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In Written Responses to Senators’ Questions, Vidal Supports Iancu’s 101 Guidance ‘In Principle’

“Given the uncertainty in the law, USPTO examination guidance was and is necessary to optimize consistent decision-making across art units and examiners. I support the principle of such guidance.” – Kathi Vidal

https://depositphotos.com/7784847/stock-photo-answers-time-concept-clock.htmlIn written answers to Senators’ questions for the record submitted today by Kathi Vidal, President Joe Biden’s nominee for the next U.S. Patent and Trademark Office (USPTO) Director, Vidal said that she “support[s] the principle of” former USPTO Director Andrei Iancu’s 2019 Revised Patent Subject Matter Eligibility Guidance for examiners, but stopped short of wholly endorsing the present guidance or committing to keeping it in place. Instead, Vidal said she would review the guidance in light of intervening case law and comments on the USPTO’s study on the state of patent eligibility jurisprudence to determine if updates are needed.

Only Senator Thom Tillis (R-NC) asked Vidal directly about her approach to patent eligibility. The topic also came up in her response to Senator Chuck Grassley’s (R-IA) query about which policies of the previous administration she would keep in place, to which she replied that she would continue reforms made “in patent strength, trademark registry integrity, transparency and inclusiveness.” As part of that, Vidal said she would “also review and update as appropriate guidance on 101 (patent eligibility) based on the results of USPTO study Senators Tillis, Hirono, Cotton and Coons requested on the current state of patent eligibility jurisprudence in the United States and on how that jurisprudence has impacted investment and innovation and based on intervening law since the last update in October 2019.”

Additionally, Vidal said she would review stakeholder feedback on the Patent Trial and Appeal Board (PTAB) solicited under Iancu “to determine if prior policies strike the right balance and whether more is needed.”

But in her reply to Tillis’ more direct question on Iancu’s examiner guidance, Vidal punted on addressing whether she actually supports it.

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Tillis asked: “As you know, the previous USPTO Director issued examiner guidance related to patent eligibility. Do you support that guidance?”

And Vidal replied: “Given the uncertainty in the law, USPTO examination guidance was and is necessary to optimize consistent decision-making across art units and examiners. I support the principle of such guidance.”

During her recent hearing in the Senate Judiciary Committee, as well as in her written responses, Vidal acknowledged that today’s jurisprudence on patent eligibility “provides neither clarity nor consistency,” and implied that the current examiner guidance is presently consistent with the law. But her written responses raise a question about whether her promises to review the guidance in light of intervening jurisprudence –which she admits is chaotic – might actually roll back some of the benefits Iancu’s changes brought for patent owners.

PTAB and Big Tech Abuse in Focus

All of the senators who submitted questions for the record asked Vidal about her plans for the PTAB. Vidal echoed the sentiment of other patent stakeholders who have commented on the topic that, with 10 years of data accumulated since PTAB proceedings were implemented, it may be time to review and potentially revise the procedures. She explained:

For example, I know based on my experiences (representing both patentees and patent challengers), and through common knowledge, that there is a wide disparity in how different courts deal with the parallel proceedings issue (a patent being challenged simultaneously in both the USPTO and in another tribunal such as district court) and related issues (estoppel, motions in limine related to IPRs and PGRs). Some judges will stay a parallel proceeding once an IPR/PGR is filed, some wait for institution, and some rarely stay. Beyond that, there are other criteria for stay that vary by tribunal, judge and individual case. The impact these procedures may have on small inventors or SME’s (Small to Medium-Sized Enterprises), and potential abuses of the IPR/PGR process these procedures allow, should be evaluated to inform potential changes to PTAB practice.

