The PTAB institutes 69% of petitions and cancels claims in 82.5% of final decisions. Given many patents experience multiple petitions, the net result is two thirds of patents are invalidated by the PTAB. While close to a third of patent holders subjected to PTAB settle, these settlements are made under the PTAB storm clouds of extremely high invalidation rates and are settled under terms unfavorable to the patent holder.
Post Grant Review (“PGR”) trends are indistinguishable. Since the only patents eligible for PGR were examined completely under enhanced examination created in the America Invents Act, that means patents examined under First-to-File, Enhanced Patent Quality Initiative, and current case law still do not pass PTAB muster. The problem is not examination; it is PTAB procedures.
U.S. Patent grants fell significantly from 2014 to 2015 while China’s filings skyrocketed. “China’s patent office received by far the most filings, clocking nearly one million of them outstripping the combined total of patents filed in runner-up countries the United States and Japan …” U.S. share of global venture capital has fallen dramatically. China increased its venture capital investment by 223%. This dramatic swing in venture capital, patent filings, and startups from the U.S. to China maps its time line directly to the creation of the PTAB, which also coincides with China’s efforts to establish an innovator friendly patent system. China has seen the opportunity of America’s patent system becoming a hostile for inventors, startups and venture capital, and is seizing the moment.
The PTAB is truly a crisis that is driving venture capital, startups and job creation to China. If the PTAB is allowed to remain the death squad that it currently is, we will be buying our next generation of high tech software and hardware critical to our infrastructure and military from China. We teetering on the doorstep of a national security disaster.
We recommend two stages to the reform.
Stage 1 – Damage Control
- Suspend all PTAB proceedings immediately. This can be accomplished by the USPTO invoking §316(a)(11) and §326(a)(11) to extend all pending proceedings by 6 months, which will allow time necessary for the government to implement procedural reforms to stabilize the system.
- As long as the USPTO provides refunds to unsuccessful petitioners and also allows unsuccessful petitioners to continue to file as many subsequent petitions as they like, there will be no harm created by the Office denying institution of all petitions for which an institution decision is due in the next 6 months.
Under the current PTAB system, irreparable harm is occurring to patent holders. Conversely, virtually no harm will be done to petitioners by putting on the brakes. Charging ahead in light of the conflict between examination and post grant review will only continue to damage patent holders. The probability of substantial error is extremely high under the circumstances. Improperly cancelled claims will be very difficult to correct, but delaying adjudication by a few months carries no risk.
Stage 2 – Restore Balance and Due Process
PTAB institution decisions are biased in favor of institution regardless of the merits.
- The decision to institute a PTAB proceeding must be performed by an objective panel, which includes members unassociated with the PTAB. The decision to institute PTAB review cannot be made by the same PTAB judges who conduct the trial. The current system encourages institution because PTAB judges must review a sufficient number of patents to remain employed (i.e., satisfy their production quota). This also biases the decision to invalidate the patent because it is not likely for a person to institute a PTAB review by declaring the patent is more likely than not to be invalid, to then find the patent valid. This is a well-known psychological bias called “anchoring.”
- Petition fees must not be refunded to the petitioner if the petition is denied. Refunding petition fees biases the decision to institute a PTAB review because it is well known that the PTAB is financially insolvent. This point is well illustrated by the USPTO’s current attempt to raise fees due to PTAB consuming resources from examination and maintenance. If PTAB judges want to keep their job, they must institute as many PTAB reviews as possible so that fees already paid do not get returned to petitioners.
- Establish a code of conduct for PTAB judges similar to Article III courts. PTAB judges apparently have no code of conduct barring PTAB judges who have previously represented a party to decide institution and decide issues of validity. At least two PTAB judges have done just that. A code of conduct similar to that of Article III judges must be put in place.
“A patent shall be presumed valid.” PTAB must draw all inferences in favor of preserving the patent.
- For institution, PTAB must require identification of a substantial new question of patentability. If the prior art of the petition is cumulative to or the same as the art considered in examination then the petition must demonstrate a clear error in the examination. Absent a clear error, challenges must give deference to the original determination of patentability by the examiner and deny the petition.
