Exclusive Interview with Steve Kunin, Part 2

Steve Kunin

On May 6, 2013, I sat down with Steve Kunin and we discussed a wide range of patent issues. In Part 1 of the interview we discussed the new post grant procedures for challenging issued patents, and started discussing the estoppel provisions. In Part 2 we conclude our discussion of estoppel and move into discussing secret prior art, the Economic Espionage Act, the algorithm line of cases from the Federal Circuit and the erosion of patent rights that started with eBay v. MercExchange.

QUINN: With respect to post grant procedures, a lot of the same kind of issues that applicants have always had to deal are being raised as concerns in light of the estoppel. It doesn’t matter whether or not prior art was findable in any intellectually honest way, the question is rather issue it is findable after you spent three or four, five million dollars to locate the one copy of the thesis in the library. I’ve always been troubled by that being prior art because how is an applicant going to know that? I mean maybe the applicant would but the one single thesis has always struck me as unfair, so now that fairness issue almost seems like it’s going the other way. What it seems to me is in patent law the more laws we get, the more complicated it gets, and it’s harder to see how the entire law fits together in a cohesive way.

KUNIN: The problem with respect to simplicity as compared to fairness is that so long as the exceptions don’t overtake the rule the law needs to apply both consistently and fairly. A rule of reason applies. Congress is forced to compromise when enacting any law because we have a process where there are many constituent groups advocating for their particular desired outcome and Congress in its wisdom fashions the law to try to strike a balance among these different views of what the law should be. The existing copyright laws are a representative example of the results of such a dynamic.


QUINN: Or the tax code, which is probably the most extreme example. But it’s funny that you bring that up. I don’t want to go too far down that path but now they’re talking about comprehensive rewrite of the copyright laws. When I saw my wheels started turning. Then last night we’re having dinner, my wife and I, at a local restaurant where there was a radio playing. Then I started thinking that what qualifies as a home entertainment system, which you can use in such a facility, has evolved greatly as technology has evolved. And you know somebody comes to you with these questions — can I do this? And the answer is I don’t really know. I mean we have these guidelines but they never really seem to fit what the person is trying to do. So there’s a lot fewer answers in copyright law and I wonder to some extent whether we’re moving that way in patent law, where there’s these general principles but will they really address enough certainty for the business world.

KUNIN: We have a dichotomy between patent law which is principally an absolute liability law that provides the strongest form of intellectual property protection and copyright law that provides a weaker form of protection. In intellectual property laws we have a continual tension between public access and owner’s exclusive rights. We see this balance of interests play out differently as we go from the strongest form of protection namely patents to one of the weaker forms of protection namely copyrights. For example, we have statutory fair use provision in copyrights which based on some recent cases seems to be becoming more liberalized. Previously some transformative impact such as, parity, satire, social commentary, criticism and the like was required come within section 117 for use exception. It appears that the principle of fair use in copyrights is expanding. We don’t have as many exceptions in patent law but as you point out, Gene, it’s interesting what’s happening now with respect to the interest and trend for strengthening of protection in the trade secret area. Under the AIA, for example the prior user right being expanded. We also see the debate with respect to the new section 102 and whether Metallizing Engineering gets overruled, and whether confidential offers for sale do not qualify as prior art. Congress now is looking to expand the Economic Espionage Act to provide a basis for civil actions an appetite by Congress for expansion of trade secret protection.

QUINN: Where does that stand, do you know? I mean I know there was a Congressman who asked the Patent office to do a study about whether or not economically important innovations should be patented, which on its face sounds funny to actually say out loud. I guess the thinking was that if we’re giving it out there then we’re giving countries like China or whoever the ability to see that and steal it from us. I haven’t heard where that went. Are we still waiting for a Patent Office report, do you know?

KUNIN: I don’t see that initiative becoming law in the U.S. Eighteen month publication of all applications not subject to secrecy order or abandoned prior to publication is the international norm. I see continued efforts to eliminate non-publication requests rather than going in the opposite direction. –

QUINN: But it’s scary that it was even brought up.

KUNIN: It shows you what kind of tension we have in the public policy making arena because on the one hand you have many groups particularly large entities who want a pure harmonization of patent laws world-wide. Which means absolute 18 month publication of all applications other than ones subject to national security or having been withdrawn prior to publication. In the interest of quality examination and to assess the validly of patents you need 18 month publication as an international standard. The flip side is the concern by some that having these published applications available anywhere in the world to the world will benefit from the disclosure of the applicant’s technology irrespective of the fact that the patent may not issue for on average three years after it was filed in the United States or perhaps never. Of course, if you seek prioritized examination the patent may issue within one year. The fear is that 18 month publication provides a form of technology transfer without any assurance of exclusive rights.

QUINN: Right, the only guarantee is that your competitors will see it before you get a patent unless you go accelerated which doesn’t seem like many people are doing.

KUNIN: Well, I don’t think we’re going to see the limit of the 10,000 prioritized examination requests in any fiscal year be exceeded any time soon.


KUNIN: Many applicants don’t need quick patents. It’s also a premium price to pay to get expedited processing without a complete understanding of the commercial value of the underlying technology.

