What is Michelle Lee Hiding?

By Erich Spangenberg
February 29, 2016

“I don’t want to be embarrassed” is not a grounds for privilege and improperly asserting privilege is not being transparent.

 

michelle-lee-04-2015-pto

USPTO Director Michelle Lee

Michelle Lee is the head of the US patent office. She makes regular pronouncements and speeches on how important transparency is to her and the US patent system. Not long after taking over as Director in 2014, Michelle gave a speech on The Benefits of Transparency Across the Intellectual Property System at a major IP conference. She talked about her embrace and dedication to transparency for the US patent office – “As we all work together to build a better IP system, the light of transparency can guide us.” If you google “Michelle Lee transparency” you can find more quotes with similarly lofty and inspiring language. However, Ms. Lee doesn’t seem to practice what she preaches: read this story, and you be the judge as to whether Ms. Lee and the patent office truly support transparency.

In case you missed the story in the NYTimes, Kyle Bass and I have launched an initiative to invalidate incredibly specious pharmaceutical patents using the wonderful tools given to all under the America Invents Act. To be clear—just like the pharma companies we are up against, we are not an eleemosynary institution and have a profit motive. We are attacking a practice called “evergreening.” “Evergreening” is what branded pharmaceutical companies do when they seek additional patents, often of dubious validity or utility, to artificially extend the monopoly pricing they can charge under the shelter of patent protection. One notorious example involves patenting the use of a rubber stopper in a vial containing the drug. Another one patented sugar speckles on a pill and claimed this provided benefits to people who take a lot of pills. In another famous patent, a drug company got a patent for using a “centralized database” to track users of the drug. The patent office erroneously went ahead and granted these patents and hundreds of others, despite their being ineligible for patent protection for various reasons, including being “obvious.”

We’re not alone in criticizing evergreening. A recent NYTimes article written by an endocrinologist from Yale shares the shocking story of how the US patent office keeps granting new patents on insulin – a compound that’s been around for 100 years – that allows the three giant pharmaceutical companies making the compound to rake in billions of undeserved dollars from US patients and taxpayers. The patents have not only blocked generic manufacturers from coming in and lowering prices, they’ve allowed the big drug companies to hike prices by 168% to 325% over the last few years. People are endangering their health by cutting dosages because they can’t afford the vital medication. We can’t blame Ms. Lee for permitting these patents to issue and historical evergreening practices – they happened before her time. What we want to know is what she’s doing about it now. Is she permitting the abusive “evergreening” practice to continue by putting her thumb on the scale and interfering with Patent Trial and Appeal Board (PTAB) judges impartially calling “balls and strikes” when it comes to invalidating these bogus patents?

The US patent office is an obscure government agency that many people have never heard of, despite the fact that it promotes flagrant corporate welfare for large branded pharmaceutical companies that costs American consumers and taxpayers billions of dollars a year. We didn’t think that challenging this corporate welfare was going to make us popular with the management at the patent office. We didn’t know how unpopular until we saw the results of a Freedom of Information Act (FOIA) request that was filed with the patent office this past Summer that produced 611 heavily redacted pages.

The vast majority of pages—other than a publicly available copy of a House bill used to “bulk up” the number of pages—were completely or mostly blank, other than a statement “Withheld pursuant to exemption (b)(5) Atty Client Priv (b)(5) Delib Proc Priv of the Freedom of Information and Privacy Act”—known in FOIA circles as “Exemption 5.”  The Justice Department’s website says that the courts have interpreted “Exemption 5” to

exempt those documents, and only those documents that are normally privileged in the civil discovery context.

We find it incredibly hard to believe that all of this redacted material meets that standard.

Many other pages showed email headers with the to/from details, date, and subject fields – including tantalizing subject lines such as “Kyle Bass” — but no content other than “Exemption 5.”

Many of the emails went right to the top – to Michelle K. Lee.

You can see all 611 pages here.

_______________

  1 Hour CLE Briefing ~ Cuozzo v. Lee
SCOTUS has cleared the way for the PTAB to continue its practices
with respect to Inter Partes Review Proceedings. On Tuesday,
July 12, 2016, at 3pm Eastern, join Eugene M. Paige
of Kemer & Van Nest LLP. CLICK HERE to REGISTER.


