distinction matters.