Beware the NOT so Technical AIA Technical Amendments!

By Gene Quinn on February 20, 2012

On Wednesday of last week I was in Washington, DC, and then on Thursday and Friday I traveled to New York City for the 6th Annual PLI Patent Institute.  Over these days out and about I heard similar stories from well placed individuals in the industry.  Had I heard it only once from one source I would have believed it to be true, given who was telling me, but I heard substantially the same thing from several very credible sources.  The troubling news starts with the fact that a technical amendments bill to the America Invents Act (AIA) that is working its way around Capitol Hill, and in true government by ambush fashion it could work its way into a bill at any time!   Everyone interested in stopping substantive changes to the AIA needs to be prepared to act fast!  In fact, I understand that if the Stop Online Piracy Act (SOPA) had moved forward the AIA Technical Amendments bill would have been attached to it.

What is the big deal about technical amendments?  The problem is that not all of the amendments will be “technical.”  For example, there is a plot afoot to change the estoppel provisions in the AIA relative to post-grant review and inter partes review.  As enacted, estoppel attaches relative to any ground raised or which reasonably could have been raised during the proceeding.  There is an intense effort to have the technical amendments modify the estoppel provisions to provide estoppel only for that which was “actually raised,” thereby excising the “reasonably could have raised” language.  This is obviously a substantive amendment, and a truly terrible idea.

For example 35 U.S.C. § 325(e) discusses how estoppel will be applied relative to a final written determination in a post-grant review proceeding.  The newly enacted law says:

(1) PROCEEDINGS BEFORE THE OFFICE.— The petitioner in a post-grant review of a claim in a patent under this chapter that results in a final written decision under section 328(a), or the real party in interest or privy of the petitioner, may not request or maintain a proceeding before the Office with respect to that claim on any ground that the petitioner raised or reasonably could have raised during that post-grant review.

(2) CIVIL ACTIONS AND OTHER PROCEEDINGS.— The petitioner in a post-grant review of a claim in a patent under this chapter that results in a final written decision under section 328(a), or the real party in interest or privy of the petitioner, may not assert either in a civil action arising in whole or in part under section 1338 of title 28 or in a proceeding before the International Trade Commission under section 337 of the Tariff Act of 1930 that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that post-grant review.

(emphasis added).

Similarly, 35 U.S.C. § 315(e) discusses how estoppel will be applied relative to a final determination in an inter partes review.  The newly enacted law says:

(1) PROCEEDINGS BEFORE THE OFFICE.— The petitioner in an inter partes review of a claim in a patent under this chapter that results in a final written decision under section 318(a), or the real party in interest or privy of the petitioner, may not request or maintain a proceeding before the Office with respect to that claim on any ground that the petitioner raised or reasonably could have raised during that inter partes review.

‘‘(2) CIVIL ACTIONS AND OTHER PROCEEDINGS.— The petitioner in an inter partes review of a claim in a patent under this chapter that results in a final written decision under section 318(a), or the real party in interest or privy of the petitioner, may not assert either in a civil action arising in whole or in part under section 1338 of title 28 or in a proceeding before the International Trade Commission under section 337 of the Tariff Act of 1930 that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that inter partes review.

(emphasis added).

Those who watched the making of the America Invents Act are well aware that the inter partes review and post-grant review caused much concern within the industry.  Post-grant review was a particularly contentious issue because many feared that after a lengthy patent prosecution the issuance of a patent could be held up further, perhaps indefinitely, by post-grant review proceedings.  The way that fears were calmed was, at least in significant part, by having the estoppel provisions apply to not only issues raised, but which could have been raised.  In this sense the utilization of either post-grant review or inter partes review became something of a “speak now or forever hold your peace.”  That would all change if this technical amendment were enacted.

Congress well knew what they were doing when they included “reasonably could have raised,” and to say that something substantive is appropriate for a technical amendment bill, which should address non-substantive nuances, is nearly breathtaking.  What is worse, the one thing that begs for technical amendment is the issue of best mode, which will not be addressed.

