Inter Partes Reexam: Under Utilized Patent Litigation Defense

Earlier today Scott Daniels of Westerman Hattori Daniels & Adrian wrote on his Reexamination Alert™ blog about his review of 100 requests for inter partes reexamination filed between December 2010 and the end of March 2011.  See The PTO’s Recent Treatment of Reexamination Requests.  Daniels’ review of these cases demonstrates that there was a slight drop in the percentage of reexaminations order compared with historical numbers.  Out of this sampling 90% of the requests were granted, compared to a historical grant rate of 95%.

A 5% drop in the percentage of inter partes reexamination requests isn’t in and of itself interesting. What is extremely interesting, however, is what Daniels concluded was the cause of the denials.

According to Daniels, any request for reexamination should focus on the patent examiner’s reasons for allowance.  If you can come up with prior art that calls into question the examiner’s rationale that should considerably assist your request for reexamination.  Daniels writes:

[The] PTO’s determination of whether an [significant new question of patentability] is raised depends heavily on the original prosecution history, especially the examiner’s stated reason for allowance.  Thus, the PTO’s denial of reexamination is usually based on the requester’s failure to present prior art disclosing the claimed feature that had been lacking in the references cited during the original prosecution.

But what is reexamination, specifically an inter partes reexamination?

Any third-party requester, at any time during the period of enforceability of a patent issued from an original application filed on or after November 29, 1999, may file a request for an inter partes reexamination at the United States Patent and Trademark Office challenging any claim of the patent based on prior patents or printed publications.  The trigger date, November 29, 1999, is owed to the fact that inter partes reexaminations were first authorized upon enactment of the American Inventor’s Protection Act (AIPA), which was signed into law by President Clinton on November 29, 1999.

Prior to the AIPA any request for reexamination would need to be an ex parte request, which would allow any individual or party to request reexamination based on prior patents or printed publications.  The fundamental difference between ex parte and inter partes reexamination is the fact that in an ex parte proceeding the requester cannot participate past the request for reexamination, with only one exception.  In an ex parte reexamination the patent owner may make what is called a “patent owner’s statement.”  See MPEP 2249.  If the patent owner is going to make such a statement it must be filed within two months of the order initiating the reexamination and cannot be extended for any reason.  If a patent owner statement is made the requesting party may reply, but from that point forward would not participate.

In an inter partes reexamination proceeding the requesting party participates throughout the process and may even appeal adverse determinations, first to the Board of Patent Appeals and Interferences (BPAI) and ultimately to the United States Court of Appeals for the Federal Circuit.

The “period of enforceability” requirement mentioned about relates to the time within which a request for reexamination can be made.  The period of enforceability of the patent requirement, was set by rule since there is no useful purpose for expending USPTO resources on deciding patent validity questions in patents which cannot be enforced. The period of enforceability is determined by adding 6 years to the date on which the patent expires because the statute of limitations in a patent infringement action is 6 years, which means a patent infringement action could be brought up until 6 years after a patent expires.  Of course, generally speaking damages can only be awarded for the period of time that overlaps between the statute of limitations and the time the patent was not yet expired.

According to Daniels, who I reached via e-mail for comment:

In almost all cases, inter partes reexamination is better than ex parte reexamination, except of course where the requester wants to stay anonymous or the application from which the patent issued was filed before November 1999.  The opportunity to reply to the patentee’s arguments and to address the specific concerns of the examiner is quite valuable.  This is especially true where the examiner cites his or her own prior art.  Issues commonly evolve over the course of reexamination, so that arguments in an ex parte request often are no longer persuasive by the end of the proceeding. I would add that some of the frequent users of reexamination, such as Apple and Google, almost always select inter partes reexamination when it is an option.

Nevertheless, Daniels says that even given the advantages of inter partes reexamination “only half of the requests that are eligible for inter partes treatment, are actually filed as inter partes requests.”

Reexamination is becoming a larger part of the patent world as an effective and economical means to challenge patents that are being enforced or which may soon be enforced.  In the situation where reexamination is pursued as part of an overall litigation strategy, “inter partes reexamination can be more effective than ex parte reexamination,” Daniels says.  One particular benefit in the concurrent or parallel reexamination scenario is the admissions that can be forced by the third-party requester who is the defendant in ongoing litigation.  In inter partes reexamination “inducing comments from the patentee that might be useful in a parallel infringement litigation, for instance on non-validity issues such as willfulness or materiality, for example.”

Through the first 6 months of fiscal year 2011, which ended on March 31, 2011, only 392 requests for ex parte reexamination were filed at the United States Patent and Trademark Office, and a mere 180 requests for inter partes reexamination were filed.  See Reexaminations FY 2011.  During that time period there were at least 3 times the number of patent infringement litigations commenced.  As you can see from the chart below, which covers FY 1980 through FY 2010, patent litigation is only on the rise.

For the life of me I don’t understand why reexamination, particularly inter partes reexamination is not more popular.  Defending a patent infringement lawsuit is extremely expensive and there is always a lot on the line.  So why does such a useful tool for challenging the validity of an asserted patent continue to be tremendously under utilized?

For those who are serious in defending a patent infringement litigation you really must consider a reexamination strategy.


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Join the Discussion

9 comments so far.

