Lofgren is now opposing a rule change she previously endorsed as an original co-sponsor of a bill that would have changed the claim construction rule in exactly the same way proposed by Director Iancu.
On July 9th, Congresswoman Zoe Lofgren (D-CA) sent a letter addressed to U.S. Patent and Trademark Office Director Andrei Iancu regarding proposed changes to the claim construction standard for patent claims being challenged at the Patent Trial and Appeal Board (PTAB). Not only does the letter show that Lofgren is woefully out of touch with the real-world issues presented by the PTAB, it also begs the question as to her motives. Congresswoman Lofgren is now opposing a rule change she previously endorsed as an original co-sponsor of a bill that would have changed the claim construction rule in exactly the same way proposed by Director Iancu.
Lofgren’s letter comes in response to the proposed rule to change the claim construction standard in inter partes review (IPR), post-grant review (PGR) and covered business method (CBM) review proceedings at the PTAB. The USPTO is proposing a rule change that would move claim construction from the broadest reasonable interpretation (BRI) standard currently employed by the PTAB to the Phillips construction standard used in patent cases filed in U.S. district court.
It is worth noting that the United States Court of Appeals for the Federal Circuit refers to the Phillips standard as the “correct construction” when comparing it to the broadest reasonable interpretation. Judge Moore explained that currently in post grant challenges “claims are given their broadest reasonable interpretation consistent with the specification, not necessarily the correct construction under the framework laid out in Phillips.” See PPC Broadband, Inc. v. Corning Optical Communications (Feb. 22, 2016).
In the letter, Lofgren says that she has two major concerns. First, that this “change in a vacuum” upsets the Congressional intent behind the enactment of the America Invents Act (AIA) of 2011 which created the PTAB and circumvents Congress’ prerogative on the issue. Second, that this change will produce unintended consequences in the form of forum shopping and the usurpation of the PTAB’s authority on claim construction.
Lofgren does end up discussing the Innovation Act, the aforementioned bill that she co-sponsored, as the only one of a total of eight bills changing the claim construction standard that managed to be reported out of committee. However, the letter never mentions Lofgren’s co-sponsorship of that bill and she calls the Innovation Act “a complex and balanced litigation reform measure that, begrudgingly, included a switch from BRI to Phillips claim construction… To pluck this one controversial piece out of a comprehensive bill and implement it through a rulemaking disregards the current work Congress is doing on patent litigation reform to combat patent trolls.”
But how is adopting a rule that would have already been the law had Lofgren had her way possibly frustrate or disregard Congress? Of course, we aren’t supposed to ask that question. Once the “patent troll” boogeyman card is played everything else is supposed to fade away.
To Lofgren and her allies on both sides of the aisle, any measure that somehow reins in these mythical creatures is worth supporting, no matter the collateral damage it causes to the U.S. patent system. Lofgren utilizes this language despite the Federal Trade Commission’s 2016 study on patent assertion entities (PAEs) which noted that the term “patent troll” was “unhelpful because it invites pre-judgement about the societal impact” of a patent-based business model. This notion is also supported by a 2016 article published by the Stanford Technology Law Review which found that the term “patent troll” leads to a “moral panic in which rational policymaking and decision-making give way to hysteria.” Such hysteria was on full display at a USPTO oversight hearing in late May where Lofgren took Director Iancu to task for proposing the claim construction rule change, telling him that “in the real world, we have patent trolls out there holding people up.”
The July letter sent by Lofgren to Director Iancu brings up a few facts and figures to support her position, such as the low rate of stay requests granted by the Eastern District of Texas and the District of Delaware and the disparity of case-management timelines leading up to Markman hearings in different districts. But, truly, Lofgren’s recent actions prove that the efficient infringement cabal haven’t just bought the Congresswoman’s vote, they’ve hired a very effective servant who will be a mouthpiece for their interests in the years to come.
