Patents Post Grant Blog

Low Demand To Date for Specialized PTAB Review Proceeding

The new post grant patentability trials of the America Invents Act (AIA) are designed to serve as alternatives to costly patent litigation. One of the new post grant options is the very specialized, Transitional Program for Covered Business Method Patents, or “CBM” proceeding. This proceeding, like Inter Partes Review (IPR), is conducted before the administrative patent judges of the USPTO’s Patent Trial & Appeal Board.

As the name implies, a CBM proceeding is limited in scope to “business method” patents. Assuming a subject patent qualifies as a business method, and is asserted against a petitioner in a litigation (or a petitioner is otherwise charged with infringement), a CBM filing is available as an alternative to the litigation. Indeed, Congress devised CBM proceedings to virtually guarantee the stay of the higher cost litigation proceeding. The CBM provision was added to the AIA as a compromise between those that did not want a “second window” for Post Grant Review (PGR) (bio/pharma lobby) and those (financial/software) that felt the change in 101 case law (Bilski) should be applied to the multitude of patents that resulted from the State Street Bank decision. 

CBM is an especially powerful tool to combat business method patent assertions, yet only 17 have been pursued to date. Why? Read the rest of this entry »

PTAB Selective on Trial Grounds

Having now completed the multi-city tour for the Practicing Law Institute’s USPTO Post Grant Patent Trials 2013 (on demand program here), I am still struck by the degree of doom and gloom expressed by the patent monetization crowd. Throughout the program stops in Chicago, New York City and earlier this week, San Francisco, many attendees expressed the concern that the new post grant PTAB proceedings were “patent killers.” Specifically, the institution rate of the trial orders issued to date was considered high (only two being denied). This, coupled with the more favorable challenger standards of the PTAB, has more than a few patentees quite worried.

While it is certainly true that the PTAB is a more favorable venue for patent challengers (no presumption of patent validity, no clear and convincing evidentiary requirements, etc), the trial orders issued to date show an intent on behalf of the PTAB to simplify and focus the dispute for trial. This simplification vastly reduces the workload of patentees relative to the old inter partes patent reexamination system. And with the addition of discovery before the PTAB, ultimate success for patentees seems far more likely before the PTAB relative to the old, never-ending, patent reexamination timelines.   Read the rest of this entry »

Public Can Listen to Arguments Telephonically

As discussed last week, the very first petition for a Covered Business Method Patent Challenge (CBM) was filed on September 16th by SAP (CBM2012-00001). The petition (here) challenged U.S. Patent  6,553,350 of Versata Development Group. In May of 2011, Versata secured a $391 million dollar verdict in the Eastern District of Texas against SAP. The verdict is currently on appeal to the CAFC.

The PTAB has expedited this CBM to oral argument as the issues have been narrowed to 101 grounds only.

The USPTO has published the dial-in-number to listen to the argument (here)

(571) 270-3000

meeting ID number 28001#

password 7448#

Popular Daily Email Service Now Includes PTAB Ruling & Filings

 Docket Navigator is well known to practitioners for its highly popular daily Docket Report. This subscription report is emailed out every morning and includes not only the new complaints/actions filed in the district courts and ITC, but also all notable decisions and Orders. Recognizing the emerging importance of the USPTO’s Patent Trial & Appeal Board (PTAB), the Docket Report now includes information on new PTAB filings and noteworthy decisions as they occur. 

The expanded Docket Report will be of great value to PTAB practitioners by providing every new and noteworthy filing/order within a day of filing/issuance. The new PTAB petitions will be reported along with notable orders, each being accompanied by a short, explanatory synopsis of the facts and result.  

