Reflections on Oil States: Are There Silver Linings Amidst the Doom and Gloom?

By Eric Guttag
April 29, 2018

Reflections on Oil States: Are There Silver Linings Amidst the Doom and Gloom?In its decision issued April 24, SCOTUS ruled (7-2) in Oil States Energy Services v. Greene’s Energy Group that inter partes review proceedings (IPRs) conducted by the Patent Trial and Appeal Board (PTAB) do not violate Article III, or the 7th Amendment of the U.S. Constitution.  Needless to say, the decision to uphold the constitutionality of IPRs is very disappointing to me and many others in the IP world, and the dissenting opinion by Justice Gorsuch (joined by Chief Judge Roberts) is astute and correct in being highly critical of the reasoning in the majority opinion, especially as it relates to whether the McCormick Harvesting decision was based on a statutory authority issue (per the majority) or a constitutional “separation of powers” issue (per the dissent).  See my comments below in that regard.  That being said, there may be some potential “silver linings” in this decision, especially when considered in the context of the companion SAS Institute decision (5-4) where Gorsuch’s majority opinion held that PTAB must rule on all claims challenged in an IPR, not just those that are deemed invalid by PTAB.

Let me first say that 7th Amendment challenge was the weakest.  Indeed, the majority opinion spent less than a page on that challenge, and the dissent didn’t even comment on that aspect at all.

But as Sherlock Holmes might say, where “the game was afoot” was in the challenge based upon the Article III “separation of powers” issue, namely that only an Article III court (per McCormick Harvesting) can adjudicate the validity of a granted patent.  The majority opinion makes several cringe-worthy statements that simply don’t hold up when scrutinized.  First, the majority says that the grant of a patent falls within the “public-rights doctrine.”  Whether that is correct or not is beside the point.  But the majority then makes the astounding “leap of logic” that IPRs “involve[] the same basic matter as a grant of a patent.”  That statement is a manifest and improper conflation of two very distinct and different processes:  (1) the grant of the patent (an ex parte examination process); and (2) the determination of the validity of a granted patent (a contested adjudicatory process).  Indeed, the majority should have done its “legislative intent” homework.  Congress’, and especially the Senate’ version (S.1041) of the AIA characterize IPRs, as well as all other post-grant proceedings as being adjudicative, whereas the grant of the patent is an examination.  See especially Matal’s, A Guide to the Legislative History of the America Invents Act, p. 443, footnote 53.  To put it bluntly, the examination which grants the patent is in no way “the same basic matter” as an IPR adjudication as the majority opinion would have you believe.

In this regard, in my opinion and others, the advocate for Petitioner Oil States made a tactical error during oral argument in this case.  In response to Ginsburg’s initial question that “there must be some means by which the Patent Office can correct errors that it’s made,” the advocate for Oil States started off well by saying the USPTO could correct patents through ex parte reexamination.  Unfortunately, that advocate then stumbled when Kagan followed up by asking “what about inter partes reexamination?” by suggesting that inter partes reexamination “was a closer case,” but being an “examination,” was different from IPRs which are “adjudicatory.”

Like others have suggested, I would also have thrown inter partes reexamination “under the bus.”  Admittedly, reexamination is an “examination” process while IPRs are an “adjudicatory” one.  But the key distinction here is whether the patent owner voluntary initiates the procedure (as certainly can happen in ex parte reexamination-I would also argue that third-party initiated ex parte reexaminations are an entirely different story).  In other words, by initiating ex parte reexamination, the patent owner can voluntary waive its constitutional rights on having the validity of its patent determined by an Article III court.  By contrast, IPRs (as well as inter partes reexamination) are not initiated by the patent owner, nor can the patent owner opt out of IPRs (or inter partes reexamination) without risking having their patent rights invalidated.  That makes the patent owner’s participation in IPRs totally involuntary in terms of not waiving its constitutional right to have the validity of its patent adjudicated in an Article III court.