The office of Congresswoman Lofgren provided the following statement on why the Congresswoman is so opposed to Director Iancu’s proposed rule change when she supported the same rule change as a co-sponsor of the Innovation Act:
“The Innovation Act was a complex and balanced litigation reform measure. By itself, I would not support a switch from BRI to Phillips claim construction in IPR. However, as a component of a larger reform effort, I begrudgingly felt this tradeoff was worth the other litigation reforms included in the bill.
“No legislation to date has considered this change proposed by the USPTO by itself. I do not believe the change will result in increased judicial efficiency, which the USPTO has described as an increase in the granting of motions to stay in district court. The current rate of success for stays is due in large part to the abnormally low rate at which these motions are granted in two jurisdictions that hear almost one third of all requests. A frequent cause of the denial of stay motions in these jurisdictions is the USPTO’s failure to institute all the claims at issue in a court proceeding, which was fixed by SAS Institute. There is no reason to believe that changing to Phillips will have a noticeable impact in light of the bigger fix by SAS Institute.
“Instead, a change to Phillips probably guarantees that the PTAB will be subject to issue preclusion on claim construction completed by either district courts or the ITC. This creates the perverse incentive to forum shop for more favorable or faster jurisdictions with the hopes of winning the race to Markman. I think this could have a profoundly negative impact on the work done by the PTAB.”
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18 comments so far.
PoesitoAugust 2, 2018 06:48 pm
Just goes to show you, we have the best government that money can buy.
Night WriterJuly 31, 2018 01:47 pm
By the way, in the picture, a Google representative was standing in front of her and she was grabbing for another stack of Google bucks.
EGJuly 30, 2018 10:47 am
Lofgren is obviously “bought and paid for” by Google and should be treated as such-with contempt and disdain.
Night WriterJuly 30, 2018 10:01 am
@11 and 12
My bet is that Google wrote her letter and that she is going to say and do what she is told. Probably she has side deals and other ways of getting money too.
Interesting that her second biggest contributor is an immigration company. She looks like the typical I am for sale Congressperson.
ValuationguyJuly 30, 2018 08:41 am
Congresswoman Lofgren is just whining that without the efficient infringement allies (her, Issa, Goodlatte, and the current top Dem on the House Judiciary Committee) having the claim construction card to be able to dangle in front of those in Congress who want to promote innovation….they will need to make/dangle OTHER real reform provisions to get (or keep) some of the key provisions that are currently law from getting into the NEXT reform bill.
Essentially she is saying that by taking away a bargaining chip from the industry…the PTO is upsetting the “reform” negotiations (which is certainly true…even if few patent owners will complain)…and her side (big tech) is the loser in such a situation.
Iancu is already WELL-AWARE of Zoe Lofgren’s concerns and the underlying naked THREAT she is trying to convey. This threat isn’t just academic as Zoe is trying to point to the possibility that the Dems take the House in Nov….and Lofgren in such a case would probably be taking either Goodlatte’s Committee Chairmanship or Issa’s Subcommittee Chairmanship…..both of which would make Iancu’s work at reforming the PTO and PTAB that much harder.
John KerryJuly 30, 2018 07:56 am
I actually did vote for the [change] before I voted against it
Disenfranchised Patent OwnerJuly 30, 2018 07:16 am
Hopefully someone will point out to her the error of her ways, as you have. Thank you for parsing her sentence in a way that shows how convoluted her “logic” is.
This is a bit like, “If you like your claim construction standard, you can keep your claim construction standard.” Or not. Depending on what Google says it is.
Ron KatznelsonJuly 29, 2018 10:40 pm
Rep. Lofgren’s letter itself destroys the very narrative it attempts to convey. The letter contends:
“While I do not dispute the USPTO’s authority to modify the claim construction standard used during IPR, it is also without dispute that Congress intended that the USPTO use a broadest reasonable interpretation (BRI) when constructing claims for IPR.”
