I discussed the two-prong test for the on-sale bar in my Feb. 17, 2022 blog post. The two-prong test for the on-sale bar indicates that a patent claim will be invalid when the claimed invention was both (1) the subject of a commercial offer for sale, and (2) ready for patenting. Pfaff v. Wells Elecs., Inc., 525 U.S. 55, 67–68 (1998). The issue of the applicability of the on-sale bar is “a question of law based on underlying factual findings.” Meds. Co. v. Hospira, Inc., 827 F.3d 1363, 1371 (Fed. Cir. 2016) (en banc).

One way to avoid satisfying the first prong is to assert that the offer to sell was merely an offer to use the patented invention experimentally (i.e., the experimental-use exception). The Court of Appeal for the Federal Circuit considered the experimental-use exception in Sunoco Partners Marketing & Terminals L.P. v. U.S. Venture, Inc., Case No. 20-1640 (Fed. Cir. April 29, 2022).

The invention-at-issue related to butane blending. The patent owner entered into a contract to offer to sell an automated butane-blending system to a third-party company more than one year before filing applications for two of the patents-at-issue.

The lower court held that the sale represented experimental use, but the Federal Circuit court examined the transaction more closely before finding that the sale was a “for profit” sale. As a result, the sale invalidated certain claims of the patents.

The patent owner relied upon provisions of the sale that required pre-installation testing and post-installation testing of the system. However, the Federal Circuit noted that the testing was not for commercial purposes. Rather, the court determined that the testing was being done to ensure that the system would operate properly upon installation.

The ultimate result of the case indicates that an inventor should be very careful if he or she intends to rely upon the experimental-use exception before filing a patent application. The Sunoco decision indicates that any pre-filing transaction is going to be scrutinized closely by a court, which will make it very difficult to rely upon this exception.