QUINN: Yeah, it is in a way but I look at it as not being that way. The way I see it is that if you’re willing to pay the $2400 for a small entity plus a few hundred dollars to put together the paperwork in order to accelerate. you’re going to get an answer. Now they average six months to a patent decision. So that means some of them are a lot faster. You’re going to get your patent quick, you’re not going to have a prolonged prosecution. You’re not going to have to pay for your attorney or the examiner to come up to speed every time they touch the file because they’ve been touching it just a few weeks ago. And I think it cuts down the number of back and forths you have with the Office, so in the long run it’s cheaper. For years clients would say, “oh, I can’t wait that long to get a patent, I need it right away.” And now they have a mechanism to get it right away and and they’re not using it. So it almost seems like the Patent Office said okay, we’re going to give you what you say you want now nobody apparently wants it.

KUNIN: To some degree that’s a bit of an unfair statement because if you go back to the old petition makes special practice and study the percent utilization rate, you will see that only .5 to 1.5 percent of all applicants sought accelerated examination. This was true even before applicants were required to file the onerous accelerated examination support document.

QUINN: Yes, I know you’re right, but the few of petitions we in our firm did – we never really saw it move any faster. And in actually in one case it moved way, way slower. After the petition to make special was granted based on the inventor’s age they lost the file, so it got derailed. So it took this guy longer to get a patent. It probably took him twice as long.

KUNIN: Let’s just change the dynamic a bit.

QUINN: Okay.

KUNIN: The PTO many years ago proposed a multi-track examination program.

QUINN: Which I thought was great.

KUNIN: The PTO is still considering a deferred examination option because many applicants don’t need to get their patents quickly in some fields of technology, such as the life sciences. Moreover, some applicants would rather earn a patent term adjustment to extend the life of their patents due to PTO administrative delays.

QUINN: Yes. That is very beneficial to the patentee in a lot of areas.

KUNIN: Correct. But, also, I think statistically speaking apart from what people classify as high-tech there are many fields of technology where it takes five or eight years after the innovation takes place for there to be a commercially marketable aspect of the technology. So I think there are many mature technologies where for many good business reasons it’s not really necessary to get a patent quickly.

QUINN: Right. I know, and I understand that, I do. It makes all the sense in the world when you stop and think about it. But if you look at the statistics the Patent Office puts out,  on their dashboard,  if you have to go to appeal it’s over 87 months. I think that starts to get excessive. I know the Office says they are bending the curve finally, which is good. And I do think a lot of really good things are happening over at the Patent Office. But the erosion of patent rights is something that really does worry me, and I think if we had to put our finger on it when did it start I think it started in a big way, maybe it started before this, but the eBay v MercExchange case was a big bending of the patent curve towards the system being less of a property right regime and that has in my opinion accelerated. Then I look at our Supreme Court, which currently doesn’t want to have any kind of bright line rules, instead they want everything done on a case by case basis. I don’t know how you do that with 7800 patent examiners, many of whom didn’t go to law school, on the front lines applying their own judgment. It worries me that patents are eroding in power and that’s one of the reasons my ears perk up when I start to hear some say they would like to be able to serially challenge patents in post grant proceedings. It seems to me the clear way that things are moving a trade secrets may become more valuable. If that happens I think that would be the first time in our history that would the case. Do you have any thoughts on any of that?

KUNIN: I agree with you that the eBay v MercExchange case was an important landmark decision where we saw sea change in the law of the ability to obtain injunctions in patent cases., I think we have seen not only decisions from the Supreme Court but from the Federal Circuit as well where we have seen a trend making it more difficult to obtain patents and remedies in enforcement proceedings. We can see what’s happened recently to the patent laws in the subject matter eligibility area, on the enhanced written description requirement for claims to a genus, scope of enablement, and the KSR case applying a more subjective standard for establishing obviousness making it more difficult for patent applicants and owners.

QUINN: And that brings us back to what we were just talking about — the political sentiment in Congress about giving this stuff away to early. We are giving it away at times when no patent will issue, and – and the system seems to be working the way it was designed at least particularly in that area. But these things all seem to tie together because the more of these decisions that we get now in the software space the less settled things become. For example, the algorithm cases discuss using means plus function claims. If you use means plus function claiming you have to have 100% of every algorithm. Well, that’s great! Now a lot of people say we’re not going to use means plus function claims. But then you have Professor Mark Lemley and others saying, well, that the 100% disclosure test makes so much sense that it should not only apply when using means plus function claims, but it should be applied across the board. I can easily envision a day when a Court would say, hey, that makes a lot of sense and apply that across the board. So the law moves yet again, which strikes me as fundamentally unfair. As you know, some of the software and business method stuff that people filed five years ago, certainly most of what was filed ten years ago, won’t pass muster and you would never write that way today.  Yet the applications written then were good based on the law then and now the law today is being applied to review it or challenge it.

>>>> Click to continue reading interview <<<<

PREVIEW: In the final segment of my interview with Steve Kunin we discuss the ever growing complexity of patent law, how over the last 200+ years the pendulum swings back and forth between the law being pro-patentee and anti-patentee, whether the patent system is really broken, the joinder provisions of the AIA. We then move on to some fun questions, talking briefly about the Washington Nationals, St. Louis Cardinals and summer Sci-Fi movies.


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One comment so far.

  • [Avatar for Running Fred]
    Running Fred
    May 30, 2013 09:24 am

    Excellent article/interview, Gene! Thanks for writing it up. I am impressed also by Mr. Kunin’s thoughtfulness about these issues.

    Re your last comment (about the law changing after patent applications have been drafted but before they are issued/prosecuted), this already happened in a big way with sequence applications and then more generally in the biotech area over the past 10-15 years or so. And examiners have really latched onto written disclosure as a way to reject. It’s had a huge impact, even before the Myriad and Prometheus issues. I agree that it seems fundamentally unfair, but I’m not sure how it could be fixed.

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