_______________

 

Missing documents—this is not transparency

Here are a few examples of the problems we see in those 611 pages:

  • Biotechnology Innovation Organization, known as BIO, is a lobbying organization representing the branded pharmaceutical industry. BIO had a meeting with Lee and her staff in February, 2015. Attendees included the CEO of BIO — who as a former member of Congress is a great lobbyist — and CEOs of pharma companies. This meeting between pharma, Michelle Lee, and her top lieutenants, was held less than a month after word of our initiative to stop evergreening was leaked to the press. It was extremely cordial of Ms. Lee and her team to have a meeting with top pharma executives and lobbyists on less than 30 days’ notice. Kyle and I requested a meeting the same month through numerous emails and phone calls—the emails are included in the production—and we are still waiting for a date when we can meet with Ms. Lee and her team. It’s an outrage that Ms. Lee is showing incredible bias by granting meetings to the people that are gouging American patients, consumers and taxpayers and denying the same access to the people who are attempting to end this abuse.
  • At a recent TED conference, Ron Cohen, the CEO of Acorda Therapeutics (and the current Chairman of BIO) made the outrageous accusation that Kyle and I were destroying innovation. This is rich coming from the man that has reigned over massive near 1,000% price increases over the past few years for a drug that Acorda acquired, where the compound went off patent in 2003 and is now protected by patents where the “novelty” is improved walking speed. We have no objection to pharma getting patents for real innovation and new products and charging whatever they want. What we object to is the patent office cooperating with pharma to artificially extending monopoly pricing with bogus patents. (Ron—our invitation to debate you and anyone from BIO you want to bring along on GMA or any other forum you select, stands—since you appear to have significant influence with her, maybe you can get Ms. Lee to join us for this shindig.)
  • On page 407 there’s an email to Michelle Lee with briefing materials for the BIO meeting that were prepared by BIO. Not only are the many pages of the BIO briefing materials themselves redacted, but in the email the list of what’s included is redacted. We don’t even know what’s missing. How can materials prepared by BIO and shared with Ms. Lee be privileged?

What we can see is a very biased attack against us, including a statement from BIO that “…Kyle Bass has opened a new door to abuse of the US patent system…” We agree someone is abusing the system, we simply disagree as to who’s doing the abusing.

Since when is it an “abuse” to challenge patents that never should have been issued in the first place? If the patents were actually valid, they’d easily survive our challenges and pharma would have nothing to worry about.

The minutes from this meeting are also missing.

What’s Michelle Lee hiding?

  • You can see multiple emails from Kyle requesting a meeting with Michelle Lee and her team. Somehow she was never able to meet with us, despite our repeated attempts and offer to meet anytime, anyplace.

How come BIO could get a meeting in less than 30 days, but we can’t get one in over a year?

  • The patent office’s Chief Economist sent a report to the “Patent Litigation Task Force” (redacted, of course) that included a look at “stock market reactions to the Kyle Bass petitions.” Since everything is redacted, we don’t even know why such a study was called for, or is relevant to the operations of the patent office, or how much taxpayer money was spent on it.Why is the patent office executive staff hearing from an economist about the stock market and our IPR filings? To help them “feel the pain” of the price-gouging pharma industry when its invalid patents get challenged? Patent office management doesn’t need a presentation on the stock market, they need a presentation on patent validity; it would be nice if they also took a hard look at evergreening. They could also use an explanation that the US Patent Office does not work for the pharmaceutical industry.Why doesn’t the PTO staff get the chance to hear about evergreening and how branded pharma and the US patent office are working together to artificially keep drug prices high? They are doling out welfare to the greediest corporations on the planet by improperly extending monopoly pricing with flimsy patents.
  • There’s an email from a journalist (p. 428) quoting an interview with Kyle saying, “It appears to me, after the Biogen ruling, that Michelle Lee and the US Patent & Trademark Office are running a Kangaroo Court,” and “Michelle Lee should stick to calling balls and strikes as Congress legislated her to do through the America Invents Act. And she should stop forwarding her political agenda and ignoring the law.”Any emails commenting on this are redacted, so we don’t know what Michelle Lee’s response was. Did she agree or disagree?

 

What’s Michelle Lee Hiding?

What we want to know is, “what’s Michelle Lee hiding and why?”

Obviously you don’t have to hide compliments. So we assume the hidden information must be derogatory and likely embarrassing to the patent office and Ms. Lee.

Just so you know, Ms. Lee – we can take it. You don’t have to worry about hurting our feelings. Whatever you or your staff called us, we’ve been called worse.

So that leaves the likely motivation to hide the information as embarrassment– and “embarrassment” isn’t a statutory basis for claiming privilege and omitting or redacting documents under a FOIA request. As repulsive as this may seem to you, you actually work for the people and not branded pharma. BIO and huge branded pharmaceutical companies are not your clients or even your main constituency and they should be shown no more favor than any other stakeholder—even hedge fund managers, patent monetizers and those “annoying little people” that are patients, consumers and taxpayers.

 

What’s the agenda?

Not only is there a lack of transparency, but Michelle Lee seems to be continuing to push the same misguided agenda she pushed when she was at Google.

