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  • The opinions, commentary and characterizations provided to this online forum by the authors and moderators are provided for encouraging discussion, thought and debate on important post grant issues. These postings are in no way representative of the opinions of Oblon Spivak et al., or its clients.

Is Supplemental Examination a Risk Worth Taking?

Posted On: Feb. 15, 2012   By: Scott A. McKeown
supplemental examinationIn re Tanaka Decision Likely to Drive Two-Part Supplemental Examination Filing Strategy

During yesterday’s Strafford Legal webinar on the topic, I explained that Supplemental Examination (SE) is a mechanism of the AIA that is designed to effectively cure inequitable conduct via a new post grant proceeding of the USPTO. This mechanism, effective September 16, 2012 will be available to all issued patents.

In operation, SE allows a Patentee to submit very detailed explanations of potential issues that may serve to render the patent invalid under an inequitable conduct theory in litigation. Upon submission of Substantial New Questions of patentability (SNQs) detailing such potential defects, the Office will reconsider or correct such information; that is to say the Office will perform a “supplemental examination.”

If the SNQs of an SE request do not rise to the appropriate level to justify further proceedings, an SE certificate is issued stating such, and the proceeding concludes. Likewise, should SNQs be identified in the request for SE, a certificate is issued identifying such. Thereafter, a modified form of “re-examination” is initiated by the Office to explore the SNQs presented in the request. Should the Office determine that the identified SNQs do not preclude patentability in the reexamination phase, a reexamination certificate is issued to complement the SE certificate. Thus, SE is modeled on the same “but for” materiality standard pronounced in Therasense.

At first blush, the option to cure potential inequitable conduct issues seems an attractive option for Patentees. Yet, practically speaking, there may be very few instances in which an SE filing is advisable.

First, the level of detail required to present an SNQ in an SE request is significant, unlike other post grant options— such as patent reissue. The CAFC’s decision in Tanaka may present a more appealing option for those seeking to correct all but the most pronounced inequitable conduct problems.

Consistent with Tanaka, a patent reissue application can be pursued based upon the simple addition of new dependent claims. Thereafter, IDS filings can be submitted for many of the same SNQs that would otherwise be presented in a request for SE. Perhaps most importantly, there would be no need to explain these issues with the same detail as required by the SE rules. After considering such IDS filings, should the Office allow the claims without amendment “but for” materiality is disproven. In other words, inequitable conduct on such issues is for all practical purposes cured by operation of the patent reissue. On the other hand, if it becomes apparent that amendment is required (thus proving “but for” materiality), the Patentee can simply abandon the reissue filing and pursue the more detailed, and much more expensive, SE filing.

Second, as mentioned above, the cost of the SE filing is significant.

As outlined in January’s rule package for supplemental examination, a filing fee of $ 5,180 is necessary to request supplemental examination, and another $16,000 for the resulting ex parte reexamination (should the supplemental examination request raise a substantial new question of patentability (SNQ). Conversely, the filing fees for patent reissue are currently set at a fraction of the cost of an SE filing.

Moreover, the SNQ standard applied in SE is a very low hurdle (over 94% of SNQs are accepted by the Office in ex parte patent reexamination filings.) On the other hand, the prima facie standard necessary for a first action is considerably higher. As such, it is not that uncommon in current ex parte patent reexaminations proceedings for the Office to grant an SNQ, then promptly issue a first action confirmation of the claims. Under the SE cost structure, a Patentee would be paying $16,000 for a determination that may be seemingly made for several hundred dollars via a patent reissue IDS filing.

Third, calling out practitioner conduct is fraught with peril.

It seems extremely unwise for a law firm to pursue SE for issues arising from it’s earlier prosecution representation as they must detail such issues in an SNQ format. Depending upon the circumstances, the request itself could serve as a road map for a malpractice charge. Likewise, filing a request and calling out the conduct of a competitor, in a public filing, may be equally unwise.

The USPTO has predicted roughly 100 SE fillings per year based upon current Patentee initiated ex parte patent reexamination filings (the thinking being SE offers the same advantages with additional benefits). Yet, SE filings are expected to be few and far between. For those that are pursued, testing the waters first via patent reissue would seem to be a prudent strategy.

4 Responses to “Is Supplemental Examination a Risk Worth Taking?”

  1. Paul F. Morgan says:

    However, SE’s are for those planning to sue on a patent, or for convincing others to take a license, by eliminating IC or invalidity defenses in advance. Unless the PTO considerably speeds up its handling of reissues, a reissue taking several years is not likely to be desirable for that purpose.

  2. Paul,

    Agreed, I have commented a great deal on the pendency issues with reissue practice; fair point.
    In my view, if litigation is looming you are far better off heading into court where the very same standards are applied as in SE for IC charges (BRI, preponderance of evidence). I just don’t see Patentees choosing to spell out the issues for their adversary ahead of time in SE (possibly creating further issues in the process). If profits/market share are being lost, I think you take your chances in court where you have the most business leverage.
    For those patents that may have issues, and litigation is anticpated down the road, reissue seems like the best option as a starting point. With the new revisions to the oath practice, perhaps pendency will be improved.

  3. Paul F. Morgan says:

    Good points Scott, and here is another concern. Unless I missed it, the proposed rules for these new “supplemental examinations” [a broad and powerful new tool for patent owners to completely remove, pre-litigation, inequitable conduct and almost any other patent litigation defense entirely ex parte], does not seem to provide anything specific about providing the PTO with any discovery to help get to the truth of what will otherwise be completely unchallengeable patent owner fact allegations?

  4. Paul,

    The Office could issue interrogatories under Rule 105 to get at additional factual information. Although, as you know this rule is very rarely invoked…yet, seems like the ideal use here.

    Scott