- Apply the Phillips standard of claim construction as used in Article III courts. Applying BRI (“broadest reasonable interpretation”), as is now the case, to an issued patent is incorrect and harmful because that is same standard used during examination. Inspection prior to issuance necessarily must be stricter than inspection after issuance. This is a basic premise of quality control (6 sigma, TQM, lean, etc.). If the original examination is not done to a tighter standard than what is desired for the final product, then the final product is doomed to a high failure rate.
- Apply the insolubly ambiguous/not amenable to construction standard for indefiniteness. Language is inherently subjective and ambiguous.  If the claims pass muster with the examiner, and the examiner did not make a clear error, the claims must be allowed to stand. If the claims are amenable to construction, the claims are good enough.
- Limit petitioners to a single petition per patent. Filing multiple petitions is a way of circumventing word limits imposed on petitioners when filing against the same patent. This practice significantly increases the cost of defending against a PTAB review and pushes that increased cost on the party least able to afford it. Petitioners must narrow their arguments to their best grounds in a single petition.
- Deny seemingly organized petitions by multiple parties, whether filed simultaneously in concert or filed serially. The patent owner must be protected from multiple petitions which drive up the cost and difficulty of mounting a successful defense. The board must facilitate consolidating all interests in challenging the validity of a single patent into a single petition.
- Allow live testimony and broad discovery similar to Federal Rules of Civil Procedure to aid in identification of the real parties of interest; and to allow patent owners to put on comprehensive evidence of objective indicia of non-obviousness, which assists the Board in correcting for hindsight bias.
- Claims not invalidated must be validated. PTAB reviews only invalidate claims selected, instituted for review and then actually reviewed. The PTAB makes no comment on the remaining claims. This means that the remaining claims are neither valid nor invalid leaving the patent open to further PTAB reviews. A patent must become PTAB proof after a PTAB review or it will be serially attacked by multiple parties and will always be presumed invalid.
- Implement industry standard quality systems. The USPTO is now a closed loop system in which on one side of the USPTO creates a product and the other side destroys the product. With this incredible power, providing a publicly accepted standardized process control system is paramount to establishing credibility for the USPTO. Many industry standard organizations provide standardized quality programs for the type of processes and interactions present within the USPTO. (6 sigma, TQM, lean, ISO, etc.) The USPTO must identify and implement an industry standard quality control system and report publicly on its results.
PTAB reporting must be based on metrics accepted by industry as meaningful and accurate.
- Report on patents, not claims. Claims subjected to a PTAB review are selected by the petitioner, who is most often a defendant in a patent infringement case in Federal Court, or an agent of the defendant in order to mask the true identity of the real petitioner. This means that the claims selected for review are the most critical to the case of infringement. Invalidating just one of these claims often renders the patent unenforceable against the petitioner and therefore destroys the patent. Seldom are all of a patent’s claims challenged and as such, seldom are all the claims invalidated. For example, a patent may have 20 claims, but only 10 claims are challenged to a PTAB review and the PTAB may only invalidate a subset of those 10 claims. Reporting by claim gives the appearance that the PTAB does not invalidate too many claims, however for all practical purposes the patent may be unenforceable and thus effectively invalidated. Therefore reporting based on claims invalidated gives the appearance of minimal damage, when the damage is actually severe.
- Institution and invalidation rates must be calculated per patent when the patent is subjected to multiple PTAB reviews. For example, multiple petitions are often made against the same patent and only one is instituted. In those cases, the reviews that are not instituted are rolled up in reporting as not instituted and only the instituted review is rolled up as instituted. So, following the example, if five reviews are petitioned, four are denied and one is instituted, the PTO reports a 20% institution rate. However, the patent actually has a 100% institution rate. So, again, institution rates as currently reported by the PTO minimize damage, when in fact damage is quite severe.
- Disputes settled during the pendency of a PTAB review must be considered a favorable outcome for the petitioner. Any settlement during the pendency of a PTAB review is made under terms favorable to the petitioner and not favorable to the patent holder. For the patent holder, settlements avoid the incredibly high risk that at least one claim will be invalidated thus fatally damaging the patent. A settlement is not a success for the patent holder and it is not neutral. It is a win for the petitioner.