In a recent speech at the Consumer Electronics Show, she spouted the completely discredited figure of “patent trolls” “draining $80 billion from our economy every year.” (See “The Mythical $83 billion/year Damage to the Economy from Patent Trolls,” for full details.)

That number’s a joke – and Michelle Lee is smart enough to know it.

She’s a government employee in charge of running the US patent office for the benefit of inventors, patent owners and society in general. So why’s she spreading this phony anti-patent-owner propaganda? Why is she protecting pharma and promoting improper practices that cost US patients and taxpayers billions of dollars a year?

 

Without Fear or Favor

All we’re asking is that the patent office does its job impartially – “without fear or favor.” When it comes to reviewing the validity of granted patents, we want it to “call balls and strikes” without worrying about whether the call will anger team owners, players or fans.

While the patent office serves a number of stakeholders, it should favor none of them to the detriment of others. Patents should be granted and invalidated based on their merits – not based on lobbying or the impact on the stock market.

If the patent office is subject to political or corporate pressure, that would be an embarrassment (or worse). Evidence of improper considerations might be something the office would want to redact.

So again we ask, “What’s Michelle Lee hiding?”

The Author

Erich Spangenberg

Erich Spangenberg is the CEO of nXn Partners, LLC. nXnP is focused on predictive analytics

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 39 Comments comments. Join the discussion.

  1. xtian February 29, 2016 11:48 am

    In the same vein of transparency, would it be in the public interest to disclose your (and Mr. Bass as well) shorted stock positions in the companies that you filed the IPRs on?

    Also, by my calculations, you only have a 24% rate of successfully getting the PTAB to institute your IPRs. Would you agree then that the patents for which you failed to institute an IPR were eligible for patent protection and properly granted by the USPTO?

  2. Gene Quinn February 29, 2016 12:00 pm

    xtian-

    I can’t, don’t and won’t speak for Kyle Bass or Erich Spangenberg, but I will point out that at least one of the PTAB decisions to deny institution was one of the most egregious and poorly reasoned decisions of any tribunal on any level that I have ever read. The conclusions of law reached by the Board were breathtakingly erroneous. See my analysis at:

    http://www.ipwatchdog.com/2015/09/02/ptab-denies-another-kyle-bass-ipr-petition/id=61333/

    -Gene

  3. Bemused February 29, 2016 12:09 pm

    Erich,

    Its the right “message” (invalidate clearly obvious pharma patents that are costing American taxpayers billions of wasted dollars every year) but you’re the wrong “messenger” (accurate or not, you’re the poster child of the ugly patent troll – a perspective that you yourself have cultivate through NY Times, etc interviews). There’s no intended malice in that statement but the reality is that if one is going to take on the powerful pharma industry and its huge K Street lobbying apparatus, then it requires a messenger that is (or is perceived as) completely untainted by bad reputation or profit motive. For example, if an organization like the AARP had championed this fight, I wonder if they would have had more success with getting PRs instituted and/or they would have gotten broader (more favorable) press coverage or would have been able to get Congressional interest/investigation into the low rate of IPR institutions on pharma patents?

    Bemused

  4. rr February 29, 2016 12:22 pm

    xtian: The NYTimes article Erich refers and hyperlinks to in the article expressly states he and Bass are shorting the stock. No lack of transparency there. Secondly, your question about the validity of the other alleged 76% of patents not having an IPR instituted goes to the heart of Erich’s article. He does not believe that they are getting a fair shake at the PTAB and Lee’s ridiculous and obstructive responses to Erich’s FOIA request is evidence supporting his claim that the Patent office is not playing fair. Pharma has every right to file patents to defend its products to increase their profits and Erich and Bass have every right to invalidate them to increase their profits. As the PTAB stated in the Celgene matter, “profit is at the heart of nearly every patent.”

  5. Xtian February 29, 2016 12:28 pm

    Gene – bad decisions by courts and tribunals get made all the time. To continue to bash those patents that have been granted, and survived an IPR institution as “bad” gives the impression that Mr. Spangenberg’s is targeting pharma, and his actions are not altruistic in nature that the system can be improved. As Bemused points out – he is a bad choice for a champion.

  6. JNG February 29, 2016 12:41 pm

    Erich

    Page 361 of the Government’s guidelines tells you that they do not qualify under the threshold for the privilege they are trying to assert:

    “In 2001, the Supreme Court had its first opportunity to interpret the Exemption 5
    threshold in Department of the Interior v. Klamath Water Users Protective Ass’n.
    Its ruling implicitly accepted (but did not directly rule on) the concept of the consultant corollary, while placing important limitations on its use. In its unanimous decision, the Court ruled that the threshold of Exemption 5 did not encompass communications between the Department of the Interior and several Indian tribes which, in expressing their views to the Department on certain matters of administrative decision making, not only had “their own, albeit entirely
    legitimate, interests in mind,” but also were “seeking a Government benefit at the expense of other applicants.”