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    July 7, 2011 11:18 pm

    Only 80 weeks total all the way from the reexam request to Board appeal briefs? That is not a particularly slow inter partes reexam. I have seen much older pendencies reported. Isn’t 80 weeks less than a typical D.C. time period between filing a patent suit complaint and getting a trial date?
    Of course any party that does not want a fast decision can maximize their allowed response periods. But both the reexam requester and patent owner have strict response time deadlines only extendable by petition, while a reexam examiner does not.
    I am especially curious if the BPAI is really taking up and deciding reexam appeals ahead of all ex parte appeals, as it should, since the statutory “special dispatch” requirement expressly applies to the Board as well. The total reported numbers of final Board decisions in reexaminations seem surprisingly small.

  • [Avatar for Mark Nowotarski]
    Mark Nowotarski
    July 7, 2011 07:53 pm

    “Studies show 5 years or more for the PTO to decide..”


    I think that’s a little misleading. There’s a lot of waiting on the part of all parties: the examiner, the requester and the owner. I took a look at an extensive sample of 1 (serial number 95/000500) and the USPTO consumed 44 weeks to issue a nonfinal and final rejection and the requester + owner consumed 36 weeks for their respective responses to the non final and final rejection (i.e. appeal briefs). That case is now before the BPAI.

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    July 7, 2011 04:20 pm

    “Just visiting” is correct that the PTO has been taking too long. Studies show 5 years or more for the PTO to decide many CONTESTED inter partes interferences [especially where the patent owner files petitions for more time and/or for filing more papers]. In spite of the statutory requirement of “special dispatch” handling by the PTO! But the PTO says it is now seriously addressing this, and has requested public suggestions for speeding up. Other reports say that ltigation is not necessarily faster in some courts. SJ’s are rarely granted for 103 invalidity based on prior art patents and publications, thus requiring a full jury trial to win, with clearly much worse odds and great expense. Other than what have been fast trial courts like E.D. TX and N.D. VA. It depends on the particular District Court judge and whether or not they may grant a “stay” of the litigation for the reexamination, assuming the reexam was promptly filed after the suit or threat.
    Good reasons for conducting reexaminations in parallel with litigation have also been argued. even if the reexam does not get to the Board before trial.

    This decision-making seems very likely to become even more important, as both the Senate and House patent reform bills passed with provisions that will create 5 different reexaminations.

  • [Avatar for Just visiting]
    Just visiting
    July 7, 2011 02:33 pm

    From my limited experience with inter-partes reexams (which is better than most, who have never touched one), it is quicker to go the litigation route.

    It may be cheaper, but the USPTO can easily eat up years and years and years.

    Expedited prosecution is a concept that is foreign to most examiners.

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    July 7, 2011 01:15 pm

    I should add that the above-noted estoppel risks have to be balanced against the fact that the above estoppels only apply to prior art patents and publications, not to any other invalidity defenses, and the fact that the odds of invalidating asserted claims in an inter partes reexamination are vastly better than getting a lay jury to invalidate them on that basis

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    July 7, 2011 01:01 pm

    Although the points above are well taken, there is one significant disadvantage to inter partes reexaminations that ex parte reexamination does not have. 35 USC 315(c) imposes issue estoppels on the inter partes reexamination requester . In general, a requester who is granted an inter partes reexamination by the PTO may not assert at a later time in any civil action in a U.S. district court the invalidity of any claim finally determined to be valid and patentable on any ground which the third party requester raised or could have raised during the inter partes reexamination proceedings. However, the third party requester may assert invalidity based on newly discovered prior art unavailable to the third party requester and the PTO at the time of the inter partes reexamination proceedings.
    Both of the terms “could have raised” and “unavailable” from the inter partes reexamination statute are dangerously undefined and judicially un-tested. “Could have raised” is especially uncertain when litigation discovery may be possible. .
    Also, even though the inter partes reexamination statute does state, and was intended to mean, application only to “original” applications filed after the 1999 statute, a Fed. Cir. panel was somehow convinced to hold that it also applies to continuations filed after that date even though originally filed before that date.

  • [Avatar for Notalitigator]
    July 7, 2011 12:45 pm

    I’m not a litigator, so feel free to comment/correct.

    My understanding as to why reexamine is not utilized is as follows:

    why trust the PTO to determine whether the patent, they already issued, should have been issued, and raise estoppel with respect to the best prior art you could have otherwise used in litigation?

  • [Avatar for PS DIP]
    PS DIP
    July 7, 2011 07:25 am

    Re: Usage rate – A cynical question: Does an inter partes reexamination keep a team of litigation associates with little to no patent experience cranking out 250 hour months for an entire year during the heat of battle?

    Re: Mr. Daniels quote – ‘where the examiner cites his or her own prior art.’ – Most everyone I know in CRU (anecdotal evidence) says they never search for or cite their own prior art. That is one of the things they like about CRU, the re-exam filer is bringing the best stuff to the table and setting up the potential rejections for them. All they have to do is referee the fight.

  • [Avatar for Mark Nowotarski]
    Mark Nowotarski
    July 6, 2011 05:04 pm

    I was sold on the virtues of an inter partes reexamination when a patent on my own inventions was subject to a European opposition proceeding. Crossing swords with a determined competitor over the validity of your patent can be rather exhilarating. They came up with some truly hard-to-find prior art from Japan which we ultimately defended ourselves against before a panel of examiners. The proceedings were carried out in two languages with simultaneous real time translation. The best part was getting our final decision right away. We waited out in the hall and the head examiner let us know within 10 minutes.

    And so I agree with Gene. It’s too bad we don’t have more inter partes proceedings in the US.