Posts Tagged: "reexamination"

The United States Patent and Trademark Office (USPTO) is proposing rules of practice in patent cases to implement the supplemental examination provisions of the America Invents Act. The USPTO is also proposing to adjust the fee for filing a request for ex parte reexamination and to set a fee for petitions filed in ex parte and inter partes reexamination proceedings to more accurately reflect the cost of these processes. The USPTO published these proposed rules in the Federal Register on January 25, 2012.

The CAFC’s split panel decision this past week – In re Construction Equipment Company – extends the PTO’s authority to reexamine a patent even where its validity has already been adjudicated and confirmed by the courts. Yet the CAFC once again fails to explain how a PTO reexamination finding that a patent is invalid effects an earlier judicial determination that the same patent is valid and infringed.

Notwithstanding the inherent unreliability of legislative history and the truly scary prospect of trying to get inside the head of Members of Congress, it seems fairly clear to me that the America Invents Act, which was signed into law by President Obama on September 16, 2012, contains at least a handful of things that can only be characterized as unintended consequences. Among them are: (1) U.S. patents issued from foreign filings will be prior art as of the foreign filing date; (2) commonly owned patent applications cannot be used against each other for novelty purposes; and (3) the creation of an post grant challenge limbo because of the delay in initiating post-grant review procedures.

I have done quite a bit of writing about the America Invents Act, but I have been a bit derelict in providing the sequel to America Invents: A Simple Guide to Patent Reform, Part 1. Part of the reason, if not the entirety of the reason, is that the major parts of the American Invents Act that remain are anything but simple. On this note I embark upon Part 2, which will seek to make sense of prior user rights, post-grant review, preissuance submission and patentability changes. This will leave inter partes review, supplemental examination and derivation proceedings for the finale — Part 3.

Companies accused of patent infringement are increasingly looking at patent reexamination at the Patent Office as an attractive avenue for challenging the patent’s validity. Reexamination offers a number of well-known advantages as a forum for such validity challenges over District Court, among them the absence of a presumption of validity and a lower burden of proof. Less well-known, however, is the potential for reexamination to eliminate an accused infringer’s liability for past damages – even if the PTO confirms the validity of a patent in reexamination, the accused infringer might be entitled to “intervening rights,” effectively eliminating past damages, if the patent owner amends its claims to distinguish its invention over the prior art. This possibility of “intervening rights” received a big boost last week with the CAFC’s decision in Marine Polymer Techs. v. HemCon, finding that such rights may be created even without an amendment of the claims if the patent owner presents arguments in reexamination that “effectively amend” the claims.

I like writing about esoteric patent law topics and the question of “intervening rights” in reexaminations/reissues is one of the more esoteric. See my 1998 JPTOS article entitledIntervening Rights: A Potential Hidden Trap for Reexamined Patent. The case of Marine Polymer Technologies, Inc. v. HemCon, Inc. is one of those rare instances in this esoteric area of patent law where the Federal Circuit announced a new “wrinkle” on when “intervening rights” apply in reexamination. Unfortunately, the rule announced by the majority in Marine Polymer Technologies (“intervening rights” apply to unamended claims based on statements made during reexamination) is squarely in conflict with the express language of 35 U.S.C. § 307(b), as Judge Lourie’s dissent vigorously (and more importantly, correctly) points out.

The America Invents Act, which just recently passed by the Congress and sent to the White House for President Obama’s signature, is the most significant patent reform legislation in decades, and it promises to change virtually all of patent practice as we know it over the next 18 months. Some pieces of the legislation will go into effect almost immediately,…

The real sin is that reexamination could be a much better process. Those in Congress talk about alleviating the burden on the district courts by having a reexamination proceeding available, but they don’t seem to appreciate why it is that reexamination is under utilized. On top of that, patent reform circulating in Congress does absolutely nothing to revamp reexamination in a way that would streamline the process and make it more appealing. What patent reform does do, however, is add yet another procedure to bog down the Patent Office while not allowing the Patent Office to set fees and keep those fees they collect to do the work that is promised when they accept those fees. So if patent reform passes you can anticipate that the reexamination pendency numbers will get even more ugly, making the option even less appealing.

