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How Much Will Post Grant Proceedings at the USPTO Cost?
Filing Fees to Increase Substantially
From start to finish, the cost of an inter partes patent reexamination (IPX) proceeding is estimated to be $278K by the 2011 AIPLA Economic Survey. This figure includes all expenses from the time of filing the request to a decision of the Board of Patent Appeals & Interferences (BPAI). The government filing fee for requesting inter partes patent reexamination is $8800.
The America Invents Act (AIA) introduces several new inter partes proceedings for the purposes of challenging the validity of a U.S. Patent. The first, Inter Partes Review (IPR), will be available on September 16, 2012 and will replace IPX. The second, Post Grant Review (PGR) will also be available on September 16, 2012 to challenge certain business method patents. Thereafter, PGR may be used to challenge (within a 9 month window after issuance) a patent filed on or after March 16, 2013.
As discussed yesterday, IPR will provide a significant improvement over IPX with respect to overall pendency delays. PGR will follow the same general timeline. In addition to the improvement in pendency, both IPR and PGR will provide for limited discovery, protective orders, oral hearings, settlement, and the management of the proceedings by a three person Administrative Patent Judge (APJ) panel of the new Patent Trial & Appeal Board (PTAB). But, what is all of this going to cost filers?
If initial rumors out of the USPTO are correct, the filing fee for IPR and PGR will be on the order of $48,000. This is a significant increase over the current fee for IPX ($8800) and is intended to cover the increased effort of the agency to conclude these proceedings within 12-18 months. Likewise, as the Office will be assigning three APJs to every filing, and will be managing discovery, oral proceedings and a trial, there will be additional burdens on resources.
As to attorney fees, using the $278K average of IPX as a baseline, one can expect the cost of the new proceedings to at least double due to the increased time pressures, additional discovery and quasi-litigation features.
While half a million dollars may seem quite pricey, contrast this expense with the average cost of a patent litigation to the CAFC, estimated by the AIPLA to be $ 3 million for a low stakes case (i.e., less than $25 million at stake) and $6 million for a higher stakes case.
Thanks for this assist to a more sober and realistic analysis of the unlikely significant usage of Post Grant Review (PGR) [to challenge (within only 9 month window after issuance) patents filed on or after March 16, 2013]. Besides the large costs, there will be a greatly expanded estoppel danger due to its expanded invalidity grounds. Furthermore, relatively few defendants are threatened with patent infringement on patents so new that they have been issued for only 9 months or less, as compared to older patents. Gratuitous use of this costly and dangerous system by non-threatened parties is highly unlikely. Some of the projections of usage of this new U.S. post-grant “opposition” system are highly unrealistic, with false analogies to the very different EPO practice and its consequences.
Paul,
I would agree that PGR will be used much less than IPR due to the limited window of opportunity. Keep in mind however that unlike IPX, these proceedings can be settled. Thus, not every proceeding will cost the full price.
The significant estoppel effect of PGR may cause many filers to actually wait out the 9 month window in order to “save” some defenses for a subsequent litigation should IPR prove unsuccessful.