If patents are not reliable, patents cannot secure investment and risk-taking necessary to startup up companies with technologies that can only be protected by patents. An unreliable patent system therefore cannot promote progress in the useful arts and science as required by the U.S. Constitution. It cannot create new jobs nor can it propel economic growth. Therefore an unreliable patent system is a failed patent system.
Current PTAB processes are laying waste to investment in patents and early-stage startups which is undermining confidence in the patent system overall. We must immediately improve the U.S. patent system by temporarily freezing PTAB operations until a review can be completed and recommendations put in place.
 “The results from the Patent Trial and Appeal Board reflect the procedures it applies, and in my judgment the procedures are wildly off base. If I had a magic wand I’d make the procedures comply with those from federal court…Unless you change the PTAB process hook, line and sinker this is what you are going to get… it isn’t that the PTAB is hostile to patents, it is that their processes can’t accomplish anything else.” Retired Chief Judge Paul Michel in remarks at the IIPCC Symposium May 8, 2017
 U.S. Patent and Trademark Office, “2015 Performance and Accountability Report,” November 13, 2015
 Agence France-Presse, “China Leads in Patent Application Growth,” December 14, 2015
 National Venture Capital Association, “The State of Venture Capital & The Entrepreneurial Ecosystem,” January 2016
 EY, “Global VC Investment Landscape,” January 2015
 35 U.S. Code § 282 – Presumption of validity; “A patent shall be presumed valid. Each claim of a patent (whether in independent, dependent, or multiple dependent form) shall be presumed valid independently of the validity of other claims; dependent or multiple dependent claims shall be presumed valid even though dependent upon an invalid claim. The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity.”
 “a court need not attempt the impossible task of resolving all questions of meaning with absolute, univocal finality. Such an endeavor could proceed ad infinitum, as every word—whether a claim term itself, or the words a court uses to construe a claim term—is susceptible to further definition, elucidation, and explanation. We have therefore often observed that “a sound claim construction need not always purge every shred of ambiguity.” Acumed LLC v. Stryker Corp., 483 F.3d 800, 806 (Fed. Cir. 2007)
 “we protect the inventive contribution of patentees, even when the drafting of their patents has been less than ideal… As is often the case when problems in document drafting lead to litigation, the ideal of precision was not achieved here, and we are left to deal with an imperfect product. While we agree with the trial court that the product was less than perfect, we disagree that the flaws were fatal.” (Exxon Research & Eng’g, 265 F.3d)
Join the Discussion
23 comments so far.
Eric BerendJune 7, 2017 07:32 am
Hmmm… the coward will post comments from ‘IPdude’, ‘Night Writer’ and ‘anon’, but not me.
Is his self-serving censorship based upon snobbery towards non-attorneys and academia, or cowardice towards opinions of genuine inventors? Either way, it seems there, inventors are not considered to ever be ‘patent practitioners’; which is, of course, false: sometimes hardship or excessive expenses leave an inventor with little other choice, despite a preference for professional practice.
The Time Is Now To ActMay 25, 2017 08:40 pm
Eric @ 11 – I mean, WOW. I hear you on that level.
At a recent industry executive symposium, I had to force myself not to stand up and interrupt the panel. It is an an up welling we all feel in general and the tech blogs of the early 2000s foretold this would happen if we mucked with the guts of our great patent system.
As far as counsel, God bless the ones that care; really. In IP, it is many more than 1 attorney.
The lobbyists are being paid by *another dept* inside these the big caps (Thanks SV gang et al). Quit going to TED and giving talks on making society ‘accessible to all’ while you a) fund efforts to funnel all benefits of IP to you and b) fire hose massive volumes of applications at the patent office.
Honestly, for their part, IP counsel, lit and prosecution, generally have so much to do anyway just keeping the department executing on task; waiting no doubt to escape into retirement or for the opportunity to help a startup.
My hope is that many of those great attorneys running the IP departments start demanding their executive branch stop seeing outside innovation as BAD and thinking the best place for great innovators is on their W2. Heck, even some of my best, I’ve gladly shook hands with when they moved on to start their own deal, because I too took that leap and had an exec wish me well.
What makes a great inventor/entrepreneur is they take a strong side of the issue. so thanks for doing it.
Maybe next time I will buck up, stand up and unload on the purveyors of the JOKE rhetoric. And, its not just the attorneys spreading misinformation.