Senators John Kennedy (R-LA) and Marsha Blackburn (R-TN) each asked several questions related to the PTAB and the potential imbalances in the system that may favor Big Tech over small inventors. Kennedy asked if Vidal agrees with the general proposition that the USPTO examination and PTAB processes favor Big Tech and Vidal replied that, while litigation of any kind can disadvantage small entities, “the USPTO applies the same statutory requirements during patent examination and in PTAB adjudications for all, regardless of the size of the applicant, patent owner or petitioner.” She also pointed to the Office’s fee discounts for small and micro entities for patent examination and maintenance, as well as for PTAB appeals, including the USPTO’s pro bono program for patent prosecution and soon-to-be pilot for PTAB appeals. As to concerns over serial filings by Big Tech companies, Vidal said “[t]he latter is somewhat ameliorated by the PTAB’s ability to exercise its discretion under General Plastic Co., Ltd. V. Canon Kabushiki Kaisha, IPR2016-01357 (PTAB Sept. 6, 2017) (precedential), to prevent the filing of multiple challenges against the same patent.”

Blackburn asked Vidal to comment on pending lawsuits against former USPTO Director Michelle Lee that accuse Lee of “stacking the intellectual property system against inventors” and how Vidal would ensure that such stacking is addressed. Vidal replied: “To the extent there is concern the USPTO and the patent system are stacked to favor large companies and against small inventors, that can diminish confidence in our IP system and can impact innovation and investment in the same. It needs to be investigated.”

She also noted in her reply to Blackburn’s question about whether she, like Lee, has represented Silicon Valley clients in patent matters, that she has had clients across the spectrum, from Fortune 100 and Silicon Valley companies to underrepresented individuals. However, she also noted in response to a question from Senator Josh Hawley (R-MO) that she has never represented Facebook, Twitter, Apple, Google, or Amazon specifically while at Winston & Strawn. She concluded: “If confirmed, I would commit to working with you, this Committee, and stakeholders to work on initiatives related to any perceived biases, build confidence in our IP system and promote access, education and support for all stakeholders.”

Other Senators included in the QFR responses were Patrick Leahy (D-VT); John Cornyn (R-TX); and Ted Cruz (R-TX).

 

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19 comments so far. Add my comment.

  • [Avatar for Anon]
    Anon
    December 14, 2021 05:05 pm

    Maybe Tillis should have followed up with a question such as, “Have you been directed to take any particular stance on how to treat eligibility?”

    Vidal appears to have been a more-than-capable soldier, rather than a leader who sets her own vision. This may portend to an ill direction based on what her marching orders are.

  • [Avatar for Curious]
    Curious
    December 14, 2021 11:28 pm

    Instead, Vidal said she would review the guidance in light of intervening case law and comments on the USPTO’s study on the state of patent eligibility jurisprudence to determine if updates are needed.
    This is hardly controversial. The executive branch (USPTO) executes the laws as interpreted by the judicial branch. Iancu put forth the 2019 Patent Eligibility Guidance based upon the case law existing at the time. 3 years later, that guidance is going to change based upon the new case law that was added in the interim.

    Setting aside for a moment that this case law is an irreconcilable mess, the answer Vidal gave was precisely the answer she should give.

    As a practical matter, Vidal has little power to CHANGE the current patent system. Congress makes the laws and the Courts interpret them. While the USPTO has some leeway in terms of how they can implement some of the laws, that leeway is quite limited.

    If the USPTO issued every application that passed through their doors, it still wouldn’t matter if the courts killed every one that passed through their doors.

  • [Avatar for Josh Malone]
    Josh Malone
    December 15, 2021 10:35 am

    @Curious, the USPTO Director has near absolute power to change the patent system! The PTAB is by far the most popular venue for patent cases with by far the highest rate of invalidation. A good Director can solve one of the biggest, if not the biggest problem with the patent system today. If she will provide reliable guidance on how to get a patent that won’t be invalidated by the PTAB, then we would be on our way.

    But I also agree that 101 procedure in the courts is also a big problem that is beyond her power.

  • [Avatar for Curious]
    Curious
    December 15, 2021 01:57 pm

    the USPTO Director has near absolute power to change the patent system!
    Let me rephrase my comment: “If the USPTO issued every application [and denied every IPR request] that passed through their doors, it still wouldn’t matter if the courts killed every one that passed through their doors.”