With respect to what McCormick Harvesting means, the majority treats the holding in this case as a mere issue of lack of statutory authority of the Commissioner of Patents to annul or correct the granted patent.  But Gorsuch (as well as I and many others) see McCormick Harvesting quite differently as being based upon a more fundamental constitutional Article III question of “separation of powers,” and especially the independence of the judiciary, versus the potential lack thereof in an administrative tribunal such as PTAB (such lack of independence being well documented through, for example, “panel stacking,” and APJs sitting on IPRs involving former clients).  That fundamental Article III question comes directly out of the language used by SCOTUS in McCormick Harvesting, as quoted by Gorsuch in his dissenting opinion:

“It has been settled by repeated decisions of [SCOTUS] that when a patent has [been issued by] the Patent Office, it has passed beyond the control and jurisdiction of that office, and is not subject to be revoked or cancelled by the President, or any other officer of the Government.  It has become the property of the patentee, and as such is entitled to the same legal protection as other property.”

Gorsuch’s dissenting opinion further quotes from McCormick Harvesting on the point that “annul[ment]” or “correct[ion]” of a granted patent “for any reason whatever, is vested in the courts of the United States, and not in the department which issued the patent.”  If the question were merely one of statutory authority, as opposed to one of constitutional “separation of powers,” SCOTUS would have used very different language in McCormick Harvesting.  Indeed, as reflected in McCormick Harvesting, even SCOTUS back in the 19th Century recognized that the grant of a patent was different in character from post-grant proceedings.  That the majority opinion refuses to acknowledge this distinction, as even Congress acknowledged in the enabling legislation for IPRs, is mind-boggling, and rightly criticized by Gorsuch’s dissenting opinion.

Another egregious statement in the majority opinion is its characterization of a patent grant as being a “public franchise.”  I, other patent attorneys, and may be even Gorsuch, would wince at such a gross mischaracterization of a patent grant.  In particular, the analogy by the majority opinion of a patent grant to being similar to “permit[ting] a company to erect a toll bridge” is extremely inapt.  Patent grants are in no way similar to a “franchise” which is often for the purpose of permitting someone to do something they may not otherwise legally do.  By contrast, patents give the owner to right to tell others they cannot do something, i.e., “make, use, or sell” the claimed invention.  And never mind that this gross mischaracterization of patent rights by the majority opinion overlooks and overturns more than 200 years of case law, including that of SCOTUS, some of which is referred to in McCormick Harvesting, as well as the express language in 35 U. S. C. § 261 which characterizes patent rights as “having the attributes of personal property.”

Speaking of 35 U. S. C. § 261, another problematical issue with the majority opinion is its reliance on the prefatory “subject to the provisions of this title” clause of this section of the patent statutes as suggesting that “those provisions include [IPRs].”  In effect, the majority views this prefatory clause to 35 U. S. C. § 261 as constituting acceptance of an implied waiver of the patent owner’s right to argue that IPRs are a “taking” of its “personal property” under the 5th Amendment “without due process,” at least as to patents granted (or more accurately, having an effective filing date) on or after March 16, 2013.  That view is consistent with the majority opinion’s further statement that Oil States “does not challenge the retroactive application of [IPRs], even though that procedure was not in place when its patent issued.”  (As I discuss further below, even the majority opinion recognizes that IPRs implicate the 5th Amendment “takings clause” as it relates to patent grants having effective filing dates prior to March 16, 2013.)  Nonetheless, the reliance by the majority on this prefatory clause in 35 U. S. C. § 261 as acceptance of a potential implied waiver of the patent owner’s 5th Amendment “due process” rights is, in my opinion, very suspect.  This prefatory clause in 35 U. S. C. § 261 (this section being also titled as relating to “Ownership; assignment”) was present when this particular section of the patent statutes was first included back in 1952, and long before IPRs (or even reexamination procedures) were later added.  It is far more logical that this prefatory clause would involve how some other section of the patent statutes affect ownership of patent rights and what that means (and is what is specifically addressed in 35 U. S. C. § 261), or possibly implicates some other sections (such as 35 U. S. C. §§ 101, 102, 103, or 112) which were part of the original 1952 patent statute.  But to say that this general (and somewhat ambiguous) prefatory clause necessarily includes any other section of Title 35, especially those added long after 1952 (including those relating to IPRs) is another huge and puzzling “leap in logic” by the majority.