    The pharma lobbyists here are clearly seeing the same benefit at the expense of the public. Given their identity and the stated purpose of the meetings, the PTO cannot make any case that they are privileged.

  7. David February 29, 2016 1:12 pm

    “BIO had a meeting with Lee and her staff in February, 2015. Attendees included the CEO of BIO — who as a former member of Congress is a great lobbyist — and CEOs of pharma companies”

    This is a perfect example of why this Article I arrangement isn’t even remotely close to being constitutional.

  8. Erich Spangenberg February 29, 2016 3:50 pm

    xtain-
    1. Transparency: One reason is I am not a government agency and I do not have to be transparent (nor have I ever publicly stated that my goal and desire is to be transparent)
    2. Batting Average: You need to check your math — your are way off (see below) or check out Bloomberg story from today
    3. Altruism: What part are you missing–we have stated over and over we are for profit and not altruistic (with the exception of perhaps two filings where we were a little altruistic)
    4. Curious: Why do you post using an alias? It is likely the only publicity you will ever get

    Bemused:
    1. Messenger I: I called the Pope and AARP to ask them to lead the charge, but never got a call back — so Kyle and I just did it
    2. Messenger II: I think you are wrong–the irony of what we did has created its own marketing power (I would not expect you to understand) and our extensive conversations with politicians and generic and branded executives, prove me right (as BIO and PhARMA will tell you–there are about 800 people who matter in this particular tussle–and oddly enough, we are not viewed as the lower caste at this particular soiree)
    3. See #4 above

    Case
    Filing Date
    Instituted/Denied
    IPR2015-00720
    2/10/2015
    Denied
    IPR2015-00817
    2/27/2015
    Denied
    IPR2015-00988
    4/1/2015
    Instituted
    IPR2015-00990
    4/1/2015
    Instituted
    IPR2015-01018
    4/6/2015
    Denied
    IPR2015-01076
    4/20/2015
    Denied
    IPR2015-01086
    4/22/2015
    Denied
    IPR2015-01092
    4/23/2015
    Instituted
    IPR2015-01093
    4/23/2015
    Instituted
    IPR2015-01096
    4/23/2015
    Instituted
    IPR2015-01102
    4/23/2015
    Instituted
    IPR2015-01103
    4/23/2015
    Instituted
    IPR2015-01136
    5/1/2015
    Denied
    IPR2015-01169
    5/7/2015
    Denied
    IPR2015-01241
    5/21/2015
    Denied
    IPR2015-01344
    6/5/2015
    Denied
    IPR2015-01680
    8/7/2015
    Denied
    IPR2015-01718
    8/12/2015
    Instituted
    IPR2015-01723
    8/13/2015
    Denied
    IPR2015-01776
    8/20/2015
    Instituted
    IPR2015-01780
    8/20/2015
    Instituted
    IPR2015-01785
    8/20/2015
    Instituted
    IPR2015-01792
    8/22/2015
    Pending
    IPR2015-01797
    8/24/2015
    Pending
    IPR2015-01799
    8/24/2015
    Pending
    IPR2015-01800
    8/24/2015
    Pending
    IPR2015-01835
    8/28/2015
    Pending
    IPR2015-01836
    8/28/2015
    Pending
    IPR2015-01850
    9/2/2015
    Pending
    IPR2015-01853
    9/2/2015
    Pending
    IPR2015-01857
    9/3/2015
    Pending
    IPR2015-01858
    9/3/2015
    Pending
    IPR2015-01993
    9/28/2015
    Pending
    IPR2016-00245
    11/24/2015
    Pending
    IPR2016-00254
    11/25/2015
    Pending

  9. Appearance of ... February 29, 2016 4:23 pm

    In the spirit of recent SCOTUS decisions, I humbly submit my proposed “technology neutral” solution for these pesky IPR problems.

    It is a simple two part test:

    1: Is the IPR “unworthy?”

    2: If so, is there “something more” that makes the IPR “worthy?”

    If the IPR fails both parts of the test, then the IPR is rejected without further discussion or opportunity for review.

    I decline the invitation to actually familiarize myself with the other legal issues surrounding the IPR process. Further, I need not labor to to delimit the precise contours of either “unworthy” or “something more”.