So what has Congress said about the estoppel provisions?  On June 29, 2011, the House Judiciary Committee issued a Report on H.R. 1249 to the full House of Representatives, which says in part:

In utilizing the post-grant review process, petitioners, real parties in interest, and their privies are precluded from improperly mounting multiple challenges to a patent or initiating challenges after filing a civil action challenging the validity a claim in the patent. Further, a final decision in a post-grant review process will prevent the petitioner, a real party in interest, or its privy from challenging any patent claim on a ground that was raised in the post-grant review process.

(see page 77).  The only way you prevent the mounting of multiple challenges by real parties and their privies is to have estoppel apply to both issues raised and issues that could have been raised.  The addition of the language “reasonably could have been raised” was a direct attempt to circumvent serial challenges.

Moreover, in debate on the AIA in the United States Senate on September 8, 2011, Senator Jon Kyl (R-AZ) explained that because of the “enhanced estoppel” provisions in the bill it was imperative to extend the deadline within which to initiate an inter partes review to 1 year after the date on which the petitioner is served with a complaint alleging infringement of a patent.  Senator Kyl said:

Current law imposes no deadline on seeking inter partes reexamination. And in light of the present bill’s enhanced estoppels, it is important that the section 315(b) deadline afford defendants a reasonable opportunity to identify and understand the patent claims that are relevant to the litigation. It is thus appropriate to extend the section 315(b) deadline to one year.

(see page S5429, bottom column 2 to top column 3).

The above pieces of legislative history are only illustrative of the wranglings both behind the scenes and out in the open relative to the estoppel provisions contained in the AIA.  These estoppel provisions were central to the debate and a back-door attempt to unravel the delicate bargain reached smacks of cowardice and the back-room deals that make rational Americans wonder whether government works for the people.  Seriously, unraveling something like this in a technical amendment would be the height of arrogance and might as well be Congress “flipping off” all those in the industry who legitimately and carefully participated in the legislative process.  Why bother if behind the scenes after the dust has settled powerful lobbyists can change key terms with a so-called technical amendment?

In my opinion there would have been absolutely no chance that the America Invents Act would have passed if the estoppel provisions for post-grant review only applied to issues actually raised.  Those who opposed the America Invents Act need to remain vigilant, as well as those who held your nose and swallowed hard.  It is imperative that those with an agenda are not allowed to subvert the patent system and legislative process to accomplish things that never could have been accomplished in the light of day.

The technical amendments to the AIA will not simply make minor adjustments.  Stay alert and beware!

The Author

Gene Quinn

Gene Quinn is a patent attorney and the founder of IPWatchdog.com. He is also a principal lecturer in the PLI Patent Bar Review Course and an attorney with Widerman & Malek.

Gene’s particular specialty as a patent attorney is in the area of strategic patent consulting, patent application drafting and patent prosecution. He has worked with independent inventors and start-up businesses in a variety of different technology fields, but specializes in software, systems and electronics.

is admitted to practice law in New Hampshire, is a Registered Patent Attorney licensed to practice before the United States Patent Office and is also admitted to practice before the United States Court of Appeals for the Federal Circuit.

Gene is a graduate of Franklin Pierce Law Center and holds both a J.D. and an LL.M. Prior to law school he graduated from Rutgers University with a B.S. in Electrical Engineering.

You can contact Gene via e-mail.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 7 Comments comments.

  1. Randall Landreneau February 21, 2012 9:59 am

    Gene – The fact that the original version of The America Invents Act brought to the Senate (before the House and the Senate again) did not even address Fee Diversion (which was only added by amendment later) should be a clear sign that the powers behind the bill have different goals than you and me. The America Invents Act and proposed Technical Amendments are the logical result of multinational corporate attorneys acting on the concept expressed by Bill Gates in his interview with Ken Auletta in 1998: “I worry about someone in a garage inventing something I haven’t thought of.” The independent inventor has always been a threat to the vested corporate interest. The purpose of the AIA was and is to lessen the threat. The America Invents Act is an effort to kill the American Dream, and as such, must be overturned. – Randall Landreneau

  2. Steve M February 21, 2012 10:24 am

    Welcome yet again to another sad example of:

    Government by the politicians and special interests.