On more than several occasions and upon listening to more ‘Freedom to Operate’ BS, I’ve sternly reminded colleagues we can’t have it both ways in the innovation economy. Either everyone gets a chance to win, big and small, or we will all eventually fall along with the system.
AnonMay 25, 2017 04:34 pm
I try to stay out of the weeds of such cross-sovereign attempted comparisons.
I find that such often do not provide any actual clarity to the topic at hand (read again my post at 19 as I already reflect on the notion of “influence”).
Edward HellerMay 25, 2017 03:29 pm
anon, recall the discussions we had with MaxDrei about the new patent court system in Europe. All recognized that such new courts, in competition with each other for business, would tend to favor patent holders because patent holders would had the right to choose.
Now consider who has the right to choose in connection with IPRs?
AnonMay 25, 2017 03:26 pm
Sorry Mr. Heller,
I would like more than any anecdotal comments by “members of the PTAB itself.”
Now mind you, any [ sic 😉 ] such statements may be useful – if they can be properly corroborated. And certainly, the view of the actual historical money flows could provide some of that corroboration.
And perhaps more interesting, a FOIA request for any internal management memos directing judges as to “expectations” or “requirements” in the way of quotas may also provide corroboration.
Edward HellerMay 25, 2017 03:21 pm
Anon, from statements of members of the PTAB itself, it is abundantly clear that they know that their jobs depend upon granting petitions and finding in favor of petitioners.
AnonMay 25, 2017 03:19 pm
It is not a matter of being picky – it is a matter of being correct, and then in that correct view, being able to ask the better questions (for example, FOIA requests might be in order to see just how the internal funds not only are being transferred around, but (perhaps) more importantly, just what were the budgetary assumptions that folded into the complete picture, how has the Office been doing against that initial projected picture, and (for example) being able to ascertain whether or not a Director’s please for increased fee levels is indeed kosher.
Remember – the fee setting authority was not unlimited, but were constrained to be a “net-zero” effect within the Office. This has a clear takeaway that if fees (under any given budget) are being sought to be increased, then somewhere, somehow, and to some very specific degree, other fees need to be reduced.
As to your offer of the Tax Court, you seem to want to imply that the Office funding the post grant mechanisms is somehow a new concept.
It is not. I think trying to portray a known mechanism as some type of “a-ha” is self-defeating or at the least, takes away from a more critical evaluation.
Now what might be new – and certainly might be interesting – would be a time series of views of the internal Office expenditures. For example, has the Office – without telling anyone or without any guidance as to sticking to any approved budgetary amounts – switched internal assets more to the PTAB and away from, say, examination in the first instance?
Edward HellerMay 25, 2017 02:41 pm
Anon – picky picky.
Imagine that the Tax Court was funded not by the general revenues but by the taxes collected from rulings in favor of the IRS.
AnonMay 25, 2017 02:30 pm
The PTAB is not fully funded by the post grant petition fees.
Where would you get such an idea? The Patent Office – as a whole – and its funding paradigm is extremely well known.
The details of the actual books and whether or not the augmented authority provided to the Office on fee setting in the AIA is all in proper control – now that may be a completely different story.
Edward HellerMay 25, 2017 02:08 pm
May I suggest that the most important observation by the opening post is the institutional bias in favor of granting petitions, and then in deciding in favor of petitioners in order to fund the PTAB, who are wholly funded by petition fees.
If we cannot get rid of the PTAB, and in order to assure as much independence as possible, we ought to fund the PTAB wholly out of government resources, make the PTAB completely independent of political authority – make them part of the court system and under court supervision, and have their work routinely appealable to a district court as are the work of magistrates today.
Eric BerendMay 25, 2017 01:49 pm
@ 11., ‘Anon’:
Thank you, very much. I would not ask such an apology of you, who has expressed a great deal of respect and knowledgeable expertise on the original U.S. Constitutional establishment and as modified by U.S. jurisprudence over its history.
That you proffer it, is commendable; and, those on whose behalf you apologize, do not deserve your gracious gesture; even as they trundle on, oblivious.
I wish there were 20,000 more of attorneys in the U.S. with your sensibilities and apparent intellectual integrity about the issue; then, there might just be enough force on this side, to counter-balance the interests mendaciously and recently influencing the domain to its present fractious, anti-inventor state.
