DrudgeSirenass=”alignleft size-full wp-image-1538″ title=”DrudgeSiren” src=”https://www.patentspostgrant.com/wp-content/uploads/2010/03/DrudgeSiren.gif” alt=”DrudgeSiren” width=”50″ height=”69″ />As reported last week, a revised version of S.515 is expected to be made public in the very near future.  Reliable sources have informed the authors of PatentPostGrant.com of the nature of some possible changes to the version of S. 515 that was passed by the Senate Judiciary Committee in April 2009.  Over the next several days, we will outline the major changes, focusing mainly on the reshaping of the post-grant review landscape.  These changes are believed to be in the “Post Grant Review Proceedings” sections of the revised bill, covering both reexamination changes and introducing a new post grant revocation procedure. The revised bill will, if passed without further amendment, present very significant changes to the existing post-grant landscape of ex parte and inter partes reexamination.

The Post Grant Review Proceedings being considered are believed to be segmented into two sections, namely, Inter Partes Review (formerly known as inter partes reexamination) and Post-Grant review.  Ex Parte reexamination would be changed to “Supplemental Examination.” The term “reexamination” would be used only with respect to supplemental examination, for reasons discussed next.

A.  Supplemental Examination (ex parte reexamination)

Supplemental Examination will like reissue be limited to Patent Owner requests.  Interestingly, the current proposal provides that “information” not submitted, incorrect, or inadequately considered  in the original prosecution may be submitted in the supplemental examination by the Patent Owner to cure inequitable conduct charges stemming from the earlier deficiency. Further, once Supplemental Examination is ordered, the claims would be examined on all conditions of patentability as they are in reissue.  This provision will take effect 1 year after enactment of the new legislation and apply to all patents in force. 

PPG Comment:  The distinction between this revised ex parte, supplemental examination and patent reissue would become less distinguishable, with the exception of broadening reissues and that an error made without deceptive intent need not be identified with respect to the original patent in supplemental examination.  It is anticipated that this aspect of the proposal would be welcomed by many practitioners as a mechanism to cure innocent prosecution oversights.

B. Inter Partes Review (inter partes reexamination)

As we understand the new proposals, one of the more striking changes to S.515 for Post-Grant Review Proceedings would be the replacement of the SNQ standard with a heightened standard to initiate the proceedings (based on patents and printed publications only — Post Grant Review providing expanded grounds).  The standard for granting Inter Partes Review would be whether or not the petition “shows that there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.”  This determination is made after the Director reviews the petition, and a “Preliminary Response” of the Patent Owner.  Thereafter, the Director has 3 months to grant or deny the request.

PPG Comment: Arguably, the SNQ standard of “important to an examiner” is lower standard than the new standard, which seems to be mirroring a standard for determining whether a preliminary injunction should be imposed.  This change in standard may have been added to appease the bio/pharma sector and should significantly reduce the IPR order rate from the >95% grant rate of today.  

         1.  Estoppel

The estoppel provision of 35 U.S.C. § 315 we understand would be revised to “raised or reasonably could have raised” (emphasis added)

PPG CommentThis language, while certainly less vague than the previous version, still creates uncertainty.

Further, 315 estoppel is proposed to be extended to ITC proceedings. (see our earlier discussion of this issue here

          2.  Timing

Inter Partes Review may not be initiated or maintained if petitioned more than a few months after a concurrent litigation filed either by the patent owner or petitioner.

PPG Comment:  It appears that avoiding late filed challenges at the USPTO (late with respect to a concurrent litigation) will be avoided by these provisions, perhaps avoiding the perceived Translogic v. Hitachi problem of overturning a jury verdict.  Also, IPR could be instituted only after a post-grant review was terminated or when no post-grant review petition was filed. 

         3.  Discovery/Proceedings Conduct

The Director would establish rules for discovery of relevant evidence, including depositions of witnesses submitting declarations and affidavits. 

The Director may prescribe sanctions for abuse of discovery and process, or any other improper or harassing tactics.

The Director also would prescribe regulations to:

-Provide either party with the right to an oral hearing as part of the proceeding.

-Require the proceeding be concluded within 12 months, extendable to a maximum of 18 months.

-Allow for settlement of the proceeding, with no estoppel applied to the third party.

-Provide that the final determination be provided by the Patent Trial and Appeal Board.

One year subsequent to enactment, Inter Partes Review will apply to all patents. (emphasis added).  Inter partes reexaminations instituted prior to the effective date will continue unchanged.

PPG Comment: The changing of inter partes reexamination to an Inter Partes Review conducted before the Patent Trial and Appeal Board would seem to significantly diminish the role of the Central Reexamination Unit.  Although not spelled out in the legislation, it appears as though the Director will have significant latitude on how to leverage the expertise of the CRU in this new equation.  Perhaps, these experienced examiners, albeit some without law degrees, would be best utilized as advisors to the Patent Trial and Appeal Board, akin to a technical advisor at the International Trade Commission or Federal Circuit.

Tomorrow, conceptual changes to Post Grant Review will be detailed, stay tuned.