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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.

Congress to Tackle Potential AIA Fixes?

Posted On: Nov. 15, 2012   By: Scott A. McKeown

AIA technical amendment

Congress Returns to Action

With the election season now concluded, Congress will shift their focus back to more traditional duties, like playing chicken with the world economy as we teeter on the “fiscal cliff.” The pessimist in me would find it hard to believe that the much discussed technical amendments to the AIA are anywhere near the top of the legislative agenda, but, hope springs eternal ….and there are quite a few tweaks that are in order on the post grant side of the equation.

Perhaps the most pronounced “error” of the AIA, whether deemed truly “technical” or not, is the all encompassing estoppel provision of Post Grant Review (PGR).

As a reminder, PGR estoppel precludes a challenger from raising in a later proceeding an issue that was “raised or reasonably could have been raised” in the PGR. While this language is identical to the estoppel provision of Inter Partes Review (IPR), the scope of issues that may be brought in a PGR proceeding are relatively unlimited as compared to IPR (patents and printed publications only). As a result, a challenger that fails to prove unpatentability in a PGR proceeding will be left, practically speaking, with no invalidity defenses should the dispute move on to the courts. (save inequitable conduct, and perhaps defenses that would have been unreasonable to raise earlier… whatever “reasonable” is construed to cover down the road)

Another factor that makes PGR estoppel an absolute non-starter is the USPTO requirement to present such all encompassing validity issues within an 80 page, 14 point font, double spaced petition. For at least these reasons, and for its limited time window (within 9 months of patent issuance), PGR will not be a realistic option for future patent challengers. (keep in mind that PGR applies only to future, first-inventor-to-file patents)

Yet, some would disagree that PGR is fraught with risk.

In a recent post on Patently-O, one author takes the opposing view point, seeking “legislative restraint.” The author asserts that that a softening of the PGR estoppel provision will undermine the finality of the USPTO proceeding. The author also argues that  ”gamesmanship” would be encouraged by a more liberal estoppel provision because patent challengers would be motivated to hold back issues from the Office as insurance to a later proceeding. The author also points to the “reasonably” could have raised aspect of the estoppel provision as providing a natural limit on the much ballyhooed ”Draconian estoppel result.”

Yet, these arguments seem inconsistent with the existing post grant landscape.

First, anyone wishing to preserve defenses for a later proceeding need only sit out the PGR window (wait 9 months) and then file an IPR. In this way invalidity defenses that are not subject to IPR ’s limited scope (patent/printed publications) would be preserved. As the vast majority of infringement suits are in the predictable arts, especially in the non-practicing entity (NPE) area, publication based invalidity defenses will almost always exist for IPR purposes. So, leaving PGR “as is” will not avoid gamesmanship in the vast majority of cases.

Second, if the courts apply the “reasonably could have raised” standard as broadly as implied by the author, which is far from clear, finality of USPTO decisions would likewise be undermined. While the USPTO can make representations on how they interpret the statute, the courts often have entirely different ideas. Indeed, absent published decisions on the metes and bounds of “reasonability,” few are likely to step up to be guinea pigs in that regard; especially with their entire invalidity case hanging in the balance.

If PGR estoppel is revised by Congress to be consistent with that of the Covered Business Method (CBM) mechanism, as some would argue was the original intent, parties will be far more likely to pursue PGR. Absent modification, such flings will be few and far between…if at all.

3 Responses to “Congress to Tackle Potential AIA Fixes?”

  1. Kip says:

    The CBM estoppel standard just invites piecemeal litigation. That’s a blessing to accused infringers, and a nightmare for patent owners.

    Remember that many of the factors you cite against PGR are factors against civil litigation too. Estoppel applies in litigation as well (right?). The page/font limit doesn’t apply to litigation, but it hurts patent challengers as much as it does patentees – ultimately it should be a wash.

    Right now, PGR is cheaper, and the standard for both evidence and claim construction are more favorable to challengers. Whatever reasons counsel against PGRs will have to outweigh those benefits. It’s far from clear that they do.

    What I’ve heard, from the gravevine, is that many litigators don’t recommend PTO proceedings to their clients, simply because they result in less revenue to their firms. Lawyers have an obvious bias toward more expensive litigation in district court.

  2. Kip,

    I just don’t see much balance in PGR estoppel. Until a few decisions on “reasonableness” issue, there is just not going to be enough comfort there; that could be 10 years from now. As you point out, lawyers are an overly cautious bunch when it comes to changes in the practice. I would prefer to see something done now, otherwise, the Bio/Pharma community is left with very little short term options in the post grant realm (112 and 101 are typically more of a pronounced concern in that space)


  3. Paul F. Morgan says:

    As explained in the “comments” posted on the above-noted Patently-O blog post of a Steve Kunin article, there cannot be “piecemeal lititgation in a regular [not business method] PGR because it can only be brought for only 9 months after the patent issues, barely enough time for one of them, and time for common Board treatment.