Posts Tagged: "IPR"

The nation’s highest court will once again address issues surrounding the controversial Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office (USPTO). The case it will decide is SAS Institute, Inc. v. Lee, which will be argued during the October 2017 term, and which will force the Court to again look at how the USPTO, and more specifically the PTAB, is implementing the post-grant patent validity trials created when Congressional passed of the America Invents Act (AIA) of 2011… As SAS Institute’s petition notes, the track record of the PTAB is clear. The PTAB believes that final written decisions need only to address certain challenged claims, not every challenged claim.

In a rare IPR affirming patentability, the Patent Trial and Appeal Board (the “Board”) found claims of US Patent No. 6,945,013 to be patentable that were directed to a “method for automatically aseptically bottling aseptically sterilized foodstuffs” in which bottles are “aseptically disinfected at a rate greater than 100 bottles per minute”. However, this unusual pro-patentee outcome was too much for the Federal Circuit. It ultimately vacated and remanded on claim construction grounds, thus highlighting the success of IPRs in achieving their goal of judicial economy.

Patlex, which dealt with reexamination of applications by an examiner — not by an Article I tribunal — could be considered a next step beyond McCormick. MCM, however, simply cannot be viewed as consistent with either Patlex or McCormick on any level. Indeed, the Supreme Court was abundantly clear in McCormick, which remains good law. The courts of the United States (i.e., Article III courts), not the department that issued the patent, is the only entity vested with the authority to set aside or annul a patent right. Since the PTAB is not a court of the United States, it has no authority to invalidate patent rights. It is just that simple.

“The results from the Patent Trial and Appeal Board reflect the procedures it applies, and in my judgment the procedures are wildly off base,” Judge Michel explained… “We’ve had PTAB final results… whatever the intentions were we don’t have to speculate… we have ample evidence of how it worked in practice. We know it doesn’t work satisfactorily.” *** “I don’t think things are really getting much better,” Kappos said. “We are in what I refer to as the leaky life raft.” When you are stranded and a leaky life raft comes along it looks great, but it doesn’t change the fact that it is still a leaky life raft. “The best you can say about 101 is that it has stabilized in a terrible space.”

Had APJ Clements not been a member of the PTAB and one of the patent owners – let’s say Smartflash for example – had come to him and asked him to represent them in a PTAB proceeding against Apple, the conflict of interest question would have been a much easier question. Having represented Apple previously as defense counsel it would seem that the duty to a former client under 37 CFR 11.109 would prevent Clements from representing the patent owner adverse to Apple and now charging Apple with patent infringement, which is a prerequisite to the filing of a CBM petition. Had Clements represented Smartflash in any of the CBM proceedings brought by Apple on which he sat as a judge there would seem to be a direct and irreconcilable violation of the ethics rules applicable to patent attorneys and patent agents. How truly ironic, and pathetically sad, it would be if the ethical bar set for practitioners is so much higher than the ethical bar the USPTO sets for its own Administrative Patent Judges. How could that possible? In what universe would it make any sense to have a lower ethical bar for judges deciding cases than for patent practitioners?

If an APJ making decisions in a case within 18 months of having represented a former client complies with whatever USPTO conflict rules or guidelines apply to PTAB judges, the USPTO conflict rules or guidelines are too lenient and must be changed. PTAB just should not be deciding cases involving post grant petitions filed by former defense clients, and under no circumstances is 18 months long enough to alleviate any concerns of bias or take away the appearance of impropriety… If identification of the real party-in-interest is so important perhaps that transparency should be a two-way street. Perhaps there should be a public Code of Conduct for PTAB judges, and perhaps the USPTO should give stakeholders the opportunity to be heard on whether 2 years is an appropriate length of time to wash away a conflict of interest, or the appearance of impropriety that exists when deciding cases dealing with former clients. My guess is most patent owners would be adamantly opposed to PTAB judges deciding petitions challenging patents brought by their former clients.

For more than two centuries, the U.S. Constitution, black letter law and precedent construed a patent as a property right. This is important because it is the nature of property rights that enables investment in early stage startup companies, especially those with cutting edge technologies in highly competitive fields like pharmaceuticals, biotech, smart phones, enterprise software, internet, semiconductors and other technologies critical to our infrastructure, military and much more… The same agency that takes inventor money to grant patents takes infringer money to destroy them. This creates an appearance of double dealing, and inventor belief that the USPTO is breaching the “grand bargain” of the patent system. Inventor confidence is at an all-time low because inventors are lured away from using trade secrecy protection, but then given nothing in return for disclosure. The effect of PTAB on inventors is devastating. Since institution of PTAB, over 50% of inventors simply quit rather than suffer the financial and stressful indignation of post grant invalidation.

