Posts Tagged: "IPR"

If the Eastern District of Virginia can dispatch patent cases in less time than the PTAB, why should we suffer the indignity of the lack of due process and constitutional infirmity of an Article II tribunal striping vested property rights without much, if any, real oversight by an independent judiciary?

Dutch tech conglomerate Koninklijke Philips NV is the owner of U.S. Patent No. 6,522,695. The Philips patent is challenged by Microsoft on behalf of several other tech giants… At the center of the proceedings is a challenge to the validity of a patent covering a technology that enables more information to be stored on an optical or magnetic recording medium… The official petition filed by Microsoft is the result of a series of seven lawsuits filed by Philips in December 2015 in which it attempted to assert the ‘695 against a series of tech developers. According to Microsoft’s IPR, the American tech firm has intervened in five of these cases, including suits against Acer and ASUSTEK, by filing as a counterclaim-defendant.

Patent system savvy corporations are ganging up on a smaller developer within the nascent automotive software industry who had the temerity to assert a patent covering a technology it developed in-house… The IPR challenges the validity of a patent owned by InfoGation Corporation, Inc., of San Diego, CA, a designer and developer of navigation software for the automotive industry, which was founded in 1996… The filing of the Google IPR is a direct consequence of Infogation filing suit against HTC, ZTE and Huawei last July, each of which alleged infringement of the ‘743 patent.

If Bill Hewlett and David Packard were just starting in their garage, they might be wise not to waste money acquiring them… An individual inventor, or SME, may defend patented inventions against unauthorized use – by everyone and anyone. However, it is disingenuous to say it is reasonable for them to do so, no matter what Congressional soundbites trumpet. The system is severely biased against these entities to the point of no longer serving them.

According to Bloomberg and AIPLA, the survey suggests that complaints from patent owners and other stakeholders in the U.S. patent system surrounding high patent invalidation rates at the Patent Trial and Appeal Board (PTAB) “have largely subsided,” arguing that patent owners find value in PTAB trials and that inter partes review (IPR) challenges are beneficial. Simply stated, the conclusions reached defy common sense, do not comport with the experience of patent owners, and the survey does not hold up to even cursory scrutiny… Those pointing to the prospect of a gold platted patent might as well be pointing to a pot of gold left by a Leprechaun at the end of a rainbow; gold plated patents and Leprechauns seem equally real based on the real life experiences of actual patent owners with the PTAB. Indeed, the PTAB is simply not a hospitable forum for patent owners, period.

In the piece, Lee tries her best to assure readers that positive developments have been made at the USPTO in recent years, but at multiple points she seems blind to major issues that have plagued U.S. patent system stakeholders during her tenure… Perhaps the most abrasive thing Lee stated in her editorial was this: “Our stakeholders share my belief, and that of my USPTO colleagues, that there is a cost to society when this agency issues a patent that should not issue…” No, Ms. Lee, a great many stakeholders do NOT share your belief. They don’t share your belief primarily because by making this statement you shine light on a largely fictitious problem while simultaneously ignoring the real problem facing the Office, which is that patent examiners refuse to issue any patents at all on good, high quality innovations that deserve patent protection.

Recently the Patent Trial and Appeal Board (Board) at the United States Patent and Trademark Office (USPTO) denied institution in two separate inter partes review (IPR) challenges. Both IPR petitions were filed by Blue Coat Systems, LLC, against Finjan, Inc. In both instances the Board found that the Blue Coat IPR petitions were harassing and denied institution… These two decisions could mark a turning point in the maturation of the Board. At least several patent owners, including Finjan, are routinely subject to serial, harassing IPR challenges. The Patent Office doing something about harassing IPR challenges is long overdue.

Activist Supreme Court decisions in the last decade have been principally responsible for these changes, stimulated by aggressive technology company incumbent lobbying. The combination of these decisions has had a far greater effect on the patent system and the economy than the Court originally intended. The U.S. is now in a compulsory licensing regime in which large technology incumbents that control at least 80% of collective market share employ an “efficient infringement” model of ignoring patents and forcing patent holders to enforce patent rights in the courts.

The American patent system represents a delicate balance. On the one hand, the patent system provides an incentive to invest in risky technical problem solving by giving an inventor an “exclusive right” for a limited time. On the other hand, from the time of the first Patent Act in 1790, patent critics have argued that patents block competition with a temporary monopoly. This tension has, nevertheless, enabled the rise of the U.S. as a major industrial economy, particularly after the Civil War. Optimally, the patent system encourages inventors to take risks to invent and disclose new and useful things by investing in ex ante costs before a later payoff. After a limited time of exclusivity rights, a patented invention falls into the public sphere, thereby providing a public interest in the long run. Economic and technological progress proceeds by building on previous inventions. Until about 2006, the U.S. patent system worked well, as evident in the development of the largest and strongest economy in the world.

The patent owner made a successful argument regarding secondary considerations, specifically relating to the success of the bottle cap in the country of Peru, which led in large part to PTAB upholding the validity of the ‘271 patent. A 7 percent increase in market share in that country during a five-year period after the new cap product was released to the Peruvian market led PTAB to find that the market share increase was attributable to the merits of the new product. The petitioner had argued that the use of Peruvian economic data was dismissable evidence but PTAB found that the evidence to support the petitioner’s view was lacking.

For the year patent infringement cases dropped by 22 percent from the previous year, from 5,823 cases in 2015 down to 4,520 cases in 2016. 2016 actually saw the lowest number of patent infringement lawsuits filed since 2011, when 3,578 cases were filed. There was no month during 2016 where more than 460 patent suits were filed; both 2014 and 2015 had at least one month where more than 650 patent suits were filed in district court.

In appealing from a final IPR decision, the appellant must have standing, based on evidence of record or supplemental evidence showing an “injury in fact.” Alleged economic injury must be specific and proven, and does not arise just from statutory appeal provisions or from IPR litigation estoppel when appellant’s infringement of the challenged patent is not a potential issue.

In a Per Curiam Order the Federal Circuit granted the petition for en banc rehearing and vacated the court’s three prior opinions in Wi-Fi One v. Broadcom Corp. The Federal Circuit will consider whether IPR institution decisions are reviewable in light of the Supreme Court’s decision in Cuozzo Speed Technologies v. Lee.

Pedersen doesn’t disagree that the patent system is biased against the patent owner in that “the patent owner has to run the gauntlet,” referring to needing to prevail in every forum 100% of the time. That means prevailing by convincing a patent examiner a patent should be awarded in the first place, prevailing against any post grant challenges, prevailing at the ITC and in the district court, and ultimately prevailing at the Federal Circuit. Pedersen acknowledged that with the system we have as a whole even if at ever step of the way there is a 90% chance that the patentee would win by the time you calculate the percent of “running the gauntlet” with the patent unscathed you are down to 50-50 at best.

In a December 22, 2016 decision, the Federal Circuit vacated a decision by the Patent Trial and Appeal Board (“The Board”) in two inter partes review (IPR) proceedings. The Court reversed the Board’s decision that the claims at issue were unpatentable for anticipation and obviousness… The broadest reasonable interpretation of a patent claim does not extend to a legally incorrect interpretation. When the claim as a whole expressly excludes a particular result, a claim term cannot be interpreted so broadly as to encompass that result.