That being said, and following up on the feeling of “doom and gloom” many of us had upon initial issuance of the Oil States decision, there is some reason for hope here in at least reigning in some of the impact of IPRs.  The majority opinion concludes by “emphasiz[ing] the narrowness of [its] holding,” i.e., it only addresses the 7th Amendment and Article III challenges.  Or as I’ve characterized this portion of the majority opinion, it suggests the wrong questions were asked by Oil States.  Instead, it suggests Oil States should have asked the following questions:  (1) was retroactive application of IPRs proper, even though that procedure was not in place when Oil States’ patent issued?; and (2) may IPRs be challenged on “due process” and “takings clause” grounds (stating that “our decision should not be misconstrued as suggesting that patents are not property for purposes of the Due Process Clause or the Takings Clause”).  With reference to the second question, note in particular that the majority cited the Florida Prepaid case which relates to 11th Amendment sovereign immunity of the states and their institutions.  That citation has direct implications in the University of Minnesota’s appeal to the Federal Circuit of PTAB’s ruling (wrong in my view and others) in the Ericsson decision that state institutions (such as state universities) waive their 11th Amendment sovereign immunity in IPRs if they have brought a separate patent infringement suit in federal district court.  The second question also certainly implicates whether IPRs, as procedurally structured or as substantively determined, comply with the Administrative Procedures Act (APA).  In terms of APA compliance either procedurally or substantively, IPRs are highly vulnerable to attack for many different reasons, including “panel stacking,” as well as failure to ensure that APJs sitting on PTAB panels are free from potential “conflict of interests” or abide by any “code of ethics” similar to those of judges to insure objectivity of and lack of bias by them.

Regarding the first question of retroactive application of IPRs, I’m still astounded that Oil States didn’t offer this aspect as a potential “fall back” position.  In fact, during oral argument, Justice Kennedy offered the hypothetical of “we will grant you a patent on the condition that you agree to this procedure, [i.e., IPRs].”  Kennedy followed that question up with another one (noting it was a “basic question patent lawyers would probably know the answer”), namely “could Congress say that we are reducing the life of all patents by 10 years?”  As even Kennedy understood, Congress can’t retroactively “change the rules” on what a property right provides (and even the majority opinion in Oil States acknowledges that with this first question) without implicating the “due process” and “takings clause” of the 5th Amendment.  (I have sneaking suspicion that Kennedy knew that the advocate arguing for Oil States was not a “patent lawyer.”)

That advocate’s response “yes, I think it could” (further stating “that goes to the limited times requirement”) isn’t the answer I would have given Kennedy.  Consistent with what I’ve said above, Congress could not constitutionally decrease the patent term for an existing patent right without violating the 5th Amendment “due process” and “takings clause.”  In fact, Congress itself is cognizant of this restriction, as evidenced when it last changed the patent term in 1995 to 20 years from filing date, but carved out an exception that, for applications filed before the effective date of that change, the old patent term of 17 years from issue date would remain.  (Indeed Roberts further hinted during oral argument that way by pointing to the “takings clause” of the 5th Amendment.)

My original prediction that Gorsuch was clear vote to hold that IPRs unconstitutional in view of Article III proved prophetic, and he at least got Roberts to agree with him.  The majority opinion, while extremely disappointing (as well as being plagued with several misstatements and mischaracterizations), still evidences some significant concerns about the constitutionality of IPRs if applied retroactively to patents (like that of Oil States’) having effective filing dates prior to March 16, 2013, and whether there may be other 5th Amendment “due process” and “takings clause” issues to address, including state sovereign immunity under the 11th Amendment.  So the story on the constitutionality of IPRs in all circumstances is not over yet.

*© 2018 Eric W. Guttag.  All views and opinions expressed herein are those of the author only.

The Author

Eric Guttag

Eric Guttag  
Mr. Guttag has over 38 years of corporate and private intellectual property law experience on patent, trademark, copyright, trade secret and unfair competition matters, computer and Internet law, including patent application drafting, prosecution, and patentability studies; infringement and validity studies; international patent prosecution; patent and know-how licensing; consulting, confidentiality, clinical study and research agreements; trademark searches and opinions; trademark registration and prosecution; trademark freedom-to-use studies and trademark litigation and dispute resolution.