Any reader with basic familiarity in administrative law would recognize the stark contradiction between the first and second parts of this sentence. If the second part of the sentence were correct – if “Congress intended that the USPTO use the [BRI]” – the PTO would not have the rulemaking authority admitted to in the first part of the sentence.
First, where does this “USPTO’s authority” to set the claim construction standard come from? It comes from the very fact that Congress’ intent on claim construction cannot be ascertained from the statute. The Supreme Court recognized as much stating that “neither the statutory language [in the AIA], its purpose, or its history suggest that Congress considered what standard the agency should apply when reviewing a patent claim in inter partes review.” Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2144 (2016). The AIA thus left a “gap” under the Chevron deference to be filled by the USPTO’s reasonable interpretation of the statute. The first part of Rep. Lofgren’s sentence is correct.
Second, if the second part of the sentence were correct – if “Congress intended that the USPTO use the [BRI]” – there would be no Chevron deference to agency decision to change the claim construction standard. This is clear from the Chevron decision itself: courts “must reject … constructions which are contrary to clear congressional intent [citing cases]. If a court, employing traditional tools of statutory construction, ascertains that Congress had an intention on the precise question at issue, that intention is the law and must be given effect.” Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843, n. 9 (1984) (citations omitted, emphasis added). But that was clearly not the case in the AIA.
Therefore, the (correct) USPTO authority statement in the first part of Rep. Lofgren’s sentence self-destructs the rest of the letter, rendering it a mere false narrative.
TernaryJuly 29, 2018 05:24 pm
Zoe Lofgren represents the 19th Congressional District, which encompasses the City of San José and parts of Santa Clara County, at least a part of Silicon Valley. She clearly represents the interests of large companies (who contribute towards her campaigns) in her District, not the interest of independent inventors there or elsewhere in the USA.
If you don’t believe it, read her public website statement on Patent Reform:
“Patents are a critical source of our economic vitality, but abusive patent litigation takes a tremendous toll on government and private sector resources. Instead of using their resources to create and innovate, startups and leading enterprises alike often find themselves mired in endless—and needless—litigation. ”
However, as we all know by now, the “tremendous toll” is brought upon independent inventors who are wasting their time and money on useless and byzantine prosecution procedures in the USPTO, rather than on creating and innovating.
Lofgren is running for re-election. Independent Inventors can and do vote, companies don’t. So, independent inventors in the 19th Congressional District: vote her out of Congress. And, at re-election meetings ask her what she thinks about the value of independent inventors for the US Economy and what she does in Congress and plans to do in a new term to represent and improve the current weak position of independent inventors.
Paul MorinvilleJuly 29, 2018 03:36 pm
Looks like Lofgren is going to pick up where Googlatte and Issa left off. Might need to engage some inventors I’d her district like we did with Issa.
Night WriterJuly 29, 2018 01:03 pm
Sorry for multiple posts, but..
Her top contributor is Google. Be interesting to ask her if a Google employee called her and asked her to object and if they helped prepare her statement.
Contributor Total Individuals PACs
Alphabet Inc $72,450 $52,450 $20,000
Night WriterJuly 29, 2018 12:58 pm
She gets her campaign contributions from Google.
Night WriterJuly 29, 2018 12:57 pm
So Google is her second biggest contributor.
Contributor Total Individuals PACs
Fragomen, Del Rey et al $64,745 $62,045 $2,700
Alphabet Inc $44,700 $34,700 $10,000
Cisco Systems $42,150 $32,150 $10,000
Butler Amusements $32,000 $32,000 $0
Intuit Inc $24,850 $19,850 $5,000
Pro SeJuly 29, 2018 11:57 am
The page at the Gov’s ePortal show there are *32 comments received on this rule:
Compare that to other USPTO pages for comment and you’ll see most if not all others have *0 comments.