AnonMay 25, 2017 10:46 am
On behalf of the rest of brothers-in-profession, I humbly apologize for your run-in with the “dark side” and the anti-patent aspect you share.
Not all of us are like that.
I see where you are going, but I do not think that a law passed by Congress to put in place a mechanism will allow a 100% “whim” factor to allow the administrative agency to simply not process any incoming requests. Congress does direct (in mandatory language) certain processing steps.
In fact, Congress does require the Director to set the specifics of the bar that she will be using in order to make the discretionary decision. If indeed, there exists a 100% whim driver, then this section would be surplusage and meaningless. See 35 USC 316(a)(2).
In other words, while there is certainly discretion, the Director announcing by fiat that no processing at all will occur would need to be captured as to the standard for showing sufficient grounds, and if the Director flat out states that no possible grounds would be sufficient runs directly counter to why Congress acted in the first place and created this instrument. Once the Director acts to set the bar, that very act removes discretion to a certain degree.
Eric BerendMay 25, 2017 06:07 am
I recently traveled on business to a well known bucolic famous resort area in the Hudson Valley. On my return, I fell into a conversation with a person who claimed to have worked on the patents for the Alpha CPU chip. It turned out he and his friend’s extreme derision for inventors, couldn’t possibly be more condescending nor contemptuous. I would call it pathological, but I am not a medical professional qualified in that discipline.
And, there are at least some 300,000 more attorneys like that out there in the good ‘ol U.S. of A.: with their intense intellectual envy driving personal, even visceral hatred towards inventors and strongly motivating – for free – their conduct, behavior and actions consistently intended to quite deliberately and irreparably harm said inventors.
Oh, yes: this malevolent, unwarranted enmity; is profound, lifelong and incorrigible – and extremely widespread, among the attorney class, as a rule; in the U.S.
So: just where; as I have previously, however briefly, described; do the vast majority of our lobbyists, legislators and jurists come from? From PR interns to U.S. Supreme Court Justices; they are ALL, nearly UNIVERSALLY: attorneys.
WE inventors do not dare to dictate to you and you ilk, how to practice, derive provenance, establish authority nor legitimacy of your craft –
YET: you attorneys, nearly all inevitably DARE to presume judgment of contempt as default; without notice, appearance nor review; for all said establishments of the inventor’s art, science and craft.
We reject your fraud upon our trust: the malodorous and wholly unwarranted opprobrium routinely attending your paid for and supposedly contractually agreed upon obligations, when we are convinced to engage your services; the exclusion of our Constitutional interests in testimonies before Congress when destroying our historic franchise; the lawyer-crafted and ‘flack’-accelerated portrayals of inventors as “patent trolls”; the pretense of concern for so-called ‘innovation’ even as those most talented to provide same, are simultaneously and routinely derogated in ways that would be impossible without ‘armies’ of attorneys willingly involved.
The acts and statements of those driving this mammoth perfidy are so numerous, so legion, that there is literally nothing that can alter the course of the gigantic IP trainwreck which the United State of America, is indubitably headed for.
It’s OVER. How much evil did you all think you could rain down on us, without our trust being finally, irrevocably broken? And the truth is, aside from minor although important examples such as Gene, no-one in the legal industry cares. That petty, preening, intellectual envy, evidently burning away inside you attorneys so painfully for so long; is, at long last, somewhat assuaged.
That feral genie of envy is not going back into its bottle, anytime soon. Who or what will be the force that can accomplish any such restoration or repair? How will it possibly transpire; even were this general contempt for inventors among attorneys not so; with the incredibly powerful, wealthy infringer sharks in these waters?
Invention RightsMay 25, 2017 12:34 am
Anon, this is a common and critical misconception, perhaps even at the USPTO. Congress indisputably did not require any post grant reviews. It only permits, but does not require institution.
§ 314(a) Threshold.—
The Director may not authorize an inter partes review to be instituted unless…there is a reasonable likelihood that the petitioner would prevail…
H2HMay 24, 2017 11:29 pm
What is the audiance’s opinion of the score card of the PTAB on Ex Parte Appeals?