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 22 Comments comments.

  1. Anon April 29, 2018 9:19 am

    it suggests the wrong questions were asked by Oil States.

    Wow. does this echo the many posts that I have made on this topic – and all the “I Robot” video clips of: “you must ask the right question” that I posted over the course of the issue (including back through Mr. Heller’s efforts).

    HOWEVER – a lot of this “silver” is tarnished with the fact that by not asking the right question, the Court has “moved the ball” from discussing items that may have been Constitutionally protected under other Constitutional provisions (i.e., property is protected under Takings law) to something else entirely.

    The ball has moved from any notion of “property” having protections to now, what types of “other Constitutional protections” does this murky – and self-professed “uneven” – jurisprudence of “franchise” carry?***

    Do “franchises” carry the same protections that property carry?

    When (if ever) does a franchise (which is more reminiscent of an inchoate right) “mature” into that (now mythical) real property right?

    It is (still) only after a transformation INTO an actual full legal property right that the other Constitutional protections may apply.

    Not understanding this has led many into believing that some “new” mythical hybrid exists – that this thing called a patent is somehow BOTH a “franchise” and (still) a personal property.

    It’s a neat trick to merely “say so.” But merely saying so is nowhere near sufficient. Without a bright line, one always has the “it’s the franchise aspect that I’m talking about” argument present.

    *** The Court’s near manic obsession with staying away from “bright line” rules (perhaps in fear of scriveners who really do know patent law far better than the Royals would be able to “dance around” any bright lines drawn by powers who – let’s be totally honest here – do not understand what lines they are drawing). From eBay, to 101, and now to the essential aspect of patents as property, the Court has delighted itself in making the law into a wax nose (for themselves to stick their fingers in).

  2. Josh Malone April 29, 2018 10:51 am

    They decided the way the experts from the USPTO and DoJ suggested. It is not ignorance. It was a deliberate calculated sell out.

  3. EG April 29, 2018 12:27 pm

    Hey Anon,

    Thanks for the comments. And I did note you’re earlier comments on other posts about were the right questions were asked in Oil States in formulating my post.

    As far as whether the “silver” has been “tarnished,” you are correct to wonder whether it has in Oil States gross mischaracterization of patent rights as being equivalent to a toll bridge “franchise.” But my view is that you need to test the “retroactive application” question that the majority leaves to see if it has any legs. If it does, the impact of IPRs, at least initially, is greatly diminished, as IPRs are only appropriate for those patents having effective filing dates on or after March 16, 2013. If that question is a mere canard (and I’m cynical enough about SCOTUS to think that’s possible), we’ll a more fundamental problem to address with Congress about reigning in the “court of last resort” that abides by no rule of law or consistency in precedent as it relates to patent law that you, I, or many others can accept. In that situation, it’s either jurisdiction stripping of SCOTUS to hear any appeals involving patent law, or accepting that the status of and respect for U.S. innovation will continue to plummet below it’s current position as 12th, on par with that of Italy (and no offense to Italians is intended either).

  4. Night Writer April 29, 2018 1:02 pm

    I think you missed the big Article III argument that the majority used. The incorporation of English common law. In fact, one way to contest Oil States is to look at the “facts” of whether the Privy Counsel was in fact empowered to cancel patents at the time of our Constitution. Ned said no. Lemley wrote a paper that was relied on by the majority.

    If the answer is no, then invalidity may only be by an Article III court.

  5. Night Writer April 29, 2018 1:15 pm

    Plus, I think there is actually much bigger possible downside.

    We do not address whether other patent matters, such as
    infringement actions, can be heard in a non-Article III
    forum. And because the Patent Act provides for judicial
    review by the Federal Circuit, see 35 U. S. C. §319, we
    need not consider whether inter partes review would be
    constitutional “without any sort of intervention by a court
    at any stage of the proceedings,” Atlas Roofing Co. v.
    Occupational Safety and Health Review Comm’n, 430 U. S.
    442, 455, n. 13 (1977).