Stay Calculus to Encourage Multi-Defendant Attacks

As the new patentability trials of the America Invents Act (AIA) have only been available for 7 months their impact is only now beginning to be felt in the district courts. The new USPTO Patent Trial & Appeal Board (PTAB) proceedings permit suspect patents of any vintage to be reconsidered in a far more speedier, cost effective, and challenger friendly manner relative to that of the federal district courts. Not surprisingly, there has been a robust demand for these proceedings with over 200 such petitions filed since September 16th—many of which target the patents of non-practicing entities (NPEs).

The impact of these new PTAB proceedings are beginning to be felt in the district courts as motions to stay the costlier court proceedings pending PTAB review are being considered almost daily. And, many courts are staying the parallel litigation in favor of the speedier USPTO proceedings. Interestingly with the argument of multi-year USPTO reexamination delays now eliminated by the faster PTAB proceedings, Patentees (NPEs in particular) are now emphasizing to the courts that estoppel only applies to the petitioner or real party in interest—not necessarily every defendant in a multi-defendant suit. As such, NPEs argue that a concluded PTAB proceeding will not simplify issues for trial because defendants that did not join in the petition filing would be free to raise the very same issues decided in the PTAB proceeding upon lifting of the stay.

The solution for non-petitioning defendants facing such an argument is really quite simple…..just pile on.

Read the rest of this entry »

PTAB Considers Broadcast of First AIA Oral Hearing

The very first petition for a Covered Business Method Patent Challenge (CBM) was filed on September 16th by SAP (CBM2012-00001). The petition (here) challenged U.S. Patent  6,553,350 of Versata Development Group. In May of 2011, Versata secured a $391 million dollar verdict in the Eastern District of Texas against SAP. The verdict is currently on appeal to the CAFC.

Back in January, the PTAB held that SAP’s CBM petition had demonstrated that it was more likely than not that the claims of the ‘350 patent were unpatentable under 35 U.S.C. §§ 101 (Trial Order here). The PTAB agreed to expedite the trial schedule and move the oral hearing to April 17, 2013. (decision here) The six month acceleration in the proceeding was provided in exchange for SAP dropping the prior art defenses, and agreeing to move forward only on their 101 challenge to the Versata patent.

Three weeks back, Versata filed suit against the USPTO challenging the agency’s definition of a “business method,” and the ability to raise 101 as a statutory ground in a CBM. (101 is argued as not being embraced by 35 U.S.C. § 282, complaint here)

At last week’s ABA meeting it was noted that broadcast access (webcast or audio) was being considered for the April 17th hearing (limited to 101 grounds). It appears that at least the patent owner has agreed to the broadcast (statement here).

I will post more information on the broadcast as it becomes available.

The PTAB Has Instituted 34 IPR Proceedings to Date

Since September 16th 2012, the USPTO has received roughly 207 petitions for patentability trials of the America Invents Act (AIA) 11 CBMs and 190 IPRs. These proceedings must, by statute, be completed within 12 months (exceptional cases may be extended to 18 for good cause). Of course, this 12 month time frame applies to the trial proceeding, which begins upon issuance of an Order instituting trial. In order to gauge the complete USPTO processing time for conducting an IPR/CBM to a written decision it is also necessary to consider the preliminary proceeding.

The preliminary proceeding begins upon filing of the petition. Three months thereafter the Patent Owner has the opportunity to file a preliminary response. Once this response is entered, the USPTO has three months, by statute, to Order trial. As can be appreciated this “front end” or preliminary proceeding can span a maximumn of 6 months. Of the 34 trials Orders issued to date, the average time is hovering right around the 5 month mark.

As shown below for preliminary proceedings in which a preliminary response is filed in IPRs, the PTAB is issuing an Order around the 155 day mark. For those in which the preliminary response is waived, roughly one month sooner at 122 days. (Click to Enlarge)

These categories can be further broken down into cases where the preliminary response was affirmatively waived (3 cases) and those where the Patentee just did not file anything (2nd chart). Cases where no preliminary repsonse was filed, and no affirmative waiver received are averaging 171 days.