AnonMay 24, 2017 08:22 pm
As to 100% discretion, I think not. There remains a level that demands action. There may be discretion as to what “hits” that level, but it most certainly is not 100% “whim.”
That itself would draw a Constitutional question.
AnonMay 24, 2017 08:20 pm
Please read my post a little more carefully – the “suspend” and use of the 6 month window is not the main driver of what drew my comment – note the bold emphasis.
angry dudeMay 24, 2017 07:14 pm
why not do proper examination in the first place ?
double, triple, quadruple examination fees but please please give at least some presumption of validity to whatever comes out of PTO
what a farce
Invention RightsMay 24, 2017 03:21 pm
On reconsideration, I disagree with Anon as to the legality of suspending proceedings. 1) there is an extra 6 months built into the statute and a 70% discrepancy between the USPTO divisions easily qualifies as good cause. 2) There is no requirement that the “Director” institute any reviews at all. It is 100% her discretion.
Gene QuinnMay 24, 2017 03:15 pm
Not to speak for the inventors, but having had conversations with U.S. Inventor I can say that it is no secret that their preference would be to abolish the PTAB altogether. They have argued for that as they travel around Capitol Hill. I believe they have been asked to create a list of things that need to be fixed, and this is in response to that specific request.
As for the politics of the PTAB, I personally think it is an impossible lift to do away with the PTAB at this point. The PTAB is less than 5 years old and to jettison the PTAB now would be to admit they made a mistake, which strikes me as the type of self reflection that is impossible in the political world. Perhaps if we can create a legitimate list of fixes required to bring fairness to the PTAB that will demonstrate just how fundamentally broken the PTAB is and the powers that be will come to the conclusion so many of us have reached… that post grant challenges need to be abolished. They are not working and they are fundamentally unfair.
Invention RightsMay 24, 2017 02:51 pm
Anon is right. Even if Trump drains the swamp and appoints a Director to implement every last one of these measures, they will be thrown out as soon as he leaves office. Patents are property, not a political favor.
BemusedMay 24, 2017 11:05 am
I agree with all of your proposals but why not cut to the chase and do away with the PTAB in its entirety?
I do understand the argument that “fixing” the PTAB is more politically doable/acceptable than simply jettisoning it. However, the same efficient infrngers who will line up against these proposed patches will also line up against dissolution of the PTAB. And they’ll fight just as hard against these reforms as they will against doing away completely with the PTAB. If that’s the case, why bother trying to save this abomination through reform?
AnonMay 24, 2017 11:01 am
Scott, Adrian, and Randy,
While I agree strongly with some of your points, I am going to have to disagree with you strongly on a number of matters with your article.
Overall, let me state that aiming at PTAB is aiming at the wrong entity when discussing the most basic faults of the AIA’s IPR system.
It is very much akin to ‘asking the wrong question.’
I follow what you are saying until this point: “ The problem is not examination; it is PTAB procedures”.
The footnote comment of “ If I had a magic wand I’d make the procedures comply with those from federal court” is an indicator of where you venture off the path and into the weeds. If Congress wanted the PTAB to be like the federal court, they would not have bothered in the first place with providing the entire section of the PTAB. You aim at the wrong entity. You ‘ask the wrong question.’
I then follow along with you with your additional factual notes (no problems there for me).
Your comment of “The PTAB is truly a crisis that is driving venture capital, startups and job creation to China” treats a symptom as a cause. One needs to first find the actual cause and treat the cause, rather than chasing symptoms.
Your step 2 of damage control treats “funds” as the only due process consideration for petitioners.
That is a legal error. It is the larger picture of what Congress has done that you need to address. Your desire for the PTAB to unilaterally suspend existing items in process and not let any new items into the process fails in the due process considerations owed to petitioners under the law as passed by Congress. Petitioners have rights too. Asking an executive agency to not follow the law is a non-starter, no matter what Ends you have in mind that you may think justifies such Means. I would not mow down the laws to get to even that devil.
It is not a matter of “charging ahead” as you may like to describe it. It is a matter that the PTAB is actually operating properly (as that term is to be understood in its legal sense) under the law as passed by Congress. Again – you need to ask the right questions.
Any arguments that you put forth for “institution decisions” will fall into the same quandary. You need to establish that what the PTAB is actually doing is against the law as written by Congress.
