When One Door Closes, Try Reexam: TikTok Filing Underscores USPTO Forum Shopping Problem

Here we go again! We’ve heard the story in the past, which is sadly all too common. A patent owner prevails in federal district court, and also prevails at the Patent Trial and Appeal Board (PTAB) in an inter partes review (IPR) challenge, but somehow finds themselves still fighting an ex parte reexamination. How is this possible?

TikTok Restarts the Clock

Perhaps something will be done—this time—because the abusive, harassing challenger is Chinese company TikTok, who is seeking to invalidate the very same claims it failed to invalidate in an IPR that was denied institution on the merits. See IPR2021-00476.

In the latest challenge, TikTok is attempting to again take down claims 1 and 2 of U.S. Patent No. 8,856,030, this time using ex parte reexamination, but with prior art that they chose not to include in the lost IPR. See Patent Owner’s Petition to Deny Ex Parte Reexamination. The choice not to use prior art, whether good or bad, is supposed to have statutory consequences, and it would in a subsequent IPR. TikTok would be estopped from raising different prior art that it knew about in a subsequent IPR, but can raise it in reexamination? Because they don’t like the claim construction that both the PTAB and district court agree on shouldn’t qualify them to walk through the reexamination door when the IPR door has been closed and locked. This is nothing more than forum shopping within the U.S. Patent and Trademark Office (USPTO) itself, without any new information for consideration.

It’s Time for the USPTO to Apply Vivint

At a minimum, this situation demands for the USPTO to start scrupulously applying Federal Circuit precedent from the Vivint decision, which characterized similar, serial challenges as “harassment of patent owners” that causes “frustration of Congress’s intent”. To keep challengers from using reexamination for follow-on, serial challenges that are in this case identical seems wholly unquestionable and entirely appropriate. These practices have been outlawed in IPR; why should they exist in reexamination?

Unfortunately, we live in a fantasy world where nothing really makes any sense when post grant challenges are involved, and that isn’t because of anything the PTAB is doing or is likely to do, but rather because of the horribly defective way the tribunal was established when it was created by Congress as a part of the America Invents Act (AIA) more than a decade ago. With a system set up to give challengers every opportunity to over and over again dispute claims and relitigate lost claim constructions it is hardly surprising when challengers lose, lose, and lose again, but still find themselves with procedural avenues to collaterally attack and relitigate failed attempts to invalidate claims.

Double Standards

This type of second bite at the apple is ostensibly allowed—wink, wink, nod, nod—because the standards being applied are different. For an IPR to be instituted, the petitioner must demonstrate that there is a “reasonable likelihood” that at least one of the challenged claims will be found to be invalid. But, to institute an ex parte reexamination the standard employed by the USPTO requires determination of whether “a substantial new question of patentability” is present. See 35 U.S.C. 303. Although not applicable to this situation, the PTAB will also apply a “more likely than not” standard when determining whether to institute a post grant review.

How do these standards—“reasonable likelihood”, “substantial new question” and “more likely than not”—differ? That is an excellent question for which there is no real answer; or at least not a standardized, uniform answer. What is and is not reasonable, substantial and likely lies in the eye of the beholder, not in any discernible, repeatable or common-sense test. And the difference among all these standards has certainly not been elucidated by the Federal Circuit.

It is truly ironic though that a petitioner can be barred from re-entry into the USPTO through the PTAB and yet gain re-entry to again litigate the exact same issues through the Central Reexamination Unit at the USPTO. Even more peculiar—or downright stupid really—is the fact that if TikTok succeeds in having a reexamination instituted and the patent owner loses and seeks internal review before going outside the agency it will be the very same PTAB that has already denied an IPR because there is no reasonable likelihood of success.

What this means, in a nutshell, is that the PTAB, which has found that there is not a sufficiently reasonable likelihood that TikTok will prevail in an IPR challenging claims 1 and 2 of the ‘030 patent will ultimately be asked whether the very same claims are patentable if and when the Central Reexamination Unit decides there is a substantial new question of patentability warranting reexamination. But how in the name of sanity can there possibly be a substantial new question of patentability where there is no reasonable likelihood that either claims 1 or 2 are invalid and improvidently granted?

Harassment by Design

Earlier this year, I wrote about the insanity of allowing an ex parte reexamination to proceed once an IPR has been denied, and this case is even worse. The PTAB has already rejected TikTok’s challenge on the very same claims of the very same patent. It is a nonsensical waste of time and a colossal waste of resources for the USPTO, patent owner, and ultimately the PTAB, to undertake what by all rights should logically be nothing more than an academic inquiry. Sane people will readily understand that without a compelling explanation, such as late arriving, unknown prior art, if there is no reasonable likelihood these claims were improvidently granted there can be no legitimate reason to believe there is a substantial new question that requires inquiry anyway. This latest TikTok challenge of the ’030 patent is purely wasteful, harassing, and aggravating, and there is nothing new in the argument that would make a rational person want to take what would now be a third look at these claims.

A commonsense rule that prohibits the filing and institution of a reexamination after a failed IPR is long overdue. The USPTO needs to implement a rule that prevents the abuse of agency resources challengers expect when they lose under one standard and pretend that things will be different under a different standard. No, things will not end any differently, not at least if intellectual honesty and comity mean anything.

Of course, in a world where the closing of one door means another door with a different standard remains wide open, the patent owner must endure a ridiculous war of attrition based on no new information. This is harassment pure and simple, and it would seem inconceivable if it weren’t by design. And perhaps the key question we should be asking is how does any of this make sense with a Chinese petitioner, at a time with descending U.S. innovation and ascending Chinese innovation?

Image Source: Deposit Photos
Author: benchyb
Image ID: 245375872