  10. Ken Lisaius February 29, 2016 5:01 pm

    It’s not surprising that USPTO head Michelle Lee is uninterested in meeting with Erich Spangenberg, as he is party to ongoing proceedings being adjudicated by the agency she oversees. Nor should the PTAB be swayed by an obvious attempt to improperly influence forthcoming decisions by a man The New York Times has labeled “one of the most notorious patent trolls in America.” Contrary to his claims, Spangenberg and his ally Kyle Bass are not simply attacking “evergreening” patents, but they are going after novel medicines’ valuable and fundamental composition of matter patents. Spangenberg is clearly abusing a weakness of the USPTO administrative review system that unfairly stacks the deck against legitimate patent owners. In so doing, he’s is damaging the companies working on cures for sick and suffering patients.

  11. Gene Quinn February 29, 2016 6:55 pm

    Ken-

    I appreciate your response. It does, however, seem that Michelle Lee met with BIO and discussed at least in part the filings by Kyle Bass. If I’m reading the FOIA documents correctly, there was a meeting, but the information about the meeting, what was discussed at the meeting, what documents BIO provided and the names of BIO representatives present at the meeting were all redacted. If Michelle Lee didn’t want to discuss the matter that would seem an appropriate position to take, but taking a meeting with BIO and not taking a meeting with Bass/Spangenberg makes it seem as if the agency is picking sides.

    I personally have no problem with Lee meeting with BIO, and I disagree that it would be inappropriate to meet with Bass and/or Spangenberg. Perhaps this is the lawyer in me speaking, but it is commonplace for the Solicitor General, for example, to meet with both sides to a case before deciding what position the government will take in a case being argued at the Supreme Court. So the problem isn’t in having a meeting, the problem is in having a meeting with only one side. The further problem is then refusing a FOIA request. I can’t think of any reason why a meeting with BIO would be attorney client privileged.

    As for Spangenberg exploiting a weakness of USPTO administrative reviews, that is not unique to Spangenberg and Bass. IPRs were a terrible idea from the start. They should never have been supported. Unfortunately, the Biotech and Pharma industries supported IPRs as a part of the AIA. So if they are good for other people’s patents it only seems appropriate that they can and should be an available tool to be used by those who challenge all patents, including biotech and pharma.

    -Gene

  12. Erich Spangenberg February 29, 2016 7:53 pm

    Ken–
    1. I understand you are a VP of communications for BIO
    2. The chairman of BIO (Ron) is also the Chairman and CEO of Acorda and it seems he was at the meeting with Ms. Lee — how is that not a conflict or attempt to sway? You and the rest of branded pharma are used to buying people off–must have been a tad frustrating when you realized this would not work
    3. An insignificant change to a compound can still be evergreening — but you knew that, right–you simply misspoke?
    4. What is worse–being a notorious patent troll or a CEO who raises prices 1,000% over a five year period–when they bought and did not discover the compound or indication? You are all Shkreli’s — just with better suits and ties
    5. You all thought IPRs were awesome when other people’s oxen were being gored–not so awesome anymore, huh? Still all in with Google on this? Usually a mistake to make deals with the devil
    6. I will up the offer–I will donate $100,000 to any charity you pick, if you and Ron will debate us in a public forum? Interested?

  13. c'mon February 29, 2016 9:59 pm

    Email dated August 25, 2015 from non-USPTO employee “Adil S. Ahmed” (justadilahmed@gmail.com) to USPTO employee Farheena Rasheed contains text that is completely redacted under Exemption 5. Why is the email of a non-USPTO employee, Adil S. Ahmed, redacted?

  14. angry dude February 29, 2016 10:33 pm

    PTO corruption is nothing new
    It started long before highly publicized NTP vs RIM case which ultimately led to the pivotal Ebay decision which killed the patent system for the rest of us – small under-capitalized patent holders

    “On Saturday, January 1, 2005, Theodore W. Kassinger, the Deputy Secretary of the Department of Commerce, sent an email to Mr. Dudas to arrange a meeting with RIM officials. The substance of Mr. Kassinger’s email to Mr. Dudas has been redacted without the assertion of any claim of privilege or exemption under FOIA. Redaction of the email without an assertion of a privilege or exemption is improper. Further, to the extent that Mr. Kassinger’s email reflects the substance of any discussion with RIM or its representatives, that information should have be noted in the record of decision.

    Mr. Dudas responded on January 2 thanking Mr. Kassinger for arranging the meeting. He indicated he would be in his office on Tuesday, January 4, and that Jennifer Lo, the Under Secretary of Commerce for Intellectual Property, could work with Jane Dana, the Acting General Counsel of the Department of Commerce, to “set up a convenient time to meet with Mr. Cameron”, a lawyer for RIM. A copy of this email is attached to the Anderson Declaration as Exhibit 5 p. 1.