In view of Therasense, the Patent Office is proposing to revise the materiality standard for the duty to disclose information to the Office in patent applications and reexamination proceedings. It is the belief of the Patent Office that the Therasense standard will reduce the frequency with which applicants and practitioners are being charged with inequitable conduct, thereby reducing the incentive for applicants to submit marginally relevant information to the Office. Thus, the Therasense standard should curtail the practice of filing Information Disclosure Statements that refer to boxes full of prior art that is of marginal significance, allowing patent examiners to focus on that prior art that is most relevant. The USPTO adopting the Therasense standard could, as a result, lead to improved patent quality and even a streamlining of prosecution in at least some cases.

The vast number of America’s companies that need patents to prosper and grow should fear the post-grant provisions for challenging patents in H.R. 1249, the patent reform bill passed last month by the House of Representatives. In a system already plagued by delays in granting patents, they threaten to delay courts from enforcing patents once finally granted. This threat has received little attention, perhaps because advocates of the bill promise promptness that they cannot deliver.

Article One Partners is at it again, this time with four patents in the cross-hairs owned by the company suing Apple App Developers for patent infringement — Lodsys. Article One Partners has made a name for itself as the premiere crowd sourcing, prior art locating company in the world. Now they have three different studies aimed squarely at the four Lodsys patents, which were just used earlier this week to sue the New York Times and others, and earlier still against Best Buy, Adidas, CVS and others. Indeed, it seems that Lodsys is becoming quite a nuisance for defendants, which places them at or near the top of the patent troll most wanted.

In almost all cases, inter partes reexamination is better than ex parte reexamination, except of course where the requester wants to stay anonymous or the application from which the patent issued was filed before November 1999. The opportunity to reply to the patentee’s arguments and to address the specific concerns of the examiner is quite valuable. This is especially true where the examiner cites his or her own prior art. Issues commonly evolve over the course of reexamination, so that arguments in an ex parte request often are no longer persuasive by the end of the proceeding. I would add that some of the frequent users of reexamination, such as Apple and Google, almost always select inter partes reexamination when it is an option.

The focus of the litigation now shifts to the Patent Office. How Allen’s patent claims will fare in that forum is unknown, but certainly his odds of maximizing the monetary value of his patent portfolio are diminished. Reexamination has been ordered by the PTO for all four Allen patents, and in one (the ‘314 patent), a non-final rejection has issued. Had Allen chosen a different court and his cases not been stayed, his patents would still be in reexamination. Yet, his court trials would likely be completed before the reexaminations, with obvious advantages for him.

The United States Patent and Trademark Office (USPTO) is seeking public comment on a proposal to streamline the procedures governing ex parte and inter partes patent reexamination proceedings. The timing of this announcement, which appeared in the Federal Register on April 25, 2011, seems curious to me. With patent reform circulating in the House of Representatives does this signal a belief that on the part of the Patent Office that patent reform is dead? The patent reform passed by the Senate and that being considered by the House has revised post-grant review proceedings, so wouldn’t it be wise to wait to revamp reexamination until after patent reform passes, that is if it seems likely to pass?

Listening to those who code complain about patents is nearly hysterical. They still haven’t figured out that by and large they are not innovators, but rather merely translators. Perhaps that is why they so frequently think that whatever they could have come up with themselves is hardly worthy of being patented. Maybe they are correct, but that doesn’t mean that an appropriately engineered system isn’t patentable, it just means that those who code are not nearly as likely to come up with such a system in the first place because they rarely, if ever, seem to approach a project as an engineer would. Rather, they jump right in and start coding. In the engineering world that is a recipe for disaster, and probably explains why so much software that we pay so much money for today is hardly worthy of being called a beta, much less a finished product.