  6. The Time Is Now To Act April 29, 2018 3:18 pm

    The following is put forth in hopes of a better tomorrow; and, toward healing and strengthening our once Crown Jewel.

    At this stage, Congress and Director Iancu must proceed to ask not:

    ‘How do we stop the (non-material) trolls?’

    But, rather,

    ‘What havoc has been wrought on the patent system and how quickly can we fix it?’

    If America does not legislatively right this ship, the post AIA blood bath of recent memory is simply the tip of the iceberg .

    I share EG’s concern about the SCOTUS liberal court majority canard of ‘hey, we have been having a blast with these patent cases for years! Bring another!’

    Rather, we as the community that cares about the efficacy of the patent PROPERTY RIGHT need to:

    1) Rain a storm of productive, SPECIFIC AIA reform down on capital hill. And, fight like no other for clear, well written law created with the INVENTOR (small or large – individual or corporate) in mind.

    2) Get behind the White House, Secretary Ross and Director Iancu and get the right legislative fix in place in protection of the patent right.

    This is a different Commerce Department leadership than we’ve seen in quite a long time – an unbroken line of elite business people from the President to Commerce Secretary to the Undersecretary of Commerce.

    First time Government servants that CARE.

    Let disappointment fuel ACTION.

    This is a fight for U.S. dominance in global trade.

    And, Dear Mr. President,

    We CANNOT dominate as you desire without ALL INVENTORS ON DECK.

    And, like any trade, inventor families cannot be fed a meal of uncertainty and poverty!

    Your army is before you, Sir. Collectively, they are thousands. But, individually they are as small in number as the farmers who won America her independence.

    But, save an forceful wind of 180 degree change, your army disbands forthwith at the very moment when you need it.

    I wonder, with only the largest multinational corporations and Communist nations left as the inventors, how long it will be before they use that power in very interesting ways to cripple America’s ability to SOVEREIGNLY lead the world.

    Years ago I would have said ‘NO WAY’. Today, I fear it’s imminent arrival as reality.

    THE TIME IS NOW TO ACT!!!

  7. Ternary April 29, 2018 4:46 pm

    Some of my inventions which are in cryptography, use descriptions that are by themselves novel and not known math. This leads to rejections as: the table is merely an operation that is a generator polynomial that when executed generates the table and thus is abstract. (hello, how does that work? Do you people at the PTO, including a panel with 2 SPEs even read the nonsense that is being produced? More likely, like me, you cannot make sense of it either.)

    Anyway, I have developed additional novel computer operations that cannot be captured by “known math.” Novel processor operations that can be used in cryptography and for which (currently) no known math exits. I have checked the operations in computer programs, and they work. I also know how to modify known cryptographic methods (such as RSA key exchange and SHA message digests) with the new processing steps, which, because of being unknown, can for instance dramatically reduce the size of RSA keywords (now recommended at being 3072 bits or longer) or increase security against novel (quantum-computer based) attacks.

    I have a decision to make if I want to file a patent application: write it all up, provide a consistent and coherent notation, explain it in understandable language without making it appear to be math, enable one of ordinary skill to make and use it, make the drawings, find related art, … Or, as my boss used to say: blah, blah, blah, blah, blah… (He was an excellent patent attorney and is an outstanding engineer, but has left the patent world in disgust). All formulaic nonsense that an Examiner and Courts will only read to see if you inadvertently admit something on which they can reject but rarely accept as proving a point as it then becomes attorney argument. All in all a byzantine and useless exercise in futility, designed to let the inventor explain in detail to infringers what they need to know how to use the invention. Without a shred of help from the PTO or the Courts to protect my work. Bait-and-switch is the technical term. The sine-qua-non for inventors seems to be that they are basically crooks because they want protection for their invention, as opposed to scientists who share their ideas with the world.

