USPTO Seeks Comments on Discretion to Institute Trials Before the PTAB

“The USPTO is now engaging in an ‘ongoing effort to achieve consistency and fairness’ and is ‘considering promulgating additional rules based on this broad experience as it relates to considerations for instituting AIA trials.'”

comments - October 20, the United States Patent and Trademark Office (USPTO) published a “Request for Comments on Discretion To Institute Trials Before the Patent Trial and Appeal Board” in the Federal Register. In particular, the USPTO is considering the codification or modification of its current policies and practices with respect to instituting trials before the Office under the Leahy-Smith America Invents Act (AIA).

The Office submitted a proposed rulemaking to the White House’s Office of Management and Budget (OMB) last month with the aim of formalizing recent practices under precedential opinions including Apple Inc. v. Fintiv, Inc; General Plastic Industries Co. Ltd. v. Canon Kabushiki Kaisha; and Becton, Dickinson & Co. v. B. Braun Melsungen AG. Earlier in September, a lawsuit was filed by Apple, Google, Cisco and Intel against the U.S. Patent and Trademark Office (USPTO) in the Northern District of California challenging the PTAB’s adoption of the NHK-Fintiv framework as procedurally invalid under the Administrative Procedures Act (APA) and arguing that the PTAB’s application of the NHK-Fintiv discretionary denial factors violates the America Invents Act (AIA).

Tuesday’s request for comment noted that the USPTO has published an “Office Patent Trial Practice Guide” to inform the “public on the general framework of the rules and proceedings, including the structure and times for taking action in each of the new proceedings.”

Since 2012, the USPTO has designated more than 40 decisions in AIA proceedings as precedential or informative, and “has issued several updates to the Trial Practice Guide that were subsequently consolidated” in 2019 as the “Patent Trial and Appeal Board Consolidated Trial Practice Guide.” The USPTO is now engaging in an “ongoing effort to achieve consistency and fairness” and is “considering promulgating additional rules based on this broad experience as it relates to considerations for instituting AIA trials.”

Discretion in Deciding Whether to Institute AIA Trials

The publication explained that the Patent Trial and Appeal Board (PTAB) institutes a trial on behalf of the Director and, when considering whether to institute, considers “whether a petitioner has satisfied the relevant statutory institution standard.” However, even when a petitioner satisfies the institution standard, the Director has the discretion to deny a petition. In order to establish a balance between achieving an “efficient and streamlined patent system that will improve patent quality and limit unnecessary and counterproductive litigation costs” and preventing “administrative attacks on the validity of a patent”, the USPTO takes into account a variety of factors when determining whether to institute a proceeding, including “ [t]he economy, the integrity of the patent system, the efficient administration of the Office, and the ability of the Office to timely complete instituted proceedings.” This “case-specific analysis” developed by the USPTO has been an “attempt to balance Congress’s intent for AIA proceedings to be ‘quick and cost effective alternatives to litigation,’ on the one hand, with ‘the importance of quiet title to patent owners to ensure continued investment resources,’ on the other hand.”

Serial and Parallel Petitions

The USPTO said it has provided guidance on the number of petitions typically required by a petitioner to challenge the same patent at or about the same time in the 2019 Trial Practice Guide Update. While noting that “one petition should be sufficient to challenge the claims of a patent in most situations,” the PTAB recognized that in some rare circumstances “two petitions by a petitioner may be needed.”

Citing General Plastic Co., Ltd. v. Canon Kabushiki Kaisha, IPR2016-01357, the publication explained that the PTAB “recognize[d] the potential for abuse of the review process by repeated attacks on patents.” General Plastic set forth several “nonexclusive factors” for the PTAB to consider when determining whether to institute an IPR, particularly with respect to “follow-on” or “serial” petitions “challenging the same patent as challenged previously in an IPR, PGR, or CBM proceeding.” The General Plastic factors included:

(1) Whether the same petitioner previously filed a petition directed to the same claims of the same patent;

(2) whether, at the time of filing of the first petition, the petitioner knew of the prior art asserted in the second petition or should have known of it;

(3) whether, at the time of filing of the second petition, the petitioner had already received a patent owner’s preliminary response to the first petition or received the Board’s decision on whether to institute review in the first petition;

(4) the length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition;

(5) whether the petitioner provides an adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent;

(6) the finite resources of the Board; and

(7) the requirement under 35 U.S.C. 316(a)(11) to issue a final determination not later than one year after the date on which the Director notices institution of review.

With respect to parallel petitions that challenge the same patent at or about the same time, the PTAB has indicated that “one petition should be sufficient for a petitioner to challenge the claims of a patent in most situations.” However, the publication noted that the USPTO recognizes that there may be instances where more than one petition is necessary, such as “when a patent owner has asserted a large number of claims in litigation or when there is a dispute about priority date, thereby requiring unpatentability challenges under multiple prior art references.”

Other Considerations and Request for Input

The proposed rule also addressed how the PTAB strives to achieve timely completion of proceedings and efficient administration of the USPTO and explained that that USPTO recognizes that “events in other proceedings related to the same patent, either at the Office, in U.S. district courts or at the U.S. International Trade Commission (ITC), may also impact the institution decision.”

The USPTO said it has already received input from stakeholders, specifically indicating that the Office’s use of discretion has helped to ensure that “(a) AIA proceedings do not create excessive costs and uncertainty for the patent owner and the system, while (b) meritorious challenges by petitioners can be maintained.” However, the publication also noted that some stakeholders have proposed that the USPTO adopt a “bright-line rule that it should use its discretion to preclude claims from being subject to more than one AIA proceeding, regardless of the circumstances” or that the USPTO should “only permit more than one AIA proceeding if the follow-on petitioner is unrelated to the prior petitioner.” In contrast, others have proposed that the UPSTO adopt a “bright-line approach that there should be no limits on the number of petitions that can be filed or the number of AIA trials that can be instituted against the claims of a patent, so long as the petition complies with statutory timing requirements…and meets the particular institution threshold of showing that at least one claim of the patent is unpatentable.”

Send Your Comments

The USPTO has requested comments on or before November 19, 2020. The Office specifically requested input on whether it should “(a) altogether disregard whether the claims have previously been challenged in another petition, or (b) altogether decline to institute if the claims have previously been challenged in another petition.”

The USPTO also requested input on whether the PTAB should “(a) altogether disregard the number of petitions filed, or (b) altogether decline to institute on more than one petition” when considering whether to institute more than one petition filed at or about the same time on the same patent.

With respect to proceedings in other tribunals, the USPTO requested input on issues including whether the PTAB should “(a) altogether disregard such other proceedings, or (b) altogether decline to institute if the patent that is or has been subject to such other proceedings, unless the district court or the ITC has indicated that it will stay the action.”

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Join the Discussion

2 comments so far.

  • [Avatar for Martin Nguyen]
    Martin Nguyen
    October 23, 2020 12:53 pm

    Straightforward- The AIA should be removed immediately. It only helps foreign companies and troubles the US economy, period.

  • [Avatar for Pro Say]
    Pro Say
    October 22, 2020 07:25 pm

    With Congress justifiably ratcheting up their efforts to tame Big Tech for the good of our country, the forthcoming comments from Google, Facebook, Amazon, Apple, et. al. aren’t worth the paper they’ll be written on and should carry no weight with the hard-working Director and his colleagues as they do their darnedest to right the innovation-killing. patent-pirate PTAB ship.

    No weight.

    PTAB trials have been off the Congressional-intended rails since their institution — and everyone — including Big Tech — knows it.

    Let them cry, screech, wail, and howl all they want.

    It is Halloween, after all.

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