As it is, you have the horse and cart switched between the institution point and the subsequent trial, and aim at the institution point when it is that subsequent trial that would (according to your view) cause any conflict that you have in mind between the two separate legal points in the process.
As to the supposition that reviews are granted just in order to maintain employment, that’s a more serious charge. Do you have any actual items to substantiate that a quota system is in place? I would find that compelling.
Next, your statement of “well known that the PTAB is financially insolvent.” is incorrect on its face.
The PTAB is not a stand alone entity that could even BE insolvent. Now while it may be a pure “cost center,” the deeper issue that I would re-direct you on this point is reflected in the comments I provided on a thread dealing with the topic and the fact that the AIA allows the USPTO greater fee controls – but only in the aggregate, and that proper accounting is an absolute must in order to see that the USPTO is in fact using that newly granted authority appropriately. Bottom line though as far as the PTAB is concerned: the concept of the funding is completely in line with the law as passed by Congress.
Next, your statement of “PTAB judges apparently have no code of conduct” is a bit premature. See my comments on those respective threads.
Next, you are almost correct with “A patent shall be presumed valid.” PTAB must draw all inferences in favor of preserving the patent.”
While it is true that a granted patent has that particular property stick in its bundle of property rights, AFTER the initiation decision point, when the patent has been brought back into the USPTO for trial, that stick no longer exists. It has been taken by the Executive branch administrative agency – even before ANY adjudication on the merits for taking it.
However, I cannot stress enough that this is NOT the fault of the PTAB.
Instead, as I have long maintained, this is a takings that Congress has written into the AIA. The RIGHT question is whether or not such a takings – as written by Congress – satisfies other Constitutional safeguards that come into play with takings.
At the (separate) legal point of the initiation decision point, is there adequate Article III review? (A: no).
At the (separate) legal point of the initiation decision point, is there adequate compensation for the taking? (A: no).
Be that as it may, let me address your sub-points:
“1. PTAB must require identification of a substantial new question of patentability”
True. However, what this means has NOT been provided by Congress. You may WANT certain things (like, the petition must demonstrate a clear error in the examination, and absent a clear error, challenges must give deference to the original determination of patentability by the examiner and deny the petition, but those are merely “wants.”. Not having your “wants” does not rise to malfeasance on the part of the PTAB. Again – aiming at the PTAB is not asking the right question.
2. Apply the Phillips standard…” and “3. Apply the insolubly ambiguous/not amenable to construction standard”
Also “wants,” and also NOT properly aimed at the PTAB, as it is Congress that handed the PTAB the level of control that you happen not to want. This is directly an offshoot of Congress (NOT the PTAB) aiming to have a NON-court path.
In some manner, your 4. and 5. while perhaps indeed insightful into the gaming that may be going on, are also, merely wants. These though, seem easily implemented, and I don’t have an issue with your complaint here.
Your “6.” falls into the same category as 2. and 3. above.
Your 7. is an interesting idea – but you aim at the wrong target. This would need to be set into the law by Congress, and the PTAB lacks the legal authority to change the system as you are outlining. The bigger picture problem here is that what you are asking for is not even done in the courts (ever wonder why the courts have to use the somewhat tortured language of “not found invalid” rather than “is valid”…? This boils down to trying to stop something that naturally has no such stop. Gene and I have traded comments along the line of “quiet title,” and this mechanism – even possibly broadened to include actions at court, may be considered in any future (aimed at Congress) ideas for provided a true “Quiet Title.”
I also really like your item 8 – and have in fact wanted such a focus to be taken up by Congress in bills that would really improve examination quality. As I have recently pointed out to Mr. Paul Cole, it is examination quality that needs to be the focus (as opposed to drafting quality).
As far as your reporting metrics, I am in agreement (as, I suppose, would be Samuel Clemens), that the statistics being manipulated need to be controlled, with better effects being included, where possible.
However, I am on the fence with your third item, and struggle to have a default “must be for the petitioner” rule. I do “get” that as part of the larger current problems, the impetus to settle DOES favor the petitioner, but will that always be the case?
I completely agree with your second to last paragraph, but again, cannot agree with your aim in the last paragraph.
The problem, frankly, is bigger than what you are aiming at.