    I have the satisfaction of developing this “new processing.” I know that it works and how it works and I see no use, under the current regime, in sharing it with anyone. It is either known or obvious and then I am stupid or a crook to try to get a patent; or it is novel, pioneering and clever but abstract, alas and I am delusional (and still a crook) in trying to get it protected. Let alone when I get a patent and try to enforce it. Then I am really a crook (or a troll, which is not a derogatory term). I see few silver linings in the patent system. The patent system has become a disincentive.

  8. angry dude April 29, 2018 7:46 pm

    Josh Malone @2

    “They decided the way the experts from the USPTO and DoJ suggested”

    Correct. But those “experts” are just paid puppets themselves – they consulted with corporate boardrooms in SV and elsewhere before making their “suggestions” to scotus
    This was in fact the only possible outcome at this point of US Patent System destruction – for scotus to decide otherwise in Oil States would be exposing the largest SV corporations (and most importantly – their over-inflated stocks) to a lot of risk
    So Trump’s (as well as Obama’s) administration would rather sacrifice not just all independent inventors in USA (wtf cares about us anyway ?) but also small and midsize tech companies with important foundational tech patents just to save a few largest tech corporate stocks like Amazon’s and Google’s from falling a few percentage points …
    And those “blue chip” tech stocks of course are part of various 401Ks and other retirement plans so wiping them out would generate a lot of outrage on Wall Street and from lemmings in the general population
    On the other hand wiping out all independent inventors in US as well as all patent valuations behind small/mid size tech companies will largely go unnoticed by the media and lemmings

    Oligopoly rules in this country.

  9. angry dude April 29, 2018 7:53 pm

    Ternary @7

    Dude, this is no-brainer decision

    If you can keep it as trade secret for a while then go ahead and try to commercialize it – find correct business application, business partners etc

    If not – forget about it

    patents are gone, gone, gone…

    RSA patent would be shot down today in the first office action as “pure abstract math”

  10. step back April 29, 2018 8:10 pm

    Section 101 is an invitation, an offer so to speak for almost all inventors to come forth and submit their know how, “Whoever invents or discovers any new and useful … may obtain a patent therefor, subject to the conditions and requirements of this title.”

    Section 102 provides a statutory entitlement, “A person shall be entitled to a patent unless– …”

    Section 122 spells out part of the quid pro quo deal, the know is kept confidential until the patent is granted.

    Section 155 is the final installment on closing the deal, the contract … “Upon payment of this sum the patent shall issue …

    And as well known, according to section 261, “Subject to the provisions of this title, patents shall have the attributes of personal property.”

    So ergo and therefore, a revocable at whim “franchise”?

    http://patentu.blogspot.com/2018/04/oil-states-and-despicable-toll-bridge.html

  11. Benny April 30, 2018 5:33 am

    Angry @8,
    Quote – “And those “blue chip” tech stocks of course are part of various 401Ks and other retirement plans…”
    Er…that’s my pension too…I’m sort of relying on it to keep my pantry stocked in my later years. I suppose you are, too. And so, too, I would imagine, are most “independent inventors”. I put that in quotations marks because the overwhelming majority of patents I’ve encountered covering valuable technology are assigned to companies, big or small, and not to independent inventors (many of whom, I would guess, couldn’t afford the attorney fees required to draft and prosecute a patent through to grant).

  12. Anon April 30, 2018 7:17 am

    Benny,

    You are confusing symptoms and causes along your march up Lemming Hill.

  13. EG April 30, 2018 7:56 am

    Hey NW@4,

    I hear you but all that intellectual blathering about the Privy Council and so forth by the majority is meaningless drivel in the face of the holding (as correctly read by the dissent) in McCormick Harvesting that an adjudication of a granted patent is only proper in an Article III Court. Instead of following their own precedent, and more importantly, reading the patent statutes (e.g., 35 USC 261) as more than an inconvenience to be ignored at will, they continue (as Anon) would say to stick their fingers “into the nose of wax.” That’s why we have chaos in the patent world and is why the U.S.’s reputation in innovation is sinking and will continue to sink until SCOTUS is told by Congress, as it was back in 1980 when the Federal Circuit was created as a not so subtle “shot across the bow” of SCOTUS, to keep its fingers out of patent law jurisprudence.