    For the politicians and the special interests.

    The people be damned.

  3. Anon February 21, 2012 12:57 pm

    Technical amendments would be better served to patch the glaring holes in the Prior User Rights section.

    There is a serious possibility of a constitutional infirmity in the Takings arena. I have posted the hypothetical before, but a summray of it is as follows:

    Under the current Prior User Rights section, a Patent Holder has no action against someone with a Prior User Right (only discovered after the patent right has been obtained, and in enforcement of that valid patent). Actual money and time have been spent. Expectation interests have been earned.

    Further, any customer of the non-patent holding Prior User right exhausts the patent holders rights. The Patent holder obtains nothing from a sale of his patented technology. There is no chance in even a secondary market. In a tight market condition with limited vendors and a valuable patent, a small firm holding a patent can be systematically undercut by a large multinational who has chosen the secrecy and freerider path and holds a Prior User Right, and because of their relative size, can price the patented technology at a point that the true patent holder cannot touch.

    The true patent holder, the one who was willing to share his information to promote the progress and obtain patent rights of exclusion, is left with a worthless patent. He cannot go after the large multinational. He cannot go after the buyers.

  4. Stan E. Delo February 21, 2012 2:04 pm

    Gene-

    Thank you very much for letting us know about this insidious turn of events. The term graft immediately sprang to mind for me. (Graft: 3~ The getting of money or advantage dishonestly) Fortunately I have at least one Senator (Cantwell) that will be vehemently opposed to this kind of nonsense, as she got up on the Senate floor and vigorously opposed the passage of the AIA very eloquently, I thought. Any idea where it might show up first?

    Anon-

    The PPAC hearings on PUR’s is now available for download, and it will be interesting to hear what they had to say in the matter. http://judiciary.house.gov/hearings/Hearings%202012/hear_02012012.html
    Fast forward to the start at 32 minutes.

    Stan~

  5. Stan E. Delo February 21, 2012 2:40 pm

    Oops! The PUR hearing was testimony, and not a PPAC hearing. BTW- The PTO is presenting a free webinar this afternoon about the new fee schedule proposal and a few other things with PTO senior management attending at 4:30 ET.

    https://uspto-events.webex.com/mw0306ld/mywebex/default.do?nomenu=true&siteurl=uspto-events&service=6&rnd=0.8909368105010425&main_url=https%3A%2F%2Fuspto-events.webex.com%2Fec0605ld%2Feventcenter%2Fevent%2FeventAction.do%3FtheAction%3Ddetail%26confViewID%3D416113830%26siteurl%3Duspto-events%26%26%26

    The password is 123456, and a tip of the hat to Donald Zuhn at Patent Docs for reminding us of it.

    Stan~

  6. Gene Quinn February 21, 2012 5:40 pm

    Stan-

    No idea where the Technical Amendment for the AIA will show up. It seems as if it could be attached to something else that either has to pass or is likely to pass. Definitely government by ambush, which is why I hope everyone spreads the word!

    -Gene

  7. Stan E. Delo February 21, 2012 6:47 pm

    Gene-

    Why am I not surprised? I will start calling and E-mailing my Senator Maria Cantwell’s office to see if I/we can get at least some warning before somebody in the Senate or the House of Representatives tries to jam something through when they figure nobody might be paying attention. Sorta like *Magic*, wherein the magician gets away with fooling most of the people by using misdirection. Interestingly enough, the USPTO session was marred very badly by the Cisco-powered WebEx format, with astoundingly bad video and audio quality,

    The Cisco chief counsel at the time of prior Patent Reform efforts was especially remorseless and relentless in trying to Jam through the Patent Reform acts of both 2007 and 2009, and it was very obvious to me at least that he didn’t really give a hoot at all about what was best for the US going forward. All he cared about was Money, and their precious market share of it.

    Dangerous times, so stay diligent!

    Stan~