Parallel Litigation Settles, Now What?
With the vast majority of patent reexaminations now being conducted concurrent to a district court or ITC proceeding, a common question of Patentees is “what becomes of the patent reexamination once the litigation settles?”
In the case of ex parte patent reexamination, the answer is simple: the reexamination continues unaffected. Indeed, as demonstrated a few weeks back (In Re Construction Equipment, CAFC (2011)), the ultimate outcome of the ex parte reexamination can even effectively reverse an earlier decision of the CAFC.
On the other hand, if the pending reexamination is an inter partes patent reexamination (IPX), the answer will depend on the nature of the terms of the settlement agreement. In a best case scenario for Patentee, the IPX proceeding may be vacated altogether by operation of estoppel. Of course, to trigger IPX estoppel, the settling defendant/requester must agree to a consent consent judgement in the district court (not effective in the ITC as estoppel does not apply) that they failed to prove invalidity. In most cases, defendants are loathe to publicly admit defeat. Still, unwary Patentes may be walking away from significant opportunity if just swinging for the fences. Read the rest of this entry »
Top Stories of 2011
2011 was perhaps the most significant year to date in terms of post grant patent practice. The perennial legislative effort generally known as “patent reform” finally bore fruit as the Leahy-Smith America Invents Act (AIA); patent reexamination filings in 2011 reached an all time high; patent reissue practice was explored and clarified by the CAFC; and patent litigation parallel with patent reexamination continues to expand as a well established strategic practice.
As to the America Invents Act, several entirely new post grant patent proceedings have now been enacted into law (effective September 16, 2012). A summary of these proceedings, and discussions of their expected impact are linked below (and throughout the blog).
Post Grant Review
Inter Partes Review
Supplemental Examination
Derivation
Transitional Business Method Patent Challenge
The USPTO is scheduled to Read the rest of this entry »
BPAI Reverses Rejections on CAFC Claim Construction
The seemingly never ending saga of the NTP patent reexaminations took yet another interesting turn yesterday. The BPAI issued revised decisions on remand that reversed the earlier rejections of some of the NTP claims. As a reminder, the reexamination of the NTP patents began during the litigation between NTP v. RIM. The reexaminations continued at the USPTO in parallel with the then ongoing, and now infamous, litigation. However, the co-pending litigation continued on to the settlement, narrowly avoiding a disruption of RIM’s business in the U.S via court imposed injunction.
Now, some 6+ years later, the reexaminations may be close to a conclusion (absent further appeal by NTP).
The revised decisions stem from the CAFC remand on claim construction issues relating to the definitions of “electronic mail” or “electronic mail message.” As a result of the revised construction, NTP has manged to claw back some of their previously rejected claims. Read the rest of this entry »
Determination of Non-Obviousness by USPTO Disregarded by Court
Last week’s CAFC decision in In re Construction Equipment decided the validity of U.S. Patent 5,234,564…..again. In the first appeal, decided in 2001, the CAFC upheld the validity determination of the District Court. In the second appeal, decided last week, the CAFC considered an appeal from the USPTO rejecting the claims of the ‘564 patent in ex parte patent reexamination. In their second decision, the CAFC found the ‘564 Patent invalid in light of some of the very same prior art references at issue in the first appeal.
In her dissent Judge Newman questioned the constitutionality of the USPTO looking over the shoulder of the CAFC.
In a case of “turnabout is fair play,” last Friday, a United States District Judge for the District of Connecticut considered, and disregarded, the USPTO’s reexamination analysis of the same prior art in Jacobs Vehicle Equipment Co. v. Pacific Diesel Brake Co. et al. (D.Conn). Read the rest of this entry »
CAFC Appeal Result Undone 11 Years Later
Patent reexamination is often initiated in parallel with an ongoing infringement litigation. In the case of a parallel inter partes proceeding (IPX), the first of the proceedings to conclude (litigation or IPX) controls the outcome of the other by operation of statutory estoppel. As such, a final holding in the parallel court proceeding will end an ongoing IPX. Moreover, the losing party would be precluded from seeking IPX at a later date.
On the other hand, ex parte patent reexamination (EXP) has no such statutory “shut off valve.” Thus, even a party that was bound by IPX estoppel could file a request for ex parte patent reexamination. In this way, the infringer could attempt to “undo” the effect of the earlier, final, court judgement by invalidating the patent via the EXP filing.
