Kip Werking

Since U.S. Patent and Trademark Office (USPTO) Director Andrei Iancu took office, I have observed, with admiration, how he has taken bold action to improve perceived problems in the patent system. The Director’s bold action has also caught the attention of members of the Supreme Court. Justice Gorsuch, joined by Chief Justice Roberts, observed, “[n]or has the Director proven bashful about asserting these statutory powers to secure the [policy judgments] he seeks.”
Oil States Energy v. Greene’s Energy Group, 138 S.Ct. 1365, 1381 (2018) (Gorsuch, J., dissenting).

I wonder, however, whether the law now permits Director Iancu to do something even bolder: create rules interpreting Section 101, at least within the limited context of the America Invents Act’s (AIA’s) post-grant review trials, such that courts may defer to the Director’s interpretation under Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984).

The Supreme Court’s own precedents provide overwhelming authority for interpreting § 101 broadly and, conversely, interpreting its judicial exceptions to § 101 narrowly. These precedents provide ample support for the Cluster Argument: (1) observing that the term “abstract idea” constitutes a legal term of art that, according to stare decisis, properly refers to looped mathematical algorithms and old and fundamental business practices and (2) declining to expand the set of “abstract ideas” beyond these two clusters without a signal from Congress.

What’s stunning about this list is that almost nobody talks about reforming patent law to correct these biases! In general, the only biases that are socially and politically acceptable to correct are biases in favor of patent owners. It is profoundly unfair to correct biases in the patent system to protect accused infringers if we do not also correct biases in the patent system to protect inventors. It is interesting to ask why modern patent reform overwhelmingly protects accused infringers without also protecting inventors. I worry that the patent reform asymmetry fits within a larger trend of decline in the great Western traditions of innovation, due process, meritocratic competition in the race to invent, reliance on property rights and business investments, and strong support for intellectual property as distinct from real and personal property.

The Board of Patent Appeals and Interferences did something fascinating in Ex Parte Yudoovsky. The Board sua sponte declined to consider an unauthorized new ground of rejection—even though the appellant never filed a petition. In other words, the Board refused to consider a new ground of rejection, because the Examiner failed to designate the ground as “new.”