    Copied on Mr. Dudas’ January 2 email, in addition to Ms. Lo, were Steve Pinkos, Deputy Under Secretary of Commerce and Deputy Director of the PTO, and Eleanor K. Meltzer, an attorney-advisor in the office of Legislative and International Affairs of the PTO. Ms. Meltzer forwarded the emails between Mr. Kassinger and Mr. Dudas to James Toupin, General Counsel of the PTO, and John Whealan, Deputy General Counsel and Solicitor for the PTO. NTP infers from these facts and circumstances that Messrs. Toupin and Whealan joined Mr. Dudas and other Commerce Department and PTO officials to meet with Jim Balsille, President and Co-CEO of RIM, and Don Cameron, RIM’s Canadian counsel, on January 4, 2005. See Anderson Declaration Exhibit 5, p. 45.

    To prepare for the meeting with Mr. Balsille, Mr. Dudas requested that the PTO prepare briefing materials for him on, among other things, the status of the reexaminations of Patent Owner’s patents and the lnfrngement Action. Ms. Meltzer sent a “High” Importance email at 9:36 A.M. on January 3 requiring, by 3:00 P.M. that day, the PTO to provide the following briefing materials for Mr. Dudas:…”

    I am sure Mr. Dudas had a long and profitable career in a private industry after his PTO tenure… unlike the majority of American independent inventors he was supposed to serve while in office…

  15. c'mon February 29, 2016 10:53 pm

    Email dated July 16,2015 from Dana Colarulli forwards a subscription-only POLITICO Pro alert to numerous other USPTO officials. The bottom of the email alert contains the following disclaimer: “This email alert has been sent for the exclusive use of POLITICO Pro subscriber Dana Colarulli. Forwarding or reproducing the alert without the express, written permission of POLITICO Pro is a violation of federal law and the POLITICO Pro subscription agreement.”

    Ironic how the USPTO has violated federal copyright law.

  16. angry dude February 29, 2016 11:09 pm

    I just reached out to my very dusty closet to get an original PTO copy of my patent dated 2006 signed by Mr. Dudas which states as usual:

    “…the right to exclude others from making, using or selling the invention.. blah blah blah…”

    What is this “right” worth to me ? Zero, zilch, null…

    I am thinking of burning it on the steps of US Capitol when the 3rd maintenance fee comes due…

  17. Paul Morinville February 29, 2016 11:36 pm

    Personally, I think it is fair game to IPR any patents owned by any large company who supported the AIA. The reason for the IPR is immaterial. Eat what you sow.

    As for Michelle Lee, I am convinced she is acting on behalf of Google, her former employer, and the tech industry, her future employer. My respect for her management of the PTO could not be lower. I’ve now filed my sixth appeal. I’ve won at least three so far and lost none. Several have gone into a second appeal. I believe my examiners are being instructed to reject no mater what and I believe that order is coming from the top seat in the PTO. If I were rich or was going to live forever, it would be OK, but I unfortunately am neither. The way I am being treated by my government, I will either die first or go broke before I get a patent for my inventions.

    This is the sickening reality of the PTO. So, getting back to Erich. Have fun. You are doing God’s work and it must be done.

  18. angry dude March 1, 2016 12:03 am

    Paul Morinville@15

    Paul,

    With all due respect, why do you need a patent in the current environment ?

    If I knew better I would never applied for one back in 2002..
    alas… too late

    it would save me years of my life AND many thousands of papers with the pictures of dead US presidents (some of them being the actual founders of the US patent system)

  19. Paul Morinville March 1, 2016 2:46 am

    Angry Dude@16. It’s gone beyond getting a patent now. Mine are massively infringed so I’ll probably never be able to build a company based on them, which is all I really wanted. Now this has escalated. This is my damn country. Those traitorous bastards can’t have it. Now I want the fight.

  20. Night Writer March 1, 2016 7:23 am

    In the big picture category: I think that what is going on here is that the whole system has become rigged. Lee is a tool of Google mainly, but Obama realizes that other corporate interests have to be met in order to receive his money from them. So, what you get is a rigged system and the only way to get what you want is to have connections.

    So, third world country here we are. Thanks Obama.

  21. Night Writer March 1, 2016 7:26 am

    I think a lot of our problem is Obama. He never got anything done his whole life. And so he doesn’t understand the power of rules and how they can empower people to get stuff done and motivate them to take chances because the rules are there and we all get a fair treatment.

    So, instead what we have this is giant corrupt system where you have to be friends with someone and K Street muscle to get anything done. I think Obama’s use of executive power is part of this problem. (Note that Obama is independent of policies. One can have a strong social system, but one that isn’t corrupt.)

