The Road Ahead: Predicting IP Developments to Watch in 2022

Empty asphalt road and New year 2022 concept. Driving on an empty road to Goals 2022 with sunset.Once again, this year we asked a selection of IP stakeholders to weigh in on what important IP events they see unfolding in the year ahead. While crystal balls were not required, respondents were encouraged to take their best-educated guesses about what the future holds for IP in 2022. From the Federal Trade Commission (FTC) to the Supreme Court to the International Trade Commission (ITC), there is a lot to keep on our radar. Here is what our contributors had to say.

Alden AbbottAlden Abbott
Mercatus Center, George Mason University

Now that new leadership is in place at both the FTC and DOJ, additional initiatives to undercut patentees’ legitimate property rights may be expected soon. Look to the FTC, likely joined by the Justice Department (DOJ), to revive its Obama-era crusade against standard essential patent (SEP) holders’ efforts to obtain fair returns to their property. New DOJ policies toward standard setting arrangements (as foreshadowed by DOJ’s 2021 disavowal of the Trump Administration’s approach to SSO policy) aimed at weakening the leverage of SEP holders and favoring implementers over patentees are likely. One possible constraint on agency litigation attacking SEP and other patent rights is the judiciary. The 9th Circuit’s 2020 Qualcomm decision overturning an FTC antitrust challenge to Qualcomm’s licensing practices demonstrates that many federal court remain open to fully weighing companies’ efficiency justifications for restrictive patent licensing arrangements.

Nick Aries
Bird & Bird

Looking outside the United States, I would say: (1) expect the Unified Patent Court to start functioning in the second half of 2022, or early 2023, (2) watch out for any impact the reforms may (or may not) have which were introduced in Germany in summer 2021 regarding the granting of injunctions for patent infringement and trying to speed up the time between filing a nullity suit and getting a qualified (preliminary) opinion from the Federal Patent Court on patent validity, (3) keep an eye on further decisions in the DABUS case (about whether an AI machine can be named an as inventor in a patent application) – including a possible UK Supreme Court judgment if they take the case, and (4) look out for further jurisdictional disputes in global FRAND litigation.

Megan Bannigan
Debevoise & Plimpton

In 2021, we saw a significant shift in the digital world, with both brands and consumers focusing on new digital offerings, such as the creation and purchase of non-fungible tokens (NFTs) and virtual fashion in the metaverse.  These trends will continue to expand in 2022, likely bringing with them a host of legal disputes. For instance, production company Miramax has already filed a high-profile copyright litigation against director Quentin Tarantino  following the announcement that he would auction off Pulp Fiction-related NFTs. The case raises the questions of who has the rights to mint and sell an NFT of any already existing work and is one to watch to see if it helps clarify some of these murky issues.

To help protect against infringement of IP rights in the metaverse, we’ve seen a host of brands – from Nike, to Allbirds, to cosmetics company Bobbi Brown – file applications for trademark registrations for goods and services in the metaverse. In addition to registrations, policing their brands will continue to be critical to prevent weakening or diluting their marks. And disputes like these also already exist. For instance, artist Mason Rothschild recently dropped 100 “MetaBirkins” NFTs – digital versions of the famed Hermès’ Birkin Bags – to raise awareness of “fur-free” and ethical alternative textiles. Hermès has denounced the project as infringing, but has not yet filed suit. This case – and others that will follow – will be sure to raise interesting and unresolved questions of First Amendment protection for expressive works, among other issues.

James De Vellis
Foley & Lardner

I would expect the unexpected in 2022.  The slate has been wiped clean over the last two years, and this is a new beginning.  New companies that rapidly build patent portfolios designed to achieve specific business objectives will seemingly come out of nowhere.  These companies will quickly attract venture capital, which is at or near record levels and achieve very high valuations.  These new companies could begin to either bypass – or get acquired by – more established industry players that are less nimble with their IP strategies.  It will be interesting to see if some early stage innovative companies and their maverick leaders will resist acquisition by yesterday’s companies and instead seek to disrupt and displace them, perhaps for ideological or generational-shift reasons.  Not to mention possible regulatory scrutiny related to such acquisitions.

It will also be interesting to see rates of innovation between North America, Europe, and Asia, as today’s patent filings are the seeds of tomorrow’s companies.  For example, who will have the lead in electric and autonomous vehicle innovation, in vaccine development and other pharmaceutical efforts, and in de-carbonization technology?  These are important spaces to watch as they will be early identifiers of the centers of gravity for tomorrow’s economy.

Efrat KasznikEfrat Kasznik
Foresight Valuation Group

My work as an IP valuation and litigation expert is usually a good compass as to what direction the market is going, and I am seeing three trends going into 2022.  One is the noticeable increase in leveraging IP assets for funding, either as a collateral for debt funding or as a valuation driver for equity funding; the assets being leveraged include patent portfolios only or entire IP portfolios.  While better valuation tools are still needed, the deals seem to be flowing at higher rates than ever before.  The Second trend we are seeing is the emergence of digital assets including data, NFTs, blockchain-based assets, and entire virtual worlds waiting to be explored.  Meta (previously Facebook) made the opening shot which brought the Metaverse into the main stream, and has given a new meaning to the term “intangible assets”.  Anyone not paying attention to this, will be left behind.  Finally, the third trend that I have seen accelerate over the past 5-10 years is the interaction of patent law and family law.  Divorce cases involving patents (and other types of IP) are a hot new area, where the issues are as complex as in any corporate litigation case.  We expect to see more of these cases come along as the family assets (like the corporate assets) are becoming more intangible.