    Director can solve one of the biggest, if not the biggest problem with the patent system today.
    I know you had your issues with the PTAB so it is near and dear to your heart, but that is not the biggest problem with the patent system. Even if the PTAB didn’t exist, your patents still would have been challenged at the District Court level. At best, Vidal could prevent some of the abuses (e.g., serial challenges) at the PTAB, but that means little if your patent still die in federal court. Moreover, she cannot stop challengers from still going to the PTAB.

    If she will provide reliable guidance on how to get a patent that won’t be invalidated by the PTAB, then we would be on our way
    Don’t have a patent for which there is good 102 and 103 art? That’s as good as guidance as any. However, the existence (or lack thereof) of good prior art is out of both her hands and your hands.

    But I also agree that 101 procedure in the courts is also a big problem that is beyond her power.
    102, 103, and 112 issues at the District Court level are also out of her hands. We don’t run into those as much these days because much is getting weeded out at the 101 level.

    If you want true PTAB reform, you need to go to Congress — not Vidal. Whatever Vidal “fixes” can conceivably be undone by the next USPTO Director. You need reform that doesn’t rely upon the magnanimity of whomever sits upon the throne (er .. I mean in the Director’s office).

  • [Avatar for Josh Malone]
    Josh Malone
    December 15, 2021 04:40 pm

    @Curious there is always 103 prior art. Inventors don’t create ex nihilo.

    The Director can “prescribe regulations” to deny institution when it would have a harmful “effect on the economy [or] the integrity of the patent system”. For instance when it is used by a market incumbent to steal technology, multiply cost, expand litigation, or impose risk on a small competitor.

    Such a regulation would go a long way toward solving one of the biggest problems with the U.S. patent system.

    It’s not just me, it’s all the startups that aren’t getting funded because the USPTO won’t stand behind their product.

    PTAB should be reserved for small businesses trying to fend off patent trolls, or circumstances where it can serve as a faster, less expensive alternative to district court litigation.

    The current PTAB is not bring run consistent with what Congress said in 2011.

  • [Avatar for Pro Say]
    Pro Say
    December 15, 2021 10:56 pm

    Josh: “The current PTAB is not being run consistent with what Congress said in 2011.”

    Just like the CAFC not being consistent with SCOTUS’ Mayo and Alice decisions.

    Indeed, were both consistent, American innovation wouldn’t be in the terrible (and getting worse — now camera innovations can’t be protected) condition it is.

    And what does Congress have to say about this sorry state of affairs?

    See no evil . . . hear no evil . . .

  • [Avatar for Anon]
    Anon
    December 16, 2021 09:13 am

    Josh and Pro Say,

    Sadly, both of you are in error.

    First, what Congress did in 2011 is exactly what is happening (and to deny that is an error of the first degree, and will prevent a real solution from taking hold).

    Second, to think that the prime fault of the mess in eligibility is from the CAFC is to remove the ability to correct the actual prime source of the mess: The Supreme Court.

    Both of these points should be well understood by now. Your posts to the contrary are thus unhelpful in the attempts to provide the grounds for a true and lasting solution.

  • [Avatar for Pro Say]
    Pro Say
    December 16, 2021 10:40 am

    Anon @ 7, while you are of course correct that the ultimate, foundational fault for the eligibility mess America finds itself in today rests with SCOTUS (which Josh, I, and others have repeatedly also said is the case), were the CAFC and the PTAB correctly following evidenced-based, carefully-cabined Mayo / Alice, American innovation would indeed be in better shape.

    Far better.

    If and until the whole loaf shows up (something which only Congress itself has the constitutional authority to bake), America’s innovators will gladly accept a half a loaf.

    When one is starving, a half loaf staves off starvation.

    Sorry my friend, but because we’re starving, we’ll take that half loaf.

    Gladly.