  22. Edward Heller March 1, 2016 8:27 am

    This all shows a fundamental problem with placing administrative patent revocation of any kind in the patent office, there is no standing requirement. Anybody can bring a reexamination or an IPR at any time and for any reason. Some would say this is a design flaw. Others would say it is a feature.

    But I would just like to say that patents are the property of their owners who have a right, in my opinion, to a day in court before their patents are invalidated by anybody for any reason. I think this whole venture into post-grant reexaminations/IPRs is folly and is ruining the patent system.

    As to whether Pharma is abusing the patent system by evergreening or something like that, that is something that should be taken up with Congress, not with the patent office. If somebody is accused of infringement with respect to a patent that is invalid, they have their day in court as well to tell the judge and the jury why the patent is invalid. That is where this debate should legitimately be taken with respect individual patents. Any larger debate is a debate about policy and that is a debate that should be taken the Congress.

  23. A Rational Person March 1, 2016 9:33 am

    Gene@11

    Agree 100%. Also, thank you for publicly taking a stand and calling out the USPTO for failing to act impartially.

  24. Night Writer March 1, 2016 10:15 am

    Edward @20 Anybody can bring a reexamination or an IPR at any time and for any reason.

    Actually, the system could actually be a lot more capricious if the director actually decided on which patent to institute the IPR. Since it is non-reviewable that could be a completely political process.

  25. Edward Heller March 1, 2016 10:15 am

    A rational, this whole affair show everyone that the PTAB does what the Director tells them to do. So long as that is even possible, and it will always be possible so long as the IPR judges are not Article III judges, no patent owner is guaranteed a right to a fair trial.

  26. Xtian March 1, 2016 11:24 am

    @Eric “What is worse–being a notorious patent troll or a CEO who raises prices 1,000% over a five year period–when they bought and did not discover the compound or indication? You are all Shkreli’s — just with better suits and ties”

    Why the morality judgment against raising pharma prices? I could make the same statement vis-a-vis you shorting pharma stock when filing the IPR. Morality or public policy(however that is defined) shouldn’t come into play. Public policy setting is for government.

    I have to say, thanks for responding. I didn’t think you would. And, after reading your post, I actually appreciate your honesty. You clarified that you are not acting altruistic. You clarified that you are seeking a profit in shorting the stock. I’m actually o.k with that. The rules of the game were set, you are just playing by them. To the extent others don’t like how the rules allowed you to play – they should go cry to their representative to change public policy (what Bio is trying to do). In the same vein, pharma will utilize the rules to maximize its profits (in your words “evergreening patents”); and people like yourself will benefit from IPRs. That’s how we play the game.

    As far as my anonymity- I actually don’t crave the publicity. I crave the discussion among different views.

    NB. I see my error in my calculation. I included the “pending” IPRs in my numerator when calculating your success percentage. As of IPR2015-01723, I now see that you were successful in getting in 8 of 19 or 42% of your cases instituted. However, I caveat that with the fact that three of those IPR were on the same patent, and 4 of the successful 8 IPRs are on patents in tech center 3600, not the typical pharma 1600 art unit. I also question why you don’t go after claim 1 in some of those IPRs? Even if you are successful in some of those IPRs, claim 1 of the patent won’t fall and generics still own’t be able to come on the market. (Or should I also realize that this is part of the game – short on the filing, buy on the decision…)

  27. xtian March 1, 2016 11:32 am

    Just checking the IPR website (confirming your list in your comments above), I see that you recently were successful in getting instituted the three IPRs filed against patent’s covering Anacor’s KERYDIN product. The decision came out on the 23rd. Anacor’s stock was aound 68 on the 24th, and today is rests below 60 – a 10%+ move to the downside….

  28. Brad Olson March 1, 2016 11:53 am

    Gene: I will sidestep the subject matter at issue here. However, I do want to thank you and IPWatchdog for continuing to provide a forum for controversial thoughts and positions that really do matter in the IP world. You have shown a willingness to address controversial topics such as this one, as well as the Francis Gurry WIPO scandal of a few years ago. Please keep up the great work!.

  29. Edward Heller March 1, 2016 12:27 pm

    Night, do you not have a problem with the whole concept that anyone, at any time and for any reason can hail you into the PTO and put you to great expense so they can make a buck off your falling stock price, or pursue some self-appointed public policy agenda where you are just a whipping boy?

  30. Night Writer March 1, 2016 1:26 pm

    >>Night, do you not have a problem
    Huge problem with the AIA–huge. Patents are now the sport of kings… From what I see big corp is filing more and more patents and little guy is less likely to file.

    Of course, Alice is just as bad and just as unconstitutional. I think IPRs are unconstitutional Edward, but I think our courts are dysfunctional and operate based on policy and not the Constitution or the laws.