For those seeking CLE this Spring, there are numerous upcoming options. The Spring Meeting of the Intellectual Property Law Section of the American Bar Association (ABA-IPL) will convene this week on April 3-5th in Arlington Virginia. On Thursday April 4th, the meeting will kick off with the program “Patentability Trials of the AIA: The First 120 Days.” I will participate in a plenary session with the Chief Judge of the Patent Trial & Appeal Board (PTAB), the Hon. James Smith and Trial Section Lead, the Hon. Michael Tierney.

Also this week, Patent Resources Group offers a three-day course on post-issuance administrative proceedings titled Post-Grant Patent Practice:  Review, Reexamination, Reissue and Supplemental Examination. The topics covered in the course are also comprehensively addressed in a two-volume treatise, which is provided in conjunction with the course.  My partner, Kevin Laurence, has been one of the course instructors since 2009.  The course is scheduled for April 7-9 in Orlando, Florida.

Next week, for those having a particular interest in business method and software patents, I will be speaking at the American University Washington College of Law program entitled: iWars: Legislative, Judicial, and Executive Challenges to the Validity of Computer-Implemented Business Method Patents in the Wake of the Leahy-Smith America Invents Act of 2011 on April 12th.

On April 11th and 12th my partner Todd Baker will be speaking in Dallas Texas on Nuances and strategies for successfully prosecuting and defending IPRs, PGRs, CBMRs before the Board at the AIPLA’s Advanced Practice Under the America Invents Act.

The Practicing Law Institute’s USPTO Post Grant Trials- 2013 (now in its 4th year) will also be making 2 more stops across the country. This year’s program, which I am pleased to chair, coincides with the release of the new treatise entitled Post Grant Proceedings Before the Patent Trial & Appeal Board, the remaining stops include:

• Apr. 15, 2013 San Francisco, CA
• Apr. 29, 2013 Austin, TX

Hope to see you see you at an upcoming event.

Suit Takes Aim at “Business Method” Definition & Propriety of 101 Grounds

The very first petition for a Covered Business Method Patent Challenge (CBM) was filed on September 16th by SAP (CBM2012-00001). The petition (here) challenged U.S. Patent  6,553,350 of Versata Development Group. In May of 2011, Versata secured a $391 million dollar verdict in the Eastern District of Texas against SAP. The verdict is currently on appeal to the CAFC.

Back in January, the PTAB held that SAP’s CBM petition had demonstrated that it was more likely than not that the claims of the ‘350 patent were unpatentable under 35 U.S.C. §§ 101 (Trial Order here). The PTAB agreed to expedite the trial schedule and move the oral hearing to April 17, 2013. (decision here) The six month acceleration in the proceeding was provided in exchange for SAP dropping the prior art defenses, and agreeing to move forward only on their 101 challenge to the Versata patent. 

Two weeks back, Versata filed suit against the USPTO challenging the agency’s definition of a “business method,” and the ability to raise 101 as a statutory ground in a CBM. (101 is argued as not being embraced by 35 U.S.C. § 282, complaint here) 

Liberal Stay Policy Thwarts Patent Suits in New Jersey

Non-practicing entities or “patent trolls” are generally those plaintiffs that seek to enforce patent rights against an industry in which they themselves do not compete. Stated another way, an NPE’s only business is patent litigation.

Often times the patents an NPE is enforcing were purchased from a traditional technology company for the sole purpose of exacting royalties from the relevant industry. In the hands of an NPE, which has no technological industry subject to a patent counter suit by their industry targets, the NPE patents become especially powerful weapons of economic coercion.

Over the last decade, law firms have recognized the efficacy of NPE litigation campaigns and have signed on in great numbers to get a piece of the action. Typically, an NPE will team up with a law firm that will conduct the campaign on their behalf in exchange for a contingent fee arrangement. (i.e., percentage of the collected settlements). This profiteerring business model has lead to a significant proliferation of patent infringement suits.

Just not in New Jersey. Read the rest of this entry »