This signals there’s an overwhelming interest into this rule change for a reason:
Phillips will stop the loose overly broad 4-12 reference stitching of publications and specs to combat legal claim language.
A “car” will mean “automobile” and not “any means for carrying passengers”.
This slaughter under BRI to hard fought issued patents MUST END, because unlike the congresswoman who can accept healthy donations and not pay any taxes, the strongest Inventors and Innovators of America are on our last knee, and I’m about tired of people who mostly never created or built anything keep changing the rules of how engineers communicate with other engineers.
Pro SeJuly 29, 2018 11:40 am
Congresswoman from California… just guess where her money bags come from.
TJJuly 29, 2018 11:06 am
Lofgren’s opinion is completely out of touch and based on a nonexistent fear of something not even relevant today: forum shopping. She says:
“The current rate of success for stays is due IN LARGE PART large part to the abnormally low rate at which these motions are granted in two jurisdictions that hear almost one third of all requests. … Instead, a change to Phillips PROBABLY guarantees that the PTAB will be subject to issue preclusion on claim construction completed by either district courts or the ITC. This creates the perverse incentive to FORUM SHOP shop for more favorable or faster jurisdictions with the hopes of winning the race to Markman. I think this COULD have a profoundly negative impact on the work done by the PTAB.”
Note the use of indefinite language here regarding her opinion in how a change to Phillips would affect forum shopping: “in large part”, “probably guarantees”, “could have a negative impact”. In short, she doesn’t know. Her opinion is based on fear and not on fact.
And moreover, she’s out of touch with reality and still living in 2016. TC Heartland clarified the definition of “residence”, and as a result, plaintiffs cannot forum shop to any district of their choosing.
If forum shopping is her true concern, then she should focus that statute. And where is that? I don’t see her mention or proposed modifications of 1400b or the affects of TC Heartland anywhere.
And on that note, TC Heartland was a major blow for inventors.
TC Heartland threw out the baby with the bathwater, because inventors now must traverse the US to each state where a defendant resides in order to bring a suit of infringement, which is not feasible for legitimate inventors. This becomes a major deterrant to encouraging innovation and the progress of the arts and science, because what good is a patent if an inventor cannot feasibly defend it?
1400b should be expanded to include districts where an inventor listed on the patent performed research that lead to the patent in suit. This would not introduce any forum shopping and would simultaneously support legitimate inventors.
THIS is the legislation that needs to be changed, and all inventors should contact their representatives in support of amending 1400b to include inventor-researched districts.
PTO-IndenturedJuly 29, 2018 10:45 am
And ‘the next’ troll-myth crier, cries ‘Wolf!’ — yet again…
New Rule: Require any anti-patent, fearmongering activist (paid-for, or not) high on troll-myth Kool-Aid, have to cite a specific actual and substantive higher-court case where a real-world patent troll act was even an issue of the case. Then have to compare, in U.S. dollars what the cited direct-damage amount was, relative to the estimated trillion+ $$ in innovation/IP loss reaped by PTAB, IPRs and BRI since AIA was implemented.
Follow the Money…
Oh, and during any of such representation, require that the total political ‘contributions’ made by the tech-elite companies (the real beneficiaries of the troll-myth), paid to the troll-myth crier, be clear and present e.g., shown on-screen, contrasted against other contributions made to the crier within a same time-period.
The troll-myth relies on fear, ironically/largely
Kevin E NoonanJuly 29, 2018 09:52 am
While I disagree with her motivations (fear of the dreaded patent troll), the Congresswoman does have a point about the negotiations involved in most legislation (although it would be better if she had identified the quid that balanced for her the Philips quo). Not sure how she thinks a district court will get to Markman faster than the PTAB; this might be her most out-of-touch position. What we need is more scholarship surrounding the troll narrative and the counterpoint of efficient infringement to rebut the “real world” assertions- after all the PTO is likely more in touch with real world considerations than Congress, where the members can be unduly influenced by advocates and donors