I don't know law, but from what I've understood from others, this isn't the case. That's why people talk about prior art. If it's been in use already, you shouldn't be able to patent it.
They are apparently changing patent law to make it the first to file, rather than the first to invent/use, which to me seems rather odd. Surely the point was if you had a great idea on a new way of doing something, a patent should protect you. This new way, it wont if you don't fill out the paperwork?!!?
It makes total sense if true. It's totally un-workable at the moment. How does a patent office know if there's been prior use? And how does a company prove no prior use. It's a very silly system, which means it has to go to costly law courts, which small companies can't afford.
First to file, would solve this problem massively and massively help small companies.