Steve Kunin
Maier & Maier

I am looking forward with some trepidation to the Supreme Court’s decision in American Axle & Manufacturing Inc. v. Neapco Holdings LLC.  The issues before the Court are (1) What standard determines whether a patent claim is “directed to” a patent-ineligible concept under step 1 of the Supreme Court’s two-step framework for determining whether an invention is eligible for patenting under 35 U.S.C. § 101; and (2) whether patent eligibility (at each step of the Supreme Court’s two-step framework) is a question of law for the court based on the scope of the claims or a question of fact for the jury based on the state of art at the time of the patent. Optimists hope that the Supreme Court will reign in the damage caused by the Mayo and Alice decisions and provide greater clarity to the law of patent subject matter eligibility.  Pessimists are of the opinion that the Supreme Court is not likely to role back the clock to the 1980s when Diamond v. Diehr and Diamond v. Chakrabarty were decided.  If nothing else this is a major case to watch for in 2022.

Professor Daryl LimDaryl Lim
Center for Intellectual Property, Information and Privacy Law, University of Illinois Chicago School of Law

First, courts and governments in key jurisdictions will reveal their positions on AI, with most opting to keep the status quo or adapting AI to existing IP doctrines.

Second, the legislative and executive branches of government will weigh in on the weaponizing of antisuit injunctions. This may be an important first step to developing a code of conduct, perhaps within the context of plurilateral trade agreements.

Third, we will see the emergence of more truly international IP meetings. With virtual and hybrid events becoming the norm, the ease of both attending and speaking at such events allow more voices that have thus far been largely absent to participate and be heard. We have much to learn from each other. The humility, willingness, and now the ability to do so seamlessly, can only bode well for the inextricably interconnected IP issues we face.

Eli MazourEli Mazour
Harrity & Harrity

A major part of the USPTO Director’s official role is to be a principal advisor to the president on all IP policy matters.  However, the current administration requested comments on revising the 2019 Policy Statement on Remedies for Standards-Essential Patents before the new USPTO Director – as with the DOJ’s new head of antitrust – was even confirmed. This has continued a trend of ideologically driven decisions by the White House on IP issues. In 2022, I will be watching to see if this trend continues with regards to decisions on how the USPTO operates. Will the White House try to roll back former Director Andrei Iancu’s efforts to bring balance to the PTAB? Will the White House allow new USPTO Director Kathi Vidal – after she’s confirmed – to pursue meaningful efforts to fix the Section 101 mess she eloquently described during her confirmation hearings?

Scott McKeownScott McKeown
Ropes & Gray

The ITC is already a critically important venue for patent holders.  But, with the lack of U.S. production being recently highlighted by semiconductor and overall supply chain shortages, on-shoring of production may open up the ITC doors to a host of industries going forward. Moreover, as the PTAB moves away from deferring to district court trials dates that are rarely accurate, the ITC offers the best venue for patent assertion given the exclusionary relief and chance to shut-down the PTAB (should Fintiv practices continue).  As such, I expect the ITC to become increasingly prominent in IP disputes for 2022 and beyond.

Gene QuinnGene Quinn
IPWatchdog

In 2022, the big issues to keep an eye on will be related to the Patent Trial and Appeal Board (PTAB). At some point during Q1 2022, we can expect that Kathi Vidal will be confirmed as the next Director of the Patent and Trademark Office. During her Senate Confirmation hearing she was asked about the Office exercising discretion to refuse to institute inter partes review challenges, an issue that has brought the ire of Senator Patrick Leahy (D-VT), who says that was never the intention of the Leahy-Smith America Invents Act. The Supreme Court has confirmed that the Patent Office has the authority to exercise discretion to refuse IPRs, Leahy and others who ideologically favor implementers and believe “bad patents” are used to harass them in litigation disagree. Leahy has submitted the Restoring America Invents Act to, among other things, undercut discretion to refuse to institute IPRs. Regardless of whether Leahy gets this legislative victory, expect him and others within the administration who are philosophically aligned with implementers to pressure Vidal to not only significantly cut back on discretionary denials, but to also undo many of the other PTAB reforms introduced by Trump-era USPTO Director, Andrei Iancu. So far, what public statements Vidal has made, do not suggest that she will come into the Office with an intent to significantly disrupt the current trajectory of the Office, including the PTAB. As with all agency policy, however, that can change in an instant.

Robert ReadingRobert Reading
Clarivate

In the trademark space we see two interesting trends developing in 2022. Firstly, trademark filing activity has been setting records around the world each year since 2010 driven in particular by domestic growth in China and targeting of U.S. and European trademark registers by Chinese applicants. If Q4 2021 is any indication, this growth trend is likely to stop in 2022 with major trademark registers seeing a decrease in trademark filing activity for the first time in over a decade. On top of strong signs that Chinese domestic trademark filing volume is falling in recent months, the United States Patent & Trademark Office (USPTO) announced sanctions in December 2021 that cancelled over 15,000 US Trademark records filed from China, sending a strong signal that the USPTO is looking to protect the register against questionable high-volume filers. This will have a significant impact on confidence in China among sellers considering applying for a US trademark simply to provide smooth access to online retail platforms.

The second trend that we will be monitoring in 2022 relates to a virtual world. When Facebook announced a rebrand to Meta in October 2021, the world started to take notice of a version of a proposed version of an online universe called the metaverse. A place where online experiences are supercharged by virtual reality and interactivity, the metaverse has the potential to significantly change the way brands interact with consumers, and might also impact trademark law. Fashion and luxury brands are already filing trademark applications in Class 9 for virtual goods. Already the most crowded class on most registers, if the virtual counterpart of every physical item is going to be filed in Class 9 going forwards, authorities will need to rethink the Nice Classification system. There is also the possibility that new, 3-D interactive logos – such as those adopted recently by Meta and Block (formerly Square) will require more modern trademark types to be introduced as they currently do not neatly fit into the existing categories.

 

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