An Inter Partes Review (IPR) is an important tool for companies that face frequent patent infringement challenges. An IPR is essentially a mini-litigation focusing solely on patent validity conducted before a panel of administrative patent judges sitting in the Patent Trial and Appeal board (PTAB). Once an IPR is initiated, a decision on validity is issued within one year. The narrow focus, fast timing, and lower cost of an IPR, along with certain legal advantages that make proving invalidity easier in an IPR than in a district court, make it an attractive alternative to district court litigation when good invalidity arguments are available.

Concerns over software and biotechnological innovations being patent eligible, the omnipresent threat of patent reform that could make it even more difficult to enforce the patent property right, and no clear path to a philosophical or ideological turning point make for little to celebrate this World IP Day in America… If Congress wants to resurrect the U.S. patent system these three decisions would be overturned. As long as these decisions remain in force the U.S. patent system will continue to suffer and will undoubtedly be looking up in the rankings to the likes of Hungary when the Chamber releases its 2018 world IP rankings.

Unified Patents is a relatively new form of patent troll that works as a “Troll of Trolls” or “ToT.” They file IPRs (inter-partes reexamination requests) to kill patents. While they purport to only attack “bad patents,” their definition of a “bad patent” is simply any patent asserted against their clients. So who are their clients? Good question – that is a large part of the problem. They keep most of their clients’ identities secret. Unified does identify a handful of their members on their website such as Adobe, Google, NetApp, Roku, and Salesforce… But China is different. Here, a mercenary third party attacking innovation via patents is problematic. China, unlike America, has made innovation a top priority. China’s government has also, over the last few years, created the best patent enforcement environment in the world.

We analyzed all of the packages in our database to look at the use of the assets after receipt of the package by the broker. Because we used a better source of US litigation and inter partes review data this year, it makes it impossible to compare our results to our previous year’s analysis. Focusing on package-level analysis for packages received in the market years from 2012 to 2016, and looking for packages with at least one litigation or inter partes review as of October 2016, we found that the sold packages are litigated and inter partes reviewed to a greater degree than packages generally.

The Federal Circuit affirmed a Patent Trial and Appeal Board (“Board”) decision finding a patent owned by Novartis AG and Mitsubishi Tanabe Pharma Corp. (collectively “Novartis”) to be unpatentable as obvious… Refusal by the Board to institute an IPR based on a particular reference does not necessarily preclude the Board from relying on that reference as additional support for a motivation to combine other references. Separate patentability arguments for dependent claims must be clearly argued lest they stand or fall with parent claims. A nexus for non-obviousness due to commercial success must clearly flow from the patented invention and not from subject matter known in the prior art.

Inter Partes Review (IPR) is viewed by many as late-stage destruction of fully developed early-stage investor ROI in patented property. The Lee study will presumably weigh the costs of the PTAB and IPR against its benefits, but the worst far-reaching costs will not show either in its records or dialogue with its “users.” Examining “five years of PTAB files and user experience” cannot reveal the indirect harm the PTAB has inflicted on our innovation ecosystem through the threats to file IPR petitions during licensing negotiations, the impact on declining patent values, the weaponization of the PTAB by the infringement defense bar and its unexpected heavy utilization. Discovering what the PTAB hasn’t seen and why it never saw it would be more informative and more relevant.

If the patent owner intends claim terms to have a special meaning, the patent must provide a clear disavowal of ordinary meaning or an alternative lexicography. Otherwise, the patent owner can expect to obtain the full scope of the term’s plain and ordinary meaning. Ordinary meaning also may yield to context, as where “sequence” may include “one bit,” not “at least two.” The Court also stresses that anticipation requires that a single reference “describe the claimed invention with sufficient precision and detail to establish that the subject matter existed in the prior art.” Ambiguous references do not anticipate a claim.

Uber is initiating a patent purchase program and is accepting submissions through May 23, 2017. British musician Ed Sheeran settles a copyright infringement suit that alleged “Photograph” was infringing. The Ninth Circuit deals a blow to websites that allow users to post photographs of celebrities, ruling that summary judgment was inappropriate and that agency theory is applicable under DMCA safe harbor provisions. The Andy Warhol Foundation preemptively files a DJ action against a photographer, the Federal Circuit denies rehearing in Unwired Planet v. Google, the ITC takes judicial notice of the PTAB refusing to institute IPR proceedings, and IBM teams with Teva Pharmaceuticals to apply cognitive tools to drug discovery.