As I explained this past August, the CAFC questioned this “do-over” practice during the oral argument of In re Construction Equipment. Last week the CAFC issued a decision in this case. In the process, the CAFC disturbed the holding of their first decision, issued some 10 years earlier. Read the rest of this entry »
USPTO Considers Record Number of Requests for Patent Reexamination
In fiscal year 2011 the USPTO initiated a total of 1133 patent reexamination proceedings (both ex parte and inter partes). The 2011 tally represents an overall increase in filings of about 7% relative to 2010 numbers.
Interestingly, while ex parte filings receded slightly, inter partes filings surged by 33% relative to 2010. In FY 2011 374 requests for inter partes patent reexamination were filed.
USPTO statistics for 2011 are found (here)
Ex parte patent reexamination proceedings are typically disfavored over inter partes reexamination proceedings as being too one-sided, and historically biased in favor of patent holders. Likewise, as patent reexamination is increasingly employed as a litigation tool, it is not surprising that the more robust proceeding is now Read the rest of this entry »
New Appeal Rules Effective January 23, 2012
This past Monday the USPTO released the final rule package pertaining to the Rules of Practice Before the Board of Patent Appeals & Interferences in Ex Parte Appeals. (here).
This final rule notification stems from the earlier notice of proposed rule making issued last November. The rules are limited to ex parte proceedings only and have no bearing on patent interferences, or inter partes patent reexamination. Likewise, the new rules will not control Inter Partes Review or Post Grant Review. The final rules become effective on January 23, 2012. (for appeals initiated on or after the effective date)
In response to the original publication of the rules, I pointed out that the proposal provides an interesting safeguard against new rejections in an Examiner Answer. Namely, the filing of a 1.181 petition challenging such a rejection tolls the period for filing a Reply brief. Thus an Applicant may await decision on the petition before filing the Reply. This provision will be very helpful in patent application prosecution, but may aggravate ex parte reexamination pendency if abused. Read the rest of this entry »
Historical Patent Reexamination Statistics Belie Modern Practices
When considering whether or not to stay a parallel litigation in view of a pending patent reexamination a district court will consider several factors. While delay is common to all stayed cases, the degree of delay caused by patent reexamination can be considered prejudicial. For this reason, especially when it comes to inter partes patent reexamination, the average length of the proceeding can be instructive to the Court.
Hoping to convince the Court of a prejudicial delay, Patentees will argue that inter partes patent reexamination takes on the order of 5-7 years to complete through appeal, citing those cases that have been fully contested through appeal. Defendants, on the other hand, will cite to published USPTO statistics that indicate inter partes patent reexamination pendency to be an average of 36 months, including appeal. (As pointed out previously, the 36 month statistic is skewed by the small number of completed inter partes patent reexaminations that have been fully contested through appeal).
However, regardless of the statistical theory advanced to the court, what neither theory considers is that historical statistics are weighed down by years of past USPTO practices. As one plaintiff found out recently, the USPTO has greatly streamlined the processing of inter partes patent reexamination relative to past practices.
Read the rest of this entry »
Court Favors Staying Troll Suit
The existence of a competitive relationship between the litigants is often times an important consideration to district court judges considering a stay pending patent reexamination. When weighing the equities whether or not to grant a motion to stay the court action pending USPTO reexamination the trend has been to deny motions for direct competitors. This is because, when staying a litigation dispute between competitors, there is a danger that the delay could cause erosion of market share, customer loyalty, or other intangible business factors….not so with patent trolls.
Patent trolls, also known as “non-practicing entities” to some, do not compete with their infringement targets in the marketplace. Not surprisingly, courts have begun to emphasize the “troll” factor as favoring a stay of the litigation. Read the rest of this entry »
Proper Petition Practice Especially Critical in Patent Reexamination
In most cases, the distinction between appealable vs. petitionable issues at the USPTO is quite clear. For example, if you believe that a patent examiner has prematurely entered a final rejection, the appropriate avenue for relief is by way of petition. Indeed, the MPEP states such explicitly. MPEP 706.07(c). Yet, not all examination/reexamination disputes are so clear cut. (See earlier discussion on ex parte SNQ review process here)
The distinction between appealable vs. petitionable disputes is especially critical in post grant proceedings such as patent reexamination. This is because failure to appreciate the distinction between the two could potentially forfeit substantive patent rights. Read the rest of this entry »
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