  • [Avatar for Anon]
    Anon
    December 16, 2021 11:05 am

    I hear your point, Pro Say, but caution that this “accept half” will only lead to half again until you have only crumbs.

    When the issue is as stark as it is with the Supreme Court needing to be chastised, there be real danger to the “Peace in our times” (or, ‘at least a piece in our times’) mindset.

  • [Avatar for Josh Malone]
    Josh Malone
    December 16, 2021 12:06 pm

    This is a helpful discussion. While the night is dark, day may be dawning. The Supreme Court is glacially shifting, 9-0 in 2006 to 2014. 7-2 in 2018 (despite the USPTO Acting Director’s prediction of a sweep), 3-3-3 in Arthrex.

    The counter-assault against the USPTO is effective – outside of our tiny IP bubble. Even Patrick Leahy and Lamar Smith didn’t expect the USPTO to kill off small competitors to strengthen incumbent monopolies. Their staff who are banking millions now expected it, and the PTAB Bar is totally fine with it. But it is utter nonsense to everyone else.

    The implementation of the PTAB is one of the biggest problems for innovators, but it’s more than that.

    The USPTO assaulting inventors is a huge perception problem and vulnerability. People outside the bubble are increasingly aware of the rot and corruption and corporate favoritism – it is totally counter to the text and spirit of the AIA.

    Even the sponsors and advocates acknowledge this is not what they intended. A large segment of the bubble is ignoring it, perhaps because they were complicit or else it’s the only way they can put food on their table. But it will crumble as the truth is exposed.

  • [Avatar for Anon]
    Anon
    December 16, 2021 02:32 pm

    Again, I have to disagree with the statement of “it is totally counter to the text and spirit of the AIA” given the plain fact that many (including me) ruled against the quite evident Efficient Infringer legislative capture during the process of the AIA becoming law.

    What you see now is what was fully intended then.

  • [Avatar for Pro Say]
    Pro Say
    December 16, 2021 04:56 pm

    Anon: “I hear your point, Pro Say, but caution that this “accept half” will only lead to half again until you have only crumbs.”

    But look in our weathered hands . . . we already have only crumbs.

    As time marches on . . . shredding patent term as it does . . . our patents and applications are dying on the vine.

    It does us individual inventors and SMEs no good, no good at all, to wait, hope, and pray that Congress will entirely right the eligibility ship by restoring patent protection to all areas of innovation.

  • [Avatar for Anon]
    Anon
    December 16, 2021 05:35 pm

    “Ruled against” should read “riled against”

    Pro Say – then prepared for your path to lead to half of the current crumbs.

  • [Avatar for Model 101]
    Model 101
    December 17, 2021 03:28 pm

    She’s a crook.

    Everything she says is political BS.

    Nothing will change.

    Judges who aren’t really judges????

    Come on….

    Don’t kid yourself.

    No due process.

    Claim construction is meaningless.

    Evidence doesn’t matter.

    Expert testimony doesn’t matter.

    Why do you think Biden nominated her.

    She’ll do whatever he says.

    He’s nothing but a crook.

    Hunter’s art has no value but to infringing big tech moguls.

    Give me a break!

    Don’t patent anything.

    All you’ll do is tell big tech how to do it.

  • [Avatar for Moderate Centrist Independent]
    Moderate Centrist Independent
    December 18, 2021 06:37 pm

    More useless focus on the PTAB while ignoring the lack of quality ex parte examination.

  • [Avatar for Anon]
    Anon
    December 21, 2021 07:22 am

    MCI,

    While I may well agree with you that focus should be (and for a long time, should have been) on examination quality (as opposed to the putative – and propagandized “Patent Quality”), the focus on the systemic bias and LACK of integration of any asserted post grant quality control INTO the aforementioned examination quality is not a useless focus.

    What you seem to desire CAN BE reached with a focus on what the PTAB is doing.

    So unless you have a different and unstated aim, I would suggest that you pause and reconsider your view.

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