Posts Tagged: "post grant proceedings"

There is no blanket prohibition against the introduction of new evidence during an inter partes review proceeding, indeed new evidence should be expected. A petitioner can introduce new evidence following the petition, if it is a legitimate reply to evidence introduced by the patent owner, or if the new evidence is used to show the level of knowledge skilled artisans possess when reading the prior art references identified as grounds for obviousness.

Earlier today USPTO Director Andrei Iancu testified at an Oversight Hearing before the House Judiciary Committee. In addition to detailing forthcoming changes to post grant proceedings, Director Iancu fielded many questions on patent eligibility. “The issue is very significant. It is significant to the Office, to our applicants, and it is significant to the entire industry,” Iancu responded to Congressman Collins. “In some areas of technology, it is unclear what is patentable and what is not, and that can depress innovation in those particular areas. Our plan at the PTO is to work within Supreme Court jurisprudence to try and provide better guidelines. What we think is in and what we think is out, and provide, hopefully, forward looking guidance that helps examiners and the public understand what at least from the PTO’s point of view we think is right.”

On Wednesday, May 9th, Oklahoma-based patent owner Christy Inc. filed a class action complaint in the U.S. Court of Federal Claims against the United States seeking just compensation for the taking of the rights of inventors’ and patent owners’ patent property rights effectuated by the Patent Trial and Appeal Board (PTAB). Members of the proposed class would include all owners of patents which were deemed by the U.S. Patent and Trademark Office to include patentable subject matter which were later invalidated by the PTAB.

Earlier today the USPTO announced proposed rulemaking that would change the prior policy of using the Broadest Reasonable Interpretation (BRI) standard for construing unexpired and proposed amended patent claims in PTAB proceedings under the America Invents Act and instead use the Phillips claim construction standard.. The new standard proposed by the USPTO is the same as the standard applied in Article III federal courts and International Trade Commission (ITC) proceedings, a change critics of the PTAB process have urged for many years in order to bring uniformity to post grant challenges across forums… The USPTO is also proposing to amend the rules for PTAB trials to add that the USPTO will consider any prior claim construction determination concerning a term of the claim in a civil action, or an ITC proceeding, that is timely made of record in an Inter Partes Review (IPR), Post Grant Review (PGR), or Covered Business Method (CBM) proceeding.

What follows is a letter on the topic of PTAB reform that will be sent to USPTO Director Andrei Iancu on Monday, May 14, 2018. The letter seeks urgent action on the Patent Trial and Appeal Board in order to bring balance to a process that has tormented inventors for the last 6 years. We already have over 100 signatures from patent owners, patent attorneys, investors and inventors. If you would like to sign onto this letter please visit http://100patentowners.org.

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.

As in civil litigation, the petitioner in an inter partes review is master of its complaint and is “normally entitled to judgment on all of the claims it raises, not just those the decisionmaker might wish to address.” Therefore, the Board must decide the validity of every challenged claim when it agrees to institute inter partes review of any one challenged claim.

Often, a PTAB proceeding is threatened by an accused infringer to successfully settle the dispute with the patent owner. Often, no PTAB petition is ever filed. When the patent is asserted in two or more district court suits, often only one PTAB proceeding is filed. Many valuable and infringed patents are not asserted because of the threat of PTAB challenge. Everyone knows the extreme threat of a PTAB challenge and the costly, time-consuming, uphill battle to win faced by the patent owner.

Imagine this: you become aware of a patent that might cover your products, so you reach out to the patentee to secure a license agreement. After negotiating and entering the agreement, you later decide you’d like to pay less or no royalties. So you threaten to file some IPR and PGR petitions, and when that fails to secure more favorable terms, you breach the contract. If you find yourself sued for patent infringement you protest to the court that as the agent of public interest, you must be allowed to simultaneously challenge the validity of the patents not only before that court, but also before the PTAB. On the same grounds. At the same time. This is what at least one licensee is trying, and the Federal Circuit may soon provide guidance on the viability of this double-adjudication-for-the-public-good-tactic.

The Federal Circuit found that the Board failed to provide sufficient explanation for its obviousness finding, instead using a conclusory approach that asked whether the missing limitation resulted from “ordinary creativity” of a skilled artisan. According to the panel majority, the question of whether the claims resulted from ordinary creativity was akin to asking whether the claims were obvious as a result of common sense. Therefore, the Federal Circuit began by returning to it’s 2016 ruling in Arendi S.A.R.L. v. Apple Inc., 832 F.3d 1355 (Fed. Cir. 2016), which dealt with the proper use of common sense as part of an obviousness rejection.

The Federal Circuit issued an Order staying further proceedings at the PTAB relating to the RESTASIS patents now owned by the Saint Regis Mohawk Tribe. The stay will remain in place until at least one day after the oral argument scheduled for June 2018. The Court will consider whether the stay shall remain in effect or be lifted based on the merits of the case.

If this practice of phantom expanded panels, with APJs not identified on the record or to the parties, is legal then IPR panel assignments are nothing more than a farce. Any APJ, including Chief Administrative Patent Judge Ruschke, can actively participate in the deliberative process of any IPR without ever disclosing that fact to the public or to the parties. So, in effect, all IPR panels may be secretly stacked!

Competitors like Mylan and Teva, rather than inventing better treatments or cures for dry eyes chose the shortcut. They attacked Allergan’s patent in the PTAB. Allergan responded by assigning their patent to the Saint Regis Mohawk Tribe who in turn invoked sovereign immunity at the PTAB, and demanded their rights in a real court with a real judge and jury. Mylan, Teva, the PTAB, Congress, and class action lawyers have formed a mob to gang up on Allergan for defending their intellectual property rights. They filed hundreds of suits accusing Allergan and the Tribe of fraud, conspiracy, and sham transactions stemming from an “invalid” patent. The attackers are mistakenly focusing on the patent as the problem. The problem is not the patent, but rather all of the incentives that reward copying instead of innovating.

The USPTO has provided us with a comment from Chief Judge David Ruschke, who defends APJs of the PTAB as having extensive legal and technical experience. The problem is this view is simply not consistent with the data. While APJs may be technically competent, there is little doubt many on the PTAB were appointed when they simply did not have extensive legal experience… PTAB judges preside over administrative trials, which have all the trappings of litigation (i.e., motions to dismiss, discovery, discovery disputes, hearings, testimony, depositions, constitutional rulings, jurisdictional matters, questions of contract interpretation and privity, and much, much more. No matter how much Ruschke and others do not want to acknowledge the truth, it is perfectly accurate to say that patent agents and patent examiners have absolutely no experience in that world. They simply can’t, unless they are engaging in the unauthorized practice of law.

On February 22, 2018, the U.S. Court of Appeals for the Federal Circuit issued a non-precedential decision in Google, LLC v. At Home Bondholders’ Liquidating Trust (2016-2727, 2016-2729). In its decision, the Federal Circuit affirmed two inter partes review (IPR) decisions and found for Google’s opponent, At Home Bondholders’ Liquidating Trust… The patents at issue were U.S. Patent No. 6,286,045 and U.S. Patent No. 6,014,698, both of which deal with technology involving caching Internet advertising banners locally at a device for quicker loading of a webpage the second time the page is requested.