  31. Night Writer March 1, 2016 1:28 pm

    If you put yourself through the discipline of actually predicting the outcome of cases, you will see that policy very often trumps the law and the Constitution. And, you will see that most judges are policy oriented always putting their finger on the scale to make the outcome what they think it should be (not legally, but for equity.)

    We only have equity courts in the US now.

  32. Anon2 March 1, 2016 2:13 pm

    Paul Morinville @19

    YES!

    I wish you every success in your fight, for your and all our sakes.

  33. angry dude March 1, 2016 3:24 pm

    Edward Heller@29

    IPRs are about presumption of validity for patents duly issued by the PTO.
    If an actual issued patent is more like a registration paper and anyone relying on this patent has to go through full $500K IPR proceedings to make it a real enforceable patent then why bother with patents ? especially for small and medium size businesses.
    I say allow a team of 3 examiners to spend a week on each patent application and consequently raise PTO fees 5-10 times, but please make every piece of paper coming out of USPTO actually worth something.
    Right now it’s a joke: they sell you something and then take it back at their will – even little kids are taught not to do this

  34. A Rational Person March 1, 2016 3:35 pm

    Angry Dude@33

    “Right now it’s a joke: they sell you something and then take it back at their will – even little kids are taught not to do this”

    Maybe in these more political correct times we could champion the substitution of the term “USPTO giver” in place of a certain term that disparages Native Americans?

    🙂

  35. Xtian March 1, 2016 4:34 pm

    @angry dude- how?s this converse: Let’s be like South Africa’s registration system. The USPTO will rubber stamp my patent for $200. If the patent is really annoying or egregious, someone will file and IPR and it will either be upheld or revoked. Back end examination versus front end.

  36. Curious March 1, 2016 4:39 pm

    Night, do you not have a problem with the whole concept that anyone, at any time and for any reason can [haul] you into the PTO and put you to great expense so they can make a buck off your falling stock price, or pursue some self-appointed public policy agenda where you are just a whipping boy?
    Welcome to the new era. Inventors are evil and infringers are the Robin Hood — taking from the rich and giving to the poor (oh wait, the most egregious Robin Hood’s these days are taking from the poor inventors and enriching themselves to the tune of billions of dollars).

    The patent system wasn’t broke — it was working as intended. Does the healthy working of a patent system sometime involve huge sums in damages? Well, yes. Did certain individuals abuse the system by employing information/negotiating asymmetry? Undoubtedly. However, there were mechanisms already in place to police such activities. Unfortunately (for inventors) and fortunately (for infringers), that abuse was used as an excuse by both the Courts and Congress to drastically reduce the usefulness and value of patents — for both the good actors and bad actors.

    The system is currently set up so that if you are a small inventor going up against a larger inventor, you have little hope in succeeding. Between IPR death squads and District Courts using 35 USC 101 to clear their dockets of patent cases, there is little hope for the little guy. The subject of this article involves the twist where the same tactics being used to knock out the patents of the little guy are also being used against the big guy’s pharma patents, which as a group, are likely the more valuable than any other type of patent.

    Personally, if the system is put in place for people to short stocks and then bring an IPR to drive down the stock price, I don’t blame these people. If there is blame to be had, it should be directed to the people who set up the system in the first place.

  37. Edward Heller March 1, 2016 5:33 pm

    There seems to be a consensus here that IPRs are bad for everyone. The little guy cannot afford the expense of one so he must remain quite and watch his invention being pirated until he can afford an IPR. This, of course, was an intended feature of the IPR.

    But the IPR viper has now bitten the big guy as well, to the extent their business relies on the patent system, which is mainly true of Pharma and Bio. A big guy’s main patent can be attacked by a short seller in a process where only 3% of patents have their claims confirmed if trial is instituted and where 75% of petitions result in trials. (Figures are approx.)

    Admittedly, when two sides battle it out over an issue, the fact decider has a much better understanding of the issues. So it is not surprising that a significant number of issued patents are held invalid, even over the same art. But, still, the 70+% invalidity rate is well above the court invalidity rate of 43%. See, John R. Allison, et al., Understanding the Realities of Modern Patent Litigation, 92 Tex. L. Rev. 1769, 1801 (2014).

  38. Max Patent March 2, 2016 7:35 am

    On page 407, the briefing materials attached to the email sent to Michelle Lee in preparation for her meeting with BIO were forwarded for printing. The forwarded email shows one of the documents is named:

    “PTABonBogusPetitions2-23-15.docx “.

    Who prepared that document?

  39. jodi March 2, 2016 10:58 pm

    So small software entities have to fight for 7, 8, 9, 10+ years for truly novel patents to issue, while Pharma keeps renewing 100 year old insulin?!?!

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