  14. Night Writer April 30, 2018 9:16 am

    @13 EG

    Maybe you are right. The typical character of a justice of the SCOTUS is worse than rapists and murders I’ve dealt with. I think the thing that bothers me most about dealing with the SCOTUS is that they write things that are so obviously contrived and yet act as if they are the smartest little boys and girls in the world and that we are so stupid that we can’t figure out their little games. Either that or it is a in-your-face lie as in what are you going to do about it. I think people like Lemley exist because of the perfidy of the SCOTUS. Lemley writes “journal papers” that drip with BS and misrepresent cites and leave off counter case law and facts. The SCOTUS says, oh yeah, just what we were looking for. Someone lower than us to lie so we can write an opinion based on BS.

  15. angry dude April 30, 2018 10:08 am

    Night Writer @14

    “…leave off counter case law…” created by scotus itself

    reconciling or just remembering their own past decisions is not scotus job anymore

    sigh

  16. angry dude April 30, 2018 10:17 am

    Benny @11

    Dude, you are clueless as usual

    Serious independent inventors with valuable tech patents (at the time when US patent system actually worked as designed) used to create shell companies like LLCs and assign patent rights to those companies

    This was always done before starting any patent licensing or litigation campaign for the purpose of shielding personal liability and assets

    as for sacrificing small/mid size tech companies with their tech patents so save the likes of amazon and google from little stock trouble – shame on you, dude
    and shame on USA government for doing that

  17. Benny April 30, 2018 10:20 am

    Angry,
    Just out of curiosity, how many patent applications and file wrappers have you actually read in your career?

  18. Ternary April 30, 2018 10:50 am

    Interesting question Benny @17. In particular because almost all patents that have been invalidated either in IPRs or over Alice were drafted by attorneys and agents who supposedly have drafted many applications and have read hundreds of file wrappers in PAIR.

    The Dude is correct on independent inventors and LLCs. It was one of the first recommendations I received from my attorney.

    Just out of curiosity Benny, how many inventions have you personally done as an independent inventor that generated a patent? And if you have any, do you recommend it to future inventors?

    My impression is that you, the Dude, I and others have come to the rational conclusion (aside from emotional arguments) that for independent inventors the pursuit of a patent in the US has become a futile and wasteful activity as there are no longer substantial assets to defend. In that sense the USA has become like Europe, but with lower filing fees.

  19. Benny April 30, 2018 10:58 am

    Ternary,
    Only service inventions assigned to my employers. I wouldn’t file an application as an independent inventor due to the extremely low chance of seeing a return on my investment, even assuming the patent isn’t invalidated.

    My impression is that attorneys only read applications and file wrappers when they can invoice a client for the time spent doing so. Engineers and in-house legal teams, on the other hand, will read them on their own time.

  20. EG April 30, 2018 11:01 am

    Hey NW@14,

    Thanks for the further reply. I attribute that “contrived writing” to an arrogant, holier than us “mere mortal” and “nerdy lawyer” attitude that I also endured when I was in corporate practice over 2 decades ago. (As a chemistry major undergrad, I also got a BA degree at Carleton College, a well-respected liberal arts school which had and still has outstanding science departments, so I do take homage at those who view us “nerdy lawyers” as something beneath their dignity.) That we now see the Royal Nine relying upon the articles and amicus briefs written by so-called IP law professors, many of whom have no science or technical degree, does make my blood boil when I see such arrogance.

  21. Ternary April 30, 2018 12:18 pm

    Benny, that is true. Patents, patent applications and office actions (if one ignores the legalese mumbo-jumbo) form a fast track in getting rapidly educated in a new technology or technological idea. That is the only promise that the patent system has fulfilled: it teaches one of ordinary skill how to practice the invention without undue experimentation. Often, as a competitor, you even don’t need a full explanation of an invention, but only the idea itself. Which is now laid open for the taking.

  22. angry dude April 30, 2018 12:38 pm

    Benny @17

    many dozens at the minimum (I would not say hundreds) through USPTO Public PAIR system

    but it was a while ago when I was in prosecution and then in litigation at some point

    completely stopped doing it 5 years ago – pointless waste of my time